Context

1) Introduction to SSI
2) Business Plan
3) Finance
4) Infrastructure
5) Manpower
6) Registration
7) Suppliers & Storage System
8) Raw Material
9) Production Process
10) Marketing
11) Distribution
12) Managing
13) Future Scope
Introduction to Small Scale Industries
The conventional definition of Small- Scale industry includes cottage
and handicraft industries, which employ traditional labor- intensive
methods to produce traditional products, largely in village households.
Small scale industries play a key role in the industrialization of
developing country. This is because they provide immediate large scale
employment and it also requires lower investments. SSI is the backbone
of the Indian Industrial structure.

This is a sector that has emerged victorious in the time of rising threats
from Large Scale industries within the nation and from multi- nationals
abroad. The development of small scale enterprises will create job in
rural areas of the developing countries where unemployment and
underemployment are high. In India the small Scale industries sector has
been growing faster than the whole of the manufacturing sector, at the
rate of 7% to 10%. SSI sector’s contribution to GDP is about 40%.
Today SSI units provide employment to over 27.1 million people.

Today the SSI sector contributes up to 40%to the manufacturing sector,

and 80%to the employment. This sector accounts for about 95% of the
industrial units. It contributes 40%to the country’s industrial production
and 34%of the exports. In the year 2004- 2005 there has been a growth
in the exports by 24%. The SSI units are supplementing and
complementary to the ancillary units.
Classification of Small- Scale industries:-

Small scale industries are mainly classified as traditional and modern

industries. Examples of traditional Small- Scale industries are khadi,
handlooms, coir industries, sericulture etc. Modern small industries
manufacture a wide variety of goods from simple items to sophisticated
items such as television sets, engineering products, etc, particularly as
ancillaries to large industries.

On the basis of the capital investment, in plant and machinery, industries

may be classified into tiny, small- scale, ancillaries, medium and large
industries as follows:-

CATEGORY LEVEL OF CAPITAL INVESTMENT

1. Tiny Upto Rs. 5lakhs

2. Small- Scale Between Rs, 5lakhs to Rs. 60 lakhs.
3. Ancillaries Between Rs. 61 lakhs to Rs. 75 lakhs
4. Medium Between Rs. 76 lakhs to Rs. 5crores
5. Large Above Rs. 5 crores.

GEE KAY ENGINEERS & TRADERS was setup in . The factory

1991 is setup in VITTHALWADI, ULASNAGAR. It is a Ancillary
industry with an initial investment of Rs.55 lakhs. It is a sole trading
concern. The factory manufactures spring & washer in bulk quantity and
is sold in bulk in various manufacturing industry like Prestige, Hawkins,
National Rayon Corporation (NRC). His production is spring
manufacturing and sheet metal pressing component for that a mild steel
sheet, spring steel wires of various sizes are required for various
product.
He entered into this sector because he wanted to establish a industrial
engineering product. The process require highly complicated machinery
which needs technically skilled labour.

Though there are many manufacturers of the same product, there is a

constant demand for the product. The market is still growing. Hence
there is a scope for growing in the industry.

Finance
GEE KAY ENGINEERS & TRADERS is a sole trading concern owned by
Mr.GRISH KRISHANA KUMAR. He started his business with the capital
of Rs. 55 lakhs in year 1991. From the total amount Rs. 15 lakhs was his
own contribution. The remaining Rs.40 lakhs was generated by
borrowing from financial institutions.

Following is the break-up of the utilization of the capital amount:-

Land and factory building Rs. 9lakhs.

Office furniture: Rs.1lakhs.

Machinery Rs. 20lakhs.

Vehicles Rs.16.5lakhs

Working capital Rs. 8.5lakhs

Monthly Expenses are as follow

Employees Salary Rs 60000

Machinery maintenance Rs 10000

Tempo Maintenance Rs 1200

Misalliance expenses Rs 7000

Infrastructure
Factory building

The area of the factory building is 1550Sq.ft. including the

administration office and the working area and industrial gala and
excluding the back office.

