Entrepreneurship is the act of being an entrepreneur, which is a French word meaning "one who undertakes an endeavor". Entrepreneurs assemble resources including innovations, finance and business acumen in an effort to transform innovations into economic goods. This may result in new organizations or may be part of revitalizing mature organizations in response to a perceived opportunity. The most obvious form of entrepreneurship is that of starting new businesses; however, in recent years, the term has been extended to include social and political forms of entrepreneurial activity. When entrepreneurship is describing activities within a firm or large organization it is referred to as intra-preneurship and may include corporate venturing, when large entities spin-off organizations. According to Paul Reynolds, entrepreneurship scholar and creator of the Global Entrepreneurship Monitor, "by the time they reach their retirement years, half of all working men in the United States probably have a period of self-employment of one or more years; one in four may have engaged in self-employoment for six or more years. Participating in a new business
creation is a common activity among U.S. workers over their course of their careers.
The Economy of India is the eleventh largest in the world by nominal GDP and the fourth largest by purchasing power parity (PPP). The country's per capita GDP (PPP) is $3,290 (IMF, 127th) in 2010. Following strong economic reforms from the socialist inspired economy of a post-independence Indian nation, the country began to develop a fast-paced economic growth, as free market principles were initiated in 1990 for international competition and foreign investment. Economists predict that by 2020, India will be among the leading economies of the world. India was under social democratic policies from 1947 to 1991. The economy was characterised by extensive regulation, protectionism, public
ownership, pervasive corruption and slow growth. Since 1991, continuing economic liberalisation has moved the country toward a market-based economy. A revival of economic reforms and better economic policy in first
decade of the 21st century accelerated India's economic growth rate. In recent years, Indian cities have continued to liberalise business regulations. By 2008, India had established itself as the world's second-fastest growing major economy. However, as a result of the financial crisis of 20072010, coupled with a poor monsoon, India's gross domestic product (GDP) growth rate significantly slowed to 6.7% in 200809, but subsequently recovered to 7.2% in 200910, while the fiscal deficit rose from 5.9% to a high 6.5% during the same period. The unemployment rate for 20092010, according to the state Labour Bureau, was 9.4 percent nationwide, rising to 10.1 percent in rural areas, where two-thirds of the 1.2 billion population live. India's large service industry accounts for 57.2% of the country's GDP while the industrial and agricultural sector contribute 28% and 14.6% respectively. Agriculture is the predominant occupation in India, accounting for about 52% of employment. The service sector makes up a further 34%, and industrial sector around 14%. The labour force totals half a billion workers. Major agricultural products include rice, wheat, oilseed, cotton, jute, tea, sugarcane, potatoes, cattle, water buffalo, sheep, goats, poultry and fish. Major industries include telecommunications, textiles, chemicals,
food processing, steel, transportation equipment, cement, mining, petroleum, machinery, information technology-enabled services and pharmaceuticals. However, statistics from a 2009-10 government survey, which used a smaller sample size than earlier surveys, suggested that the share of agriculture in employment had dropped to 45.5%. Previously a closed economy, India's trade and business sector has grown fast. India currently accounts for 1.5% of world trade as of 2007 according to the WTO. According to the World Trade Statistics of the WTO in 2006, India's total merchandise trade (counting exports and imports) was valued at $294 billion in 2006 and India's services trade inclusive of export and import was $143 billion. Thus, India's global economic engagement in 2006 covering both merchandise and services trade was of the order of $437 billion, up by a record 72% from a level of $253 billion in 2004. India's total trade in goods and services has reached a share of 43% of GDP in 200506, up from 16% in 199091.
Kerala has witnessed tremendous development especially from the economic point of view. Although Kerala economy is primarily based on agriculture, the strong historical significance and natural attributes of the state have resulted in the presence of several industries in Kerala.
