Pre-Feasibility Study

FURNITURE SHOWROOM

Small and Medium Enterprise Development Authority

Government of Pakistan
www.smeda.org.pk
HEAD OFFICE
6th Floor LDA Plaza Egerton Road, Lahore
Tel (042)111 111 456,
Fax: (042) 36304926-7
helpdesk@smeda.org.pk

REGIONAL OFFICE REGIONAL OFFICE REGIONAL OFFICE REGIONAL OFFICE

PUNJAB SINDH KHYBER PAKTUNKHWA BALOCHISTAN

8th Floor LDA Plaza, 5TH Floor, Bahria Complex II, Ground Floor Bungalow No. 15-A Chamn
Egerton Road, M.T. Khan Road, State Life Building The Mall, Housing Scheme Airport Road,
Lahore. Karachi. Peshawar. Quetta.
Tel: (042) 111 111 456, Tel: (021) 111-111-456 Tel: (091)111 111 456, 9213046-7 Tel: (081) 2831623, 2831702
Fax: (042) 36370474 Fax: (021) 35610572 Fax: (091) 286908 Fax: (081) 2831922
helpdesk.punjab@smeda.org.pk helpdesk.sindh@smeda.org.pk helpdesk.NWFP@smeda.org.pk helpdesk.balochistan@smeda.org.pk

January, 2011
Pre-feasibility Furniture Showroom

1 EXECUTIVE SUMMARY................................................................................................................. 5
2 INTRODUCTION TO SMEDA ........................................................................................................ 6
3 PURPOSE OF THE DOCUMENT ................................................................................................... 6
4 CRITICAL SUCCESS FACTORS IN DECISION MAKING FOR INVESTMENT .................. 7
4.1 SWOT ANALYSIS ..................................................................................................................... 7
4.1.1 Strengths ................................................................................................................................. 7
4.1.2 Weaknesses ............................................................................................................................. 7
4.1.3 Opportunities .......................................................................................................................... 7
4.1.4 Threats.................................................................................................................................... 8
4.2 KEY SUCCESS FACTORS ........................................................................................................ 8
4.2.1 Quality of raw material .......................................................................................................... 8
4.2.2 Attractive Design and Quality Finishing ................................................................................ 8
4.2.3 Sales promotion ...................................................................................................................... 9
4.2.4 Other Success Factors ............................................................................................................ 9
5 PROJECT PROFILE ......................................................................................................................... 9
5.1 OPPORTUNITY RATIONALE.................................................................................................. 9
5.2 PROJECT BRIEF ...................................................................................................................... 10
5.3 TARGET MARKET.................................................................................................................. 10
5.4 MARKET ENTRY TIME ......................................................................................................... 10
5.5 PROPOSED BUSINESS LEGAL STATUS ............................................................................. 10
5.6 PROJECT CAPACITY AND RATIONALE ............................................................................ 10
5.7 PROPOSED LOCATION ......................................................................................................... 10
5.8 PROJECT INVESTMENT........................................................................................................ 11
6 INDUSTRY STRUCTURE .............................................................................................................. 11
6.1 FURNITURE CLUSTERS IN PAKISTAN .............................................................................. 12
6.1.1 Gujrat ................................................................................................................................... 12
6.1.2 Lahore................................................................................................................................... 12
6.1.3 Chiniot .................................................................................................................................. 12
7 WORLD IMPORTS AND EXPORTS ............................................................................................ 13
8 MARKET INFORMATION ABOUT FURNITURE .................................................................... 14
8.1 REQUIREMENT OF WOODEN FURNITURE ....................................................................... 14
9 PROJECT MARKETING STRATEGY......................................................................................... 15
9.1 MARKETING STRATEGY ..................................................................................................... 15
9.2 TRENDS IN FURNITURE STYLE .......................................................................................... 15
9.3 TRENDS IN MATERIALS, COLOURS AND SHAPES.......................................................... 15
9.3.1 Materials commonly used ..................................................................................................... 16
10 PROPOSED PRODUCT MIX ......................................................................................................... 16
11 HUMAN RESOURCE REQUIREMENT ...................................................................................... 17
11.1 HUMAN RESOURCE REQUIREMENTS .......................................................................................... 17
12 OFFICE EQUIPMENT.................................................................................................................... 18
13 LAND & BUILDING REQUIREMENT ........................................................................................ 18
14 KEY ASSUMPTIONS ...................................................................................................................... 19
14.1 PROJECT ASSUMPTIONS ............................................................................................................. 19
14.2 OPERATING ASSUMPTIONS ......................................................................................................... 19
14.3 DEPRECIATION RATE ASSUMPTIONS .......................................................................................... 19

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14.4 CASH FLOW ASSUMPTIONS ........................................................................................................ 19

14.5 MISCELLANEOUS ASSUMPTIONS ................................................................................................ 20
14.6 EXPENSE ASSUMPTIONS ............................................................................................................. 20
14.7 REVENUE ASSUMPTIONS ............................................................................................................ 20
14.8 REVENUE ASSUMPTIONS - PRODUCT MIX .................................................................................. 20
14.9 REVENUE ASSUMPTIONS - SALES PRICE ..................................................................................... 21
14.10 COST OF SALES .......................................................................................................................... 21
15 FINANCIAL STATEMENTS.......................................................................................................... 22
15.1 PROJECT COST ........................................................................................................................... 22
15.2 INCOME STATEMENT .................................................................................................................. 23
15.3 BALANCE SHEET ........................................................................................................................ 24
15.4 CASH FLOW STATEMENT ........................................................................................................... 25
16 ANNEXURE...................................................................................................................................... 26
16.1 MAJOR FURNITURE SUPPLIERS AND MANUFACTURERS ............................................................. 26
16.2 TAX DEDUCTION INCOME SLABS ................................................................................................ 26

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DISCLAIMER

The purpose and scope of this information memorandum is to introduce the subject
matter and provide a general idea and information on the said area. All the material
included in this document is based on data/information gathered from various sources and
is based on certain assumptions. Although, due care and diligence has been taken to
compile this document, the contained information may vary due to any change in any of
the concerned factors, and the actual results may differ substantially from the presented
information. SMEDA does not assume any liability for any financial or other loss
resulting from this memorandum in consequence of undertaking this activity. The
prospective user of this memorandum is encouraged to carry out additional diligence and
gather any information he/she feels necessary for making an informed decision.
For more information on services offered by SMEDA, please contact our website:
www.smeda.org.pk

