BICYCLE RIMS

(A) INTRODUCTION:

         Bi-CYCLE Rims are manufactured in various designs and sizes, depending upon the wheel size & design of the cycle. The most common type of rims manufactured in India are Roadster Model Æ 28” & width 1½”. The desired shape can be obtained by adjusting /changing rolls. The thickness of strip used depends upon the O.E. manufacturer’s specifications. Still, for replacement market, 18 gauge strips is commonly used for cycle rickshaw and heavy duty load carrying on bicycle and 20 gauge strips for general bi-cycle.

(B) MARKET:

         Bi-cycle and rickshaw has remained a popular mode of transport in India for local traveling. Though with increasing urbanizations, motorcycle and scooter are becoming more popular still bicycle has maintained its position as a popular vehicle among lower income groups. Also with cycling becoming popular as fun and sport activity among youngsters and with increasing health consciousness the demand for racing as well as exercising bicycles is increasing day by day. The production of bicycles in India has increased from 5 million plus in 1986 to 11 million plus in the year 2000. India is exporting around 2 million bicycles annually. The total world production of cycles in the year 2000 was reported to be 101 Million. Looking to these figures it seems that there is a good scope development of rim industry.

(C) BASIS & PRESUMPTIONS:

Efficiency & working hours considered for full capacity utilization
:
 8 hours. Single shift working basis, at 75 % efficiency (25 working days a month)
Time period for achieving full/ envisaged capacity utilization.
:
 Approximately one year
Labour wages
:
 Un-skilled worker @ Rs. 50/-, Skilled worker @ Rs66/- per day
Interest rates for fixed and working capital
:
 12 %
Pay back period for the project
:
 Around 4.5 years
Land cost & construction or rental value with Approximate details
:
 Rent Rate Rs. 25/- per Sq. Mtr. Per month

(D) IMPLIMENTATION SCHEDULE:
         (Bicycle Rims)

TASK
MONTHS
 
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
1. Preparation of Project Report/ Business Plan
X
                      
2. SSI Registration (Provisional)
X
                      
3. Selection of site
X
X
                    
4. Statutory clearances/ licenses
X
  
X
                  
5. Submission of Term/ Working capital loan applications    
X
                  
6. Loan sanction    
X
X
X
              
7. Negotiations & securing possession of land/ Rental premises      
X
X
X
            
8. Building construction          
X
X
X
        
9. Tie up for supply of utilities (power, water etc.)          
X
X
X
        
10. Placing orders for Machinery      
X
X
              
11. Receipt & Installation of Machinery              
X
X
      
12. Recruitment of key manpower/ labour    
X
        
X
X
X
    
13. Procurement of Raw materials & Trial production                
X
      
14. Commencement of commercial production                  
X
    

 

(E) TECHNICAL ASPECTS:

         1.) Process Out-line: -The Rims are manufactured out of C.R.C.A. strips. The strip roll is mounted on the Rim forming machine and it is formed to the desired shape of the Rim when the strip is passing through the set of rollers .The formed strip is cut to the required length and rolled to round shape .the ends of the round shaped formed strip are welded on the butt welding machine. The butt-welding seam is ground on the Grinding machine. The Rim is then put on the Rim Rounding machine to get perfect round shape. Then nipple seats are drawn and nipple holes & valve holes are punched on the power press. The wheel is then straightened on the straightening machine. It is then passed on to polishing section for Buffing and polishing. Lastly it is electroplated, polished, inspected and packed.

2.) Quality Specifications: - The under mentioned Indian Standards can be useful in the manufacturer of Bi- cycle Rims—
                  IS: 624:1991, (Reaffirmed 2002) Bicycles-Rims-Specifications

                  IS: 10694 (Part-5)-1987, General requirements for Rims for Mopeds, M.Cycles, M.Cycle Derivative Rims.

3.) Production Capacity: -

                  Quantity: -              114000 Nos. per annum.
                  Value: -                  Rs. 9690000.

4.) Approximate Motive Power requirement: ---------30 KWH

5.) Energy conservation Needs: - Energy efficient motors can be installed. Workers can be educated about the importance of energy conservation.

