Pre-Feasibility Study

FOOD CORNER ON WHEELS

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 REGIONAL OFFICE REGIONAL OFFICE REGIONAL OFFICE

PUNJAB SINDH KHYBER PAKHTUNKHWA BALOCHISTAN

3rd Floor, Building No. 3, 5TH Floor, Bahria Ground Floor Bungalow No. 15-A
Aiwan-e-Iqbal Complex, Complex II, M.T. Khan Road, State Life Building Chaman Housing Scheme
Egerton Road Lahore, Karachi. The Mall, Peshawar. Airport Road, Quetta.
Tel: (042) 111-111-456 Tel: (021) 111-111-456 Tel: (091) 9213046-47 Tel: (081) 831623, 831702
Fax: (042) 36304926-7 Fax: (021) 5610572 Fax: (091) 286908 Fax: (081) 831922
helpdesk.punjab@smeda.org.pk helpdesk-khi@smeda.org.pk helpdesk-pew@smeda.org.pk helpdesk-qta@smeda.org.pk

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TABLE OF CONTENTS
1 DISCLAIMER .................................................................................................... 2
2 EXECUTIVE SUMMARY ................................................................................... 3
3 INTRODUCTION TO SMEDA ........................................................................... 3
4 PURPOSE OF THE DOCUMENT ..................................................................... 4
5 BRIEF DESCRIPTION OF PROJECT & PRODUCT ........................................ 4
5.1 Business Operations Process Flow .......................................................... 5
5.2 Installed and Operational Serving Capacity .............................................. 6
6 CRITICAL FACTORS ....................................................................................... 7
7 GEOGRAPHICAL POTENTIAL FOR INVESTMENT ....................................... 8
8 POTENTIAL TARGET CUSTOMERS / MARKETS .......................................... 8
9 PROJECT COST SUMMARY ........................................................................... 8
9.1 Project Economics .................................................................................... 9
9.2 Project Cost ............................................................................................ 10
9.3 Food Truck Requirement ........................................................................ 10
9.4 Machinery & Equipment Requirement .................................................... 11
9.5 Computer Equipment Requirement ........................................................ 12
9.6 Furniture & Fixtures Requirement ........................................................... 12
9.7 Raw Material Requirement ..................................................................... 12
9.8 Human Resource Requirement .............................................................. 12
9.9 Utilities And Other Costs ......................................................................... 13
9.10 Revenue Generation............................................................................... 13
10 CONTACT DETAILS....................................................................................... 14
11 USEFUL WEB LINKS ..................................................................................... 14
12 ANNEXURES .................................................................................................. 16
12.1 Income Statement................................................................................... 16
12.2 Balance Sheet ........................................................................................ 17
12.3 Cash Flow Statement ............................................................................. 18
12.4 Raw Material Requirements ................................................................... 19
13 KEY ASSUMPTIONS ...................................................................................... 21
13.1 Operating Cost Assumptions .................................................................. 21
13.2 Production Cost Assumptions ................................................................. 21
13.3 Revenue Assumptions ............................................................................ 22

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1 DISCLAIMER

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

general idea and information on the said matter. 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 taken 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

Document Control

Document No. PREF-NO 183

Prepared by SMEDA Punjab – OS

Revision Date February, 2021

For information helpdesk.punjab@smeda.org.pk

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2 EXECUTIVE SUMMARY

The concept of a ‘Food Corner on Wheels’ is an emerging trend and gaining popularity
among the masses. It is basically a small size restaurant that uses movable food
vehicle to sell various menu of foods; basically, meals and fast-food items to customers
on the go.
This particular pre-feasibility study provides basic information for setting up a ‘Food
Corner on Wheels’ in any major city of Pakistan. The proposed unit will comprised of
a movable food truck, which will be equipped to cook and serve good quality ready to
eat meals to customers. The menu of the food corner is proposed to be fast food items,
mainly Burgers, Pizza, Shawarma, Wraps & Rolls, Fried Chicken, Nuggets,
Sandwiches and French Fries along with Soft Drinks.
The proposed food corner will have the capacity to prepare and serve around
1,171,548 servings per annum with 8 hours operation per day round the year.
However, starting operational capacity is assumed at 30% with gradual increase of 5%
in subsequent years up to maximum capacity utilization of 75% (i.e. 878,661 servings).
The serving capacity is estimated to be economically viable and justifies the capital as
well as operational cost of the project. However, entrepreneur’s knowledge of food
business, taste and quality of food and selection of appropriate locations are key
factors for the success of this venture.
Total project cost is estimated as Rs. 7.601 million with capital investment of Rs. 6.964
million and working capital of Rs. 0.637 million. Based on an equity finance model, the
project NPV is around Rs. 26.031 million, with an IRR of 58% and Payback Period of
2.57 years. The project will provide employment opportunities to 10 people including
the Owner. The legal business status of this project is assumed to be ‘Sole
Proprietorship’.

