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Term paper on:

Cost and Return Analysis of Bakery Food Items in Comilla, Bangladesh Contents)

Md. Tarek RahmanManagement 4th BatchID: 0908048Comilla University, BangladeshCell: 01947690360

Introduction:

Bakery industry has a great importance in our country. It is important for both fooding purposes and the business purposes also. This Assigned Term paper is made on Bakery and Confessionary factories in the Comilla Contents and is targeted to find out their production cost on a specific item. This is to learn Costing and to get practical knowledge. However Paper given emphasize on Dry cake Production. While field work I have visited different Bakery factories and got some information from that factories. I enjoyed this work as the people of the organizations were helped me heart fully. I came to know that these are the prime bakery and confessionary food producing organizations in Comilla.

Objectives of the Study:The main objective of the study is to analyze the Cost and Return of a Specific Bakery and Confessionary Food Item. Moreover this study has the following objectives: To know about Costing Method Used in This Area. To know the nature & activities of Bakery and Confessionary food producing organizations. To find the problems Bakery and Confessionary sector. To Know the Impact of Bakery and Confessionary To know the current situation of Bakery and Confessionary To know about the market of Bakery and Confessionary

Methodology of the Study Limitations of the All informations Used in this paper are collected on primary based and from direct observations. For analyzing the data I have used the MS excel and MS word function of computer. I prepared a questionnaire and according to that Questionnaire I formed the overall formation of the paper. In our field work I am very much hurtful to MUSLIM BAKERY AND SWEETS, HAQUE FOODS and BREAD and ITTAD FOODS and Beverages. Limitations of the study

The study was conducted through some obstacles and constraints.

1. Data constraint: lack of adequate data due to proper utilization of skill and knowledge.

1. Literature constraint: No major work has so far been done in Bangladesh in this sector. Therefore, there is a dearth of literature in this field.

1. Time and budgetary constraint:Shortage of time and budget was also a great limitation of this study.When we were going to start the term paper then we didnt have enough time. It is also tough to prepare a long term paper within a short period of time.

Bakery Industry

We want cake Biscuit and Bread in the table of breakfast or sidelines of our heavy hunger in working in the office or to entertain our guests or in time of Birthday celebration. According to our need and demand different Large and small bakery industry of the country is supplying these items.The Bakery industry is an important segment within the Bangladesh food and beverage industry. The major product markets within this industry include bread, morning goods, cakes & pastries and biscuits. Manufacturer penetration is high within the bakery industry is the reason for the ongoing consolidation. Furthermore, the considerable strength of retailers in the market has pressurized and greatly reduced the profit margins of bakery manufacturers. Though the nature of the industry offers limited scope for growth, changing consumer trends have recently been very important in the bakery industry, which has resulted in a number of potential growth opportunities for manufacturers. Increasing consumer demands for healthy, convenient and tasty food has stimulated the bakery manufacturers to differentiate and innovate baked products, in order to capitalize on these trends.

Bakery and Confectionary in Comilla

In Comilla Prospects there are almost 20 Large and small Bakery industry and they are supplying there BAKERY items in comilla and its adjacent districts and their Sub districts. Great advantages here is that investment in this sector need not to be high and with this low investment a lot of people are getting employment here While visiting this BAKERY industry in comilla we found about 20 Bakery and average employment opportunity is about 30 per Industry. So it shows that it providing employment to 600 people in Comilla. Most of the Bakery Factory has their own show room and the deliver their products from both factory store and from the show room. Most of the Bakeries produces Bread and Biscuit and supply these items to the street Tong Shops and the small stalls. But there are some reputed Bakery factory also they sold their items to their own showroom only. Every day they supply their products to different locations of the city by their own Rickshaw Van and supply their products to adjacent districts by their own mini Track. Recently we found that some bakery factory brought newness to their production process and to the technology that they were using in the past times. Besides improving the quality of the product Bakery Factories in Comilla is trying to improving their packaging procedure and skill of the workers that are working for their production. For this Purposes the reputed Bakery Factories are importing new and newer technologies from Europe and America besides keeping their own tradition and own specific test and qualities of the food items. While visiting in the city we found that there are some franchised Bakery houses of the international names. So it is good luck for Camilla citizens that they are taking test of the international food items side by side their local traditional food items. Bakery Factories recently added Fast Food items Sweet items and different from of pastry food items. Some Bakery has achieved reputation with their own food items like IMANIA is reputed for producing happy day cake. Relish is reputed for producing Chanachur and Minarva is reputed for producing Jeelapi etc. Of the entire bakery we found that Muslim Bakery is producing in the mass production and supplying their bakery items not only in comilla but also the adjacent districts of Comilla. These bakery Factories are here for several years some are new and some are older more than 20 years and Year after year they are producing Bakery items and supplying this to the citizens of Comilla. We found while visiting this Bakeries that Biscuit , Ddry Cake, Toast Milk Toast, Salted biscuits Danish Biscuit, Batter Bon, Dry sweet, Koockies and some other form of Biscuit and the channachur, Vegetable crackers, Peddis, Singara, and some other form of food items like Vegetable and chicken Porota, role, Relish and so on.

