Higher technological institute
10th of Ramadan branch
Mechanical Engineering Department
12/23/2021
Project: Plastic ruler
factory.
Projects Planning & managing.
Submitted by:
Mahmoud Tayel Aziz. ID:20091339.
Abdelrahman Magdy. ID:20150495.
Ali Ezzat Abdelrahman. ID:20162063.
Mohamed Ibrahim saeed. ID:20140685.
Abdelrahman Mohamed Ibrahim. ID:20100124.
Subject Code: MNG 112.
Subject Name: Projects planning.
Group: 1.
Submitted to: Eng. Mostafa Abdelgalil.
Abstract
Project planning is at the heart of the project life cycle and tells everyone
involved where you’re going and how you’re going to get there.
The planning phase is when the project plans are documented, the project
deliverables and requirements are defined, and the project schedule is
created.
It involves creating a set of plans to help guide our team through the
implementation and closure phases of the project.
The plans created during this phase will help you manage time, cost,
quality, changes, risk, and related issues.
They will also help us control staff and external suppliers to ensure that we
deliver the project on time, within budget, and within schedule.
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Acknowledgments
It has been a great opportunity to gain lots of experience in real time for
projects planning followed by the knowledge of how to design, plan and
analyze real projects.
For that we want to thank all the people who made it possible for students
like us.
Special thanks to Eng. Mostafa Abdelgalil for the efforts he did to provide
us with all the useful information and making the path clear for us the
students to implement all the knowledge we gained from him.
At last, we would like to thank all the people who helped, supported, and
encouraged us to successfully finish the report for our “Plastic ruler factory
planning report”.
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Table of Contents
Introduction ............................................................................................................................... 1
The purpose of the project planning phase is to: ................................................................. 1
1) Chapter one: Planning. ...................................................................................................... 2
1.1) Materials required to produce plastic rulers: ........................................................... 2
1.2) Machines needed for the factory: ............................................................................. 2
2) Chapter Two: Market study and Production. .................................................................... 3
2.1) Market Demand. ....................................................................................................... 3
2.2) Yearly production of the factory: .............................................................................. 3
2.3) Sales value ................................................................................................................. 3
3) Chapter three: layout. ....................................................................................................... 4
3.1) Line Layout: ............................................................................................................... 4
3.2) Advantage of line layout: .......................................................................................... 4
3.3) Disadvantage of line layout: ...................................................................................... 4
3.4) Product storage: ........................................................................................................ 6
3.5) utilities are in the same building. .............................................................................. 6
3.6) Administrative area separation ................................................................................. 6
3.7) Production line is in one building one floor: ............................................................. 6
3.7.1) One building ...................................................................................................... 6
3.7.2) One floor:........................................................................................................... 6
4) Chapter Four: Cost analysis and profitability. ................................................................... 7
4.1) Total investment cost: ............................................................................................... 7
4.1.1) fixed investment. ............................................................................................... 7
4.1.2) preproduction capital cost: ............................................................................... 7
4.1.3) net working capital: ........................................................................................... 7
4.2) Total production cost: ............................................................................................... 7
4.3) Net profit: .................................................................................................................. 7
4.4) Return on investment (ROI): ..................................................................................... 8
4.5) Break-even point (BEP):............................................................................................. 8
5) Chapter five: Time plan. .................................................................................................... 9
Conclusion ............................................................................................................................... 10
References ............................................................................................................................... 11
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Table of figures
Figure 1 Factory layout. ..............................................................................4
Figure 2 factory layout (top view) ..............................................................5
Figure 3 factory layout (3rd view) ..............................................................5
Figure 4 factory layout (full view)..............................................................5
Figure 5 BEP Analysis. ...............................................................................8
Figure 6 Time Plan. ....................................................................................9
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Nomenclature
Acronym Definition
BEP Break-Even Point
ROI Return On Investment
OEE Overall Equipment Effectiveness
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Introduction
The project planning phase is often the most challenging phase for a project
manager, as you need to make an educated guess about the staff, resources,
and equipment needed to complete your project. You may also need to plan
your communications and procurement activities, as well as contract any
third-party suppliers.
