Gents Leather Long Boot (Welted)
| Product Code | 291101003 |
| Quality and Standards | BIS has specified the following certain specifications which can be followed for manufacturing a long boot welt with double insole
|
| Production Capacity | Quantity : 60,000 pairs (per annum) Value : Rs. |
| Uploaded on | March 2007 |
Introduction
Footwear has come a long way from its humble beginning. It is no longer just a functional necessity, but rather, something that is flaunted as a fashion statement. In earlier days, a person was considered well heeled if he had a pair of formal shoes, a pair of chappal and may be one pair of sandal foot casual footwear. Today's average consumer is more conscious of his image and more selective in his preference. He is interested in variety and style all this has helped the boom of the footwear industry. Gents Leather long boot welted with double insole is one of the sophisticated items of footwear industry. Footwear industry is one of the major export oriented industries in India. The raw materials for the manufacture of these boots are indigenously available. There is no dearth of raw material as well as labour for the manufacture of the boot because these are available locally.
Market Potential
Footwear industry is one of the major foreign exchange earners of India. Out of the export of around Rs. 7000 crores today leather goods and footwear constitute about 83% and finished leather about 15%, a real leap forward. In 1999-2000 finished leather fetched Rs. 1035 crores, from leather footwear, Rs. 1,433 crores, from footwear component, Rs. 994 crores from leather garments, Rs. 1380 crores and other leather goods Rs. 155 crores. The demand of the boot is increasing in the overseas market as well as internal market. In international market, the demand is increasing day-by-day as the export of boot is increasing every year.
Basis and Presumptions
Production of the boot is based on DOUBLE shift operation of 16 hrs. duration daily with 25 working days in a month. It has been presumed that the proposed unit will achieve 50% of its capacity in the first year of operation which will raise to 60%, 70%, 80% and 90% in second, third, fourth and fifth year respectively.
Sales revenue has been calculated on full capacity utilisation as given above. In the manpower projection, it has been presumed that the administrative and managerial staff will remain the same. Direct as well as casual labour will be utilized at 60% of their strength in first, second and third and 90% in the fourth and fifth year.
Depreciation has been charged on machinery at 10% on Boot last and tools @ 25%, office equipment @ 20% and interest on capital investment is taken at 12%.
Implementation Schedule
Activity |
Period (in months) |
| Registration and other formalities | 1 |
| Selection of site | 1 |
| Availability of finance/loan | 2 |
| Procurement of machinery | 3 |
| Erection and commissioning | 1 |
| Recruitment of labour | 1 |
| Total production | 1 |
| Total | 10 |
Technical Aspects
Process of Manufacturing
As per graded pattern of various sizes for upper and lining components are cut by clicking machine and sent to the closing section. In the closing section these upper components are skived and folded as per requirements. The lining is then stitched with upper on various sewing machines and excess lining is trimmed. Finally, the eyelets are fixed and the uppers are cleaned and ready for lasting.
In the making section the upper is lasted either by machine or by hand and rubber sole is attached to the upper by various processes like hand sewn, shock on process. The shoes are then finished by combined finishing machine, stamped and packed.
Quality Control and Standards
At present no quality specification for the particular boot. But for the export order specifications are provided by the buyer's only.
Production Capacity (per annum)
| Quantity | 60,000 pairs |
| Value | Rs. 1,02,00,000 |
| Motive Power | 10 HP. |
Pollution Control
Not applicable.
Energy Conservation
Regular power supply is required to run the unit smoothly as the sewing machines are motorised.
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 |
| GEN SET ,Water System(including borewell sanitation overhead tank) | 500000 |
| Total | 4450000 |
(ii) Machinery and Equipments
Description |
Imp./ Ind. |
Qty. |
Rate (Rs.) |
Value (Rs.) |
| Clicking Press | Ind | 1 | 150000 | 150000 |
| Skiving machine | Ind. | 1 | 80000 | 80000 |
| Stamping machine | Ind. | 1 | 35000 | 35000 |
| Punching and Eyeleting | Ind. | 1 | 36000 | 36000 |
| Flat bed Industrial sewing machine | Ind. | 6 | 11000 | 66000 |
| Zig-Zag Sewing machine | Ind. | 2 | 15000 | 30000 |
| Cylinder bed sewing machine | Ind. | 2 | 18000 | 36000 |
| Post bed sewing machine | Ind. | 2 | 18000 | 36000 |
| Fore Part Lasting machine | Imp. | 1 | 850000 | 850000 |
| Side and Seat lasting machine | Imp. | 1 | 1000000 | 1000000 |
| Combined finishing machine | Ind. | 1 | 90000 | 90000 |
| Cementing press-four bed operated with Air compressor 1 HP motor | Ind. | 1 | 35000 | 35000 |
| Wooden Last | 250 | 350 | 87500 | |
| Tools and Equipments | 70000 | |||
| Office equipments and furniture | 100000 | |||
| Erection,electrification Installation . Exise and others leverages @ 40% total 1 to 15 | 1080600 | |||
| Total | 3782100 | |||
| (iii) Pre-operative Expenses | 80000 | |||
| Total Fixed Capital (i+ii+iii) | 8312100 | |||
B. Working Capital (per month)
(i) Staff and Labour (per month)
Designation |
No. |
Salary (Rs.) |
Total (Rs.) |
| Production Manager | 2 | 15000 | 30000 |
| Designer | 1 | 10000 | 10000 |
| Supervisor | 2 | 7000 | 14000 |
| Accountant-cum-Cashier | 1 | 7000 | 7000 |
| Clerk-cum-typist | 1 | 5000 | 5000 |
| Mechanic | 1 | 6000 | 6000 |
| Machine Operator/ Skilled Worker | 30 | 6000 | 180000 |
| Semi-skilled workers | 15 | 4000 | 60000 |
| Store keeper | 1 | 3500 | 3500 |
| Peon/Chowkidar | 1 | 3000 | 3000 |
| Sweeper | 1 | 3000 | 3000 |
| Total | 321500 | ||
| Add perquisites @ 22% on Salary | 70730 | ||
| Total | 392230 |
(ii) Raw Materials including packing requirements (per month)
Description |
Qty. |
Rate (Rs.) |
Value (Rs.) |
|
| Upper Leather | 175000 | dcm | 4.5 | 787500 |
| Softy lining | 100000 | dcm | 3.0 | 300000 |
| V.T. Sole for Insole, Toe puff and Stiffener | 1750 | kgs. | 140 | 245000 |
| Fabric lining | 500. | mts | 40 | 20000 |
| Rubber Sole | 1000 | sheets | 450 | 450000 |
| Grinderies | 5000 | pairs | 24 | 120000 |
| Packing material | 5000 | pairs | 15 | 75000 |
| Total | 1997500 | |||
(iii) Utilities (per month)
Amount (Rs.) |
|
| Power | 15000 |
| Total | 15000 |
(iv) Other Contingent Expenses (per month)
Description |
Amount (Rs.) |
| Postage and Stationery | 5000 |
| Transportation charges | 20000 |
| Repair and Maintenance | 10000 |
| Consumable Stores | 15000 |
| Advertisement and Publicity | 50000 |
| Telephone& internet | 5000 |
| Insurance | 8000 |
| Miscellaneous Expenses | 15000 |
| Total | 128000 |
(v) Total Working Capital (per month)
Description |
Amount (Rs.) |
| Raw Materials | 1997500 |
| Staff and Labour | 392230 |
| Utilities | 128000 |
| Other contingent expenses | 128000 |
| Total | 2645730 |
(vi) Working Capital (for 1 1/2 months)
| Rs. 2645730 x 1.5 | 3968595 |
C. Total Capital Investment
| Fixed Capital | 8312100 |
| Working capital (for 1.5 months) | 3968595 |
| Total | 12280695 |
Machinery Utilisation
All sewing machines, skiving, clicking, buffing and roughing are the major machines, which are expected to be utilized upto 80%.