DOCUMENT CONTROL

Document No. PREF-99

Revision 2

Prepared by SMEDA-Punjab

Issue Date June 2006

Revision Date January, 2011

Issued by Library Officer

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Pre-feasibility Furniture Showroom

1 EXECUTIVE SUMMARY
The project involves establishing a Furniture Showroom at a central location of any big
city of Pakistan. The showroom will cater to the needs of the domestic market, selling
quality wooden furniture for household and office use. The furniture will be outsourced
from local manufacturers in Gujrat and Chiniot. The showroom will provide its own
designs as well as take orders for customized furniture. The outlet will offer a product
mix of household furniture including bedroom sets, dining room, common room and
drawing room furniture. Additionally office furniture will also be available in the
showroom.
Pakistan is one of the oldest furniture manufacturing industries. The furniture industry is
divided into two main types: cottage and small scale industries. The industry is aiming at
developing a system designed to incorporate its tradition with modern functional
demands, coupled with a quality of the material and aesthetic values. The medium sized
and the small sized units have their showrooms and some micro sized manufacturers
don’t have their own showrooms, so they are dependent on outlets set up in cities like
Lahore, Sialkot, Gujranwala, Rawalpindi, Islamabad, Peshawar, Karachi, Quetta etc. In
Lahore there are many clusters of furniture showrooms in central locations like Fortress
Stadium, Gulberg, DHA, Allama Iqbal Town, Ferozepur Road and Multan Road.
The total project cost for setting up the showroom is estimated at Rs. 5.571 million. The
project is financed through 50% debt and 50% equity. The project NPV is around Rs.
2.121 million, with an IRR of 29% and payback period of 3.78 years. The legal business
status of this project is proposed as ‘Sole Proprietorship’.
The showroom will be open for 11 hours everyday. Given the business type a fixed sales
capacity can not be determined. It is assumed that 525 sets of furniture are sold in the first
year from among the product mix defined. The projected sales are increasing at a rate of
5% each year. The projected sale figures given in the project are only an approximation
and actual sales may vary significantly depending on how well the showroom caters to
the market requirement and how strong its marketing strategy is.

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2 INTRODUCTION TO SMEDA
The Small and Medium Enterprises Development Authority (SMEDA) was established
with the objective to provide fresh impetus to the economy through the launch of an
aggressive SME support program.
Since its inception in October 1998, SMEDA adopted a sectoral SME development
approach. A few priority sectors were selected on the criterion of SME presence. In depth
research was conducted and comprehensive development plans were formulated after
identification of impediments and retardants. The all-encompassing sectoral development
strategy involved recommending changes in the regulatory environment by taking into
consideration other important aspects including finance, marketing, technology and
human resource development.
SMEDA has so far successfully formulated strategies for industries such as horticulture,
including export of fruits and vegetables, marble and granite, gems and jewellery, marine
fisheries, leather and footwear, textiles, surgical instruments, transport, dairy etc.
Whereas the task of SME development at a broader scale still requires more coverage and
enhanced reach in terms of SMEDA’s areas of operation.
Along with the sectoral focus a broad spectrum of business development services is also
offered to the SMEs by SMEDA. These services include identification of viable business
opportunities for potential SME investors. In order to facilitate these investors, SMEDA
provides business guidance through its help desk services as well as development of
project specific documents. These documents consist of information required to make
well-researched investment decisions. Pre-feasibility studies and business plan
development are some of the services provided to enhance the capacity of individual
SMEs to exploit viable business opportunities in a better way.
This document is in the continuation of this effort to enable potential investors to make
well-informed investment decisions.

3 PURPOSE OF THE DOCUMENT

The objective of this proposed Pre-feasibility is primarily to facilitate potential
entrepreneurs with the investment information and provide an overview about the
"Furniture Show Room Business". The project pre-feasibility may form the basis of an
important investment decision and in order to serve this objective, the document/study
covers various aspects of project concept development, start-up, and marketing, finance
and business management. The document also provides sectoral information and
international scenario, which have some bearing on the project itself.
The purpose of this document is to facilitate potential investors of the Furniture
Showroom business by providing them a macro and micro view of the business with the
hope that the information provided herein will aid the potential investors in crucial
investment decisions.
This particular Pre-feasibility is regarding setting up "Furniture Show Room". Our report
is based on the information obtained by us from industry sources as well as our
discussions with businessmen. For financial model, since the forecast/projections relate to

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the future periods, actual results are likely to differ because of the events and
circumstances that don’t occur as frequently as expected.

4 CRITICAL SUCCESS FACTORS IN DECISION MAKING FOR INVESTMENT

4.1 SWOT ANALYSIS
Wood is the main raw material used in furniture making and the entire finished product
depends on quality of wood. The information and technical know how about the quality
of wood and use of seasoned (dry) wood plays a vital role in the manufacturing of good
quality furniture, which will ultimately reflect on the reputation of the furniture show
room. Strong competition exists in the international and domestic market. Manufacturing
and sale of high quality trendy designs and good marketing is essential to get a permanent
place in the market. Real wood furniture is the most popular furniture in existence; it's
been around for hundreds of years.
Before making the decision, whether to invest in setting up the Furniture Show Room or
not, one should carefully analyze the associated risk factors. A SWOT analysis can help
in analyzing these factors, which can play an important role in making the decision.
4.1.1 Strengths
1. Availability of high quality furniture to customers
2. Variety of traditional and modern designs of locally manufactured furniture will be
available in the showroom.
3. A number of suppliers available in the local market, for instance the Chiniot and
Gujrat furniture market.
4. Profit margins can be as high as 100%
5. Central location of the showroom in a big city, easily accessible to the target market.
6. The showroom is proposed to be open 11 hours a day.
7. A product mix that includes furniture for both household and official use.
4.1.2 Weaknesses
1. A number of competitors in the market.
2. Easy market entry
3. Seasonal sector (especially household furniture in the wedding season – November to
March).
4. Heavy investment in the working capital.
5. Very strict quality check required.
6. Dependency on the supplier for timely delivery of orders.
4.1.3 Opportunities
1. High quality furniture being produced locally at competitive rates and in large
quantities.

