Wine mnfng


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Wine mnfng

  1. 1. A Project Report On “Wine manufacturing” Submitted by: Mr. Deshmane Vikas G. M.B.A. 3rd Sem Guided by Lect. Noorin Panjwani SUBMITTED TOInstitute Of Technology & Management Nanded. UNDER TOSwami Ramand Teerth Marathwada University, Nanded 2011 - 2012
  2. 2. CERTIFICATE This is to certify that Mr.Deshmane Vikas G. Has submitted a project report on SMALL-SCALE INDUSTRIES OF “Wine Manufacturing” And has been successfully completed the project in MBA.III semester ofInstitute of Technology & Management studies under Swami Ramanand TeerthMaratwada, University and in this volume he has submitted a satisfactory reportabout it, during the academic year 2011-2012. Lect.Noorin Panjwani (Project Guide)
  3. 3. ACKNOWLEDGEMENT With great pleasure, I wish to express my deep sense of gratitude towardsDr.S.B.Thorat Sir Director of “ITM college”, for his constant interest &guidance. I must take this opportunity to record my thanks to Lect. N.D.Shinde Sir(HOD) & all other staff members who have directly or indirectoly helped meduring Project Report on “WINE MANUFACTURING”. I take this opportunity to express my particular appreciation to my projectguide Lect. Noorin Panjwani who provided me valuable information andguideline about the project from time , without which it would have been verydifficult to complete the task. I wish to thanks my parents, friends for their constant support and guidance forfulfilling this project Report. Mr.Deshmane Vikas G. MBA 3rd Sem
  4. 4. DECLARATION I, hearby decalar that the project titled “Wine Manufacturing”carried out by me under guidance & supervision Lect.Noorin PanjwaniInstitute of Technology & Management Nanded studies under Swami RamanandTeerth Maratwada University, Nanded is an original & bonafied projectwork & is not submitted earlier for the award of any degree or diplomaeither inpart or in full this or any other universityPlace: - Nanded Mr. Deshmane Vikas G.Date: - 15/11/2011 MBA 3rd Sem
  7. 7. INTRODUCTION Wine is an alcoholic beverage made by fermentation of grapes or grape juice. It is the mostpopular beverage, associated with happiness, celebrations and festivities. Global market for wineis estimated at 25 billion liters. Many varieties of wines are made throughout the world. French wines are most popular.The general classification of wines refers to red wines (made from sugar cane without removingthe skins), white wines (made from grape juice) and sparkling wines. The alcohol content inwine varies from 10 to 14 %. Wine like beverages can also be made from other fruits and grains. These beverages are alsoreferred to as wines, with a prefix or suffix. Eg. Apple wine.Compared to other countries, wine manufacture and consumption in India isInsignificant. This is attributed to earlier period of prohibition in the country and higher Pricecompared to spirits like whisky and brandy manufactured in the country, referred to as Indianmade liquors. Wine manufacture on organized scale commenced in India with the setting up ofChampagne Indag`s plant in 1984 in the state of Maharashtra.Few more units have come up after that. The wine manufacturing units are located in Nandeddistrict of Maharastra state as the climate there is found to be most suitable for grapes used forwine making. The Indian wine industry has been steadily growing over the last ten years. Wine is graduallybecoming a part of urban Indian life style. Rising incomes of Indian population, changingdemography and exposure to new culture is adding to the higher consumption. The market forwine is expected to grow at over 20 % per annum. This scenario is promising to newmanufacturing units.
  8. 8. VISION OF THE PROJECT:- “Wines the pre-eminent supplier to the global marketplace. One of Wine Visions key strategie is to make wine an integral part of Indian Culture”.MISSION OF THE PROJECT:- To provide jobs to skillful employees. To develop the economy of the region. To obtain maximum growth with minimum investment. To use the modern technology to the wine mfg. industries.SELECTION OF THE PROJECTS:-The main reasons that encourage me to select this project are given as follows as 1. The main raw materials for the industry, i.e. sugarcane & other fruit easily available in city. 2. The employees and labor are easily available.MARKET POTENTIAL AND COMPETITION:- Today, the wine Industries is growing in India very vastly and it requires newbusinessman great opportunity in this field.
