DECLERATION

The Project on business proposal been submitted by Rohit Gupta ENR IBR

4023&Saurabh Singh ENR 4015. As all Academic project is on original work

executed on date 28-10-10. It is the original work done by us. This is the

property of the Institute and use of this report without prior permission of the

Institute will be considered illegal and actionable.

Date:- 31-10-10

Signature Signature

Rohit Gupta Saurabh Sing

IBR 4023 IBR 4015

PGDIB PGDIB

1 | P a g e

ACKNOWLEDGEMENT

The successful completion of this dissertation would not have been

possible without the support and cooperation of others. We must first

thank God, who makes all things possible. We know that this project was

not our individual achievement, but the result of many people to whom we

will be forever grateful. It is not until you undertake a project like this

one that you realize how massive the effort it really is, or how much you

must rely upon the selfless efforts and goodwill of others. We would be

failing in our duty if we do not express our deep sense of gratitude to

those who have been kind enough to help us in preparation of this report.

We are grateful to Dr. D.K. GARG, CHAIRMAN, ISHAN INSTITUTE OF

MANAGEMENT & TECHNOLOGY for his everlasting support and

guidance on the ground of which have acquired a new field of knowledge.

The course structure created for this curriculum has been benefited with

inclusion of recent development in the organization and the managerial

aspects. I would also like to thank our coordinator who supported me and

encouraged me to complete this project.

Saurabh Singh

IBR 4015

PGDIB

Rohit Gupta

IBR 4023

PGDIB

2 | P a g e

the taste of your choice…..

3 | P a g e

THE CAKERY FOOD

TABLE OF CONTENTS

S.NO Particulars Page No.

1 Preamble 5

2 Purpose of study 6

3 The business 7-9

4 Manpower requirement 10

5 Plant & Machinery requirement 11-12

6 Start up cost 13

7 Sale forecast 14

8 The location 15

9 Product & Market segmentation 16-19

10 Competitor 20-23

11 Technical Knowhow 24

12 Plant Layout 25

13 Demand of the Product 26

14 Why We are interest in this project 27

13 Taxation 28

14 Legal aspect 29-30

15 Conclusion 31

4 | P a g e

PREAMBLE

Entrepreneurship is the practice of starting new organizations or revitalizing mature

organizations, particularly new businesses generally in response to identified opportunities.

Entrepreneurship is often a difficult undertaking, as a vast majority of new businesses fail.

Entrepreneurial activities are substantially different depending on the type of organization

that is being started.

The food industry is a thriving sector in the Indian economy and holds approximately 4% of

the Indian GDP. We should note that the Bakery food has seen in the past few years a growth

in the sales and revenues between the periods of 2004 to 2009. However, with the economic

downturn that the world is currently experiencing the IRFA (Indian Restaurant &

Foodservice Association) is predicting a decline of the industry between 2008 and 2009.

Indian People love to eat. We find the social environment of food product the perfect break

from cooking, and relish the adventure of tasting new menus. People of India spend lavishly

on their eating habit; we take the advantage of this habit of them.

We herein The cakery food product strive to deliver the products with the green ambience

which the customers won’t find elsewhere. Quality of products is paramount to us.

Vegetarian people need not to travel here and there for the Bakery food product, we will

provide them the best Cake and pastry they can ever have.

Our motto is to provide quality products to the customers so that they demand our

product again and again.

We try to make small contribution to the environment by using paper for packaging of

our products.

We believe that business enterprise is never complete if it doesn’t make contribution

beyond building a good business. So we constantly work to improve the quality of

people whosoever is associated with us.

We try to ensure that the customer is getting best service from us.

We will be taking the feedback of the customers and look for modification of our

products and services in response to the feedback.

5 | P a g e

PURPOSE OF STUDY

The objective of this project “Business Proposal” is to get insight the real business scenario.

It will help us to grow as entrepreneurs because they are the need of our growing economy.

There is large opportunity in every sector waiting to be exploited for sustaining the growth of

our nation. In this project we will learn how to commence a business ,how to take the

strategic decisions such as developing vision & mission for the organization , selecting the

particular business, looking for the strategic location for the growth of the business, chalking

out the production & marketing plan. It will also help us to understand the dynamism of the

market & will nurture the customer centric approach in us. Being an essential part of our

course curriculum this project brings out our hidden qualities & natural creativity that are

must for the successful completion of this project.

