Project Profile at a glance

1. Name of the Project: Plywood Manufacturing Industry

2. Location within State/Country:
3 .Nearest Rail & Road
Connection:
4 .Estimated Capital Cost of the
Project:
Narnaul
Dist, MahendraGarh
State: Haryana
i) Nearest Railway station is Narnol Railway
ii) Nearest Road connection is State Highway and National
Highway
The total project cost is Rs..00

5 .Capital Equipment : Peeler

Veneer Dryer
Veneer Splinter
Veneer Splicer
Gluing Machine
Conveyor
Hot Press
Sanding Machine (Drum Sending)
Boiler with its accessories
Polishing

6 .Raw materials : Hardwood, Softwood & Adhesives.

7 .Environment Impact: The project is an environment friendly activity, only Government

certified timber will be used for production such as Eucalyptus
and Poplar.
.
8 .Foreign Exchange Cost component: Nil

1
9. Time-frame for selection & Completion
Project: Within a period of 12(Twelve) months.

10. Other General Information:
The competitive advantage of the project over other Plywood
production units in the State shall be in terms of volume of
production, quality and price because of the installation of
improved type machinery. Advantages over other units are due to
the availability of skilled manpower, adequate Raw materials
resources as well as high market potentials, security environment
to be created by the State Government especially for the above
project etc.

MISSION OF THE PROJECT

To provide jobs to rural skilled and unskilled people.

To develop the economy of the region.
To popular eco friendly products.
To obtain maximum growth with minimum investment.
To use the modern technology to the plywood industries.

2
 History and Origin

Plywood has it origins in laminating veneers around 3,500 years ago in Egypt during the days of the
Pharoahs. The early Greeks and Romans also used veneers and plywood mainly for furniture. From the
mid 1800s modern plywoods were utilized in pianos, furniture and tea chests.

Plywood came of age as a versatile construction material in the 1930s when water resistant resins were
used as glues giving plywood longevity and integrity. Australian plywood manufacture commenced in
Melbourne in 1911 but the two plants closed after a few years of operation.

Around 1914 plywood manufacture commenced in Woolloongabba, Brisbane. Thereafter Brisbane

became the main centre of plywood manufacturing activity with the 10 mills producing about two
thirds of all Australian production, thus making this city the logical base for the Plywood Association of
Australia.

The Australian industry expanded around the country after the second World War to the stage where in
1960 there were 63 mills. Around this time the local industry was under threat from imports, and other
panel products, so the industry invested heavily in CSIRO research to better understand the
manufacturing process and improve productivity.
In 1960 the mills used timber from indigenous forests with around 80% of the production being for
interior use. Today, the nine, on average much larger mills use mainly plantation timber with around
90% of the plywood produced being for structural applications.

As Australasian plywood can be used in critical structural applications where the costs of failure can be
high, there is a requirement for high reliability combined with consistent quality. This is provided by
the Plywood Association of Australias third party audited, process control based, industry wide quality
control program. Thus the PAA quality brand permits easy identification and assures the customer the
plywood is a quality product and meets the relevant Standard.

3
 MARKET POTENTIAL
Plywood products always have its demand in the market. The products are eco- friendly and cheap as
compared to the other plastic products. The different Plywood products have different categories of
customers. The Plywood products like furniture generally popular among the middle class people of the
regions.
POTENTIAL CUSTOMERS ARE AS FOLOWS AS
Furniture manufacturing company
Real Estate Developers
Retailers of the Plywood sheets
Government institutions like Railway, State Transport

MARKETING CHANNELS:-
The marketing channels plays important role in the distribution of the products to reach the potential
customers. The selection of the marketing channels is also important for the growth of the organization.
We will practice the following marketing channel:

Wholesaler & Distributor:

These People will represent our product in their region. They will be the main contact
point for the retailers and they will provide all services on behalf of our organization.

Industrial Merchants:
The registration with the trading companies like India mart and TradeIndia will also be
done as electronic channels are the most famous and cheapest way to gain customer.

4
 Plant location:-
The plant is located at following address
NARNAUL
DIST MahendraGarh
STATE- Haryana
The factors influenced to choose the plant layout are as follows as
1. Availability of raw materials:-
Hardwood and softwood is easily available in the region and the transportation cost is also less.
Eucalyptus and Poplar Core Veneer of the best quality is easily available in the Western Uttar
Pradesh and Uttarakhand Region, we will be having Long Term Agreement with suppliers from
those region so that we can produce best quality plywood. Also
2. Availability 0f skillful labour force:-
Most of the plywood units are installed in other district of Haryana and due to that the skilled
labour force migrates to those region, we are looking forward to cater the needs of those skilled
and unskilled labor of our region.
3. Good transportation facilities:-
The place is well connected to the National Highway and State Highway

4. Availability of the power and water supply:

The power supply is from Haryana State Government and apart from that we will be installing
Generator of any sort of emergency.

5
 Raw Materials

The outer layers of plywood are known respectively as the face. The face is the surface that is to be
used or seen. The center layer is known as the core. In plywood with five or more plies, the inter-
mediate layers are known as the crossbands.

Plywood may be made from hardwoods, softwoods, or a combination of the two. Some common
hardwoods include eucalyptus, maple, pine, oak, and teak. The most common softwood used to make
plywood in India is poplar.

Composite plywood has a core made of particleboard or solid lumber pieces joined edge to edge. It is
finished with a plywood veneer face and back. Composite plywood is used where very thick sheets are
needed.

The type of adhesive used to bond the layers of wood together depends on the specific application for
the finished plywood. Softwood plywood sheets designed for installation on the exterior of a structure
usually use a phenol-formaldehyde resin as an adhesive because of its excellent strength and resistance
to moisture. Softwood plywood sheets designed for installation on the interior of a structure may use a
blood protein or a soybean protein adhesive, although most softwood interior sheets are now made with
the same phenol-formaldehyde resin used for exterior sheets. Hardwood plywood used for interior
applications and in the construction of furniture usually is made with a urea-formaldehyde resin.

Some applications require plywood sheets that have a thin layer of plastic, metal, or resin-impregnated
paper or fabric bonded to either the face or back (or both) to give the outer surface additional resistance
to moisture and abrasion or to improve its paint-holding properties. Such plywood is called overlaid
plywood and is commonly used in the construction, transportation, and agricultural industries.

Other plywood sheets may be coated with a liquid stain to give the surfaces a finished appearance, or
may be treated with various chemicals to improve the plywood's flame resistance or resistance to decay.

6
 Plywood Classification and Grading

There are two broad classes of plywood, each with its own grading system.

One class is known as construction and industrial. Plywoods in this class are used primarily for their
strength and are rated by their exposure capability and the grade of veneer used on the face and back.
Exposure capability may be interior or exterior, depending on the type of glue. Veneer grades may be
N, A, B, C, or D. N grade has very few surface defects, while D grade may have numerous knots and
splits. For example, plywood used for subflooring in a house is rated "Interior C-D". This means it has
a C face with a D back, and the glue is suitable for use in protected locations. The inner plies of all
construction and industrial plywood are made from grade C or D veneer, no matter what the rating.

The other class of plywood is known as hardwood and decorative. Plywoods in this class are used
primarily for their appearance and are graded in descending order of resistance to moisture as Technical
(Exterior), Type I (Exterior), Type II (Interior), and Type III (Interior). Their face veneers are virtually
free of defects.

Sizes

Plywood sheets range in thickness from 06 mm to 30 mm. The most common thicknesses are in the 6.4
mm to 19.0 mm range. Although the core, the crossbands, and the face and back of a sheet of
plywoodmay be made of different thickness veneers, the thickness of each must balance around the
center. For example, the face and back must be of equal thickness. Likewise the top and bottom
crossbands must be equal.

The most common size for plywood sheets used in building construction is 4 ft (1.2 m) wide by 8 ft
(2.4 m) long. Other common widths are 3 ft (0.9 m) and 5 ft (1.5 m). Lengths vary from 6 ft (2.4 m) to
12 ft (3.6 m) in 1 ft (0.3 m) increments. Special applications like boat building may require larger
sheets.

