Children Shoes
| Product Code | 291101003 (Leather shoe) |
| Quality and Standards | As Per Buyer's Specification |
| Production Capacity | Qty. : 1,80,000 pairs (per annum) Value : Rs. 49200000 |
| Uploaded on | March 2007 |
Introduction
Children Shoes are used for protecting the children foot from injuries from stones, nails, broken glass pieces fallen on the road, infection from the dust, dirt, mud, water and to feel comfort during different climatic conditions. Children shoes in particular, are very important in order to save the foot not only from above incidents but also from the deformation of foot in the childhood because of their softness and growing tendency. Now a days, the children shoes are very common part of school uniforms introduced by many governments as well as public schools and these are mainly of a specific style i.e. derby with black colour. The shoes worn by the children are multifunctional such as to serve the purpose of uniform as well as for feeling comfort during sitting, walking, playing and so to say for every casual and rough uses. Therefore these type of shoes need to be well designed in order to have enough space inside the shoe, flexible, light weight, descent look in addition to correct fitting. In this project, it has been proposed to manufacture both children school shoes and children fancy shoes. Although these products are available with different materials like coated fabrics, textile, and a combination of variety of materials, yet leather shoes are having popularity due to comfort, durability, aesthetic look and up-manship. The children school shoes are suggested to be made black coloured derby style with PVC soles and the fancy shoes can be made with different styles such as boots, trainers and other descent look models by using single or multi coloured leather components and PVC or TPR soles.
Market Potential
The demand of the Children shoes is increasing day by day in tune with the growth of population, their economic standards, education system and fashion consciousness every where in the country. The increasing number of public schools vis-a vis the number of school going children and foot care awareness along with the fashion orientation increases the demand of such products every day. Thus it is felt that there is an ample requirement of children shoes in every locality. Moreover, the export worthiness of such products from our country is bright, seeing the present trend. Shoe units aiming to manufacture children shoe of different types, can, therefore, sustain viably by catering to the increasing needs.
Basis and Presumptions
This project profile has been prepared based on the following assumptions
| Working Hours | Double shift of 8 hours each i.e 16 hours a day for 300 working days in a year |
| Capacity Utilisation | 60% during first year 70% during second year 80% during 3rd year and onwards |
| Entrepreneur | Preferably by one or group of promoters having knowledge/experience in leather and footwear field and /or venturing to start leather based units. |
| Location | Any where in India, preferably near any township. |
| Land and Building | Cost is calculated as per prevailing market rates |
| Important Raw Materials | Chrome tanned cow softy upper leather, flexible insole and PVC/TPR Soles. |
| Salary and Wages | All the employees are paid on monthly basis. |
| Transportation and Taxes on purchase | Included in purchase price |
| Power Charges | Rs.4 per KWH from power supply source 5% on building and civil construction 10% on plant and machinery |
| Depreciation | 25% on Tools and equipments 20% on furniture and fixture 10% on other fixed assets |
| Margin Money | 30% of total capital investment |
| Interest Charges | 12% has been calculated on total capital investment. 100% insurance, interest and depreciation 40% of total salary and wages |
| Fixed Cost for BEP Analysis | 40% of total utilities and other Contingent expenses excluding insurance |
Implementation Schedule
Activity |
Period (in months) |
| Site selection, negotiation with land lord, market survey, Preparation of project report and other formalities | 2 |
| Seeking quotation of machines, purchase and installation and power connection | 2 |
| Trial production, arranging working capital, Procurement of raw material and market tie-up | 2 |
| Total period required for commencing commercial production | 6 |
Technical Aspects
Process of Manufacture
In this project, the children shoes are proposed to be manufactured in two different types i.e.:
(i) Children school shoes, and (ii) Children fancy shoes. The former is derby type and is normally made from black coloured chrome tanned cow softy upper leather and the later is of fancy type with single or brilliant multi colour. Both types are made in different sizes and fittings.
The manufacturing process outline is as follows:
Designing and pattern cutting: As per the selected designs, the patterns are prepared, checked for accuracy, and then master patterns are developed. Then these patterns are graded into different sizes and dies are prepared.
Clicking: The upper, lining and sock components are cut from suitable materials by the help of dies with the clicking press. While clicking, it is essential to consider the importance of the components and the corresponding portion of leather, directional properties of components and that of leather portion, degree of defects, and the best possible inter lock to have minimum wastage. The components are to be necessarily marked with sizes and sides are kept separately to avoid the confusion.