We have found that as “an owner you will get to know a lot of people. It is very social

business, with lots of invitations to social events and private parties. You will be on a first-

name basis with people who have power and prestige: the conductor of the symphony, the

coach of the football team, the mayor, television celebrities, and so on. When they will use

your services, you are the one they want to talk to. It makes them feel important, so they will

seek you out to become your friend.” The following information should serve as a guide in

helping you make that decision. The information provided is by no means meant to be all-

inclusive, but it will, we hope, provide some useful guidelines to help in your decision

making. The purpose of the study also rotates around the fact whether we ourselves are going

to start the business or the other would take a valuable suggestion. In both the case the

purpose of the study would be fulfilled.

Our purpose of study can be summarized as follows:-

To increase knowledge base.

To develop entrepreneurial skill.

To understand business aspects and complications.

To give a virtual existence to our future business

6 | P a g e

THE BUSINESS

“Bakery Food is something one can’t stay away with; we also love to taste variety of

food”. This statement motivates us to go for the Bakery business in India. We have

suggested for Bakery food product because up till now there is no branded Bakery food

product which sells exclusively Bakery food. THE CAKERY FOOD PRODUCT is a new

Bakery product manufacturer which primarily sells Bread, Cake, Cream roll, pastry, pao,

toast. The punch line of The Bakery Food Product is “THE TASTE OF YOUR CHOICE.”

Vision

To become the most preferred Bakery product manufacturer among the people by treating the

people in the way they like to be treated and give them best for the least.

Mission

The Cakery Food Product aims to be a cornerstone in the community creating a

neighbourhood atmosphere where customers feel comfortable and become instant regulars.

We seek fair and responsible profit, enough to keep the company financially healthy for the

long term and to fairly compensate for our money and risk.

Objectives

1. To establish a working storefront for The Cakery food Product bakery.

2. To develop the strong presence in the community needed to support sales goals.

3. To develop a full menu by the end of first 100 Days.

4. To provide the true flavour of India at reasonable cost.

Company Ownership

Currently The Cakery food Product Bakery is a partnership firm of two partner which are

Rohit Gupta and Saurabh Singh . Eventually, as the company becomes established, The

Cakery food Product Bakery will apply to be incorporated.

Company Summary

The Cakery food Product Bakery will be located in Nani which is Very peace full and green

atmosphere. This Town is a very popular destination because of the historical architecture

7 | P a g e

for weekenders and tourists. It is also a prime location for all the employees of the

surrounding bakery businesses. The bakery sells non-wheat and other health specific breads,

sweets and pastries to the surrounding community every 24*7.

Customers: -

Customer is the ultimate Boss for any company, he has the power of even sacking the owner

of the company, the only thing he will do that he will not purchase the products of the

particular company, so before starting of any business entrepreneur should have clear idea of

whom to target. We target the middle and upper middle class people area who like to have

bakery food. Mainly our target is ultimate User consumer and children. The Cakery food

Product will focus on three distinct customer segments area.

Management Team:- Recognizing the importance of human capital, The Cakery food

Product has assembled a strong management team. Most important to the cakery food product

is the financial success which will be achieved through strict financial controls. Additionally

success will be ensured by offering high quality services and extremely clean and healthy

food with Indian taste.

The Cakery food Product is an exciting opportunity that combines, fresh

baked goods with bread, cake products, addressing the recent need for these new products.

Demand for these products is expected to grow exponentially as our target market .Through a

combination of a strong management team, a solid business model, and exciting, market

demanded products will allow The Cakery food Product to quickly gain market penetration

and cash richness.

Marketing

Marketing means creating awareness and willingness in the customers to purchase the

products. Marketing is one of the most important aspects of the business because without

awareness of the products it cannot be sold.

We planned to sell our products with the fallowing advertisement strategy

We will attach a leaflet shaped paper pamphlet to all the leading newspaper in Allahabad.

On the leaflet there will be a description of our particular and on the back of leaflet there

will be a quotation about the nutritional value of particular product but there will be

8 | P a g e

nothing in the quotation that will be affect the sentiments of non vegetarian people

because after all they will also be our customers.