Bakery Items Producing in Comilla

SL NOItems Sub Items

1. Biscuiti. Slated Biscuitii. Toast Biscuitiii. Ghee Biscuitiv. Sugar and Ghee Toastv. Chocolate Biscuitvi. Sweet Biscuit

2. Chaanachuri. Chikon Chanachurii. Mota Chanachuriii. Badam Chanachur

3. Cakei. Normal Cakeii. Chocolate Cakeiii. Dry Cakeiv. Chocolate Dry Cake

4. Loafi. Sweet Loafii. Butter Boniii. Jelly Boaniv. Plain Loaf

5. Sweeti. Kalo Jamii. Rosogollaiii. Ladduiv. Dry Sweet

6. Poratai. Begitable Porataii. Chicken Porata

7. Pizzai. Vegitable Pizzaii. Chicken Pizza

iii. Rolei. Vegitable Roleii. Chicken Role

iv. Other Itemsi. Singaraiii. Jeelapiiv. Peddisv. Nemki etc.

Discussed Topics

Analyzing the Cost and Profit ofSalted Biscuit

Study Conducted on

Muslim Bakery and SweetsComilla BISCIC Block B-10

In the Bakery Sectro in Comilla MUSLIM Bakery is and remarkable name. Since 2007 it is working in this sector. Muslim Bakery and Sweets situated in Camilla Biscic Industrial Area. It is serving bakery products ads sweet meets to comilla city corporation and adjacent areas. It has a production factory on 6 Gonda Land in BSCIC Comilla. Mizanur Rahman is the owner and the director of the Bakery and started its production in BSCIC scince 2007 in Comilla. It is committed to serve quality product to the Comilla citizens Muslim Bakery is trying to produce quality product and serving it to the citizens of Comilla city corporation and its adjacent areas. Beside producing its own traditional products it brought some new machineries and mixing machines to produce its products and to give the people the test of both local bakery items and the test from the abroad. Generally Muslim Bakery produces bakery items but besides producing the bakery items presently it is producing sweet items and some other fast food items also.

Presently It is Producing the Following Bakery and Sweet Items:


i. Biscuitvii. Slated Biscuitviii. Toast Biscuitix. Ghee Biscuitx. Sugar and Ghee Toastxi. Chocolate Biscuitxii. Sweet Biscuit

ii. Chaanachuriv. Chikon Chanachurv. Mota Chanachurvi. Badam Chanachur

iii. Cakev. Normal Cakevi. Chocolate Cakevii. Dry Cakeviii. Chocolate Dry Cake

iv. Loafv. Sweet Loafvi. Butter Bonvii. Jelly Boanviii. Plain Loaf

v. Sweetv. Kalo Jamvi. Rosogollavii. Laddu

Management and Employment Structure In Muslim Sweet:SL NOPostSu Posts

1. Managementi. Directorii. Production Manageriii. HR Manageriv. Sales Manager

2. Productioni. Chief Chemistii. Assistance Chemistiii. Workers

3. Salesi. Sales Managerii. Marketing Manageriii. Driver

Cost and Profit Analysis for Salted Biscuit:

ParticularsNoteTKTK

Raw Materials Consumed Note-0176.614

Productive WagesNote-020.6384

Prime Cost77.2524

Factory Overheads

Factory Rent: Note-030.5385

Depriciation on MachinariesNote-040.008

Gas and Water BillNote:90.046

Repair of Plant and Machinery:

Note-110.0769.6694

Work Cost77.9218

Office and Adminstrative Cost:

Salary office Personnel:

Note:05

0.554

General and Other ExpensesNote: 080.154.708

Cost of Production78.6298

Selling Overhead

Selling ExpensesNote: 060.269

Packing Expenses:Note: 070.046

Transportation Cost: Note-100.1540.469

Cost of Sales79.0988

Profit 20.9012

Sales100.00

Notes For Cost Analysis.Note: 01Muslim Bakery and Sweets

Ingredients Necessary for 7 kg Salted BiscuitCounted in KGPer kg CostCost for Used Material

Floor 4.542189

Sugar0.65633.6

Salt0.06201.2

Cream16060

Oil0.513065

Egg77.552.5

Ghee0.150050

Vegetable oil17575

Kalagira0.0520010

14.81536.3

Other Costs

Cost of Raw Material Consumed for one kg Salted Biscuit= 536/7=76.614 tk

Note: 02Productive Wages:Total Salary Incurred for 16 worker including the Chemist is 70000 thousand TkItems Produced in a month 20 Salted Biscuit Produced in a month 150 kg Salary Paid for one kg Salted Biscuit =

Note: 03Factory Rent: Total Factory Rent Paid is 70000Items Produced in a month is 20 Salted Biscuit Produced in a month is 6500 kgCost incurred for one kg Salted biscuit is=tk

Note: 4Depreciation On Machinery Incurred:Total Amount Depreciated on Machineries in a year : 12000Depreciation in a month: 12000/12= 1000Items Produced in a month 20Slated biscuit Production in a month is 6500 kgAmount of Depreciation for One Kg Salted Biscuit Production=

Note:05Salary office Personnel:Total Salary Paid to the office Staff and Managers: 72000Items Produced in a month 20 Salted Biscuit Produced in a month 6500 kg Salary Paid for One kg Salted Biscuit =

Note: 06Selling Expenses: Selling Expenses Estimated: 35000 tk / MonthItems Produced 20Salted Biscuit Produced in a month 6500 kgSelling Expenses for one kg Salted Biscuit Production:

Note:07Packing Expenses:Total Packing expenses for a Month: 6000Items Produced 20Salted Biscuit Produced in a month 6500 kgPacking Expenses for one kg Salted Biscuit Production:

Note: 08General and Other Expenses: Total General and Other expenses= 20000 tkItems Produced 20 Salted Biscuit Produced in a month: 6500 KGGeneral Expenses for One KG Salted Biscuit::

Note:9Gas and Water Bill:Total Gas and Water Bill in a month 6000 TKItems Produced 20 Salted Biscuit Produced in a month: 6500 KGGeneral Expenses for One KG Salted Biscuit::

Note:10Transportation Cost: Salary of the Drivers for a month 17000Depriciation Cost 3000Total Transportation Cost: (17000+3000)=20000Items Produced in a month: 20Total Salted Biscuit Produced in a month 6500 kgTransportation cost for one kg Salted Biscuit:

Note:11Repair of Plant and Machinery:Total cost in maintaining and repairing Plant and machinery = 1000Items Produce in a month 20Total Salted Biscuit produced: 6500 kgCost incurred for one KG Salted Biscuit production:

Haque Bakery and BreadComilla BISCIC Block D-14

Haque Bakery situated in Camilla Bscic Industrial Area. It is serving bakery products ads sweet meets to comilla city corporation and adjacent areas. It has a production factory on 6 Gonda Land in BSCIC Comilla. Mizanur Rahman is the owner and the director of the Bakery and started its production in BSCIC scince 2000 in Comilla. Haque is trying to produce quality product and serving it to the citizens of Comilla city corporation and its adjacent areas. Beside producing its own traditional products it brought some new machineries and mixing machines to produce its products and to give the people the test of both local bakery items and the test from the abroad. Genreally Haque Bakery produces bakery items but beside producing the bakery items presently it is producing sweet items and some other fast food items also. Presently It is Producing the Following Bakery and Sweet Items:


1. Biscuitxiii. Slated Biscuitxiv. Toast Biscuitxv. Sugar and Ghee Toast

2. Chaanachurvii. Chikon Chanachurviii. Mota Chanachurix. Badam Chanachur

3. Cakeix. Normal Cakex. Chocolate Cakexi. Dry Cake

4. Loafix. Sweet Loafx. Butter Bonxi. Jelly Boan

Cost and Profit Analysis for Salted Biscuit:

ParticularsNoteTKTK



Prime Cost77.24228

Factory Overheads



Gas and Water BillNote:90.10714


Note-110.02381.09914

Work Cost78.34128



Note:05

0.0158



Selling Overhead





Profit 20.3344

Sales100

Note:01Haque Bakery and Breads


Floor 4.542189

Sugar0.55628

Salt0.06201.2

Cream16060

Oil0.513065

Egg77.552.5

Ghee0.150050

Vegetable oil17575

Kalagira0.0520010

14.81530.7

Other Costs

Cost of Raw Material Consumed for on kg Salted Biscuit= 530.7/7=75.8143 tk

Note: 02Productive Wages:Total Salary Incurred for 14 worker including the Chemist is 60000 thousand TkItems Produced in a month 12 DRY CKAE Produced in a month 3500 kg Salary Paid for one kg DRY CKAE =

Note: 03Factory Rent: Total Factory Rent Paid is 40000Items Produced in a month is 12 DRY CKAE Produced in a month is 3500 kgCost incurred for one kg DRY CKAE is=tk

Note: 4Depreciation On Machinery Incurred:Total Amount Depreciated on Machineries in a year : 8000Depreciation in a month: 8000/12= 666.667Items Produced in a month 12DRY CKAE Production in a month is 3500 kgAmount of Depreciation for One Kg DRY CKAE Production=

Note:05Salary office Personnel:Total Salary Paid to the office Staff and Managers: 60000Items Produced in a month 12DRY CKAE Produced in a month 3500 kg Salary Paid for One kg DRY CKAE =

Note: 06Selling Expenses: Selling Expenses Estimated: 25000 tk / MonthItems Produced 12DRY CKAE Produced in a month 3500 kSelling Expenses for one kg DRY CKAE Production:

TK

Note:07Packing Expenses:Total Packing expenses for a Month: 4000Items Produced 12DRY CKAE Produced in a month 3500 kgPacking Expenses for one kg DRY CKAE Production:

Note: 08General and Other Expenses: Total General and Other expenses= 12000 tkItems Produced 12DRY CKAE Produced in a month: 3500 KGGeneral Expenses for One KG DRY CKAE::

Note:9Gas and Water Bill:Total Gas and Water Bill in a month 4500 TKItems Produced 12DRY CKAE Produced in a month: 3500KGGeneral Expenses for One KG DRY CKAE::

Note:10Transportation Cost: Salary of the Drivers for a month 12000Depreciation Cost 2000Total Transportation Cost: (12000+2000)=14000Items Produced in a month: 12Total DRY CKAE Produced in a month 3500 kgTransportation cost for one kg DRY CKAE:

Note:11Repair of Plant and Machinery:Total cost in maintaining and repairing Plant and machinery = 1000Items Produce in a month 12Total DRY CKAE produced: 3500 kgCost incurred for one KG DRY CKAE production:

ITTADI FOODS AND BREVARAGE Comilla BISCIC Block D-14

ITTADI FOODS AND BREVARAGE is trying to produce quality product and serving it to the citizens of Comilla city corporation and Through out the country . Beside producing its own traditional products it brought some new machineries and mixing machines to produce its products and to give the people the test of both local bakery items and the test from the abroad. Generally ITTADI FOODS AND BREVARAGE produces bakery items but beside producing the bakery items presently it is producing sweet items and some other fast food items also. Presently It is Producing the Following Bakery and Sweet Items:


vi. Biscuitxvi. Slated Biscuitxvii. Toast Biscuitxviii. Sugar and Ghee Toastxix. Vegetable Crackers

xx. Pine Apple

vii. Chaanachurx. Chikon Chanachurxi. Badam Chanachur

viii. Cakexii. Normal Cakexiii. Chocolate Cakexiv. Dry Cake

Cost and Profit Analysis for Dry Cake:

ParticularsNoteTKTK



Prime Cost73.8714

Factory Overheads



Electricity Gas and Water BillNote:91.25


Note-110.052.954

Work Cost76.8254



Note:05

2.85



Selling Overhead





Profit 13.29957

Sales100

Note: 01ITTADI FOODS AND BREVARAGE


Floor 4.42168

Sugar0.65633.6

Salt0.08201.6

Cream16060

Oil0.513065

Egg77.552.5

Ghee0.150050

Vegetable oil17575

Kalagira0.0520010

Tata Powder.0004700.028

Other Costs

Total Cost515.728

Cost of Raw Material Consumed for on kg Salted Biscuit= 515.728/7=73.674 tk

Note: 02Productive Wages:Total Salary Incurred for 8worker including the Chemist is 40000 thousand TkItems Produced in a month 10DRY CKAE Produced in a month 2000 kg Salary Paid for one kg DRY CKAE =

Note: 03Factory Rent: Total Factory Rent Paid is 25000Items Produced in a month is 210DRY CKAE Produced in a month is 2000 kgCost incurred for one kg DRY CKAE is=tk

Note: 4Depreciation On Machinery Incurred:Total Amount Depreciated on Machineries in a year : 37000Depreciation in a month: 37000/12= 3083.3333Items Produced in a month 10DRY CKAE Production in a month is 2000kgAmount of Depreciation for One Kg DRY CKAE Production=

Note:05Salary office Personnel:Total Salary Paid to the office Staff and Managers: 57000Items Produced in a month 10 DRY CKAE Produced in a month 2000 kg Salary Paid for One kg DRY CKAE =

Note: 06Selling Expenses: Selling Expenses Estimated: 88000 tk / MonthItems Produced 10DRY CKAE Produced in a month 2000 kgSelling Expenses for one kg DRY CKAE Production:

Note:07Packing Expenses:Total Packing expenses for a Month: 20000Items Produced 10DRY CKAE Produced in a month 2000 kgPacking Expenses for one kg DRY CKAE Production:

Note: 08General and Other Expenses: Total General and Other expenses= 15000 tkItems Produced 10 DRY CKAE Produced in a month: 2000 KGGeneral Expenses for One KG DRY CKAE::

Note:9Electricity Gas and Water Bill:Total Gas and Water Bill in a month 250000 TKItems Produced 10 DRY CKAE Produced in a month: 2000 KGGeneral Expenses for One KG DRY CKAE::

Note:10Transportation Cost: Salary of the Drivers for a month 14000Depriciation 0f VAN 2500Total Transportation Cost: (14000+2500)=16500Items Produced in a month: 10Total DRY CKAE Produced in a month 2000 kgTransportation cost for one kg DRY CKAE:

Note:11Repair of Plant and Machinery:Total cost in maintaining and repairing Plant and machinery = 1000Items Produce in a month 20Total DRY CKAE produced: 6500 kgCost incurred for one KG DRY CKAE production:

Comparison of Cost and Profit of the Bakeries

Muslim Bakery:Cost of Sales79.0988

Profit 20.9012

Sales100.00

Haque Bakery and Breads:


Profit 20.3344

Sales100

ITTAD FOODS and BEVARAGES


Profit 13.29957

Sales100

Average of the Three bakeries Cost of Sales Profit and Slaes Price of Salted BiscuitCost of Sales245.46442/3=81.82147

Profit 54.53517/3= 18.17839

Sales300.00/3= 100.00

So form the upper comparison we found that cost of sales of Dry cake is high for ITTADI FOODS and BEVARAGES and profit is low incurred by them.

Picture Profile o n Dry Cake Production

Taking the Ingredients for mixing by the worker in Haque Bakerys and Bread Mixing the Ingredient in the Mixing Machine in Muslim Bakery

Taking the Raw Biscuit to the Oven in Muslim BakeryPreparing the Salted biscuit Baking in the Oven in Haque Bakery and Breads

I Md. Tarek Rahman infront of the Mixing MachineFinished Salted Biscuit of Ittadi Foods and Beverages

Finished Salted Biscuit I ITTADi FOOD and Beverages Vans that are used for the delivery Purposes of Haque Bakery and Foods

Problems with Bakery Industry in Comilla

While visiting different Problems of Bakery Industry In Comilla We found the following problems with the bakeries:

1. Poor Production Process: It is the main problem of the Bakery factories in Comilla and the Buildings that are using for the Production purposes are out of date and some are rejected by the city corporation. It is Common in most of the Bakeries. 2. Low Salary: Salary of the Production workers is low in those Bakeries. And important thing is that most of the times they doesent follow the rules of wages. 3. Unhygienic environment: While visiting the bakeries we found in the Factories in Comilla Bakery industry without three or four bakery factory in comilla. Situation in some bakeries is really indescribable that we have seen. 4. Absence of Updated Technology: Technologically factories are not up to date and most of the items are handmade.5. Unwillingness to Update: We found that the owners want to keep the factories more traditional in test and preferences.6. Business Barriers: Much More Business Barriers with the rules and regulations.7. Lack Knowledgeable Expertise: Lack Expert Chemist working in the industry.8. Preservation Problem: The bakeries do not have any technological preservation as a result the bakeries cannot preserve their foods in a healthier process. 9. Thinking of much Profit: It is another problem of the bakery industry in Comila. By analyzing the cost and profit we found that they are incurring much profit than it is expected to be.

Prospects with Bakery Industry in Comilla

I found some problems tha the bakeries have but thes have some prospects also. However the prospects of Bakery Industry in Comilla are discussed bellow:

1. Necessary Showroom of the Bakeries: The Bakeries has necessary show room for selling their products in comilla. 2. Available Customer: These Bakaries has a lot of customer to sell their products.

3. Keeping their Own Tradition: I found that the bakeries are more tradition in test preferences. And this test refers that it is their goodwill with a specific tes and preferences.4. Combination of Technology and Tradition: It is rare for most of the Bakeries but some Bakeries are practicing this. They are mixing the traditional Items with the upgraded technology by this way they are trying to give us new and better test of the Bakery foods. 5. Chief Labor available: It is a plus point for the Bakeries in Comill is that they are getting chief labor in this area. So the production cost remains liberal. 6. Flexibility in Government Rules and Regulations: Most of the Bakeries are situated in Comilla BSCIC Industrial Area. Are They are enjoying flexibility in some government rules and regulations. 7. Benefits of Small and Medium Interprises: Goverinment have special schim for the batterment of the Small and Medium Enterprises. And this bakeries are eenjojoying this facilities.8. Demand in the Local Market: This Food items have a good demand in the Local market. And people of Comilla are really fond of this food items. 9. Availability of the raw materials: Raw Materials necessary for the production of Bakery items is available in Comilla. 10. Good Transportation System: These Bakaries has a good transportation system. Specially after declaring Comilla As City Corporation the roads are constructed properly so it is really a plus point

Recommendations for The Bakery Industry

Bakeries plays an important role in Comilla so, Bakery Industry is very important and in comilla the Bakeries has some limitations also that is stated before. According to those limitations a want to recommend the following: 1. Bakeries need to upgrade their Production Procedure: It is important for the matching with the present ongoing technology.2. Management should be smarter in their operation: Bakaries need more efficient management team to run the bakeries properly. 3. Technological up gradation is also very important: To give the customer more quality product the Bakeries need more upgraded technology. 4. Quality improvement is must for the Bakeries: Bakeries Need to improve their quality of production. 5. Pricing should be made after a proper cost study: In some cases the price is too high. Beside improving the quality they have to keep the price level liberal. 6. Factory environment should be developed: While visiting the Bakeries we found those very unhygienic so these need to develop. 7. Workers should be more knowledgeable: More knowledgeable workers should be employed in this sectors.

Conclusion

In fulfilling the daily food need of the comilla citizens Bakeries plays an important role. Bakery and Confessionary is very important in our daily life and Bakeries fulfill important portion of daily food demand. After a hard work on bakery on confessionary sector finally I completed this paper. Here I have tried my level best to make this paper more informative. Comparison is drowning on three organizations to compare their costs and the profit that they are making on dry cake items. I think that comparison will help to measure how the organizations are making profit from producing Salted Biscuit in Comilla

Reference

1. Nazmul HossainManager Muslim Bakery and SweetsCell: 016745951452. Hanif AhmedHead Chemist Muslim Bakery nad Sweets3. Ittadi Foods and BeveragesBSCIC INDUSTRIAL COMILLABlock :D-07 4. Haque Foods and BreadBSCIC INDUSTRIAL COMILLA Block :D-14Cell: 01824947266

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