RURAL TOURISM

1. INTRODUCTION

There are various streams of tourism – physical features (mountains, beaches, desert) cultural
history, architecture, lifestyle, dance, music, etc.), adventure (trekking, rafting, water sport,
etc.). However, middle/upper class tourists, irrespective of the nature of vacation–destination
which they go to, stay-in most cases at conventional hotels, eat routine/rich food and go for
sightseeing/excursions. While the destinations bring variety into the vacation experience, most
vacations continue to be marked by “sameness” in terms of stay, food and such other
elements.

At another level, urban residents are now fairly disconnected from village life; having been
born and having grown up in a city. There are aspects of village life which, if packaged
appropriately, have the potential to offer a new, exciting and fulfilling holiday experience to
city dwellers. Rural tourism is a way of delivering such experience.

2. PROJECT PROPOSAL

It is proposed that the promoter establishes a rural tourism project in a village. The location
should possess all or some of the following features.

 The location/surrounding area should be sparsely populated

 The location/nearby area should offer some natural beauty
 There should be scope for fulfilling village-level experience, e.g., farming, milking cattle,
cart-ride, artisanal work (e.g., pottery, carpentry), craftwork, dancing, singing, local sport,
cooking local cuisine
 the climate should be congenial at least during six months in a year

The project will consist of following components

 First establishing huts/housing units and furnishing these in local architectural/aesthetic

style. In addition, there will be facility for food and beverage and relaxation

 Organization of events at the site, e.g., dance, music, cookery demo, craftwork demo,
story-telling.
 Organization of experiences – nature trail, fruit picking, farming, fishing, water-drawing
from the well, craft/artisanal work, cooking, local sport, visit to monuments/heritage,
donning local clothes.

In other words, the soft or experience based elements to be woven into the project are as
important as the physical facilities to be set up under the project.

The project will utilize local events - cattle fair, sport meets, cultural fairs, etc. - to enrich
tourist experience.

Depending on weather, the project may operate the whole year or some months in a year.
Likewise, events/experiences may vary from time to time, depending on what is feasible to
offer.

3. DESIRABLE PROMOTER BACKGROUND

It will be useful, if the promoter hails from the village/area. If he is a permanent resident of
the village/area, it is an added advantage.

The key competencies required are:

 Setting up a facility which showcases village-life and ambience in an authentic yet pleasant
way
 Networking to get other stakeholders to come to the project site or engage with tourists
at off-site venues
 Imaginative scanning of various elements in/around the village and formulating tourist-
experiences around these.

On the whole, this is an experience-based (not merely stay, food and recreation) project and
the promoter preparedness for delivering a memorable experience, depending on the profile
of the tourist, matters most.

4. INDUSTRY OUTLOOK AND TREND

In the wake of tourism growth, it is natural for the tourism market to become segmented and
new segments to emerge. Rural tourism is a segment of relatively recent vintage. Any form
of tourism, which showcases the rural life, art, culture and heritage at rural locations, thereby
benefitting the local community in economic and social ways and promoting meaningful
engagement between the community and tourists is called ‘rural tourism’. The underlying
objective is to preserve ecology, culture and traditions. It is experience-oriented; farming,
fishing, participation in local fairs/events.

There is a positive nexus between growth in urbanization and demand for rural tourism. In
addition, it is a form for which expansion of location-choice and establishment of few more
enterprises will lead to market growth. There is an enhanced awareness among villagers
regarding rural tourism business prospects; they are quickly learning to put together attractive
packages and this will ensure health growth of rural tourism in India.

5. MARKET POTENTIAL

The market potential for rural tourism stems from the following drivers.

 There is growing urbanization. Several urban dwellers are disconnected from rural life.
Given perception regarding simplicity and purity of rural lifestyle, there is interest among
city dwellers in rural tourism experience.
 The vacation experiences rooted in conventional hotel stay have become routine and
holidayers crave for change. Rural tourism offers a cost-effective and environment-friendly
change.
 Rural tourism offers such rewards as de-stressing and organic food and beverage. It is
important to remove misconceptions, in some quarters, that rural tourism suffers from
weak hygiene and sanitation. Likewise, it is essential to assure customers about safety.