The purpose of the project planning phase is to:
❖ Establish business requirements.
❖ Establish cost, schedule, list of deliverables, and delivery dates.
❖ Establish resources plans.
❖ Obtain management approval and proceed to the next phase.
The planning phase refines the project’s objectives, which were gathered
during the initiation phase. It includes planning the steps necessary to meet
those objectives by further identifying the specific activities and resources
required to com-plete the project.
Now that these objectives have been recognized, they must be clearly
articulated, detailing an in-depth scrutiny of each recognized objective.
With such scrutiny, our understanding of the objective may change.
Often the very act of trying to describe something precisely gives us a
better understanding of what we are looking at.
This articulation serves as the basis for the development of requirements.
What this means is that after an objective has been clearly articulated, we
can describe it in concrete (measurable) terms and identify what we must
do to achieve it.
Obviously, if we do a poor job of articulating the objective, our
requirements will be misdirected, and the resulting project will not
represent the true need.
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1) Chapter one: Planning.
❖ Whole factory consists of one building, single floor.
❖ Storage facility is on the same floor.
❖ Production layout is a line layout.
❖ Utility room is in the same building.
❖ Administrative area is located behind the production area.
1.1) Materials required to produce plastic rulers:
1. Plastic.
2. Color Masterbatch .
3. Ink.
1.2) Machines needed for the factory:
1. Plastic injection molding machine.
2. Plastic cutter.
3. Industrial inkjet printer.
4. Packaging machine.
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2) Chapter Two: Market study and Production.
2.1) Market Demand.
❖ Demand is going to be seasonal at the start of the school year.
❖ Right now, we are planning to fulfill 1.2 million rulers/year, which
is 1/8 (12.5%) of the total ruler market demand.
❖ After 5 years we may be able to reach 2,000,000 rulers/ year.
❖ The production line Capacity is 580 rulers/hour.
❖ Better specification rulers, more accurate and better printing.
❖ We are going to sell for a price cheaper than the competition.
2.2) Yearly production of the factory:
∵ The production line can produce 580 rulers/hour.
∵ We estimated Overall Equipment Effectiveness factor (OEE) of 0.75,
due to (maintenance, overhaul, quality loss, performance loss……).
∴ Actual production/hour = theoretical production * OEE factor
= 580x0.75 = 435 ruler/ hour.
∵ We are going to work two Shifts, 7 hours /shift and 200 days/year.
∴ Actual production /year = 435*2*7*200
= 1,218,000 ruler / year.
2.3) Sales value
Unit price is 2 LE for 1 ruler.
Sales value = Demand*unit price
= 1,200,000*2
= 2,400,000 LE.
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3) Chapter three: layout.
3.1) Line Layout:
The machines are arranged according to sequence of operations of
the product it’s done for manufacturing one type of product in large
quantities which is excellent in our case since we are only producing
rulers.
Figure 1 Factory layout.
3.2) Advantage of line layout:
1. Production time is lower.
2. Total Material handling cost is lower.
3. Small floor area per unit of production.
4. Simple production control.
5. Greater incentive for workers to work as a team.
3.3) Disadvantage of line layout:
1. Duplication of the equipment in case that machine is needed twice.
2. Investment cost is more.
3. Not a flexible layout in case I needed to change the design of my
existing product or change to a new type of product.
4. In the event of a breakdown of one machine the production will stop.
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Figure 2 factory layout (top view)
Figure 3 factory layout (3rd view)
Figure 4 factory layout (full view)
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3.4) Product storage:
Its in the same building which makes for
• Easier to take care of the product (not getting damaged in
shipping).
• Saving the cost of renting separate storage.
• Saving the cost of transporting the product to storage.
3.5) utilities are in the same building.
• Offices.
• Maintenance.
• Light.
• Communications.
• Fire protection.
3.6) Administrative area separation
Which contributes to lower noise in the administrative area.
3.7) Production line is in one building one floor:
3.7.1) One building
Which benefits us as:
1. Lower space needed which is lower cost.
2. Easy control of production line and maintenance.
3. Minimum utilities needed.
4. Flexibility in planning.
3.7.2) One floor:
Which benefits us as:
1. Suitable for Heavy machines.
2. Light ceiling.
3. Small number of columns which is less wasted area.
4. No wasted area for ladders
5. No wasted area for an elevator.
6. Simple internal transportation.
7. We can use natural light from ceiling.
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4) Chapter Four: Cost analysis and profitability.
4.1) Total investment cost:
4.1.1) fixed investment.
❖ Building. 600,000 L.E
❖ Plant machinery. 300,000 L.E
❖ Auxiliary equipment. 60,000 L.E
4.1.2) preproduction capital cost:
❖ Pre investment study. 20,000 L.E
❖ Engineering. 15,000 L.E
❖ Training. 20,000 L.E
4.1.3) net working capital:
❖ raw material imported. 400,000 L.E
❖ raw material local. 100,000 L.E
❖ inventory. 50,000 L.E
Total investment cost =1,565,000 L.E
4.2) Total production cost:
❖ Raw materials. 1,000,000 L.E
❖ spare parts (5% of the equipment’s). 18,000 L.E
❖ Salaries (20 employee). 360,000 L.E
❖ Maintenance. 10,000 L.E
❖ Depreciation of the building (5%). 30,000 L.E
❖ Depreciation of the machinery (10%). 36,000 L.E
Total = 1,454,000 L.E.
❖ sales and distribution (25%) = 250,000 L.E.
Total production cost = 1,454,000 + 250,000 = 1,704,000 L.E.
4.3) Net profit:
❖ Net profit = sales value – total production.
= 2,400,000 - 1,704,000 = 696,000 L.E.
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4.4) Return on investment (ROI):
ROI = Net profit / Total investment
= 696,000/ 1,565,000 = 44.47 %.
4.5) Break-even point (BEP):
BEP is the point at which sales value equal to production cost, so in order
to be profitable the project must exceed the BEP.
Figure 5 BEP Analysis.
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5) Chapter five: Time plan.
Activity from month to month Time interval
Study. 1 2 1
Equipment contracting. 2 4 2
Manufacturing of equipment. 4 8 4
Setting up the equipment. 4 10 6
Construction of the building. 4 8 4
Auxiliary equipment contracting. 6 8 2
Setting up auxiliary equipment. 8 10 2
Utility. 7 10 3
Hiring employees. 4 12 8
Advertisement. 9 12 3
Furniture. 6 12 6
Commissioning. 10 12 2
Time Plan
commusiening
furneture
advertesment
employee
uitility
Activities
erection of auxiliary equipment
auxiliary equipment
construction of building
erection of equipment
manufacturing of equipment
equipment contract
study
0 1 2 3 4 5 6 7 8 9 10 11 12
Months
Figure 6 Time Plan.
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Conclusion
This chapter summarizes the main findings of the report and provides a
profound objective look on factory planning with the consideration of most
hurdles.
Our focus in this report was on making project planning report for a Plastic
ruler factory.
We evaluated manufacturing concepts and layout variants for the new
factory to gain the knowledge to choose the ideal factory layout.
The line layout was found to be most suitable for our plastic ruler factory.
Furthermore, we did complete cost and profitability analysis for our plastic
ruler factory and found it profitable.
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References
1) Project Management by prof. Osama Emam, Helwan University,
2021.
2) Project Management: Achieving Competitive Advantage, 3rd
Edition, Pinto, 2013.
3) Project Management: Process, Technology, and Practice, Ganesh
Vaidyanathan. 2013.
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