Located in the south-western tip of India, Kerala has the following to its credit:
The highest literacy rate in India. Tourism has grown to be a front line industry government backing and private management. An efficient public transport system. Information Technology is becoming a key area of economic excellence
The following are the features of the predominantly agrarian economy of Kerala: Kerala is a major producer of cash crops like coconuts, rubber, tea, coffee, pepper, cardamom, cashew, areca nut, nutmeg, ginger, cinnamon, and cloves. Coconuts bring the people their principal source of earning in agriculture. Nearly 70% of Indian output of coconuts is provided by Kerala. . Cardamom is one of the major exports of India and the bulk of Cardamom comes from Kerala.
Role of industry in Kerala economy Industries of Kerala economy are hugely based on agriculture and marine products. Some traditional industries are: Coir and coir products Marine products Handloom and handicrafts related to ivory, wood, bone carving, hand embroidery, cane works, coconut shell carving, and paddy straw picture making. Village industries manufacture Khadi, fiber, pottery, lime, paper, matches, gobar gas, cane, and bamboo.
The economy of Kerala, though small and agro-based, has a lot to look forward in future with the upcoming of IT and allied industries that are willing to exploit the yet-to-be tapped resources.
INTRODUCTION
Entrepreneurial activities are substantially different depending on the type of organization that is being started. Entrepreneurship ranges in scale from solo projects (even involving the entrepreneur only part-time) to major undertakings creating many job opportunities. Many "high value" entrepreneurial ventures seek venture capital or angel funding in order to
raise capital to build the business. Angel investors generally seek returns of 20-30% and more extensive involvement in the business.[3] Many kinds of organizations now exist to support would-be entrepreneurs, including specialized government agencies, business incubators, science parks, and some NGOs. In more recent times, the term entrepreneurship has been extended to include elements not related necessarliy to business formation activity such as conceptualizations of entrepreneurship as a specific mindset (see also entrepreneurial mindset) resulting in entrepreneurial initiatives e.g. in the form of social entrepreneurship, political entrepreneurship, or knowledge entrepreneurship have emerged Total Indian Entrepreneurial Activity Average = 12.1%
India was second among all nations in Total Entrepreneurship Activity as per the Global Entrepreneurship Monitor Report of 2002. But after several years of data, India appears to have a TEA level rather close to the world average.
India is ninth in the Global Entrepreneurship Monitor (GEM) survey of entrepreneurial countries. It is highest among 28 countries in Necessity based entrepreneurship, while 5th from the lowest in opportunity based entrepreneurship. The liberalization, which was started in 1991, and the Information Technology boom of the mid-late 90s, have been significant factors, leading to a wave of entrepreneurship sweeping through the country. Indians have entrepreneurial capacity. However the society and
government are not very encouraging towards entrepreneurship. To a large extent, the Indian society is risk averse. People usually seek secure and long-term employment, such as government jobs. The physical infrastructure needs to be improved. Social Attitudes, lack of capital, inadequate physical infrastructure and lack of government support are major factors of hindrance. India is the fifth largest economy in the world (ranking above France, Italy, the United Kingdom, and Russia) and has the third largest GDP in the entire continent of Asia. It is also the second largest among emerging nations. The
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liberalization of the economy in the 1990s has paved the way for a huge number of people to become entrepreneurs.
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The contribution of small scale industries to the country's economy has declined to six percent over the course of last ten years. According to a survey report released by Central Statistics Department, the contribution of such industries to the GDP in 2066 declined to six percent from 9 percent recorded in 2057. The Department carries out this sort of survey in every 10 years. The slower growth of industrial sector in comparison with service one is attributed to such decline. The survey was carried out by incorporating the industries involved in income oriented activities. As per the survey, some 32,326 small scale industries were operating throughout the country during the fiscal year 2065/66. Out of these, samples were collected from 3,737 industries. Amongst them, 62 percent were based in rural areas while the remaining 38 percent were situated in urban areas. The survey also stated that the investment made by the small scale industries was to the tune of Rs 3.03 billion while the value of the products and services generated by them stood at Rs 1.49 billion.
