Palm production & processing

Eat Fresh Live Healthy
ACTING PRINCIPAL
DHAKA CITY COLLEGE
PANDEMIC TOUCH
B.B.A. 12TH
BATCH
SECTION - F
30TH
MARCH, 2010.
A project by “Pandemic
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SUBMITTED TO
SUBMITTED BY
DATE OF SUBMISSION

PANDEMIC TOUCH
B.B.A. 12TH
BATCH
SECTION-F
Serial
No.
Members name ID Signature
01. Mumtahina Afroz 341
02. Flora Sharmin 342
03. Jahid Hasan 343
04. Nuren Fahmid 344
05. AKM Shahab Uddin 345
06. Tazrian Zahir 346
07. Md. Fahim Siddiqui 347
08. Priyanka bishwas 348
09. Sarah Marzia Beg (leader) 349
10. Md. Ahad Rahman Niloy 350
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Letter of transmittal
30 March, 2010.
To,
The Acting Principal,
Dhaka City College,
Dhanmondi, Dhaka.
Sub: Report on palm production and processing.
Sir,
With great pleasure, we the members of “Pandemic Touch” would like to submit our
project on “Palm production and processing”. we have taken this term project as a
great chance to know more about business plan. This report gives a practical scenario
of Business plan. This will also help us to get idea about Business planning.
We have tried our best to enclose all the related information. This report will
definitely give us an exceptional experience that will be useful in the future on
practical ground.
In preparing this report, we had limitation of many, time and insufficient man power
of the organization.
We, therefore, pray and hope that you will be kind enough to take our final report for
presentation considering our limitation and oblige thereby.
Your faithfully,
(On behalf of the group members)
“Pandemic Touch”
B.B.A. 12th
Batch,
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Section: F.
Acknowledgement
At the very beginning, we acknowledge the immeasurable blessing and profound
kindness of “Almighty Allah”- the supreme authority of the universe.
Numbers of individuals have contributed to this report. Firstly we are thankful to all
of them for their help and support. Foremost we are thankful of our coordinator Mr.
Hafizul Islam who has given us the opportunity to make our report with the practical
business environment. We are thankful to our course instructor Mr. Mohammad
Mosharraf Hosssain for his technical and mental support. He also helps us to
understand the theoretical part of Management. We are also thankful to MS. Jafrin
sultana & MS. Nasrin Sultana for giving theoretical knowledge in Financial and
Marketing segment respectively. We are also thankful to Mr. Quazi Ahmed and Mr.
Saiful Islam for self-motivation and guidance. We have got an opportunity to view the
previous report from BBA conference room. So we are thankful to Md. Johural Haque
for his patience. We thanks to the authority of BBS (Bangladesh Bureau of Statistics)
for giving us information. This report is on palm production and processing . It is one
of the greatest additions to our knowledge and wonderful experience. Making this
project report we have worked as a group. The whole group collects accurate
information regarding the topic. Still there may have some errors. We apologies for
our mistakes.
Finally, we are pleased to complete the report on the given subject properly and
authentically.
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Palmate Palm Plant (Pvt.) Ltd
Board of directors:
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MD. FAHIM SIDDIQUI
MD. AHAD RAHAMANJAHID HASAN
AKM SHAHAB UDDINTAZRIAN ZAHIR PRIYANKA BISHWAS
FLORA SHARMIN
SARAH MARZIA BEG
MUMTAHINA AFROZ

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Executive Summary
In our country, there are many businesses. Some are related to agriculture and some
are about industry. This report, prepared by us is about an amateur business in
Bangladesh, that Palm Production & Processing. Bangladesh is a quite new in this
business. No one farm participated in this business from our country. We are going to
be 1st
0ne in Bangladesh. The name of our farm is “Palmate Palm Plant (Pvt.) Ltd.”. It
is all about palm oil business. As there are many competitors of us in this country, the
scope of this establishment of our farm is pretty bright. Our competitors are both local
and importer Soya been &Palm oil. We are going to start this business as an amateur,
but our vision is to be the local market leader within the year 2025.We will provide
the best product with cheap rate. We are able to supply TFA1
free high quality RBD2
Palm vegetable olein3
. Customer’s satisfaction will be considered as the best award
for us.
We are proud to have such persons who have promoted us highly. Above them, some
are related to our farm and others are hired from Malaysia.
Our firm will be formed as a private limited company. We have Ten Shareholder. Our
farm has three sections. Two’s are Cox’s bazaar and the rest one is Dilkhusha. We
have specific land for our project. We will cultivate palm & offer cultivation. We will
produce palm oil, palm olein & kernel oil when we will able to collect our main raw
materials (Palm Plant) from the Malaysia and Myanmar and others will collect from
our palm ground field for palm processing. As the oils will be ready to deliver in just
time.
The target market of us is divided into three parts. In palm oil & palm olein sectors,
the redefined target market includes General Mass, restaurant, hotel etc. In kernel oil
sector our target market is soap manufacturing companies. We will keep regular
communication with them about our service. Our customer will be able to order by
online. Our company will be much careful about the comments of our customers.
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1. TFA ( Trans Fatty Acid )
2. RBD ( Refined Bleached Deodorised )
3. Olein ( Liquid Fraction of Palm oil )