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
and institutional collaboration and networking initiatives.
Preparation and dissemination of prefeasibility studies in key areas of investment has
been a successful hallmark of SME facilitation by SMEDA.

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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 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 Food Corner on
Wheels 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, which form basis of any Investment Decision.

5 BRIEF DESCRIPTION OF PROJECT & PRODUCT

The trend of setting up ‘Food Trucks’ and ‘Food Corner on Wheels’ have progressed
in many cities. It is an efficient business model that is driven by technology and
succeeds on customer demand for low-cost, convenient and quality food. Modern food
trucks offer diverse and high quality meals which involve certain on-site food
preparations. With relatively low-barriers to entry, lower capital cost and flexibility to
operate at multiple locations are key advantages for initiating food truck business in
comparison to traditional restaurants.
The proposed project envisages the setup of a ‘Food Corner on Wheels’ business
utilising a moveable truck, which mainly cater to serve the quality and hygienic meals
to the customers at competitive prices. The menu of food corner will comprises of fast
food items mainly, Burgers, Sandwiches, French Fries, Pizzas, Shawarmas, Paratha
Rolls, Nuggets along with Soft Drinks. Individual food items as per the menu along with
value meals and deals will be offered to the customers.
For this purposes, a mini truck will be purchased and renovated along with installations
of necessary kitchen machinery on turnkey basis. The proposed food truck will be
equipped with Pizza Oven, Fryers, Shawarma Grill, Stoves, Hot Pans and Other
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Cooking Items; 5 KVA Generator is also installed in the truck to provide uninterrupted
electricity. Moreover, deep freezer and refrigerator will also be fitted in the truck to store
raw material, meal ingredients and chilling of soft drinks. Apart from the stated
machinery the food truck will house a window for order taking, meal delivering and
cash receiving purposes.
The proposed food truck should be parked at 3 to 5 different locations in different time
slots after obtaining the requisite food service permits and certificates from the
regulating authorities. Densely populated areas in surrounding of commercial markets
and business centres of major cities would be most suitable location for regular
parking. Whereas, active marketing through social media i.e. Facebook, Instagram,
Twitter etc, should be done to attract the customers.
Financial analysis shows the unit shall be profitable from the very first year of operation.
The legal status is proposed to be ‘Sole Proprietorship’.

5.1 Business Operations Process Flow

The brief overview of the business operations process flow of proposed ‘Food Corner
on Wheels’ mainly comprises of the following steps.
Raw Material Procurement
Raw material for the fast-food items is purchased according to their graded shelf
life. Some material like potatoes, onions, spices and sausages can be purchased
in bulk and stored for a longer period than chicken, mince and other perishable
items which will be procured on daily basis.
Cleaning and Storing
Procured material is washed and sorted in containers for processing and cutting
of each item according to their use.
Initial Processing / Cutting
The precleaned chicken and beef, mince, potatoes, tomatoes, onions and salad
material is cut into desired sizes and quantities. Chicken and beef patties and
pieces are marinated.
Storage
The semi processed food items like chicken patties, chicken pieces, salads,
sausages and spices are put into containers and get them ready for loading into
food truck.
Loading in Food Truck
Already packed containers of food items are loaded into food truck’s special
purpose compartments. The containers are loaded into the truck according to

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their shelf-life quality. Chicken patties and chicken pieces will be stored in pre-
installed refrigerator on the food truck.
Order Taking and Cooking
When the truck is reached on the designated location, waiter takes orders from
customers. The food and meals are prepared / cooked in onboard kitchen facility
as per the customer orders.
Serving
Finally, the food is served to the customers when it gets prepared and the same
process repeats on recurring basis.
Figure 1: Process Flow

Initial
Raw Material Cleaning and
Processing/cutti
Procurement Storing
ng

Order Taking Loading in Food

Storage
and Cooking Truck

Serving

5.2 Installed and Operational Serving Capacity

For the proposed ‘Food Corner on Wheels’ moveable mini truck will be used. The
minitruck will be customized with onboard kitchen facility as per the business
requirements. According to estimates, the proposed food truck will have an installed
capacity of preparing 1,171,548 servings per annum. However, initial operational
capacity of the project will be 30% with an annual growth of 5%. Maximum capacity
utilization of the project is assumed at 75%.
The food items wise operational serving capacity is provided in the table below.

