16

Nubuck Leather
PRODUCT CODE

: N.A.

QUALITY AND STANDARDS

: IS 8170 -1977

PRODUCTION CAPACITY

: Quantity: 60,000 Pieces

Value: Rs. 4,44,00,000

MONTH AND YEAR

OF PREPARATION

: January, 2003.

PREPARED BY

: Small Industries Service Institute

34, Industrial Estate, Nunhai,
Agra-282006(U.P)
Ph. No.: 381023
Fax: (0562) 3813287
E-mail: [email protected]

INTRODUCTION
Nubuck leather is generally
manufactured from raw cowhide and
used for manufacturing of footwear
articles, leather garments and leather
goods. Shoes, leather goods and leather
garments are exported to different
countries to fulfil the global market.
Nubuck leather is softer and has
attractive look.

MARKET POTENTIAL
There are a number of shoes,
garments and goods manufacturing
units throughout the country which
demand nubuck leather due to good
export market for products made by
nubuck leather.

B ASIS AND PRESUMPTIONS

1. The Project Profile has been
prepared on the basis of single

2.

3.

4.

5.
6.

shift of 8-hrs. a day and 25working days in a month at 75%

efficiency.
It is presumed that the capacity
utilisation will be 70% followed by
85% in the next year and 100%
in the subsequent year.
The rates quoted in respect of
salaries and wages for skilled
worker and others are on the
basis of minimum rates in the
State Govts.
Interest rate for the fixed and
working capital has been taken @
15% on an average whether
financed by the Bankers or
Financial Institutions.
The margin money required is
minimum 30% of the total capital
investment.
The rental value for the
accommodation of office, workshop
and other covered area has been
taken @ Rs. 20 per sq. mtr.

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NUBUCK LEATHER

IMPLEMENTATION SCHEDULE

7. The rate quoted in respect of

machineries, equipment and raw
materials are those prevailing at
the time of preparation of the
Project Profile and are likely to vary
from place to place and supplier to
supplier. When a tailor made project
profile is prepared, necessary
changes are to be made.
8. The pay -back period may be 5years after the initial gestation
period.
9. The gestation period in
implementation of the project
may be to the tune of 6 to 9
months which includes making all
arrangements, completion of all
formalities, market surveys and
tie-ups etc. Once all the above
arrangements are made and
quality/standards achieved the
100% project capacity may be
achieved at the end of three years.
However, a detailed PERT/CPM/
chart with implementation period
has been given in the report.

The implementation of the project

includes various jobs/exercises such as
procurement of technical know how,
transfer of technology, market surveys
and tie-ups, preparation of project
report, selection of site, registration,
financing of project, procurement of
machinery and raw materials etc.,
recruitment of staff, erection/
commissioning of machines, trial
production and commercial production
etc. In order to efficiently and
successfully implement the project in the
shortest period the slack period should
be curtailed to minimum possible and
as far as possible simultaneous exercises
should be carried out. In view of above
a CPM-PERT Chart has been illustrated
below, according to which a minimum
period of 227 days is involved in finally
starting the project on commercial basis.
By following this process a time period
of 82 days can be saved.

4
1

10

11

Details of Activities
C.P.M.
Activity
1-2

Days
15

Activity
1-2

Days
15

3-4

15

3-4

15

4-5

2-3

Particulars of Activity
Procurement of Tech. know how/
transfer of technology.
Market survey, tie up and obtaining
quotations.
Selection of site.

12

NUBUCK LEATHER

Activity

Days

Activity

Days

5-6
6-7
7-10

70
45
30

4-5
5-6
6-7

7
70
45

10-11
11-12
8-10

30
15
15

6-8
6-9

30
30

7-10

30

10-11
11-12
Total

30
15
227

Preparation of Project report

Registration and financing.
Placement of orders for machineries and
receipt of machines.
Recruitment of staff and training
Addition/Alteration in rental premises
Procurement of raw material/Bought out
components
Erection, Electrification and
Commissioning
Trial Production
Commercial Production

309

TECHNICAL ASPECTS
Process of Manufacture

Raw Material: Wet salted hair slip quality

cow hide of average weight 11-15 Kg.
each.
Soaking: The hides are washed
thoroughly and soaked in a paddle
containing the following chemicals :
Na2S
0.2%
Water
400 500%
(Percentage is taken on the raw weight)
The hides are kept in the paddle over
night. Next morning the paddle is run for
30 minutes and checked for proper soaking
and then washed in running water,
drained out and soaked weight is taken.

Liming: Liming is done in drum. The

following chemicals are taken on soaked
weight:
Water
Nitrogen LS
Na2S

Particulars of Activity

300%
0.2%
5%

Slaked Lime
4% -6%
Salt
2%
The liming takes 18-20 hours, the
drum is run for 2 3 minutes every two
hours, rinsed in soft water for 10
minutes, fleshed and scudded and limed
weight is taken.