Financial Aspects
Cost of Production (per annum) |
Amount (Rs.) |
| Total recurring cost | 31748760 |
| Depreciation on machinery @ 10% | 253150 |
| Depreciation on Building@5% | 222500 |
| Depreciation on equipments @ 25% | 17500 |
| Depreciation on office equipments @ 20% | 20000 |
| Depreciation on wooden last @ 25% | 21875 |
| Interest on Total Capital Investment @ 12% | 1473683 |
| Total | 33757468 |
Turnover (per year)
Items |
Qty. |
Rate/pairs |
Value (Rs.) |
| Boots in pairs | 60000 | 600 | 36000000 |
| Total | 36000000 | ||
Net Profit (before taxation) (per year)
Turnover - Cost of Production |
|
| 36000000- 33757468 | |
| = 2242532 |
Net Profit Ratio
Net Profit per year x 100 Turnover per year |
|
| 2242532 x 100 | |
| 36000000 | |
| 6.23 |
Rate of Return on Total Investment
Net Profit per year x 100 Total Investment |
|
| 2242532 x 100 | |
| 12280695 | |
| 18.26 |
Break-even Point
Fixed Cost
Description |
Amount (Rs.) |
| Depreciation on machinery @ 10% | 253150 |
| Depreciation on Building@5% | 222500 |
| Depreciation on equipments @ 25% | 17500 |
| Depreciation on office equipments @ 20% | 20000 |
| Depreciation on wooden last @ 25% | 21875 |
| Interest on Total Capital Investment @ 12% | 1473683 |
| 40% of Salary and Wages | 1882704 |
| 40% of utilities and other Contingent expenses | 576000 |
| Total | 4467412 |
| B.E.P | Fixed cost x 100 ---------------------------- Fixed cost + Net Profit |
| 4467412 x 100 | |
| 4467412 + 2242532 | |
| 66.58% |
Addresses of Machinery and Equipment Suppliers
- M/s. S.P. Engineering Works,
Dayal Bagh Road,
New Agra,
Agra.
- M/s. Technical Service Centre,
(NSIC),
Sector B-24,
Guindy Industrial Estate,
Ekaduthangal Post,
Chennai-600 097. - M/s. Harman Sales Union,
24, Kala Bhavan,
Mathew Road,
Mumbai-400 004. - M/s. Benson Industries,
96, Sri Arbindo Road,
Salkia, Howrah,
West Bengal. - M/s. Bharat Sales Agencies,
Gresham Assurance House,
3rd Floor, Sir P.M.Road,
Mumbai-400 001. - M/s. Leather Packing Machinery Corpn.,
1/23-B, Asaf Ali Road,
New Delhi.
- M/s. Paul Bros. and Co.
642, Anna Salai,
Thousand Light,
Chennai-600 006. - M/s. Footform,
30, Banerjee Para Road,
Sarsuna, Kolkata. - M/s. Precision Shoe Last Factory,
60, Industrial Estate,
Nanhai,
Agra-6, U.P. - M/s. Sanghri Shoe Accessories Pvt. Ltd.
11, Harikripa, 10th Road,
Mumbai-400 071.
Raw Material Suppliers
- M/s. T. Abdul Waheed and Co.
26, Vepari High Road,
Chennai-600 003. - M/s. Valliappa Leather Corpn.
3/5 & 6, Narayana Chetty Street,
Periyamet,
Chennai-600 003. - M/s. Abdul Khander and Co.
8, Kumarappa Chetty Street,
Periyamet,
Chennai-600 003. - M/s. Shafeeq Shameed and Co.
26, EVR Sampath Road,
Vepari, Chennai-600 007. - M/s. Farida Prime Tannery,
936, Periyar EVR High Road,
Chennai-4. - M/s. Modi Threads,
Modi Nagar,
Meerut, U.P. - M/s. Synfhokem Industries,
5, Hindi Prachar Sabha Street,
Chennai-600 017. - M/s. Pidilite Industries Ltd.
244, Louds Road,
Gopalapuram,
Chennai-600 086. - M/s. Bharani Agencies,
126, Thambhu Chetty Street,
Third Floor,
Chennai-600 001. - M/s. Golden Chemicals (P) Ltd.
Vile Parle, Mumbai - 56. - M/s. Allied Resin Chemicals Ltd.
134/1, M.G.Road,
Kolkata - M/s. Swastic Chemicals
Industries (P) Ltd.
Vile Parle,
Mumbai - 56 - M/s. Indogil Chemicals Industries,
Ticoieon House,
Dr. E. Moses Road,
Mumbai.
For further information please contact
Information Manager
TIMEIS Project
E-mail: timeis@ficci.com
