Pre-Feasibility Study
Prime Minister’s Small Business Loan Scheme
(Veterinary Clinic)
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, Egerton Road,
Lahore
Tel 92 42 111 111 456, Fax 92 42 36304926-7
helpdesk@smeda.org.pk
REGIONAL OFFICE
PUNJAB
REGIONAL OFFICE
SINDH
REGIONAL OFFICE
KPK
REGIONAL OFFICE
BALOCHISTAN
3rd Floor, Building No. 3,
Aiwan e Iqbal, Egerton Road
Lahore,
Tel: (042) 111-111-456
Fax: (042)6304926-7
helpdesk.punjab@smeda.org.pk
5TH Floor, Bahria
Complex II, M.T. Khan Road,
Karachi.
Tel: (021) 111-111-456
Fax: (021) 5610572
helpdesk-khi@smeda.org.pk
Ground Floor
State Life Building
The Mall, Peshawar.
Tel: (091) 9213046-47
Fax: (091) 286908
helpdesk-pew@smeda.org.pk
Bungalow No. 15-A
Chaman Housing Scheme
Airport Road, Quetta.
Tel: (081) 831623, 831702
Fax: (081) 831922
helpdesk-qta@smeda.org.pk
September 2013
Pre-Feasibility Study
Veterinary Clinic
Table of Contents
1. DISCLAIMER .......................................................................................................................................... 3
2. PURPOSE OF THE DOCUMENT ......................................................................................................... 4
3. INTRODUCTION TO SMEDA............................................................................................................... 4
4. INTRODUCTION TO SCHEME............................................................................................................ 4
5. EXECUTIVE SUMMARY....................................................................................................................... 5
6. BRIEF DESCRIPTION OF PROJECT & PRODUCT ......................................................................... 5
7. CRITICAL FACTORS ............................................................................................................................ 6
8. INSTALLED & OPERATIONAL CAPACITIES ................................................................................. 6
9. GEOGRAPHICAL POTENTIAL FOR INVESTMENT ...................................................................... 6
10. PROJECT COST SUMMARY .............................................................................................................. 6
10.1. PROJECT ECONOMICS ........................................................................................................................ 7
10.2. PROJECT FINANCING ......................................................................................................................... 7
10.3. PROJECT COST ................................................................................................................................... 7
10.4. SPACE REQUIREMENT........................................................................................................................ 8
10.5. MACHINERY AND EQUIPMENT ........................................................................................................... 9
10.6. OFFICE EQUIPMENT ......................................................................................................................... 10
10.7. RAW MATERIAL REQUIREMENTS .................................................................................................... 10
10.8. HUMAN RESOURCE REQUIREMENT ................................................................................................. 10
10.9. REVENUE GENERATION ................................................................................................................... 11
10.10. OTHER COSTS.................................................................................................................................. 11
11. CONTACTS OF SUPPLIERS AND EXPERTS ................................................................................ 12
12 . ANNEXURE ......................................................................................................................................... 14
12.1.
12.2.
12.3.
12.4.
12.5.
INCOME STATEMENT ....................................................................................................................... 14
STATEMENT OF CASH FLOW ............................................................................................................ 15
BALANCE SHEET ............................................................................................................................. 16
USEFUL PROJECT MANAGEMENT TIPS ............................................................................................ 17
USEFUL LINKS ................................................................................................................................. 18
13 . KEY ASSUMPTIONS .......................................................................................................................... 21
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Veterinary Clinic
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
September 2013
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Pre-Feasibility Study
Veterinary Clinic
2. 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 Veterinary Clinic
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 it’s successful
management.
Apart from carefully studying the whole document one must consider critical
aspects provided later on, which form basis of any Investment Decision.
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.
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. INTRODUCTION TO SCHEME
Prime Minister’s ‘Small Business Loans Scheme’, for young entrepreneurs, with an
allocated budget of Rs. 5.0 Billion for the year 2013-14, is designed to provide
subsidised financing at 8% mark-up per annum for one hundred thousand
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Veterinary Clinic
(100,000) beneficiaries, through designated financial institutions, initially through
National Bank of Pakistan (NBP) and First Women Bank Ltd. (FWBL).
Small business loans with tenure upto 7 years, and a debt: equity of 90: 10 will be
disbursed to SME beneficiaries across Pakistan, covering; Punjab, Sindh, Khyber
Pakhtunkhwah, Balochistan, Gilgit Baltistan, Azad Jammu & Kashmir and
Federally Administered Tribal Areas (FATA).
SMEDA has been tasked with an advisory role in the implementation of PM’s
scheme by providing fifty (50) updated pre-feasibilities for referencing by SME
beneficiaries and participating banks to optimally utilize their financial resources.
5. EXECUTIVE SUMMARY
This specific Pre-feasibility is for setting up “Veterinary Clinic. Veterinary medicine
is the branch of science that deals with the prevention, diagnosis and treatment of
disease, disorder and injury in animals. The infectious diseases in animals pose a
major threat to animal health and productivity thereby leading to overall economic
loss. The most common diseases are foot and mouth disease (FMD), diarrhea,
fever, respiratory inspections like pneumonia etc. However, these diseases can be
cured through an early diagnosis and proper treatment.