Deliming: The fleshed pelt is washed in

running water in drum for 20 minutes
and drained out. The following chemicals
are taken on pelt weight:
Water
250%
Ammonium Sulphate 1.2% to 1.7%
Sodium bi Sulphate 0.4% to 0.6%
The drum is run for 30-40 minutes
and checked by phenolphthalein and
test should show 20 25 red or drained
out and washed thoroughly with 2
changes of water for 20 minutes then
pelts are scudded.

Pickling: The pelts are pickled with the

following chemicals:
Water
70%
Salt
5%

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NUBUCK LEATHER

Drum run for 10 minutes and then

add H2SO4 1.5%.
The acid is diluted with water and
added in three instalments at an interval
of 10 minutes and after last instalment
run the drum for 45 minutes. Checked
the p H of pelt with bromophenol blue
indicator which should be 2.8.

Chrome Tanning: Half of the pickle liquor

(pelt) is drained out and the hide is run
for 15 minutes then add:
Basic Chrome Powder 7%
Sodium Acetate
0.5%
Soda Ash
0.3%
Chemicals are fed in two instalments
at the interval of 15 minutes and drum
run for further 2 hours, p H 3.8 4.0
pile up over night and next day samming
and setting, splitting, shaving, to 1.3
1.4 mm. These shaved leathers are
washed for 10 minutes in warm water
3035C.
Retanning: Basic Chromium
Sulphate (33%)
Sodium formate
Drum run for 10
minutes then add
Cationic fat liquor
Drum run for 1 hour
then add sodium formate

3%
0.5%
2%
2%

Sodium bicarbonate

0.7%
(dissolved
1:10)

and drum run for 45

minutes and p H should
be 4.5 4.8 then add:
wattle extract powder
4%
Tanigun pR (Buyer)
1%
Chestnut extract powder 1%
Drum run for 45 Minutes then drain
only and rinse for 5 minutes.

Dyeing and Fat Liquoring:

Acid dye in powder
3%
Drum run for 25
100%
minutes and then
add water
Drum run for 20
6%
minutes and then add:
Soundozal KB
Drum run for 1 hour
0.5%
and then Add:
Formic Acid
(diluted 1:10)
Drum run for 20
1.1%
minutes and then add:
Taffuilon 218 A
Drum run for 20 minutes and then
horse up. The leathers are sammed, set
out, saw dusted, staked, toggled, buffed
on grain with 400 grit emery paper and
brushed off.

Process Flow Chart

1. Soaking

2. Liming

3. Fleshing

4. Deliming

5. Bating

10. Splitting
& Buffing

9. Piling

8. Basification

7. Chrome
Tanning

6. Pickling

11. Retanning

12. Dyeing & Fat liquoring

NUBUCK LEATHER

Production Capacity
Quality : 60,000 Cow hides
Value : Rs. 4,44,00,000
Quality Control and Standards
Indian standard specification IS
8170:1977 is used in maintaining
standards for cow nubuck leather
Motive Power
Water

130 HP.
: Rs. 1000

Energy Conservation
The following steps may be taken for
the conservation of energy:
1. Machinery and Equipments parts
which are revolving and
reciprocating should be properly
lubricated from time-to-time with
suitable lubricant oil.
2. Lay out of the unit should be in
such a way in that no back
tracking of material is there.
3. All electric switches may be kept
off, when not required.
4. The entire transmission belt will
be tightened before starting the
work, wherever applicable.
5. Fluorescent tube with electronic
Chokes may be used for energy
saving. Further recently developed
compact fluorescent tubes
called(CFT) of 10,15, watts
Philips/Glaux made may be used
for energy saving and decoration.
These self ballasted fluorescent
lamps are high efficiency
replacements for ordinary bulbs.
For same light output, CFLEBs
consume about one fifth the
power consumed by ordinary
bulbs, thereby saving a lot of
energy. The savings get further

multiplied when CFLEBs are used

in air conditioned areas, since the
saving of energy by using CLEBs
also corresponds to less heat
dissipation reducing load on air
conditioners. The life of CFLEBs
is about 8000/10000 hours i.e.
about 10 times that of ordinary bulb.
The typical pay-back period in
terms of savings of energy bills
and cost of ordinary lamps is
about 6 months operation. Unlike
ordinary bulbs, these CFLEBs
provide choice of three colours
designated A, B and C, to suit
individual requirements.
Electronic Ballast, with
protection against high voltage
spikes, along with high quality
CFLs make these composite
CFLEBs (or self ballasted CFLs)
Slim, light weight, efficient and
reliable units.
6. As far as possible Solar Energy
and day light will be used keeping
all the other lights off.
7. As far as possible inductive load
of motor will be reduced and high
power factor will be used with the
aid of capacitors of appropriate sizes.
Pollution Control
The unit requires an effluent
Treatment Plant of its own which involves
the following main operation In general
the operation mainly involved in it as:
1. Screening
2. Sedimentation
3. Setting, Filtration and evaporation
(solar). For this proposal an
effluent treatment plant of Rs.4.05
lakhs is needed. The break up of
which is given below:

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NUBUCK LEATHER
Breakup of Effluent Treatment Plant
Sl. Description
No.