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Table 1: Operational Serving Capacity

Serving Capacity Maximum Serving

Description
– Year 1 (30%) Capacity – Year 10 (75%)
Shawarma 10,800 27,000
Paratha Roll 10,800 27,000
Zinger Burger with Fries 8,640 21,600
Chicken Burger with Fries 8,640 21,600
Beef Burger with Fries 8,640 21,600
Fried Chicken with Fries (Kgs.) 51,840 129,600
Fries (115 gm per serving) 209,059 522,647
Pizza Large 2,592 6,480
Pizza Medium 3,888 9,720
Pizza Small 6,480 16,200
Club Sandwich with Fries 10,800 27,000
Chicken Sandwich with Fries 10,800 27,000
Nuggets (140 gm per serving) 8,486 21,214
Total 351,465 878,661

6 CRITICAL FACTORS

Following are the factors critical for the success of this business venture:
 Background knowledge and related experience of the entrepreneur in restaurant
management or food business.
 Selection of quality ingredients for food preparation with special focus on the
planning and forecasting the right amount of items to be ordered.
 Choosing the right location for the regular parking spot of the food truck. Good
visibility can create opportunities for the impulse eating decision that is critical for
fast food operators.
 Creating the right menu and competitive pricing.
 Compliance with standards and obtaining license from Food Authorities.
 Develop strong linkages with raw material suppliers for sourcing quality material on
time at economical prices.

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 Maintaining the best agronomy practices and hygiene standards.

 Induction of trained human resource (experienced cooks and staff) for quality food
and good service delivery.
 Exceed customer expectations by offering high quality products at reasonable
prices.
 Effective marketing and promotion through social and electronic media.
 Employ careful financial and accounting analysis to ensure efficiency and proper
controls.

7 GEOGRAPHICAL POTENTIAL FOR INVESTMENT

Mobility is one of the key advantages of the proposed food corner on wheels business
venture. It can meet its customers where they are. However, it’s also important that
customers know where it is and can find it easily. Many food trucks have a go-to spot
where they park with some regularity. This regular spot is proposed to be established
at a location that has a continuous stream of traffic, convenient parking and is in
proximity to other businesses, preferably near densely populated middle income group
areas.
Major cities like Karachi, Lahore, Faisalabad, Islamabad, Multan, Gujranwala, Sialkot,
Rawalpindi, Peshawar and Quetta etc. are most suitable to initiate the proposed
project.

8 POTENTIAL TARGET CUSTOMERS / MARKETS

Middle income group people, especially working class and students, living in major
cities like Karachi, Lahore, Faisalabad, Islamabad, Multan, Gujranwala, Sialkot,
Rawalpindi, Peshawar and Quetta etc. are the major target customers for the proposed
food corner. Subsequently, online booking and free delivery service will help in target
more customers.

9 PROJECT COST SUMMARY

A detailed financial model has been developed to analyze the commercial viability of
‘Food Corner on Wheels’. 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 annexures.

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9.1 Project Economics

All the figures in this financial model have been calculated for the estimated sales of
Rs. 46.920 million in the year one. The capacity utilization during year one is worked
out at 30%.
The following table shows the internal rate of return, payback period and net present
value of the proposed venture.
Table 2: Project Economics

Description Details

Internal Rate of Return (IRR) 58%

Payback Period (Yrs.) 2.57

Net Present Value (Rs.) 26,031,029

Calculation of break-even analysis is as follows:

Table 3: Breakeven (100% Equity-Based)
Break-Even
Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
Analysis

Break-Even
39,999,444 38,319,791 38,085,349 38,832,897 40,261,716 42,116,741 44,713,252 47,775,446 51,339,366 55,443,774
Revenue

Break-Even Units 231,211 201,365 181,939 168,646 158,955 151,163 145,893 141,713 138,440 135,917

Margin of Safety 15% 35% 47% 55% 61% 65% 68% 71% 73% 74%

However, for the purposes of further explanation the Project Economics based on
Debt:Equity (i.e. 50:50) Model has also been computed. Based on Debt:Equity model
the Internal Rate of Return, Payback Period and Net Present Value of the proposed
project are provide in the table below.
Table 4: Project Economics Based on Debt (50%):Equity (50%)

