Meat Shop (1.24 Million)

Pre-Feasibility Study
(Meat Shop)
Small and Medium Enterprises Development Authority

Ministry of Industries & Production
Government of Pakistan
www.smeda.org.pk
HEAD OFFICE
4th Floor, Building No. 3, Aiwan-e-Iqbal Complex, Egerton Road,
Lahore
Tel: (92 42) 111 111 456, Fax: (92 42) 36304926-7
helpdesk@smeda.org.pk
REGIONAL OFFICE
Punjab
REGIONAL OFFICE
Sindh
REGIONAL OFFICE
Khyber Pakhtunkhwa
REGIONAL OFFICE
Balochistan
3rd Floor, Building No. 3,

Aiwan-e-Iqbal Complex,
Egerton Road Lahore,
Tel: (042) 111-111-456
Fax: (042) 36304926-7
helpdesk.punjab@smeda.org.pk
5th Floor, Bahria

Complex II, M.T. Khan Road,
Karachi.
Tel: (021) 111-111-456
Fax: (021) 35610572
helpdesk-khi@smeda.org.pk
Ground Floor
State Life Building
The Mall, Peshawar.
Tel: (091) 111-111-456
Fax: (091) 5286908
helpdesk-pew@smeda.org.pk
Bungalow No. 15-A

Chaman Housing Scheme
Airport Road, Quetta.
Tel: (081) 2831623, 2831702
Fax: (081) 2831922
helpdesk-qta@smeda.org.pk
Note: All SMEDA Services / information related to PM's Youth Business Loan are Free of Cost
May, 2014
Table of Contents
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
DISCLAIMER...................................................................................................................................... 2
PURPOSE OF THE DOCUMENT ................................................................................................... 3
INTRODUCTION TO SMEDA .......................................................................................................... 3
INTRODUCTION TO SCHEME ....................................................................................................... 4
EXECUTIVE SUMMARY .................................................................................................................. 4
BRIEF DESCRIPTION OF PROJECT & PRODUCT ................................................................... 4
CRITICAL FACTORS ....................................................................................................................... 5
INSTALLED & OPERATIONAL CAPACITIES ............................................................................. 5
GEOGRAPHICAL POTENTIAL FOR INVESTMENT .................................................................. 5
POTENTIAL TARGET MARKETS .................................................................................................. 6
PROJECT COST SUMMARY .......................................................................................................... 6
11.1
11.2
11.3
11.4
11.5
11.6
11.7
11.8
11.9
11.10
12.
13.
CONTACTS OF SUPPLIERS AND CONSULTANTS ...............................................................11

ANNEXURE .......................................................................................................................................12
13.1
13.2
13.3
13.4
13.5
14.
PROJECT ECONOMICS ................................................................................................................... 6

PROJECT COST ............................................................................................................................. 7
SPACE REQUIREMENT .................................................................................................................. 7
MACHINERY AND EQUIPMENT...................................................................................................... 8
OFFICE EQUIPMENT ...................................................................................................................... 8
FURNITURE AND FIXTURE ............................................................................................................. 9
RAW MATERIAL REQUIREMENTS ................................................................................................. 9
HUMAN RESOURCE REQUIREMENT .............................................................................................. 9
REVENUE GENERATION...............................................................................................................10
OTHER COSTS .........................................................................................................................10
INCOME STATEMENT ............................................................................................................12

BALANCE SHEET ....................................................................................................................13
CASH FLOW STATEMENT .....................................................................................................14
USEFUL PROJECT MANAGEMENT TIPS .............................................................................15
USEFUL LINKS.............................................................................................................................16
KEY ASSUMPTION..........................................................................................................................18
1.
(Meat Shop Rs.1.24 Million)
DISCLAIMER
This information memorandum is to introduce the subject matter and provide a

general idea and information on the subject. Although, the material included in
this document is based on data/information gathered from various reliable
sources; however, it is based upon certain assumptions which may differ from
case to case. The information has been provided on as is where is basis without
any warranties or assertions as to the correctness or soundness thereof.
Although, due care and diligence has been exercised to compile this document,
the contained information may vary due to any change in any of the concerned
factors, and the actual results may differ substantially from the presented
information. SMEDA, its employees or agents do not assume any liability for any
financial or other loss resulting from this memorandum in consequence of
undertaking this activity. The contained information does not preclude any further
professional advice. The prospective user of this memorandum is encouraged to
carry out additional diligence and gather any information which is necessary for
making an informed decision, including taking professional advice from a
qualified consultant/technical expert before taking any decision to act upon the
information.
For more information on services offered by SMEDA, please contact our website:
www.smeda.org.pk
SMEDA Services / Information related to PMs Youth Business Loan are FREE OF COST -
2. PURPOSE OF THE DOCUMENT