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The survey also pointed out that electricity is a major challenge for operation of such industries. However, Dr Jagadish Chandra Pokharel, chairman, National Planning Commission (NPC), believed that since these enterprises do not demand high magnitude electricity, there should be an arrangement of alternative energy to run them. According to Pokharel, since the role of small scale industries is pivotal in eradicating poverty as envisioned by Millenium Development Goals (MDGs), the NPC will rethink the plans and programmes vis-a-vis such industries. nepalnews.com Opportunity The opportunities in the small-scale sector are enormous due to the following factors:
Less Capital Intensive Extensive Promotion & Support by Government Reservation for Exclusive Manufacture by small scale sector Project Profiles Funding - Finance & Subsidies
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Machinery Procurement Raw Material Procurement Manpower Training Technical & Managerial skills Tooling & Testing support Reservation for Exclusive Purchase by Government Export Promotion Growth in demand in the domestic market size due to overall
economic growth
Increasing Export Potential for Indian products Growth in Requirements for ancillary units due to the increase
in number of greenfield units coming up in the large scale sector. Small industry sector has performed exceedingly well and enabled our country to achieve a wide measure of industrial growth and diversification.
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INDUSTRY PROFILE
Comfortable and versatile, Churidar-style clothing, developed in India, can be worn by both men and women. Simple shapes combine to create these garments, making them a great first project for novice seamstresses. Outfits consist of long pants and medium or long tunics. The ideal fabrics for these garments are cotton, silk and rayon, easy fabrics for beginners to sew. Because of their minimalistic design, they make the perfect framework for embroidery or other types of embellishments. Difficulty: Moderately Easy Instructions Things You'll Need:
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Fabric Pins Scissors Marking pencil or tailor's chalk Thread Sewing machine Seam binding (optional)
Measure yourself to get your chest, waist and hip measurements. Be sure to wear only the undergarments you plan to wear under your new Churidar clothing, or if you plan to layer these garments over other clothing, measure yourself over these other garments. A trusted friend can help make the measuring process easier. Buy a pattern for Indian clothing, and find your size by comparing your measurements to the measurements on the back of the pattern envelope. The envelope will explain how much fabric is needed for your size. Purchase the required amount of fabric for your outfit, as well as any notions required, such as buttons or trim.
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Cut out the pattern and fabric as directed by the pattern instructions. Transfer all pattern markings, such as dots and notches, to the fabric using your marking pencil or tailor's chalk. These markings are added to the pattern to assist you in constructing your garment, and will be referenced in the sewing instructions. Fit the garment to your body by pinning it together and carefully putting it on. Churidar clothing is designed to fit fairly loosely around the body. Re-pin the seams until you are satisfied with the fit, trying it on repeatedly until you are satisfied. Sew the pieces together as instructed by the pattern's sewing directions. If your fabric starts raveling at the edges as you sew, you may want to enclose the seams with seam binding or by using a zigzag stitch on the edges. Hem the bottom of the Churidar pants to the desired length, traditionally at the ankle. Hem the tunic and sleeves to the desired length.
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PROJECT AT A GLANCE
Name of the unit Address Constitution Location About the project Materials Name and address of proprietor
: : : : :
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Rs: 1,00,00,000
Means of finance
COMPANY PROFILE
M/S Angel Industries is a small scale business unit. It is a sole trading concern concern. They produce various types of Churidar Materials. The unit is located at Kottayam The location is favourable to the industry. The name of the proprietor is Mr. Subash. He has several years experience in the field. The unit has gained a reputation in a short span of operations.The promoters skill and ability is the backbone of this industry. VARIOUS DEPARTMENTS ASSOCIATED WITH THE COMPANY
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PRODUCTION DEPARTMENT The unit has a wide manufacturing process.So it has a production department to coordinate the activities 1. Maintain the quality 2.Reduce the cost of Production 3.Increase the efficiency in production.