The private entrepreneurs as well as Govt. of India have recognized the significance of rural
tourism. The Govt. of India has supported 153 rural tourism projects. UNDP is assisting 36
rural local locations to build capacity for rural tourism. The Govt. of India extends financial
assistance to rural tourism projects for such purposes as improvement in village surroundings,
construction of roads, solid waste management, provision of adventure/sport equipment,
signage, reception, refurbishment of monuments and provision of accommodation. However,
the assistance is routed to state-level official tourism agency and hence private entrepreneur
needs to coordinate with such agency.

The following rural tourism projects have received considerable praise.

 Hodka village, Kutch, Gujarat
 Naggar Village, Kullu, Himachal Pradesh
 Itmenaan Lodges – Punjabiyat, Punjab
 Ecosphere Spiti, Himachal Pradesh
 Tora Eco Resort, Sunderbans, West Bengal
 The 4 tables Project, Himachal Pradesh
 Chhotaram Prajapat, Rajasthan
 Lakshman Sagar, Rajasthan
 Green Pastures, Assam
 Grassroutes, Maharashtra

The rural tourism projects, in some cases are marked by emphasis on a theme, e.g.,
agriculture, food routes, community ecology, ethnicity/culture.

In addition to individual tourists, rural tourism offers scope for attracting corporate groups,
student groups, senior citizen groups and other groups. The project can be located either at
popular tourist destination or within convenient reach from major cities. In the later case, the
project will be a stand-alone or exclusive attraction for the customers.

6. PROPOSED SIZE OF THE PROJECT

The project will be spread over an area of 20,000 sq. mtrs. (five acres). The site will be
characterized by old and traditional trees and shrubs. A part of the site will be devoted to
regular farming activity. The project facility will consist of

 15 huts/residential units, with a sit-out area, built and furnished in local style.
 10 of these 15 huts will be air-conditioned to accommodate the tourist-need during
unfavorable weather period.
 A common dining area, preferably half open, marked by local style furniture/furnishing
and decorated with local/regional artwork-textile, metal, terracotta.
 An area, where artists/craft persons can perform and tourists can assemble for easy
viewing.
 A cattle and poultry area – cows, buffaloes, camel/yak (if any), chickens, ducks. These will
be looked after by the project management and put to productive use.
 A fruit-cum-vegetable growing area
The project will possess/hire transport facility for fun as well as functionality – carts, bicycles,
jeep, SUV. It will have a traditional well from which tourists can draw water. There will be
hammocks tied to tree branches. There will be a camp fire site

7. MANUFACTURING PROCESS

This is a service sector project and hence the following is pertinent.

TECHNICAL REQUIREMENT

The project would require a reliable supply of utilities – water supply, electricity. The
architecture, though ethnic in character, should serve the functional needs efficiently; it should
not cause leaky roofs or bathrooms. The complex layout, design, material for construction and
other elements should produce authentic and pleasant village ambience. Based on weather,
tourist profile and other conditions, management will have to decide upon the number of
months for which the complex would work in a year.

OPERATIONAL REQUIREMENT

We presume that the complex will work for eight months in a year. It will remain closed during
four months on account of harsh weather (heat or cold). It will provide meals on buffet basis
(barring special needs) because it is not a conventional hotel and its menu will have a rural
character. In terms of activities/experiences, it will provide a choice. It will not charge fee for
activities/experiences which the customer does not wish to avail of. On the other hand, there
will be activities/experiences which will be built into the package and will not be charged extra.
An illustrative list of such apparently free activities is as follows.

 Farming, milking cattle

 Cultural/sport events at the complex
 Cookery demonstration

The complex will not provide any cable TV or internet facility.

There will be a separate charge for excursions, donning local clothes, fishing and such other
activities.

The tariff will provide two options

− Accommodation, breakfast, afternoon tea and lunch or dinner

− Accommodation, breakfast, afternoon tea, lunch and dinner

8. MANPOWER REQUIREMENT
The promoter will be in overall charge. The manpower requirement is as follows.
Reception/Housekeeping: 4 persons
Food and Beverage: 6 persons
(kitchen and dining area)
Admin/account/marketing: 1 person
Event/Experience Coordination: 1 person
Other staff 3 persons
------------
Total 15

In addition, there will be part-time persons to look after agriculture, animal husbandry and
such other tasks.

9. COST OF THE PROJECT

The land will be secured on a long term lease basis. The cost of the project is estimated as
follows (Rs.in lacs)

Land lease for one year 10.00

Expenditure on site development and reliable utility 5.00
Supply arrangement
15 huts complete with bathroom, dining area/ Reception/office 25.00
Furniture/furnishing for 15 huts (including air-condition 15.00
in 10 huts), dining, reception/office areas
Crockery, utensils, pots and pans, kitchen equipment 7.00
Housekeeping equipment, DG set
Special utility vehicle, bicycles, carts, livestock 13.00
Preliminary and Pre-operative expenses @ 10% of 1 to 6 7.50
Working Capital Margin 5.00
---------
Total 87.50
-------
10. WORKING CAPITAL REQUIREMENT

This is estimated at Rs. 5.00 lacs and we do not envisage working capital loan.
The working capital margin is on account of salaries and wages, payment to artists/craft
persons, utilities and stock of food, beverage and maintenance spares/parts.

11. MEANS OF FINANCE

The investment in land, since it is on lease basis, will not qualify for loan. The ethnic style of
construction may cause the bank to stipulate a higher margin. On the whole, we expect a
debt-equity ratio of 1.5 to 1, implying a term-loan of Rs.52.5 lacs and equity of Rs.35 lacs.
The term loan will carry interest @ 11%, it will be repayable in five years after a moratorium
period of six months during which interest will be payable.

12. MACHINERIES AND ILLUSTRATIVE LIST OF SUPPLIERS

The project would require mainly kitchen equipment & housekeeping equipment.

KITCHEN EQUIPMENT

 Gas bank, steam cooking devices, tandoors, preparation equipment, warmers,

brain maries, trolleys, washing equipment, sinks, exhaust system, ventilation
equipment, refrigerated equipment, freezers and grills, pots, pans, safety
equipment.

HOUSEKEEPING EQUIPMENT

Vacuum cleaners, water tank cleaning equipment, janitor multifunction carts.

SUPPLIERS

KITCHEN EQUIPMENT

1. Hotel Kitchen Equipments India, Ahmedabad

2. Vibhu Kitchen Equipment, New Delhi
3. Mehta Kitchen Equipments, New Delhi
4. Galaxy Engineers, Pune

HOUSEKEEPING EQUIPMENT

1. SGT Multiclean Equipments, Bengaluru

2. Yuva Safety India, Hyderabad
3. Blue Ocean Cleaning Solutions, Mumbai
4. Anakali, Delhi
5. Amsse Products India, Delhi

13. PROFITABILITY STATEMENT

The main streams of income are as follows

 Tariff for accommodation, food and beverage

 Fees for excursions/events/experiences
 Group events-retreats or brainstorming, small social/personal celebrations or such other
group bookings. The groups will choose the menu/events/experiences and there will be
an all-inclusive package tariff.

The tariff including all meals will be Rs.3000 per hut-night (double occupancy) while that for
hut/breakfast/one meal will be Rs.2500 per hut night in the second year. We expect the
project to realize Rs.2750 per hut-night in the second year.

We expect hut-occupants (two) to spend @ Rs.600 per day for excursions/events/experiences

in the second year.

We assume a group tariff realization @ Rs.3000 per hut-night (double occupancy) covering
accommodation, all meals, and excursions/events/experience

Our estimate of hut occupancy in the second year is 50%...