Description Details

Internal Rate of Return (IRR) 57%

Payback Period (Yrs.) 2.61

Net Present Value (Rs.) 35,445,706

The financial assumptions for Debt:Equity are as follows:

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Table 5: Financial Assumptions for Debt:Equity Model

Description Details

Debt (50%) 3,800,331

Equity (50%) 3,800,331

Interest Rate on Debt 12%

Debt Tenure 5

Debt Payment / Year 2

The projected Income Statement, Cash Flow Statement and Balance Sheet enclosed
as annexures are based on 100% Equity Based Business Model.

9.2 Project Cost

Following fixed and working capital requirements have been identified for operations
of the proposed business.
Table 6: Project Cost

Description Amount Rs.

Capital Cost
Food Truck – Customized Mini Truck 6,565,000
Machinery & Equipment 133,000
Pre-Operating Costs 140,000
Computer Equipment 73,000
Furniture & Fixtures 52,600
Total Capital Cost 6,963,600
Cash 637,062
Total Working Capital 637,062
Total Project Cost 7,600,662

9.3 Food Truck Requirement

For the proposed ‘Food Corner on Wheels’ moveable mini truck will be used. The
minitruck will be customized with onboard kitchen facility as per the business
requirements. The estimated cost of the truck with required customization is Rs. 6.57
million.
The on board kitchen facility in the truck will be equipped with following items:

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 Pizza Oven
 Deep Fat Fryer
 Under Counter Chiller
 Char Coal Grill
 Hot Plate
 Shawarma Machine
 Dough Machine
 Exhaust Blower
 Sink Table Double Bowl
 Panini Grill
 Working Table
 Pizza Pre Under Counter Chiller
 Upright Chiller – Double Door
 Exhaust Hood
 Working Table Under Cabinet
 Working Table With Cash Drawer
 Pizza Over Under Cabinet Table
In addition to the above, the customized truck will also have the following installations:
 Point of Sale – Cash Machine
 Air Conditioned – Interior
 Fully Fabricated / Painted / Vinyl Pasting
 Clean Water Tank – 500 Liters
 Disposable Water Tank – 500 Liters
 Main DB (Distribution Board) For Wapda Supply
 Diesel Generator 5 KVA

9.4 Machinery & Equipment Requirement

The machinery and equipment required for the proposed project is stated below.
Table 7: Machinery & Equipment

Unit Cost Total Cost

Description
(Rs.) (Rs.)

Cutting Knifes, Kitchen Utensils, Grinder,

Lumpsum 100,000
Mixers etc.
LPG Cylinder 45 Kg (Qty:3) 11,000 33,000
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Total 133,000

9.5 Computer Equipment Requirement

Following computer equipment will be required for the project.
Table 8: Computer Equipment

Unit Cost Total Cost

Description Quantity
(Rs.) (Rs.)
Computers 45,000 45,000 45,000
Invoice Printer 8,000 8,000 8,000
Computer Printer 20,000 20,000 20,000
Total 73,000

9.6 Furniture & Fixtures Requirement

Details of the furniture and fixture required for the project are given below.
Table 9: Furniture & Fixture

Unit Cost Total Cost

Description Quantity
(Rs.) (Rs.)
Stools / Chairs 7 1,800 12,600
Table and Chair Sets 4 10,000 40,000
Total 52,600

9.7 Raw Material Requirement

The major raw materials required for the proposed venture mainly includes, chicken,
meat, oil, potato, margination materials as per the recipe and other food ingredients
and spices along with soft drinks. All the required raw materials will be procured locally.
Special focus by the owner / manager will be on inventory management. Excess
inventory of raw material is not desirable because of limited storage space and limited
shelf-life period.
According to the menu offered by the proposed unit, the raw materials required for
each product along with estimated costs are provided as Annexure12.4. The cost of
raw material is assumed to increase 7% annually.

9.8 Human Resource Requirement

In order to run operations of Food Corner On Wheels Business, details of human
resources required along with number of employees and monthly salary are
recommended as under.
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Table 10: Human Resource Requirment

Monthly Salary
Description No. of Employees
per Person (Rs.)
Owner / Manager 1 80,000
Chef 1 65,000
Cook 5 35,000
Waiter 2 20,000
Security Guards 1 20,000
Total 10

9.9 Utilities and Other Costs

An essential cost to be borne by the project is the cost of fuel and gas. The electricity
fuel and gas expenses are estimated to be around Rs.74,604 (Direct) per month.
Furthermore, promotional expense being essential for marketing, is estimated as 2%
of revenue.

9.10 Revenue Generation

Based on the capacity utilization of 30%, sales revenue during the first year of
operations is provided in the table below.
Table 11: Revenue Generation – Year 1

Meals to be Sale Price Sales Revenue

Description
Served (No) / Unit (Rs.) (Rs.)

Shawarma 10,800 130 1,404,000

Paratha Roll 10,800 130 1,404,000
Zinger Burger with Fries 8,640 230 1,987,200
Chicken Burger with Fries 8,640 210 1,814,400
Beef Burger with Fries 8,640 235 2,030,400
Fried Chicken with Fries 51,840 140 7,257,600
Fries (115 gm per Serving) 209,059 90 18,815,310
Pizza Large 2,592 850 2,203,200
Pizza Medium 3,888 650 2,527,200
Pizza Small 6,480 380 2,462,400
Club Sandwich with Fries 10,800 200 2,160,000

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Chicken Sandwich with Fries 10,800 170 1,836,000

Nuggets (140 gm per 8,486 120 1,018,320
Serving)
Total 351,465 46,920,030

10 CONTACT DETAILS

In order to facilitate potential investors, contact details of machinery supplier relevant

to the proposed project is given below.
Table 12: Machinery Supplier

Name of Supplier Address Phone

Plot No. 34 Industrial Area

First Bus Private Limited +92 343 5213 430-3
Green Town Lahore

11 USEFUL WEB LINKS

Small & Medium Enterprises Development

www.smeda.org.pk
Authority (SMEDA)
Government of Pakistan www.pakistan.gov.pk
Ministry of Industries & Production www.moip.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 Baluchistan 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
www.tdap.gov.pk
(TDAP)
Security Commission of Pakistan (SECP) www.secp.gov.pk
Federation of Pakistan Chambers of
www.fpcci.com.pk
Commerce and Industry (FPCCI)
State Bank of Pakistan (SBP) www.sbp.org.pk
Punjab Small Industries Corporation www.psic.gop.pk

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Sindh Small Industries Corporation www.ssic.gos.pk

Ministry of National Food Security &
www.mnfsr.gov.pk
Research
Punjab Food Authority www.pfa.gop.pk
Sindh food Authority www.sfa.gos.pk
Khyber Pakhtunkhwa Food Safety & Halal
www.kpfsa.gov.pk
Food Authority
All Pakistan Restaurant Association www.apra.org.pk

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12 ANNEXURES

12.1 Income Statement

Calculations SMEDA
Income Statement

Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
Revenue 46,920,030 58,571,779 71,624,864 86,218,526 102,504,182 120,647,360 140,828,311 163,243,616 188,106,800 215,651,100

Cost of sales
Cost of goods sold 1 36,479,433 45,538,448 55,686,975 67,033,267 79,695,056 93,801,034 109,491,342 126,918,811 146,249,465 167,664,645
Direct labour 3,360,000 3,696,000 4,065,600 4,472,160 4,919,376 5,411,314 5,952,445 6,547,689 7,202,458 7,922,704
Machinery maintenance 164,125 180,538 198,591 218,450 240,295 264,325 290,757 319,833 351,817 386,998
Direct fuel 98,475 126,376 158,873 196,605 240,295 290,757 348,909 415,783 492,543 580,497
Generator fuel 639,360 703,296 773,626 850,988 936,087 1,029,696 1,132,665 1,245,932 1,370,525 1,507,577
Direct water 24,000 26,400 29,040 31,944 35,138 38,652 42,517 46,769 51,446 56,591
Direct gas 157,410 192,827 231,393 273,333 318,888 368,316 421,889 479,899 542,655 610,486
Total cost of sales 40,922,803 50,463,885 61,144,098 73,076,747 86,385,137 101,204,093 117,680,525 135,974,716 156,260,909 178,729,500
Gross Profit 5,997,227 8,107,894 10,480,766 13,141,779 16,119,046 19,443,266 23,147,786 27,268,900 31,845,891 36,921,600

