PROJECT REPORT

Of

ELECTRIC IRON

PURPOSE OF THE DOCUMENT

This particular pre-feasibility is regarding Electric Iron.

The objective of the pre-feasibility report is primarily to facilitate potential entrepreneurs in project
identification for investment and in order to serve his objective; the document covers various aspects
of the project concept development, start-up, marketing, finance and management.

[We can modify the project capacity and project cost as per your requirement. We can also prepare
project report on any subject as per your requirement.]

Lucknow Office: Sidhivinayak Building ,

27/1/B, Gokhlley Marg, Lucknow-226001

Delhi Office : Multi Disciplinary Training

Centre, Gandhi Darshan Rajghat,
New Delhi 110002

Email : info@udyami.org.in
Contact : +91 7526000333, 444, 555
 PROJECT AT A GLANCE

1 Name of the Entreprenuer xxxxxxxxxx

2 Constitution (legal Status) : xxxxxxxxxx

3 Father / Spouse Name xxxxxxxxxxxx

4 Unit Address : xxxxxxxxxxxxxxxxxxxxxxx

District : xxxxxxx
Pin: xxxxxxx State: xxxxxxxxxx
Mobile xxxxxxx

5 Product and By Product : ELECTRIC IRON

6 Name of the project / business activity proposed : ELECTRIC IRON MANUFACTURING UNIT

7 Cost of Project : Rs.29.44 Lakhs

8 Means of Finance
Term Loan Rs.21 Lakhs
Own Capital Rs.2.94 Lakhs
Working Capital Rs.5.5 Lakhs
9 Debt Service Coverage Ratio : 2.29

10 Pay Back Period : 5 Years

11 Project Implementation Period : 5-6 Months

12 Break Even Point : 41%

13 Employment : 11 Persons

14 Power Requirement : 30 KW

Aluminium Billet, PTFE Powder, Heating Element, Plastic

15 Major Raw materials Resin,Thermostat, Electric cord,Packing material
:

Estimated Annual Sales Turnover (Max Utilized

16 Capacity) : 147.41 Lakhs

17 Detailed Cost of Project & Means of Finance

COST OF PROJECT (Rs. In Lakhs)

Particulars Amount
Land Own/Rented
Building /Shed 2000 Sq ft Own/Rented
Plant & Machinery 22.00
Furniture & Fixtures 1.33
Working Capital 6.11
Total 29.44

MEANS OF FINANCE
Particulars Amount
Own Contribution 2.94
Term Loan 21.00
Working Capital 5.50
Total 29.44
 ELECTRIC IRON

Introduction:A clothes iron (also flatiron or smoothing iron) has a handle

and a flat triangle shaped surface. Electricity makes the flat surface hot. A hot
iron is rubbed on clothes to make them flat and smooth. This is called ironing.
The handle does not get hot because that is where it is held. They are named
clothes irons because they used to be made out of the metal iron.It is an
electrical device that heats up to take wrinkles out of clothing. It is somewhat
triangle shaped with a smooth flat bottom. The pointed end is for pressing
corners and tight areas. It holds water to produce steam, which helps to
remove wrinkles. Before electric irons there were heavy cast iron irons that
were heated up by fire before use. Electric coil of Iron is most resistance wire
heating elements use nichrome 80/20 (80% nickel, 20% chromium) wire,
ribbon, or strip. Nichrome 80/20 is an ideal material, because it has relatively
high resistance and forms an adherent layer of chromium oxide when it is
heated for the first time.

Uses & Market Potential: Ironed clothes make one look smarter and
leave a better impression. The use of ironing extends the life of the fabric over
time as it prevents the clothes from fraying. Furthermore, it is much better
than the alternative to dry cleaning, which uses harmful chemical
perchloroethylene. Ironing helps in removing the smell of bleach from the
clothes.Student fraternity has emerged as one of the key buyers of the
product. Most schools and educational institutions based in Asian countries
including India, China, Bangladesh, and Pakistan have a strict uniform. It is
made mandatory among students to wear clean and well-ironed clothes to
invoke a habit of disciplined, hygienic, and smart lifestyle. People working in
corporate have also included ironed clothes as a part of office wear.The global
electric iron market size was valued at USD 1.0 billion in 2018 and anticipated
to expand at a CAGR of 8.3% over the forecast period. Increasing demand
among the millennial to look well-dressed is expected to promote the utility of
these products. Furthermore, a well-ironed set of clothes has become the
symbol of an elite society member.