7
 The Manufacturing Process

The trees used to make plywood are generally smaller in diameter than those used to make lumber. In
most cases, they have been planted and grown in areas owned by the plywood company. These areas
are carefully managed to maximize tree growth and minimize damage from insects or fire.

Here is a typical sequence of operations for processing trees into standard 4 ft by 8 ft (1.2 m by 2.4 m)
plywood sheets:

The logs are first debarked and then cut into peeler blocks. In order to cut the blocks into strips of
veneer, they are first soaked and then peeled into strips.

Felling the trees

Selected trees in an area are marked as being ready to be cut down, or felled. The felling may be
done with gasoline-powered chain saws or with large hydraulic shears mounted on the front of
wheeled vehicles called fellers. The limbs are removed from the fallen trees with chain saws.
The trimmed tree trunks, or logs, are dragged to a loading area by wheeled vehicles called skidders.
The logs are cut to length and are loaded on trucks for the trip to the plywood mill, where they are
stacked in long piles known as log decks.

Preparing the logs

As logs are needed, they are picked up from the log decks by rubber-tired loaders and placed on
1a chain conveyor that brings them to the debarking machine. This machine removes the bark,
either with sharp-toothed grinding wheels or with jets of high-pressure water, while the log is
slowly rotated about its long axis.

8
 The debarked logs are carried into the mill on a chain conveyor where a huge circular saw cuts
them into sections about 8 ft-4 in (2.5 m) to 8 ft-6 in (2.6 m) long, suitable for making standard
8 ft (2.4 m) long sheets. These log sections are known as peeler blocks.

Making the veneer

Before the veneer can be cut, the peeler blocks must be heated and soaked to soften the wood.
The blocks may be steamed or immersed in hot water. This process takes 12-40 hours
depending on the type of wood, the diameter of the block, and other factors.
The heated peeler blocks are then transported to the peeler lathe, where they are automatically
aligned and fed into the lathe one at a time. As the lathe rotates the block rapidly about its long
axis, a full-length knife blade peels a continuous sheet of veneer from the surface of the
spinning block at a rate of 300-800 ft/min (90-240 m/min). When the diameter of the block is
reduced to about 3-4 in (230-305 mm), the remaining piece of wood, known as the peeler core,
is ejected from the lathe and a new peeler block is fed into place.
The long sheet of veneer emerging from / the peeler lathe may be processed immediately, or it
may be stored in long, multiple-level trays or wound onto rolls. In any case, the next process
involves cutting the veneer into usable widths, usually about 4 ft-6 in (1.4 m), for making
standard 4 ft (1.2 m) wide plywood sheets. At the same time, optical scanners look for sections
with unacceptable defects, and these are clipped out, leaving less than standard width pieces of
veneer.

9
 The wet strips of veneer are wound into a roll, while an optical scanner detects any unacceptable
defects in the wood. Once dried the veneer is graded and stacked. Selected sections of veneer
are glued together. A hot press is used to seal the veneer into one solid piece of plywood, which
will be trimmed and sanded before being stamped with its appropriate grade.

The sections of veneer are then sorted and stacked according to grade. This may be done
manually, or it may be done automatically using optical scanners.
The sorted sections are fed into a dryer to reduce their moisture content and allow them to
shrink before they are glued together. Most plywood mills use a mechanical dryer in which the
pieces move continuously through a heated chamber. In some dryers, jets of high-velocity,
heated air are blown across the surface of the pieces to speed the drying process.
As the sections of veneer emerge from the dryer, they are stacked according to grade.
Underwidth sections have additional veneer spliced on with tape or glue to make pieces suitable
for use in the interior layers where appearance and strength are less important.
. Those sections of veneer that will be installed crosswaysthe core in three-ply sheets, or the
crossbands in five-ply sheetsare cut into lengths of about 4 ft-3 in (1.3 m).

