ICE CREAM PLANT, BATCH TYPE

1. INTRODUCTION:

Ice Cream is a popular food product. It was considered as a luxury food for
summer season only. However, with the development of Dairy and Milk
processing industry it has also found use as a Dessert. The Bureau of Indian
Standards have formulated IS2802:1964 for performed Ice Cream and
IS5839:1970 for hygienic conditions for manufacture, storage and sale of
Perfumed Ice Cream. Average Ice Cream and Premium Ice Cream differ in solid
content as below:

No. Ingredient Content as percent in

Average Ice Cream Premium Ice Cream
1. Milk Fat 10.5% 16.0%
2. Non Fat Milk solids 11.0% 9,0%
3. Sucrose 12.5% 16.0%
4. Corn syrup 5.5% -
5. Stabilizers 0.3% 0.1%
6. Emulsifer 0.1% -
Total solids 39.9% 41.1
%
One hundred grams of Ice Cream contain more than 200 calories and 4%
protein, besides Minerals and Vitamins.

2. PRODUCT & ITS APPLICATION:

The ice cream makes easy and quick to serve like popcorns, in pre formed
paper or thermocol disposable cups or plastic containers, to maximize its
sales at site like shopping malls, amusement parks, air ports and railway
stations etc. It also make it much cleaner than “ordinary” ice cream, especially
with young kids, as unlike regular ice creams, it can be eaten using ordinary
spoons easily, without creating a mess. Ice creams are popular and
commonly available in the form of cups, bars and candies.
 3. DESIRED QUALIFICATIONS FOR PROMOTER:

Do not require any specifc qualifcation.

4. INDUSTRY LOOKOUT AND TRENDS

Ice cream market in the following regions – Asia Pacifc, North America, Europe,
Latin America and Middle East & Africa. According to the report, Asia is currently
the biggest market of ice cream followed by North America, Europe, Latin
America and Middle East & Africa. For each of the regions, this report provides
both historical (2009-2016) and future (2017-2022) trends in the ice cream
market. Other important market engineering aspects such as the competitive
landscape, margin analysis, import and export, porters fve forces analysis, value
chain analysis, etc. have also been thoroughly evaluated in this report.

The report also provides a detailed technical insight on setting up and operating
an ice cream manufacturing plant. This includes the manufacturing process,
machinery requirements, land requirements, labour requirements, packaging
requirements, transportation requirements, power requirements, incomes,
expenditures, proft margins, NPV, IRR, etc. In order to provide a clearer picture,
the report has also presented this information in the form of a dynamic excel
model where users can analyze the entire information and also change various
inputs according to their requirements.

5. MARKET POTENTIAL AND MARKETING ISSUES, IF ANY:

Ice Cream is consumed as Dessert as well as anytime snacks. Its demand peak
in Summer months. Railways are the most important bulk consumer of Ice
Cream. Hotels, Restaurants, Resorts and flight kitchens are other bulk
consumers. Sales through vendors and shops attract other consumers the
most. Street vendors fnd good market for Ice Creams among school children.

Increase in population, fast changing life style increasing percentage of

youths in population in north eastern states will result a satisfactory growth in
current market. Ice cream finds round the year market and is consumed in all
class of people as readily available hygienic food for all ages. Ice cream is
consumed more in cities. However, particularly in marriages, meetings and
social gatherings, i t is being used even in villages and towns. The consumption
of ice cream is likely to increase in future. There is good scope for any new
entrepreneur to venture in this field.

6. RAW MATERIAL REQUIREMENTS:

The Unit shall need the following raw- materials per annum at the installed
capacity:

No. Raw/Packing Materials Quantity

1. Milk 54000 Liters
2. Cream 6,300 Kilograms
3. Butter 2,200 Kilograms
4. Sugar 10,900 Kilograms
5. Stabilizers & Emulsifers & flavor 3,225 Kilograms
6. Corn syrup 4,200 Kilograms
7. Printed Ice Cream cups 7,50,000 No’s
8. Ice cream sticks 7,50,000 No’s
9. Printed paper cover 7,50,000 No’s
Total

Packing materials shall be stored for 3 months. Milk shall be stored for one day
only. Other raw-materials shall be stored for a week.