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2. The life style of the people is improving and they are getting more quality conscious,
thus preference for the high quality products is increasing.
3. With an overall increase in income levels people are willing to spend more on house
renovation and decoration.
4. Continuous increase in construction and renovation of houses and offices create new
opportunities.
5. Market share can be acquired from un-organized sector through high quality product
and promotional activity.
4.1.4 Threats
1. Lack of tree plantation resulted in lack of raw material (wood.)
2. The prices of all raw materials such as chipboard, timber, foam, polish chemical
materials, colour paints and hard ware have increased
3. Heavy imports of furniture particularly from China
4. Local furniture manufacturers face high costs and poor output due to obsolete
machinery, inadequate tools and manual labour.
5. Furniture trends and designs change rapidly.
6. Several established competitors enjoy a good market share.
4.2 KEY SUCCESS FACTORS
4.2.1 Quality of raw material
The furniture industry in Pakistan is dependent on the quality of the raw material
available. The high quality wood is scarce in Pakistan and customer complaints arise due
to the use of cheap and low quality wood by the manufacturers. It has to be ensured that
furniture displayed in the showroom and manufactured on orders must be of high quality
raw material.
4.2.2 Attractive Design and Quality Finishing
The life style of the people is improving and they are getting more quality conscious.
Contemporary and chic designs are better liked by people these days. Special attention
should be given to present latest designs according to the current market demands and
requirements.
Tastefully designed and knockdown furniture items, made of superior quality wood and
light weighted are more suitable for sale purposes.
New designs and styles with durability can build brand equity for the business. As there
is high competition in market, creation of up-to-date designs and styles, and introducing
new trends is vital.
As this proposed showroom business is expected to target middle to upper middle class,
the furniture should be able to fulfil their special requirements. It is therefore more
important that furniture should be aiming to cater the traditions with modern functional
demands, coupled with quality of the material and aesthetic sense. It is of utmost

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importance that furniture should be durable and of the latest style and fashion at an
economical cost so as to attract the relevant class of the society.
4.2.3 Sales promotion
Another critical success factor of this proposed pre-feasibility is the Marketing and
Promotion of the Furniture. Sales promotion activity is necessary for market penetration.
This involves dedication and hard work from the marketing personnel and advertisement
through print media along with the use of other marketing techniques.
4.2.4 Other Success Factors
1. Advance orders for sale can ensure the success of the business.
2. Assurance to customers that furniture is made of seasoned (dry) wood. Properly
seasoned (dry) wood guarantees high quality as it minimizes deformation of wood
due to dampness.
3. New designs and styles can build brand equity for business. As there is high
competition in market, to make the project commercially viable, creation of new
designs ands styles and setting new trends is vital
4. The location of the showroom is an important factor for success. The showroom
should be located in heavily populated or developed cities and its location within the
city should be decided keeping the target market in mind.
5. Responsiveness to customers' demands and requirements is very important to stay in
market and retain market share.
6. Better customer service and after sale service to promote business goodwill.
7. Competitive prices should be offered.

5 PROJECT PROFILE
5.1 OPPORTUNITY RATIONALE
Furniture Showroom is a viable business if done properly on commercial basis. With the
increase in the development of new housing schemes, increased demand of wooden
furniture can be anticipated. Furniture is also given as part of the dowry which forms the
major portion of sales of furniture in Pakistan. The demand for household furniture
increases substantially in winter and spring season which is the wedding season in
Pakistan. Domestic/office requirements and trend of dowry in the form of furniture
considerably increases the need for quality furniture.
The demand for household furniture and accessories directly correlate with new
residential construction, and office furniture follows trends in non-residential
construction. A growing segment is the renovation, maintenance and improvement sector.
Some furniture manufacturers do not have their own showrooms and are dependant upon
other sources for furniture sales. The medium sized and the small sized units have their
showrooms. The micro sized manufacturers don’t have their own showrooms, so they are
dependent on the other categories for their furniture sales. Around 10% of the total
furniture manufactured in Gujrat is sold within the city. The rest 90% of the furniture is

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sold in the other cities like Lahore, Sialkot, Gujranwala, Rawalpindi, Islamabad,
Peshawar, Karachi, Quetta etc.
5.2 PROJECT BRIEF
The proposed project is for setting up FURNITURE SHOWROOM. This project is
only concerned with “Furniture Showroom” and does not include manufacturing facility.
The furniture is proposed to be outsourced from various local manufacturers. The
showroom will provide its own designs as well as customized designs to its customers.
The products covered in this pre-feasibility are domestic or household furniture and
office furniture in finished form. It specifically excludes the contract sector, which
includes furniture for civil aviation, hospitals, schools, and other similar purposes.
Antique, second-hand furniture and garden furniture has been excluded as well.
5.3 TARGET MARKET
The target market proposed for this project is middle to upper middle class. Nowadays
the demand is for quality furniture at a reasonable cost. Given the current situation of the
market, the high income group also searches for good bargains. Therefore, the focus of
this showroom will be to present good quality furniture at an economical price range.
5.4 MARKET ENTRY TIME
Though the demand for wooden furniture in domestic market exists throughout the year
(especially for office furniture & renovation requirements), but it significantly increases
during the period of October to March because of the wedding season. The demand for
the furniture almost gets doubled during this period. The prime time to enter into market
would be June so that the Showroom gets into commercial operations before the start of
the wedding season.
5.5 PROPOSED BUSINESS LEGAL STATUS
The said project can be established as a sole proprietorship or a partnership and it can
also be registered under the Companies Ordinance, 1984 with the Securities & Exchange
Commission of Pakistan. The selection totally depends upon the choice of the
entrepreneur. This pre-feasibility assumes the legal status to be sole proprietorship as this
does not involve heavy investment. Moreover less legal requirements and costs are
involved in forming and running a sole proprietorship or partnership business. Lower tax
rates for this type of business legal status is an added advantage.
5.6 PROJECT CAPACITY AND RATIONALE
The proposed project is capable of selling a complete range of wooden furniture to meet
the demands of the domestic market. The furniture is purchased from local
manufacturers. The show room will work 11 hours a day for 300 days in a year.
5.7 PROPOSED LOCATION
The said project can be started in any central area of developed cities like Lahore,
Karachi, Islamabad, Sialkot or Faisalabad etc. It is however assumed that this showroom
is established at Lahore – Main Boulevard DHA. Most successfully running furniture
shops are located in areas like Gulberg, Cavalry, Cantt Fortress, Main Boulevard DHA,
Allama Iqbal town, Township, Ferozpur road, Multan road and Bedian road. The demand

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in these areas is influenced by the number of new houses/offices built and old
houses/offices renovated/reconstructed.
5.8 PROJECT INVESTMENT
Total Initial Cost of the Project is worked out as follows:

Table 5-1 Project cost

Rupees
Capital Investment Requirement 1,523,000
Working Capital Requirements 4,048,836
Total Project Investment Requirement 5,571,836
The proposed pre-feasibility is based on the assumption of 50% debt and 50% equity.
However, this composition of debt and equity can be changed as per the requirement of
the investor.