Size

Qty.

Cost
(Rs)

1. Solar Evaporation Tanks

20X10X3.5

2. Sludge Drying bed

20X10X3.5

3. Equalization Cum Setting

15X10X5

4. Preliminary settling Tank

10X10X5

5. Aeration Tank

10X10X5

6. Secondary Settling Tank

4X4X4

7. Drainage

2X2X400

8. Lime addition Tank

4X4X4

9. G.I.Sheet Pans for items (1) and(2)

20X10X3.5

70,000

10. Aeration Paddles

10X 8

80,000

11. Electric Motor

7.5 HP

20,000

12. Motor starter

2,30,000

3,000

13. Main Switches etc.

2,000
Total

4,05,000

FINANCIAL ASPECTS
A. Fixed Capital
(i) Land and Building

(Rs.)

Land 2 acres @ Rs. 1,00,000

2,00,000

Built up Area
1. Office and Stores etc. 120 Sq. meter

1,80,000

2. Working Sheds 1000 Sq. meters @ 1200

12,00,000
Total

15,80,000

(ii) Machinery and Equipments

Sl. Description
No.

HP/kW
(Rs.)

Ind/Imp.

Qty.

Value
(Rs.)

10

Ind.

1,00,000

2. Tanning Drum with motor starter 8x6

10

Ind.

4,00,000

3. Fleshing machine 1800 mm

10

Ind.

2,50,000

Ind.

60,000

(a) Production Unit

Name of machine with specification:
1. Wooden paddle with motor starter etc.
8 x 7

4. Experimental Drum 3X3

5. Double width shaving m/c. 1800 mm width

Ind.

4,50,000

6. Double width splitting m/c. 1800 mm width

Ind.

5,50,000

NUBUCK LEATHER
Sl. Description
No.

HP/kW
(Rs.)

Ind/Imp.

Qty.

7. Dyeing and fat liquoring Drum 8X6

10 HP

Ind.

2,00,000

8. Staking Machine Comb type

Ind.

1,10,000

9. Toggling Chamber, 10 plates

Ind.

90,000

10. Measuring Machine, 1800 mm width

Ind.

2,00,000

11. Generator set 50 kVA

Ind.

2,50,000

12. Working Table, Toggle etc.

Ind.

50,000

13. Weighing Scale

Ind.

50,000

14. Buffing machine

Ind.

1,00,000

Total

Value
(Rs.)

28,60,000

(b) Testing Equipments

15,000

(c) Pollution Control Equipment, if required (Effluent Treatment Plant)

4,05,000

(d) Energy Conservation Facilities/ Equipment, if used:

Furnace should have heat resistant fire bricks to avoid wastage
of heat energy CFT Tubes
Fluorescent Tubes with electronic chokes

10,000

(e) Electrification and Installation Charges @ 10%

2,86,000

(f) Cost of Tube well, Pump set, overhead tank and water connection etc.

70,000

(g) Cost of office equipment/ Working table etc.

50,000

(h) Cost of transformer and electrification

(If load is more than 15 kW)

1,50,000

Total Cost of Machinery and Equipments

(a + b + c + d + e + f + g + h)
(iii)

38,46,000

Pre-operative Expenses

30,000

Total Fixed Capital (i+ii+iii)

(15,80,000 + 38,46,000 + 30,000)

54,56,000

B. Working Capital (per month)

Staff and Labour (per month)
(i) Personnel
Sl. Designation
No.

Sl. Designation
No.

No. Salary

vii) Watchman
No. Salary

Total
Value
(Rs.)

(a) Administrative and Supervisory

Total
Value
(Rs.)

2000

2,000

(b) Technical Skilled and Unskilled

Skilled Workers

4000

28,000

Semi -Skilled Workers

3000

24000

Machine Operators

4000

20,000

i)

Manager

10000

10,000

ii)

Production manager

7000

7,000

Electrician- cum- Mechanic

3000

3,000

iii) Supervisor/ Foreman

5000

5,000

Un-skilled workers

2000

12,000

iv) Clerk cum Typist

4000

4,000

v)

3,000

3,000

2000

2,000

Store Keeper

vi) Peon

Total (a+b)

Perquisites @ 20 %

1,20,000
24,000

Total

1,44,000

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NUBUCK LEATHER
(ii) Raw Material (per month)
Sl. Description with Qty.
No. specification
1. Wet salted cow
hides

(v) Total Recurring Expenses (per month) (Rs.)