10
Forming the plywood sheets
When the appropriate sections of veneer are assembled for a particular run of plywood, the
process of laying up and gluing the pieces together begins. This may be done manually or semi-
automatically with machines. In the simplest case of three-ply sheets, the back veneer is laid flat
and is run through a glue spreader, which applies a layer of glue to the upper surface. The short
sections of core veneer are then laid crossways on top of the glued back, and the whole sheet is
run through the glue spreader a second time. Finally, the face veneer is laid on top of the glued
core, and the sheet is stacked with other sheets waiting to go into the press.
The glued sheets are loaded into a multiple-opening hot press. presses can handle 20-40 sheets
at a time, with each sheet loaded in a separate slot. When all the sheets are loaded, the press
squeezes them together under a pressure of about 110-200 psi (7.6-13.8 bar), while at the same
time heating them to a temperature of about 230-315 F (109.9-157.2 C). The pressure assures
good contact between the layers of veneer, and the heat causes the glue to cure properly for
maximum strength. After a period of 2-7 minutes, the press is opened and the sheets are
unloaded.
The rough sheets then pass through a set of saws, which trim them to their final width and
length. Higher grade sheets pass through a set of 4 ft (1.2 m) wide belt sanders, which sand both
the face and back. Intermediate grade sheets are manually spot sanded to clean up rough areas.
Some sheets are run through a set of circular saw blades, which cut shallow grooves in the face
to give the plywood a textured appearance. After a final inspection, any remaining defects are
repaired.
The finished sheets are stamped with a grade-trademark that gives the buyer information about
the exposure rating, grade, mill number, and other factors. Sheets of the same grade-trademark
are strapped together in stacks and moved to the warehouse to await shipment.

FUTURE PLANNING FOR THE EXPANSION:-

11
Even though plywood makes fairly efficient use of treesessentially taking them apart and putting
them back together in a stronger, more usable configurationthere is still considerable waste inherent
in the manufacturing process. In most cases, only about 65-75% of the usable volume of wood in a tree
is converted into plywood. To improve this figure, several new products are under development.

One new product is called oriented strand board, which is made by shredding the entire log into strands,
rather than peeling a veneer from the log and discarding the core. The strands are mixed with an
adhesive and compressed into layers with the grain running in one direction. These compressed layers
are then oriented at right angles to each other, like plywood, and are bonded together. Oriented strand
board is as strong as plywood and costs slightly less.

List of the machine to be used in the manufacturing process and their cost of purchase:-

12
General Plywood Processing Machine
1. Spindless Peeling Machine:
This machine is used to peel the wood log and make core veneer which is then used
for making plywood. We will be using spindles peeling machine which consumes
less electricity and produces more veneer.

2. Roller Veneer Dryer:

Veneer Dryer is used to dry the veneer so that it absorbs the glue in the next process
well and also the moisture is removed from veneer to make the bonding better while
manufacturing plywood

13
3. Glue Spreader :

4. Hydraulic Hot Press Machine:

'BS' Make, Hydraulically operated steam/oil heated multi daylight Hot Press in
upclosing frame. The main body is fabricated from M.S. Plate and Hot Platens are
also fabricated from solid plate as well as complete with Automatic Powerpack,
steam connection pipes and other necessary parts and components.

14
5. Steam Boiler :

6. Chimney(30m) with ladder:

15
7. Heat Recovery unit (Air Pre-Heater):

16
SOURCES OF FINANCE:-
Supply of finance is very important factor in the establishment of an enterprise is old. Finance is the life
line of the business. Finance deals with the arrangements of the sufficient capital for the smooth run of
the organization. Following are the certain sources of the scheme of the finance.
A) OWN CAPITAL:-
According to the rules set up by various financial institution 25% to 35% of the capital should be the
own investment of the entrepreneur. 30% of the project cost will be financed by the promoter himself.
B) TERM LOAN FROM THE COMMERCIAL BANKS:
Loan will be applied to the bank once the license is issued
C) TERM LOANS FROM THE NATIONAL SMALL INDUSTRIES CORPORATION:-
NSIC provides loans at 8.5% to small scale industries for the development of the working capital
requirement.

COST OF THE PROJECT

SR.NO PARTICULARS AMOUNT
01 Land
02 Site development
03 Building
03 Plant and machinery
04 Furniture and Misc 1,75,000.00
05 Preliminary and preoperative exp.
06 Depreciation
06 Working capital (3months)
TOTAL .00

MEANS OF FINANCE:
SR.NO RATE OF PARTICULARS AMOUNT
INTEREST

17
01 NIL Promoters Capital .00
02 11% Bank Loan .00
03 8.5% NSICL
TOTAL .00

TOTAL FIXED CAPITAL:

SR.NO PARTICULARS AMOUNT
01 Land .00
02 Site development .00
03 Building .00
03 Plant and machinery .00
04 Furniture and Misc .00
05 Preliminary and preoperative exp. .00
06 Depreciation .00
TOTAL .00

1. LAND:
Sr. No Particulars Price/Acre Amount
01 Land area .00 .00
(2 acre)

2. SITE DEVELOPMENT
Sr. no Particulars Cost of the Amount
items
O1 Filling of the land .00 000.00
02 Fencing
18
03 Gardening
04 Gates
Total .00 .00
3. BUILDING
Sr. no Particulars Cost of the Amount
items
01 Corporate office .00
02 Show room 00 0.00
03 Toilets 1,50,000.00 1,50,000.00
05 Store room 4,00,000.00 4,00,000.00
Total .00 ,00

4. PLANT AND MACHINERY:

Sr. no Particulars Quantity Amount
Peeling Machine 2 50,00,000.00
Dryer 1 20,00,000.00
Glue Mixer 2
Glue Spreader 4
01 Hydrualic Hot press 02 55,50,000.00
machine
02 Steam Boiler 01 13,75,000.00
03 Chimney(30m) with 01 3,75,000.00
ladder
04 Heat Recovery unit (Air 01 1,80,000.00
Pre-Heater)
05 Multi Cyclone Dust 01 1,75,000.00
Collector
06 Pressure Reducing 01 2,25,000.00
Station
Add Transportation 1.00,000.00
Installation 1,00,000.00
19
 Total cost ,000.00
5. PRELIMINARY AND PRE.OPERATIVE EXPENSES:-
Sr. No Particulars Amount
01 Deposit for power ,water , telephone .00
02 Loan application process fee .00
03 Deposit for internet .00
04 Legal stamp duty and registration .00
05 Travelling .00
06 Consultancy .00
Total .00

5.FURNITURE AND MICELLANOUS ASSETS:-

sr. no Particulars Quantity Amount
O1 Furniture

Office chairs 8set .00

Almirah 8 .00
Racks 20 .00
Tables 2 .00
Computer and accessories 1 .00
Fans 8 .00
Sofa 1 .00
02 Work shed ------- 00

Total .00

6.DEPRECIATION (P.A)
Sr. No Type of assets Cost of assets Rate of Amount
dep.
01 Plant and machinery .00 10% .00

20
02 Furniture ,00 10% .00
03 Building .00 5% .00
Total .00 .00

WORKING CAPITAL REQUIREMENT:-

Sr. no Particulars 1 month 3 month
01 Raw materials 9,15,000.00 27,45,000.00
02 Salary and wages 1,35,500.00 4,06,500.00
03 Other manufacturing 12,000.00 36,000.00
expenses
04 Power and fuels .00 .00
05 Selling and office 17000.00 2,04,000.00
expenses
Total .00 00.00

1. RAW MATERIALS:-
Sr.No Particulars No. of price /piece Cost /month Cost /year
Tons/month (Rs)
01 Softwood 250 2000 5,00,000.00 60,00,000.00
02 Hardwood 50 3000 1,75,000.00 21,00,000.00
03 Adhesive 2 1,20,000 2,40,00.00 28,80,000.00
Total 9,15,000.00 1,09,80,000.00

