Case Study on Chilli Processing Plant Essay Example for Free

Case Study on Chilli Processing Plant Essay In Nimad area there is a place Bedia which comes in Khargaun district, there is an SHG which runs by the Mr. Jain. They runs a chilly processing plant where they purchase the red dry chilly from market and sometimes direct from farmer and produce red chilly powder. They sell this powder to Vindhya Valley Company (semi government body) and sometimes in local markets. When we talked to Mr. jain about the processing plant that we have some SHG groups of horticulture, where we includes chilly crop in our project and wanted to set up a chilly processing plant, Then he told us about to the all the parameters of chilly processing plants. Main requirements: (1) Pulverizer machine: This is the main machine of plant which is use for crushing of red dry chilly. Basically this machine is a combination of two different size and shape of pulverizer, where at first in first pulverizer we put down our raw material (red dry chilly) then it breaks into small pieces and these small pieces automatically goes into second pulverizer where second pulverizer crush that small pieces into powder. (2) Filter machine: This machine is basically used for raw material, where atfirst we put raw material on machine then it separates the unwanted particles of raw materials. (3) Mixer machine: It is basically used for mixing the oil in raw material, here we generally use food oil for mixing. Where we put down the fix quantity of oil and raw material in machine and it will mix automatically both items correctly. (4) Infrastructure: We needs at least 500 sq/meter of single hall for this whole set up where we can establish these all three machines at ideal difference. (5) Manpower: For this plant we needs at least 10 to 12 man who can operate the machines. (6) Electricity connection: Since pulverizer machine has two deferent’s power motor one motor of 12.50 horse powers and second motor of 15 horse powers. And also filter and mixing machine has individual motor. Here this is the pictures of cone pulverizer and macro pulverizer. Main cost parameters: At first we talk about the machinery cost where main machine pulverizer’s cost would be 225,000/-rs for (400kg / per day capacity), and the whole machinery set up would be around 5 to 6 lacks rupees and also sometimes it will be vary from company to company. Electricity bill would be around 8 to 10 thousand rupees. Manpower cost would be 36000/- to 43200/- rupees on monthly basis, where we will give their 120/-rs at daily basis. Manpower cost can vary from no. of working days or if we appoint man at monthly basis. Raw material or input parameters: As we know that pulverizer machine has 400kg / per day capacity,so we have to plan for sufficient raw material on capacity basis. Generally we purchases raw materials from local markets or mandi, but it will be costly comparably purchasing of direct farmer because farmer at first sell his chilly in local market or mandi then we purchases from there so here they will give this material in high rates to us because they added their cost on this material. So it would be better for us if we direct purchase from farmers. Since raw material cost will direct affect our production cost, so we have to focus on our backward linkages. Sometimes because of lack of raw material plant can be in shut down condition while on other side we are paying regularly our expenses like electricity bill, labor payment etc. If we talk about the payment mechanism at this stage it can be either cash basis or credit basis. Where if we are purchasing direct from farmers generally we have to pay him at a time or after some days, while if we are purchasing from markets or mandi. Then payment period extension can be possible for days or months. Final product marketing or output parameters: This is the important part of processing plant which will be directly affect our profit factor. Here at first we should have plan to direct marketing because it will ensure us that this particular quantity of our final product will have to sell, according to that we can decrease our risk factor otherwise we can’t depend on retail market. Here other important factor is transporting cost. It also affects our selling price, so we should have already plan to our direct marketing on distance basis. Sometimes big company wants more products in that condition it would be negotiable. Sometimes company does agreements of final product purchasing where agreements can be on quantity basis or timely basis (like different quantity on different month), so it will be also profitable for us that for particular period we are ensure that this much our final product will sell, according to that we can manage our production cost. There are two different options for final product marketing. (1) First one is that if you have good relation in local markets and ensure about personal sufficient selling of final product through local market or dealers, which can be a good deal for you here you can manage your selling price in terms of transportation cost. (2) Second one is that if you have good agreements from big company on quantity basis or timely basis at suitable price, then here you can compromise with your transportation cost because here also you are ensure that this much our final product will definitely sell at good price. Here this is the picture of red chilly processing plant. Reference: -Vardhaman SHG group Place– Bedia, dist. Khargaun (Nimad area)