The population of animals is increasing day by day while clinical facilities for these
animals currently lack in Pakistan. This creates an opportunity for setting up
Veterinary Clinic. The project will provide medical facilities such as health check,
vaccination, major and minor surgeries to livestock. The Clinic shall have its own
laboratory and pharmacy run by a licensed veterinary compounder.
The total project cost for Veterinary Clinic is estimated at Rs. 1.84 million out
which capital cost is Rs. 1.44 million and working capital Rs. 0.39 million. The
project is proposed to be financed through 90% debt and 10% equity. The project
NPV is calculated to be around Rs. 1.84 million, with IRR 28% and payback period
of 3.64 years.
It is assumed that the clinic shall handle 4,514 cases. The total staff requirement
for the project will be 7. The proposed location for project depends upon sizeable
population of livestock such as Sahiwal, Pakpattan, Okara, DI Khan, Lasbela,
Sukur etc.
6. BRIEF DESCRIPTION OF PROJECT & PRODUCT
This particular project is for establishing a Veterinary Clinic as large number
animals die due to infectious ailments annually causing economic loss to the
farmers and national output. However, it is pertinent to mention that most of these
diseases are curable through appropriate diagnosis and treatment.
The project can be started in rented premises. It will provide veterinary health care
services such as, health check, vaccination, treatment and minor and major
surgeries for livestock. The services will be extended not only to the farmers
bringing in their animals to the clinic, but field visits will also be carried out to
provide onsite diagnosis and medication.
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Veterinary Clinic
The clinic will be established in rented premises having a covered area of around
3,000 sqft.
Since, an early diagnosis usually leads to accurate and successful treatment of the
diseased animal, clinic’s diagnostic laboratory will be established to render
necessary tests. The Project shall have a fully equipped surgical suite and welltrained staff to perform surgeries. A fully equipped pharmacy will also be run by a
licensed Veterinary Compounder.
The project will employ 7 individuals including the owner manager for providing
standardized animal healthcare and support services.
7. CRITICAL FACTORS






Background knowledge, experience and technical qualification of the
entrepreneur.
Appropriate project location with catchment area having sizeable livestock
population.
Hiring of qualified and responsive staff to meet client’s requirements.
Retention of staff through incentives to ensure smooth and regular services.
Coverage of maximum area of operation and capturing the market through field
visits and quality of service.
Competition with non-qualified vet through competitive fee structure and
standardized services.
8. INSTALLED & OPERATIONAL CAPACITIES
Since this is a service based venture, there are no installed capacities, however,
based on 300 operational days per year, the clinic a year with capacity to manage
4,514 cases per annum. The project will handle around 3,610 cases by operating
at 80 % of capacity utilization in first year.
9. GEOGRAPHICAL POTENTIAL FOR INVESTMENT
Selection of district or particular city of the project has an imperial effect on the
project itself. The proposed location should be near the area where population of
animals is greater in numbers. The proposed project location for the veterinary
clinic is suggested to be at Sahiwal or comparable districts across Pakistan. Such
as Sargodha, Sheikhupura, Faislabad, Jhang, Sialkot, Sahiwal, Peshawar, DI
Khan, Sukur, Lasbela, Qilla Saifullah and other similar cities/areas.
10. PROJECT COST SUMMARY
A detailed financial model has been developed to analyze the commercial viability
of ‘Veterinary Clinic’ project under the Prime Minister’s Small Business Loan
Scheme. 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 appendix
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Pre-Feasibility Study
10.1.
Veterinary Clinic
Project Economics
All the figures in this financial model have been calculated for rendering services
to the live stock & poultry farmers. The following table shows internal rates of
return and payback period.
Table 1: Project Economics
Description
Internal Rate of Return (IRR)
Payback Period (yrs)
Net Present Value (NPV)
Details
28%
3.64
1,844,609
Returns on the scheme and its profitability are highly dependent on the availability
of efficiency of qualified Vet doctors and trained staff, provision of accurate and
quality service on time and ability to handle emergency cases by accurate
diagnosis and successful treatment.
In case Veterinary Clinic Project is not very efficient, it will not be able to cover the
potential market. Hence, cost of operating the business will increase.
10.2.
Project Financing
Following table provides details of the equity required and variables related to
bank loan;
Table 2: Project Financing
Description
Details
Total Equity (10%)
Rs. 184,636
Bank Loan (90 %)
Rs. 1,661,720
Markup to the Borrower (%age/annum)
8%
Tenure of the Loan (Years)
7
10.3.
Project Cost
Following requirements have been identified for operations of the proposed
business.
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Veterinary Clinic
Table 3: Capital Investment
Capital Investment
Machinery & equipment
Furniture & fixtures
Office vehicles
Office equipment
Pre-operating costs
Training costs
Total Capital Costs
Raw material inventory
Upfront building rent
Upfront insurance payment
Cash
Total Working Capital
Total Project Cost
10.4.
(Rs.)
695,000
258,500
20,000
73,600
251,965
50,000
1,449,065
64,119
180,000
6,000
147,172
397,290
1,846,355
Space Requirement
The area has been calculated on the basis of space requirement for management
office, pharmacy, animal shed, operation theatre, laboratory, Veterinary Doctor’s
office, Vet. Assistant’s room, kitchen, washrooms, waiting area and some open
area. Following table shows calculations for project space requirement.