21
2. SALARY AND WAGES:-
Sr.no Name of the No per Salary/head Salaries/month Salaries/year
post post
01 Manager 01 15,000.00 15,000.00 1,80,000.00
02 Accountant 01 8,000.00 8,000.00 96,000.00
03 Office staff 02 7,000.00 .00 1,20,000.00
04 Chemist 01 6,500.00 00 54,000.00
05 Supervisor 01 5,000.00 .00 48,000.00
06 Machine 10 4,200.00 .00 4,60,800.00
Operator
07 Skilled labour 20 3200.00 .00 1,94,400.00
08 Unskilled 110 3000 .00 3,16,800.00
worker
09 Mechanic-cum 02 3,000 .00 60,000.00
Electrician
Total 31 .00 16,26,000.00

3. POWER AND FUELS:-

Sr.No Particulars P.M. P.A.
01 Fuels .00 .00
02 Power .00
Total .00 .00

4. OTHER MANUFACTURING EXPENSES :-

Sr.No Particulars P.M. P.A.
01 Paints 4,000.00 48,000.00
02 Packaging materials 2,000.00 24,000.00
03 Repairing of the machines 4,000.00 48,000.00

22
 Total 12,000.00 1,44,000.00

5. OFFICE,SELLING, DISTRIBUTION EXPENSES:

Sr.No Particulars P.M. P.A.
01 Postage and stationeries 3,000.00 36,000.00
02 Telephone bills/internets 4,000.00 48,000.00
03 Transportation 10,000.00 1,20,000.00
Total 17,000.00 9,87,000.00

VARIABLE COST:
Sr.No Particulars P.M. P.A.
01 Raw materials(100%)
02 Wages (80%) .00
03 Power and fuels(90%)
04 0ther manufacturing .00 .00
expense(100%)
05 Interest w/c loans (80%) 00 .00

06 Interest term loans (20%) .00 .00

07 Selling and administrative .00 .00
expenses (100%)
Total 00 00
FIXED COST:-
Sr.No Particulars P.M. P.A.
01 Wages (20%) 00 .00
02 Power and fuels(10%) .00 .00
03 Interest on w/c (20%) .00 .00
04 Interest on term loans (80%) .00 .00
05 Office, selling , distribution 00 .00
expenses (90%)
06 Depreciation(100%) .00 .00
Total .00 .00

23
COST OF THE PRODUCTION:-
Sr. no Particulars 1 month 1 year
01 Raw materials 00 .00
02 Salary and wages .00 .00
03 Other manufacturing .00 .00
expenses
04 Consumables .00 .00
05 Repairing of machine .00 ,00
06 Depreciation @10%
07 Plant and machineries .00 .00
Furniture .00 .00
Total .00 .00

ESTIMATED SALE:-
Sr. no Items No items Price Monthy Annually sales
sold /item sales
/month
01 6mm plywood sheets

3*6 21 .00 .00

3*8 34 .00 .00
4*6 50 .00 .00
4*8 5 .00 .00
0
TOTAL 165 00 .00
02 8 mm plywood sheet
3*6 30 .00 .00
3*8 44 .00
4*6 67 .00 .00
4*8 66 .00 .00
TOTAL 207 .00 .00
03 12 mm plywood sheet

24
 3*6 44 .00 .00
3*8 66 .00 .00
4*6 100 .00 .00
4*8 100 .00 .00
TOTAL 300 .00 .00
04 18 mm plywood sheet
3*6 25 .00 .00
3*8 33 .00 .00
4*6 50 .00 .00
4*8 50 .00 .00
TOTAL .00

PROFITABILITY:-
Sr.no Particulars P.M P.A.
01 Sales .00 .00
02 Less Cost of production .00 .00
03 Gross .00 .00
profit
04 Less Office, selling, .00 .00
distribution
05 Less Interest on loan
@11% (Bank) .00 .00
@8.5%(SIDC) .00 .00

06 Net profit .00 .00

25
BREAK EVEN POINT:
Formula used

FIXED COST
B.E.P= X 100
CONTRIBUTION

CONTRIBUTION=SALES-VARIABLE COST
CONTRIBUTION=

18, 97,284.00
B.E.P= _____________ X100 =32.21%
58, 90, 308.00

26