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Botique Industry
DEDICATION
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Zarmeen's Collection
Executive Summary
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Zarmeen's Collection
EMBROIDERY:
Embroidery is one of the most sought out handicrafts of Pakistan the world over.
Multan, Bahawalpur and surrounding areas are full of gifted men and women
who produce one of the most adorable cross stitch. "Tilla" work, Pearl work and
"Salma Sitary" work of NWFP are very famous throughout the country. Swat is
well-known due to thread embroidery, whereas, in D.G.Khan mirror work is
done on clothes. Works of these types are called "Kadhai." Chitrali "Patti," that is
woven on hand looms and Kadhai done on Chitrali Chugha is very famous
What is embroidery?
Zardozi Embroidery:
As far as the world of design is concerned, embroidery is the backbone of Pakistan. Some of
our embroideries that can do wonder for Zardozi embroidery.
Zardozi work is an ancient form of embroidery basically done with gold or silver zari
threads. It is also known as metal embroidery. Although now-a-days it is also done with
colored metal threads. The word Zardozi is derived by combining two words Zar and Dozi
which in Persian language means gold and embroidery respectively. Therefore it is clear
that this art of embroidery was originated in Persia which was bought to India by Moghuls.
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Zarmeen's Collection
Initially it was done with real metal threads of gold and silver. It was done on clothes for
the rich and royal, wall hangings, bedsheets, etc. In between the application of pearls and
precious stones looks stunning on it. Basically it is done on silk, crepe, brocade and velvet
fabrics. Zardozi embroidery saw its decline during the reign of Aurangzeb. It was revived
after the independence.
Mirror Embroidery:
This work also originated in Persia during 13th century. Mirror work is never done alone, it
is generally in combination with other types of stitches or embroideries. This embroidery is
done with both large and small mirrors. It is embroidered using colorful threads like red,
green, blue, yellow, black, maroon, etc.
Kantha Embroidery
Kantha is the traditional form of embroidery of West Bengal. It is running style of stitch. The
embroidery is done on many layers of cloth. It is done on quilts, bedsheets, blankets, saris,
salwar suits, stoles, napkins, etc.
It is also known as Dorukha. This word means making worn out garments into beautiful
garments. Therefore it is also known as recycling art. In earlier times the worn out silk or
muslin clothes where used to be put in piles and stitched together. It is believed that its date
of origin lies during the era of Lord Buddha. They used to drape themselves with rags of
clothes that were stitched together.
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Chikankari Embroidery
Chikankari is derived from the word Chakeen that means elegant patterns on the fabric
which is a Persian word. Earlier it was done with white thread on muslin clothes. However
now it is been done on various types of fabrics like cotton, linen nylon, georgette, chiffon
and synthetic fabrics. Apart from wearable garments it is also done on various other things
like curtains, bed sheets, table cloths, pillow covers and cushion covers.
Unlike earlier times it is not only done on white colored cloths but also fabrics of various
colors. But the thread used for the embroidery is generally white. Various motifs are
embroidered through it like floral motifs which include flowers like rose, lotus, jasmine,
creepers, etc.
Sindhi Embroidary
sindhi embroidery is very famous all over the Pakistan including sindhi topi, ajrak. Sindhi
embroidery made on dresses.
It is made with the help of many types of threads and in in different colours on different
fabrics.
Phool patti Work
Phool patti work is popular in allover the pakistan & it need no special machines. It is done
with the help of needles not with machines. It is done with different colours threads and on
different fabrics.
TYPES OF EMBROIDERY
As far as the world of design is concerned, embroidery is the backbone of Pakistan. Some of
our embroideries that can do wonders for an outfit are:
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Mirror Work Mirror work which has its roots in Rajasthan and Kutch.
Lari Fine quality gold thread embroidery found in Bareilly , Benaras ( Varanasi
), Lucknow and Agra. These days silver zari is equally popular.
Phool Patti Work Applique work from Aligarh where usually organdi or other fabric cutouts
in floral and leaf motifs are affixed on to a plain fabric sometimes in
tandem with silver tilla embroidery.
Chikan Work Originating from Lucknow this involves a technique of finding separated
warp and weft threads for a textural effect.
Jaali Network.
Zardosi Leaf-scroll worked in gold and silver thread on silk, satin, velvet and
other rich fabrics. Zardosi is also combined with Dabka work and is
originally from Lucknow.
Product Mix
Designers dresses for men and women,
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Zarmeen's Collection
Suppliers
Stylo Shoes, Service shoes & Borjan shoes will provide us with matching
ladies and gents shoes. We will Order for matching bags to Sanat Zaar
Embroidery School. Jewelry will be purchased from main market of
Bahawalpur.