Table 4: Space Requirement
Building and Civil Work
Animal Sheds/ Animal Holding Area
Operation Theater
Management Office
Pharmacy
Vet. Doctors Office
Veterinary Assistants' Room
Laboratory
Kitchen
Wash Rooms
Waiting Room/Reception
Open area
Total Space Required
September 2013
Space Required (Sq. ft)
500
500
400
120
240
100
350
80
108
100
500
2,998
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Pre-Feasibility Study
Veterinary Clinic
The veterinary clinic is assumed to be established at rented property. The monthly
rent is estimated to be Rs. 30,000 per month.
10.5.
Machinery and Equipment
Following table provides list of machinery and equipment required for an average
foundry unit working for electrical fan sector. Following laboratory equipments and
installations are required.
Table 5: Machinery & Equipment
Items
No. of Items
Surgical Kit
Dystocia Kit
Refrigerator
Lab Equipment
- Micro Scope (Binocular)
- Blood Analyzer
- Centrifugal Machine
- Autoclave Machine
Other Lab equipments
Total
Unit cost (Rs.)
Total (Rs.)
1
2
1
15,000
10,000
30,000
15,000
20,000
30,000
1
1
1
1
1
60,000
450,000
50,000
20,000
50,000
60,000
450,000
50,000
20,000
50,000
695,000
Following office furniture and equipments are required for vet hospital.
Table 6: Furniture & Fixture
Items
Doctors' Room Tables
Doctors' Room Chairs
Visitors' Chairs
Veterinary Assistants' Room Tables
Veterinary Assistants' Room Chairs
Visitors' Chairs
Pharmacy Table
Pharmacy Chair
Laboratory Table
Laboratory Chairs
Operation Theatre - Steel Table
Computer Tables
Computer Chairs
Reception Table
Bench for visitors
Total
September 2013
No. of
Items
1
1
3
1
1
2
1
1
1
2
2
1
1
1
4
9
Cost (Rs.)
15,000
3,500
2,500
10,000
2,000
2,500
10,000
2,000
10,000
2,000
20,000
10,000
2,000
7,500
5,000
Total (Rs.)
15,000
3,500
7,500
10,000
2,000
5,000
10,000
2,000
10,000
4,000
40,000
10,000
2,000
7,500
20,000
178,500
Pre-Feasibility Study
10.6.
Veterinary Clinic
Office Equipment
These costs are based on the assumption that a setup will be required to carry on
the activities at veterinary clinic. Following office equipment is required.
Table 7: Office Equipment
Description
No. of Items
Unit Cost (Rs.)
Computers
1
Printer
1
Fax Machine
1
Telephone Sets
3
Air Conditioners
1
Electric Installations
Total
Office Vehicles required for the project are as follows:
45,000
15,000
10,000
1,200
55,000
Total (Rs.)
45,000
15,000
10,000
3,600
55,000
25,000
153,600
Table 8: Office Vehicle
Motor Cycles (100 cc)
Total
Number
2
Cost
60,000
Amount (Rs.)
120,000
120,000
The proposed project will be using Two Motor cycles costing Rs. 60,000/- each to
cover the outdoor cases.
10.7.
Raw Material Requirements
It is assumed that 25% of the revenues would be spent on the purchase of stock of
veterinary medicines and the sales margin on medicines is 15%.
10.8.
Human Resource Requirement
Table 9: Human Resource Rquirement
Description
No. of
Employees
Admin. & Accounts Officer
1
Veterinary Doctors
1
Veterinary Assistants
1
AI Technicians
1
Receptionist / Operator
1
Security Guard, Gate Keepers
1
Office Boy cum sweeper
1
Total
7
Monthly Salary
(Rs.)
15,000
30,000
10,000
10,000
9,000
9,000
9,000
Annual Salary
(Rs.)
180,000
360,000
120,000
120,000
108,000
108,000
108,000
1,104,000
The table above provides details of human resource required for the project.
Salaries of all employees are estimated to increase at 10% annually.
September 2013
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Pre-Feasibility Study
10.9.
Veterinary Clinic
Revenue Generation
The table below shows revenue generation.
Table 10: Revenue Generation
Particulars
Expected No. of
patients/ year
Large Ruminants (cattle, buffaloes, camels, horses etc.)
Soft Tissue Surgery Minor
110
Soft Tissue Surgery Major
55
Out Door animals
700
Artificial Insemination
400
Castration
100
Parturition Cases
300
Small Ruminants (goats and sheep etc.)
Soft Tissue Surgery Minor
160
Soft Tissue Surgery Major
110
Out Door Fee per animal
1,000
Indoort patients - Admission
175
Castration
500
Sub Total
3,610
Income from Farm visits
Revenue in
Year 1
300
5,000
300
500
200
5,000
33,000
275,000
210,000
200,000
20,000
1,500,000
200
300
100
200
100
32,000
33,000
100,000
35,000
50,000
2,488,000
280,000
Sale of Medicine
Total Revenue
10.10.
Fee in
Rs.
309,693
3,077,693
Other Costs
An essential cost to be borne by the company is the fuel cost incurred by staff
during their outdoor visits to deliver the services. It is estimated that each
motorcycle would be used for travelling of 100 kms per day for 280 working days
annually. Cost of fuel is taken to be Rs. 5.0 per km which will increase at the rate
of 10% (rate of inflation) per year. In year one therefore, fuel cost amounts to Rs.
94,769 for two motor cycles.
Similarly, electricity expense is estimated to be about 12,000 per month. The gas
expense is estimated to be Rs. 2,000 per month. The communication during field
visits is very necessary to keep the staff informed about the cases. The
communication charges are estimated to be Rs. 3,000 per month.
The other office expenses related to stationery, entertainment and janitorial
services are expected to be Rs. 36,000 per annum.
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Veterinary Clinic
It is estimated that marketing would be done to promote the services of veterinary
clinic through local media resources such as newspapers and cable networks.
These promotional expenses are expected to be Rs. 40,000 per annum.
11. CONTACTS OF SUPPLIERS AND EXPERTS
Pakistan Veterinary Medical Council
(PVMC)
Government of Pakistan
House# 850, St.No. 26, G-9/1, Islamabad
Ph: +92-51-9262108,Fax: +92-519262106
A&K Pharmaceuticals
94-A,Punjab Small Industrial Estate,
Sargodha Road, Faisalabad
Ph: 041-8869076
Web. www.aandkpharma.com
ICI Pakistan Ltd.
63 Mozang Road, Lahore
Ph: 042-36302685,
Web. www.akzonobel.com/pk
Agriprom Pakistan (Pvt) Ltd
80-A Judicial Colony, Thokar Niaz
Baig, Lahore
Ph: 042-35310854, 35063332
Web www.agriprom.pk
Attabak Pharmaceuticals
Plot 5-C, Sector I-10/3, Service Road,
Industrial Area, Islamabad
Ph: 051-4434125
Web. www.attabak.com
Ghazi Brothers
Ghazi House, D-35, K.D.A Scheme No.
1, Miran Muhammad Shah Road,
Karachi
212- Defence Road, Lahore
Ph: 021-111250365, 042-35341260-61
Pfizer Laboratories Ltd.
12-Dockyard Road, West Wharf, Karachi
Ph: 021-2310051, 2310053
Web. www.pfizer.com.pk
Naseem Traders International
12, Satellite Plaza, 6th Road,
Rawalpindi
Ph: 051-4421339
Web. www.naseemtraders.com
Prix Pharmaceutical
26-Abbot Road, Lahore
Ph: 042-36312582, 36316499
Web. www.prixpharma.com
Orient Animal Health
Suiete No. M-16, Falak Niaz Tower,
Opp. Jinnah Airport, Shahrah-e-Faisal,
Karachi
Ph: 021-34494555, Web.
www.oah.com.pk
Saadat International
117 - Habitat Apartment, Shadman II, Jail
Road, Lahore
Ph: 042-37550143-5, 37522528 - 30
Web. www.saadatinternational.com
Selmore Pharmaceuticals (Pvt.) Ltd.
36 Km, Multan Road, Lahore
Ph: 042-35380381
Web. www.selmorepharma.com
UM Enterprises
786 - Sharjah Centre, 3rd Floor, 62
September 2013
Star Laboratories (Pvt) Ltd.
23, K.M. Multan Road, Lahore
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Pre-Feasibility Study
Veterinary Clinic
Shadman Market, Lahore
Ph: 042-37566937-8
Ph: 042-7511331
Web. www.starlabs.com.pk
Delta Chemical & Machinery
Corporation
28/2 Taj Arcade, 73-Jail Road, Lahore
Tel. 042-7568704
Web. www.deltachemcorp.com
Symans Pharmaceuticals (Pvt.) Ltd.
1st Floor Symans Tower 25-Lower Mall,
Lahore
Tel: 042-37248226
Web. www.symans.org
Selmore Pharmaceuticals (Pvt.) Ltd.
36 Km, Multan Road, Lahore
Ph: 042-35380381
Web. www.selmorepharma.com
September 2013
Bio- Labs
Plot # 145, Kahuta Industrial Triangle.
Kahuta Road. Islamabad
Ph: 051 4491742 & 3
Web. www.bio-labs.net
13
Pre-Feasibility Study
12.
Veterinary Clinic
ANNEXURE
12.1.
Income Statement
Income Statement
Revenue
Year 1
3,077,693
Year 2
3,589,132
Year 3
4,117,503
Year 4
4,405,728
Year 5
4,714,129
Year 6
5,044,118
Year 7
5,397,206
Year 8
5,775,011
Year 9
6,179,261
Year 10
6,611,810
Cost of sales
Purchase of medicines for use and sale
Direct labor
Office vehicles running expense
Vehicle maintenance
Operating costs 3 (direct electricity)
Operating costs 5 (direct gas)
Total cost of sales
Gross Profit
769,423
600,000
94,769
12,000
144,000
24,000
1,644,192
1,433,500
897,283
658,417
104,246
12,600
158,400
26,400
1,857,346
1,731,786
1,029,376
722,521
114,671
13,230
174,240
29,040
2,083,078
2,034,425
1,101,432
792,867
126,138
13,892
191,664
31,944
2,257,936
2,147,792
1,178,532
870,062
138,752
14,586
210,830
35,138
2,447,900
2,266,229
1,261,029
954,772
152,627
15,315
231,913
38,652
2,654,309
2,389,809
1,349,302
1,047,730
167,889
16,081
255,105
42,517
2,878,624
2,518,582
1,443,753
1,149,738
184,678
16,885
280,615
46,769
3,122,439
2,652,571
1,544,815
1,261,679
203,146
17,729
308,677
51,446
3,387,493
2,791,769
1,652,952
1,384,517
223,461
18,616
339,544
56,591
3,675,682
2,936,128
General administration & selling expenses
Administrative Salaries expense
Building rental expense
Travelling expense
Communications expense (phone, fax, mail, internet, etc.)
