ENTREPRENEURSHIP

REPORT ON
ESTABLISHING A SMALL SCALE INDUSTRY
FOR MANUFACTURING OF
STAINLESS STEEL SCREWS

SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENT FOR

THE
AWARD OF THE DEGREE OF
BACHELOR OF TECHNOLOGY
(MECHANICAL ENGINEERING)

SUBMITTED TO:
SUBMITTED BY:

ACKNOWLEDGEMENT
It gives me great pleasure to present this project report on
SMALL SCALE INDUSTRIES.
I would like to express my sincere thanks, with a deep sense of
gratitude to my guide
in Mechanical Department for his kind interest, valuable
guidance and constant motivation which is primarily responsible
for successful completion of this project report.
I am also thankful to all the faculty members of mechanical
Engineering Department for their valuable suggestions and timely
help. The well-experienced and skilled staff of mechanical
department imparted me good knowledge about the small-scale
industries. I have enhanced my technical knowledge to a great
extent by preparing this project report under the guidance of my
guide and other faculty members of mechanical department. At
last, I would like to thank the management of my college &
university for introducing this project report in our study
curriculum.

CONTENTS
Description
Introduction to Small Scale Industry
How to Start a Small Scale Industry
Registration of small scale industry
Incentive facilities
Type of constitutions
Financial Requirements
Small Industrial Development Organization
Concept of marketing
Important schemes of Financial SFC
Concept Of Marketing
Steps In Marketing Management
Product Classification
Organization Structure Of SSI
Organization Under SSI
Product Specification
Process Flow Chart
Project Economy
M/C and Raw Materials Suppliers

PROJECT REPORT
Under Small Scale Industries Schemes

1. Firm Name:-LAKSHMI PRECISION SCREWS Pvt. Ltd.

2. Address:- Bhagat Singh Marg, Rohtak, Haryana
3. Nature of Business: - Production Of Stainless Steel Wood Screws
4. Target:- 1849 Packets Per Day

INTRODUCTION
Under Section 7 of the Micro, Small and Medium Enterprises Development Act, 2006, the micro,
small and medium enterprises are defined as under: Micro enterprises, where the investment in plant and machinery does not exceed twenty
five lakh rupees;
A small enterprise, where the investment in plant and machinery is more than twenty-five

lakh rupees but does not exceed five crore rupees; or

A medium enterprise, where the investment in plant and machinery is more than five
crore rupees but does not exceed ten crore rupees;
Small industry sector has performed exceedingly well and enabled our country to

achieve a wide measure of industrial growth and diversification. By its less capital intensive and
high labor absorption nature, SSI sector has made significant contributions to employment
generation and also to rural industrialization.
Under the changing economic scenario, SSI has both the challenges and
opportunities before them. The business can compete on cost, quality and products at domestic
and international level only if ideal investment in technology production process, R&D and
marketing are made. Infrastructure bottlenecks are not completely solved. The promotional
activities for SSI in India need to concentrate on improved credit flows, human resource
development, appropriate technology and funds for modernization.
So, this is the appropriate time to set up projects in the small-scale sector. It may be
said that the stance is optimistic, indeed promising, given some protection. This expectation is
based on an

essential feature of the Indian industry and the demand structures. The variety in the demand
structures will ensure long-term co-existence of many layers of demand for consumer products
/technologies / processes. There will be flourishing and well grounded markets for the same
product/process, differentiated by quality, value added and sophistication. This characteristic of
the Indian economy will allow complementary existence for various diverse types of units.
However, this is not to say that there are no shortcomings within the industry, or in
public policy relating to it. Small industries are faced with numerous problems major and minor,
which make them either uncompetitive, or sick. An attempt is made to address some solutions
that can improve their productivity.
The Government has been taking various measures from time to time in order to enhance the
productivity, efficiency and competitiveness of the SSI sector.
The strategy adopt by the government is:1. Public entrepreneurship should remain confined only to those industries & sector where
private enterprise, individual or corporate, is generally not attracted. Existing public
entrepreneurship be improved through better management & by putting relative greatly emphasis
on research &development. There is need to streamline the R&D wing of public sector
enterprise.
2. All possible efforts are made very seriously (not casually) for the development of an industrial
culture. It should be realize that the central core of entrepreneurship is the motive force since by
its nature; entrepreneurship implies positive action and individual with the right kind of
combination of ability can pursue their goal with unremitted courage and enthusiasms.
3. There is need to development management education and industrial training.
4. The development of backward region / area constitutes a new challenge. Program for their
development be drawn up and should be effective implemented.
5. Adequate measure is a must for mobilizing & casting the entrepreneurs talent in the country.
In this context, it should be realized that entrepreneurs are not the grief of a particular classes.
6. Economic administration by the state should be improved and made more effective so that
economic policy may be fully achieving their objective in the overall interest of economy.