Before 15 days of inauguration of our business we will seek permission from the

respective Authority for putting the holding about our product. On holding we will keep

information about our product, the pamphlet will be large enough so that the information

will be visible to the people.

We also provide our products free home delivery.

SWOT Analysis:-

Strength:

No branded bakery food product which sells exclusively Cake and Pastry. It provides variety

of cake , Bread, cream roal, toast, and Cake formed by different Flavour which give the

customer an Indian taste.

Weakness:

There is a risk in starting this business because it will be first of its kind.

Threats:

There is no direct competitor as such but we can consider local player of the particular area as

our competitors because they are selling same product with low cost. If talk about

International player Britannia also provides some same product, Britannia is also well

recognized brand among the customer and its sales are maximum among the various products

in India which is a major threat.

Opportunity:

There is a large customer base, as India is having maximum number of vegetarian peoples.

Indians spend around 51% of their personal expenditure on their eating habit.

9 | P a g e

MAN FORCE REQUIREMENT

Salary /month

Designation No. of employee Salary/employee Total

Accountant 1 8000 8000

supervisor 1 6000 6000

Baker 2 4000 8000

Helper 4 2500 10000

Sweeper 1 2000 2000

Order taker 2 5000 10000

Total 44000

10 | P a g e

PLANT AND MACHINERYLand & Plan manufacturing cost

Land require 150 yard@1800 270000

Legal cost - 10000

Total cost 280000

Construction cost

Office 1 room

Store Room 1 room

Manufacturing 1 room

Toilet/bathroom 1 room

Total cost 230000

Net total 510000

11 | P a g e

MACHINERY COST

Machinery no. Price

Gas/electric 5 deck oven (China) 1 68000

Bread slicer 1 10000

Rotatary oven 1 25000

Dough driver 1 10000

Other equipment 1 20000

Generator 1 20000

Total 153000

12 | P a g e

START UP COST

Legal cost 5000

Advertisement cost 20000

Electricity cost 5000

Plumbing cost 5000

Insurance 5000

Bakery Ingredient 110000

Bakery accessories 10000

Packing material 20000

Other cost 10000

Administrative cost 10000

Net cost 200000

*Cash in hand 93000

13 | P a g e

SALES FORECOST

Sale forecast for first 100 days

Product Name No. sales @rate (Rs) Total(Rs)

Cakery bread

250 gm 2500 20 50,000

180 gm 3000 15 45,000

Cakery cake

350gm 500 100 50,000

550gm 400 150 60,000

750gm 300 200 60,000

Cakery toast

44 pieces 350 45 15,750

22 pieces 550 25 13,250

Cakery Pastry

6pieces/box 1000 30 30,000

Cakery cream roll

5pieces/pack 1000 30 30,000

Cakery Pao

12pieces/pack 1200 20 24,000

20pieces/pack 800 30 24,000

Single pao 5000 3 30,000

Total 4,32,000

14 | P a g e

THE LOCATION

For any business player location plays a vital role. The success and the future of the company

depends on that place from where selling of the product and availability the required raw

material is feasible and in least possible cost. Location- our preferable location is Nani

Allahabad near the Nani railway station.

Reasons for Investing:-

Nani consists of Economic area of Uttar Pradesh, as we know that Nani is well known

Junction in northern railway and also have some important factors which are..

Cheap land, labor cost which are very essential for starting any business.

The location of the Cakery food product is easily reachable location for our target market

so cheap transportation cost occurring during supply and receiving the goods.

Easily availability of Supplier and raw material.

No branded bakery is present in this area, a monopoly type situation in the bakery

business in this area.

Very peace full and green atmosphere.

Another thing to consider is whether or not this is a high crime area, people may not stop

if they don't feel safe. Destruction of property, robbery and employee safety is other

considerations.

Location:- Plant and target market

15 | P a g e

PRODUCT & MARKET SEGMENTATION

1.

2.

3.

16 | P a g e

Cakery White bread: - It available in different packing.

250 gm 180 gm

Cakery Cake:- It available in different packing.

350 gm 550gm 750gm

Cakery Pastry:- it is available in box packing which containing 6 pieces in a box.

4.

5.

6.

17 | P a g e

Cakery Cream roll:- it is available in five pieces packaging.

Cakery Pao: - It’s available in two packaging.