Office expenses (stationary, entertainment, janitorial services, etc.)
Promotional expense
Insurance expense
Professional fees (legal, audit, consultants, etc.)
Depreciation expense
Amortization of pre-operating costs
Amortization of legal, licensing, and training costs
Subtotal
Operating Income
504,000
360,000
25,200
36,000
36,000
40,000
6,000
15,388
131,638
50,393
10,000
1,214,619
218,881
553,070
396,000
27,654
37,800
37,800
41,200
5,400
17,946
131,638
50,393
10,000
1,308,900
422,886
606,918
435,600
30,346
39,690
39,690
42,436
4,800
20,588
131,638
50,393
10,000
1,412,098
622,327
666,008
479,160
33,300
41,675
41,675
43,709
4,200
22,029
108,086
50,393
10,000
1,500,234
647,557
730,852
527,076
36,543
43,758
43,758
45,020
3,600
23,571
107,350
50,393
10,000
1,621,921
644,308
802,008
579,784
40,100
45,946
45,946
46,371
3,000
25,221
107,350
1,695,726
694,082
880,093
637,762
44,005
48,243
48,243
47,762
2,400
26,986
107,350
1,842,845
675,737
965,780
701,538
48,289
50,656
50,656
49,195
1,800
28,875
107,350
2,004,139
648,433
1,059,810
771,692
52,991
53,188
53,188
50,671
1,200
30,896
107,350
2,180,986
610,782
1,162,995
848,861
58,150
55,848
55,848
52,191
600
33,059
107,350
2,374,901
561,227
Other income (interest on cash)
Earnings Before Interest & Taxes
17,923
236,804
24,895
447,781
47,474
669,800
73,381
720,939
100,435
744,743
126,952
821,035
152,088
827,825
187,948
836,381
234,764
845,546
292,129
853,356
Interest expense on long term debt (Project Loan)
Interest expense on long term debt (Working Capital Loan)
Subtotal
Earnings Before Tax
100,052
27,170
127,222
109,582
88,093
23,874
111,968
335,813
75,149
20,305
95,454
574,347
61,137
16,440
77,577
643,362
45,970
12,254
58,224
686,519
29,553
7,720
37,273
783,762
11,783
2,810
14,593
813,233
836,381
845,546
853,356
Tax
NET PROFIT/(LOSS) AFTER TAX
548
109,034
25,186
310,627
71,793
502,553
96,504
546,858
102,978
583,541
117,564
666,197
142,316
670,917
146,367
690,014
147,971
697,576
149,337
704,019
Balance brought forward
Total profit available for appropriation
Balance carried forward
109,034
109,034
109,034
419,662
419,662
419,662
922,215
922,215
922,215
1,469,073
1,469,073
1,469,073
2,052,614
2,052,614
2,052,614
2,718,811
2,718,811
2,718,811
3,389,728
3,389,728
3,389,728
4,079,742
4,079,742
4,079,742
4,777,318
4,777,318
4,777,318
5,481,337
5,481,337
September 2013
14
Pre-Feasibility Study
12.2.
Veterinary Clinic
Statement of Cash Flow
Cash Flow Statement
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
109,034
131,638
50,393
10,000
548
(252,961)
(14,394)
600
70,680
102,538
310,627
131,638
50,393
10,000
6,712
(21,018)
(16,062)
600
11,878
481,469
502,553
131,638
50,393
10,000
(68,793)
(42,732)
(11,680)
600
11,869
580,218
546,858
108,086
50,393
10,000
(61,336)
(33,559)
(13,122)
600
7,055
610,982
583,541
107,350
50,393
10,000
(65,652)
(24,519)
(14,743)
600
7,606
650,184
666,197
107,350
(98,751)
(26,235)
(16,564)
600
8,202
635,968
670,917
107,350
(81,367)
(28,072)
(18,609)
600
8,848
654,352
690,014
107,350
(83,104)
(30,037)
(20,908)
600
9,548
667,618
697,576
107,350
(83,791)
(32,139)
(23,490)
600
10,307
669,982
704,019
107,350
(84,377)
(34,389)
213,689
600
(8,603)
969,028
1,304,158
357,561
184,636
(145,076)
(39,706)
-
(157,035)
(43,002)
-
(169,979)
(46,571)
-
(183,991)
(50,436)
-
(199,158)
(54,623)
-
(215,575)
(59,156)
-
(233,345)
(64,066)
-
-
-
-
1,846,355
(184,782)
(200,037)
(216,550)
(234,428)
(253,781)
(274,731)
(297,411)
-
-
-
-
-
-
Year 0
Operating activities
Net profit
Add: depreciation expense
amortization of pre-operating costs
amortization of training costs
Deferred income tax
Accounts receivable
Raw material inventory
Advance insurance premium
Accounts payable
Cash provided by operations
Financing activities
Project Loan - principal repayment
Working Capital Loan - principal repayment
Additions to Project Loan
Additions to Working Capital Loan
Issuance of shares
Purchase of (treasury) shares
Cash provided by / (used for) financing activities
Investing activities
Capital expenditure
Cash (used for) / provided by investing activities
(64,119)
(6,000)
(100,119)
(1,449,065)
(1,449,065)
Year 1
-
-
-
-
-
-
-
NET CASH
297,172
(82,244)
281,433
363,667
376,554
396,403
361,236
356,940
667,618
669,982
969,028
Cash balance brought forward
Cash available for appropriation
Cash balance
Cash carried forward
297,172
297,172
297,172
297,172
214,928
214,928
214,928
214,928
496,361
496,361
496,361
496,361
860,028
860,028
860,028
860,028
1,236,582
1,236,582
1,236,582
1,236,582
1,632,986
1,632,986
1,632,986
1,632,986
1,994,222
1,994,222
1,994,222
1,994,222
2,351,162
2,351,162
2,351,162
2,351,162
3,018,780
3,018,780
3,018,780
3,018,780
3,688,762
3,688,762
3,688,762
3,688,762
4,657,790
4,657,790
4,657,790
September 2013
15
12.3.