Installed Capacity
The Boutique business capacity is greatly dependent on the market size and
the number of potential clientele one can attract. Furthermore, the women
fashion wear garments will be designed through a contracted designer and
then stitched through in-house stitching unit. On average Installed capacity
of our Product is 60%..700 dresses will be manufactured in one month to
sale in Boutique. While Embroidery work on Order will also be taken from
in and outside the city.
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Cost of Project
Description Rs.
Fixed Initial cost 9990320
Initial Working Capital 13773350
Total 23763670
Means of Finance
Description Amount
Debt:Eqity Ratio 60:40
Amount of Debt 14.258202
million
Amount of Equity 9.505468
million
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IRR:
Internal Rate of Return 78%
Payback Period:
Payback Period (Years) 0.2072
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Introduction of Business:
Technical Analysis
In our boutique 10 embroiding machines, 20 single needle locking macines,
10 over lock stitching machine are present for the purpose of embroidery
dresses with the handmade embroidery dresses. In this simple machines are
used having not very expensive.
Inputs required are:-
Fabric
Electricity
Single needle lock stitch Machines
Embroidery machine
Scissors
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Zarmeen's Collection
Cutting board
Embroideries accessories
Design:
Pattern Making/Cutting
Stitching:
Finishing:
Presentation/Market:
Embroidery
Designing Pattern Making
Finishing
Stitching Cutting
Market/
Clientele Presentation
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Zarmeen's Collection
Personnel Analysis
In our boutique following is description of personnel
Chief executive
Designers
Sales girls
Product supervisor/ cutting master
Iron man
Office boy
Above all these personnel these include all technical & non-technical
personnel but at the same time there is no special need of technical
knowledge except designer who need some technical knowledge in computer
for innovating new designs day by day.
SWOT ANALYSIS
Strengths
Our Boutique would be the first big boutique in Bahawalpur city The labor
to manufacture embroidery dresses is easily available we can reach easily to
low cost labor. Moreover the location for our project is very attractive. We
can avail maximum advantage from this market.
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Weaknesses
Our weakness is that we are not manufacturing other accessories like bags,
shoes etc at initial stage. And we have to rely on other contractors for these
accessories. But with the passage of time we will hopefully enter in
Matching Bags and Shoes Business as well.
Opportunities
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Zarmeen's Collection
facilities to other boutiques, which do not own a stitching unit or are lacking
this facility.
Threats
Tax
Improper documentation of the sales receipt record may lead to problems
with Tax department.
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Zarmeen's Collection
MARKETING
List of Machinery
Machinery No
Single needle Lock stitch machine 20
Over Lock Stitch Machine 10
Embroidery Machine 10
Accessories (Scissors, Cutting Board,
Table, Stool, Carpet etc
Other Equipments
Air Conditioner 2
Stereo System 1
Computer and Printer 5
Telephone 2
Security System( Cameras and television) 3
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Raw Material:
The raw-material required for such sort of projects, would be as follows:
Fabric: The fabric, which is the basic raw material requirement for a
boutique and a major component of the cost, can be obtained from wholesale
markets or from markets specializing in designer cloth at Faisalabad,
Karachi, and Lahore.
Labels, tags and packaging: Labels and tags can be obtained on order, as
these serve as an identity for the boutique and are useful for promotion.
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Zarmeen's Collection
Personnel:
Requirement of Staff:
Production Staff
Designer 5
Snitchers/Tailors 4
Press/Iron Man 5
Finishing Man 2
Administrative Staff:
Sale Girls 8
Office boy 3
Total 34
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Zarmeen's Collection
Infrastructure Requirement
The project will have the following infrastructure components:
Infrastructure Requirement
Description Sq.ft
Main shop (30x30)
Bags Deptt (15x4)
Shoes Deptt (15x4)
Jewelry Deptt (15x4)
Try Room 2, (4x5)
Office 7x7
Store Basement