200 gm or 12 Pieces/ pack. 300 gm or 20 Pieces/pack.

Cakery Toast:- it is available in two different packaging.

600 gm or 44 pieces/ pack. 300 gm or 22 pieces/ pack

Market Segments: - The Cakery food product provides wide range of the Bakery product

such as Cake, pastry, Bread, Cream roll, Toast and Pao which are very common and favorite

choice of the middle class and upper middle class people and they takes bakery product as a

snacks and breakfast so company three target three segment of the market which are also

include the youth and children it means teenagers group.

The first group area is the college area. This segment is growing at 25% a year with

32,000 potential customers.

The second niche is the working man group. This segment is also growing at 20% with

40,200 potential people.

The last group is the house hold group. This segment is typically making modifications to

their diet. This niche also is growing at 15% with 4,80,000 possible customers.

Target Market Potential Customer

Allahabad (City) 12,15,348

Mirzapur 2,05,264

Target Market Segment Strategy :-

In our target market, we will mainly focus on the "Teenagers group" since they are the most

prevalent and steady of customers. We expect that the "working man group" and the '"house

hold" group will make up a smaller portion of our customers. We have not listed "regular

customers" as a target group since the customers who do not fit into any of our groups are too

varied to segment. We are specifically filling the needs of the "house hold group" so we

expect the most business from this group.

Industry Analysis

The estimate made by the Ministry of Food Processing Industries, the total market of bakery

product, bread and biscuit is estimated at 1.5mn ton and 1.1mn ton respectively. The cake

market is estimated at 0.4mn ton. The organized segment of the biscuit market is estimated to

be 0.44mn tons whereas the unorganized sector accounts for the balance 0.66mn tons. Bread

market is estimated to be growing at around 7% pa in volume terms, whereas the biscuit

18 | P a g e

market in the recent years has witnessed a little higher growth at around 8-10% pa. Within

the biscuit category, cream and specialty biscuits are growing at faster pace at 20% pa, while

the popular segment is growing.

The Cakery food Product bakery competes in the Food Services Industry. In

addition to competing with other organic and non-wheat bakeries, it competes with all

restaurants, delis, bakeries and supermarkets for a share of its customers’ food dollar. The

Cakery food Product is most concerned with competitors who differentiate their products and

services with a healthy, organic focus. Because this group is so large, The Cakery food

Product has chosen to limit its analysis to other gluten-free bakeries.

19 | P a g e

COMPETITOR

Local player

Varanasi

A. Bread of the life bakery

Address

Shivala, Near Agrawal Radio,

Shivala, Varanasi - 0542 2275012

B. Prince baker’s

Address

 The Mall Rd, varunapul (near hotel radission),

varanasi - 0542 3200523

C. Sweet home bakery

Address

Rathyatra, Varanasi - 0542 2363071

D. Shiva Cafe & German Bakery

Address

D 26/4, Narad Ghat,

Himalaya Lodge, Narad Ghat, Varanasi

E. Cake & Bake

Address

Jagatganj, Varanasi - 09936090187

F. New Raja bakers

Address

Katalmil Gate, Varanasi - 0542 2214530

20 | P a g e

Local player

Allahabad

Friend forever

Address

13/13, SARDAR PATEL MARG CIVIL LINES,

Allahabad 0532 2261228

Rama Biscuit Bakery

Address

211, Noorulla Road, Allahabad – 211001

Jay Bakery177/22, Noorullah Road, Allahabad – 211001

21 | P a g e

Paradise Confectionaries

19/35, M.G Road, Civil Lines, Allahabad – 211001

Saxena Agencies

67/64, Zero Road, Allahabad – 211003

NCR region

Palki Foods India Private Limited

G-164 sector 63, opposite Fortis Hospital Sector 62,

New Okhla Industrial Development Area,

Uttar Pradesh – 09971499770

Continental Equipment India P Ltd

B-66, Okhla Industrial Area Phase-i

New Delhi -011 26816298

Cookie Man ( Australian Foods India Private Limited)