Marketing Department Now a days paper has high demand.To earn maximum profit the unit has a good marketing department.Its functions are:
1. Give Value to customer needs 2.Selecting the advertising Campaign. 3. Plan Customer oriented marketing Strategies
Packing Department 1.Make the product packing Attractive. 2. Pack the products with care
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Maintain good customer satisfaction. Provide better product with cheaper rate Maintain a stable growth in sales
PRICING METHOD
Before fixing the price the firm consider the raw material cost as it is changing frequently.
DISTRIBUTION CHANNEL
Retailers Agents Direct Sales
COST OF THE PROJECT Details of Plant Table No: 4.1 Sl. Category No 1 Manufacturing Unit 2 3 Quality Testing Machine Were ho using & Packing Unit Sq.ft 1600 500 900 TOTAL Amount 16,00,000 5,00,000 9,00,000 30,00,000
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Details of Machine Table No: 4.2 Sl. No Category 1 2 3 4 5 Clothing Machine Cross Stitching Machine Inter Lock Machine Embroidery Machine Swing Machine Tax TOTAL 32 No 2 3 4 3 20 Amount 2,50,000 2,00,000 2,00,000 2,00,000 1,50,000 1,30,000 11,30,000
Details of Land Table No: 4.3 Sl.No 1 Acre/Cent 59 Cent TOTAL Amount 50,00,000 50,00,000
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Sl.No 1 2 3
No 20 7 27
Details of Tools and other Accessories Table No: 4.5 Sl. No 1 2 Category Tools Accessories Amount 50,000 50,000 TOTAL 1,00,000
Details of Vehicle Table No: 4.6 Sl. No 1 Category Tempo Van TOTAL Amount 6,00,000 6,00,000
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Sl. No 1 2 3 4 5 6
Item Plant Machinery Land Furniture & Fittings Tools & Accessories Vehicle TOTAL
Means of Finance Own Capital Borrowed Term loan TOTAL 60,00,000 40,00,000 1,00,00,000
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a) SALES The expected average annual turnover for the proposed project in the initial year is 42,,00,000 and a nominal increase is made in the subsequent years. The details of turnover are as follows:Table No: 4.8
Sl. No 1 2 3 4 5 6
Item Printed Churidar Cotton Churidar Chiridar Salvarkameez Fancy Churidar Designer Embroidary Churidar Traditional Churidar TOTAL
B) EXPENDITURE a) Raw Materials The expected average annual raw materials for the proposed project is the initial year is Rs. 12,00,000 and a nominal increase is made in the subsequent years. The details of raw materials are given below:-
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Sl. No 1 2 3 4 5 6 7
Item Basic Materilal Fine Fabric Shimmer Threads Beads Mirror Sewers Packing Materials TOTAL
b) Salary This project may provide employment opportunity for 23 members. The expected average annual salary provided for the persons are Rs. 10,00,000 and a nominal increase is made in the subsequent years. Details of salary is as follows :-
Table No: 4.10 Sl. No 1 2 3 4 Category Cutting Staff Craftsman Quality Controller Stock Keeper No 2 2 1 1 Amount 1,00,000 1,00,000 1,20,000 30,000
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5 6 7
2 15 1 TOTAL 23
C) Electricity Charges The expected average annual electricity charges for the proposed project is Rs. 1,00,000 and a nominal increase is made in the subsequent years. D) Repairs & Maintenance The expected average repairs and maintenance of the proposed project is Rs. 50,000 and a nominal increase was made in the subsequent years. E) Travelling Sales promotion Expense The expected average travelling & sales promotion expense of the proposed project is Rs. 1,50,000 and a nominal increase was made is the subsequent years. F) Office Expense The expected average annual office expense of the proposed project is Rs. 2,00,000 and a nominal increase is made in the subsequent years. G) Interest on Loan Interest on loan is provided at 10% per annum. H) Depreciation