The group bookings will be in addition to these. There will be 10 group bookings during the
second year (10 huts double-occupancy). The operating income during the second year is
computed below (Rs. in lacs).
The operating income (second year)

Sr. No. Year 1

1. Occupancy (no. of huts) 7.5
2. Working Days 240

3. Average Package Tariff Realization (Rs.) 2750

4. Package Tariff Income (Rs.in lacs) 49.50
5. Extra meal income @10% of 4 4.95
 6. Fees for excursion @Rs.600 per occupied hut 10.80
7. Group-booking income 4.50
8. Miscellaneous income (extra bed, transport, 3.50
activities, etc.) (@5% of 4 to 7)
Total operating income 73.25

The operating expenses are estimated as follows (second year)

(Rs. in lacs)
 Manpower (10 months) 18.00
 Utilities 4.00
 Housekeeping, toiletry supplies, laundry, etc. 2.00
 Cost of food and beverage
- Individual package tariff @10% of package tariff 4.95
- group booking @12.5% of group tariff income 0.56
 Marketing, admin, taxes, insurance 3.00
 Special activities, e.g., dance/music 2.00
 Repair, maintenance 5.00
--------
Total Operating Expense 39.50

Profitability Over Five Years (Rs. in lacs)

Sr. No. Particulars Year 1 Year 2 Year 3 Year 4 Year 5

1 Operating income 65.93 73.25 76.91 80.76 84.80

2 Operating Expenses 39.50 39.50 40.29 41.09 41.92

3 Operating Surplus 26.43 33.75 36.62 39.67 42.88

4 Interest on Term-loan 5.49 4.62 3.47 2.31 1.16

5 Depreciated and Amortization 12.38 12.38 12.38 12.38 12.38
6 Profit Before Tax 8.56 16.75 20.77 24.98 29.34
7 Tax (30%) 2.57 5.03 6.23 7.49 8.80
8 Profit after tax 5.99 11.72 14.54 17.49 20.54

We have assumed operating income growth @5% per annum, beginning third year and
operating expense hike @2% per annum from third year onward. The operating income
during the first year will be 10% lower than second year but operating expense will be
identical.

The unit cost of power is taken at Rs. 6. The depreciation is taken at the rate of 15%.

14. IMPLEMENTATION SCHEDULE

It will take eight months, since possession of land, to implement the project.
The milestones will be

 Cleaning and sprucing up of premises 1 month

 Interior design and plan simultaneous
 Execution of interior plan 3 months
 Hiring of manpower 1 month
 Pre-opening promotion 1 month
 Trial Run 1 month
 Opening 1 month

15. BACKWARD AND FORWARD LINKAGES

The project can diversify into experience tourism and offer packages built around farming,
fishing, forestry and such other experiences.

16. STATUTORY / GOVERNMENT APPROVALS / CLEARANCE

The project needs to carry out general formalities pertaining to firm establishment; tax
registration and shops/establishment registration. The fire safety clearance is the specific
requirement.

The following specific permits are required

 Pollution Control Clearance from the state government board; National Green
Tribunal in some cases.
 Protected Area permit, if the site is in forest area.

17. TRAINING / COURSES

Entrepreneurship program helps to run business successfully is also available from Institutes
like Entrepreneurship Development Institute of India (EDII) and its affiliates all over India.

Disclaimer:
Only few machine manufacturers are mentioned in the profile, although many machine
manufacturers are available in the market. The addresses given for machinery manufacturers
have been taken from reliable sources, to the best of knowledge and contacts. However, no
responsibility is admitted, in case any inadvertent error or incorrectness is noticed
therein. Further the same have been given by way of information only and do not carry any
recommendation.
Use all the templets provide below to
design your own
BUSINESS PLAN
EXECUTIVE SUMMARY

This business plan is a projection for the period from ____ / ____ / 20____ till ____ / ____ / 20____

Name of the business: ____________________________________________________________________________________________________________

Contact address: _______________________________________________ Telephone: ____________________________________________

Type of business: Legal form: _____________________________________________

•• Manufacturer of the following good(s): Owners:_____________________________________________

•• Service operator to provide the following service(s):

_____________________________________________
•• Retailer running the following type of shop:
Managers: ____________________________________________
•• Wholesaler running the following wholesale business:
_____________________________________________
•• Other (please specify):
_____________________________________________
______________________________________________________________ Qualifications and experience in attached CVs

: Sources of start-up capital:

Customers: ____________________________________________________
___________________________________ ____________________
_______________________________________________________________
___________________________________ ____________________
Staff: _________________________________________________________
___________________________________ ____________________
______________________________________________________________
___________________________________ ____________________
______________________________________________________________
___________________________________ ____________________
 1. BUSINESS IDEA