Balance Sheet
Balance Sheet
Year 0
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
297,172
64,119
6,000
397,290
214,928
252,961
78,512
5,400
584,801
496,361
273,979
94,574
4,800
906,014
860,028
316,711
106,254
4,200
1,327,123
1,236,582
350,270
119,376
3,600
1,753,751
1,632,986
374,789
134,119
3,000
2,193,209
1,994,222
401,024
150,683
2,400
2,601,476
2,351,162
429,096
169,292
1,800
3,009,811
3,018,780
459,132
190,200
1,200
3,733,620
3,688,762
491,271
213,689
600
4,465,061
4,657,790
525,660
5,183,450
Fixed assets
Machinery & equipment
Furniture & fixtures
Office vehicles
Office equipment
Total Fixed Assets
695,000
258,500
120,000
73,600
1,147,100
625,500
232,650
108,000
49,312
1,015,462
556,000
206,800
96,000
25,024
883,824
486,500
180,950
84,000
736
752,186
417,000
155,100
72,000
644,100
347,500
129,250
60,000
536,750
278,000
103,400
48,000
429,400
208,500
77,550
36,000
322,050
139,000
51,700
24,000
214,700
69,500
25,850
12,000
107,350
Intangible assets
Pre-operation costs
Legal, licensing, & training costs
Total Intangible Assets
TOTAL ASSETS
251,965
50,000
301,965
1,846,355
201,572
40,000
241,572
1,841,835
151,179
30,000
181,179
1,971,016
100,786
20,000
120,786
2,200,095
50,393
10,000
60,393
2,458,244
2,729,959
3,030,876
3,331,861
3,948,320
4,572,411
5,183,450
70,680
70,680
82,558
82,558
94,427
94,427
101,482
101,482
109,088
109,088
117,290
117,290
126,138
126,138
135,685
135,685
145,992
145,992
137,389
137,389
548
1,159,083
317,855
1,477,485
7,260
1,002,048
274,853
1,284,161
(61,533)
832,069
228,282
998,817
(122,870)
648,078
177,845
703,054
(188,521)
448,920
123,223
383,621
(287,273)
233,345
64,066
10,139
(368,640)
(368,640)
(451,744)
(451,744)
(535,535)
(535,535)
(619,911)
(619,911)
184,636
109,034
293,670
1,841,835
184,636
419,662
604,297
1,971,016
Assets
Current assets
Cash & Bank
Accounts receivable
Raw material inventory
Pre-paid insurance
Total Current Assets
Liabilities & Shareholders' Equity
Current liabilities
Accounts payable
Total Current Liabilities
Other liabilities
Deferred tax
Long term debt (Project Loan)
Long term debt (Working Capital Loan)
Total Long Term Liabilities
Shareholders' equity
Paid-up capital
Retained earnings
Total Equity
TOTAL CAPITAL AND LIABILITIES
September 2013
-
1,304,158
357,561
1,661,720
184,636
184,636
1,846,355
184,636
922,215
1,106,851
2,200,095
16
184,636
1,469,073
1,653,708
2,458,244
184,636
2,052,614
2,237,250
2,729,959
184,636
2,718,811
2,903,447
3,030,876
184,636
3,389,728
3,574,364
3,331,861
184,636
4,079,742
4,264,378
3,948,320
184,636
4,777,318
4,961,954
4,572,411
-
184,636
5,481,337
5,665,972
5,183,450
Pre-Feasibility Study
12.4.