General administration & selling expenses

Administration expense 1,200,000 1,320,000 1,452,000 1,597,200 1,756,920 1,932,612 2,125,873 2,338,461 2,572,307 2,829,537
Water expense 144,000 158,400 174,240 191,664 210,830 231,913 255,105 280,615 308,677 339,544
Communications expense (phone, fax, mail, internet, etc.) 120,000 132,000 145,200 159,720 175,692 193,261 212,587 233,846 257,231 282,954
Office vehicles running expense 656,500 722,150 794,365 873,802 961,182 1,057,300 1,163,030 1,279,333 1,407,266 1,547,993
Office expenses (stationary, entertainment, janitorial services, etc.) 72,000 79,200 87,120 95,832 105,415 115,957 127,552 140,308 154,338 169,772
Promotional expense Year 938,401 750,720 600,576 480,461 384,369 307,495 245,996 196,797 157,437 125,950
Professional fees (legal, audit, consultants, etc.) 234,600 292,859 358,124 431,093 512,521 603,237 704,142 816,218 940,534 1,078,256
Depreciation expense 699,150 699,150 699,150 703,677 702,947 702,947 708,188 707,343 707,343 713,410
Amortization of pre-operating costs 28,000 28,000 28,000 28,000 28,000 - - - - -
Parking cost 720,000 792,000 871,200 958,320 1,054,152 1,159,567 1,275,524 1,403,076 1,543,384 1,697,722
Miscellaneous expense 1 300,000 330,000 363,000 399,300 439,230 483,153 531,468 584,615 643,077 707,384
Subtotal 5,112,651 5,304,479 5,572,976 5,919,068 6,331,258 6,787,442 7,349,465 7,980,612 8,691,593 9,492,522
Operating Income 884,576 2,803,414 4,907,790 7,222,711 9,787,788 12,655,824 15,798,321 19,288,289 23,154,297 27,429,078

Other income (interest on cash) 35,997 97,037 198,125 339,837 525,359 757,155 1,041,697 1,386,196 1,795,682 2,279,056
Other income 2
Gain / (loss) on sale of computer equipment - - 18,250 - - 39,377 - - 63,833 50,961
Earnings Before Interest & Taxes 920,573 2,900,451 5,124,166 7,562,547 10,313,147 13,452,356 16,840,018 20,674,485 25,013,812 29,759,095
Earnings Before Tax 920,573 2,900,451 5,124,166 7,562,547 10,313,147 13,452,356 16,840,018 20,674,485 25,013,812 29,759,095

Tax 42,057 350,090 957,250 1,766,891 2,729,601 3,828,324 5,014,006 6,356,069 7,874,834 9,535,683
NET PROFIT/(LOSS) AFTER TAX 878,516 2,550,361 4,166,916 5,795,656 7,583,546 9,624,031 11,826,012 14,318,416 17,138,978 20,223,412

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12.2 Balance Sheet

Calculations SMEDA
Balance Sheet

Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
Assets
Current assets
Cash & Bank 637,062 2,242,728 5,520,239 10,329,798 16,857,132 25,171,625 35,400,777 47,934,977 62,960,735 80,693,810 101,630,631
Total Current Assets 637,062 2,242,728 5,520,239 10,329,798 16,857,132 25,171,625 35,400,777 47,934,977 62,960,735 80,693,810 101,630,631

Machinery & equipment 133,000 119,700 106,400 93,100 79,800 66,500 53,200 39,900 26,600 13,300 -
Furniture & fixtures 52,600 47,340 42,080 36,820 31,560 26,300 21,040 15,780 10,520 5,260 -
Office vehicles 6,565,000 5,908,500 5,252,000 4,595,500 3,939,000 3,282,500 2,626,000 1,969,500 1,313,000 656,500 -
Computer equipment 73,000 48,910 24,820 85,237 56,619 28,732 98,672 65,544 33,261 114,225 75,875
Total Fixed Assets 6,823,600 6,124,450 5,425,300 4,810,657 4,106,979 3,404,032 2,798,912 2,090,724 1,383,381 789,285 75,875

Intangible assets
Pre-operation costs 140,000 112,000 84,000 56,000 28,000 - - - - - -
Total Intangible Assets 140,000 112,000 84,000 56,000 28,000 - - - - - -
TOTAL ASSETS 7,600,662 8,479,178 11,029,539 15,196,455 20,992,111 28,575,657 38,199,689 50,025,701 64,344,116 81,483,095 101,706,507