Building for Stitching Unit 10 Marla House
Try room
Try room
30z30
15x
15x 4
4 Sho
Jew es
lry
7x7
0ffice
30x30 Entrance
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Zarmeen's Collection
Financial analysis
Pre-operating
Expenses:
Staff's 1month Salaries. 442000 0 442000
Promotional Expenses 985320 0 985320
Total Pre Operating
Expenses 1427320
Working Capital:
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Zarmeen's Collection
Means of finance
Debt and Equity
Debt:
Long term Loan 14258202
Equity:
Paid-up-Capital 9505468
Project Returns
Description Rate
Internal Rate of Return 78%
Payback Period (Year) 0.2072
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Zarmeen's Collection
Zarmeens Collection
Projected Income Statement
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Projected
Zarmeen'sIncome Statement
Collection
RawMaterial,Embriodry
and Accessory 7244600 7317046 7390216 7464119 7538760
Purchase of Bages ,
Shoes and Jewellery 4365000 4474125 4585978 4700628 4818143
Machine Maintanece 25000 27500 30250 33275 36603
Payroll Production staff. 3420000 3762000 4138200 4552020 5007222
Direct Electricity 120000 132000 145200 159720 175692
Operating
Expenses:
Fixed Electricity 144000 158400 174240 191664 210830
Payroll Administration 1884000 2072400 2279640 2507604 2758364
Shop and Stitching
House rent 396000 415800 436590 458420 481340
Amortization pre
Operating Expense 142732 142732 142732 142732 142732
Telephone, Internet
Charges 84000 88200 92610 97241 102103
Promotional Expenses 1060650 583358 641693 705863 776449
Depriciation 1093250 1093250 1093250 1093250 1093250
Total 4804632 4554140 4860755 5196773 5565069
Non-Operating
Expenses:
Fnancial Charges 2566476 2053181 1539886 1026591 513295
Total 2566476 2053181 1539886 1026591 513295
1507236 1770833
Net Profit After tax 8069854 10439420 12656111 0 7
Operating Retained
Earnings 0 8069854 18509274 31165385 46237744
Retained earning - 22 -
beginning of year 8069854 18509274 31165385 46237744 63946082
Zarmeen's Collection
Zarmeens Collection
Projected Cash Flow Statement
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Year 2009 Zarmeen's
2010 Collection2012
2011 2013 2014
Description
Operating
Activities:
Financing
Activities:
Cash Provided/used
for financing
Activities 23763670 (2851640) (2851640) (2851640) (2851640) (2851640)
Investing
Activities:
Cash Used,
Provided by
Investing Activities (8882320) 0 0 0 0 0
Cash Balance
Brought Forword 0 6006068 14167368 24464774 37087551
Cash Balance 6006068 14167368 24464774 37087551 52243763
Running Finance 0 - 240 - 0 0 0
Cash Carried
Forword 6006068 14167368 24464774 37087551 52243763
Zarmeen's Collection
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Year 2009 2010 2011 2012 2013 2014
Description
Assets: Zarmeen's Collection
Current
Assets:
Cash 0 6006068 14167368 24464774 37087551 52243763
Security Deposit 1108000 1108000 1108000 1108000 1108000 1108000
Stock and
Inventry((Embriodry
dresses and
Bags, Shoes,
Jewellery) 11609600 3074348 3381783 3719961 4091957 4501153
Prepaid Rent 396000 415800 436590 458420 481340 505407
Account
Receivbles 1767750 2032913 2337849 2688527 3091806 3555577
Net Current
Assets 14881350 12637128 21431589 32439681 45860654 61913900
Fixed Assets:
Furniture and
Fixtue 500000 500000 500000 500000 500000 500000
Machinery And
Equipment 6955000 6955000 6955000 6955000 6955000 6955000
Total 7455000 7455000 7455000 7455000 7455000 7455000
Less: Accumulated
Depriciation
Furniture and
fixture 0 (50000) (100000) (150000) (200000) (250000)
Machinery and
Equipment 0 (1043250) (2086500) (3129750) (4173000) (5216250)
Total
Accumulated
Depriciation 0 (1093250) (2186500) (3279750) (4373000) (5466250)
Net Fixed Assets 7455000 6361750 5268500 4175250 3082000 1988750
Intangible
Assets:
Pre Operational
Expenses 1427320 1427320 1284588 1141856 999124 856392
Less Amortization 0 (142732) (142732) (142732) (142732) (142732)
Total 1427320 1284588 1141856 999124 856392 713660
Suspense
Account 0 8842687 8873431 8907248 8944448 8985368
Liabilities:
Long term Debt 14258202 11406562 8554921 5703281 2851640 0
Short term Debt
Account Payable 0 144270 145713 147170 148642 150128
Total 14258202 11550832 8700634 5850451 3000282 150128
Equity:
Paid Up Capital 9505468 9505468 - 26 -
9505468 9505468 9505468 9505468
Retained Earnings 0 8069854 18509274 31165385 46237744 63946082
Total 9505468 17575322 28014742 40670853 55743212 73451550
Zarmeen's Collection
Important
Ratios
Calculations
1)Machinery and Equipment
Machinery No Rs/Unit Rs.