Machinery:-

There are five machineries for the purpose of production. The cost of
three machine were Rs. 3lakhs each and the other two machine were of
Rs 5.5 lakh each..All the safety precautions have been taken to avoid any
hazardous incidents.

Power supply:-

The power connection were obtained from MSEB. There is availability

of Generator in order to have continuous production in case of power
cut.

He received guidance from the state industrial infrastructure

development bodies like MIDC while setting up the factory.

Transportation:-

There are 2 delivery tempos. They are used for the purpose of bringing
in the raw material and to supply the ancillary units to the companies.
Manpower
GEE KAY ENGINEERS & TRADERS is having 12 employees for
the entire operation. they are:

Employee status no’s salary (in Rs)

Supervisor 1 7,000

Accountant 1 8000

Skilled Labors 3 6,000 per head

Drivers 3 4,000 per head

Semi-Skilled Labor 4 3,500 per head

Note:- Above stated salaries are paid on monthly basis.

Benefits given to the employees are as follows

1. Compensations

2. Perquisites

3. Bonus

4. Health Insurance Policy

Registration:-
These are the following registrations which Mr. Arvind had to apply for
before starting the production process:

1. Legalized industrial gala license

This license is required for small scale industry registration and
establishment.
2. Fire License
This license was issued by the local fire brigade at Ulasnagar.
Obtaining this license means that the factory has taken all the safety
precautions against fire accidents.

3. Wire cutting license

This license is required for manufacturing steel wires.
4. Pollution control licence
This is a common license required for any industry.
5. Trade Mark Registration
This certificate was obtained from the Trade Mark Office.
Suppliers & Storage System
Suppliers

- CRESANT steel,andheri

Most of the Raw materials are bought from CRESANT steel in both
credit and cash transaction.

Storage

- Open Storage System for final Product

The final product is ready for use therefore it is kept in storage where it
is easy to take the materials and deliver it to the dealers with fewer
restrictions

- Close Storage System for Raw Materials

Raw materials are kept very restricted and only authorized person are
allowed to enter such storage.

Raw Material
Major Quantity
Steel sheet
 Spring steel wires

Production Process

Frying/cooking the mixed

Marketing
Marketing refers to the promotion of products & services, advertising,
pricing, distribution channels, and branding. The term developed from
the original meaning which referred literally to going to market, as in
shopping, or going to a market to sell goods or services.

Marketing plays a very important role in all sectors for every

organization.

Distribution

Local dealers:-

The final products are distributed to the local dealers who have already
ordered for the product and who are the regular buyers.

In case of any special orders from new customers the

distribution/delivery is done according to the demand of the customer.

Transportation:-

The product is distributed through the company tempo for which

transportation charges are included in the bill.

Initial payment:-

After the good is delivered to the dealer an initial amount of the bill is
received immediately.

Bill of Credit (challan):-

The dealer after receiving the goods signs the challan as an assurance
which gives the detail of quantity of units received, initial amount paid
and balance to be paid.

Delivery note:-

The dealer along with the challan signs the delivery note which gives the
assurance

That the goods received are as per the requirements stated.

Management
The Management is handling by Mr.girish and he plays the following
roles

Meeting with the current suppliers

Arranging meetings with the suppliers in order to know the

views, their new materials and their previous payments.

Selection of new suppliers

Make continuous research about the new suppliers entering in

to the market, their prices and their credit limits.

Meeting/contacting the dealers

Meeting the dealers and try to know about their views regading
the product,& discuss about the credit sales.

The views from the dealers are important, if they are unsatisfied with
product quality then necessary steps are taken.
Future Scope
Setting up a new plant

Gee kay engineer & trader’ owner Mr. Girish has an idea of setting
up a new plant with modern technological machinery and equipments in
a few years to come. For that he has also selected the location in
THANE & TURBHE. The new plant will be started by 2012,he also
states that the new plant has a capacity which is almost double to his
ulasnagar plant and will give a output which will be sufficient to
expand his market share.

Expansion of market:-

Setting up a new pant (thane & turbhe) along with the older one will
increase production 10 times and can cover a wider market.

Expand the target

Expanding the monthly target to ten times more in five years.