The total cost of the project is projected 60,000,000 taka. 35% of that amount will
cover by bank loan with rate of 13% interest. For the 1st
year the production cost is
projected as 3700000 taka for 72000 litters’ palm olein & 2000 litters’ kernel oil. By
the time continues, the rate of production will be increased.
Our company will not focus only on the profit, but also will do some social activities.
Any activities related to our business will not be done which affects the environment.
Every activity will be kept transparent to the people of our country. We will publish
annual reports for the visitors.
Finally we can say that our company will have a bright future in the local market. We
can hope with our company that if all member’s works effectively efficiently. Our
company will be the no.1 company in local edible oil market in our country.
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Table of contents
Number Contents Page no.
I Title Fly
II Title Page I
III Group Identification II
IV Letter of Transmittal III
V Acknowledgement IV
VI Introducing Company’s Shareholder V
VII Executive Summary VI-VII
Chapter-1 Business Introduction
1.1 Introduction 1
1.2 Objectives 2
1.3 Methodology 3
1.4 Limitations 4
Chapter-2 Business Description &
Management Segment
2.1 General Description of Business 5
2.2 Industry Background 5
2.3 Company History 6-7
2.4 Goals & Objectives 7
2.5 Uniqueness of the product 8
2.6 Management & Organization 8-9
2.6.1 Management team key Personnel 10
2.6.2 Legal structure 10
2.6.3 Legal Fact 10
2.6.4 Board of directors 11
2.6.5 Management adversary board 11
Chapter-3 Technical Segment
3.1 Location analysis 12
3.2 Production needs 12-15
3.2.1 Operation plan 15
3.2.2 Our products 15-17
3.2.3 Chemical composition of palm oils 17-18
3.2.4 Health & Nutrition 19
3.3 Suppliers 21
3.4 Source of raw materials 21
3.5 Labor supply 21
3.6 Production process 21
3.7 Quality control 22
Chapter-4 Marketing Segment
4.1 Current Scenario in Bangladesh 23
4.2 Situation Analysis 23
4.3.1 Market summary 23
4.3.2 SWOT Analysis 24-25
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4.2.3 Marketing research 26
4.2.4 Competitor Analysis 26
4.3 Marketing Strategy 26
4.3.1 STP Analysis 26-27
4.3.2 Marketing Mix Analysis 20
Product 29
Uniqueness 29
Benefits 29
Features 29
Price 29
Breakeven analysis 30-33
Distribution Channel 34
Delivery terms 34
Packaging & shipment 34
Payment method 34
Sales forecast 35
Promotion 35
4.4 Corporate Social Responsibility in
Marketing
37
Chapter-5 Financial Segment
5.1 Cost of project 38
5.2 Financial plan & loan requirement 39
5.3 Means of Financing 40
5.4 Loan repayment schedule 41
5.5 Profitability projection 42
5.6 Projected income statement 43
Chapter-6 Conclusion
Conclusion 44
Bibliography 45
Chapter-7 Appendix
Glossary 46
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Introduction
In the context our country, Palm Production & Processing isn’t a established business.
As a new business it has so many potentialities scopes to be a profitable sector.
Thinking about a business is like leading an adventure. However Palmate Palm Plant
(Pvt.) Ltd. is a unique business company for Palm Production venture in Bangladesh
interested to deal in Palm oil. Basically our industry is an agro based industry. Every
year we have to import large quality of edible oil in which more than 40% in palm oil
and those are not well refined. Despite the convenient weather support and huge
potentiality to grow Palm tree here, we import because we lack initiative to grow
Palm tree locally. Considering the need we are planning to grow palm tree,
manufacture palm oil, TFA free RBD palm olein, vegetarian cooking oil, and kernel
oil and market them.
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Objectives
We have specific goals & objectives for present and future. Our main objective is to
produce TFA free high quality RBD palm vegetable olein cooking oil. Our other
objectives are given below:-
 To produce also palm oil & kernel oil and make an example of producing
palm oil in Bangladesh.
 To provide a well refined & fresh looking oil.
 To operate the company through a profitable way and to have growth.
 To reduce the cost of the Govt. in importing edible oil. We will market Palm
oil, Palm olein & kernel oil in a subsidized price.
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Methodology
To make this business plan we have to give all our effort. To prepare this report
standard methods of collecting information and report writing have been used. We
used all secondary data for preparing this report by market survey. We collected all
data from internet, magazine, different books and topic of STP, SWOT, and
Promotion.
Beside this we have collected as many information from outside source, like as BBS
(Bangladesh Bureau of Statistics)
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Limitations
This study as an empirical study, suffered from some limitations short comings, lapses
and many others obstacles. However, we have tried to give our maximum effort so
that this repot and an acceptable conclusion can be drowned and benefited.
 We did not have enough time for preparing this report.
 Lack of information.
 We did not have sufficient fund for writing report.
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2.1 General description of business:
We are living in the world of business. Business is the
root of the economy activity and everything is
encompassing it. Thinking about a business is like
leading an adventure.
However, we are going to take an adventure with palm oil. Every year we have to
import huge quality of edible oil in which more than 40% is palm oil .Every year
Bangladeshi government imports 1.2 million tones of edible oil costing gap
proximately 5000 core taka. Despite the convenient weather support and huge
potentiality to grow palm tree here. We import because we lack initiative to grow
palm tree locally. Considering the need we are planning to grow palm tree,
manufacture palm oil, kernel oil and market them.
2.2 Industry background:
“Palm-oil” the word came from African oil palm. The history of Palm Production &
Processing started from the invention of Palm seeds. Palm seeds were first invented in
1848 in Denmark. The first Palm industry of the world was established in Britain in
1960-1970 century. The name of the company was Malaysianijation Company. After
that few other had started this industry. So Denmark is the first country that introduce
palm in the world. Now several countries like as Malaysia, Australia, Indonesia etc.
started this business. But still now Bangladesh is totally out of this idea. We are the
first whose are going lunch Palm Production & Processing in our Bangladesh.
The name of our company is Palmate Palm Plant (Pvt.) Ltd and this is the first Palm
industry in Bangladesh.
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2.3 Company history:
• 2.3.1 Vision:
Our target is to be the local leader of edible oil market within 2025. We fulfill the
necessity of local market by producing oil in our own country and stop importing oil
from other countries.
• 2.3.2 Missions:
We are forwarding with a great mission. Our mission statement consists of three
interrelated parts.
Product mission:
Producing palm locally, processing palm to market palm oil and kernel oil those are
wholesome and neutral to environment
Economic Mission:
To operate the company through a profitable way and to have growth. Economic
establishment of the owners and career progression of the employees.
Social Mission:
Reducing the cist of the government in importing edible oil. Marketing palm oil and
kernel oil in a subsidized price.
• 2.3.3 History:
Palmate Palm Plant (Pvt.) Ltd is the first Palm Production & Processing Company in
Bangladesh. Before this company Bangladeshi soap industry & people had used
imported oil. This idea first came in our thinking at 27-02-2010. From this date we are
working for building of our company. Others identification are given below :-
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NAME ADDRESS
Making a difference
Palmate Palm Plant Pvt. Ltd
Kalilchara
Ramu
Cox’s Bazar
Phone: 9128506
Cell : +880 1672910584
Fax :88-02-9560299
E-mail :
The another office is situated in our servicing office. The address of this office in
given below :-
2.4 Goals & Objectives:
We have specific goals and objectives for present and future. Presently we want to
work in Cox’s bazaar. Our future goal is to expand the business in other hilly district
like Banderbans and Rangamati.
To achieve the goals we have some objectives. Our main objective is to produce TFA
free high quality RBD palm vegetable olein cooking oil and other objectives is to
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ADDRESS
BCIC Bhaban (8th
Floor,30-31
Dilkhusha C/A
Dhaka-1000.
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produce palm oil and kernel oil in a reduced cost in comparison to the importers
imported cost.
2.5 Uniqueness of the product:
We are producing such a product that people need everyday without considering its
features and benefits. However, we have some unique product features and benefits.
 TFA free High quality RBD palm olein vegetable cooking oil that all classes
of people get the right and high quality product and being satisfied.
 Our palm oil is refined and fresh looking. In Bangladesh palm oil isn’t well
refined.
 We can sell palm oil and kernel oil less than the importing cost. Thus we can
save people money.
 We supply the kernel oil to the soap manufacturers that they must import
kernel oil from other exporter countries because the local market isn’t exist till
now.
2.6 Management & Organization:
Our day to day management will be conducted by a group of experienced and talented
managers. We shall hire 7 employees from Malaysia for different duties. Some of
them will directly join to the management. Owners of our company will also join the
chief management of the company. Owners will be contracted with the company and
run the top management. Give below our organization chart which clarifies the
position of the managers and employees.
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Organizational chart
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Board of directors
Managing
directors
Palm ground
manager
Production
manager
Human
resource
General Manager
Finance manager
Account
manager
Agrarian
40 Workers
Agrarian
40 Workers
Agrarian
40 Workers
Specialist in palm
oil
60 Workers
Specialist in kernel
oil
60 Workers
2 Enployees
2 Enployees
2 Enployees