6.) Pollution control Needs/ requirements: - Effluent from the electroplating plant is required to be treated (neutralized) before discharge.

(F) FINANCIAL ASPECTS:

         I) Fixed Capital: (Rs.)

i) Land & Building:

         Covered Area 250 sq. Meter                                                          Rs.
         Rented @ Rs.25 per Sq. Meter per month                                     6250

ii) Machinery & Equipment:

A. Production Unit:-  
1.
 Rim Forming Machine (completer with forming rolls & 10 H.P. electric motor.
1 No.
6,00,000
2.
 Butt Welding Machine
1 No.
50,000
3.
 Seam Welding Machine Complete with electrical.
1 No.
1,00,000
4.
 Butt weld Grinding Machine
1 No.
40,000
5.
 Rim Rounding Machine
1 No.
22,000
6.
 Rim Straightening Press (with electrical)
1 No.
35,000
7.
 Power Press for Nipple hole
1 No.
50,000
8.
 Valve hole Punching Machine
1 No.
20,000
9.
 Power Press 3 T complete with electrical.
1 no.
20,000
10.
 Stamping Press
1 No.
15,000
11.
 Buffing Addas
2 No.
35,000
12
 Electroplating plant complete with Surface Treatment Tanks and fittings etc.
1 No.
5,00,000
Sub-Total
14,87,000
Total
15,00,000
   
B. Testing Equipments: -
1. Measuring Instruments & Hand tools
L.S.
50,000
C. Pollution Control Equipments: -
1. Effluent Treatment Plant.
----
1,00,000
D. Energy Equipments: -
1. Generator set 25 KVA
1 No.
1,00,000
E. Electrification & Installation Charges @ 10 %(approx.) Of L.S. Cost of machines & equipments.
1,70,000
F. Cost of Tooling
L.S.
1,00,000
G. Cost of other fixed assets like office equipments & Working Tables etc.
L.S.
1,00,000
iii) Pre-operative expenses (Approx.)
25,000
Total fixed capital
21,45,000

II) Working Capital:

         i) Personnel:

SI.No.
Designation
No.
Salary (P.M.)
Total (Rs.)
1.
 Manager
1
10,000
10,000
2.
 Accountant
1
5,000
5,000
3.
 Clerck
2
2,250
4,500
4.
 Peon-cum-watchman
2
1,500
3,000
5.
 Supervisor-cum-inspector
2
6,000
12,000
6.
 Skilled Worker
6
2,000
12,000
7.
 Semi-skilled Worker
2
2,250
4,500
8.
 Buffing Polishing men
4
3,000
12,000
9.
 Unskilled worker (Helpers)
3
1,500
4,500
10.
 Sweeper
Part-time
500
500
Perquisites @ 15 % of salaries (Approx.)
11,100
Total
85,100
Say
85,000

         ii) Raw Materials (per month): -

SI.No.
 Description
Qty
Rate (Rs.)
Value (Rs.)
1.
 1. C.R.C.A. Strip in rolls 16 & 18 gauge
12.5 M.T.
32,000
4,00,000
2.
 2. Electroplating & other chemicals
L.S.
----
1,10,000
3.
 3. Packing Material
----
----
15,000
Total
5,25,000

         iii) Utilities (Per Month): -

Description
Amount (Rs.)
Rate (Rs.)
Cost (Rs.)
Water
30KL
15.00
450
Power
30 KWH
4.50
20,250
Total
20,700

         iv) Other Contingent Expenses (Per Month): -

         1.          Rent --------------------------------------------------------------6250
         2.          Postage & stationery --------------------------------------------- 1500
         3.          Telephone --------------------------------------------------------1000
         4.          Consumable store like Buffing wheels, emery compounds etc.----- 5000
         5.          Consumables like oils & lubricants --------------------------------3000
         6.          Repairs & Maintenance -------------------------------------------5000
         7.          Transportation & cartage Charges --------------------------------6000
         8.          Advertisement, publicity & Traveling ------------------------------5000
         9.          Insurance ---------------------------------------------------------2000
         10.          Misc. ------------------------------------------------------------2000
         Total: -          --------------------------------------------------------------36750

v) Total Recurring Expenses (pre month) ---------------------------------------Rs. 667450

vi) Total Working Capital (on 3 months basis) ---------------------------------Rs. 2002350

         Say ---------------------------------------------------------------------------------Rs. 2002000

vi) TOTAL CAPITAL INVESTMENT:
        i)         Fixed capital                 2145000
        ii)         Working capital            2002000
        Total:         -                      Rs. 4147000

G) MACHINERY UTILISATION:

        Same machinery with some adjustment can be used for the manufacture of Moped Motorcycle rims.