The objective of the pre-feasibility study is primarily to facilitate potential
entrepreneurs in project identification for investment. The project pre-feasibility
may form the basis of an important investment decision and in order to serve this
objective, the document/study covers various aspects of project concept
development, start-up, and production, marketing, finance and business
management.
The purpose of this document is to facilitate potential investors in meat shop
business by providing them with a general understanding of the business with the
intention of supporting potential investors in crucial investment decisions.
The need to come up with pre-feasibility reports for undocumented or minimally
documented sectors attains greater imminence as the research that precedes
such reports reveal certain thumb rules; best practices developed by existing
enterprises by trial and error, and certain industrial norms that become a guiding
source regarding various aspects of business set-up and its successful
management.
Apart from carefully studying the whole document one must consider critical
aspects provided later on, which form basis of any investment decision.
3. INTRODUCTION TO SMEDA
The Small and Medium Enterprises Development Authority (SMEDA) was
established in October 1998 with an objective to provide fresh impetus to the
economy through development of Small and Medium Enterprises (SMEs).
With a mission "to assist in employment generation and value addition to the
national income, through development of the SME sector, by helping increase
the number, scale and competitiveness of SMEs" , SMEDA has carried out
sectoral research to identify policy, access to finance, business development
services, strategic initiatives, institutional collaboration and networking initiatives.
Preparation and dissemination of prefeasibility studies in key areas of investment
has been a hallmark of SME facilitation by SMEDA.
Concurrent to the prefeasibility studies, a broad spectrum of business
development services is also offered to the SMEs by SMEDA. These services
include identification of experts and consultants and delivery of need based
capacity building programs of different types in addition to business guidance
through help desk services.
4. INTRODUCTION TO SCHEME
Prime Ministers Small Business Loans Scheme, for young entrepreneurs, with
an allocated budget of Rs. 5.0 Billion for the year 2013-14, is designed to provide
subsidised financing at 8% mark-up per annum for one hundred thousand
(100,000) beneficiaries, through designated financial institutions, initially by the
National Bank of Pakistan (NBP) and the First Women Bank Ltd. (FWBL).
Loans from Rs. 0.1 million to Rs. 2.0 million with tenure up to 8 years inclusive of
01 year grace period, and a debt : equity of 90 : 10 will be disbursed to SME
beneficiaries across Pakistan, covering; Punjab, Sindh, Khyber Pakhtunkhwa,
Balochistan, Gilgit Baltistan, Azad Jammu & Kashmir and Federally Administered
Tribal Areas (FATA).
5. EXECUTIVE SUMMARY
The demand for meat is rising with growing population. A number of small shops
are operating in almost every residential and commercial area. However, these
shops seldom follow required cleanliness standards; except for those few
recently introduced in high-income group residential areas. With increasing public
awareness of hygiene, the trend is shifting towards neat / clean hygienically
maintained shops. The proposed outlet is expected to cash on this new trend.
The proposed meat shop would supply hygienically processed, quality mutton
and beef. The shop is proposed to be located in a commercial market of
residential area belonging to middle or upper middle-income group. The
projected products available in the shop will include mutton and beef (with bone
and boneless) minced meat, supplied according to the customers requirement.
The total initial project cost for setting up an outlet is estimated at Rs.1.24 million.
The project is proposed to be financed through 90% debt and 10% equity. The
Net Present Value (NPV) is projected around Rs. 1.10 million with Internal Rate
of Return (IRR) of 42% and payback period of 3.11years. The legal business
status of this project will be Sole Proprietorship.
6. BRIEF DESCRIPTION OF PROJECT & PRODUCT