7. MANUFACTURING PROCESS:

The process suggested here is the one tested and practiced all over India. Milk
shall be pasteurized in Steam- Jacketed SS Vessel. Milk, Cream, Butter and
 Sugar in exact quantities shall be mixed in a SS Homogenizer. The Mix shall
be pasteurized again. Emulsifers and Stabilizers shall be added to the mix
and blended. This mix is further homogenized so that the globule sizes are 4
microns or less. The mixture is cooled again and kept cool for at least 24
hours at 4C to 0C. Flavors and colors are added prior to cooling. The mixture
is cooled again below 0C for hardening in a Batch Freezer. Ice Cream is
packed in small cups and as cones with Wooden/Bamboo handles. For cups and
cubes the above process suffices. For cones the Ice Cream is placed inside
moulds with the handle for deep freezing. Such cones are packed in
Plastic/Paper packets. Ice Cream in Cups and Cones shall be vended in Cooled
Hand Carts by authorized vendors. Vendors are given 35% of sales
realization as Commission and they work for the Commission only. Basic
steps in the manufacturing of ice cream are generally as follows:

 Blending of the mix ingredients

 Pasteurization
 Homogenization
 Aging the mix
 Freezing
 Packaging
 Hardening

8. MANPOWER REQUIREMENT:

The enterprise requires 15 employees as detailed below:

Sr. No Designation of Salary Monthl

Employees Per y Number of employees required
Person Salary
Year- Year- Year- Year-
Year-5
1 2 3 4
1 Un-Skilled Workers 8,000 56,000 7 7 7 7 7
2 Accountant 8,000 8,000 1 1 1 1 1
3 Store Keeper 6,000 6,000 1 1 1 1 1
Production
4 9,000 9,000 1 1 1 1 1
Supervisor
5 Security Personnel 6,500 6,500 1 1 1 1 1
6 Manager 20,000 20,000 1 1 1 1 1
7 Skilled Labour 10,000 30,000 3 3 3 3 3
Total 135,500 15 15 15 15 15

9. IMPLEMENTATION SCHEDULE:

The project can be implemented in 13 months’ time as detailed below:

Sr. No. Activity Time

Required
(in months)
1 Acquisition of premises 3.00
2 Construction (if applicable) 5.00
3 Procurement & installation of Plant & Machinery 2.00
4 Arrangement of Finance 2.00
5 Recruitment of required manpower 1.00
Total time required (some activities shall run 13.00
concurrently)

10. COST OF PROJECT:

The project shall cost INR 31.26 lacs as detailed below:

Sr. No. Particulars INR in Lacs

1 Land 7.50
2 Building 3.20
3 Plant & Machinery 6.88
4 Furniture, Electrical Installations 1.00
Other Assets including Preliminary / Pre-operative
5 0.69
expenses
6 Margin for Working Capital 12.00
Total 31.26

11. MEANS OF FINANCE:

Bank term loans are assumed @ 60% of fxed assets. The proposed funding
pattern is as under:
Sr. No. Particulars INR in Lacs
1 Promoter's contribution 7.81
2 Bank Finance 23.44
 Total 31.26
12. WORKING CAPITAL CALCULATION:

The project requires working capital of INR 12 lacs as detailed below:

Sr. Particula Gross Margin Margin Bank

No. rs Amt % Amt Finance
Inventorie
1 6.00 0.25 1.50 4.50
s
Receivabl
2 3.00 0.25 0.75 2.25
es
3 Overheads 3.00 100% 3.00 0.00
4 Creditors - 0.00 0.00
Total 12.00 5.25 6.75

13. LIST OF MACHINERY REQUIRED:

A detail of important machinery is given below:

Value
UO Qtt Rate
Sr. No. Particulars (INR in
M y (INR)
lacs)
1 (a) 2 No’s of 300 Ltr. Capacity SS Milk Storage NOS 1 INR 6.44
Tanks (b) One 400 Ltrs capacity SS steam . 644,400.00
Jacketed Pan (c) One ss steam Jacketted
Pasteuriser of 320 Ltrs. Capacity with 6 HP
Motor for Agitator (d) One SS Two stage
Homogeniser of 350 Liter capacity with water
cooling system operating at 300 PSI with 4.5
H.P. Motor, pressure gauge etc. (e) One SS
Surface Cooler (4.4°C to 0°C) in two sections:
water cooled and gas cooled. (f) One SS
Agency vat/storage Tank of 300 Liters capacity
with copper coil of 50 ft. length (g) One 35
Liter capacity Batch freezer with 9.0 TR and
6HP Compressor (h) One Deep Freeze (i) One
 volumetric flling machine (j) One Baby Boiler
(Non-IBR)