Table 5-2 Project financing

Rupees
Debt 50% 2,785,918
Equity 50% 2,785,918
Total Project Investment 5,571,836

Table 5-3 Project returns

IRR 29 %
NPV @ 20 % Rs. 2,121,943
Pay Back Period 3.78 years

6 INDUSTRY STRUCTURE
Total world trade in furniture is estimated to be around $23.2 billion, of which the share
of wooden furniture is 77 percent, followed by metal furniture at 17 percent and plastic
furniture at 6 percent. Italy is the world’s biggest exporter of furniture followed by
Germany and Canada. Pakistan’s share in the international wooden furniture market is
insignificant, despite the fact that the country has a history of craftsmanship and
innovation in the field of wooden furniture. The wooden furniture industry represents 95
percent of the total market in the country. The leading furniture making areas of Pakistan
are Chiniot, Gujrat, Peshawar, Lahore and Karachi. In terms of exports, Karachi comes
first, followed by Lahore and Peshawar.1

1
The Express Tribune (http://tribune.com.pk/story/19304/prospects-and-fears-for-pakistans-furniture-
industry/)

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6.1 FURNITURE CLUSTERS IN PAKISTAN

6.1.1 Gujrat2
Furniture industry developed gradually at its own and a number of showrooms were set
up on G.T Road, and Gujrat. The estimated overall furniture sale from Gujrat is about Rs.
500 million per annum. Furniture cluster of Gujrat is famous for the production of quality
wooden furniture. Gujrat was known for its furniture manufacturing even before the
independence because of the availability of cheap skilled labour. Presently most of the
manufacturers are depending on traditional method (labour intensive technology) that
results in the low productivity. There are about 300 units (including shops) in Gujarat
associated with this sector. The sector breakdown shows that majority of the sector is
based on 225 to 250 micro units, 40 to 50 small units and 5 medium sized units. There are
approximately 7,000 to 8,000 people directly employed in this industry. Gujarat is well
known for its top quality furniture all over Pakistan. A few units are exporting furniture
to different countries including, UK, USA, Saudi Arabia, Middle East etc. The total
export of Furniture from Gujarat was about US$ 4.5 million.3 However, due to limited
production capacity these firms are not able to fulfil the large export orders and hence can
not compete vigorously in international markets. China and India are the major
competitors. Their prices are less and quality is better.
6.1.2 Lahore4
The Lahore cluster is essentially based on the traders of wooden furniture. There are
more than 1,500 retail shops trading in Medium Density Fibreboard (MDF) furniture,
office, bedroom and living room furniture. However, in the last decade this market has
diversified its product range to all kinds of furniture articles. These traders usually
purchase furniture in semi-finished form from Chiniot and polish and upholster it in their
workshops. However, there are around 100-200 small cottage sized workshops in Lahore
are engaged in wooden furniture manufacturing. Their profit margins are quite high as all
the value addition is done in Lahore according to the requirement of the customers.
Majority of these manufacturing units use low-tech machinery which are either locally
made or are second hand imported machines. However, some furniture manufacturers
have established a production line based on new modern machinery and seasoning kiln
facilities. On average each manufacturing facilities employs 5 to 20 workers depending
on its scope of work.
At present there are around five large clusters of furniture markets within Lahore i.e.
Fortress Stadium, Gulberg, Allama Iqbal Town, Ferozepur Road and Multan Road. These
markets mostly cater to the needs of the domestic market.
6.1.3 Chiniot5
Although Chiniot wooden furniture industry is approximately 150 to 200 years old, but
still remained at cottage sized scale. There are almost 3,000 to 4,000 manufacturing units
in Chiniot, which use primitive technology and techniques for manufacturing. Around
2
http://www.smeda.org/downloads/Cluster_Profile_Furniture_Gujrat.pdf
3
Directorate of Industries
4
Furniture blog (http://furniturekingdom.blogspot.com/)
5
Furniture blog (http://furniturekingdom.blogspot.com/)

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40,000 people are directly employed by this industry. The demand for this kind of
furniture is increasing in the international market.
Chiniot is a major cluster engaged in the manufacturing of handmade wooden carved
furniture. The basic raw material used for hand carved furniture is Sheesham wood,
which is under an attack of an unknown kind of disease. This has resulted in a shortage of
raw material and increase in its price.
The stakeholders can be categorized into manufacturers, craftsmen, traders, timber
merchants, exporters, transporters and financial institutions. The number of skilled
craftsmen is declining, which is creating severe shortage in the industry. The semi-
finished items (Kora) are sold to all major cities throughout Pakistan.

7 WORLD IMPORTS AND EXPORTS6

Total world trade in furniture is estimated to be around $23.2 billion, of which the share
of wooden furniture is 77 percent, followed by metal furniture at 17 percent and plastic
furniture at 6 percent. Italy is the world’s biggest exporter of furniture followed by
Germany and Canada. United States is the biggest importer of wooden furniture followed
by Germany and France. Pakistan’s share in the international wooden furniture market is
insignificant, despite the fact that the country has a history of craftsmanship and
innovation in the field of wooden furniture.
In terms of exports, Karachi comes first, followed by Lahore and Peshawar. Exporters are
suffering manifold problems while local manufacturers are facing challenges due to
heavy imports of furniture. Chinese furniture has also hit the local industry by 70 percent
and the sales of locally manufactured household furniture have gone down by 30 percent.
Pressure on the domestic industry has immensely increased as other countries like
Thailand and Korea have started exporting extensively to Pakistan.
At the same time, the high cost of the furniture business has threatened the sector as a
whole. The prices of all raw materials used in making furniture which include chipboard,
timber, foam, polish chemical materials, colour paints and hard ware have increased.
Timber production on the other hand has gone down drastically because of unchecked
deforestation.
As a result, imported chipboard is used in manufacturing bedroom sets, which sell the
most. About sixty percent raw material used in furniture making is imported from China.
Imported item mostly used in furniture making are chipboard, hardware items and glass.
Pakistan’s major buyers of wooden furniture are the UK, the USA, Sri Lanka and Gulf
countries like the UAE, Saudi Arabia, Oman and Kuwait. The United States buys mostly
bedroom furniture. UK and the Gulf countries import kitchen furniture and office
furniture. For example, the British retail chain Harrods sells some Pakistani furniture at
its outlets.
The foreign sources of furniture in Pakistan are China, Germany and Italy; however, they
have not yet succeeded in taking over the local market’s share of heavy furniture. The

6
The Express Tribune - http://tribune.com.pk/story/19304/prospects-and-fears-for-pakistans-furniture-
industry/

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quality of local heavy furniture is higher and the price is comparatively lesser. Customs,
freight charges are being charged according to the weight and volume of an item,
therefore, imported furniture items cost much higher particularly in case of heavy
furniture. However, the imported items which fall in the light furniture category have
dominated the market which has impaired the local industry by almost 80 per cent.
An attempt on deco furniture and by using MDF chip board and fibre glass approach, the
domestic suppliers have been able to attract the consumers again to the local markets.
Using this approach the manufacturers have created decent designs and carvings on the
bedroom sets and an excellent indigenous bedroom set is now available in Rs.175,000.