In this pre-feasibility study, a meat shop is proposed to sell processed mutton
and beef. Growing health concerns among consumers to purchase hygienic
processed meat has opened up new vistas of opportunities for meat shops
offering hygienic meat.
This business involves purchase of carcass of slaughtered animals from a
slaughterhouse. Contract procurement of animal carcass from reliable suppliers
can be an economical alternative. Mutton is bought on number of animal
(carcass) basis; each assumed to have weight of around 12 kgs. Beef is

purchased in multiples of 40 kg units. Particular attention would be paid on the
quality of meat purchased. The meat is then cut into pieces or minced in the shop
according to the customers demand. It is assumed that 85% of beef would be
sold as beef with bones and 15% would be sold as boneless; however, there
would be reduction in weight of meat due to natural phenomenon of water
content evaporation (2% for mutton and 5% for beef). The shop will operate for 8
hours a day for 350 days per annum. The legal status of the proposed project is
recommended to be sole proprietorship.
7. CRITICAL FACTORS
To establish meat shop business successfully, following critical factors must be
considered:
Location of shop, preferably in commercial markets of populated areas.

Ensure good quality of service & supply of clean meat from healthy
animals.
Carcass should have stamps of authorized veterinarians.
Shop should be neat and clean with standard tools and equipment.
The sale of products must be according to the prevailing market price.
8. INSTALLED & OPERATIONAL CAPACITIES

Generally, in this business, installed capacity is reflected by turnover potential in
a given locality, while the shop should be able to store two days inventory
requirement. The inventory requirement is based on bulk purchase orders to
cover transportation cost.
In the proposed business, it is assumed that it would have installed capacity to
sale 4,200 mutton carcass (average 12 kg per mutton carcass) and 1,050
maunds of beef per annum (or daily sale of 12 mutton carcass and 3 maunds of
beef in 350 operational days per annum). However, it would be able to start at 65
% capacity in year one. With the 5% annual increase in capacity, the project
would be able to attain the maximum capacity of 95% in year 10.
9. GEOGRAPHICAL POTENTIAL FOR INVESTMENT

The location of the shop recommended in this pre-feasibility is in a commercial
market of middle or upper middle-income group residential area. For example in
Lahore, localities such as Model Town, Defence, Cavalry, Gulberg, Johar Town,
Garden Town, WAPDA Town, Faisal Town etc. may be considered for setting up
a meat shop. Similarly any major city of Pakistan including Peshawar,
Rawalpindi, Quetta, Karachi and Faisalabad with similar demography is suitable

for this business.
10. POTENTIAL TARGET MARKETS

The target market is middle and upper middle-income group households,
specifically health conscious individuals, who are particular about purchasing
processed meat from hygienic shops.
11. PROJECT COST SUMMARY

A detailed financial model has been developed to analyze the commercial
viability of meat shop under the Prime Ministers Youth Business Loan scheme.
Various cost and revenue related assumptions along with results of the analysis
are outlined in this section.
The projected Income Statement, Cash Flow Statement and Balance Sheet are
attached as appendix
11.1
PROJECT ECONOMICS
The following table shows Internal Rate of Return and payback period;
Table 1: Project Economics
Description
Internal Rate of Return (IRR)
Payback Period (yrs)
Net Present Value (NPV)
Details
42%
3.11
Rs. 1,108,560
Following table provides details of the equity required and variables related to
bank loan;
Table 2: Project Financing
Description
Details
Total Equity (10%)
Rs. 123,980
Bank Loan (90%)
Rs. 1,115,817
Mark-up to the Borrower (%age/annum)
8%
Tenure of the Loan (Years)
8
Grace Period (Years)
1
11.2
PROJECT COST
Following requirements have been identified for operations of the proposed

business.
Table 3: Capital Investment
Description
Building Renovation
Machinery and Equipment
Furniture and Fixture
Office Equipment (Incl. Gen set)
Pre-operating Costs
Total Capital Cost
Upfront Building Rent (6 months)
Cash
Raw Material Inventory (2 days)
Total Working Capital
Total Investment
11.3
Amount in Rs.
169,000
420,800
89,200
66,000
24,273
769,273
243,000
68,443
159,080
470,523
1,239,796
SPACE REQUIREMENT
Following table shows project space requirements and monthly rent;

Table 4: Space Requirement
Space
(sq. ft)
Description
Building rental cost / month
180
Rent
(Rs./ Sq. ft)
225
Monthly
Rent(Rs.)
40,500
The shop is required to be renovated at the following cost;

Table 5: Building Renovation Cost
Description
Shop renovation cost
Neon sign board
Total
Space
(sq. ft.)
180
Cost per unit