Name of the business: ____________________________________________________________________________________________________________

Type of business:

Manufacturer Service operator Retailer Wholesaler Other: ___________________________________________________

The business is going to produce the following products: _____________________________________________________________________________

_______________________________________________________________________________________________________________________________

The customers will be: ___________________________________________________________________________________________________________

_______________________________________________________________________________________________________________________________

The business will sell in the following ways: _________________________________________________________________________________________

_______________________________________________________________________________________________________________________________

The business will satisfy the following needs of the customers: ________________________________________________________________________

_______________________________________________________________________________________________________________________________

My personal motivation to retain this business idea: _________________________________________________________________________________

 2.1 MARKET RESEARCH

Needs and preferences of Gaps (that competitors

Products Customers Competitors
customers have not fulfilled)
Product 1:

Product 2:

Product 3:

Product 4:
 2.2 Marketing Plan
Product

Good, service or range of products:

1.______________________ 2. ______________________ 3. ______________________ 4. ______________________

Quality

Colour

Size

Packaging

Certification
 2.3 Marketing Plan
Price

Good, service or range of products:

1.____________________ 2. ____________________ 3. ____________________ 4. ____________________

Cost

The price that customers are willing to

pay

Competitors’ prices

Price

Reasons for setting this price

Discounts will be given to the

following customers

Reason for giving discounts

Credit will be given to the following

customers

Reason for giving credit

 2.4 MARKETING PLAN
Place

Location:

_______________________________________________________________________________________________________________________________

_______________________________________________________________________________________________________________________________

This location is chosen for the following reasons:

_______________________________________________________________________________________________________________________________

_______________________________________________________________________________________________________________________________

The monthly cost of this location is: ____________________( → section 6.3) This cost includes: _________________________________________

Method of distribution:

The business will sell to:

Direct Retail Wholesale Others (please specify): __________________________________________

This method of distribution is chosen for the following reason:

_______________________________________________________________________________________________________________________________

_______________________________________________________________________________________________________________________________

_______________________________________________________________________________________________________________________________
 2.5 MARKETING PLAN
Promotion

Means Details Costs

Direct marketing

Advertising

Publicity

Sales promotion

→ section 6.3)
Total promotion costs (
 2.6 MARKETING PLAN
People

Position Recruiting criteria Training plan

 2.7 MARKETING PLAN
Process

Steps Description

1.

2.

3.

4.

5.

6.

7.
 2.8 MARKETING PLAN
Physical Evidence

Physical Evidence Description

Office premises and interior decoration

Internet presence and website

Packaging

Signage

Employee uniforms

Business cards

Mail boxes, etc.

 3. SALES ESTIMATION

Product Distribution Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec TOTAL
1. Direct

Retail

.....

Total

2. Direct

Retail

.....

Total

3. Direct

Retail

.....

Total

4. Direct

Retail

.....

Total

Total sales volume

Total sales in the market

Market share
 4.1 ORGANIZATION STRUCTURE

Tasks and responsibilities Position Staff

1.

2.

3.

4.

5.

6.

7.
 4.2 STAFF REQUIREMENTS AND COSTS
Contributions to
Task Required skills and experience Performed by Monthly pay pension fund and health
insurance

Total number of permanent staff

→ Section 6.3)
Total staff cost per month (
 5.1 LEGAL FORM OF BUSINESS

The business will operate as a: Sole Proprietorship Partnership Cooperative Limited Company

Other: __________________________

The reason for choosing this form of business is:

_______________________________________________________________________________________________________________________________

_______________________________________________________________________________________________________________________________

The owners will be:

Name: ___________________________________________________ Name: ___________________________________________________

Position in the business: ____________________________________ Position in the business: ____________________________________

Description of skills: Description of skills:

__________________________________________________________ __________________________________________________________

__________________________________________________________ __________________________________________________________

__________________________________________________________ __________________________________________________________

Relevant experience: Relevant experience:

__________________________________________________________ __________________________________________________________

__________________________________________________________ __________________________________________________________

__________________________________________________________ __________________________________________________________
 5.2 LEGAL RESPONSIBILITIES AND INSURANCE

