A75s. Enterprise support for Chaithainya-MFI’s Women Group’s Chilli and Sambar powder making Enterprise in Nayakanahatti village, Chitradurga District

Project Photos










Sambar powder being prepared












Chilli’s being dried before grinding

Project Dates First time draft – September 9, 2007
Second time draft – March 19, 2008

Project Financials
http://spreadsheets.google.com/pub?key=pwRdPi0mYDcKdVTrrGh2aNw

Project Details

The earlier project of assisting five women to set up the enterprise is being modified. This is because of complexities in the project. The enterprise needs to worry about procuring material, manufacturing it, packing it, marketing it and selling it. Due to all these activities, Chaitanya will initially do all the necessary activities other than the preparation of the powder, whereas the women will focus on the preparation of the powders. Once the other aspects of the project are set, the enterprise will be transferred to the women.

The enterprise will from the beginning make both chilli and sambar powder. The enterprise will not invest a great deal of money in fixed assets in the beginning to minimize the risks. The grinding, which is a large investment will be outsourced to a nearby mill.

The finished product will be packaged in attractive packets so as to help in the sales. Some of the initial investment has gone into making the necessary dies for packing. The initial sales will be to wholesale shops in Nayakanahatti and Challakere towns. If this does not go through, the sales will then be made to schools.

Project Size Details

Investment in the fixed assets will be for a electronic weighing scale, sealing machine and dies for making the covers. This investment will be Rs 8516.

Investment required for working capital will be for raw material sourcing, for grinding and for packing material. The investment required to be made will be as follows. The total investment here will be Rs.80000.

In total, the project cost will be Rs. 88516.

Calculating working capital support
	Raw material for Chilli		27700
	Raw material for Sambar		29770
	for packing material		12000
	for grinding and others		10530
	Total		80000

Project Impact Details
The project will give employment to atleast 2 women(for preparation and for packing). It will also give employment to one person who will do the grinding at the grinding mill. There will be additional employment as people will be engaged in selling the packets.

Estimated Pre-investment Costs

Total Costs – Rs.31350.

S3IDF costs

Personnel costs- Rs. 8350

Other costs- Rs. 3000

Total S3IDF costs- Rs. 11350

Partner costs

Personnel costs- Rs. 15000

Other costs- Rs. 5000

Total Partner costs- Rs. 20000

Returns for S3IDF Revolving Fund

The returns on the working capital support will be 14%

Project Indicators

Investment indicators:

Investment size – Rs. 88,516

Revolving fund – Rs. 88,516

RF to investment size 100%

Cost Indicators (estimated)

Total pre investment cost – 31350

Pre investment cost/Investment Ratio – 35%

Impact indicators

No. of direct beneficiaries – employment to 3

Investment size /no. of beneficiaries – NA

Project Risks

Project Owner/operator risk:

The project owners, the 5 women are currently doing individual businesses such as running petty shops and working as tailors. However, they do not have experience of doing any business such as a chilli making enterprise. So this is a risk. To overcome this, S3IDF and Chaitanya are providing them guidance on how to run the operations. To overcome the financial risk, Chaitanya will initially own the operations and then transfer the operations to the women group.

Market risk:

The risk here is that, the enterprise will not be in a position to sell the product. Survey’s have indicated that there is a sufficient market. Trial runs have been made and the product tested in the market. The product has got good response. Also, the product will be priced lower than competition, which will help to capture the market. To further push the product, marketing will be given focus. Banners will be made and the wholesales will be given incentives for pushing the product. In case, still selling will not be possible, the product will be sold to schools where Chaitanya has a good relationship

Technology risk:

There is no technology risk

Portfolio risk:

There is no portfolio risk

Mission risk:

The owners of the enterprise can be considered to be below the poverty line. Hence there is no mission risk.

Partners

Chaitanya and the women’s group - Annuseamma, Gauramma, Mantamma, Ratnamma and Musturpe