(Rs.)
800
25,000
Total Cost (Rs.)
144,000
25,000
169,000
11.4
MACHINERY AND EQUIPMENT
Following table provides list of machinery and equipment for the proposed meat
shop;
Table 6: List of Machinery and Equipment
Rate per Unit
(Rs.)
20,000
2400
Total Amount
(Rs.)
20,000
4,800
3,000
6,000
1
1
80,000
55,000
80,000
55,000
1
1
10,000
200,000
10,000
200,000
45,000
45,000
420,800
Description
Units
Cutting Tools and Equipment

Stainless Steel Meat Chopper
(mutton)
Stainless Steel Meat Chopper
(beef)
Bone Saw Machine (electric)
Mincing Machine with Hopper
(electric)
Weighing Scale
Display Counter Chiller
(2 meter front with 16 display
trays at 4 C temperature)
Freezer (medium size)
Total
Lump sum
2
11.5
OFFICE EQUIPMENT
Following office equipment is required;
Table 7: Office Equipment
Description
Telephones
UPS
Generator Set (2.5 KVA)
Total Office Equipment
Units
Required
1
1
1
Rate per Unit

(Rs.)
1,000
30,000
35,000
Total Amount
(Rs.)
1,000
30,000
35,000
66,000
11.6
FURNITURE AND FIXTURE

Table 8: Furniture and Fixture
Description
Bracket fans
Lights
Benches for customers
Air-conditioners (2 ton split)
Total
11.7
Units
Cost per Unit

(Rs.)
2
12
2
1
2,500
350
5,000
70,600
Total
Amount
(Rs.)
5,000
4,200
10,000
70,600
89,800
RAW MATERIAL REQUIREMENTS
Raw material required for meat shop in first year of project is as follow;
Table 9: Raw Material Requirements in Year 1
Weight
Meat per
Total
Quantity
Rate
Description
per unit
Annum
Amount
(Kg)
(Rs./Kg)
(Kg)
(Kg)
(Rs.)
Mutton procurement
12
2,730
32,760
580 19,000,800
(in carcass)
Beef procurement
40
682.5
27,300
300
8,190,000
(in maund)
Total
27,190,800
11.8
HUMAN RESOURCE REQUIREMENT
Following trained human resources are required to run a meat shop;

Table 10: Human Resource Requirement
Description
Owner/ Manager
Butchers
Total
No. of Employees
1
*2
3
Monthly Salary (Rs.)

20,000
18,000
*It is assumed that one trained butcher would handle and process average 100 kgs of meat per
day 35,000 kgs per annum per person.
11.9
REVENUE GENERATION
Table11: Revenue Generation
Description
*Mutton sale
*Beef boneless sale
(15% of total beef)
*Beef with bone sale
(85% of total beef)
Total
Sale Price
*Quantity (Kg)
(Rs. / Kg)
650
32,104.80
Revenue in First
Year (Rs.)
20,868,120
380
3,890.25
1,478,295
320
22,044.75
7,054,320
29,400,735
* The reduction in weight of meat due to water evaporation and loss is assumed to be
2% for mutton and 5% for beef.
The sale price growth rate is assumed to be 10% per annum.
11.10
OTHER COSTS
The essential cost to be borne by the shop is direct electricity and water which is
assumed to be Rs. 420,000 and Rs. 12,000 per annum respectively. The per
annum expense for transportation, communication and promotion is assumed to
be Rs 175,000, Rs. 18,000 and Rs. 14,700 respectively in first year of project.
The expense for maintenance of machinery is assumed to be Rs. 36,000 per
annum.
For miscellaneous (incl. repair and maintenance of tools) and packaging
(polythene bags) expenses, Rs. 36,000 and Rs. 58,040 per annum are allocated
in project.
10
12.
CONTACTS
OF SUPPLIERS AND CONSULTANTS
Table 12: Contacts of Suppliers and Consultants

Experts
Dr. Muhammad Abdullah
Dean, Faculty of Animal Production
University of Veterinary & Animal
Sciences, Lahore
Ph: 042 - 99211374
Experts
Prof. Dr. Muhammad Younas
Department of Livestock Management
Faculty of Animal Husbandry
University of Agriculture
Faisalabad, Pakistan
Ph: 041-9200161-170
Mr. M. Younus Qureshi

Red Cow Meat Training Institute
125/13-B1, Township, Lahore
Ph: 042-35112603
Director General (Extension)

Livestock
&
Dairy
Development
Department (L&DD), Govt. Of Punjab, 16Cooper Road, Lahore,
Ph: 042-99201117
Punjab Agriculture and Meat Company

(PAMCO), 5/8 Shaheen Complex,
Egerton Road Lahore
Ph: 042-36370661
11
Pre-feasibility Study
13.
ANNEXURE
13.1
INCOME STATEMENT
Statement Summaries
SMEDA
Income Statement
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Rs. in actuals
Year 10
29,400,735
27,839,040
1,561,695
33,957,849
32,164,830
1,793,019
39,221,316
37,163,218
2,058,098
45,300,619
42,938,813
2,361,807
52,322,215
49,612,497
2,709,718
60,432,159
57,323,956
3,108,203
69,799,143
66,234,599
3,564,544
80,618,011
76,530,945
4,087,066
92,110,665
87,498,804
4,611,860
101,321,731
96,331,279
4,990,453
240,000
486,000
420,000
18,000
14,700
66,050
4,855
36,000
1,285,605
276,090
276,000
534,600
462,000
19,800
16,979
66,050
4,855
39,600
1,419,884
373,135
317,400
588,060
508,200
21,780
19,611
66,050
4,855
43,560
1,569,515
488,583
365,010
646,866
559,020
23,958
22,650
66,050
4,855
47,916
1,736,325
625,482
419,762
711,553
614,922
26,354
26,161
66,050
4,855
52,708
1,922,363
787,355
482,726
782,708
676,414
28,989
30,216
66,050
57,978
2,125,081
983,122
555,135
860,979
744,056
31,888
34,900
66,050
63,776
2,356,783
1,207,761
638,405
947,077
818,461
35,077
40,309
66,050
70,154
2,615,532
1,471,534
734,165
1,041,784
900,307
38,585
46,055
66,050
77,169
2,904,116
1,707,744
844,290
1,145,963
990,338
42,443
50,661
66,050
84,886
3,224,631
1,765,822
Other income
Earnings Before Interest & Taxes
276,090
373,135
488,583
625,482
787,355
983,122
1,207,761
1,471,534
1,707,744
1,765,822
Interest expense
Earnings Before Tax
92,612
183,478
84,787
288,348
74,503
414,080
63,365
562,117
51,303
736,052
38,239
944,882
24,091
1,183,670
8,769
1,462,765
1,707,744
1,765,822
Tax
NET PROFIT/(LOSS) AFTER TAX
183,478
288,348
1,408
412,672
16,212
545,905
33,605
702,447
64,232
880,650
100,050
1,083,620
141,915
1,320,850
189,049
1,518,696
200,664
1,565,158
Balance brought forward

Total profit available for appropriation
Balance carried forward
183,478
183,478
183,478
471,826
471,826
471,826
884,497
884,497
884,497
1,430,402
1,430,402
1,430,402
2,132,849
2,132,849
2,132,849
3,013,500
3,013,500
3,013,500
4,097,119
4,097,119
4,097,119
5,417,970
5,417,970
5,417,970
6,936,665
6,936,665
6,936,665
8,501,823
8,501,823
Revenue
Cost of goods sold
Gross Profit
General administration & selling expenses
Administration expense
Rental expense
Utilities expense
Travelling & Comm. expense (phone, fax, etc.)
Office expenses (stationary, etc.)
Promotional expense
Depreciation expense
Amortization expense
Miscellaneous expense
Subtotal
Operating Income
12
13.2
BALANCE SHEET
Statement Summaries
SMEDA
Balance Sheet
Year 0
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Rs. in actuals
Year 10
Assets
Current assets
Cash & Bank
Pre-paid building rent
Total Current Assets
274,647
40,500
470,523
482,950
44,550
724,906
660,441
49,005
960,249
937,081
53,906
1,309,632
1,316,975
59,296
1,781,111
1,817,495
65,226
2,397,069
2,448,084
71,748
3,173,312
3,229,208
78,923
4,138,376
4,195,071
86,815
5,325,349
5,552,008
95,497
6,910,095
8,541,303
8,541,303
Fixed assets
Building/Infrastructure
Furniture & fixtures
Office equipment
Total Fixed Assets
169,000
89,200
66,000
745,000
160,550
80,280
59,400
678,950
152,100
71,360
52,800
612,900
143,650
62,440
46,200
546,850
135,200
53,520
39,600
480,800
126,750
44,600
33,000
414,750
118,300
35,680
26,400
348,700
109,850
26,760
19,800
282,650
101,400
17,840
13,200
216,600
92,950
8,920
6,600
150,550
84,500
84,500
24,273
24,273
1,239,796
19,419
19,419
1,423,274
14,564
14,564
1,587,713
9,709
9,709
1,866,192
4,855
4,855
2,266,765
2,811,819
3,522,012
4,421,026
5,541,949
7,060,645
8,625,803
Intangible assets
Pre-operation costs
Total Intangible Assets
TOTAL ASSETS
Liabilities & Shareholders' Equity
Current liabilities
Short term debt
Total Current Liabilities
Other liabilities
Deferred tax
Long term debt
Total Long Term Liabilities
1,115,817
1,115,817
1,115,817
1,115,817
991,908
991,908
857,715
857,715
712,383
712,383
554,990
554,990
384,532
384,532
199,927
199,927
Shareholders' equity
Paid-up capital
Retained earnings
Total Equity
TOTAL CAPITAL AND LIABILITI
123,980
123,980
1,239,796
123,980
183,478
307,458
1,423,274
123,980
471,826
595,805
1,587,713
123,980
884,497
1,008,477
1,866,192
123,980
1,430,402
1,554,382
2,266,765
123,980
2,132,849
2,256,829
2,811,819
123,980
3,013,500
3,137,479
3,522,012
123,980
4,097,119
4,221,099
4,421,026
123,980
5,417,970
5,541,949
5,541,949
123,980
6,936,665
7,060,645
7,060,645
123,980
8,501,823
8,625,803
8,625,803
Note: Total assets value will differ from project cost due to first installment of leases paid at the start of year 0
-
13
13.3
CASH FLOW STATEMENT

-
Statement Summaries
SMEDA
Cash Flow Statement
Operating activities
Net profit
Add: depreciation expense
amortization expense
Deferred income tax
Pre-paid building rent
Cash provided by operations
Year 0
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
(40,500)
(195,876)
183,478
66,050
4,855
(4,050)
208,303
288,348
66,050
4,855
(4,455)
301,400
412,672
66,050
4,855
(4,901)
410,834
545,905
66,050
4,855
(5,391)
525,225
702,447
66,050
4,855
(5,930)
657,913
880,650
66,050
(6,523)
801,046
1,083,620
66,050
(7,175)
965,729
1,320,850
66,050
(7,892)
1,165,790
1,518,696
66,050
(8,682)
1,356,937
(123,909)
(123,909)
(134,193)
(134,193)
(145,331)
(145,331)
(157,394)
(157,394)
(170,457)
(170,457)
(184,605)
(184,605)
(199,927)
(199,927)
Financing activities
Change in long term debt
Change in short term debt
Issuance of shares
Cash provided by / (used for) financ
1,115,817
123,980
1,239,796
Investing activities
Capital expenditure
Cash (used for) / provided by invest
(769,273)
(769,273)
Rs. in actuals
Year 10
1,565,158
66,050
95,497
2,989,295
NET CASH
274,647
208,303
177,491
276,640
379,894
500,519
630,589
781,124
965,863
1,356,937
2,989,295
Cash balance brought forward

Cash available for appropriation
Cash carried forward
274,647
274,647
274,647
482,950
482,950
482,950
660,441
660,441
660,441
937,081
937,081
937,081
1,316,975
1,316,975
1,316,975
1,817,495
1,817,495
1,817,495
2,448,084
2,448,084
2,448,084
3,229,208
3,229,208
3,229,208
4,195,071
4,195,071
4,195,071
5,552,008
5,552,008
5,552,008
8,541,303
8,541,303
14
13.4
USEFUL PROJECT MANAGEMENT TIPS
Technology
List of Machinery &Equipment (As per Section 11.4)
List of Office Equipment(As per section 11.5)
Required spare parts & consumables: Suppliers credit agreements and

availability as per schedule of maintenance should be ensured before start of
operations
Energy Requirement: Should not be overestimated or installed in excess and

alternate source of energy for critical operations be arranged in advance
Machinery Suppliers: Should be asked for training and after sales services
under the contract
Quality Assurance Equipment & Standards: Quality standards need to be

defined and a mechanism to check them should be developed for improving
quality
Marketing
Product Development & Packaging: Experts help may be sought for product /
service and design & development
Advertisement & Promotion: Business promotion and dissemination through

banners and launch events is highly recommended. Product brochures should be
developed from good quality service providers.
Sales & Distribution Network: Experts advice and distribution agreements

should be sought for developing the sales and distribution network.
Price / Bulk Discounts, Cost Plus Introductory Discounts: Pricing decisions

should never compromise quality of the products. Price during introductory phase
may be kept lower and used as promotional tool. Product cost estimates should
be carefully documented before price setting. Government controlled prices need
to be displayed, as required.
Human Resources
List of Human Resource Required (As per section 11.8)
Adequacy & Competencies: Skilled and experienced staff should be considered

an as assets of the business and investments should be made in developing and
motivating them through various means and incentives.
Performance Based Remuneration: Efforts to manage human resource cost

should be focused through performance measurement and performance based
compensation.
15
Training & Skill Development: Encouraging training and skill development of

self & employees through experts and exposure to best practices helps in
continuous improvement in the business. Least cost options for Training and Skill
Development (T&SD) should be developed and linked with compensation benefits
and awards.
13.5
USEFUL LINKS
Prime Ministers Office, www.pmo.gov.pk

Small & Medium Enterprises Development Authority (SMEDA),
www.smeda.org.pk
Government of Pakistan, www.pakistan.gov.pk
Ministry of Industries & Production, www.moip.gov.pk
Ministry of National Food Security & Research, www.mnfsr.gov.pk
Ministry of Education, Training & Standards in Higher Education,
www.moptt.gov.pk
Government of Punjab, www.punjab.gov.pk
Government of Sindh, www.sindh.gov.pk
Government of Khyber Pakhtunkhwa, www.khyberpakhtunkhwa.gov.pk
Government of Balochistan, www.balochistan.gov.pk
Government of Gilgit Baltistan, www.gilgitbaltistan.gov.pk
Government of Azad Jammu & Kashmir, www.ajk.gov.pk
Trade Development Authority of Pakistan (TDAP), www.tdap.gov.pk
Securities & Exchange Commission of Pakistan (SECP), www.secp.gov.pk
Federation of Pakistan Chambers of Commerce and Industry (FPCCI)
www.fpcci.com.pk
Punjab Board of Investment & Trade (PBIT), 23-Aikman Road, GOR-I, Lahore
Tel. 042-99205201, www.pbit.gop.pk
Sindh Board of Investment (SBI), 1st Floor, Tower B, Finance & Trade Center,
Shahra-e-Faisal, Karachi, Tel. 021-99207512-4, www.sbi.gos.pk
State Bank of Pakistan (SBP), www.sbp.org.pk
National Bank of Pakistan (NBP), www.nbp.com.pk
First Women Bank Limited (FWBL), www.fwbl.com.pk
All Pakistan Meat Exporters and Processors Association, Lahore,
www.apmepa.com
National Vocational and Technical Training Commission (NAVTTC) Head
Quarter, Islamabad, www.navttc.org
Red Cow Meat Training Institute, www.rcmti.edu.pk
Halal Research Council, 192- Ahmad Block, New Garden Town, Lahore, Tel:
0423-5913227-8, www.halalrc.org
Punjab Agriculture and Meat Company (PAMCO), Lahore, www.pamco.bz
16
Pakistan Agricultural Research Council (PARC), Islamabad Tel. 051-9203966