Closing: The cut components are checked to sizes and defects, skived to the edges, folded and other edge treatments are done as per specification. These are then assembled together initially with adhesive and finally with stitching. The eyelets are fixed, the upper is checked and then sent for next operation.
Bottom components preparation: Bottom components such as the insole, toe-puff and stiffeners are cut from suitable materials and skived as per specification. The PVC sole is cleaned with the solvent like Methyle-Ethyle-Ketone (MEK) and the TPR sole is cleaned and applied with chemical primer (Halogen) and dried.
Construction and shoe making: The toe-puff, stiffeners are inserted between upper and lining at the toe and back part. The insole is fixed on the last and the upper is mounted (Lasting) onto it by pulling the toe part, back part and finally the side portion. The edges are hammered for smooth feather edge. The bottom filling is done into the cavity formed due to lasting. The surface is then scoured and roughened to get levelled but rough surface is then cleaned with solvent like MEK and dried. Both the sole and lasted upper surface are then applied polyurethane adhesive and allowed to dry completely. The dried surfaces are then reactivated to gain adhesion properties and then the sole is fitted on the lasted upper accurately and pressed under sole attachment machine for strong and permanent bond. In this condition the shoe is kept for few hours for a permanent shape.
Finishing:The upper and sole is then cleaned and finished with the wax and other finishing chemicals. The shoe is then de-lasted, cleaned from inside, inserted with stamped sock lining, the laces are attached, inspected and packed for dispatch.
Quality Control and Standards
The quality of children shoe has to be maintained as per buyer's specification. However, the main criteria for quality control are selection of suitable materials (especially the leather with required thickness, shade, strength and softness) cutting components from suitable portions of leather, assembling, regular stitching with suitable thread with specified stitch length and finishing, lasting, alignment, sole attachment, finishing and packing.
Production Capacity
| i) Children school shoes 90,000 Pairs of | Rs. 19200000 |
| ii) Children fancy shoes 90,000 Pairs of | Rs. 30000000 |
| Motive Power | 20 HP. |
Pollution Control
Although shoe industry does not discharge any pollutants, the following precautions are to be considered for a better environment:
The adhesives prescribed are mainly solvent based and are inflammable and toxic in nature. It can cause problems, if inhaled. Therefore, a solvent extraction system is required in adhesive application area. Further the dust developed during scouring and roughing or even during finishing are necessarily to be collected through an exhaustion system attached to the concerned machine for making the work place dust free.
Energy Conservation
All machines are power driven and are run individually, whenever required.
Financial Aspects
Fixed Capital
| (i) Land and Building | |
| Land 500 sq. mtr @ Rs 3500/- per sq.mtr | 1750000 |
| Office building, Lab. Store 100sq.mtr. @ 7000/mtr. | 700000 |
| Floor area construction ,factory shed, Boundary wall etc. 300 sq.mtr. @ 5000 | 1500000 |
| Total | 3950000 |
(ii) Plant and Machinery
Name of the Machine and Specification |
Ind/ Imp |
Qty (Nos.) |
Price (Rs) |
Total (Rs) |
| Swing arm hydraulic clicking press, 16 ton | Ind | 1 | 220000 | 220000 |
| Pneumatic stamping machine-stamping wheel (0-9 Nos,) (A-Z) | -do- | 1 | 110000 | 110000 |
| Upper Skiving machine | -do- | 2 | 60000 | 120000 |
| Flat bed single needle sewing machine | -do- | 3 | 30000 | 90000 |
| Post bed single needle sewing machine | -do- | 3 | 54000 | 162000 |
| Roughing and Scouring machine | -do- | 1 | 4,000 | 45000 |
| Reactivation chamber | -do- | 1 | 22000 | 22000 |
| Pneumatic Sole attachment machine | -do- | 1 | 70000 | 70000 |
| Combined finishing machine | -do- | 1 | 36000 | 36000 |
| Pneumatic de-lasting machine | -do- | 1 | 30000 | 30000 |
| Spray booth and spray gun | -do- | 1 | 13000 | 13000 |
| Air compressor and distribution system | -do- | 1 | 23000 | 23000 |
| Lasting jack | -do- | 10 | 60000 | 60000 |
| Cost of tube well, OHD, Water Supply system | 100000 | |||
| Excise, sales tax & erection and installation charges 40% of total of 1 to 13 | 400400 | |||
| Total | 1501400 | |||
(iii) Tools and Equipments and Other Fixed Assets
Name of the Equipments |
Ind/ Imp |
Qty (Nos.) |
Price (Rs) |
Total (Rs) |
| Shoe designer's tool kit | Ind | 2 set | 5000 | 10000 |
| Shoe maker's tool kit | -do- | 10 sets | 2500 | 25000 |
| Machine maintenance and electricians tool kit | -do- | 1 set | LS | 5000 |
| Clicking dies-2 sets each | -do- | 20 sets | 7200 | 144000 |
| PVC last | -do- | 200 prs. | 600 | 120000 |
| Clicking pads, spray gun, and other misc. equipment | -do- | LS | 48000 | |
| Testing equipments-thickness gauge, measuring scales etc. | -do- | LS | 30000 | |
| Workshop tables, racks etc. | -do- | LS | 100000 | |
| Office furniture and equipments | -do- | LS | 200000 | |
| Total | 682000 | |||
| (iv) Total Plant and Machinery, Tools and Equipments, Furniture and fixture and Other Fixed Assets (ii + iii) | 2183400 | |||
(v) Pre-operative Expenses
(Rs.) |
|
| Preparation of project report and consultancy | 100000 |
| Administrative expenses | 20000 |
| Travelling, Market development and tie-up | 50000 |
| Other formalities and expenses prior to production | 50000 |
| Total | 220000 |
Total Fixed Capital Requirement
(Rs.) |
|
| Land & Building | 3950000 |
| Plant & Machinery | 1501400 |
| Tools & other Equipments | 682000 |
| Other Pre-Operative Expensive | 220000 |
| Total | 6353400 |
B. Working Capital (per month)
(i) Raw Materials (Including Packaging Materials) (per month)
Name of the Materials |
Quantity |
Unit |
Price (Rs.) |
Total (Rs.) |
| Chrome tanned cow softy upper leather Black colour (1.2 mm) | 10000 | Sq.ft. | 60 | 600000 |
| Chrome tanned cow softy upper leather Fancy colour (1.2 mm) | 13000 | Sq.ft | 70 | 910000 |
| Lining leather (1.0 mm) | 7500 | Sq.ft | 28 | 210000 |
| Drill Cloth for lining | 600 | meters | 40 | 24000 |
| Cellulose Board | 750 | sheets | 125 | 93750 |
| PVC soles Children school Shoes | 8000 | pairs | 34 | 272000 |
| PVC/ TPR soles for fancy shoes | 8000 | pairs | 50 | 400000 |
| Adhesive- rubber Solution | 150 | liters | 120 | 18000 |
| Adhesive- polyurethane | 300 | liters | 180 | 54000 |
| Adhesive- polychloroprene | 150 | liters | 120 | 18000 |
| Eyelet, lace and thread and other grindery | 10 | Per pair | 15000 | 150000 |
| Packing materials | 8 | Per pair | 15000 | 120000 |
| Total | 2869750 | |||
(ii) Salary and Wages (per month)
Personnel For Workshop
Name of the Post |
Numbers |
Salary (Rs.) |
Total (Rs.) |
| Production manager (Leather technologist) | 1 | 20000 | 20000 |
| Designer | 2 | 9000 | 18000 |
| Supervisors-Technical | 2 | 7000 | 14000 |
| Skilled worker/ Machine operator | 30 | 6000 | 180000 |
| Semi skilled worker | 20 | 4500 | 90000 |
| Unskilled worker | 8 | 3000 | 24000 |
| Electrician and mechanic | 2 | 5000 | 10000 |
| Total | 356000 | ||
Personnel For Administration
Name of the Post |
Numbers |
Salary (Rs.) |
Total (Rs.) |
| Accountant cum Cashier | 1 | 8000 | 8000 |
| Store Keeper | 1 | 4500 | 4500 |
| Watchman | 2 | 3000 | 6000 |
| Total | 18500 | ||
| Total Salary and Wages per month (i+ii) | 374500 | ||
| Add 20% perquisites | 74900 | ||
| Total | 449400 | ||
(iii) Utilities (per month)
Amount (Rs.) |
|
| Electricity | 15000 |
| Total | 15000 |
(iv) Other Contingent Expenses (per month)
Description |
Amount (Rs.) |
| Repair and maintenance | 7500 |
| Other consumable | 10000 |
| Insurance | 6000 |
| Travelling Expenses | 10000 |
| Telephone, fax and other postal expenses | 10000 |
| Stationery and printing | 10000 |
| Other miscellaneous expenses | 20000 |
| Total | 73500 |
| (v) Total Recurring Expenses (per month) (i+ii+iii+iv) | 3407650 |
vi) Total Working Capital
| Requirement for 1 and half Months Rs. 1.5 x 3407650 | 5111475 |
C. Total Capital Investment
| Fixed Capital | 6353400 |
| Working capital | 5111475 |
| Total | 11464875 |
Financial Aspects
Cost of Production (per annum) |
Amount (Rs.) |
| Recurring Expenses | 40891800 |
| Depreciation on Machinery @10% | 150140 |
| Depreciation on Building@ 5 % | 197500 |
| Depreciation on Tools and Equip.@ 25% | 170500 |
| Depreciation on Furniture and Fixture @20% | 20,000 |
| Interest on Total capital investment @ 12% | 1634040 |
| Total | 43063980 |
| or Say | 43063980 |
Expected Sales (per annum)
| Children school shoes | 80,000 pairs @ 250 | 19200000 |
| Children fancy shoes | 100,000 pairs @ 300 | 30000000 |
| Total | 49200000 | |
Net profit (per year)
Expected Sales – Cost of Production |
|
| 49200000- 43063980 | |
| = 6136020 |
Net Profit Ratio
Net Profit (per year) x 100 Turn-over (per year) |
|
| 12.47% |
Rate of Return on Total Investment
Net Profit (per year) x 100 Total Investment |
|
| 14.25% |
Break-even Point
Fixed Cost
Description |
Amount (Rs.) |
| Depreciation on building(@5%) | 197500 |
| Depreciation on machinery(10%) | 158310 |
| Depreciation on office equipment(20%) | 20,000 |
| Insurance | 48,000 |
| Interest on total capital(12%) | 1634040 |
| 40% of salary | 2157120 |
| 40% of other contingencies and utilities | 223200 |
| Total Fixed Cost | 4,285,670 |
| B.E.P | Fixed cost x 100 ---------------------------- Fixed cost + Profit |
| 41.12 |
Addresses of Manufacturers and Suppliers of Machines
- NSIC Technical Service Centre
Sector B-24, Guindy Indl. Estate,
Ekkaduthangal, Chennai-32
- M/s. Atlanta Trading (P) Ltd.,
ATUR House, Worli Naka,
Mumbai - 18 - M/s. Twin Star Engineering,
No. 98, Pammal Main Road,
Pammal, Chennai- 75 - M/s. S.P. Engineering Works,
Dayal Bagh Road, New Agra-5 - M/s. Raj Machine Home,
Opp. New Jyoti building,
35/44 Karabala Road,
Agra-5
Raw Material Suppliers
- M/s. Alpha Global,
445/1, 6th Cross, 7th Block,
Jayanagar KPM Road,
Bangalore - 560 082 - M/s. Amjad Finished leather Co.
54 maddox street, Choolai,
Chennai - 112 - M/s. Arkay Leathers,
No.-3,Third Floor,
Crown Court, 34,
Chathedral Road,
Chennai- 86 - M/s. Mow Chung Tannery Pvt. Ltd.
47, South Tangra Road,
Kolkata- 46. - M/s. Anka India Ltd.
Vand PO – Kherki Daula,
Gurgaon, - 122001(Haryana)
(for soles) - M/s. Chem Crown India Ltd.
Real Chambers, Maddox,
3rd Floor, Vepery,
Chennai- 600 012 - M/s. Enkay HWS India Ltd.
B-3 S.M.A. Co-op Ind. Estate,
G.T. Karnal Road,
Delhi - 110 033
(for soles) - M/s. Flexolle Raman Ltd.,
Mysore – Ooty Road,
Thandavapura – 571 325
(for insole) - M/s. Pidilite Industries Ltd,
J.B.Marg, Nariman Point,
Mumbai
(for adhesive) - M/s. APL Poly Fab Pvt. Ltd.,
48 C, Matheswar Tala Road,
Kolkata- 46
(for lining) - M/s.M/s. Coats India Ltd,
144, M.G. Marg,
Bangalore-01
(for stitching thread) - M/s. Asia International,
1523, Qasimjan Street,
Lal Kuan, New Delhi
(for fasteners)
For further information please contact
Information Manager
TIMEIS Project
E-mail: timeis@ficci.com