  9. 9. COMPETITOR:- Deccan Bottling And Industries Pvt Ltd. Pralhad Agencies Wine Shop.COMPANY LOGO:- ROYAL WINE MANUFACTURINGMARKETING CHANNELS:-The marketing channels plays important role in the distribution of the products to reach thepotential customers. The selection of the marketing channels is also important .so choose mymarketing channels as follows asLEGAL FORMALITIES:-For the starting a SSI unit, every unit has some legal formalities to complete for starting a newbusiness or to dissolve any industries. Here depicted some legal aspects which are necessary tobe completed by entrepreneurs. 1. No objection letters Director of industries. 2. Approval letter from Director of industries. 3. Power sanction assurance letter from Mahavitaran. 4. Certification of water supply. 5. Application for Telephone. 6. S.S.I Unit Registration. 7. Registration for sales Tax. 8. Registration of central Sales Tax. 9. Application for loan to State Bank of India. 10. Certificate from industrial pollution Office.
  10. 10. PRODUCTION MANAGEMENT:-PLANT LOCATION AND SIZE OF THE UNIT:The plant is located at following address:- A-55, M.I.D.C. NANDED DIST –NANDED STATE- MAHARASTRA PIN CODE- 431606From the purely economic point of view manufacturing unit should be located at the place whichcan secure the maximum economics of production and distribution.Industrial Production Requires1] MACHINERY AND EQUIPMENT2] SKILLED MANPOWER3] MANAGEMENT.4] ENERGY.5] BANKING FACILITIES.6] MARKETING FACILITIES.7] COMMUNICATION FACILITIES.8] TRANSPORT SERVICES.Hence all the facilities are available at MIDC, Nanded. The site of unit requires approximately1500 sq. Mt. Area for production proposes therefore production unit is at MIDC Nanded.
  11. 11. The Factors Influenced to choose the plant-layout are as follows:- 1. Availability of raw materials:- All the traders of the sugar cane & other fruit are within 10 Km. from factory. The transportation cost is also very less. 2. Availability of skilful labour force:- The engineers and fitter, Welders are easily available as many Technical Institutes are here. 3. Good transportation facilities:- The place is well connected to the Nanded Aurangabad road. The place only 08 K.M away from the Nanded railway station. It is located just 10 kms. From Nanded airport, this has direct flights to Mumbai and Delhi. 4. Availability of the power and water supply: The power supplied by the Maharashtra State Electricity Board (MSEB), at the rate of Rs.4.25 for the commercial use. The water is available from the natural sources like ponds and rivers.
  12. 12. PICTORIAL REPRESENTATION OF THE PLANT LAY OUT:-Entry gate Office Exit gate CanteenIInventories store Open spaceToilets Workshop Scrap room
  13. 13. RAW MATERIALS AND THEIR USES:-As mentioned above, the wine sugar cane itself contains all the necessary ingredients for wine:pulp, juice, sugars, acids, tannins, and minerals. However, some manufacturers add yeast toincrease strength and cane or beet sugar to increase alcoholic content. During fermentation,winemakers also usually add sulfur dioxide to control the growth of wild yeasts. The main rawmaterial required in wine manufacturing is fruits. But other materials also play a vital role whichis as follows:- 1) Sugar Cane 2) Apples 3) Blackberries 4) Grapes 5) Honey 6) Milk 7) Rice 8) Wheat 9) Potatoes 10) Rye 11) Packing Material
  14. 14. The Manufacturing Process:-The process of wine production has remained much the same throughout the ages, but newsophisticated machinery and technology have helped streamline and increase the output of wine.Whether such advances have enhanced the quality of wine is, however, a subject of debate.These advances include a variety of mechanical harvesters, grape crushers, temperature-controlled tanks, and centrifuges.The procedures involved in creating wine are often times dictated by the Sugar Cane and theamount and type of wine being produced. Recipes for certain types of wine require thewinemaker (the vintner) to monitor and regulate the amount of yeast, the fermentation process,and other steps of the process. While the manufacturing process is highly automated in medium-to large-sized wineries, small wineries still use hand operated presses and store wine in mustywine cellars.A universal factor in the production of fine wine is timing. This includes picking Sugar Cane atthe right time, removing the must at the right time, monitoring and regulating fermentation, andstoring the wine long enough.The wine-making process can be divided into four distinct steps: harvesting and crushing SugarCane; fermenting must; ageing the wine; and packaging.