• 2.6.1 Management team key personnel:
Our management team is our honorable ten members of our board of director. Our
chairman co- ordinates the organization through planning and decision making. Our
Managing director manages the whole management sector.
• 2.6.2 Legal structure:
Primarily we want to establish as a private limited company. We are ten
entrepreneurs .In future we may move into (public limited company). Our company
needs huge amount of capital. For this reason, we may have become public limited
company but firstly we are not trying to be so. Firstly, we want to take risk by
ourselves. At the beginning, we may not get responses from general investors who
will be willing to invest in our company. Besides, we want to make a valuable image
in this field by running it through private limited company. We want to make an
example here.
• 2.6.3 legal fact:
We could think ourselves as partners but we do not like to do so, we want to be a
private ltd. Company. The reason behind the fact is to get strong legal support. Still
we have to go through the licensing procedure. We strongly believe that we shall get
positive incentive and supports from (BCIC) will provide us the business license. Our
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industry will not pollute the environment highly. Besides, our palm field will turn into
forest within 10-12 years that will be very helpful for environment.
• 2.6.4 Board of directors:
Our board of directors includes 10 members – all owners of the company. Our
honorable board of directors is:
01. Mumtahina Afroz
02. Flora Sharmin
03. Jahid Hasan
04. Nuren Fahmid
05. AKM Shahab Uddin
06. Tazrian Zahir
07. Md. Fahim Siddiqui
08. Priyanka bishwas
09. Sarah Marzia Beg
10. Md. Ahad Rahman Niloy
• 2.6.5 Management adversary board:
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 Any five of the members of the above chart will be active members of the
management.
 Advocate Abdur Rajjak, layer of the Supreme Court will provide us legal
support.
 Mr. Mojid Hossin will be our banker.
 We shall have additional two specialists from Malaysia for providing mentors
and adversary support.
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3.1 Location analysis:
• 3.1.1 Palm ground location:
Site selection for any industry is very much vital. Our palm ground is in Ramu Cox’s
Bazaar. To be close to raw materials we have chosen our site near the palm ground.
our total 12hectares of land will be ready for planting trees.
• 3.1.2 Industrial location:
People all over the country are the customers of our products. so
we don’t think where to locate our industry. However considering
the raw material supply we proposed our location just two km.
away from our palm field. Our proposed industry zone will be 12
hectares of land .we shall use electricity produced in Kaptai Lake.
We are bound to locate our palm field in Cox’s Bazaar because
palm tree don’t grow beyond 20 degree equator tropical zone.
3.2 Production needs:
Basically, we are having an agro-based company. Before having finished products we
have to go a long way. Due to the nature of our raw materials, we cannot go to
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Palm ground location
Location
Industrial location

production before 2 years starting from now. Producing palm needs at least 15-18
months to have palm in hand. Then we can think about production of palm oil, other
products from it and its marketing. Palm trees average highest age is 25 years.
Considering the fact we have purchased 13hectares land in Cox’s Bazar at Ramu
Primarily. We may extend the land at Bandharban, Rangamati in future. This land is
actually on the slope (not much as sleep) of the hill and plant land also.
We are choosing the land for raw material production because palm production needs
forest like environment and where people seldom go or a desolate place. Besides our
palm field will form into a deep forest within 10-12 years
Land with little solve is convenient for production of palm; our intended
location will meet the requirement. We are taking the lease from the government. It
will cost 2, 00, 00,000 taka.
Planting palm tree needs 25 degrees temperature and 200”and above rainfall.
As a hilly site Cox’s bazaar meets the demand. By the end of the year we are
importing some palm plants from Malaysia and Myanmar within that time our total
12hectares of land will be ready for planting trees.
To inspect and guide the total palm productions we are hiring three agrarians
who are specialist on palm production. We need our facilities layout fully equipped at
the end of 2012. Our industry is a heavy industry. So we need heavy machineries. All
the machines will be imported from Japan. That will cost 3, 00, 00,000 taka.
Palm oil machines kernel oil machines
Vessel
Sterilizer
Stripper
Deacidification
Alkali Refiner
Alkali Nevtralizer
Earth bleacher
Charsher
Refiner vessel –1
Refiner vessel-2
Total 10 machines.
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PALM PLANTS
Planting palm tree needs 25 degrees temperature
and 200”and above rainfall. As a hilly site Cox’s
bazaar meets the demand. By the end of the year
we are importing some palm plants from Malaysia
and Myanmar within that time our total
12hectares of land will be ready for planting trees.
Imported palm plant
PLANTATION & GROWING
Palm trees may grow up to sixty feet and more in
height. The trunks of young and mature trees are
wrapped in fronds which give them a rather rough
appearance. The older trees have smoother trunks
apart from the scars left by the fronds which have
withered and fallen off.
OIL PALM TREE
Oil palm tree will start bearing fruits after 30 months of field planting and will
continue to be productive for the next 20 to 30 years; thus ensuring a consistent
supply of oils. Each ripe bunch is commonly known as Fresh Fruit Bunch (FFB). We
will divide oil palm tree into two categories.
Early Maturity
Our planting material is vigorous and
harvesting of fruits can commence 18 months
after planting as opposed to the industry
average 30-36 months
2 Year Old Oil Palm
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High Yield
Our planting material can produce a
high yield of 16 tons/ha in the first year
of harvesting, subsequently increasing
to 35-38tons/ha in the 5th year of
harvesting.
FRESH FRUIT BUNCH (FFB)
Palm fruit contains two types of oil: palm oil,
which comes from the mesocarp or fleshy part
of the fruit, and palm kernel oil, which comes
from the seed in the fruit. Both have
significant commercial value.
Fresh Fruit Bunches
• 3.2.1 Operation plan:
After Palm plantation we need to process. We shall have standardized operational
process and technology imported from Malaysia. Our all heavy machines will be
imported from Japan
• 3.2.2 Our products:
The Oil
Our oil palm produces two types of oils; crude palm oil (CPO)1
from the fibrous
mesocarp and crude palm kernel oil (CPKO)2
from the kernels. Although both oils
originate from the same fruit, palm oil is chemically and nutritionally different from
palm kernel oil. It is one of the only two mesocarp oils available commercially, the
other being olive oil.
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In conventional milling process, the FFB’s3
are sterilized and the fruitlets stripped off.
The loose fruitlets are then digested and pressed to extract the CPO. The kernels are
separated from the fibrous mesocarp in the press cake and later cracked to obtain
CPKO.
Palm oil: palm oil is going to be our major product. However our
palm oil will be well-refined than that of the importers’ palm oil, In
our country importers market palm in 16 liters tin. We will market it
in tin as well as 1,2,3 and 5 liters container.
RBD Palm olein:
Palm olein is going to be another major product. Palmate Palm
Plant (Pvt.) Ltd. now able to supply high quality RBD Palm
Olein Cooking Oil.
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1. CPO ( Crude Palm Oil )
2. CPKO ( Crude Palm Kernel Oil )
3. FFB ( Fresh Fruit Bunch )