The following taxes apply to the business: ___________________________________________________________________________________________

_______________________________________________________________________________________________________________________________

_______________________________________________________________________________________________________________________________

The following regulations apply to the employees: _____________________________________________________________________________________

_______________________________________________________________________________________________________________________________

_______________________________________________________________________________________________________________________________

The business will need the following licences and permits: Cost:

__________________________________________________________________________________________________ ___________________________

__________________________________________________________________________________________________ ___________________________

The business will have the following insurance:

__________________________________________________________________________________________________ ___________________________

__________________________________________________________________________________________________ ___________________________

Other legal responsibilities of the business:

__________________________________________________________________________________________________ ___________________________

__________________________________________________________________________________________________ ___________________________
 6.1 PRODUCT COSTING FORM
(for manufacturers and service operators)

Product 1:

1. VARIABLE COST PER ITEM

1 2 3 4
Estimated Estimated cost
Input Cost of purchase
quantity per item per item

Estimated Variable Cost per item (1) ( → section 6.5)

2. FIXED COST PER ITEM

Estimated total Fixed Cost per month (2) (see section 6.3)
Estimated total Variable Cost of the business per month (3) (see section 6.5)
Fixed Cost per Variable Cost (4) = (2)/(3)
Estimated Fixed Cost per item (5) = (4) x (1)

3. TOTAL COST PER ITEM (6) = (1) + (5)

 6.1 PRODUCT COSTING FORM
(for manufacturers and service operators)

Product 2:
1. VARIABLE COST PER ITEM

1 2 3 4
Cost of Estimated Estimated cost
Input
purchase (RS) quantity per item per item (RS)

Estimated Variable Cost per item (RS) (1) ( → section 6.5)

2. FIXED COST PER ITEM

Estimated total Fixed Cost per month (RS) (2) (see section 6.3)
Estimated total Variable Cost of the whole business per month (RS) (3) (see section 6.5)
Fixed Cost per Variable Cost (4) = (2)/(3)
Estimated Fixed Cost per item (RS) (5) = (4) x (1)

3. TOTAL COST PER ITEM (RS) (6) = (1) + (5)

 6.1 PRODUCT COSTING FORM
(for manufacturers and service operators)

Product 3:

1. VARIABLE COST PER ITEM

1 2 3 4
Cost of Estimated Estimated cost
Input
purchase (RS) quantity per item per item (RS)

Estimated Variable Cost per item (RS) (1) ( → section 6.5)

2. FIXED COST PER ITEM

Estimated total Fixed Cost per month (RS) (2) (see section 6.3)
Estimated total Variable Cost of the business per month (RS) (3) (see section 6.5)
Fixed Cost per Variable Cost (4) = (2)/(3)
Estimated Fixed Cost per item (RS) (5) = (4) x (1)

3. TOTAL COST PER ITEM (RS) (6) = (1) + (5)

 6.1 PRODUCT COSTING FORM
(for manufacturers and service operators)

Product 4:

1. VARIABLE COST PER ITEM

1 2 3 4
Cost of Estimated Estimated cost
Input
purchase (RS) quantity per item per item (RS)

Estimated Variable Cost per item (RS) (1) ( → section 6.5)

2. FIXED COST PER ITEM

Estimated total Fixed Cost per month (RS) (2) (see section 6.3)
Estimated total Variable Cost of the business per month (RS) (3) (see section 6.5)
Fixed Cost per Variable Cost (4) = (2)/(3)
Estimated Fixed Cost per item (RS) (5) = (4) x (1)

3. TOTAL COST PER ITEM (RS) (6) = (1) + (5)

 6.2 PRODUCT COSTING FORM
(for retailers and wholesalers)

FIXED COST CHARGE (%)

TOTAL FIXED COST PER MONTH (2) (see section 6.3)

= x 100 = %
TOTAL VARIABLE COST PER MONTH (3) (see section 6.6)
FIXED COST CHARGE (4)

1 2 3
Fixed Cost per item (RS) Total Cost per item (RS)
Product Variable Cost per item (RS) (1)
(5) = (1) x (4) (6) = (1) + (5)
 6.3 FIXED COST FORM