7. Financial institute should provide adequate and timely credit and timely create and technical
assistance, especially to the small and medium sized enterprise. They may also impart knowledge
about the need of economy and they should file their massive data in term of growth of new
entrants or entrepreneurs in the field of industry.
For achieving these objectives, the specific schemes / programmes undertaken by the
organisations of this Ministry seek to facilitate / provide one or more of the following for the
MSMEs:

Adequate credit from financial institutions/banks;

Funds for technology upgradation and modernization;
Adequate infrastructural facilities;
Modern testing facilities and quality certification laboratories;
Modern management practices and skill upgradation through advanced training facilities;
Marketing assistance;

The Ministry of Small Scale Industries is implementing following Schemes/Programmes for

promotion and development of SSIs in the country:

Surveys, Studies and Policy Research

International Cooperation
Assistance for strengthening of Training Infrastructure of Existing
New Entrepreneurship Development Institutions

THE ROLE OF GOVERNMENT TOWARDS SSI

After independence, Indian planners and policy-makers felt that protection was
essential to the development of a strong and indigenous economy. The Indian state played an
integral role in the
industrial and economic development of the country resulting in a dominant public sector and
heavily
regulated private sector. Viewing this, the protection was also extended to SSI as it was an
important
tool in employment generation, value creation and poverty alleviation.
These SSI also support entrepreneurial talent and skills, stimulate personal savings,
and help in developing innovative and appropriate indigenous technology, providing dynamism
and contributing to competition (Rajendran 1989). Over 800 products were exclusively reserved
for SSI, where some of the products produced were purchased by government agencies. Apart
form this, supply of scarce materials, input price concessions like lower interest rates and
numerous fiscal measures such as excise duty exemptions and other tax concessions were also
given (Source-Business Today, September 10, 2006). Government has reserved certain products
for manufacture in the small scale sector in areas where there is techno-economic justification for
such an approach. Large/Medium units can; however, manufacture such reserved items provided
they undertake to export 50% or more of their production. As on March 2005, the total number
of items reserved for small-scale sector is 506.
In the second plan (1956-61), the SSI was given priority due to its consequence in
creation of
diversified employment opportunities and wide dispersal of industrial production. The policies
proposed then, were, and remain the main backbone of public policy relating to the SSI. What we

see however is that this policy has been largely unhelpful, if not detrimental to the development
of the sector. The policy regulations relating to the SSI are such that they ensure that units stay
just small.
Promotional measures aim to increase the efficiency and economic viability of
small units by
Providing infrastructure facilities and improving access to markets. On the other hand,
protective measures give small units preferential treatment. Continuous measures are those
benefits which a small unit may avail of as long as it falls under that category, while one-shot are
those which may be availed of only once, and tends to be discretionary in nature. Most policies
like preference in government purchases; lower interest rates etc. are continuous in nature.
Discretionary measures are those, which require an examination on a case-by-case basis and are
not blanket measures available to all units, which fall under the definition of small. Non
discretionary, by implication, are those measure which are based on some objective criteria and
are applicable to all units that meet the criteria.
The government has also provided measures such as greater infra-structural support,
more and
easier availability of credit, lower rates of duty, technology up-gradation, assistance to build
entrepreneurial talent, facilities for quality improvement, and export incentives (Parthasarathy,
1996).
The Ministry of Small Scale Industries (MoSSI) designs policies, programmes, projects and
schemes in consultation with its organizations. It also performs the function of policy advocacy
with other Ministries/Departments of the Central Government and the States and Union
Territories. Implementation of the policies and programmes/projects/schemes for providing
various support services to the MSEs is undertaken through its attached office, namely, the
Office of Development Commissioner (Small Scale Industries) also known as Small Industries
Development Organisation (SIDO) and the National Small Industries Corporation (NSIC) Ltd., a
public sector undertaking of the Ministry. There are three national level Entrepreneurship
Development Institutes supported by the Ministry viz. National Institute of Small Industry
Extension Training (NISIET), Hyderabad, National Institute of Entrepreneurship and Small
Business Development (NIESBUD), NOIDA and Indian Institute of Entrepreneurship (IIE),
Guwahati.

Advantages of small business

A small business can be started at a very low cost and on a part-time basis. Small
business is also well suited to internetmarketing because it can easily serve specialized niches,
something that would have been more difficult prior to the internet revolution which began in the
late 1990s. Adapting to change is crucial in business and particularly small business; not being
tied to any bureaucratic inertia, it is typically easier to respond to the marketplace quickly. Small
business proprietors tend to be intimate with their customers and clients which results in greater
accountability and maturity.
Independence is another advantage of owning a small business. One survey of small business
owners showed that 38% of those who left their jobs at other companies said their main reason
for leaving was that they wanted to be their own bosses. Freedom to operate independently is a
reward for small business owners. In addition, many people desire to make their own decisions,
take their own risks, and reap the rewards of their efforts. Small business owners have the
satisfaction of making their own decisions within the constraints imposed by economic and other
environmental factors. However, entrepreneurs have to work very long hours and understand that
ultimately their customers are their bosses.

HOW TO START A SMALL SCALE INDUSTRY

The steps involved in starting a small scale industry are: Product identification: conduct market survey and study the product as regard their
demand in the market.
Check whether it is a seasonal product or it has demanded throughout the year.
Study similar product available in the market that can be probable competitor. Analyze
them as regards their utility, quality and cost.

 Find whether can be exported.

Decide the product that you are going to manufacture, on the basis of:a) Market Survey
b) Financial implication involved
c) Technical knowhow available
d) Experience in the line, etc.
Preparation of preliminary project report to get rough idea on machinery, raw material
and financial requirement.
Select a proper site for locating the unit.
1.

Take a building for factory on hire or construct your own factory building.

2.