Palm Olein
Cooking Oil
Product
Specifications:
• Iodine Value
(Wijis) : 56 min.
• Melting Point : 24
deg c
• Cloud Point : 10
degrees Celsius
max.
• Free Fatty Acids as Palmitic : 0.1% max.
• Moisture Content : 0.1% max.
• Colour, 5.14" Lovibond Cell : 3 RED max.
Palm Olein Cooking Oil Applications & Benefits:
• Ideal for cooking and baking
• Very rich in Vitamin E
• No Trans Fatty Acids
• Cholestrol and Lactose FREE
• No artificial additives or preservatives
Shelf life and certification:
• Shelf Life is 24 months from the date of production.
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• Conforms to the requirements stipulated by Bangladeshi Food Act and Regulations
• 100% HALAL
• ISO 9001 : 2000 certified
• HACCP Codex Alimentarius
• GMP Codex Alimentarius
Kernel oil: Palm kernel oil is obtained from the kernel of
the oil palm fruit. The oil composition is very different from
that of the palm oil. kernel oil is one the important raw
material for soap manufacturing. By our facilities, we shall
produce kernel oil. Presently, soap manufacturers import
kernel, we expect that we shall contribute to non-importing of kernel oil to some
extend.
• 3.2.3 Chemical composition of palm oils:
Crude Palm Oil is the richest natural source of Tocotrienols. Our company has
developed a special patented technology for extraction. The latest technology to
purify Tocotrienols from the fruits of oil palm (Elais guineensis) was developed
to produce a superior quality and purity.
Formation of tocotrienols
Tocotrienols are members of the Vitamin E family comprising of Tocotrienols and
Tocopherols. Tocotrienols differ from the Tocopherol's in that they contain three
double bonds in the side-shain (see molecular structure). Tocotrienols Isoprenoid side
chain has three double bonds as compared to Tocopherol's saturated side-chain. In
total, there are
four types Tocopherols namely alpha, beta, gamma and delta and four corresponding
of Tocotrienols isomers.
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Alpha Tocotrienols is 40-60 times more potent than normal Tocopherols making it
one of the most powerful lipid soluble anti oxidants available.
Among vegetable oils, palm oil is the richest natural source of Tocotrienols.
Tocotrienols are surprisingly not found in any other vegetable oils like soy bean oil,
canola oil, rape seed oil and sunflower oil. Tocotrienols can be found naturally but in
much lesser quantities in rice barn, barley, wheat gem and oats.
Palm Tocotrienols complex contains significant amount of D-Alpha-Tocopherol, D-
Alpha-Tocotrienol, D-Gamma-Tocotrienol and D-Delta-Tocotrenol as compared to
most other naturally found vitamin E, which are mostly Tocopherols.
• 3.2.4 Health & Nutrition:
The palm oil is rich in naturalchemical compounds important for health and nutrition.
Among others, it is a natural source of Carotenoids & Vitamin E as well as supplying
fatty acids and other important fat-soluble micronutrients. It also supplies an
abundance of calories that gives us much-needed energy for our daily life.
Trans-Fatty Acid (TFA) Free
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Solid fats made from palm oil are better for health as they do not have to go through
hydrogenation. Hydrogenation of oils produces TFAs along with saturated fatty acids
and modifies cis-fatty acids. TFAs have been implicated by numerous scientific
studies to breast cancer, colonic cancer, and heart disease. It is also believed to
contribute to development of Type 2 diabetes and impairment of brain development in
newborns. Many countries today warn consumer against intake and/or even regulate
the content of TFAs in foods sold in the irrespective markets. This underlines the
growing recognition and concern over their negative health effects.
Rich In Vitamin E
Palm oil is rich in Vitamin E (tocopherols & tocotrienols). In fact, no other vegetable
oil has as much Vitamin E compared to Palm Oil. Vitamin E is a powerful anti-
oxidant, capable of reducing the harmful types of oxygen molecules (free radicals) in
the body. This means they may help to protect you from certain chronic diseases,
while delaying the body's ageing process. Latest research shows that the tocotrienol
form of Vitamin E reacts more effectively than tocopherols.
Carotenoids
Carotenoids are natural chemical compounds that give crude palm oil its orange-red
color and that make palm oil red in color. Unrefined palm oil and crude palm oil are
nature's richest source of carotenoids as compared to the other vegetable oils - 15
times more than carrots, and 30 times more than tomatoes.
The most active and important form of carotenoids found in palm oil is ?carotene
(beta-carotene).Many carotenoids contain Vitamin A which is an effective antioxidant
that helps strengthens the body's immune system and reduces the risk of cancer, heart
disease and cataract. Lack of Vitamin A can lead to blindness and a variety of serious
medical conditions.
Nutritious Oil
Another reason why you need palm oil is because it supplies fatty acids as well as
important fat-soluble micronutrients like Carotenoids (including pro-vitamin A),
vitamins D, E and K.
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Fatty acids are raw materials for building the membranes of every cell in your body,
including your bones, nerves and brain! The micronutrients keep your body cells
healthy and functioning properly.
You would be malnourished and become sickly or prone to infections if you do not
have fats and oils in your diet. The same result will happen if you lack foods that
supply carbohydrates, protein, minerals and other vitamins. The best way to meet all
your nutritional needs is to follow the Food Guide Pyramid - the lower the food group
on the pyramid, the more of it you should eat.
Calories
Palm oil is very rich in calories. One gram of palm oil supplies 9 Kcal of energy,
which is 2 ½ times more than one gram of protein (4 Kcal) or carbohydrates (4 Kcal).
Energy should come from all groups of food, including fats and oils. Experts calculate
that ordinary adults need between 1,800 Kcal to 2,000 Kcal per day, out of which up
to 30% can be obtained from fats and oils.
3.3 Suppliers:
When we start our business we need some suppliers make as support source of our
business. It’s very important to receive the supplies in time to serve the valued
customers with quality service. To select the suppliers, we first collect the list of
suppliers and their customers. Then we go to the customers of those suppliers to
receive feedback. We also supply our product directly to the customer by using our
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own transportation facilities. This approach helps us to identify the efficient suppliers
& customers in the business world.
3.4 Source of raw materials:
Raw materials for the project are the Palm plants. The Palm plants collect globally.
We import these Palm plants from Malaysia & Myanmar. We cultivate this plant FFB
using the local labor and get the Palm. We used this FFB for produce our products.
3.5 Labor supply:
Labor is an important part of our organization. We collect our labor from the local
area. We give them train about Palm cultivation by our expert technician. Labor is
available here and they are interested to work with us. Here labor cost is not very
high.
3.6 Production process:
A unique feature of the oil palm is that it produces two types of oil - palm oil from the
flesh of the fruit, and palm kernel oil from the seed or kernel. For every 10 tons of
palm oil, about 1 tons of palm kemel oil is also obtained. We have to follow process-
manufacturing system due to our nature of raw materials and output. We have several
steps to produce palm oil and we should have to go through all the steps. A flow chart
will make our production process easy and understandable.
Processing Flow Chart
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3.7 Quality control:
We have automated quality control system. Second phase in flow chart “the refining
process” is well a quality control system. Pre bleaching and earth bleaching are two
special machines for quality control. For kernel refiner 2 is setup for quality control.
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4.1 Current scenario in Bangladesh:
Palm isn’t produce in Bangladesh till now. It imports from various country like as
Malaysia, Australia, Myanmar, Kenya etc. It’s not well refined. That’s why it’s not
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very popular in Bangladesh. This oil contains lots of TFA (Trans Fatty Acid) &
cholesterol. So it’s increase the porn of heart diseases. There is also a fact that there is
not enough prepared land for palm cultivation. We have some little amount of area in
our countries that are suitable for Palm cultivation. In those areas we started our
project & they are situated in Cox’s Bazar’s Ramu hill tracts & sea-beach area. We
refine the Palm oil using special technique rather than other vegetable oil, Soya been
oil & seed oil. For the first time we produce high quality TFA free RBD Palm olein
vegetable cooking oil in Bangladesh that the all classes of people get the right and
high quality product and will be satisfied.
4.2 Situation analysis:
• 4.2.1 Market summary:
We are the first palm production and processing company in Bangladesh. Before that
different company would have to import products from abroad. So the price rate was
probably high and our imported palm oil isn’t well refined. But now we produce well
refined palm oil and high quality RBD palm olein with feature of TFA free and sell to
clients in reasonable price. So we will have a strong demand in market.
• 4.2.2 SWOT Analysis:
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PERFORMANCE IMPORTANCE
AREAS Major
Strength
Minot
Strength
Neutral Minor
weakness
Major
weakness
Hi MED LOW
1.Marketing
Company
Reputation √
√
2. Market
Share √ √
3.Customer
Satisfaction √ √
4.Customer
Retention √ √
5.Service
Quality √ √
6.Pricing
Effectiveness √ √
7.Distaibutio
n
Effectiveness
√ √
8.Promotion
9.Innovation
10.Finance
Availability
Of Capital
√ √
11.Cash
Flow √ √
12.Financial
Salability √ √
13.Dedicated
Employees √
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STRENGTHS
 We have satisfied customer.
 We will supply TFA free High
Quality RBD Palm olein vegetable
cooking oil in local edible oil sector.
 We have good debt repayment
reputation.
 Our staffs are very much dedicated.
WEAKNESS
 New established company in
Bangladesh.
 We have least knowledge about our
market.
 Our business in the amateur
position.
OPPORTUNITIES
 Large market opportunity.
 The demand of our product is very
high.
 Government is increasing facilities
for this business.
THREATS
 Many people of our country dislike
palm oil.
 As the market is renowned as
highly profitable and easy to serve
many companies are entering the
market with some kinds offering
and features.
 We have business diversity Risk.
• 4.2.3 Marketing research:
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Introducing a new product needs market research to
about the surrounding factors. We are not beyond the
rule. Market research is to identify some facts like –
expected demand and supply condition of a product,
geographic factors and competitors position etc.
From the Bangladesh Bureau of statistics, we found
that there is a huge palm oil market in our proposed
location. It reveals that the total edible oil demand In
Cox’s bazaar is about 11,000 tones a year. This demand is met by both imported
soybean and palm oil.
• 4.2.4 Competitor analysis:
Our primary market reveals our competitive position. Our competitors are both local
and imported soybean and palm oil. We think, at the beginning, we are like a child
industry so we can’t do such thing that will influence the whole market. Here has a
matter of customer preferences. Particular group of people prefer soybean to palm oil.
The reason is that our imported palm oil is not well refined and containing a lots of
TFA. We believe, we shall produce well refined and TFA free vegetable palm olein
cooking oil and our customer will prefer to buy it.
4.3 Marketing strategy:
• 4.3.1 STP Analysis:
Market segmentation:
As a Manufacturing company we produce our product considering market basis.
Palmate palm plant (Pvt.) Ltd. finds many difficulties to segment its marketing in the
sense of mass marketing. But after thinking about our target market we decided to
segment or device our local market in 3 nature of market bellow.
 Government Market
 Private sector Market
 Import Market
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Targeting:
Our company is giving three types of products. One is palm oil, other is palm olein
and the other is kernel oil. So the target market of this company is divided into three
parts. In palm oil and palm olein sectors, the redefined target market includes General
Mass, restaurant, Hotel etc. We shall sell palm oil and palm Olein to wholesaler in a
maximum extent. A little amount will be marketed by our own facilities within Ramu
Upazilla. In kernel Oil sector our target market is soap manufacturing companies.
Here we shall not take resort to intermediaries. They are stressing, especially in the
industrial zone like Chittagong, Narayangonj and Gazipur.
In a word, our customer will be all the people of our marketing area irresponsible to
age, cost and creed.
Marketing positioning:
We are standing our business as a new organization. So we must have to concentrate
on to stay in the market. To do so, we have to set our goal. To achieve our objective
we have some strategies.
 Our delivery process will be the fastest one.
 We focus on our goal.
 We focus on our target customers.
 We analyze our competitors & take more than necessary steps for the survival of
our company in the market.
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• 4.3.2 Marketing Mix Analysis:
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Promotio
n
Advertising
Publicity
After sales
service
Promotio
n
Advertising
Publicity
After sales
service
Place
Channels
Inventory
Logistics
Place
Channels
Inventory
Logistics
Price
List Price
Discount
Allowances
Price
List Price
Discount
Allowances
Product
Brand
Packaging
Service
Product
Brand
Packaging
Service
Target
Consumer
Intended
Positioning
Target
Consumer
Intended
Positioning

Product:
• Uniqueness:
We will make our self in a position to supply TFA free High Quality RBD palm olein
vegetable cooking oil (TFA Free). We will also provide kernel oil that’s are the main
raw materials of soap manufacturing companies whose import CPKO from abroad.
• Benefits:
Our Palm oil is well-refined and fresh cooking. Our major product RBD palm olein
vegetarian Cooking oil is totally free from TFA. So it can be eaten all classes of
people. That why people get the right and high Quality product and being satisfied.
• Features:
We market tined palm oil and palm olein as well as 1,2,3 and 5 litters containers, no
importers provide this feature. The benefits are that it is easy to carry, easy to use,
easy to store and less hazardous to the retailers to retail.
Price:
• Pricing policy:
We have two competitors- imported palm oil and soybean oil. Soybean’s price always
higher than that of palm oil. In our country palm oil’s price vary from (70-80 taka)
and this variation depends on the price of international market.
Our policy is to keep our palm oil’s price always less than 10 taka by soybean oil and
the price will be same in contrast with the imported palm oil.
We are pricing normal palm oil price same as imported oil because we have a very
little market share so we can not influence market by pricing less or huge rather than
having a competitive price (Here quality will provide us competitive advantage our
palm oil is well refined than the imported oil.).
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For our major product TFA free High Quality palm olein vegetable oil, the price will
be same in contrast with the soybeans oil. For kernel oil we extend international
market price $2 or 140 taka per litter. Importers have to pay purchasing cost and
import tax, thus the price goes up. Here we get competitive advantage.
General mass will be our customer group – who mostly think about pricing. So here
we will get competitive advantage than soybean oil. Again some people consider
quality become competitive advantage which we will get from palm oil.
• Breakeven analysis:
Our first accounting period is of two years. We have to incur three years expenses
before having first production, so we decided to account all these 2 years expenses
in our production year.
First accounting period’s break-even:
Total fixed cost:
Costs Description Taka
Depreciation of equipment 3,05,00,000/25 12,20,000/=
Depreciation of building 15,00,000/25 60,000/=
Depreciation of delivery
van
15,00,000/20 75,000/=
Total fixed cost(TFC): 13,55,000/=
Total cost (TVC+TFC) = 49, 44,000+13,55,000 = 62,99,000/=
Revenues:
Products name: Description Taka
Palm oil 80(per unit) @72,000 litters 57,60,000
Kernel oil 140(per unit) @ 20,000 litters 28,00,000
Total 825,60,000
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Total variable cost:
Raw materials
Labor cost
Overhead cost
Selling expense
Administrative expense
Financial expense
2000000/=
700000/=
1000000/=
200000/=
420000/=
624000/=
Total variable cost (TVC): 49,44,000/=
45

As we are dealing with two products. It’s difficult to exactly identify the variable cost
and fixed cost for the two products.
To identify these costs, we consider revenue contribution (% ) of each product to our
total revenue. Otherwise we could do this by REVENUE MIX method.
The process is like : 85,60,000(100%) = 57,60,000( 67.29%) + 28,00,000(32.71%)
Palm oil fixed cost = 13, 55,000*67.29% = 9, 11,780tk.
Kernel oil fixed cost = 13, 55,000*32.71%= 4, 43,220tk.
Palm oil variable cost = 49, 44,000*67.29% = 33, 26,818tk.
Kernel oil variable cost = 59, 44,000*32.71% = 16, 17, 182tk.
 Break-Even For Palm Oil:
1. Mathematical equation method:
(USP*Q)-(UVC*Q)-FC=00 [Here USP= Unit selling price
Or, 80Q-46Q=FC Q= Quantity
Or, 34Q=9, 11, 780
Or, Q=26,817units UVC= Unit variable cost
FC= fixed cost]
{Variable cost per unit=3326818/72000=46tk.}
Note: our capacity is 72,000 litters/units that mean selling more than 26,816 units will
contribute 34tk. to revenue.
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2. Graphic presentation method:
 Break-even for kernel oil:
1. Mathematical equation method:
(USP*Q)- (UVC*Q)-FC=00
or, 140Q-81Q=FC {variable cost per unit=16,17,182/20000=81tk.}
or, 59Q=4,43,220
or, Q=7512units
Note: our capacity is 20,000 litters/units that mean selling more than 7512 units will
contribute 59tk. to revenue.
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2. Graphic presentation method:
• Effect of high low pricing:
Pricing is so much important for product. If we fix a high price for a product general
people will not be able to buy our product. Before fixing the product price first we
have to look our competitors company. If other companies fix the product price low
than our company, people will not buy our product. But if we fix our product in low
rate. People will not trust. They will think that there is something wrong to our
product or it is not high quality product. So we should fix our product price in level
from which we can get minimum profit and trust of people. If we can do this we can
get our market.
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Place:
• Distribution channel :
For our products we shall take resort to different
distribution channel. Soap manufacturing
companies will collect palm by their own facilities.
We also supply them by our transportation if the
location is not so far.
• Delivery terms:
Our company is a well processing company but we have also transportation facilities.
We arrange free transportation facilities for our local customer. We have also some
stepped for others customers. We give them safe transportation facilities by our own
transport system.
• Packaging and shipment:
The Palm oil which is imported in Bangladesh with packaging those all are packed in
16 litters barrel. So the importers sell the Palm oil in open market with out containers.
It isn’t well system to sell oil because it can be polluted. In these case we are packing
the oil in little containers , such as : 500ml,1litter, 2litter,3 litter,4litter & 5 litter so
that the general public can buy our oil as their need. As well as containers also
protecting oil from being polluted with air. So people getting eager to use our oil.
• Payment method:
Credit policy:
 Every business has to sell on credit; we are not beyond the policy.
 We do not sell on credit beyond 50% of the total sale.
 We do not offer the prompt payment discount.
 While considering credit to a new applicant we check his business history.
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Managing account receivable:
We are a bit relaxed in our accounts receivable collection. While selling to
wholesalers, we extend ‘N/30’ credit terms.
Managing account payable:
Our nature of business reveals that we have very little payable accounts. Our policy is
to pay payables as early as possible.
• Sales forecast:
We shall market basic product, the edible palm oil.
So we can forecast that we shall be able to sale
whatever the amount we produce. Our estimated
production of palm oil is in a year is 72,000 kg.
From market research, we found that the demand
of Cox’s for edible oil Bazaar is about 11,000
tones. So selling 72 tones is not matter of concern. So we can forecast that our
products will be sold within 6-7 months of production.
Our market research reveals that soap manufacturing companies need 1,500 tones
kernel oil in a year. While we can supply up to 20 tones.
Promotion:
Our company will enjoy a premium in promotional cost. Because, we are marketing
such a product that people need everyday. This product is a basic product like rice and
wheat.
But this doesn’t mean that we don’t need advertising. As we are starting the business,
we need to make people know that palm is being produced in our country. There is a
matter of patriotic motivation.
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• Medias:
As we are planting plants at the end of the year, we are intended to advertise our
activities through TVs for one month only. Because of this stage, we don’t need
much advertising. Three years later when palm fruit will mature to produce, we will
start our palm oil production. TV will show our palm field and finished products. We
will also use radio and newspaper to advertise. We shall take resort to cost free
method of promotion – publicity.
• Sales promotion:
If our customers order us with 1st 9 month. We will provide some discount to them.
Different types of discount will be provide, Such as
• 1st month-3rd month ---8%
• 4th month- 6th month ---5%
• 7th month -9th month ---3%
• Public relation:
We will also promote our product through public relation. To make up public relation
we select some areas. We show them with our projector how we produce our oil &
how much it will be beneficial for health
• Direct marketing:
• We can give some free oil cane to public.
• We can distribute leaf let of our company.
• We can participate in different types of fair.
• After sales service:
• If any Customer found defect in our product we will replace it instantly.
• We will exchange our product it the date is expired.
• Promotional budget:
We don’t need uninterrupted advertising. Although promotion cost is variable cost by
nature, in our firms this expense will occurs only twice. So the cost goes to only
20,000 taka on top of that, we have taken resort to cost free promotion methods
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• 4.4 Corporate social responsibility in marketing:
Business corporations were only run for profit. They were as like as “Money Making
machine” But now a day this view is changed. Government is doing some social
duties for society. So we also do some social duties for our society.
We will give 5% of annual net profit of business to institutions who work to help
the kidney patient.
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5.1 Cost of project:
Capital Requirement Amount (Tk) Amount (Tk)
Fixed Asset:
Land 20000000
Land preparation cost 1000000
Machine 30500000
Building 1500000
Delivery vehicle 1500000
Total Fixed Asset: 5,45,00000
Pre Operating Expenses:
Palm plant import &plantation cost 15000000
Start up advertising cost 200000
Total Pre operating Expenses: 17,00,000
Working capital :
Raw materials 2000000
Work in process 800000
Factory overhead 1000000
Total working capital: 38,00,000
Total capital requirement : 60,000,000
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5.2 financing plan & loan requirement:
Particulars Owner’s equity Loan Total
Fixed Capital
Land 20000000 20000000
Land preparation cost 1000000 1000000
Machine 30500000 30500000
Building 1500000 1500000
Delivery vehicle 1500000 1500000
Pre Operating Expenses:
Palm plant import &plantation
cost
15000000 15000000
Startup advertising cost 200000 200000
Working capital :
Raw materials 2000000 2000000
Work in process 800000 800000
Factory overhead 1000000 1000000
Total : 55,200,000 48,00,000 60,000,000
Percentage : 65% 35% 100%
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5.3 Means of financing:
We contribute taka 39200000 covering the cost of the leasing, Machine, Pre operating
expenses and some of working capital. A loan will be required for the rest o the
project cost.
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5.4 Loan repayment schedule:
Calculation of Installment:
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Loan
Owner’s equity