Liabilities & Shareholders' Equity

Shareholders' equity
Paid-up capital 7,600,662 7,600,662 7,600,662 7,600,662 7,600,662 7,600,662 7,600,662 7,600,662 7,600,662 7,600,662 7,600,662
Retained earnings 878,516 3,428,877 7,595,793 13,391,449 20,974,995 30,599,027 42,425,039 56,743,454 73,882,433 94,105,845
Total Equity 7,600,662 8,479,178 11,029,539 15,196,455 20,992,111 28,575,657 38,199,689 50,025,701 64,344,116 81,483,095 101,706,507
TOTAL CAPITAL AND LIABILITIES 7,600,662 8,479,178 11,029,539 15,196,455 20,992,111 28,575,657 38,199,689 50,025,701 64,344,116 81,483,095 101,706,507

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12.3 Cash Flow Statement

Calculations SMEDA
Cash Flow Statement

Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
Operating activities
Net profit 878,516 2,550,361 4,166,916 5,795,656 7,583,546 9,624,031 11,826,012 14,318,416 17,138,978 20,223,412
Add: depreciation expense 699,150 699,150 699,150 703,677 702,947 702,947 708,188 707,343 707,343 713,410
amortization of pre-operating costs 28,000 28,000 28,000 28,000 28,000 - - - - -
Cash provided by operations - 1,605,666 3,277,511 4,894,066 6,527,333 8,314,493 10,326,979 12,534,200 15,025,759 17,846,321 20,936,822

Financing activities
Issuance of shares 7,600,662 - - - - - - - - - -
Cash provided by / (used for) financing activities 7,600,662 - - - - - - - - - -

Investing activities
Capital expenditure (6,963,600) - - (84,507) - - (97,827) - - (113,247) -
Cash (used for) / provided by investing activities (6,963,600) - - (84,507) - - (97,827) - - (113,247) -

NET CASH 637,062 1,605,666 3,277,511 4,809,559 6,527,333 8,314,493 10,229,152 12,534,200 15,025,759 17,733,074 20,936,822

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12.4 Raw Material Requirements

Shawarma Paratha Roll Zinger Burger Chicken Burger Beef Burger Fried Chicken Fries
Input Material Qty. Rate Amount Qty. Rate Amount Qty. Rate Amount Qty. Rate Amount Qty. Rate Amount Qty. Rate Amount Qty. Rate Amount
Garlic White Sauce 1 500 500 1 500 500 - 500 - 500 - 500 - 500 - 500 -
Red Cihilli sauce 1 100 100 1 100 100 - 100 - 100 - 100 - 100 - 100 -
Pickles/Vegetable 1 200 200 1 200 200 - 200 - 200 - 200 - 200 - 200 -
Chicken Masalah 1 185 185 1 185 185 0 185 74 0 185 74 - 185 - 0 185 74 185 -
Beef Masalah 178 - 178 - 178 178 0 178 71 178 178
Chicken Boneless 5 375 1,875 5 375 1,875 1 375 488 1 375 413 375 375 - 375 -
Chicken per kg - 230 - 230 - 230 230 230 1 230 230 230
Beef Mince 600 - 600 - 600 600 1 600 660 600 600
Shawarma Bread 50 15 750
Bread 6 50 6 292
Burger - 15 - - 15 - 10 15 150 10 15 150 10 15 150 - 15 - 15 -
Mayonese 270 - 270 - 0 270 68 0 270 68 0 270 68 - 270 - 270 -
Ketchup 250 - 250 - 0 250 43 0 250 43 0 250 43 - 250 - 250 -
Oil 250 - 1 250 250 1 250 188 0 250 100 0 250 100 1 250 125 1 250 188
Chicken coating 300 - 300 - 1 300 150 300 300 0 300 90 300
Potato Fries 380 - 380 - - 380 - 380 - 380 - 380 - 1 380 380
Fries Masalah 10 - 10 - - 10 - 10 - 10 - 10 - 1 10 10
Other Miscalleneous 1,000 250 1,000 250 - 1,000 50 1,000 150 1,000 150 1,000 100 1,000 -
Other Costs:
Packing Cost 50 2 100 50 1 50 10 10 100 10 10 100 10 10 100 8 10 80 9 7 66
Fries in Deal 10 50 500 10 50 500 10 50 500 8 25 200

Raw Material Cost 3,960 3,702 1,809 1,597 1,841 899 644

Output (With Qty Unit Qty Unit Qty Unit Qty Unit Qty Unit Qty Unit Qty Unit
above input
materials) 50 Shawarmas 50 Rolls 10 Burgers 10 Burgers 10 Burgers 8 Servings 8.70 Servings