Get yourself conversant with the rules and other information available from small-scale
industries, Ministry of Industry, New Delhi.

3.

Prepare a scheme in detail to manufacture the selected product such a scheme should
include the requirement of and the approximate cost of:I. Land and building
II. Machinery, tools and other equipment
III. Direct labour
IV. Indirect labour
V. Direct material cost
VI. Indirect material cost

VII. Selling and distribution overheads

VIII. Working Capital for a unit time
IX. Depreciation
X. Total production cost per unit time
XI. Percentage of profit.
Make a detailed project report
apply for registration.
The scheme after it has been prepared is sent for approval to the Directorate of Industries
of the particular state.
A small scale unit has to get itself registered with the Directorate of industries in order to
avail various facilities provided by the government, such as:I. Financial assistance

II. Raw materials water and power

III. Import license
IV. Factory accommodation
V. Government order

If required apply for loan.

Apply for income tax and sales tax numbers.
Recruit personal.
Conduct trial run to see whether the desired quantity and quality of product is coming.

REGISTRATION OF SMALL SCALE INDUSTRIES

REQUIREMENT
Even is State Directorate of Industries does not demand for licensing under development of SSIs
but we should go for its registration for our profit. Some special things are there which are
necessary to be licensed. The incentive scheme provided by the government is also provided to
those firms which are registered so for this reason registration is beneficial.
The registration of SSI is of two types:1) Provisional registration.
2) Permanent registration.
The provisional registration is provided to the unit for starting two years. This is provided before
production. If still the firm could not run in actual production it can also be renewed by state
directorate of industries.

FINANCIAL AID FOR SSI

Credit is the prime input for sustained growth of SSI and its mobilization for meeting fixed and
working capital needs poses the foremost problems. Credit is provided for creation of fixed
assets like land, building, plant and machinery is called long term credit. These packet ages of
assistance are providing to SSI by a large number of organization operative at national &state
level. Development program are being carried out at two level
a) National level
b) State level
AGENCIES WHICH WORK AT NATIONAL LEVEL ARE:a) Small Scale Industrial Board (SSIB)
b) Small Scale Industries Development Organization (SIDO)
c) National Small Scale Industrial Corporation (NSIC).
AGENCIES WHICH WORK AT STATE LEVEL ARE:-

a) State Directorate of Industries (SDI)

b) District Industrial Center (DIC)
c) State Small Industrial Corporation (SSIC)
d) State Financial Corporations (SFCs)
e) Commercial Banks
f) Small Industries Development Bank of India (SIDBI).

Credit provided for running the industry for its day-to-day requirement for purchasing raw
material and other input like electricity and water etc. Apart from this, credit facilities up to
maximum of Rs.25lakhs are provided through Credit Guarantee Fund Trust in collaboration with
SIDBI and Govt. of India.
The SSI is provided working capital by commercial banks and in some cases by cooperative
banks and regional rural banks.
Term loans are provided by State Financial Corporations (SFCs), Small Industries
Development
Corporations (SIDCs), National Small Industries Corporation (NSIC) and National Bank for
Agriculture and Rural Development (NABARD). Financial assistance from NSIC and to some
extent from SIDCs is available in the form of supply of machinery on hire purchase
basis/deferred payment basis. Small sized SSI and tiny units also get some term loans from
commercial banks along with working capital in the form of composite loans.
The Small Industries Development Bank of India (SIDBI) provides refinance to these
institutions. Such refinance comprises assistance provided to State Financial Corporation Bills,
Finance
Scheme, Special Capital/Seed Capital Scheme, and new debt instruments and to National Small
Industries Corporation. Long-term loan are provided to the smalls scale industrial units by SFCs
mainly through Single Window Scheme and National Equity Fund as also direct assistance
provided to State Financial Corporations in the form of refinance. Some part of working capital
for pre-operative expenses is also provided by State Financial Corporations to Small Scale
Industrial Units under the Single Window Scheme.

SMALL INDUSTRY DEVELOPMENT ORGANISATION (SIDO)

The Small Industry Development Organization (SIDO) also known as the Office of the
Development Commissioner (SSI) is an apex body for assisting the Ministry in formulating,
coordinating, implementing and monitoring policies and programmes for the promotion and
development of small scale industries in the country and is headed by the Development
Commissisioner (SSI).
For details the organisation may be contacted at the following
address :
Additional Secretary and Development Commissioner (SSI),
7th Floor, NirmanBhavan,
New Delhi 110 011
Website : www.laghu-udyog.com or
www.smallindustryindia.com

NATIONAL SMALL INDUSTRIES CORPORATION (NSIC) LTD

NSIC continues to implement its various programmes and projects throughout the country to
assist SSI Units. The Corporation has been assisting the sector through the schemes and activities
such as Supply of both indigenous and imported machines on easy hire-purchase terms,
Composite term loan scheme, Credit rating for small scale industries, Procurement, supply and
distribution of indigenous and imported raw-materials, Marketing of small industries products,
Export of small industries products and developing export-worthiness of small scale units,
Enlisting competent units and facilitating their participation in government Stores Purchase
Programme, Training in several technical trades, Sensitizing SSI units on technological
upgradation through software Technology Parks and Technology Transfer Centres, For details the
organisation may be contacted at the following
address:
Chairman-cum-Managing Director,
National Small Industries Corporation Ltd.,
NSIC Bhawan,
Okhla Industrial Estate,