(H) FINANCIAL ANALYSIS:

1. Cost of production (per year) (Rs.)

        Total Recurring cost --------------------------------------------8008000
        Depreciation on production equipment @ 10 % ------------------100000
        Depreciation on Electroplating Plant, Effluent ---------------------140000
        Treatment Plant & Gen. Set @ 20 %
        Dep. on Measuring Insets., H. tools, Tooling @ 25% --------------37500
        Dep. On office equipments @ 20% --------------------------------25000
        Interest on total investment @ 12% -------------------------------510000

        Total: - --------------------------------------------------------------------8820500

2. Turn-over (per year)
        Item                                         Qty                         Rate                         Value(Rs.)
Moped/ Motor Cycle Rims         114000 Nos.           Rs.85/- Per Piece --------9690000
Scrap out of rejection                 7500 Kg.                 Rs.12/- Per Kg. -------------90000
Total Turnover: ---------------------------------------------------------------------------- 9780000

3. Net Profit per year (H.2-H.1)                                               Rs. 959500

4. Net Profit Ratio: -

        = Net Profit Per Year x100 / Turnover per year

        = 9.81 %

5 Rate of Return: -

        = Net Profit Per year x 100

        = 23 %

6. Break-even Analysis (%age of total production envisaged)

(i) Fixed Cost:                                                                         (Rs.)

        a)         Depreciations (all types) ------------------------302500
        b)         Rent on building ---------------------------------75000
        c)         Interest on investments -------------------------510000
        d)         Insurance ---------------------------------------24000
        e)         40 % of salaries & wages ----------------------408000
        f)         40 %of O.Es. Less insurance -------------------136800
                   & Rent
                   Total: ------------------------------------------------ 1456300

(ii) Net Profit per year (as at S. No. H.3): -------------Rs. 1456300

B.E.P.: - Fixed Cost. X 100 / Fixed Cost + Net Profit

        = 60.3 %

Names & Addresses of suppliers of Machinery & Equipments: -

         Rim Forming Machines-
                  M/s Sterco Welders (P) Ltd, 23, SSI Indl. Estate, G.T. Karnal Road, Delhi.
                  M/s Bilco Industries; Nirankari Street; No. 2, Indl. Area ‘B’, Ludhiana.

         Electroplating Plants & Salts-
                  M/s Raunik Industries; I/A, Abdul Gaffar Khan Road; Worki Sea face; Mumbai.
                  M/s Canning Metra Phoenex Pvt. Ltd.; 187, Dr. D.N. Road; Mumbai.
                  M/s Gravier & Weils (India) Pvt. Ltd.;Sulch Sagar Nagha Raod; Convir Chawapathi; Mumbai.
                  M/s Seqonds &Powls Pvt. Ltd.; B-27,Wzirpur Indl. Area; Delhi-110052.
                  M/s S. Singh & Co.; G.T. Road, Dholewal; Ludhiana.

         Welding Machines-
                  M/s Gaidu Electrical; Link Road, Ludhiana.
                  M/s Jindal Electricals; Indl. Area ‘A’; Ludhiana.
                  M/s Chawla Arc Welding Transformre; 1478, S.P. Mukherjee Marg; Delhi.

         Power Presses-
                  M/s Amar Engg.& Fabricators; Plot No. 5, Sectior 24; FAridabad.
                  M/s Prem Engg. Works; 22, Okhla Indl Estate;New Delhi-110020.
                  M/s Mankoo Machine Tools; 678, Indl. Area ‘B’ Ludhiana-141003.