Veterinary Clinic
Useful Project Management Tips
Technology

List of Machinery & Equipment

Required spare parts & consumables:
Suppliers credit agreements and
availability as per schedule of maintenance be ensured before start of
operations

Energy Requirement: Should not be overestimated or installed in excess and
alternate source of energy for critical operations be arranged in advance

Machinery Suppliers: Should be asked for training and after sales services
under the contract with the machinery suppliers

Quality Assurance Equipment & Standards:
Whatever means required
products quality standards need to be defined on the packaging and a system
to check them instituted, this improves credibility
Marketing

Product Development & Packaging:
Expert's help may be engaged for
product/service and packaging design & development

Ads & P.O.S. Promotion:
Business promotion and dissemination through
banners and launch events is highly recommended. Product broachers from
good quality service providers

Sales & Distribution Network:
agreements are required with.

Price - Bulk Discounts, Cost plus Introductory Discounts: Price should
never be allowed to compromise quality. Price during introductory phase may
be lower and used as promotional tool. Product cost estimates should be
carefully documented before price setting. Government controlled prices shall
be displayed.
Expert's
advise
and
distribution
Human Resources

List of Human Resource

Adequacy & Competencies:
Skilled and experienced staff should be
considered an investment even to the extent of offering share in business
profit.

Performance Based Remuneration:
Attempt
to
manage
human
resource cost should be focused through performance measurement and
performance based compensation.
September 2013
17
Pre-Feasibility Study

Veterinary Clinic
Training & Skill Development:
Encouraging training and skill of self &
employees through experts and exposure of best practices is route to success.
Least cost options for Training and Skill Development (T&SD) may be linked
with compensation benefits and awards.
12.5.
Useful Links
Prime Minister’s Office, www.pmo.gov.pk
Government of Pakistan, www.pakistan.gov.pk
Ministry of Industries & Production, www.moip.gov.pk
Ministry of Education, Training & Standards in Higher Education,
www.moptt.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 Balochistan, www.balochistan.gov.pk
Government of Gilgit Baltistan, www.gilgitbaltistan.gov.pk
Government of Azad Jamu Kashmir, www.ajk.gov.pk
Trade Development Authority of Pakistan (TDAP), www.tdap.gov.pk
Security Commission of Pakistan (SECP), www.secp.gov.pk
Federation of Pakistan Chambers of Commerce and Industry (FPCCI)
www.fpcci.com.pk
Punjab Board of Investment & Trade (PBIT), 23-Aikman Road, GOR-I, Lahore
Tel. 042-99205201, www.pbit.gop.pk
Sindh Board of Investment (SBI), 1st Floor, Tower B, Finance & Trade Center,
Shahra-e-Faisal, Karachi, Tel. 021-99207512-4, www.sbi.gos.pk
State Bank of Pakistan (SBP), www.sbp.org.pk
National Bank of Pakistan (NBP), www.nbp.com.pk
First Women Bank Limited (FWBL), www.fwbl.com.pk
Pakistan Veterinary Medical Council (PVMC), Islamabad,
www.pvmcregistration.net
National Vocational and Technical Training Commission (NAVTTC) Head Quarter,
Islamabad, www.navttc.org
Pakistan Agricultural Research Council (PARC), Islamabad Tel. 051-9203966,
www.parc.gov.pk
National Agricultural Research Centre (NARC), Islamabad, Tel. 051-9255061,
www.parc.gov.pk
National Veterinary Laboratory, NARC, Park Road, Islamabad Tel. 051-9255108
Balochistan Agricultural Research Centre (BARC), Quetta, Tel: 081-9213286-7,
www.parc.gov.pk
September 2013
18
Pre-Feasibility Study
Veterinary Clinic
Southern-zone Agricultural Research Centre (SARC), Karachi, Tel: 021-99261661,
99261561, www.parc.gov.pk
Arid Zone Research Institute (AZRI), Bahawalpur, Tel: 0622-876833,
www.parc.gov.pk
Punjab Livestock & Dairy Development Board (PLDDB), 11- Shami Road, Lahore
Cantt. Tel. 042-36676821, www.plddb.pk
Faculty of Animal Husbandry, University of Agriculture, Faisalabad,
www.uaf.edu.pk
Faculty of Veterinary Sciences, University of Agriculture, Faisalabad,
www.uaf.edu.pk
Faculty of Veterinary and Animal Sciences, Lasbela University of Agriculture,
Water & Marine Sciences, Lasbela, www.luawms.edu.pk
Faculty of Veterinary Sciences and Animal Husbandry, Sindh Agriculture
University, Tondojam, www.sau.edu.pk
Gomal College of Veterinary Sciences, Dera Ismail Khan, www.gu.edu.pk
KPK Agricultural University, Peshawar, www.aup.edu.pk
Pir Mehr Ali Shah Arid Agricultural University, Rawalpindi, www.uaar.edu.pk
University College of Veterinary & Animal Sciences, Islamia University Bahawalpur
(IUB), www.iub.edu.pk