New Delhi 110 020

Website : www.nsicindia.com

NATIONAL INSTITUTE OF SMALL INDUSTRY EXTENSION TRAINING

(NISIET), HYDERABAD.
Assisting in the promotion, development, and modernization of small and medium enterprises
(SMEs) to progress towards success and prosperity.
For details the organisation may be contacted at the following
address :
Principal Director,
National Institute of Small Industry Extension Training,
Yousufguda,
Hyderabad 500 045
Website :www.nisiet.com

NATIONAL INSTITUTE FOR ENTREPRENUERSHIP AND SMALL

BUSINESS DEVELOPMENT (NIESBUD), NOIDA
The National Institute for Entrepreneurship & Small Business Development (NIESBUD) is a
registered society under the Ministry of Small Scale Industries. The major activities of the
institute include, development of model syllabi for training of various target groups, providing
effective training strategies, For details the organisation may be contacted at the following
Address :
Executive Director,
National Institute for Entrepreneurship and Small Business
Development,
A-23, Sector-62,
Industrial Area, Phase- II,
Noida - 201301,

U.P, India
Website :www.niesbud.com

STATE FINANCIAL CORPORATION

Almost every state has its own financial cooperation to provide machine and long term loans
small and medium sale industries. Amount of loan varies from Rs. 5000 to Rs. 6 Lakh and these
are repayable in equal installments spread over a period of 10-12 years.
Important schemes of financing SFC are
1) A loan scheme for financing of village and cottage industries. Under this scheme they are
financed to the extent of Rs. 25,000 and the interest rate is very low.
2) Assistance to tiny units these grant assistance up to Rs. 2.00 lakh.
3) Scheme for technical entrepreneur in order to encourage self employment these corporation
provide financial assistance up to Rs.2.00 lakh at very low interest rate to such technical
entrepreneurs who have acquired a diploma or degree in any discipline of engineering .
4) Loans to hotel industry
5) Scheme for SC/ST Grant financial assistance to SC/ST entrepreneurs at a nominal margin
rates are charged at the rate of 10%.
6) Scheme for physically handicapped these provide financial assistance up to Rs. 3.00 lakh at a
rate of 10%.

COMMERCIAL BANKS

SBI and its subsidiary banks and other nationalized banks provide liberal term loans and
working capital to small scale entrepreneurs and these loans are advanced for purchase of
machine and material and to the technical entrepreneurs to encourage self employment.
Specialized institute like, Central Institute of Tool Design, Hyderabad, Central Tool Room,
Ludhiana and Kolkata, Central Institute of Hand Tool Jalandhar, Institute for Design of Electrical
Measuring Instruments (IDEMI) Mumbai, Integrated Trading centre, Nilokhedi, National
institute of small Industry Exton, Hydrabad and National Institute for Entrepreneurship and
Small Business Development. They conduct special courses, programmers, Workshops, training
programmers for the benefits of small scale industries.
Credit Support
Credit is the prime input for sustained growth of small scale sector and its availability continued
to be a matter of concern. To provide credit support to the various SSI units various policies have
been formulates by the GOI. Various institutes like SFC,

SIDC,

providing financial supports to various SSI units.

CONCEPT OF MARKETING

NISC,

and

SIDBI

are

The marketing concept is the philosophy that firms should analyze the needs of their customers
and then make decisions to satisfy those needs, better than the competition. Today most firms
have adopted the marketing concept, but this has not always been the case.
In 1776 in The Wealth of Nations, Adam Smith wrote that the needs of producers should be
considered only with regard to meeting the needs of consumers. While this philosophy is
consistent with the marketing concept, it would not be adopted widely until nearly 200 years
later.
To better understand the marketing concept, it is worthwhile to put it in perspective by reviewing
other philosophies that once were predominant. While these alternative concepts prevailed
during different historical time frames, they are not restricted to those periods and are still
practiced by some firms today.

The Production Concept

The production concept prevailed from the time of the industrial revolution until the early 1920's.
The production concept was the idea that a firm should focus on those products that it could
produce most efficiently and that the creation of a supply of low-cost products would in and of
itself create the demand for the products. The key questions that a firm would ask before
producing a product were:

Can we produce the product?

Can we produce enough of it?

At the time, the production concept worked fairly well because the goods that were produced
were largely those of basic necessity and there was a relatively high level of unfulfilled demand.
Virtually everything that could be produced was sold easily by a sales team whose job it was
simply to execute transactions at a price determined by the cost of production. The production
concept prevailed into the late 1920's.

The Sales Concept

By the early 1930's however, mass production had become commonplace, competition had
increased, and there was little unfulfilled demand. Around this time, firms began to practice the
sales concept (or selling concept), under which companies not only would produce the products,
but also would try to convince customers to buy them through advertising and personal selling.
Before producing a product, the key questions were:

Can we sell the product?

Can we charge enough for it?

The sales concept paid little attention to whether the product actually was needed; the goal
simply was to beat the competition to the sale with little regard to customer satisfaction.
Marketing was a function that was performed after the product was developed and produced, and
many people came to associate marketing with hard selling. Even today, many people use the
word "marketing" when they really mean sales.