or,
or,
or,
Here
PV = Present Value
X= Installment
R= Rate of Interest
n= Number of Year
year Principal
Amount
outstanding
Installment Interest
@13%
Principal
repayment
Remaining
Balance.
1 20800000 5913743 2704000 3209743 17590257
2 17590257 5913743 2286733 3627010 13963247
3 13963247 5913743 1815222 4098521 9864726
4 9864726 5913743 1282414 4631329 5233397
5 5233397 5913743 680342 5233397 0
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20800000
20800000
5913743

5.5 Profitability Projection:
Profitability Projection
Prepare for the ending year
Particulars Amount (Tk) Amount (Tk)
Sales Revenues:
Palm oil/olein (75Tk@72000 Litter’s) 57,60,000
Kernel oil (140Tk@20000 Litter’s) 28,00,000
Total sales revenues: 85,60,000
Less: Cost of production
Raw materials 20,00,000
Labor 7,00,000
Factory overheads 10,00,000
Total cost of production: (37,00,000)
Gross Profit: 48,60,000
Less: Operating expense:
Administrative expense 4,20,000
Selling expense 2,00,000
Total Operating expense: (6,20,000)
Operating profit(EBIT): 42,40,000
Less:
Financial expenses 27,04,000
Depreciation 13,55,000
(40,59,000)
Earning before tax (EBT): 1,81,000
Less: Provision for taxation (40%) (72,400)
Profit After Tax: (EAT) 1,08,600
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5.6 Projected income statement:
Projected income statement
Particulars Year -1 Year -2 Year -3 Year -4 Year -5
Palm Oil/Olein
(80 Tk Per
Unit/Litter)
Litter Litter Litter Litter Litter
72000 72400 72600 72800 80000
Kernel Oil (140 Tk
per Unit/Litter)
20,000 22000 24000 26000 28000
Sales Revenue 8560000 8872000 9168000 9464000 1032000
Less: Cost of production
Raw Materials 2000000 2250000 260000 2270000 2280000
Labor Cost 700000 700000 700000 700000 700000
Overhead Cost 1000000 1000000 1000000 1000000 1000000
Total Production
Cost
(3700000) (3950000) (3960000) (3970000) (3980000)
Gross Profit 4860000 4922000 5208000 5494000 6340000
Less:
Administrative
Expenses
420000 420000 420000 420000 420000
Selling Expenses 200000 200000 200000 200000 200000
Total Operating
Expenses
(620000) (620000) (620000) (620000) (620000)
Operating Profit 4240000 4302000 4588000 4874000 5720000
Less:
Financial Expenses 2704000 2286733 1815222 1282414 680342
Depreciation 1355000 1355000 1355000 1355000 1355000
Earnings Before Tax 181000 660267 1417778 2236586 3684658
Less:
Provision for Taxation
(40%)
72400 264107 567111 894634 1473863
Profit After Tax 108600 396160 850667 1341952 2210795
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61

Conclusion
We will start a new business company which name is Palmate Palm Plant (Pvt.) Ltd.
it is the first Palm Production & Processing Company in our country. Though it is the
first palm production and processing company, so it will create a new situation in this
sector. It will reduce the importing cost of edible oil market and fulfill the demand of
local market. Our company will also make contribution toward the economy. We can
give service to the customers quickly. We can reduce unemployment & illiteracy
problem. We will give best service low price comparing than other company. We
want to improve our society through our company.
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62

Bibliography
For preparing this report we did not/took any/help of primary source. We only
collected the information from some web pages and books.
Primary sources: Nil
Secondary Sources:
 Web pages:
• www.fao.org
• www.chgs.com
• www.palmplantation.org
• www.hvainternational.nl
• www.uga.com
• www.squ.edu
• En.wikipedia.org
With other web-pages searched by google.
 Books:
• Magazines like Malayasian Palm oil fortune VOL-4 April 2009
• “Crude oil” written by Ellie Brown.Phd
• Statistical Year Book of Bangladesh 2006
 Others:
A format for presenting business plan is given by Mohammad Mosharaf
Hossain, Lecturer of Dhaka City College.
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Glossary
Some short codes are used in our report as short of a long sentence. The full meaning
of those short codes is as a below
 PPP = Palmate Palm Plant
 FFB = Fresh Fruit Bunch
 RBD = Refined Bleached Deodorized
 SWOT = Strength , Weakness , Opportunity,Threats
 STP = Segmentation, Targeting, Positioning
 TFA = Trans Fatty Acid
 BBS = Bangladesh Bureau Of Statistics
 COGS = Cost of Goods Sales
 CPO = Crude Palm Oil
 CPKO = Crude Palm Kernel Oil
 EBIT = Earnings Before Interest and Tax
 EBT = Earnings Before Tax
 EAT = Earnings After Tax
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65

Palm production & processing

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