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Pizza (Large) Pizza (Medium) Pizza (Small) Club Sandwich Chicken Sandwich Nuggets
Input Material Qty. Rate Amount Qty. Rate Amount Qty. Rate Amount Qty. Rate Amount Qty. Rate Amount Qty. Rate Amount
Chicken Masalah 0.4 185 74.0 0.3 185 55.5 0.3 185 46.3 0.1 185 17 0.1 185 17 0.5 185 93
Chicken Boneless 1.8 375 675 1.5 375 562.5 0.8 375 281.3 0.4 375 150 0.8 375 300 1.0 375 375
Pizza Dough 6.0 70 420 6.0 56 336.0 6.0 42 252.0 70 70 70
Bread 24 6 140 32 6 187
Mayonese - 270 - - 270 - - 270 - 0.5 270 135 0.1 270 32 - 270 -
Ketchup 0.3 250 75 0.3 250 62.5 0.2 250 50.0 - 250 - - 250 - - 250 -
Oil 0.3 250 63 0.2 250 50.0 0.2 250 37.5 0.3 250 63 - 250 - 0.3 250 63
Toppings etc. 6.0 100 600 6.0 80 480.0 6.0 50 300.0 1.0 100 100 - 100 - - 100 -
Cheese for topping 1.5 900 1,350 1.2 900 1,080.0 0.8 900 675.0 - 900 - - 900 - - 900 -
Eggs - 15 - 15 15 8.0 15 120 - 15 - - 15 -
Salt - 0.3 - 0.3 0.3 8.0 0.3 2.0 8.0 0.3 2 - 0.3 -
Black Pepper - 1.3 - 1.3 1.3 8.0 1.3 10.0 8.0 1.3 10 - 1.3 -
Other Miscalleneous 1,000 180 1,000 120 1,000 60 - 1,000 40 - 1,000 40 - 1,000 20
Other Costs:
Packing Cost 6.0 20.0 120.0 6.0 16.7 100.0 6.0 13.3 80.0 8.0 10.0 80 8.0 10.0 80 7.0 10.0 70
Fries in Deal 8.0 40.0 320 8.0 40.0 320

Raw Material Cost 3,557 2,847 1,782 1,176 988 620

Output (With Qty Unit Qty Unit Qty Unit Qty Unit Qty Unit Qty Unit
above input 6 Pizza 6 Pizza 6 Pizza 8 Sandwich 8 Sandwich 7 Servings

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13 KEY ASSUMPTIONS

13.1 Operating Cost Assumptions

Description Details

Mini Truck running expense 10% of vehicles cost

Communication Expenses 10 % of administration expense
Promotional Expenses 2% of revenue
Depreciation Method Straight line
Depreciation Rate 10% on Machinery & Equipment
33% on Computer equipment
10% on Furniture & Fixture
10% on vehicles
Inflation Growth Rate 10%
Salaries Growth Rate 10%
Gas price growth rate 5%

13.2 Production Cost Assumptions

Description Details

Maximum Serving Capacity 1,171,548

Serving Capacity in First Year 30%
Increase in Serving Capacity Per Year 5%
Maximum Serving Capacity 75%
Per Unit Cost of Raw Material & Packing
Shawarma Rs. 79
Paratha Roll Rs. 74
Zinger Burger with Fries Rs.181
Chicken Burger with Fries Rs.160
Beef Burger with Fries Rs.184
Fried Chicken with Fries Rs.112
Fries (115 gm per Serving) Rs.74

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Pizza Large Rs.593

Pizza Medium Rs.474
Pizza Small Rs.297
Club Sandwich with Fries Rs.147
Chicken Sandwich with Fries Rs.123
Nuggets (140 gm per Serving) Rs.89

13.3 Revenue Assumptions

Description Details

Sale Price Growth Rate 7%

Capacity Utilization 30%
Sales Price Per Meal
Shawarma Rs.130
Paratha Roll Rs.130
Zinger Burger with Fries Rs.230
Chicken Burger with Fries Rs.210
Beef Burger with Fries Rs.235
Fried Chicken with Fries Rs.140
Fries (115 gm per Serving) Rs.90
Pizza Large Rs.850
Pizza Medium Rs.650
Pizza Small Rs.380
Club Sandwich with Fries Rs.200
Chicken Sandwich with Fries Rs.170
Nuggets (140 gm per Serving) Rs.120

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