  15. 15. Harvesting and Crushing Grapes:-1. Vineyardists inspect sample clusters of wine grapes with a refractometer to determine if thegrapes are ready to be picked. The refractometer is a small, hand-held device (the size of aminiature telescope) that allows the vineyardist to accurately check the amount of sugar in thegrapes.2. If the grapes are ready for picking, a mechanical harvester (usually a suction picker) gathersand funnels the grapes into a field hopper, or mobile storage container. Some mechanicalharvesters have grape crushers mounted on the machinery, allowing vineyard workers to gathergrapes and press them at the same time. The result is that vineyards can deliver newly crushedgrapes, called must, to wineries, eliminating the need for crushing at the winery. This alsoprevents oxidization of the juice through tears or splits in the grapes skins.Mechanical harvesters, or, in some cases, robots, are now used in most medium to largevineyards, thereby eliminating the need for hand-picking. First used in California vineyards in1968, mechanical harvesters have significantly decreased the time it takes to gather grapes. Theharvesters have also allowed grapes to be gathered at night when they are cool, fresh, and ripe.3. The field hoppers are transported to the winery where they are unloaded into a crusher-stemmer machine. Some crusher-stemmer machines are hydraulic while others are driven by airpressure.The grapes are crushed and the stems are removed, leaving liquid must that flows,Once at the winery, the grapes are crushed if necessary, and the must is fermented, settled,clarified, and filtered. After filtering, the wine is aged in stainless steel tanks or wooden vats.White and rose wines may age for a year to four years, or far less than a year. Red wines mayage for seven to ten years. Most large wineries age their wine in large temperature-controlledstainless steel tanks that are above ground, while smaller wineries may still store their wine inwooden barrels in damp wine cellars.either into a stainless steel fermentation tank or a wooden vat (for fine wines).
  16. 16. Fermenting the must:-4. For white wine, all the grape skins are separated from the "must" by filters or centrifugesbefore the must undergoes fermentation. For red wine, the whole crushed grape, including theskin, goes into the fermentation tank or vat. (The pigment in the grape skins give red wine itscolor. The amount of time the skins are left in the tank or vat determines how dark or light thecolor will be. For rose, the skins only stay in the tank or vat for a short time before they arefiltered out.)5. During the fermentation process, wild yeast are fed into the tank or vat to turn the sugar in themust into alcohol. To add strength, varying degrees of yeast may be added. In addition, cane orbeet sugar may be added to increase the alcoholic content. Adding sugar is call capitalization.Usually capitalization is done because the grapes have not received enough sun prior toharvesting. The winemaker will use a handheld hydrometer to measure the sugar content in thetank or vat. The wine must ferments in the tank or vat for approximately seven to fourteen days,depending on the type of wine being produced.Ageing the wine:-6. After crushing and fermentation, wine needs to be stored, filtered, and properly aged. In someinstances, the wine must also be blended with other alcohol. Many wineries still store wine indamp, subterranean wine cellars to keep the wine cool, but larger wineries now store wine aboveground in epoxylined and stainless steel tanks. The tanks are temperature-controlled by waterthat circulates inside the lining of the tank shell. Other similar tanks are used instead of the oldredwood and concrete vats when wine is temporarily stored during the settling process.After fermentation, certain wines (mainly red wine) will be crushed again and pumped intoanother fermentation tank where the wine will ferment again for approximately three to sevendays. This is done not only to extend the wines shelf life but also to ensure clarity and colorstability.The wine is then pumped into settling ("racking") tanks or vats. The wine will remain in the tankfor one to two months. Typically, racking is done at 50 to 60 degrees Fahrenheit (10 to 16degrees Celsius) for red wine, and 32 degrees Fahrenheit (0 degrees Celsius) for white wine.