Details Cost per month (RS)

Rent (see section 2.4)

Electricity and water including waste water

Licences

Insurance

Labour (see section 4.2)

Consumables including recycling and disposal

Depreciation ( see section 6.4)

Transport

Repairs

Marketing (promotion) costs (see section 2.5)

Total Fixed Cost per month

 6.4 DEPRECIATION FORM

Equipment Estimated cost of purchase (RS) Estimated life of the equipment Depreciation per year (RS)

Total

Depreciation per month

 6.5 TOTAL VARIABLE COST PER MONTH

Quantity produced per month Variable Cost per item (RS)

Products Total Variable Cost per month (RS)
(see section 3) (see section 6.1)

Product 1:

Product 2:

Product 3:

Product 4:

Total Variable Cost per month

 6.6 MONTHLY PURCHASE FORM

Estimated number of items sold Variable Cost per item Total Variable Cost
Product
per month (RS) (see section 3) (purchase price) (RS) per month (RS)

Total Variable Cost per month

 7.1 SALES PLAN
Product Details Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total
Product 1:
Sale volume

Sales price (RS)

Sales value (RS) (1)

Product 2:
Sale volume

Sales price (RS)

Sales value (RS) (2)

Product 3:
Sale volume

Sales price (RS)

Sales value (RS) (3)

Product 4:
Sale volume

Sales price (RS)

Sales value (RS)

(4) Total sales value (RS)
(5) = (1) + (2) + (3) +(4)
 7.2 COST PLAN
Product Details Jan Feb Mar Apr May Jun July Aug Sep Oct Nov Dec Total
Product 1: Production volume

Variable Cost per item (RS)

Total Variable Cost (RS) (1)

Product 2: Production volume

Variable Cost per item (RS)

Total Variable Cost (RS) (2)

Product 3: Production volume

Variable Cost per item (RS)

Total Variable Cost (RS) (3)

Product 4: Production volume

Variable Cost per item (RS)

Total Variable Cost (RS) (4)

Total Variable Cost of the business (RS)

(5) = (1) + (2) + (3) + (4)

Total Fixed Cost (RS) (6)
Total cost (RS) (7) = (5) + (6)
 7.3 PROFIT PLAN
(Unit: )

Details Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Total sales value (1)

(see section 7.1)

Total Variable Cost (2)

(see section 7.2)

Gross Profit
(3) = (1) – (2)

Total Fixed Cost (4)

Net Profit
(5) = (3) – (4)
 7.4 CASH FLOW PLAN
(Unit: )
Details Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

1. Cash at the beginning of the

month (1)

2. Cash from cash sales

CASH IN

3. Cash from credit sales

4. Other cash in

5. Total cash in (2)

6. Purchase of goods

7. Payment of wages
CASH OUT

8. Purchase of equipment

9. Loan repayment

10. Other payments

11. Total cash out (3)

12. Cash at month end

(4) = (1) + (2) - (3)
 8. REQUIRED START-UP CAPITAL
For the period from: _______________________ to: _______________________
(Unit: )

INVESTMENTS Amount

Business premises

•• Construction or purchase of a building

•• Conversion or reconstruction of business premises

Equipment

•• Machinery and Tools

•• Furniture

WORKING CAPITAL

Stock of raw materials or finished goods

Licenses and fees

Marketing expenses

Salaries

Rent

Electricity and water

Contingency for emergency

TOTAL START-UP CAPITAL

 9.1 SOURCES OF START-UP CAPITAL
( Unit: )

Amount

Required start-up capital

Sources of start-up capital

•• Owner’s equity

•• Other sources

Total (must be the same amount as the required start-up capital)

Collateral (if applying for a loan)

 9.2 LOAN REPAYMENT SCHEDULE

Loan provider: _________________________________________________________________________________________

Total amount borrowed: _______________ Loan period: _______________ Instalment period: _______________

Interest rate: _______________ Grace period: _______________ 1st year capital cost: _______________ ( see section 7.2)

Insurance policy: __________________________________________________________________________________________

Instalment period Outstanding capital Instalment Capital repayment Interest Insurance

1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
Total