Freight, Packing & forwarding, CST, local INR

2 0.43
handling, etc. costs of above machinery 43,200.00
sub-total Plant & Machinery 6.88
Furniture / Electrical installations
a) Office furniture LS 1 50000 0.50
b) Stores Almirah LS 1 0 0.00
c) Computer & Printer L. S. 1 50000 0.50
sub total 1.00
Other Assets
a) preliminary and preoperative 0.69
sub-total Other Assets 0.69
Total 8.56

All the machines and equipments are available from local manufacturers. The
entrepreneur needs to ensure proper selection of product mix and proper type of
machines and tooling to have modern and flexible designs. It may be worthwhile
to look at reconditioned imported machines, dies and tooling. Some of the
machinery and dies and tooling suppliers are listed here below:

1. Fry-Tech Food Equipments Private Limited

S. No. 4, Raviraj Industrial Estate,
Bhikhubhai Mukhi Ka Kuwa Bharwadvash,
Ramol, Ahmedabad - 380024,
 Gujarat, India

2. Hindustan Vibrotech Pvt. Ltd.

Office No. 2, Ground Floor,
Vrindavan Building, Vile Parle East,
Mumbai – 400057,
Maharashtra, India

3. Electrons cooling systems Pvt. Ltd.

S-27, SIDCO Industrial Estate
Kakkalur Industrial Estate
Tiruvallur – 602003,
Tamil Nadu, India

4. Springboard Enterprises India Ltd.

1st, 2nd & 3rd Floor,
Plot No. 7, 8 & 9,
Garg Shopping Mall,
Service Centre, Rohini Sector 2
New Delhi – 110085

5. Flour Tech Engineers Private Limited

Plot No. 182, Sector 24,
Faridabad - 121005,
Haryana, India

6. P Square Technologies
3, Swami Mahal,
Gurunanak Nagar,
Off. Shankarsheth Road Bhavani Peth,
Pune - 411002,
Maharashtra, India
 7. Ricon Engineers
10 To 13, Bhagwati Estate,
Near Amraiwadi Torrent Power,
Behind Uttam Dairy,
Rakhial, Ahmedabad - 380023,
Gujarat, India

8. Kamdhenu Agro Machinery

Plot No. 6, Near Power House,
Wathoda Road Wathoda,
Nagpur - 440035,
Maharashtra, India

14. PROFITABILITY CALCULATIONS:

Year- Year- Year-

Sr. No. Particulars UOM Year-1 Year-5
2 3 4
1 Capacity Utilization % 60% 70% 80% 90% 100%
101.2
2 Sales INR In Lacs 67.50 78.75 90.00 112.50
5
Raw Materials & Other
3 INR In Lacs 34.47 40.22 45.96 51.71 57.45
direct inputs
4 Gross Margin INR In Lacs 33.03 38.53 44.04 49.54 55.05
Overheads except
5 INR In Lacs 15.36 16.32 18.24 18.82 19.20
interest
6 Interest @ 10 % INR In Lacs 2.34 2.34 1.56 1.17 0.94
7 Depreciation @ 30 % INR In Lacs 4.81 3.44 2.41 1.72 1.55
8 Net Profit before tax INR In Lacs 10.51 16.43 21.83 27.83 33.36

The basis of proftability calculation:

The growth of selling capacity will be increased 10% per year. (This is assumed
by various analysis and study, it can be increased according to the selling
strategy.)
Energy Costs are considered at Rs 7 per Kwh and fuel cost is considered at Rs. 65
per litre. The depreciation of plant is taken at 10-12 % and Interest costs are
taken at 14 -15 % depending on type of industry.

15. BREAKEVEN ANALYSIS:

The project shall reach cash break-even at 36.59% of projected capacity as

detailed below:
Sr.
Particulars UOM Value
No.
112.5
1 Sales at full capacity ₹. In Lacs
0
2 Variable costs ₹. In Lacs 57.45
3 Fixed costs incl. interest ₹. In Lacs 20.14
BEP = FC/(SR-VC) x 100 % of 36.59
4
= capacity %

16. STATUTORY / GOVERNMENT APPROVALS

The Ministry of Food Processing Industries has been operating several plan
schemes for the development of processed food sector in the country during the
10th Plan. One of the schemes relates to the Technology Up-gradation/
Establishment/ Modernization of food processing industries.