Mehrauli Gurgaon Marg, 14GF, Ground Floor

MGF Metropolitan Mall

Gurgaon, 122 001 - 0124 4100788

22 | P a g e

23 | P a g e

TECHNICAL KNOW HOW

The great majority of developing countries including in India poor and suffer from over-

population and consequent higher rates of unemployment. The technology of advanced by

definition is capital –intensive, whereas the technology required in most developing countries

has to be employment-intensive. This is, therefore the basic contradiction. The transfer of

capital-intensive technology into developing countries is likely to worsen the employment

position as such technology would deny the unemployed the extremists, therefore, argue for

an almost total rejection of transferring western technology to Indian conditions. The

technical exists not in research laboratories, not in factories machines, nor in engineering

data, drawing and patents. It exists in the multi-disciplinary group consisting of scientists,

engineers, accounts, managers, operations and maintenance teams other groups who have

together developed the technology. So, in business, technology exists where it has been

assimilated and adapted successfully and is able to undergo diffusion. In fact the assimilation,

adaptation and diffusion of “know-how” results in technology. The technical knowhow

includes following components such as:

Quality of the product.

Specification of the raw materials inputs to various components.

Details of the plant & machinery and their layout.

Engineering and process flow chart, manufacturing instructions.

Load diagrams and material balance.

Control of operations, production and planning.

Managerial practice and data processing.

Scale of operations.

24 | P a g e

PLANT LAYOUT

OPERATION & PRODUCTION PLAN

LAYOUT & IMPROVEMENTS

The chosen location is selected for its high commercial and residential traffic situated at Nani

the elite class area of Allahabad. Key service industries include Education,

telecommunications, hotels, banking, and tourism are there. The crakery food product has

retained the services of traditional architectural for the conceptual development of the interior

design.

25 | P a g e

DEMAND FOR THE PRODUCT

Demand analysis is one of the important parts of any kind of business, before establishing

the business in market. According to our project it is necessary to find out new trend Bakery

product and past requirement of the market that the project which we are going to established

whether it is successful in that particular area or not. Consumption trend can be

measure ,through demand position or customer life style .Because in today’s scenario

customer needs best quality of baking product at cheaper rate it can be easily analyze

through current population of the our target customer area.

Demand trend only analyses through customer’s interest

of that particular area, Supply position of any market is depending on number of customer

available in that particular area. More the number of the customer more is the demand and

vice-versa. It mainly consist the market from where the businessman take the raw material it

is depend on the past and present respond of the customer. Nani is situated in the centre of

our large Papulation,In Allahabad if we talk about life pattern of the people ,mostly belongs

to middle class and teenagers they are mostly prefers bakery product such as Bread, Toast

and Pao as breakfast in comparison to fast food so they play important role increasing

demand of bakery product.

Allahabad is city having large number of people and there are also tourists

who visit the Allahabad to see its cultural heritage and Sangam.

26 | P a g e

WHY WE ARE INTERESTED IN THIS PROJECT

We are interested in this project because two of our neighbours are already in this business

and they are generating enough profit with this business. We had also organized a south

Indian food stall in ‘Kshitiz’ one of renowned festival of our college and we made profit.

This has inspired me to open a Bakery business.

In spite of this, We are a food loving person. I take interest in cooking and having different

varieties of meal. Secondly, through studies I found that bakery business is the fastest

growing business in India comparative to other businesses having lowest failure probability

and there is low tax liability apposed on the Bakery product in comparison to other type of

the business and very formal legal liability required for this business. Allahabad is the only

city where cheap land and labour are available. That’s why we have included availability of

resources in our Bakery business.

Being a Management student it’s always curious to be an entrepreneur. Opening a Bakery

business is also an entrepreneurship. So, all these create interest in me for this project.

27 | P a g e

TAXATION

As we know India known for the well-developed tax structure with clearly demarcated

authority between Central and State Governments and local bodies. Central Government

levies taxes on income (except tax on agricultural income, which the State Governments can

levy), customs duties, central excise and service tax.

Value Added Tax (VAT) (or Sales tax in States where VAT is not yet in force), Stamp Duty,

State Excise, Land Revenue and tax on professions are levied by the State Governments.

Local bodies are empowered to levy tax on properties, octroi and for utilities like water

supply, drainage etc.

In last 10-15 years, Indian taxation system has undergone tremendous reforms. They tax rates

have been rationalized and tax laws have been simplified resulting in better compliance, ease

of tax payment and better enforcement. The process of rationalization of tax administration is

ongoing in India.

