COFFEE HOUSE
SERVICE CAPACITY (Value)
: Rs. 30,00,000/-
MONTH AND YEAR
OF PREPARATION
: July, 2014
PREPARED BY
: Dr. Amarnath
Assistant Director (Metallurgy)
1. INTRODUCTION
The specialty- coffee business is growing at a healthy pace During past years
there has not been a single year, despite recession, in which specialty coffee sales
have not grown. In many years the increase has been in double digits. In addition,
no coffee house chains in Delhi have failed during decades, although the list of
causalities in other industries is quite long.
2. MARKET POTENTIAL
Coffee house bar is determined to become a daily necessity for local coffee
addicts, a place to dream as you try to escape of life and just a comfortable place to
meet your friends or to read a books, express your talent on live platform, all in one.
With growing demand for high-quality gourmet coffee and great service in
proximity of academic institutions and commercial locations, the business may
flourish to any extent if served well. The service unit may include dessert bar,
pastries complimented with books and space for live performance in academic area
to add value for service.
3. BASIS AND PRESUMPTIONS
This project is made on the basis of the following presumptions:
i.
ii.
iii.
iv.
It is assumed that the unit will be viable at 75% efficiency on single shift basis
considering 5 working days or as per demand of area per week.
The rate of interest in the scheme is taken at 11.5 % for both fixed and
working capital. Due to liberalization and competition among banks, lower
rate of interest is possible in future.
The prices of machinery and equipments are approximate which are ruling
locally at the time of preparation of the project. When a tailor-cut project is
prepared the necessary changes are to be made at the local level.
The cost of staff and labor is approximate which is ruling locally at the time
of preparation of the profile. When a tailor-cut project is prepared the
necessary changes are to be made.
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Coffee House
4. IMPLEMENTATION SCHEDULE
The project can be implemented in a period of 3 to 6 months by performing
the various activities in a systematic manner and simultaneous application of
various common activities as mentioned below:
Preparation of project reports
1st month
Essential registration if required
1st month
Selection of site
1st to 2nd month
Arrangement of finance/loans
3rd to 4th month
Arrangement of rented accommodation
1st to 2nd month
Machinery & equipment procurement
3rd to 5th month
Recruitment of staff & labour
5th month
Installation of machinery
5th month
Trial presentation to the customers
5th to 6th month
Commercial Design and sales of product
6th month
5. TECHNICAL ASPECTS
5.1. Process Outline
The coffee house business is a labour intensive and need a highly talented
work force with good manners to serve business. Hence fully qualified professionals
will be hired.
5.2. Service Capacity
Estimated revenue earned per year: Rs. 30,00,000/-
5.3. Motive Power
Total requirement is about 2 HP.
5.4. Pollution Control
Good housekeeping will be maintained to avoid pollution in and around area.
5.5. Energy Conservation
Best use of electrical appliances will be assured for use of optimum energy in
the servicing unit.
6. FINANCIAL ASPECT
6.1. Fixed Capital
Land & Building:
Well-equipped office space in commercial area 2,300 ft2 @ Rs.20 per ft2.
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Coffee House
6.1.1. Machinery and Equipments
S. N.
Description of Machine
Quantity
Amount (Rs)
1.
Espresso Machine
20,000
2.
Coffee maker
5,000
3.
Coffee Grinder
1,000
4.
Food service equipments (toasters, blender,
Microwave, dishwasher, refrigerator, etc.
LS
60,000
5.
Storage hardware( bins, utensil rack, shelves,
food case)
LS
15,000
6.
Counter area equipment
(Counter top, sink, ice machine, etc.)
LS
25,000
7.
Serving area equipment
(Plate, glasses, flatware, etc.)
LS
10,000
8.
Store equipment
(Security, ventilation, signage, etc.)
LS
25,000
9.
Office equipments (PC, fax/printer, furniture,
file cabinets cash register, etc.)
LS
75,000
10.
Electrification and installation @ 15% of above
35,400
Total
Preoperative expenses like legal, establishment, traveling,
Startup consultancy, telephone, electricity connections, etc.
2,71,400
Rs. 25,000
Total Fixed Capital
Rs. 2,96,400/-
6.2. Working Capital (per month)
6.2.1. Personnel
S.No. Designation
Nos.
Salary (Rs.)
Total (Rs.)
1.
Self as CEO/Manager
15,000
15,000
2.
Skilled workers
12,000
36,000
3.
Sales Promotion Executive
10,000
10,000
4.
Peon cum Helper
7,500
15,000
76,000
11,400
87,400
Total
Add perquisites etc. @ 15%
Total
6.2.2. Utilities
1. Power: 240 units @ Rs. 6.50/unit
2. Water: LS
Total
Rs. 1,560
Rs. 140
Rs. 1,700
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Coffee House
6.2.3. Other Contingent Expenses
S. No.
1
2
3
4
5
6
7
Description
Rent
Stationery, Postage, etc.
Transportation
Telephone, Fax, etc.
Advertisement/publicity
Consumable stores
Miscellaneous Expenses
Value (Rs.)
46,000
1,500
2,500
2,500
1,000
2,500
1,000
Total
6.2.4. Total Recurring Expenditure (per month)
57,000
Rs. 1,46,100/-
6.3. Total Capital Investment
Fixed Capital
Working Capital (for 3 months)
Rs. 2,96,400
Rs. 4,38,300
Total
Rs. 7,34,700/-
7. FINANCIAL ANALYSIS
7.1. Cost of Operation (per annum)
S.No.
1.
2.
Description
Total Recurring Cost per year
Depreciation on Machinery & Equipment including
furniture @ 20%
Interest on Total Investment @ 11.5%
3.
Total
7.2. Turnover (per annum)
Revenue earned
Rs. 30,00,000/-
7.3. Net Profit (per annum)
=
Turnover Cost of Operation
Rs. 11,08,030/-
7.4. Net Profit Ratio
=
Net profit per year
X 100
Turnover per year
= 36.9 %
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Amount (Rs.)
17,53,200
54,280
84,490
18,91,970
Coffee House
7.5. Rate of Return
=
Net profit per year
X 100
Total Capital Investment
= 150.8 %
7.6. Break-even Point
Fixed Cost (Per Annum)
(Rs.)
Rent
5,52,000
Total Depreciation
54,280
Total Interest
84,490
40% of salary and wages
4,19,520
40% of other Contingent expenses
(Excluding rent)
52,800
Total
11,63,090
B.E.P
=
Fixed Cost
X 100
Fixed Cost + Net Profit
= 51.2 %
Addresses of Machinery and Equipment Suppliers:
All equipments for coffee making, Computers and other consumable stores will be
procured from the local suppliers.
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