Table 7-1 Pakistan’s Import and Export figures

Period Import Value Export Value
2009 $12,951,770 $6,886,417
2008 $11,210,886 $8,162,790
2007 $16,721,587 $10,526,255
2006 $14,851,839 $10,144,781
2005 $10,282,913 $12,441,062

8 MARKET INFORMATION ABOUT FURNITURE

At present there are around five large clusters of furniture markets in Lahore and these
markets mostly cater to the needs of the domestic market.
8.1 REQUIREMENT OF WOODEN FURNITURE
In local market, the requirement for wooden furniture can be categorized into four types
namely:
a. For newly built house;
b. For dowry;
c. For renovation;
d. For Institutional buyer.
Customers from the first category usually buy range of products like bed sets, dining sets
and sofa sets with other required furniture for their entire house. In Pakistani society,
furniture is given as dowry. Therefore, its demand increases in the spring and winter
season when most weddings take place. Basic requirement of these customers is a
bedroom set of new designs and styles. These types of customers also buy sofa set or
dining set. The renovation and improvement requirements also provide a considerable
market. Initially, the entrepreneur should target these customers to establish the business
and to increase the customer base later on. These potential customers can play a major
role in the success this business. The hotel industry provides considerable scope for
wooden furniture. Large orders can be secured to supply furniture to hotels and resorts.
However, given the current political and economical situation of Pakistan the corporate
sector does not provide much opportunity for furniture business.

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9 PROJECT MARKETING STRATEGY

9.1 MARKETING STRATEGY
When marketing for furniture we could use print media such as newspaper and fashion or
interior decoration magazines. Internet marketing can also be used.
In addition, sales promotion must be done in order to develop new customers and keep in
touch with current customers. For example through a newsletter (by e-mail) one can
make the customers aware that the showroom is following the latest interior decoration
trends and latest developments are taking place in quality standards and newer styles and
fashion. Additionally, a constant, prompt and reliable communication is vital to build and
maintain a long-term business relationship with your customers. To establish a brand
name high quality standards must be maintained along with good customer service.
9.2 TRENDS IN FURNITURE STYLE
In all furniture styles some significant trends are:
• Individual items of furniture can be used for different functions: flexible seating for
sitting, reclining or sleeping; modular wall systems and living room systems.
• Furniture for older people with a focus on comfort (e.g. higher seats).
• Part of the trend of making more use of the home space is to extend the home into the
garden or onto a patio or veranda.
• Many households are full of furniture, so rather than overloading their homes,
consumers are looking for something with a simple elegance to achieve “less is
more”.
• Combined with this simple functionality, consumers want aesthetically pleasing
designs. For example, LED illumination to enhance simple cabinet, invisible
loudspeakers in internal doors, new coverings on handles that feel good to touch, flat
screen TVs which almost disappear into surroundings when not being used.
• Small visible legs, made of metal or wood, are an important feature at the moment for
living room chairs, couches, armchairs and cupboards and small tables.
9.3 TRENDS IN MATERIALS, COLOURS AND SHAPES
Home furniture and furnishings are becoming more colourful. The colours used in
upholstery furniture fabrics, and cupboard and cabinet fronts are loud and bold. The
design and form in upholstered furniture remains voluminous. As far as materials are
concerned, there is a decrease in the use of cherry in new lines. However, cherry, along
with oak and walnut, are key materials for products at the high end market.
The vogue is still very much for the dark, exotic look with oak and other wood species
presented in a number of guises, striped effect to emulate zebrano, heavily lacquered and
most popular of all, stained dark, almost black. Modern technology is enhancing pieces
with improved finishes and high-tech options.

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9.3.1 Materials commonly used

• Woods: Interior parts and primary and secondary frames of most items are made
from lower quality wood like birch, ply and laminates, while for exposed surfaces
fine timbers are used. Lighter hard woods such as oak, beech, maple, alder, birch,
cherry and hickory have proved more popular than pine.
• Rattan: Fine wickerwork, bamboo, hemp, abaca and sea grass continue to be
important materials, which are increasingly used in natural interiors.
• Metals: The metallic, hi-tech or industrial look is popular in furniture, being an eye
catching element. Metals in simple forms are often combined with wood or glass.
Stainless steel, chrome, wrought iron, aluminium and copper have become popular in
the past few years.
• Glass: Smoked glass and other opaque finishes, rather than clear (cold) glass is
popular. Natural and acrylic glass is increasingly used in combination with other
materials in tables, cabinets etc.
• New materials: Experiments are done with new materials: polycarbonates in matt
finish, high gloss, transparent and in many colours. Also, recycled polyester is
increasingly being used in modern items.
• Fabrics: These are softer in texture and appearance, with single light natural colours
used as a basis. Small motifs, textured look; geometric or large colourful designs are
also in fashion. Floral designs, micro-fibres are still common and (soft) hi-tech fibres
are gaining importance.
• Finishes: There is a trend towards high gloss finish in many colours for tables and
chests. There is also much use of polished, laminates, satin-finish, acid-etched,
painted glass with neutral or bright colours; opaque lacquers; painted and enamelled
steel; anodized, polished and mat aluminium.

10 PROPOSED PRODUCT MIX

This unit is proposed to sell different types of wooden furniture. As this project is
catering to the needs of the domestic market, it is assumed that the project will be selling
the product mix given in the table below. Each product mix can be manufactured in three
different qualities of wood depending on the customer’s budget and requirement. The
project assumes that 30% of the total sales is of Quality A products, Quality A being the
most superior quality, 40% sales will be of Quality B products, this being the fine quality
and 30% sales will be of Quality C products, Quality C being of normal quality.
The projected sales given below are only an approximation. The sales in actuality vary
greatly and can not be predicted in advance. Bedroom and common room furniture is the
largest segment as far as the domestic market is concerned.

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Table 10-1 Product Mix

Total
1. Bed Room Set Projected
Sales
For Bachelors Single bed, side table, one dressing table, 50
two chairs & one stool.
For Married couples Double bed, two side tables, one dressing 100
table, double seater sofa, one TV Cabinet &
one stool.
2. Dinning Room
6 Seater Dinning table and chairs with trolley 50
8 Seater Dinning table and chairs with trolley 50
3. Common Room One TV Trolley, one three seater sofa and 75
two single seater sofas, one wooden
partition and a central table.
4. Drawing Room One three seater, two single seater and one 50
double seater sofa, one central table, one
decorative sofa.
5. Office furniture
Executive One executive table, one revolving chair, 50
two chairs, one computer table and one 2
seater sofa.
General One table including computer cabinet, one 100
revolving chair and two other chairs

11 HUMAN RESOURCE REQUIREMENT

11.1 Human Resource Requirements

Following table shows the requirements of Human Resources and the proposed annual
salary.

Table 11-1 Human Resource detail

Salary / Month Annual Salary
Description Employees
(Rs.) (Rs.)
ADMINISTRATIVE COST
Store Manager 1 35,000 420,000
Store Supervisor 1 28,000 336,000
Workshop Labour 2 10,000 240,000
Office boy 1 7,000 84,000
Guard 2 8,500 204,000
Total Administrative Salaries 1,284,000

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MARKETING COST
Indoor Sales person 3 15,000 540,000
Outdoor Sales person 2 20,000 480,000
Total Marketing Salaries 1,020,000

12 OFFICE EQUIPMENT
Following tables present the office equipment and furniture/fixtures requirement for the
showroom.

Table 12-1 Office Equipment

Items No. of Cost per Unit Total Cost
Items Rupees Rupees
Computers 1 25,000 25,000
Printers 1 12,500 12,500
Fax Machine 1 10,000 10,000
Telephone Sets 2 1,000 2,000
Fire Fighting Equipments 4 4,500 18,000
TOTAL 67,500

Table 12-2 Furniture, Fixture & Fittings

Cost Total Cost
Items
Rupees Rupees
Office Furniture (tables, chairs, cabinets, etc.) 166,000 166,000

Table 12-3 Other Equipment

Cost per Unit Total Cost
Items Qty
Rupees Rupees
Air Conditioners / Split Units 1 40,000 40,000
Generator 1 150,000 150,000
Electric Installations & Fittings - 150,000 150,000
cables & wires
Fancy Lights 50 500 25,000
Ceiling fans 5 2,500 12,500
Other decoration expenses - sign 150,000 150,000
Board, antiques, wall paintings etc.
TOTAL 527,500

13 LAND & BUILDING REQUIREMENT

An already built showroom can be rented for the proposed business in any commercial
area or it can be purchased based on the judgment of the entrepreneur. It is however
recommended to rent the space. The rent in this feasibility is taken to be about Rs.

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112,500/- per month. The total area requirement for this proposed project is assumed to
be of approximately 1 kanal.

Table 13-1 Space Requirement

Space Required. (Sq. ft)
Display Hall 4,000
Workshop/Store room 220
Management Office 200
Kitchen 50
Washrooms 30
Total Infrastructure Cost 4,500

14 KEY ASSUMPTIONS
14.1 Project Assumptions
Projected Life of The Project in Years 10
Sponsors' Equity 50%
Debt Financing 50%
Long term Interest rate 16%
Short term Interest rate 14%
Debt Tenure in Years 5
Interest on cash in bank 10%
Tax rate7 25%
Insurance expense 5%
14.2 Operating Assumptions
Total No. of Months operational in one year 12
No of Working Days per year 300
Hours operational in a day 11
14.3 Depreciation Rate Assumptions
Land 0% of the Written Down Value
Buildings 5% of the Written Down Value
Tools and Equipment 10% of the Written Down Value
Office Equipment 33% of the Written Down Value
Furniture & Fixtures 10% of the Written Down Value
Vehicles 20% of the Written Down Value
14.4 Cash Flow Assumptions
Furniture Inventory 30 days
Stores and Spares 30 days

7
Tax rate is fixed through out the project since the income falls in 25% tax deduction slab

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Accounts Payable 30 days

14.5 Miscellaneous Assumptions
Inflation rate 10%
Electricity growth rate 10%
Water price growth rate 10%
Gas price growth rate 10%
Wage growth rate 10%
Office equipment price growth rate 10%
Office vehicles price growth rate 10%
14.6 Expense Assumptions
Cost price growth rate 5%
Freight and carriage charges 5% % of furniture cost
Freight charges growth rate 5%
Staff benefits expense 10% % of administration
Staff benefits expense growth rate 5%
Travelling expense 10% % of administration
Communication expense growth 5%
Office expenses 12% % of administration
Promotional expense 2% % of revenue
Promotional expense growth rate 5%
Machinery & equipment insurance rate 5% 1st year onwards
Professional fees (legal, audit, consultants, etc.) 0.5% % of revenue
14.7 Revenue Assumptions
Profit Margin8 25%
Sales growth rate 5%
Sales price growth rate 5%
14.8 Revenue Assumptions - Product Mix
PROJECTED SALES YEAR - 1
Total sales Quality A Quality B Quality C
30% 40% 30%
Bedroom set
For Bachelors 50 15 20 15
For married couples 100 30 40 30
Dining room
6 seater 50 15 20 15

8
The profit margin in the Furniture business can be as high as 100% or even more. The profit margin is
taken to be 25% of cost price in this particular pre-feasibility; however it depends upon the owner’s
discretion.

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8 seater 50 15 20 15
Common room 75 23 30 23
Drawing room 50 15 20 15
Office furniture
Executive 50 15 20 15
General 100 30 40 30
14.9 Revenue Assumptions - Sales price
SALES PRICE - YEAR WISE YEAR - 1
Quality A Quality B Quality C
Bedroom set
For Bachelors 60,000 45,000 35,000
For married couples 90,000 70,000 50,000
Dining room
6 seater 60,000 50,000 40,000
8 seater 75,000 65,000 57,500
Common room 100,000 85,000 75,000
Drawing room 100,000 90,000 80,000
Office furniture
Executive 50,000 40,000 35,000
General 30,000 25,000 18,000
14.10 Cost of Sales
COST PRICE - YEAR WISE YEAR - 1
Quality A Quality B Quality C
Bedroom set
For Bachelors 45,000 33,750 26,250
For married couples 67,500 52,500 37,500
Dining room
6 seater 45,000 37,500 30,000
8 seater 56,250 48,750 43,125
Common room 75,000 63,750 56,250
Drawing room 75,000 67,500 60,000
Office furniture
Executive 37,500 30,000 26,250
General 22,500 18,750 13,500

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15 FINANCIAL STATEMENTS
15.1 Project Cost

Initial Investment
Capital Investment Rs. in actuals
Land -
Building/Infrastructure -
Tools & equipment 100,000
Furniture & fixtures 693,500
Office vehicles -
Office equipment 67,500
Pre-operating costs 612,000
Legal, Licensing, and Training costs 50,000
Total Capital Costs 1,523,000
Working Capital Rs. in actuals
Stocks and spares inventory 45,923
Furniture Inventory 2,296,125
Frieght and carriage expense 26,788
Upfront building rental 675,000
Upfront insurance payment 5,000
Cash 1,000,000
Total Working Capital 4,048,836

Total Investment 5,571,836

Initial Financing Rs. in actuals
Debt 50% 2,785,918
Equity 50% 2,785,918
Project Returns
EQUITY PROJECT
Net Present Value 1,362,071 2,121,943
Internal Rate of Return 34% 29%
Payback Period (Yrs) 3.90 3.78

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15.2 Income Statement

Income Statement
Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
Revenue 30,615,000 33,753,038 37,212,724 40,969,595 45,168,979 49,798,799 54,903,176 60,530,752 66,735,154 73,575,507
Cost of sales
Cost of furniture 22,961,250 25,314,778 27,909,543 30,727,197 33,876,734 37,349,099 41,177,382 45,398,064 50,051,365 55,181,630
Freight and carriage 1,148,063 1,265,739 1,395,477 1,536,360 1,693,837 1,867,455 2,058,869 2,269,903 2,502,568 2,759,082
Stocks and spares 459,225 506,296 558,191 614,544 677,535 746,982 823,548 907,961 1,001,027 1,103,633
Total cost of sales 24,568,538 27,086,813 29,863,211 32,878,100 36,248,106 39,963,536 44,059,799 48,575,928 53,554,961 59,044,344
Gross Profit 6,046,463 6,666,225 7,349,513 8,091,495 8,920,873 9,835,263 10,843,377 11,954,823 13,180,193 14,531,163

General administration & selling expenses

Administrative salaries 1,284,000 1,412,400 1,553,640 1,709,004 1,879,904 2,067,895 2,274,684 2,502,153 2,752,368 3,027,605
Administration benefits expense 128,400 141,240 155,364 170,900 187,990 206,789 227,468 250,215 275,237 302,760
Marketing staff salaries 1,020,000 1,122,000 1,234,200 1,357,620 1,493,382 1,642,720 1,806,992 1,987,691 2,186,461 2,405,107
Marketing staff benefits 102,000 112,200 123,420 135,762 149,338 164,272 180,699 198,769 218,646 240,511
Building rental expense 1,350,000 1,485,000 1,633,500 1,796,850 1,976,535 2,174,189 2,391,607 2,630,768 2,893,845 3,183,229
Deisel expense 216,000 237,600 261,360 287,496 316,246 347,870 382,657 420,923 463,015 509,317
Electricity expense 291,339 320,473 352,520 387,772 426,550 469,205 516,125 567,738 624,511 686,963
Travelling expense 128,400 141,240 155,364 170,900 187,990 206,789 227,468 250,215 275,237 302,760
Communications expense (phone, fax, mail, internet, etc.) 120,000 126,000 132,300 138,915 145,861 153,154 160,811 168,852 177,295 186,159
Office expenses (stationary, entertainment, janitorial etc.) 154,080 169,488 186,437 205,080 225,589 248,147 272,962 300,258 330,284 363,313
Promotional expense 870,000 565,500 113,100 118,755 124,693 130,927 137,474 144,347 151,565 159,143
Insurance expense (Machinery/tools and vehicle) 5,000 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500
Professional fees (legal, audit, consultants, etc.) 153,075 168,765 186,064 204,848 225,845 248,994 274,516 302,654 333,676 367,878
Depreciation expense 101,850 101,850 101,850 109,298 109,298 109,298 119,210 119,210 119,210 132,404
Amortization of pre-operating costs 122,400 122,400 122,400 122,400 122,400 - - - - -
Amortization of legal, licensing, and training costs 10,000 10,000 10,000 10,000 10,000 - - - - -
Subtotal 6,056,544 6,240,656 6,325,519 6,929,101 7,584,620 8,172,749 8,974,676 9,845,294 10,802,349 11,867,648
Operating Income (10,082) 425,569 1,023,994 1,162,394 1,336,253 1,662,513 1,868,702 2,109,529 2,377,844 2,663,514

Other income (interest on cash) 170,325 210,870 283,756 388,249 515,430 672,941 868,374 1,099,996 1,365,150 1,986,809
Gain / (loss) on sale of office equipment - - 40,500 - - 74,156 - - 108,826 127,329
Gain / (loss) on sale of office vehicles - - - - - - - - - -
Earnings Before Interest & Taxes 160,244 636,438 1,348,250 1,550,643 1,851,683 2,409,610 2,737,076 3,209,525 3,851,819 4,777,652

Interest expense on long term debt (Project Loan) 121,840 104,123 83,572 59,732 32,079 - - - - -
Interest expense on long term debt (Working Capital Loan) 156,782 - - - - - - - - -
Subtotal 278,622 104,123 83,572 59,732 32,079 - - - - -
Earnings Before Tax (118,378) 532,315 1,264,678 1,490,911 1,819,604 2,409,610 2,737,076 3,209,525 3,851,819 4,777,652

Tax - 66,539 265,582 372,728 454,901 602,402 684,269 802,381 962,955 1,194,413
NET PROFIT/(LOSS) AFTER TAX (118,378) 465,776 999,096 1,118,183 1,364,703 1,807,207 2,052,807 2,407,144 2,888,865 3,583,239

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15.3 Balance Sheet

Balance Sheet
Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
Assets
Current assets
Cash & Bank 1,562,500 1,844,005 2,373,391 3,301,726 4,463,259 5,845,337 7,613,477 9,754,010 12,245,907 15,057,091 24,679,082
Stocks and spares inventory 45,923 50,630 55,819 61,454 67,753 74,698 82,355 90,796 100,103 110,363 -
Furniture inventory 2,296,125 2,531,478 2,790,954 3,072,720 3,387,673 3,734,910 4,117,738 4,539,806 5,005,137 5,518,163 -
Freight and carriage rental 26,788 29,534 32,561 35,848 39,523 43,574 48,040 52,964 58,393 64,379 -
Prepaid rental expense 112,500 123,750 136,125 149,738 164,711 181,182 199,301 219,231 241,154 265,269 -
Pre-paid insurance 5,000 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 -
Total Current Assets 4,048,836 4,583,896 5,392,850 6,624,986 8,125,920 9,882,202 12,062,911 14,658,307 17,651,693 21,015,765 24,679,082
Fixed assets
Furniture & fixtures 693,500 624,150 554,800 485,450 416,100 346,750 277,400 208,050 138,700 69,350 -
Office equipment 67,500 45,000 22,500 89,843 59,895 29,948 119,580 79,720 39,860 159,161 106,108
Total Fixed Assets 861,000 759,150 657,300 645,293 535,995 426,698 436,980 317,770 198,560 238,511 106,108
Intangible assets
Pre-operation costs 612,000 489,600 367,200 244,800 122,400 - - - - - -
Legal, licensing, & training costs 50,000 40,000 30,000 20,000 10,000 - - - - - -
Total Intangible Assets 662,000 529,600 397,200 264,800 132,400 - - - - - -
TOTAL ASSETS 5,571,836 5,872,646 6,447,350 7,535,078 8,794,315 10,308,899 12,499,892 14,976,078 17,850,253 21,254,277 24,785,190

Liabilities & Shareholders' Equity

Current liabilities
Accounts payable 2,554,336 2,816,155 3,104,372 3,418,262 3,768,634 4,154,919 4,580,798 5,050,330 5,567,989 5,518,163
Total Current Liabilities - 2,554,336 2,816,155 3,104,372 3,418,262 3,768,634 4,154,919 4,580,798 5,050,330 5,567,989 5,518,163
Other liabilities
Deferred tax - (24,445) (75,032) (75,032) (75,032) (77,532) (80,032) (82,532) (85,032) (87,532)
Long term debt (Project Loan) 761,500 650,771 522,325 373,328 200,491 - - - - - -
Long term debt (Working Capital Loan) 2,024,418 - - - - - - - - - -
Total Long Term Liabilities 2,785,918 650,771 497,880 298,296 125,459 (75,032) (77,532) (80,032) (82,532) (85,032) (87,532)

Shareholders' equity
Paid-up capital 2,785,918 2,785,918 2,785,918 2,785,918 2,785,918 2,785,918 2,785,918 2,785,918 2,785,918 2,785,918 2,785,918
Retained earnings (118,378) 347,397 1,346,493 2,464,676 3,829,379 5,636,586 7,689,393 10,096,537 12,985,402 16,568,641
Total Equity 2,785,918 2,667,539 3,133,315 4,132,411 5,250,594 6,615,297 8,422,504 10,475,311 12,882,455 15,771,319 19,354,559
TOTAL CAPITAL AND LIABILITIES 5,571,836 5,872,646 6,447,350 7,535,078 8,794,315 10,308,899 12,499,892 14,976,078 17,850,253 21,254,277 24,785,190

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15.4 Cash Flow Statement

Cash Flow Statement
Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
Operating activities
Net profit (118,378) 465,776 999,096 1,118,183 1,364,703 1,807,207 2,052,807 2,407,144 2,888,865 3,583,239
Add: depreciation expense 101,850 101,850 101,850 109,298 109,298 109,298 119,210 119,210 119,210 132,404
amortization of pre-operating costs 122,400 122,400 122,400 122,400 122,400 - - - - -
amortization of training costs 10,000 10,000 10,000 10,000 10,000 - - - - -
Deferred income tax - (24,445) (50,587) - - (2,500) (2,500) (2,500) (2,500) (2,500)
Equipment inventory (45,923) (4,707) (5,190) (5,635) (6,299) (6,945) (7,657) (8,441) (9,307) (10,261) 110,363
Furniture inventory (2,296,125) (235,353) (259,476) (281,765) (314,954) (347,237) (382,828) (422,068) (465,330) (513,026) 5,518,163
Freight and carriage rental (26,788) (2,746) (3,027) (3,287) (3,674) (4,051) (4,466) (4,924) (5,429) (5,985) 64,379
Prepaid building rent (112,500) (11,250) (12,375) (13,613) (14,974) (16,471) (18,118) (19,930) (21,923) (24,115) 265,269
Advance insurance premium (5,000) 500 500 500 500 500 500 500 500 500 500
Accounts payable 2,554,336 261,819 288,217 313,891 350,372 386,285 425,879 469,532 517,659 (49,826)
Cash provided by operations (2,486,336) 2,416,652 657,832 1,167,175 1,334,370 1,582,569 1,887,720 2,140,533 2,491,897 2,970,346 9,621,991

Financing activities
Project Loan - principal repayment (110,729) (128,446) (148,997) (172,837) (200,491) - - - - -
Working Capital Loan - principal repayment (2,024,418) - - - - - - - - -
Short term debt principal repayment - - - - - - - - - -
Additions to Project Loan 761,500 - - - - - - - - - -
Additions to Working Capital Loan 2,024,418 - - - - - - - - - -
Issuance of shares 2,785,918 - - - - - - - - - -
Cash provided by / (used for) financing activities 5,571,836 (2,135,147) (128,446) (148,997) (172,837) (200,491) - - - - -

Investing activities
Capital expenditure (1,523,000) - - (89,843) - - (119,580) - - (159,161) -
Acquisitions
Cash (used for) / provided by investing activities (1,523,000) - - (89,843) - - (119,580) - - (159,161) -
NET CASH 1,562,500 281,505 529,386 928,335 1,161,533 1,382,078 1,768,140 2,140,533 2,491,897 2,811,184 9,621,991

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16 ANNEXURE
16.1 Major Furniture Suppliers and Manufacturers
Name Location
M/s Trend Line Furnishers Gujrat
G.T. Road
Contact: 053-3517120
National Furnishers Gujrat
G.T. Road
Contact: 053-3514967
GEO Furnishers Gujrat
G.T. Road
Contact: 053-3515186
Highlite Furniture Chiniot
Contact: 0476-335090
Chiniot Art Furniture Chiniot
Katchery Road
Contact: 0300-77009201
Galaxy Furniture Chiniot
Contact: 0476-332213

16.2 Tax Deduction income slabs

Income Slabs Tax Rate
0.00%
100,000 – 110,000 0.50%
110,000 – 125,000 1.00%
125,000 – 150,000 2.00%
150,000 – 175,000 3.00%
175,000 – 200,000 4.00%
200,000 – 300,000 5.00%
300,000 – 400,000 7.50%
400,000 – 500,000 10.00%
500,000 – 600,000 12.50%
600,000 – 800,000 15.00%
800,000 – 1,000,000 17.50%
1,000,000 – 1,300,000 21.00%
1,300,000 and above 25.00%

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