  17. 17. 7. After the initial settling (racking) process, certain wines are pumped into another settling tankor vat where the wine remains for another two to three months. During settling the weightyunwanted debris (remaining stem pieces, etc.) settle to the bottom of the tank and are eliminatedwhen the wine is pumped into another tank. The settling process creates smoother wine.Additional settling may be necessary for certain wines.8. After the settling process, the wine passes through a number of filters or centrifuges where thewine is stored at low temperatures or where clarifying substances trickle through the wine.9. After various filtering processes, the wine is aged in stainless steel tanks or wooden vats.White and rose wines may age for a year to four years, or far less than a year. Red wines mayage for seven to ten years. Most large wineries age their wine in large temperature-controlledstainless steel tanks that are above ground, while smaller wineries may still store their wine inwooden barrels in damp wine cellars.10. The wine is then filtered one last time to remove unwanted sediment.The wine is now ready to be bottled, corked, sealed, crated, labeled, and shipped to distributors.Packaging:-11. Most medium- to large-sized wineries I now use automated bottling machines, and mostmoderately priced and expensive wine bottles have corks made of a special oak. The corks arecovered with a peel-off aluminum foil or plastic seal. Cheaper wines have an aluminum screw-off cap or plastic stopper. The corks and screw caps keep the air from spoiling the wine. Wine isusually shipped in wooden crates, though cheaper wines may be packaged in cardboard.
  18. 18. List of the machine to be used in the manufacturing process and their cost ofpurchase:- RS. 2,25,000.00Fermentation Machine RS. 3,50,000.00Automatic Cylinder Wine Cap
  19. 19. RS. 2,02,000.00Bottling Machine RS. 2,20,000.00Harvesting Machine
  20. 20. MARKETING MANAGEMENT:-MARKETING STRATEGYDemand and competition to our product is very high and the forecast is done to improve andoccupation of the product.DISCOUNT:-Discounts are given to the regular customers and also gifts given on some festivals which willincrease the sales by getting new customers.Gifts may be of various types such as calendar, dairy, etc, the rural people are many more attractto this scheme.PROMPT DELIVERY AND CORRESPONDENSE:-For success of any unit daily prompt correspondences creates goodwill to industry and throughwhich we can give proper attention to our customer. Whole sales, retails, agencies for theircomplaints etc.SCHEMES:-For successful launching different schemes are given on the Bulk purchase of product.ADVERTISING:-Advertising attracts the customers and helps a lot get them to purchase your product or service.For the advertisement of the product by the following ways:-A] Local Cable NetworkB] StickersC] Local NewspapersD] BannerE] Official Telephone Directories. By this approach of advertisement result in increase income from Sales whichexceeds the cost of advertising. In addition to promoting a specific product or serviceadvertisement helps to create the image of firm.
  21. 21. FINANCIAL MANAGEMENT:-SOURCES OF FINANCE:-Supply of finance is very important factor in the establishment of an enterprise. Finance is thelife line of the business. Finance deals with the arrangements of the sufficient capital for thesmooth run of the organization. Following are the certain sources of the scheme of the finance.A) OWN CAPITAL:-According to the rules set up by various financial institution 25% to 35% of the capital should bethe own investment of the entrepreneur. 30% of the project cost will be financed by the promoterhimself.B) TERM LOAN FROM THE COMMERCIAL BANKS:-State Bank of India, MIDC, Nanded’s lend Rs. 33,31,300.00/ at the rate 11%C)TERM LOANS FROM THE NATINAL SMALL INDUSTRIES CORPORATION:-NSIC provides loans at 8.5% to small scale industries for the development of the working capitalrequirement.
