Car Rental Services

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(1) INTRODUCTION
Car Rental Services have a surprisingly significant impact for something so seemingly innocuous. As well as being an eyesore, next time you are outside, have a look around you'll be amazed at the number of private Taxis and Cars on our streets . So, now is the time to add more fleet of taxis and cars to the existing private taxis on the streets and provide good rental services. Our unit will help in the same by providing car rental services to the customers who have a car that is temporarily out of reach or out of service”. The firm will be set up by the name of ……. The office would be located in New Delhi, a city known for more travelers in and around the city and with most people working in the NCR. The unit will cater to the needs of customers inside and outside the NCR for traveling, work purposes. • The cars will have all facilities like A/C, FM music player and GPS of the best order and to ensure highest standard we would have a well trained drivers for better safety of our customers. • • • We would have wide range of products ranging from Indica, Tavera, Ambassador and Esteem. Any other requirements and specification of the customer will be provided by our supporting agencies like for luxury cars and for buses and coaches. There would be no compromise on the quality of the cars used for the traveling purposes by our customers. Name of Company : Promoters: Company address: 448/2, Kanti Nagar, New Delhi Type of business: Private limited Company Duration of the report: 2009-13

OBJECTIVE OF THE PROJECT
1. To serve people who have a car that is temporarily out of reach or out

of service.
2. To provide the best car rental services in india for the travelers who

wish to elevate their complete travel experience by traveling through car of their own choice

RATIONALE AND SCOPE OF THE PROJECT RATIONALE:
• • • The car rentals would be provided at very attractive prices. We would provide service according to the requirements and specification of the buyer . The cars would be used in offices like BPOs to ferry their employees from home to office and vice versa and also for people who want for personal use. So next time, hold you want to go on a small trip with your family members or want a cab to go to office then use our services and be a part of this growing industry. SCOPE: Gradually, with the increase in the demand , we will make efforts towards expanding our business by adding more fleet of cars. We would further add cars like indigo, ford ikon, Honda city for our elite class customer and also diversify in the field of renting buses in the future.

REVIEW OF THE INDUSTRY

Car rental agencies primarily serve people who have a car that is temporarily out of reach or out of service, for example travelers who are out of town or owners of damaged or destroyed vehicles who are awaiting repair or insurance compensation. Because of the variety of sizes of their vehicles, car rental agencies may also serve the self-moving industry needs, by renting vans or trucks.

CAR RENTALS Car hire in British English is a company that rents automobiles for short periods of time (ranging from a few hours to a few weeks) for a fee. It is an elaborate form of a rental shop, organized in numerous local branches, primarily located near airports or busy city areas. Car rental agencies primarily serve people who have a car that is temporarily out of reach or out of service, for example travelers who are out of town or owners of damaged or destroyed vehicles who are awaiting repair or insurance compensation. Because of the variety of sizes of their vehicles, car rental agencies may also serve the self-moving industry needs, by renting vans or trucks. Car rentals are subject to many conditions, which vary from one brand to another. The vehicle must be returned in a good condition and must not exceed a maximum driven distance, otherwise extra fees may be incurred. Additionally, some companies set up a minimum age for the vehicle driver, which in some cases is as high as 25, even in countries where the age of majority is much lower. Recent conditions have utilized GPS technology to limit maximum speeds or driving to specific regions.

Major car rental companies
• Cendant:

Avis - Budget Alamo - National Dollar - Thrifty Auto Europe - Beneluxcar - