FAST FOOD PARLOUR

A. INTRODUCTION:
In the present day world, people are heading towards fast food restaurants,
for the purpose of snacking. Fast food is selling like real hot cakes especially
amongst the younger generation. Though fast food is not a very healthy
option to go in for, still people are opting for it because today fast foods have
become an integral part of fad trend.

The Hoteliers claim that their food prices are fixed not to make any
substantial profit but just to make both ends meet. Their overhead costs
are high. In fast food restaurant, the overheads can be kept to the
minimum, and the prices of the food served can be kept low due to low
labour force and low overheads, and other minimum infrastructure like
furniture etc.

Considering the growth in floating population in the cities and fast moving
life people prefer to spend bare minimum time in the restaurants. In this
context, fast food parlors are the most suitable alternative.

B. PRODUCT USES & SPECIFICATIONS:

There is no product specification for fast food restaurant. The standards are
determined by ultimate consumers who are regular visitors to a restaurant.

C. MARKET POTENTIAL:
The proposed parlour should be in a central place, so that it can cater to the
requirements of middle class, and other upper and lower middle income
groups. The motto of the parlour should be to maintain a high standard of
food and warm and quick service to the customs at affordable rates. The
project should be conceived with the aim of providing basic necessities to
the customers. All South Indian vegetarian dishes and other fast moving
north Indian dishes should be provided to the customers.
D. TECHNICAL ASPECTS:

1. Plant & Machinery :

In order to provide adequate facilities the following equipments and
furniture are required to be maintained.
Nos
1. Steam Boiler SBC 6 1
2. Diesel Burner Blower 1
3. Rice Cooking Vessel 10 kg. 1
4. Hall/Veg. Vessel 10 kg. 1
5. Idly Cooking Plant IP 100 1
6. Gas Cooking Range 3 in 1 1
7. Gas Cooking Range 2 in 1 1
8. Dosaplate 4 x 21/2 x 34” 1
9. Workable with 3 shelves 6
10. Wortable with sink 1
11. Washing sink 3 in 1 1
12. Dish handling table 1
13. Cleansing Rack 4 in 1 2
14. Wet grinder 10 ltrs. 1
15. Wet grinder 5 ltrs. 1
16. Dirty Collection trolly 2
17. Deepfreezer 3 doors 1
18. Pipeline valve fittings LS
19. Aluminium Glading LS
20. Paw Bajji Counter 1
21. Bhel puri counter 1
22. Samosa hotcase 1
23. Juice counter 1
24. 8 hole hotcase 1
25. 2 hole hotcase 1
26. Service counter with 7 hole bainmarie 1
27. Potato peeler 1
28. Milk Boiler 1
 29. Salamander 1
GAS LINE:
1. Supply of Gas Line
2. Supply of Exhaust Hood with all accessories
3. Electricals & Furnitures
All the equipments are proposed to be purchased from reputed
suppliers of these equipments, who have experience in supplying
similiar items to various hotel.

3. Facilities to be provided :
The parlour should provide the following facilities
• Morning Tea/Coffee
• Breakfast
• Mini Lunch
• Evening Tea/Coffee
• Snacks
Also fast moving North Indian dishes like Bhel Puri, Pani Puri, Bread
Channa etc. Should also be provided.

4. Raw Materials :
The materials required for hotel are general provisions, consumables,
groceries and vegetables. These can be purchased on daily and
weekly basis. No finance is required for storing these items.
5. Land & Building:
Building required 300 sqft. Rented.

6. Utilities:
Electricity : Power requirement is Rs.3000/- per
month.

Steam : For Idli and other cooking purposes.

Water : Water is required for cooking,

washing and consumption.
 Effluent treatment : No harmful effluents envisaged.
Man Power Requirement:
Production Rs./Mont Total
h
1. Cooks 3 4000 12000
2. Assistants 3 3000 9000
3. Waiters 10 3000 30000
4. Supervisors 2 5000 10000
5. Cleaners 3 2500 7500
68500
Add: Benefits 20% 13700
Total 82200
Annually Rs.9.86 lakhs.
Administrative
1. Manager 1 7000 7000
Add: Benefits 20% 1400

Total 8400
Annually Rs.1.01 lakh.

7. IMPLEMENTATION SCHEDULE:
The machines are available from the suppliers indigenously. The project
can be implemented within a month.

8. ASSUMPTIONS
1. Sales per day at 100% Rs.24000 Sales per annumRs.84.00 lakhs

2. Occupancy/Utilsation Year1-60%, Year2-70%and Year3-80%

3. Material cost 50 % of the sales revenue

4. Power charges Rs.5000 per month

5. Repairs and Maintenance Rs.36000 per annum

6. Depreciation normal rates at written down value method

7. Administration and general expenses Rs.12000 per month.

8. Interest on Term Loan 12% p.a.

9. Income tax is provided at 33.99% on taxable income.

LIST OF MACHINERY & EQUIPMENT SUPPLIERS:

1. ARV Engineering Industries Pvt. Ltd., No.6, Amaravathi Nagar Main Road,

Kurinji, Arumbakkam, Chennai 600106.

2. M/s.Classic Canteen Systems, PK5, Sidco Industrial Estate,

Ekkattuthangal, Chennai - 600 097.

3. M/s.Micro Engineering Works, 32, Teynampet Ramasamy Mudali Street,

Chennai 600106.

FINANCIAL ASPECTS
1. COST OF PROJECT [Rs.lakhs]
Land & Building (Advance) 0.50
Equipment & Furniture 11.00
Pre-Operative expenses 0.50
Margin for WC 0.50
Total 12.50
2. MEANS OF FINANCE
Capital 4.50
Term Loan 8.00
Total 12.50

3. COST OF PRODUCTION & PROFITABILITY STATEMENTS [Rs.lakhs]

Details of Income:
Rate assumed per hour Rs.1,500
No. of hours per day 16 hours
Income per day Rs.24,000
No. of days p.a. 350 days
Income per annum (Rs.lakhs) Rs.84.00 lakhs
Years 1 2 3
Income per annum -100% (Rs.lakhs) 84.00 84.00 84.00
Utilisation 60% 70% 80%
Income per annum 50.40 58.80 67.20
Raw Materials 25.20 29.40 33.60
Power 0.60 0.42 0.48
Wages & Salaries 10.87 11.41 11.98
Repairs & Maintenance 0.36 0.40 0.44
Depreciation 1.65 1.40 1.19
Cost of Production 38.68 43.03 47.69
Admin. & General expenses 1.44 1.51 1.59
Selling expenses 0.00 0.00 0.00
Interest on Term Loan 0.96 0.84 0.60
Interest on Working Capital 0.00 0.00 0.00
Total 41.08 45.38 49.88
Profit Before Tax 9.32 13.42 17.32
Provision for tax 3.17 4.56 5.89
Profit After Tax 6.15 8.86 11.43
Add: Depreciation 1.65 1.40 1.19
Cash Accruals 7.80 10.26 12.62

4. WORKING CAPITAL:

Months Values % Margin Bank

Consumptions Amount Finance
Expenses 1.00 0.50 100% 0.50 0.00
0.50 0.50 0.00

6. PROFITABILITY RATIOS BASED ON 80% UTILISATION

Profit after Tax 11.43
= 17%
Sales 67.20
Profit before Interest and Tax 17.92
= 143%
Total Investment 12.50
Profit after Tax 11.43
= 254%
Promoters Capital 4.50

7. BREAK EVEN LEVEL

Fixed Cost (FC): [Rs.lakhs]
Wages & Salaries 11.98
Power 0.48
Repairs & Maintenance 0.44
Depreciation 1.19
Admin. & General expenses 1.59
Interest on TL 0.60
16.28
Profit Before Tax (P) 17.32
BEL FC x 100 16.28 80
= x x 100
= FC +P 33.60 100
39% of installed capacity