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Depreciation is provided at 10% per annum on straight line method. Its details are given below :-
Table No: 4.11 Sl. No 1 2 3 4 5 6 Category Amount Rate of Depreciation 10% 10% 10% 10% 10% Depreciation
Plant Machinery Land Furniture & Fitting Tools Accessories Vehicle and TOTAL
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1 2 3 4 5 6 7 8
Raw Materials Salary Electricity charges Repairs & Maintenance Travelling & Sales Promotion Expense Office Expense Interest on Loan Depreciation
12,00,000 10,00,000 1,00,000 50,000 1,50,000 2,00,000 4,00,000 5,00,000 TOTAL 36,00,000
WORKING CAPITAL REQUIREMENT OF THE PROPOSED PROJECT The working capital requirement of the proposed project is for 2 months. Its details are as follows:Table No: 4.13 Sl. No 1 Raw Material 2 3 4 5 6 7 8 Salary Electricity Charges Repairs & Maintenance Travelling & Sales Promotion Expense Office Expense Interest on Loan Depreciation Category Amount 2,00,000 1,66,667 16,667 8,333 25,000 33,333 66,667 83,333 TOTAL 6,00,000
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ANNEXURE I
ANNEXURE II
ANNEXURE III
ANNEXURE IV
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A) INCOME B) Sales: TOTAL C) Variable Expense a) Opening stock b) Purchase c) Closing stock Material Consumed (a+b)-c D) TOTAL E) Gross Profit (B-D) F) Operating Expense Salary Electricity Charges Repairs & Maintenance
42.00 42.00 12.00 (2.00) 10.00 10.00 32.00 10.00 1.00 .50
47.00 47.00 2.00 12.00 (3.00) 11.00 11.00 36.00 12.00 1.20 .60 1.75 2.25 3.20 5.00 26.00 10.00
53.00 53.00 3.00 14.00 (3.00) 14.00 14.00 39.00 14.00 1.40 .70 2.00 2.50 2.40 5.00 28.00 11.00
59.00` 59.00 65.00 65.00 3.00 15.00 (2.00) 16.00 16.00 43.00 16.00 1.60 .80 2.25 2.75 1.60 5.00 30.00 13.00 2.00 17.00 (1.00) 18.00 18.00 47.00 18.00 1.80 .90 2.50 3.00 .80 5.00 32.00 15.00
Travelling& Sales Promotion 1.50 expense Office Expense 2.00 Interest on Loan Depreciation G) TOTAL H) Net Profit (E-G) 4.00 5.00 24.00 8.00
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Year
operation Add Depreciation Decrease in Current Asset B) Total 100.00 C) Outflow Fixed Asset Plant Machinery Land Furniture & Fittings Tools & Accessories Vehicle Repayment of loan Increase in current asset Income Tax Drawings D) Total E) Surplus F) Cumulative Surplus 100.00 0 0 30.00 11.30 50.00 1.70 1.00 6.00
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RS. In lakhs Year A) Source of Fund Inflow fromDepreciation operation Add Less Income Tax B) TOTAL C) Servicing of Debt Repayment of Loan D) TOTAL E) DSCR (B/D) 8.00 8.00 1.45 8.00 8.00 1.62 8.00 8.00 1.71 8.00 8.00 1.89 8.00 8.00 2.06 8.00 5.00 (1.41) 11.59 10.00 5.00 (2.01) 12.99 11.00 5.00 (2.31) 13.69 13.00 5.00 (2.91) 15.09 15.00 5.00 (3.51) 16.49 1 2 3 4 5
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A) Source of Fund Owned Fund Borrowed Term Loan B) TOTAL C) Application of Fund Fixed Asset Plant Machinery Land Furniture & Fittings Vehicle Current Asset Stock Cash in hand D) Total
76.37 0 76.37
24.00 21.00 9.04 1.36 .80 4.80 3.00 .09 7.91 1.19 .70 4.20 3.00 .18 50.00 50.00
100
.04 97.04
93.09 88.18
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Rs. In Lakhs Particulars A) Sales B) Variable Cost Raw Material (A-B) C) Contribution D) PV Ratio (C/A)x100 E) Fixed Cost F) Break Even Value (E/D) 1 42 10.00 32.00 76.19 24.00 .3150 2 47 3 53 4 59 16.00 43.00 72.88 30.00 .4116 5 65 18.00 47.00 72.30 32.00 .4425