www.parc.gov.pk
National Agricultural Research Centre (NARC), Islamabad Tel. 051-9255061,
www.parc.gov.pk
University of Agriculture, Faisalabad, www.uaf.edu.pk
Lasbela University of Agriculture, Water & Marine Sciences,
Lasbelawww.luawms.edu.pk
Sindh Agriculture University, Tondojam, www.sau.edu.pk
Gomal College of Veterinary Sciences, Dera Ismail Khan, www.gu.edu.pk
KPK Agricultural University, Peshawar, www.aup.edu.pk
PirMehr Ali Shah Arid Agricultural University, Rawalpindi, www.uaar.edu.pk
University College of Veterinary & Animal Sciences, Islamia University
Bahawalpur (IUB), www.iub.edu.pk
University of Veterinary & Animal Sciences (UVAS), Lahore, www.uvas.edu.pk
BahauddinZakariya University (BZU), Multan, www.bzu.edu.pk
Agribusiness Support Fund (ASF), Lahore, www.asf.org.pk
Directorate of Livestock Farms, L&DD, Lahore, Tel: 042-99201126-7
Livestock & Fisheries Department, Government of Sindh, www.sindh.gov.pk
Agriculture & Livestock Department, Government of KPK,
www.khyberpakhtunkhwa.gov.pk
Livestock & Dairy Development, Government of Balochistan,
www.balochistan.gov.pk
17
14.
KEY ASSUMPTION
Table 13: Operational Assumptions
Mutton
Mutton (Maximum number of carcass)
Average meat per carcass (kgs)
Beef
Beef in maund
No. of kg per maund
% of boneless beef in total beef
% of with bone beef in total beef
Days operational per year
Capacity utilization in first year
Production capacity utilization growth rate per annum
Maximum capacity utilization (year 10)
4,200
12
1,050
40
15%
85%
350
65%
5%
95%
Table 14: Revenue Assumptions

Sales price
Mutton
Boneless beef
Beef with bone
Sales price growth rate
Rs. 650
Rs. 380
Rs. 320
10%
Table 15: Expense Assumptions

Communication expense (per month)
Miscellaneous expense (per month)
Transportation expense (per day)
Promotional expense (% of revenue)
Rs. 1,500
Rs. 3,000
Rs. 500
0.05%
18

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Pre-Feasibility Study

Small and Medium Enterprises Development Authority

3rd Floor, Building No. 3,

5th Floor, Bahria

Bungalow No. 15-A

CONTACTS OF SUPPLIERS AND CONSULTANTS ...............................................................11

PROJECT ECONOMICS ................................................................................................................... 6

INCOME STATEMENT ............................................................................................................12

(Meat Shop Rs.1.24 Million)

This information memorandum is to introduce the subject matter and provide a

(Meat Shop Rs.1.24 Million)

2. PURPOSE OF THE DOCUMENT

(Meat Shop Rs.1.24 Million)

6. BRIEF DESCRIPTION OF PROJECT & PRODUCT

(Meat Shop Rs.1.24 Million)

(carcass) basis; each assumed to have weight of around 12 kgs. Beef is

Location of shop, preferably in commercial markets of populated areas.

8. INSTALLED & OPERATIONAL CAPACITIES

9. GEOGRAPHICAL POTENTIAL FOR INVESTMENT

(Meat Shop Rs.1.24 Million)

Rawalpindi, Quetta, Karachi and Faisalabad with similar demography is suitable

10. POTENTIAL TARGET MARKETS

11. PROJECT COST SUMMARY

(Meat Shop Rs.1.24 Million)

Following requirements have been identified for operations of the proposed

Following table shows project space requirements and monthly rent;

The shop is required to be renovated at the following cost;

Cost per unit

Total Cost (Rs.)

(Meat Shop Rs.1.24 Million)

MACHINERY AND EQUIPMENT

Cutting Tools and Equipment

Following office equipment is required;

Table 7: Office Equipment

Rate per Unit

(Meat Shop Rs.1.24 Million)

FURNITURE AND FIXTURE

Cost per Unit

RAW MATERIAL REQUIREMENTS

HUMAN RESOURCE REQUIREMENT

Following trained human resources are required to run a meat shop;

Monthly Salary (Rs.)

(Meat Shop Rs.1.24 Million)

The sale price growth rate is assumed to be 10% per annum.

(Meat Shop Rs.1.24 Million)

OF SUPPLIERS AND CONSULTANTS

Table 12: Contacts of Suppliers and Consultants

Mr. M. Younus Qureshi

Director General (Extension)

Punjab Agriculture and Meat Company

(Meat Shop Rs.1.24 Million)

Balance brought forward

(Meat Shop Rs.1.24 Million)

(Meat Shop Rs.1.24 Million)

CASH FLOW STATEMENT

Cash Flow Statement

Cash balance brought forward

(Meat Shop Rs.1.24 Million)

USEFUL PROJECT MANAGEMENT TIPS

List of Machinery &Equipment (As per Section 11.4)

List of Office Equipment(As per section 11.5)

Required spare parts & consumables: Suppliers credit agreements and

Energy Requirement: Should not be overestimated or installed in excess and

Quality Assurance Equipment & Standards: Quality standards need to be