Rate

Value
(Rs.)

5000
450 22,50,000
pcs. per pcs.

2. Chemicals

L.S.

3. Packing Material,
Polythene, Paper,
Gunney bag etc.

L.S.

138
per hides

6,90,000
5,000

Total

29,45,000

(iii) Utilities (per month)

(Rs.)

Electricity power 4000 kWH units

@ 1.5 per unit

7,000

Fuel (Diesel) 500 litres @ Rs. 12 per litre

6,000

Water

2,000
Total

(iv) Other Contingent Expenses

(per month)

15,000
(Rs.)

1) Salary and Wages

1,44,000

2) Raw Material

29,45,000

3) Utilities

15,000

4) Other Contingent Expenses

20,000

Total

31,24,000

(vi) Working Capital (for 3 months)

31,24,000 x 3 =
93,72,000

C. Total Capital Investment

Fixed capital

Rs. 54,56,000

Working capital for 3 months

Rs. 93,72,500

Total

Rs. 1,48,28,000

MACHINERY UTILIZATION
Anticipated utilisation of machinery
is about 75 to 80%.

FINANCIAL ANALYSIS

1. Postage and Stationery

1,000

(1) Cost of Production (per annum)

2. Advertisement and publicity

1,000

(a) Total Recurring Cost

3. Repair and Maintenance

3,000

4. Telephone

2,000

5. Transportation

2,000

6. Consumable

3,000

7. Sales expenses

2,000

8. Insurance

1,000

9. Legal Expenses and taxes

1,000

10. Misc. Expenses

4,000
Total

(Rs.)
3,74,88,00

(b) Depreciation on Machinery

and Equipment @ 10%
(c) Depreciation on Office
Equipments @ 20%

2,86,000
10,000

(d) Interest on Total Capital

Investment @ 15%

22,24,200

(e) Depreciation on Building

@ 5%, if any

79,000

20,000

Total

4,00,87,200

Say

4,00,87,000

(2) Turnover (per annum)

Sl. Description
No.

Qty.

Rate
(Rs.)

Value
(Rs.)

4,40,000
sq. ft.

60 per sq. ft.

2,64,00,000

Nubuck Leather high grade

20,000 pcs. (22 sq. ft. area)

Nubuck Leather medium grade

20,000 pcs. (18 sq. ft. area)

36,0000
sq. ft.

30 per sq. ft.

1,08,00,000

Nubuck Leather low grade

20,000 pcs. (18 sq. ft. area)

36,0000
sq. ft.

20 per sq. ft.

72,00,000

Total

4,44,00,000

NUBUCK LEATHER
(3) Net Profit (per annum) (before Income Tax)
= Turn Over Cost of production
= 44400000 1482800

1. M/s. Bengal Machinery Co.

9 A, New Tangra Road,
Kolkata.

= Rs. 43,12,800
(4) Net Profit Ratio
= Net profit x 100
Turn over

2. M/s. Annapurana Engg. Works

F-10/2, MIDC,
Shiroli,
Kolhapur.

= 4312800x100
44400000
= 9.7%
(5) Rate of Return

3. M/s. Shalimar Engg. Works

12-B, Prabhorah Sarkar Lane,
Kolkata-15.

= Net profit x 100

Total investment
= 4312800x100
14828000
= 29%
(6) Break-even Point
Fixed Cost (per annum)

(Rs.)

(i) Total Depreciation (on m/c.

and equipment, dyies,
tools, furniture)
(ii) Interest on borrowing
(Total Investment)

2,96,000

22,24,200

(iii) Insurance

12,000

(iv) 40% of salary

6,91,200

(v) 40% of other contingent expenses

(excluding rent and insurance)

1,63,200

(vi) Depreciation on building

79,000
Total

B.E.P.
= Fixed Cost x 100
Fixed cost + profit
= 44.55 %

Addresses of Machinery and Raw

Material Suppliers

34,65,600

4. M/s. Prototype Development

and Training Centre,
B/24, Guindy Estate,
Ekkaduthangal,
Chennai-9.
5. M/s. Sandoz (P) Ltd.
Sandoz House,
Dr. A.B. Road, Worli,
Mumbai-8
6. M/s. Bayer (India) Ltd.
749, Anna Salai,
Chennai-2
7. M/s. Tamilnadu Chromates and
Chemical Ltd.
13, Nungambakkam High Road,
Chennai-34
8. Local Market.

103