CYBER CAFÉ

1. INTRODUCTION

In today’s world, everything is connected to Internet world. People need to use

Internet and Computer for various activities such as browsing, emails, video
conferencing, for use of various government applications, document/presentation
preparation. Cyber café is such place where with prescribed fee, public can
access to internet and computer services. Here, project profile is prepared for
cyber café which provides facility of video calling and printing services.

2. SERVICE AND ITS APPLICATION

Cyber café where computers are loaded with basic software, web camera and
high speed internet infrastructure can provide services related to Internet on
hourly basis to public.

3. DESIRED QUALIFICATION FOR PROMOTER

There is no specific need in qualification for operating Cyber Café.

4. INDUSTRY LOOK OUT AND TRENDS

In today’s world electronic communication is playing a big role in India. Due to

fast growing of IT sector there is demand for these types of cyber cafés for
sending communication for various destinations. These types of cafes can be set
up in district headquarters and Block headquarters. This facility can be utilised
by educated people, government offices, institutions etc.

5. MARKET POTANTAIL AND MARKETING ISSUES. IF ANY

The IT services sector, being the fastest growing has tremendous potential for
growth. India is one of the leading nations in e-commerce and other IT enabled
services. The younger generation is very much inclined towards computer and IT.
These factors have created a need for Cyber cafes servicing centre with IT
enabled services. The Plant and machinery for the project is available in local
market.

6. RAW MATERIAL REQUIREMENT

1. Computers, with basic software and web camera

2. Colour Printer and scanner
3. Air Conditioner
4. UPS/Inverter

7. SERVICE PROCESS OUTLINE

Setup of a computer business centre requires below steps to follow.

1. Location
 Location of cyber café should be in a busy area with good amount of
residents and schools.

2. Fixed Investment
 Computers and its suppliers need to be decided. Internet service
provider with high speed internet need to be decided.

3. Office Furniture and Installation of Computers

8. MANPOWER REQUIREMENT

Sr. No. Description Total

1 Entrepreneur (self) ₹ 12,000.00
2 Technical/Office Support – 2 @ Rs 10000 Per ₹ 20,000.00
Month

9. IMPLIMENTATION SHEDULE
The project can be implemented in a period of 3 to 5 months by performing the
various activities in a systematic manner and simultaneous application of various
common activities as mentioned below:

SR. No Task Description Duration

1. Preparation of project reports 15 Days (1st Month)
2 Essential registration 15 Days (1st Month)
3 Site Selection 5-10 Days (1st Month)
4 Arrangement of Finance/ loan 30 Days (2nd Month)
5 Arrangement of ranted accommodation 30 Days (2nd Month)
6 Machinery and Equipment purchase 10 Days (3rd Month)
7 Recruitment of staff and labour 10 Days (3rd Month)
8 Installation of Machinery 10 Days (3rd Month)
9 Trial Operation 4th Month
10 Commercial Operation 5th Month

10. COST OF PROJECT

Sr. No. Particulars Amount in Rs

1 Land ₹ 0.00
2 Building ₹ 0.00
3 Equipments/ Other fixed investment ₹ 6,32,600.00
4 Working Capital Margin (3 Months) ₹ 1,19,490.00
5 Total Cost of Project ₹ 7,52,090.00

(a) FIXED CAPITAL CALCULATION

Sr. No. Description Qt Amount Total

y
1 Computer System with Basic Software and Web 20 ₹
Camera 25,000.00 ₹ 5,00,000.00
2 Colour Printer with Scanner 1 ₹
15,000.00 ₹ 15,000.00
3 UPS/Inverter 10 ₹
2,500.00 ₹ 25,000.00
4 Air Conditioner 1 ₹
25,000.00 ₹ 25,000.00
Sub Total ₹
5,65,000.00
5 Internet Infrastructure 1 ₹
5,000.00 ₹ 5,000.00
6 Furniture 1 ₹
40,000.00 ₹ 40,000.00
7 Electrification 1 ₹
22,600.00 ₹ 22,600.00
Total ₹
6,32,600.00

(b) WORKING CAPITAL CALCULATION (PER MONTH)

Sr. No. Description Total

1 Salary ₹ 18,000.00
1a Entrepreneur ₹ 10,000.00
1b Technical/Office Support ₹ 8,000.00
2 Raw Material ₹ 1,830.00
2a Internet Connection Charges ₹ 700.00
2b Paper Ream (500 Pages) (70 GSM) ₹ 780.00
2c Ink cartridge refilling, Powder for toner refilling etc. ₹ 350.00
3 Utilities - Power ₹ 6,500.00
4 Other Expenses ₹ 3,500.00
4a Advertising/Marketing/Social Media ₹ 150.00
4b Stationery ₹ 350.00
4c Telephone ₹ 500.00
4d Repair and Maintenance ₹ 2,000.00
4e Insurance ₹ 250.00
4f Misc ₹ 250.00
5 Rent ₹ 10,000.00
Total ₹ 39,830.00

11. MEANS OF FINANCES

Sr. Description Percentage Amount (Rs)

No.
1 Promoter's Contribution 25% ₹ 1,88,022.50
2 Term Loan/Bank Finance 75% ₹ 5,64,067.50
Total ₹ 7,52,090.00

(a) Cost of Operation

Sr. Particulars Amount in

No. Rs
Variable Cost
1 Raw Material and Other direct ₹ 5,330.00
inputs
2 Salary (60%) ₹ 10,800.00
3 Power (70%) ₹ 4,550.00
Variable Cost 1 Month ₹ 20,680.00
Total Annual Variable Cost ₹
2,48,160.00
Fixed Cost
1 Overheads ₹ 10,000.00
2 Salary (40%) ₹ 7,200.00
3 Power (30%) ₹ 1,950.00
Sub Total ₹ 19,150.00
Total for 12 Months ₹ 2,29,800.00
 4 Interest ₹ 67,688.10
5 Depreciation on Equipments @ ₹ 51,500.00
10%
6 Depreciation on Furniture @ 20 % ₹ 8,000.00
Total Fixed Cost ₹
3,56,988.10
Total Cost of Production ₹
6,05,148.10

(b) Turnover

Unit Qty Revenu Monthly Amount

Sr.
Description Pric Unit per e per (25 Working
No.
e Day Day Days)
Internet Browsing ₹ ₹ 80,000.00
1 ₹ 20 Hour 140
(20 PCs x 8 hours) 2,800.00
Printing Documents ₹ 5,000.00
2 ₹ 10 Pages 10 ₹ 100.00
Colour
Printing Documents ₹ 9,375.00
3 ₹5 Pages 50 ₹ 250.00
B/W
4 Scan ₹5 Pages 10 ₹ 50.00 ₹ 2,500.00
Monthly Gross Income ₹ 96,875.00
Total Yearly Gross Income ₹ 11,62,500.00

12. WORKING CAPITAL REQUIREMENTS

Sr. No. Description Total
1 Entrepreneur ₹ 10,000.00
2 Technical/Office Support ₹ 8,000.00
3 Internet Connection Charges ₹ 700.00
4 Paper Ream (500 Pages) (70 GSM) ₹ 780.00
5 Ink cartridge refilling, Powder for toner refilling etc. ₹ 350.00

13. LIST OF MACHINARY REQUIRD

Sr. No. Description Qt Amount Total

y
1 Computer System with Basic Software and Web 20 ₹
Camera 25,000.00 ₹ 5,00,000.00
2 Colour Printer with Scanner 1 ₹
15,000.00 ₹ 15,000.00
3 UPS/Inverter 10 ₹
2,500.00 ₹ 25,000.00
4 Air Conditioner 1 ₹
25,000.00 ₹ 25,000.00
All the machines and equipments are available from local manufacturers. The
entrepreneur needs to ensure proper selection of product mix and proper type of
machines and tooling to have modern and flexible designs. It may be worthwhile
to look at reconditioned imported machines, dies and tooling. Some of the
machinery and dies and tooling suppliers are listed here below:
1 Impressive Computers
Hasan Ali House No. 4/41-A,
Noor Baug, Umerkhadi,
Mumbai - 400009,
Maharashtra, India