Product:
Electric Iron

Raw Material:
1. Aluminium Billets
2. Heating Element
3. Plastic Resins Bakelite
4. PFTE Powder
5. Thermostat
6. Electric Cord
7. Packing Material
Manufacturing Process:

Fig.1 – Flow Chart

At first, the raw material is procured from the authorized local vendor and
stored in the inventory. In the first step, the electric iron sole plate is
manufactured by pouring the molten aluminium in the mould. The mould has
the desired shape as required for the sole plate.

The furnace is kept on and brought up to desired temperature of melting point

aluminium. Aluminium billets are brought from the inventory and fed into the
furnace through feeder. After this, the molten aluminum is poured into
moulds having the desired shape of sole plate of electric iron. The molten
aluminium solidifies which is separated from the mould.

In the next step, the sole plate coated with non-stick material to improve the
base efficiency.The base plate is first dipped in the acidic solution of sulphuric
acid for pickling process. The base plate is kept inside the acid for 15-20
minutes.
In the next step, they are pre heated to a temperature of 350 to 400℃. After
this, PFTE is coated over the base plate in PFTE coating plant. The PTFE
powder is sprayed over the surface of base plate at desired pressure using
electrostatic powder spray guns.A process called electrostatic spray
deposition (ESD) is typically used to achieve the application of the powder
coating to a metal substrate. This application method uses a spray gun, which
applies an electrostatic charge to the powder particles, which are then
attracted to the grounded part. The waste powder is separated through
cyclone arrangement could be reuse.

In the next step, the plastic casing for cover body and handle of the electric
iron is injection moulded using plastic injection moulding machine. The die of
desired shape is precisely assembled in the clamping unit of the machine as
per production requirement.

The barrel heaters are started and brought to the desired temperature to melt
down the thermoplastic pellets. Plastic pellets are then brought from the
warehouse and fed into the hopper of the machine. From the hopper, these
plastic pellets come into the feed section of the barrel. There is a screw inside
the barrel which rotates about the vertical axis and moves the pellets into
heating section of barrel where these plastic pellets melt to a semi-solid state
and are ready to be injected into the mold of the machine.

When resin melts the barrel compress the molten plastic into the profile dies
to form the desired contours. After this, it solidifies to form the desired
molded part. These plastic covers are collected and send to the assembly shop.

The heating element, thermostat are electrically connected using electric

cables over the base plate. The electric cord is connected for power supply to
the heating element. Plastic covers and handles are assembled at precise
locations.

In the next step, quality testing of the assembly unit is performed for
satisfactory performance. After this, the Electric irons are packed and
dispatched as per the required quantity.
Area:
The inddustrial seetup requirres space for Inventtory, work kshop or manufactu
m uring
pace for power supply utilitiees and auxxiliary likee Generator setup. Also
area, sp A
some of the area a of building is requiired for office sttaff faciliities,
documeentation, office
o furn
niture, etc. Thus, thee approxim
mate total area requuired
for com
mplete ind dustrial settup is 15000 - 2000SSqft. Civil work costt will be Rs.
R 9
Lac (Appprox.)

Machiines:
1. Furnnace –Th he furnace uses electrical
e induction
n heating to melt the
minium ussing princciple of induction melting is that a high voltage
alum
electtrical sourrce from a primary coil inducces a low voltage,
v high curren
nt in
the metal, orr secondaary coil. Innduction heating is i simply a method d of
tran
nsferring heat
h energgy.

2. PFT
TE Coating T plant consist of heating furnace, spray
g Plant – The s gunss for
adheerence of Teflon ovver the heaating surfface. The plant
p is seemi-autom
matic
designed as peer the pro
oduction caapacity for the plant.
 i) Coating Booth –The coating booth represents the area for powder
coating with cyclone arrangement and pressure valves to collect the waste
powder for reuse.

ii) Spray Gun –It is used to spray the PFTE powder over the surface of
aluminium with the help of compressor pressure.

iii) Heating Oven – The purpose of heating oven to pretreat the

components for heating purpose.

3. Plastic Injection Moulding Machine – The main working principle of

plastic molding machine is to use the plastic thermal physical properties.
First, we auto loader the plastic material into the barrel, which is surround
by heating elements melting the plastic. In the barrel which is assembled
with servo motor screw. The plastic melt will flow up the screw and under
the heating condition get tight and move forward to the screw head. At the
same time, due to the plastic reacting force, the screw will step back. So at
the screw head, it formed a plastic melt saving space to finish its
plasticizing process.
Equipments:
Profile Dies– A die is a specialized tool used in manufacturing industries to
cut or shape material mostly using a press.

Conveyor – The rolling conveyors are used to carry the material in coating
plant during powder coating process.

Studs, Fasteners, screws –These are used to assemble the laminations core
and other auxiliaries to the transformer tank.
PROJECTED CASH FLOW STATEMENT

PARTICULARS I II III IV V

SOURCES OF FUND

Own Contribution 2.94 -

Net Profit 0.68 3.95 9.21 14.75 20.63
Depreciation & Exp. W/off 3.43 2.92 2.49 2.12 1.81
Increase In Cash Credit 5.50
Increase In Term Loan 21.00 - - - -
Increase in Creditors 0.93 0.24 0.26 0.29 0.31
TOTAL : 34.49 7.11 11.96 17.16 22.75

APPLICATION OF FUND

Increase in Fixed Assets 23.33 - - - -

Increase in Stock 3.85 0.84 0.97 1.06 1.16
Increase in Debtors 3.26 0.97 0.96 1.04 1.13
Repayment of Term Loan 2.33 4.67 4.67 4.67 4.67
Taxation - - 0.21 1.58 3.51
Drawings 0.50 1.50 4.00 8.00 12.00
TOTAL : 33.28 7.98 10.81 16.35 22.46

Opening Cash & Bank Balance - 1.21 0.34 1.49 2.30

Add : Surplus 1.21 - 0.87 1.15 0.81 0.29

Closing Cash & Bank Balance 1.21 0.34 1.49 2.30 2.60
PROJECTED BALANCE SHEET

PARTICULARS I II III IV V

SOURCES OF FUND
Capital Account
Opening Balance - 3.12 5.57 10.57 15.74
Add: Additions 2.94 - - - -
Add: Net Profit 0.68 3.95 9.00 13.17 17.13
Less: Drawings 0.50 1.50 4.00 8.00 12.00
Closing Balance 3.12 5.57 10.57 15.74 20.86
CC Limit 5.50 5.50 5.50 5.50 5.50
Term Loan 18.66 14.00 9.33 4.67 -
Sundry Creditors 0.93 1.18 1.44 1.73 2.04

TOTAL : 28.22 26.24 26.84 27.63 28.40

APPLICATION OF FUND

Fixed Assets ( Gross) 23.33 23.33 23.33 23.33 23.33

Gross Dep. 3.43 6.36 8.85 10.97 12.78
Net Fixed Assets 19.90 16.97 14.48 12.36 10.55

Current Assets

Sundry Debtors 3.26 4.23 5.19 6.24 7.37

Stock in Hand 3.85 4.70 5.67 6.73 7.89
Cash and Bank 1.21 0.34 1.49 2.30 2.60

TOTAL : 28.22 26.24 26.84 27.63 28.40

- - - - -
PROJECTED PROFITABILITY STATEMENT

PARTICULARS I II III IV V

A) SALES
Gross Sale 65.25 84.67 103.87 124.76 147.41

Total (A) 65.25 84.67 103.87 124.76 147.41

B) COST OF SALES

Raw Mateiral Consumed 39.98 50.36 61.70 74.04 87.45

Electricity Expenses 3.15 3.78 4.41 5.04 5.67
Repair & Maintenance 0.33 0.42 0.52 0.62 0.74
Labour & Wages 8.78 9.66 10.62 11.68 12.85

Depreciation 3.43 2.92 2.49 2.12 1.81

Cost of Production 55.66 67.15 79.74 93.51 108.52

Add: Opening Stock /WIP - 1.86 2.18 2.58 3.03

Less: Closing Stock /WIP 1.86 2.18 2.58 3.03 3.51

Cost of Sales (B) 53.81 66.82 79.33 93.06 108.03

C) GROSS PROFIT (A-B) 11.44 17.84 24.54 31.69 39.38

17.54% 21.07% 23.63% 25.40% 26.71%
D) Bank Interest (Term Loan ) 2.28 1.86 1.35 0.83 0.32

ii) Interest On Working Capital 0.60 0.60 0.60 0.60 0.60

E) Salary to Staff 4.62 5.08 5.59 6.15 6.76
F) Selling & Adm Expenses Exp. 3.26 6.35 7.79 9.36 11.06