University of Veterinary & Animal Sciences (UVAS), Out Fall Road, Lahore,
www.uvas.edu.pk
College of Veterinary & Animal Sciences, Jhang,
www.uvas.edu.pk/other_campuses
Bahauddin Zakariya University (BZU), Multan, www.bzu.edu.pk
Nestle Sarsabz Training Institute, Renala Khurd, Okara c/o Nestle Lahore, Tel:
0423-111-637-853
Animal Husbandry In-Service Training Institute (AHITI), Peshawar, Tel. 0912960109, 9210309
Veterinary Research Institute (VRI), Ghazi Road, Lahore Cantt., Tel. 04299220140
Al - Haiwan Sires Training Institute, Jogi Chowk, Sahiwal, Tel. 040-4227196,
4221486, 061-6775708, Cell. 0321-8695054, 0300-9695054
Altaf & Co Livestock Training Institute, Altaf & Co Plaza,16/1,Out Fall Road,
Lahore, Tel: 042-35763411-4, www.altafandco.com
Solve Agri Dairy Institute, F-6/2, Main Link Road, Model Town, Lahore,
www.solveagripak.com
Dairy & Rural Development Foundation (DRDF), Lahore, www.dairyproject.org.pk
Agribusiness Support Fund (ASF), Lahore, www.asf.org.pk
Directorate of Animal Health, L&DD, Punjab, Tel: 042-99201115
September 2013
19
Pre-Feasibility Study
Veterinary Clinic
Directorate of Animal Disease Reporting and Surveillance, L&DD, Punjab, Tel:
042-99201116
Foot and Mouth Disease (FMD) Research Centre, L&DD, Lahore, Tel: 04299201115
Directorate of Livestock Farms, L&DD, Lahore, Tel: 042-99201126-7
Directorate of Small Holder Dairy Development, Gujranwala Tel: 055-9200410-11,
9200194
Buffalo Research Institute Bhunikey, District Pattoki, Tel: 049-4421887, 4420072
Directorate of Small Ruminants, Multan, L&DD, Punjab, Tel: 061-9201311
Research Centre for Conversation Sahiwal Cattle (RCCSC), Jhang, Tel: 0479200329, 9200371, www.rccsc.com.pk
Directorate of Livestock Training Centre (LSTC), Bahadurnagar, Okara, Tel: 0442661393
Livestock Training Centre (LSTC), Sheikhupura, Tel: 056-9200056
Livestock & Fisheries Department, Government of Sindh, www.sindh.gov.pk
Agriculture & Livestock Department, Government of KPK,
www.khyberpakhtunkhwa.gov.pk
Cattle Breeding & Dairy Farm, Harichand, District Charsadda, KPK, Tel: 0916640187
Buffalo Breeding & Dairy Farm, D.I.Khan, KPK, Tel: 0966-923150
Livestock & Dairy Development, Government of Balochistan,
www.balochistan.gov.pk
Directorate of Animal Health and Production Extension, L&DD, Quetta, Tel 0819202564
Para Veterinary Training Institute, L&DD, Quetta, Tel: 081-9202564
September 2013
20
Pre-Feasibility Study
Veterinary Clinic
13. KEY ASSUMPTIONS
Table A: Project Assumptions
Projected Life of The Project in Years
Sponsors' Equity
Debt Financing
Annual Mark Up Rate (Short Term & Long Term)
Debt Tenure in Years
General Inflation Rate
Operating Assumptions
Total No. of Days in One Year
Total No. of Months in One Year
No of Working Days in One Year
10
10%
90%
8%
7
10%
365
12
300
Table B: Depreciation Rate Assumptions
Tools & Equipment
Fittings & Installations
Office Equipments
Furniture & Fixtures
Vehicles
10%
10%
33%
10%
20%
of the Written Down Value
of the Written Down Value
of the Written Down Value
of the Written Down Value
of the Written Down Value
Table C: Working Capital Assumptions
Stock of medicines
Stores and Spares
Accounts Payable
Bills
Expenses
30 Days medicines Consumption
30 Days Stores & Spares Consumption
30 Days of Total Annual Purchases
30 Days of Total Annual Expenditure
Table D: Expenditures
Salaries, Wages & other benefits
Inflation Rate for Salaries & Wages
Medicines & Supplies consumed
Repair & Maintenance
Vehicle Repair & Maintenance
Repair & Maintenance
Traveling & Conveyance
Telephone Fax and Postage
Vehicles insurance rate
10%
15% of total revenue
10%
3%
3%
1%
5%
of the Cost.
of the Cost.
of Total income
of Total income
of Written down value
Table E: Expense Assumptions
Description
Cost / Rate
Medicines Consumed and kept
September 2013
25%
21
Rationale
% of revenue
Pre-Feasibility Study
Veterinary Clinic
for Sale
Cost of goods sold growth rate
Vehicle maintenance
Operating costs 3 (direct
electricity)
Operating costs 5 (direct gas)
5.0%
10%
% of vehicle cost
Per annum (Rs. 12,000 per
144,000 month)
24,000 Per annum (Rs. 2,000 per
month)
5.0%
0.0% % of administration expense
5.0% % of administration expense
Operating costs growth rate
Administration benefits expense
Travelling expense
Table F: Vehicle Running Expenses
No.
Class
2
Motor
cycles
Consumption
Rate/Ltr
Traveling/
of petrol
Day (km)
65 Km per Petro 110
100
litre
l
Annual
Tours
280
Total
Total
cost
94,769
94,769
Table G: Promotional Expenses
Description
News Paper Ad
Cable Ad
Quantity
2
10
Table H: Communication Expense
Description
Office vehicles running expense
Office expenses (stationary, entertainment,
janitorial services, etc.)
September 2013
Rs. Per unit
22
5,000
3,000
Per annum
3.0% of vehicles cost
Rs. 36,000 Per annum