2 Computer Planet
Shop No. 1, Shaniwar Peth-53,
Opposite Amruteshwar Mandir,
Amruteshwar Co Operative Housing Society,
Near Shaniwar Wada,
Pune – 411030,
Maharashtra, India

3 Visicube Technologies Private limited

Door No. 1-8-315,
Begumpet, Opposite US Consulate,
Hyderabad - 500016,
Telangana, India

4 Micon Automation Systems Private Limited

A-814, Siddhi Vinayak Towers,
Behind DCP Office, Makarba,
Ahmedabad - 380051,
Gujarat, India

5 Adaptek Automation Technology

No. 13, F- 3, 2nd Floor,
Main Road, Adyar Nehru Nagar,
Near H.D.F.C. Bank A.T.M.,
 Chennai - 600020,
Tamil Nadu, India

14. PROFITABILITY CALCULATION

Net Profit (Turnover - Cost of Operation) ₹ 5,57,351.90

Net Profit Ratio (Net profit * 100/Turnover) 47.94%
Rate of Return (Net Profit * 100 / Total Cost of 74.11%
Project)

(a) Profitability Projection

At Full
Sr. Year Wise estimates Capacit
Particulars UOM
No. y
Year 1 Year 2 Year 3 Year 4 Year 5
Capacity
1 % 30 40 50 60 70 100
Utilization
Rs
2 Sales ₹ 3.49 ₹ 4.65 ₹ 5.81 ₹ 6.98 ₹ 8.14 ₹ 11.63
Lakhs
Raw
Materials & Rs
3 ₹ 0.74 ₹ 0.99 ₹ 1.24 ₹ 1.49 ₹ 1.74 ₹ 2.48
Other Direct Lakhs
Inputs
Gross Rs
4 ₹ 2.74 ₹ 3.66 ₹ 4.57 ₹ 5.49 ₹ 6.40 ₹ 9.14
Margin Lakhs
Overheads
Rs
5 Except ₹ 2.30 ₹ 2.30 ₹ 2.30 ₹ 2.30 ₹ 2.30 ₹ 2.30
Lakhs
Interest
Rs
6 Interest ₹ 0.68 ₹ 0.68 ₹ 0.68 ₹ 0.68 ₹ 0.68 ₹ 0.68
Lakhs
Rs
7 Depreciation ₹ 0.60 ₹ 0.60 ₹ 0.60 ₹ 0.60 ₹ 0.60 ₹ 0.60
Lakhs
Net Profit Rs -₹
8 ₹ 0.09 ₹ 1.00 ₹ 1.92 ₹ 2.83 ₹ 5.57
Before Tax Lakhs 0.83
23.71 17.24 27.47
1.88% 34.78% 47.94%
% % %

The basis of profitability calculation:

This unit will have capacity to provide internet browsing 57,600 hours/year;
printing documents 25,200 pages/year(this include B/W and colored prints
both.); data entry and accounting services and online web application support.
(these additional services are depends on requirements) .

The cost of one hour for internet browsing would be 20 INR. Cost for B/W print
will be 5 INR/page and 10 INR/page for colored print. Data entry and accounting
job will be charges 250 INR/hour.
Energy Costs are considered at Rs 7 per Kwh and fuel cost is considered at Rs. 65
per liter. The depreciation of plant is taken at 10-12 % and Interest costs are
taken at 14 -15 % depending on type of industry.

15. BREAKEVEN ANALYSIS

Sr. Particulars UOM Value

No.
1 Sales at Full Capacity Rs Lakhs 11.63
2 Variable Costs Rs Lakhs 2.48
3 Fixed Cost incl. Interest Rs Lakhs 3.57
4 Break Even Capacity % of Installed 39.04
BEP = FC/( Sales -Variable Cost) Capacity
*100

16. STATUTORY / GOVERNMENT APPROVALS

All cyber cafes shall be registered with a URN (Unique Registration Number)
through an agency called as registration agency has been notified by the state
Government in this regard. The requirements of registration shall include: Name
of establishment, Address with contact details including email address, Whether
individual or partnership or sole proprietorship or society or company, Name of
owner, Date of Incorporation, Whether registered or not (if yes, copy of
registration with Registrar of Firms or Registrar of Companies or Societies), Type
of service to be provided from cyber café.

Registration organization chooses the officer to check or investigate cyber cafe

and the PC asset of system set up in that, whenever to check whether the cyber
bistro is working as indicated by the principles specified or not. Inspecting officer
have the privilege to check each related registers, reports and any important
data to the reviewing officer on demand.[ Information Technology Rules-2011]

Licenses expected to open Cyber Café

1. Enlistment of business name with state government, if necessary. A DBA

(Doing Business As) is required at whatever point you are leading business
under a name other than your own. Enrolling a DBA name is commonly
done through state government or area agent’s office.

2. Deals assess permit. This can be acquired from your state Department of
Taxation and Finance. You should keep legitimate data on the things sold
and their sum and the business charge that was gathered.

3. Government charge ID number. You should record a different assessment

form for your business and along these lines should have an elected duty
ID number. You can discover the shape online at www.irs.gov.

4. Acquire building permits. Check with your neighbourhood region for the
sorts of grants required. Get a legitimate counsellor in the event that you
don’t know how to round out the structures—better to pay little expenses
in advance and have genuine feelings of serenity than to have costly
intricacies down the road. [http://www.wikihow.com/Set-up-an-Internet-
Cafe] Entrepreneur may contact State Pollution Control Board where ever
it is applicable.

17. BACKWARD AND FORWARD INTEGRATIONS

The basis for calculation of Production Capacity has been taken on Single Shift
basis on 75% efficiency. The Salaries & Wages, Utilities, Cost of Land and Rents
etc. are based on prevailing rates in 2017-18 in and around Ahmedabad. These
cost factors are likely to vary with time and location. Interest of term loan and
working capital loan has been taken at the rate of 13% on an average prevailing
in 2014-15. This rate may vary depending upon the policy of the financial
Institution/agencies from time to time. The cost of Machinery and Equipment
refer to a particular make/model and the prices are approximate prevailing in
2017-18. The breakeven point percentage indicated is on full capacity utilization.
The project preparation cost etc., whenever required could be considered under
pre-operative expenses.

18. TRAINING CENTERS AND COURSES

There is no specific course in repairing and assembling services, but the most
authorized centre is government authorized “ITI” available in all the cities across
the country. India Training institute of computer technology conducts various
technical courses in different cities to enable students to make a bright career.
Most of our vocational programs are job-oriented with which students can start
earning the day they finish their training or can learn them as a hobby. Students
can join for any of these in vacations as all these are short-term certificate
courses.

Udyamimitra portal ( link : www.udyamimitra.in ) can also be accessed for hand-

holding services viz. application filling / project report preparation, EDP, financial
Training, Skill Development, mentoring etc.

Entrepreneurship program helps to run business successfully is also available

from Institutes like Entrepreneurship Development Institute of India (EDII) and its
affiliates all over India.

Disclaimer:
Only few machine manufacturers are mentioned in the profile, although many
machine manufacturers are available in the market. The addresses given for
machinery manufacturers have been taken from reliable sources, to the best of
knowledge and contacts. However, no responsibility is admitted, in case any
inadvertent error or incorrectness is noticed therein. Further the same have
been given by way of information only and do not carry any recommendation.
Source:- Udyami Mitra/Sidbi