Since April 01, 2005 most of the State Governments in India have replaced sales tax with

VAT. Service tax is levied at the rate of 10% (plus 2% education cess) on certain identified

taxable services provided in India by specified service providers. Service tax on taxable

services rendered in India are exempt, if payment for such services is received inconvertible

foreign exchange in India and the same is not repatriated outside India.

The CENVAT Credit Rules allow a service provider to avail and utilize the

credit of additional duty of customs/excise duty for payment of service tax. Credit is also

provided on payment of service tax on input services for the discharge of output service tax

liability If so, use the following method to "back into" they tax. You may choose to include

sales tax in the price of an item, rather than show the tax separately.

28 | P a g e

LEGAL ASPECTS

Prevention of Food Adulteration Act, 1954

This act is the basic statute that is intended to protect the common consumers against the

supply of adulterated food. This specifies different standards for various food articles. The

standards are in terms of minimum quality levels intended for ensuring safety in the

consumption of these food items and for safeguarding against harmful impurities and

adulteration. The central Committee for Food standards, under the Directorate General of

health services, Ministry of Health and Family Welfare, is responsible for the operation of

this act. The provisions of this Act are mandatory and contravention of the rules can lead to

both fines and imprisonment.

Objective

To protect the public from poisonous and harmful foods.

To prevent the sale of substandard foods.

To protect the interests of consumers by eliminating fraudulent practices

Standards on Weights and Measures (Packaged Commodities) Rules, 1977

These rules lay down certain obligatory conditions for all commodities that are packed form,

with respect to declaration on quantities contained. These rules are operated by the

Directorate of Weights and Measures, under the Ministry of Food and Civil supplies

BUREAU OF INDIAN STANDARDS (BIS)

During the pre-independence period, standardization activity was sporadic and confined

mainly to a few government organization. However immediately after independence,

economic development through coordinated utilization of resources was called for and the

government recognized the role for standardization in gearing industry to competitive

efficiency and quality production. The Indian Standard Institution was therefore, set up in

1947 as a registered society under a government of India resolution.

The Indian Standard Institution gave the nation the standard it needed for nationalization,

orderly industrial and commercial growth, quality production and competitive efficiency.

However, in 1986 the government recognized the need for strengthening this National

Standards Body due to fast changing socio-economic scenario and according it a statutory

29 | P a g e

status. Thus come the Bureau of Indian Standard Act 1986 and on 1 April 1987, newly

formed BIS took over staff assets.

The activities of BIS are twofold, the formulation of Indian standards in the processed food

sector and the implementation of standards through promotion and through voluntary and

third party certification systems. BIS has on record, standards for most of processed foods. In

general, these standards cover raw materials permitted and their quality parameters, hygienic

conditions under which products are manufactured and packaging and labelling requirements.

Manufacturer complying with standards laid down by the BIS can obtain and “ISI” mark that

can be exhibited on product packages. BIS has identified certain items like food

colours/additives, vanaspati, containers for packing milk powder and condensed milk for

compulsory certification.

Objectives of BIS

1) Harmonious development of standardization, marking and quality certification.

2) To provide new thrust to standardization and quality control.

3) To evolve a national strategy for according recognition to standards and integrating them

with growth and development of production and exports.

30 | P a g e

CONCLUSION

I am sure that our Bakery food product will be going to succeed as it is having a huge market.

The product range also which we are having is unique and it nearly covers all the necessary

qualities which it will make a unique product. There are large number of people in Allahabad

& it’s nearby city which can be served as our customers. Our bakery will be first of its kind

as there is no branded Bakery up till now in Uttar Pradesh which sells exclusively Cake

Pastry, bread this gives our cakery food product a first movers advantage. In India there are

large numbers of vegetarian people who account for about 40% of the Indian population. This

gives an idea about our target customers. People in India spend lavishly on their eating habit,

only we have to do is to provide best quality Bakery food.

There are many factors that influence the availability of the product. Supply of raw materials

should be within time. Baker and worker should be quick and best so that we can provide our

customers the quality Bakery food with a faster service. Marketing is especially important for

a business in retail industry because there is no other person on whom the retailer can rely in

this industry for penetration in the market or diversification.

Marketing is a very crucial activity in every business organization. Every product produced

within an industry has to be marketed otherwise it will remain as unsold stock, which will be

of no value.

31 | P a g e