Single needle Lock stitch machine 20 300000 6000000
Over Lock Stitch Machine 10 25000 250000
Embriodry Machine 10 25000 250000
Accessories (Scissors, Cutting Board,
Table, Stool, Carpet etc 75000
Total 6575000
Other Equipments
Air Conditioner 2 30000 60000
Stereo System 1 20000 20000
Computer and Printer 5 40000 200000
Telephone 2 5000 10000
Security System( Cameras and television) 3 30000 90000
Total 380000
Total Machinery and Equipment cost 6955000
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4)Depriciation Cost
5)Amortization Cost DEPRECIATION COST HAS BEEN CALCULATED ON STRAIGHT
LINE PRINCIPLE APPLYING USUAL RATES AS UNDER;-
Amortization Pre-Operating Expenses 10.00% 1427320 142732
Machinery and Equipment 15.00% 6955000 1043250
Ferniture and Fixture
Tenure 10.00% 500000 10 50000
year
Total 1093250
6)Capital Expenditures
8)Project Return
Net
Year Operating Depriciation
cash
Profit flow
2009 (23763670) 0 (23763670)
2010 15375768 1093250 16469018
2011 18623690 1093250 19716940
2012 21628950 1093250 22722200
2013 24950971 1093250 26044221
2014 28621767 1093250 29715017
Assumptions
1) production Assumptions
Ladies Gents Total
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Dress Dress
Number of Stitching Machines 20
Production Capacity (No. of dresses per month) 800 600 1400
Production Capacity (No. of dresses per year) 9600 7200 16800
Capacity Utilization for the first year
(No. of dresses per month) 300 400 700
Capacity Utilization for the first year
(No. of dresses per Year) 3600 4800 8400
100.00
Self Production (% of total production) %
Installed Capacity 50.00%
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2) Cost
Assumption
s
Embroided Dresses
Average unit cost per dress (Rs.)
Fixed cost
Machine Maintenance Cost 5
Admin & Rent expenses & promotional expenses 300
Fixed electricity 30
Average Fixed Cosr Per Dress(Rs) 335
Ladies Dresses
Average
Variable Cost
Material & Fabrics 669
Accessories 160
Embroidery Cost 358
Direct Labor Cost 250
Direct Electricity Cost 23
Average Variable cost per Ladies dress (Rs.) 1461
Average Total Cost Per Ladies Dress 1796
Gents Dresses
Variable Cost
Material & Fabrics 500
Accessories 22
Embroidery Cost 97
Direct Labor Cost 250
Direct Electricity Cost 22
Average variable cost per gents Dress 891
Total cost per Gents Dress 1226
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Shoes(Annual purchase)
Purchase units Rs.
Price/Unit
Ladies Shoes 850 1500 1275000
Gents Shoes 1500 1000 1500000
Total Cost on Shoes 2500 2775000
Stock in Hand (1Year) 10% 1600 250 400000
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Zarmeen's Collection
Jewellery(Annual purchase)
Purchase Items Rs.
Price/Items
Casual Jewelry 400 1000 400000
Formal Jewelary 500 800 400000
Total Cost on Jewellery 1800 800000
Stock in Hand (1Year) 10% 650 180 117000
Laddies Dresses
No. of dresses sold per month(Year 1) 500
Average unit price per dress (Rs.) 3283
Average Monthly Sales through retail outlet (Rs.) 1641667
Gents Dresses
No. of dresses sold per month(Year 1) 300
Average unit price per dress (Rs.) 1933
Average Monthly Sales through retail outlet (Rs.) 580000
Net Sale per month (1 Year) 2221667
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Zarmeen's Collection
Shoes(Annual Sale)
sale units Rs.
Price/Unit
Ladies Shoes 700 1350 945000
Gents Shoes 1000 900 900000
Net Sale of
Shoes 2250 1845000
Jewellery(Annual Sale)
Sale Items Rs.
Price/Items
Casual Jewellery 200 900 180000
Formal Jewellery 400 720 288000
Net Sale of Jewellelry 1620 468000
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4)
Operating
total
Assumption
s
6) Expense Assumptions
Initial Promotional Expenses (Year 1) 3.00%
(%age of expected sales)
Promotion Expenses after Year 1 1.50%
(% of expected sales)
Machine Maintenance per annum Rs. 25000
Direct Electricity per month (Year 1) 10000
Fixed Electricity per month (Year 1) 12000
Telephone and Internet charges per month (Year 1) 7000
Raw Material Price Growth rate 1.00%
Payroll growth rate 10.00%
Machine Maintenance growth rate 10.00%
Direct electricity growth rate 10.00%
Fixed electricity growth rate 10.00%
Rent growth rate 5.00%
Telephone and Internet charges growth rate 5.00%
Straight
Depreciation Method Line
Account Recivable(%age of sales) 2.00%
Account Payable (%age of Raw Material and Accessories 3.00%
7) Financial Assumption
Project Life 15 year
Debt: Equity Ratio 0
Interest Rate on Long Term
18.00%
Debt
Interest Rate on Short Term
18.00%
Debt
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5) Cash
flow
total
Assumption
s
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