The Marketing Concept

After World War II, the variety of products increased and hard selling no longer could be relied
upon to generate sales. With increased discretionary income, customers could afford to be
selective and buy only those products that precisely met their changing needs, and these needs
were not immediately obvious. The key questions became:

What do customers want?

Can we develop it while they still want it?

How can we keep our customers satisfied?

In response to these discerning customers, firms began to adopt the marketing concept, which
involves:

Focusing on customer needs before developing the product

Aligning all functions of the company to focus on those needs

Realizing a profit by successfully satisfying customer needs over the long-term

When firms first began to adopt the marketing concept, they typically set up separate marketing
departments whose objective it was to satisfy customer needs. Often these departments were
sales departments with expanded responsibilities. While this expanded sales department structure
can be found in some companies today, many firms have structured themselves into marketing
organizations having a company-wide customer focus. Since the entire organization exists to
satisfy customer needs, nobody can neglect a customer issue by declaring it a "marketing
problem" - everybody must be concerned with customer satisfaction.
The marketing concept relies upon marketing research to define market segments, their size, and
their needs. To satisfy those needs, the marketing team makes decisions about the controllable
parameters of the marketing mix.
In business and engineering, new product development (NPD) is the term used to describe the
complete process of bringing a new product or service to market. There are two parallel paths
involved in the NPD process: one involves the idea generation, product design and detail
engineering; the other involves market research and marketing analysis. Companies typically see
new product development as the first stage in generating and commercializing new products
within the overall strategic process of product life cycle management used to maintain or grow
their market share.

STEPS IN MARKETING MANAGEMENT

1. Product planning
2. Sale Forecasting
3. Pricing Policy
4. Distribution Strategy
5. Role of Advertising (personal selling)
6. Quality
1. Product planning:-product planning may be defined as the act of marketing out and
supervising the search, screening, development and commercialization of new product,
modification of existing line.
Product planning involves three important considerations
a) The development and Induction of new ideas.
b) The modification of exiting lines as may be required in term of changing costumers need
and performance.
c) The discontinuance of elimination of marginal or unprofitable product.
Product can be classified as:1. Customer products
2. Industrial products
3. Defense products
1. Costumer products:-goods design for use ultimately by the costumer or household and in
such from they can be used without commercial processing.

2. Industrial products:-goods which are designed to be sold primarily for use in producing
goods destined to be sold primarily to the ultimate consumers.

2. Sale Forecast
Definition: - a sales forecast is an estimate for the amount or unit sale for a specified future
period under a purposed marketing plan or program.
As define by American marketing association it is an estimate of sales in dollars or physical
units for a specified future period under a purposed marketing plan or program and under an
assumed set of economic and other forces outside the unit for which forecast is made.
Marketing of proper sale forecast require an assessment of:1 The outside uncontrollable forces likely to influences the company sales.
2. The internal proposed changes in the marketing strategies and tactics of the company which
are likely to affect the sale.
Sales forecast can be for a specified product line or can be for a market as a whole or for any
portion of it. According to the time period, the sales forecast can be divided under three types1. Short Run Forecasts: - which generally extends from a few weeks to about six months or at
most one year in future. Companies mostly do this as day-to-day forecasts for their production
control needs and to plan for long term financial needs.
2. Medium Range Forecasts: - which extends from one year to about four years into future.
This type of forecasting is important for
a) Estimating profits, budgeting expenses etc.
b) Determining dividing policy
c) Deciding rate of maintenance expenditure
d) Determining schedule of operation.
It is use full for the following purposes:a) Estimating inventory requirement

b) Providing adequate shipping facilities

c) Assessing production worker requirements.
d) Estimating working capital needs
e) Setting production runs for each product
f) Fining sales quotes
3. Long Range Forecast: - Extending to least five years into futures and in case of really large
organization extending over a longer period up to ten years or even more.
It is useful in following ways:1. Anticipating the magnitude and timing of capital expenditures required for new facilities in the
future.
2. Determining probable trends and range of cash in flow from sales.
3. Estimating companies long range personnel needs.
4. Highlighting futures problems.

3. Pricing polices: - Pricing is a very critical decision. Pricing decision is not easy to make.
Hence sound pricing polices must be adopted to ensure that the originations secure satisfactory
profit. For pricing decision a marketing manager has to be familiar with economic concept useful
in pricing decision. He has to consider various pricing factor which infusing price a part from
cost such as costumer characteristics, the economical product characteristics, competitive
environment and government control whenever applicable. The pricing of the product materially
affected the demand for it as well as the origination competitive ability for expenditure if the
quality of the product is to be improved this may be possible only if the costumer are willing to
pay higher price for it. Beside, if the product is not properly priced there might be reluctance
from the channels of distribution.

4. Distribution Strategy: - distribution may be defined as an operation or a series of

operation , which physically bring goods manufactured or produced by only particular

manufactured into the hands of the final consumers to the users . Distribution strategies consist
of distribution or sub-dividing the total products of a manufacturer on a geographical basis to
various specific markets. There may be a state market, a National Market or even a worldwide
market for the production while defining a strategy we have to deal with two aspects. First, is
the organizational aspects, it is concerned with how and through what channels we should
distribute. For this general marketing policy is responsible for deciding the various channels for
distribution. Secondly, is the operational aspect of distribution or the physical distribution, it is
concerned with moving of goods from one place to other, including the warehousing storage
and transportation costs as well includes. These aspects are some times described as logistics
of distribution

5. Advertising: - To counter the market at National and International level the GOI set up
various institutes like:- 1) Export Credit Guarantee Corporation Ltd. (ECGC)
2) State Trading Corporation. (STC)
3) Trade development Authority.
4) National Small Industries Corporation. (NSIC)

Organizational Structure of SSI: - There are 28 SISIs set up in State Capital and other
industrial cities all over the country. The main activities of these institutions are as follows: -Assistance/Consultancy of prospective entrepreneurs.
- Project profiles.
-Entrepreneurship development programs.
- Motivational campaigns.
-Production index.
- Management development programs.
-Energy conservation.
-Quality control and up gradation.

-Export promotion.
-Market surveys.
-Intensive technical assistance.

Organizations under SSI:1) Regional Testing Centers (RTCs)

2) Field Testing Stations (FTSs)
3) Tool Rooms / Tool Design Industries (TRs/TDs)
4) Trading institutes:
- National Institute of Small Industry Extension Training (NISIET)
-National Institute for Entrepreneurship and small business development (NIESBUD), New
Delhi.
-Integrated Training Centre (Industries), Nilokhedi (Haryana).
5) Product-cum- Process Development Centre (PPDICs)
Six centers are in existence. There are:- Firozabad for Glass Industry.
- Kannauj for Essential Oils.
- Meerut for Sports Goods and Leisure Time Equipment.
- Agra for foundry and forgings.
- Ramnagar for Electronic Industries.
-Mumbai for Electrical Measuring Instruments.
The main motive of these centres is to upgrade the technology of the manufacturer and help in
energy conservation.

Training Institutes:- All the three training institutes mentioned above are an autonomous body
and are under the administrative control of the office of DC (SSI).Their objectives is to identify and
motivate traditional /non traditional entrepreneurs and to provide training at National and International
level .These institutes provide training by imparting seminars and workshops on topical issues . The
integrated Training Centre (Industry), Nilokhedi is the only institute that imparts training to the junior
field staff i.e. Investigators / SIPOs to expose to and educate them in the programmes and policies of
development and promotion of small industries. At present its training consists of courses like
1) Rewinding of electric motors and house wiring.
2) Repair to diesel engine and agricultural water pumps.
3) Servicing and repair to automobiles (cars and scooters).

PROJECTED REPORT

SCREW MANUFACTURING INDUSRTY

INTRODUCTION
MARKET POTENTIAL
BASIS & PRESUMPTIONS
PREOCESS OF MANUFACTURING
IMPLEMENTATION SCHEDULE
PROCESS FLOW CHART

INTRODUCTION
PROJECT DESCRIPTION: Wood screws are used almost in all of household furniture,
wood materials, furniture industries etc. it is a metal screw with a sharp point designed to
attach two pieces of wood together. Wood screws are commonly available with flat, pan
or oval heads. A wood screw generally has a unthreaded portion below the head. He
unthreaded portion of the shank is designed to slide through the top board (closest to
screw head) so that it can be pulled tight to the board it is being attached to.
The wood screws have a very wide market all over the country. The machines, equipments and
raw material for manufacturing wood screws are easily available and the technology is fully in
designed. The unit can be set up in all major cities or near the city area and requires very nominal
investment in plant and machines. Also the power consumption is not very much. So its
production is economical and also pollution free.

MARKET POTENTIAL:The practical applications of screws are almost endless: They are used in industries ranging from
construction to electronics and can be used for almost any project that requires two or more
objects to be firmly connected.Wood screws have a very wide and never ending market as
almost all the house incorporate wood materials and also in the wood furniture manufacturing
units and all shops working in the field of wood furniture will require it and in all the wood
material wood screw is to be used and its importance cant be deny. These are always required in
almost all the homes. Different sizes of screws for different end use are packed in printed paper
packets and sold either by per packets or per kg of screws.

BASIS AND PRESUMPTIONS

The project report has been prepared keeping in view the following basis and presumptions while
calculating the cost of project and that of production
1. Unit will run 9 hours per day for 310 working days in a year.
2. Unit will manufacture two types of wood screws.

1. upto 36mm long and 5mm dia

2. upto 50 mm long and 6 mm dia
3. Paper packets are got printed as per the requirements from outside .
4. Rates in respect of machines and equipment are based upon the rates quoted by a
particular manufacturer.
5. Rates of raw material and other inputs are based upon those prevailing in local market.
6. Unit will be running on single phase power motors .

Infrastructure Facilities
The place is well connected with roads, water line & high tension power lines. The electricity
will be available to the proposed firm as it is situated in well developed industrial town. All sorts
of infrastructure facilities like telephone, banking, road, transport & insurance services are also
incorporated.

Raw Material
Screws are generally made from low to medium carbon steel wire, but other tough and
inexpensive metals may be substituted, such as stainless steel, brass, nickel alloys, or aluminum
alloy. Quality of the metal used is of utmost importance in order to avoid cracking. If a finish is
applied to the screw, it must be of a compatible makeup. Steel may be coated or plated with zinc,
cadmium, nickel, or chromium for extra protection. These are easily available & can be bought

from the market of Delhi is already linked with metallic coils with these stations, so there is no
problem in procuring raw material.

Plant & Machinery

Machinery required for the wood screw making plant can be bought from well recognized
companies which provide it at affordable prices. We will purchase it from ABM TOOLS one of
its Head Quarter is situated in Delhi,Mumbai and Kolkata. So we will purchage it from Delhi.

IMPLEMENTATION SCHEDULE
The implementation schedule for the project will be as under:
1. Preparation of project report after getting current rates for machines and raw material.
2. Arrangement for shade (rented) and electricity connection.
3. Provisional registration.
4. Arrangement of finance and placement of orders for machinery and equipment.
5. Procurement and installation of machinery and equipment.
6. Procurement of raw material.
7. Commencement of production.

Production Target
Based upon the single shift working of 9 hours per day and taking 310 working days in a year(26
in a month), the production of the unit will be as under :Production per day

960 pckts of 36/5mm screws

960 pckts of 50/6mm screws

Production time is for 8 hrs. 1 hr is for lunch break and tea breaks in whole day schedule.

How Are Screws Made?

The process of making these small fasteners is complex, but modern manufacturing processes
have made screws cheaper and more durable and precise.
1.

Early Screw Production

o

The concept of screws can be traced backed to approximately 200 B.C., but metal
screws that resemble the modern style weren't developed until the Renaissance Age,
between the 14th and 17th centuries A.D. These early screws were handmade, thus no
two screws were ever identical. In 1586, Jacques Besson introduced the first screwcutting machine, which would pave the way for future innovations. Job and William

Wyatt filed a patent for the first automatic screw-cutting machine in 1760; it could cut
roughly 10 screws per minute. In 1836, William Keane developed a thread-rolling
process. Although his efforts were mostly unsuccessful, thread rolling eventually became
the modern standard for screw production.
Modern Materials
The most common material used to make screws is low to medium carbon-steel

wire. Other durable and inexpensive metals that are sometimes substituted include brass,
stainless steel, nickel alloy and aluminum alloy. Some screws have a finish applied to
them for extra protection, which must be compatible with the raw materials of the screw.
Steel can be plated in zinc, cadmium, nickel or chromium.
Cold Heading
o

The mass manufacturing of screws is accomplished through cold heading and the
thread rolling method. A coil of wire is fed into a machine that straightens it, then directly
into another machine that cuts the wire into the desired lengths. A one- or two-punch
process die cuts the head of the screw into a preset shape. This process can produce
between 100 and 550 screw blanks per minute.

The cold heading machine cuts a length of wire and makes two blows on the end, forming a
head. In the head slotting machine, the screw blanks are clamped in the grooves around the
perimeter of the wheel. A circular cutter slots the screws as the wheel revolves.

Thread Rolling
o

The screw blanks are then guided down a chute that leads to one of three different
types of thread-cutting dies. If a reciprocating die is being used, the screw will be rolled
between one stationary flat die and one that moves back and forth alternately to create the
screw threads. A cylindrical die achieves the same basic result by rolling the screw
between two or three round dies. The planetary rotary die process holds the screw blank
in a stationary position while several die-cutting machines roll around the screw. All three
of these methods create screws that are stronger than those created using machine-cut
methods. This is because the threads are not actually cut into the screw blank but rather
pressed. Thread rolling ensures that no material is lost in the body of the screw, keeping
the metal strong while also creating more precisely positioned threads.

Quality Control
o

Standards for screw threads were established by the National Screw Thread
Commission in 1928; the main goal was to make screws more interchangeable. A unified
screw thread system was adopted in 1948 that focused on the number of threads per inch,
the pitch and shape of the thread and diameter sizes. In 1966, the International Standards
Organization suggested universal restrictions on metric and inch size ranges that have
become the accepted global standard.

PROCESS FLOW CHART

DOUBLE STROKE ( SOLID DIE ) COLD HEAD FORGING MACHINE

SCREW HEAD SLOTTING MACHINE

WOOD SCREW THREAD CUTTING MACHINE

SCREW HEAD SHAVING MACHINE

WOODEN POLISHING BARREL

INSPECTION

PACKING

STORE

DISPATCH

FINANCIAL ASPECT
A. Fixed Capital
(i) Land and Building
It is proposed to have rented Building

Amount (In Rs.)

20000.00

of about 800 Sq. fts. Covered area

@ Rs. 20000 (per month)

ii) Machinery and equipments (proposed)

1.

AUTOMATIC WOOD SCREW MAKING PLANT LENGTH UPTO 36MM

DOUBLE STROKE ( SOLID DIE ) COLD HEAD FORGING MACHINE

Length Of Screw

Upto 36mm

No. Of M/Cs Reqd.