  22. 22. COST OF THE PROJECT:- SR.NO PARTICULARS AMOUNT 01 Land 12,00,000.00 02 Site development 40,000.00 03 Building 11,00,000.00 03 Plant and machinery 26,50,000.00 04 Furniture and Misc 2,00,000.00 05 Preliminary and preoperative exp. 85,000.00 06 Depreciation 5,27,500.00 06 Working capital (3months) 37,15,500.00 TOTAL 95,18,000.00MEANS OF FINANCE:-SR.NO RATE OF PARTICULARS AMOUNT INTEREST01 NIL Promoters Capital 28,55,400.0002 11% Punjab National Bank 33,31.300.0003 8.5% NSICL 33,31,300.00 TOTAL 95,18,000.00
  23. 23. TOTAL FIXED CAPITAL:-SR.NO PARTICULARS AMOUNT01 Land 12,00,000.0002 Site development 40,000.0003 Building 11,00,000.0003 Plant and machinery 26,50,000.0004 Furniture and Misc 2,00,000.0005 Preliminary and preoperative exp. 85,000.0006 Depreciation 5,27,500.00 TOTAL 58,02,500.00SITE DEVELOPMENT:-SR. No Particulars Cost of the Amount itemsO1 Filling of the land 11,000.00 11,000.0002 Fencing 12,000.00 12,000.0003 Gardening 7,000.00 7,000.0004 Gates 10,000.00 10,000.00 Total 40,000.00 40,000.00
  24. 24. BUILDING:-SR. No Particulars Cost of the Amount items01 Corporate office 1,50,000 1,00,000.0002 Work shop 9,00,000 5,00,000.0003 Toilets 1,75,000 75,000.0004 Store room 6,00,000 4,25,000.00 Total 18,75,000 11,00,000,00PLANT AND MACHINERY:-SR. No Particulars Quantity Amount01 Harvesting machine 02 5,50,000.0002 Cylinder wine cap 04 14,00,000.0003 Bottling machine 04 8,10,000.0004 Fermentation machine 04 8,80,000.00 Total cost 26,50,000.00 PRELIMINARY AND PRE.OPERATIVE EXPENSES:-SR. No Particulars Amount01 Deposit for power ,water , telephone 23,000.0002 Loan application process fee 8,000.0003 Legal stamp duty and registration 20,000.0004 Travelling 12,000.0005 Consultancy 22,000.00 Total 85,000.00
  25. 25. FURNITURE AND MICELLANOUS ASSETS:-SR. No Particulars Quantity AmountO1 Furniture Office chairs 8set 5,000.00 Almirah 4 20,000.00 Racks 10 18,000.00 Tables 2 15,000.00 Computer and accessories 3 70,000.00 Photocopy machine 1 43,600 Fans 8 6,400.00 Sofa 1 10,000.0002 Work shed ------- 12,000.00 Total 2,00,000.00DEPRECIATION (P.A):-SR. No Type of Assets Cost of Assets Rate of Amount Dep.01 Plant and machinery 26,50,000.00 15% 3,97,500.0002 Furniture 2,00,000,00 10% 20,000.0003 Building 11,00,000.00 10% 1,10,000.00 Total 39,50,000.00 5,27,500.00
  26. 26. WORKING CAPITAL REQUIREMENT:-SR. No Particulars 1 month 3 month01 Raw materials 10,00,000.00 30,00,000.0002 Salary and wages 1,70,500.00 5,11,500.0003 Other manufacturing 30,000.00 90,000.00 expenses04 Power and fuels 20,000.00 60,000.0005 Selling and office 18,000.00 54,000.00 expenses Total 11,63,000.00 37,15,500.001. SALARY AND WAGES:-SR.No Name of the No Per Salary/Head Salaries/Month Salaries/Year Post Post01 Manager 01 30,000.00 30,000.00 3,60,000.0002 Supervisor 01 15,000.00 18,000.00 1,80,000.0003 Skilled 05 10,000.00 50,000.00 6,00,000.0004 Unskilled 10 3,000.00 1,20,000.00 3,60,000.0005 Watchman 04 2,000.00 8,000.00 96,000.0006 Sales 02 18,750.00 37,500.00 4,50,000.00 Manager Total 20,46,000.00
