CHILDREN SHOES
BY INJECTION MOULDING

INTRODUCTION

         The Leather Industry is one of the oldest and traditional industries, which are mainly concentrated in the cottage and small-scale sector in India. There are hardly a few large-scale organized units in India, which account for less than 8 % of total output of children shoes in the country. The rest is made in cottage and small-scale sector.
         Making of shoes with hand made process is a skilled job of crafts and due to this reason like other crafts shoe making is also restricted to certain places like Agra, Kanpur, Delhi, Calcutta Madras & Bombay and to particular community of workers. Generally, the children shoe sole is attached to the lasted upper by stuck-on process - but it is better if the sole is attached by direct injection process, so that this product is more durable.
         These children shoes are more comfortable and durable and they can be used for school-going children as well as for other purposes.

MARKET

         These is ever increasing demand for leather footwear both India and abroad with the increased awareness of personal hygiene and spread of education almost all the people in the country have started wearing leather footwear. Moreover, the population of the country is ever going up resulting in higher and higher demands of the consumer item. India has the capacity to meet about 17% of world raw-leather requirements. However, at present, our production capacity in the footwear sector is very low, compared to countries like Japan, South Korea, etc, our productivity area at the best factory does not exceed 13 pairs sin Japan and 7.89 pairs in South Korea. In view of both national requirement and vast export potential, there is immense scope for further promotion of this industry in the country.

BASIS AND PRESUMPTIONS

        1. The production is based on single shift basis of 8 hours per day and 25 numbers of working days in a month.
        2. Five years period for achieving full capacity utilization.
        3. Lab our will be engaged on monthly basis keeping in view the present rates prevailing in the market.
        4. The interest rate for fixed and working capital is 16% per annum.
        5. Margin money of the total investment – 25%
        6. Pay back period is 10 to 12 years.
        7. Land and building – Rented.
        Covered area – 4000 sq. ft. (Rented) – Rs.10,000/- p.m.

IMPLEMENTATION SCHEDULE

         It will take one year’s to complete all the formalities starting the commercial production.

TECHNICAL ASPECTS

[1] Process of Manufacture:

         As per graded pattern of various sizes for both upper and lining, the components are cut and supplied to closing section. In closing section, the edges of the skived uppers are folded; the lining is pasted wherever necessary with the upper and stitched. After completion of stitching operation, decorative treatment on upper such as punching, fixed of eyelets, etc, is also done.
         In the making section, the uppers are lasted by machine. The lasted moulds are obtained and fitted in the machine. The PVC granules are fed according to the requirement into a heated cylinder from a topper. The injection cycle with closing and locking of the moulds under pressure applied automatically under pneumatic power. When the PVC granules in the cylinder is sufficiently softened by heat, the same is forced forward by raw action through an intermediate channel into the mould until it has cooled down to a state of sufficient rigidity and the pressure into moulds relaxed. The time cycle, therefore, can be adjusted into several stages, namely, mould filling time, dwell time under pressure, cooling time and mould opening time.

         The main operations are:
(1) Feeding of PVC granules into the hopper
(1) Timing of the surplus materials
(2) Cleaning
(3) Checking and packing.

[2] Quality Specifications:

         The quality of a product depends upon strict supervision and use of correct material according to the specification. In the DIP construction care should be taken while roughening the upper .If they over roughed, the fibers will be weakened .The adhesive should be properly applied to obtain permanent bond.

[3] Production Capacity
        Quantity:         75000 Pairs
        Value:         Rs. 1,84,50,000/-
[4] Approximate Motive power: 20 H.P
[5] Pollution Control
        This industry will not generate any type of pollution.
[6] Energy conservation
        Energy conservation in this type in un its is much on the lover side since low powerd motors are used in the production activity. The staff of the unit should be made aware of the need to conserve energy by switching off energy sources when not required.

FINANCIAL ASPECTS

[1] Land and Building: 4,000 sq. ft. - Rented: Rs10, 000/- per month.
[2] Machinery & Equipment

[3] Pre-operative expenses: -----------Rs.49,000/-

Total Fixed Capital (2+3): ------------Rs.43,70,000/-

WORKING CAPITAL

(A) Staff & Labour

(B) Raw Materials (Per Month)

(C) Utilities (Per Month)

D) OTHER CONTINGENT EXPENSES (PER MONTH)

(E) Total Recurring Expenditure (Per month)

        Total Working Capital
        (a+b+c+d)--------------------------------Rs.12,26,000/-
        Total Working Capital for 3 months-------Rs.36,78,000/-

5 TOTAL CAPITAL INVESTMENTS

        (i)         Fixed Capital -------------------------------Rs.43,70,000/-
        (ii)         Working Capital for 3 months-------------- Rs.36,78,000/-
        Total --------------------------------------------------------Rs.80,48,000/-

6. MAC HINERY UTILISATION

         Initially, there will be 60% utilization of major machinery and thereafter it will be increased @ 10% per year and 100% utilization will be achieved during the course of next five years.

FINANCIAL ANALYSIS

1. (I) Cost of Production per annum

        (i)         Total recurring cost per year ------------------------------1,47,12,000
        (ii)         Depreciation on machinery @ 10% -----------------------3,30,300
        (iii)        Depreciation on furniture, tools & equipment @20%----- 22,000
        (iv)         Depreciation on wooden last @ 20% --------------------24,000
        (v)         Interest on total investment @ 15% ----------------------12,87,680
        Total --------------------------------------------------------------------Rs.1,63,75,980

(2) Turnover (per year)

(3). Net Profit per year before taxation

        Turn over -------------------------------------1,84,50,000
        Cost of production ----------------------------1,63,75,980
        Profit -------------------------------------------------20,74,020

(4). Net Profit Ratio

        20,74,020x100 / 1,84,50,000
        = 11 %

(5).Rate of Returen on Total Investment

        20,74,020x100 / 80,48,000
        = 26 %

(6). Break Even Point

Fixed Cost
        (i)         Depreciation on machinery -----------------------------------3,30,300
        (ii)        Depreciation on furniture, tools, equipments------------------ 22,000
        (iii)       Depreciation on wooden last ---------------------------------24,000
        (iv)       Interest on total investment---------------------------------- 12,87,680
        (v)        40% salaries ------------------------------------------------7,39,200
        (vi)       40% of other expenses-------------------------------------- 1,44,000
        (vii)      Rent for one year --------------------------------------------1,20,000
        (viii)     Insurance ----------------------------------------------------36,000
        Total ------------------------------------------------------------------------Rs 27,03,180

BEP:        F.C. x 100 / F.C. + Profit

                27,03,180 x 100 / 27,03,180 + 20,74,020
                27,03,180 x 100 / 47,77,200
                = 56 %

Addresses of Raw Material Suppliers

        1.      M/s Abdul Wahid & Co
                19, Vapary High Road
                Chennai – 600 043

        2.     M/s Tamil Nadu Leather Development Corp., Ltd
                857, Periyar EVR High Road
                Kilpauk, Chennai – 600 010

        3.     M/s Valliappa Leather Corporation
                3/5 & 6, Narayana Chetty Street
                Periamet, Chennai – 600 003

        4.     M/s Bharani Agencies
                126, Thambuchetty Street, 3rd Floor
                Chennai – 600 001

        5.      M/s Synthokem Industries
                5, Hindi Prachar Sabha
                Chennai – 600 001

        6.     M/s Omega Poymicrous Pvt Ltd
                3/A, M.V. Badran Street (1st Floor)
                Periamet, Chennai – 600 003

        7.     M/s J.P. Coats (P) Ltd
                Opp. Arts Crawford Market
                Mumbai – 400 003

        8.     M/s Modi Thread
                Modi Nagar (UP)

Addresses of Machinery Suppliers

        1.      M/s Bharat Sales Agencies
                Greshon Assurance House
                3rd Floor
                Sir PM Road
                Mumbai – 1

        2.      M/s Harmen Sales Union
                24, Kala Bhavan, Mathew Road
                Mumbai - 4