TOTAL (D+E) 10.76 13.90 15.33 16.95 18.75

H) NET PROFIT 0.68 3.95 9.21 14.75 20.63

1.0% 4.7% 8.9% 11.8% 14.0%
I) Taxation - - 0.21 1.58 3.51

J) PROFIT (After Tax) 0.68 3.95 9.00 13.17 17.13

COMPUTATION OF ELECTRIC IRON MANUFACTURING UNIT

Items to be Manufactured ELECTRIC IRON

Manufacturing Capacity per Day 100.00 pcs

No. of Working Hour 8

No of Working Days per month 25

No. of Working Day per annum 300

Total Production per Annum 30,000 pcs

ELECTRIC
IRON
Year Capacity MANUFACTU
RING UNIT
Utilisation

I 50% 15,000
II 60% 18,000
III 70% 21,000
IV 80% 24,000
V 90% 27,000

COMPUTATION OF RAW MATERIAL

Quantity of Total CostPer

Item Name Unit Unit Rate of
Raw Material Annum (100%)
Aluminium Billet 12,000.00 kg 185.00 2,220,000.00
PTFE Powder 4,500.00 kg 750.00 3,375,000.00
Heating Element 30,000.00 pcs 20.00 600,000.00
Plastic Resin 6,000.00 kg 30.00 180,000.00
Thermostat 30,000.00 pcs 25.00
750,000.00
Electric Cord 30,000.00 pcs 25.00 750,000.00
Packing Material 120,000.00
Total 30,000.00 7,995,000.00

Total Raw material in Rs lacs at 100% Capacity 79.95

Average Cost per PCS (In Rs) 266.50
Raw Material Consumed Capacity Rate Amount (Rs.)
Utilisation

I 50% 266.50 39.98

II 60% 279.80 50.36
III 70% 293.80 61.70
IV 80% 308.50 74.04
V 90% 323.90 87.45
COMPUTATION OF CLOSING STOCK & WORKING CAPITAL

PARTICULARS I II III IV V

Finished Goods
(10 Days requirement) 1.86 2.18 2.58 3.03 3.51
Raw Material
(20 Days requirement) 2.00 2.52 3.08 3.70 4.37

Closing Stock 3.85 4.70 5.67 6.73 7.89

COMPUTATION OF WORKING CAPITAL REQUIREMENT

Particulars Amount Margin(10%) Net

Amount
Stock in Hand 3.85
Less:
Sundry Creditors 0.93
Paid Stock 2.92 0.29 2.63

Sundry Debtors 3.26 0.33 2.94

Working Capital Requirement 5.57

Margin 0.62

MPBF 5.57
Working Capital Demand 5.50
BREAK UP OF LABOUR

Particulars Wages No of Total

Per Month Employees Salary

Plant Operator 15,000.00 1 15,000.00

Unskilled Worker 8,500.00 4 34,000.00
Helper 5,000.00 2 10,000.00
Security Guard 7,500.00 1 7,500.00

66,500.00
Add: 10% Fringe Benefit 6,650.00
Total Labour Cost Per Month 73,150.00
Total Labour Cost for the year ( In Rs. Lakhs) 8 8.78

BREAK UP OF SALARY

Particulars Salary No of Total

Per Month Employees Salary

Accountant cum store keeper 10,000.00 1 10,000.00

Administrative Staffs 12,500.00 2 25,000.00
Total Salary Per Month 35,000.00

Add: 10% Fringe Benefit 3,500.00

Total Salary for the month 38,500.00

Total Salary for the year ( In Rs. Lakhs) 3 4.62

COMPUTATION OF DEPRECIATION
Year

Plant &
Description Land Building/shed Machinery Furniture TOTAL

Rate of Depreciation 15.00% 10.00%

Opening Balance Own/Rented - - -
Addition - 22.00 1.33 23.33
- 22.00 1.33 23.33

TOTAL - 22.00 1.33 23.33

Less : Depreciation - - 3.30 0.13 3.43
WDV at end of Ist year - - 18.70 1.20 19.90
Additions During The Year - - - - -
- - 18.70 1.20 19.90

Less : Depreciation - - 2.81 0.12 2.92

WDV at end of IInd Year - - 15.90 1.08 16.97
Additions During The Year - - - - -
- - 15.90 1.08 16.97
Less : Depreciation - - 2.38 0.11 2.49
WDV at end of IIIrd year - - 13.51 0.97 14.48
Additions During The Year - - - - -
- - 13.51 0.97 14.48
Less : Depreciation - - 2.03 0.10 2.12
WDV at end of IV year - - 11.48 0.87 12.36
Additions During The Year - - - - -

- - 11.48 0.87 12.36

Less : Depreciation - - 1.72 0.09 1.81
WDV at end of Vth year - - 9.76 0.79 10.55
 REPAYMENT SCHEDULE OF TERM LOAN 11.0%