11.00 14.00 36.00 39.00 76.59 73.58 26.00 28.00 .3395 .3805
BREAK EVEN POINT It is a point on sale at which total revenue is equal to total cost. BREAK EVEN POINT:Fixed Cost/PV Ratio PV Ratio: (Contribution/Sales) x 100 Contribution: Sales Variable Cost
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0 1 2 3 YEAR 4 5
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Rs. In Lakhs Particulars A) Borrowed Fund B) Owned Fund C) Debt Equity Ratio (A/B) 1 32.00 65.04 .4920 2 24.00 69.09 .3473 3 16.00 72.18 .2217 4 8.00 74.27 .1077 5 0 76.37 0
DEBT EQUITY RATIO It is a ratio between proprietors fund and outsiders fund Debt Quality Ratio:- Borrowed Fund/Owned Fund
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0 1 2 3 YEAR 4 5
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RS: In Lakhs Particulars A) Fixed Assets B) Owned Fund C) FANWR (A/B) 1 95.00 65.04 1.4606 2 90.00 69.09 3 85.00 72.18 4 80.00 74.27 1.0772 5 75.00 76.37 .9821
1.3026 1.1776
FIXED ASSET TO NET WORTH RATIO It is the ratio between fixed assets to proprietors fund. Fixed asset to net worth ratio = fixed assets/owned fund
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15
10
0 1 2 3 YEAR 4 5
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FIXED ASSET TURNOVER RATIO Table No: 4.17 Rs: In Lakhs Particulars A) Sales B) Fixed Asset C) FTAR (A/B) 1 42 95 .4421 2 47 90 .5222 3 53 85 .6235 4 59 80 .7375 5 65 75 .8667
FIXED ASSET TURNOVER RATIO It is the ratio between sales and fixed assets. Fixed Asset Turnover Ratio = Sales/Fixed Assets
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1 0.8186 0.8 0.6702 FIXED ASSETS TURNOVER 0.6 RATIO 0.4 0.7422
0.9635
0.2
0 1 2 3 YEAR 4 5
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Rs. In Lakhs Particulars A) Net Profit B) Sales C) Net Profit Ratio (A/B)x100 1 8.00 42.00 19.05 2 3 4 13.00 59.00 22.03 5 15.00 65.00 23.08
NET PROFIT RATIO It is the ratio between net profit and sales Net Profit Ratio = (Net profit/Sales x 100)
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0.9635
0.2
0 1 2 3 YEAR 4 5
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PROPRITORY RATIO Table No: 4.19 Rs. In Lakhs Particulars A) Shareholders fund B) Total Assets C) Proprietary Ratio (A/B) 1 65.04 97.04 .6702 2 69.09 93.09 .7422 3 72.18 88.18 .8186 4 79.27 82.27 .9635 5 76.37 76.37 1.00
PROPRITORY RATIO It is the ratio between shareholders fund and total assets. Proprietary Ratio = Shareholders Fund/Total Asset
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PROPRITORY RATIO
SCALE : 1 UNIT= 0.2 1.2 1
0.9635
0.2
0 1 2 3 YEAR 4 5
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CONCLUSION
By verifying the balance sheet it is identified that the financial position of the firm is sound. By verifying debt service coverage ratio the firm is able to repay their interest instalments. The firm has the capacity to repay all their liabilities in time Increase in profit is a measurement of operating efficiency of the firm
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SUGGESTION
The taste and preference of the customers are changing day to day in this industry. The firm should be aware of changing trends in the industry.
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BIBLIOGRAPHY
Reserch Methodology Patel ,Kithabi Publication. Cost Accounting L R Pooti Chand Publication Web Site www.indian economy.com www.keralaeconomy.co.in www.manufacturingprocess.com www.smallscaleindustries.org
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