Dia Of Screw

Upto 5mm (3/16)

Production Per Minute

110 - 125 Pcs

Motor Required

2 H.P.

Price

Rs. 2,31,000

Amount

One

Rs. 2,31,000

One

Rs. 91,000

SCREW HEAD SLOTTING MACHINE

Length Of Screw

Upto 40mm (1-1/2)

Dia Of Screw

3 5 Mm (3/16)

Production Per Minute

90 100 Pcs

Motor Required

1 H.P.

Price

Rs.91,000

WOOD SCREW THREAD CUTTING MACHINE

Capacity

9 -14 Swg X 36mm

Production Per Minute

Upto 25 Pcs

Motor Required

0.75 H.P.

Price

Rs. 73,000

Five

Rs. 3,65,000

Four

Rs. 2,92,000

TOTAL

Rs. 9,79,000

SCREW HEAD SHAVING MACHINE

Capacity

9 -14 Swg X 36mm

Production Per Minute

Upto 25 Pcs

Motor Required

1 H.P.

Price

Rs. 73,000

AUTOMATIC WOOD SCREW MAKING PLANT LENGTH UPTO 50MM

DOUBLE STROKE ( SOLID DIE ) COLD HEAD FORGING MACHINE

Length Of Screw

Upto 50mm

Dia Of Screw

Upto 6mm (1/4)

Production Per Minute

100 - 110 Pcs

Motor Required

5 H.P.

Price

Rs. 2,90,000

One

Rs. 2,90,000

One

Rs. 98,000

SCREW HEAD SLOTTING MACHINE

Length Of Screw

Upto 50mm (2)

Dia Of Screw

4 6 Mm (1/4)

Production Per Minute

80 90 Pcs

Motor Required

2 H.P.

Price

Rs.98,000

3.

WOOD SCREW THREAD CUTTING MACHINE

Capacity

4 - 12 Swg X 50mm

Production Per Minute

10 - 15 Pcs

Motor Required

1 H.P.

Price Without Elect.

Rs. 76,000

Five

Rs. 3,80,000

Four

Rs. 3,04,000

TOTAL

Rs. 10,72,000

SCREW HEAD SHAVING MACHINE

Capacity

7 - 12 Swg X 50mm

Production Per Minute

18 -20 Pcs

Motor Required

1 H.P.

Price Without Elect.

Rs. 76,000

WOODEN POLISHING BARREL

Price Without Elect.

Rs. 61,000

Item Code No.

Abm-Fm-6520

Motor Required

2 H.P.

TOTAL COST OF MACHINERY

9,79,000 + 10,72,000+61,000

=21,12,000.00

Installation and transportation

Charges @ 10%
Office equipment and furniture37845.00

2,11,200.00

TOTAL=

23,61,045.00

B. Working Capital ( per month )

(i) Salary and Wages
Sr. No.Particulars

Nos.

Amount

(In Rs.)

1)

Production supervisor

25000.00

Cum-InspectoR
2.)

Manager

28000.00

3)

Skilled Worker

90000.00

4)

Semi-skilled workers

25500.00

5)

Accountant

12000.00

6)

Unskilled-worker-cum-Helper

9000.00

7)

Storekeeper

7000.00

8)

Watchman

9000.00

TOTAL:

2,05,000.00

ii.) Raw Material

Sr. No.Particulars

Qty.

(In Rs.)
1)

SS Wire @ Rs. 97/ kg.

5,08,230.00

Amount

2)

Packing Material

40000.00

TOTAL:

548230.00

(iii) Utilities (per month)

Sr. No. Particulars

Amount

(In Rs.)

1)

Power requirement- 28HP

19552.00

single phase supply

Electricity Charges
(28x 0.746x 8x 26 x 4.50)

2)

Other Misc. Expenses

Total

24552.00

5000.00

(4) Other Contingent Expenses

Sr. No. Particulars

(In Rs.)

Amount

1)

Maintenance/Repair

2)

Postage and Stationary

3)

Traveling and Conveyance

4)

Misc. and Insurance

Total

10000.00
7500.00

12000.00

9600.00

39100.00

(5) Working Capital (per month)

Sr. No. Particulars

Amount

(In Rs.)

1)

Rent

20000.00

2)

Raw Material

3)

Salary/Wages

205000.00

4)

Utilities

24552.00

548230.00

5)

Other Contingent Expenditure

Total

39100.00

735882.00

C. Total Capital Investment

(i) Fixed Capital

Rs. 2112000.00

(ii) Working Capital for 3 months

Rs. 2207646.00
Total

Rs. 4319646.00
Or Rs. 4319646.00

FINANCIAL ANALYSIS
(i) Cost of Production (per month)
Sr. No. Particulars

Amount

(In Rs.)
1)

Total Recurring expenditure

(2) Turn-over (per month )

735882.00.

Sr. No. Particulars

Amount

(In Rs.)

1)

By sale of 985 pckts of

985x26x20

5,11,800 .00

864x26x30

6,73,920.00

30/5mm screws
2.)

By sale of 864 pckts of

50/6mm screws

Total

1185780.00

Less sale expenses @ 5%

Total

(3) Profit per month

59286.00

11,26,434.00

Rs. 11,26,434.00-735882.00.
= Rs. 3,90,550.00

(5.) Profit per year

(6) Profit on Sales

390550x12=4686600

34. 67%

(7 )

ANNUAL CHARGES

Depreciation on Machines @ 10%

3)

Depreciation of Office

211200.00

7569.00

Equipment @ 20%

4)

Total

Interest on capital @16%

5,56,689.00

(8)ANNUAL PROFIT= 4686600-5,56,689

= Rs. 41,29,911.00
(9)BREAK EVEN POINT

33,7920.00

MACHINERY SUPPLIERS
Address :79A, Pocket GG-1, VikasPuri,
New Delhi - 110 018, India
Tele : 91 11 2854 6891 / 91 9891027608
Fax : 91 11 2854 0898
E-mail : abmtools@vsnl.net
Website : www.abmfasteners.com