Year Particulars Amount Addition Total Interest Repayment Cl Balance

I Opening Balance
Ist Quarter - 21.00 21.00 0.58 - 21.00
Iind Quarter 21.00 - 21.00 0.58 - 21.00
IIIrd Quarter 21.00 - 21.00 0.58 1.17 19.83
Ivth Quarter 19.83 - 19.83 0.55 1.17 18.66
2.28 2.33
II Opening Balance
Ist Quarter 18.66 - 18.66 0.51 1.17 17.50
Iind Quarter 17.50 - 17.50 0.48 1.17 16.33
IIIrd Quarter 16.33 - 16.33 0.45 1.17 15.16
Ivth Quarter 15.16 15.16 0.42 1.17 14.00
1.86 4.67
III Opening Balance

Ist Quarter 14.00 - 14.00 0.38 1.17 12.83

Iind Quarter 12.83 - 12.83 0.35 1.17 11.67
IIIrd Quarter 11.67 - 11.67 0.32 1.17 10.50
Ivth Quarter 10.50 10.50 0.29 1.17 9.33
1.35 4.67
IV Opening Balance
Ist Quarter 9.33 - 9.33 0.26 1.17 8.17
Iind Quarter 8.17 - 8.17 0.22 1.17 7.00
IIIrd Quarter 7.00 - 7.00 0.19 1.17 5.83
Ivth Quarter 5.83 5.83 0.16 1.17 4.67
0.83 4.67

V Opening Balance
Ist Quarter 4.67 - 4.67 0.13 1.17 3.50
Iind Quarter 3.50 - 3.50 0.10 1.17 2.33
IIIrd Quarter 2.33 - 2.33 0.06 1.17 1.17
Ivth Quarter 1.17 1.17 0.03 1.17 0.00

0.32 4.67

Door to Door Period 60 Months

Moratorium Period 6 Months
Repayment Period 54 Months
CALCULATION OF D.S.C.R

PARTICULARS I II III IV V

CASH ACCRUALS 4.11 6.87 11.49 15.29 18.94

Interest on Term Loan 2.28 1.86 1.35 0.83 0.32

Total 6.39 8.73 12.84 16.13 19.26

REPAYMENT
Repayment of Term Loan 2.33 4.67 4.67 4.67 4.67

Interest on Term Loan 2.28 1.86 1.35 0.83 0.32

Total 4.61 6.53 6.01 5.50 4.99

DEBT SERVICE COVERAGE RATIO 1.39 1.34 2.13 2.93 3.86

AVERAGE D.S.C.R. 2.29

COMPUTATION OF SALE

Particulars I II III IV V

Op Stock - 500.00 600.00 700.00 800.00

Production 15,000.00 18,000.00 21,000.00 24,000.00 27,000.00

15,000.00 18,500.00 21,600.00 24,700.00 27,800.00

Less : Closing Stock(10 Days) 500.00 600.00 700.00 800.00 900.00

Net Sale 14,500.00 17,900.00 20,900.00 23,900.00 26,900.00

Avg Sale Price per pcs 450.00 473.00 497.00 522.00 548.00

Sale (in Lacs) 65.25 84.67 103.87 124.76 147.41

COMPUTATION OF ELECTRICITY
(A) POWER CONNECTION

Total Working Hour per day Hours 8

Electric Load Required KW 30
Load Factor
Electricity Charges per unit 7.50
Total Working Days 300
Electricity Charges 5.40

Add : Minimim Charges (@ 10%)

(B) DG set
No. of Working Days 300 days
Hour per
No of Working Hours 0.5
day
Total no. of Hour 150
Diesel Consumption per Hour 8
Total Consumption of Diesel 1,200
Cost of Diesel 65.00 Rs. /Ltr
Total cost of Diesel 0.78
Add : Lube Cost @15% 0.12
Total 0.90

Total cost of Power & Fuel at 100% 6.30

Year Capacity Amount

(in Lacs)

I 50% 3.15
II 60% 3.78
III 70% 4.41
IV 80% 5.04
V 90% 5.67
 DISCLAIMER

The views expressed in this Project Report are advisory in nature. SAMADHAN
assume no financial liability to anyone using the content for any purpose. All the
materials and content contained in Project report is for educational purpose and
reflect the views of the industry which are drawn from various research material
sources from internet, experts, suppliers and various other sources. The actual
cost of the project or industry will have to be taken on case to case basis
considering specific requirement of the project, capacity and type of plant and
other specific factors/cost directly related to the implementation of project. It is
intended for general guidance only and must not be considered a substitute for a
competent legal advice provided by a licensed industry professional. SAMADHAN
hereby disclaims any and all liability to any party for any direct, indirect, implied,
punitive, special, incidental or other consequential damages arising directly or
indirectly from any use of the Project Report Content, which is provided as is, and
without warranties.