The Indian food processing industry is regulated by several laws which govern the
aspects of sanitation, licensing and other necessary permits that are required to
start up and run a food business. The legislation that dealt with food safety in
India was the Prevention of Food Adulteration Act, 1954 (hereinafter referred to
as "PFA"). The PFA had been in place for over fve decades and there was a need
for change due to varied reasons which include the changing requirements of our
food industry. The act brought into force in place of the PFA is the Food Safety
and Standards Act, 2006 (hereinafter referred to as "FSSA") that overrides all
other food related laws.
FSSA initiates harmonization of India's food regulations as per international
standards. It establishes a new national regulatory body, the Food Safety and
Standards Authority of India (hereinafter referred to as "FSSAI"), to develop
science based standards for food and to regulate and monitor the manufacture,
processing, storage, distribution, sale and import of food so as to ensure the
availability of safe and wholesome food for human consumption. Entrepreneur
may contact State Pollution Control Board where ever it is applicable.
All food imports will therefore be subject to the provisions of the FSSA and rules and
regulations which as notified by the Government on 5th of August 2011 will be
applicable.

Key Regulations of FSSA

A. Packaging and Labelling

B. Signage and Customer Notices
C. Licensing Registration and Health and Sanitary Permits

17. BACKWARD AND FORWARD INTEGRATIONS

The objective of the scheme is to provide effective and seamless backward and
forward integration for processed food industry by plugging the gaps in supply
chain in terms of availability of raw material and linkages with the market. Under
the scheme, fnancial assistance is provided for setting up of primary processing
centres/ collection centres at farm gate and modern retail outlets at the front end
along with connectivity through insulated/ refrigerated transport.

The Scheme is applicable to perishable horticulture and non-horticulture produce

such as, fruits, vegetables, dairy products, meat, poultry, fsh, Ready to Cook
Food Products, Honey, Coconut, Spices, Mushroom, Retails Shops for Perishable
Food Products etc. The Scheme would enable linking of farmers to processors and
the market for ensuring remunerative prices for agri produce.
The scheme is implemented by agencies/ organizations such as Govt./ PSUs/ Joint
Ventures/ NGOs/ Cooperatives/ SHGs / FPOs / Private Sector / individuals etc.

Backward Linkage:
 Integrated Pack-house(s) (with mechanized sorting & grading line/ packing
line/ waxing line/ staging cold rooms/cold storage, etc.)
 Pre Cooling Unit(s)/ Chillers
 Reefer boats
 Machinery & equipment for minimal processing and/or value addition such
as cutting, dicing, slicing, pickling, drying, pulping, canning, waxing, etc.
 Machinery & equipment for packing/ packaging.

Forward Linkage:
 Retail chain of outlets including facilities such as frozen storage/ deep
freezers/ refrigerated display cabinets/cold room/ chillers/ packing/
packaging, etc.
 Distribution centre associated with the retail chain of outlets with facilities
like cold room/ cold storage/ ripening chamber.

18. TRAINING CENTERS AND COURSES

There are few specialised Institutes provide degree certifcation in Food

Technology, few most famous and authenticate Institutions are as follows:

1. Indian Institute of Food Science & Technology,

Plot No.1, Near Maa-Baap ki Dargah,Opp to Nath Seeds,
Paithan Road Aurangabad
Aurangabad - 431005
 Maharashtra, India

2. MIT College of Food Technology, Pune

Gate.No.140, Raj Baugh Educational Complex,
Pune Solapur Highway,
Loni Kalbhor, Pune – 412201
Maharashtra, India

3. CSIR - Central Food Technological Research Institute (CFTRI)

Cheluvamba Mansion, Opp. Railway Museum,
Devaraja Mohalla, CFTRI Campus, Kajjihundi, Mysuru
Karnataka – 570020

Udyamimitra portal ( link : www.udyamimitra.in ) can also be accessed for

handholding services viz. application flling / project report preparation, EDP,
fnancial Training, Skill Development, mentoring etc.
Entrepreneurship program helps to run business successfully is also available
from Institutes like Entrepreneurship Development Institute of India (EDII) and its
affiliates all over India.

Disclaimer:
Only few machine manufacturers are mentioned in the profle, although many
machine manufacturers are available in the market. The addresses given for
machinery manufacturers have been taken from reliable sources, to the best of
knowledge and contacts. However, no responsibility is admitted, in case any
inadvertent error or incorrectness is noticed therein. Further the same have been
given by way of information only and do not carry any recommendation.

Source:- Udyami Mitra/Sidbi