  27. 27. 2. POWER AND FUELS:-SR.No Particulars P.M. P.A.01 Fuels 8,000.00 96,000.0002 Power 12,000.00 1,44,000.00 Total 20,000.00 2,40,000.003. OTHER MANUFACTURING EXPENSES :-SR.No Particulars P.M. P.A.01 Paints 5,000.00 60,000.0002 Packaging materials 25,000.00 3,00,000.00 Total 30,000.00 3,60,000.004. OFFICE,SELLING, DISTRIBUTION EXPENSES:-SR.No Particulars P.M. P.A.01 Postage and stationeries 2,000.00 24,000.0002 Telephone bills/internets 4,000.00 48,000.0003 Transportation 12,000.00 1,44,000.00 Total 18,000.00 2,16,000.00
  28. 28. VARIABLE COST:-SR.No Particulars P.M. P.A.01 Raw materials (100%) 10,00,000.00 1,20,00,000.0002 Wages (80%) 1,36,000.00 16,36,800.0003 Power and fuels (90%) 18,000.00 2,16,000.0004 0ther manufacturing expense 30,000.00 3,60,000.00 (100%)05 Interest w/c loans (80%) 27,373.00 2,93,154.0006 Interest term loans (20%) 4,719.00 56,632.0007 Selling and administrative 18,000.00 2,16,000.00 expenses (100%) Total 12,31,549.00 1,47,78,586.00FIXED COST:-SR.No Particulars P.M. P.A.01 Wages (20%) 34,100.00 4,09,200.0002 Power and fuels (10%) 2,000.00 24,000.0003 Interest on w/c (20%) 6,107.00 73,289.0004 Interest on term loans (80%) 21,152.00 2,26,528.0005 Office, selling, distribution 18,877.00 2,16,000.00 expenses (90%)06 Depreciation (100%) 43,958.00 5,27,500.00 Total 1,23,044.00 14,76,517.00
  29. 29. COST OF THE PRODUCTION:-SR. No Particulars 1 month 1 year01 Raw materials 10,00.000.00 1,20,00,000.0002 Salary and wages 1,70,500.00 20,46,000.0003 Other manufacturing 30,000.00 3,60,000.00 expenses04 Power and fuel 20,000.00 2,40,000.0005 Depreciation i)plant & machines@15% 33,125.00 3,97,500.00 ii)furniture@10% 1,666.00 20,000 iii)building@10% 9,166.00 1,10,000.00 Total 12,64,459.00 1,51,73,500.00ESTIMATED SALE:-SR. No Items No items Price /item Monthly Annually sales sold sales /month01 Air 04 2,50,000.00 10,00,000.00 1,20,00,000.00 receiver02 MS 09 50,000.00 4,50,000.00 54,00,000.00 Hoppers 13 14,50,000.00 1,74,00,000.00
  30. 30. PROFITABILITY:-SR.No Particulars P.M P.A.01 Sales 16,59,583.00 1,99,15,000.0002 Less Cost of production 12,64,458.00 1,51,73,500.0003 Gross 3,95125.00 47,41,500.00 profit04 Less Office, selling, 18,000.00 2,16,000.00 distribution05 Less Interest on loan @11% (PNB) 30,536.00 3,66,443.00 @8.5%(SIDC) 23,596.00 2,83,160.0006 Net profit 3,22,991.00 38,75,897.00
  31. 31. BREAK EVEN POINT:-Formula Used; FIXED COST B.E.P= _______________ CONTRIBUTIONCONTRIBUTION= SALES-VARIABLE COSTCONTRIBUTION= Rs 1,99,15,000.00 – Rs 1,47,78,586.00 = 51,36,414.00 14,76,517.00 B.E.P= _____________ X 100 = 28.74% 51,36,414.00
  32. 32. CONCLUSION:-I have chosen this product to introduce in Maharashtra state as this industry is in growth.This wine industry is emerging as a food drink & government is also focusing for growth ofit they are providing incentives for the wine industry, so this mine industry will have a amplescope in future.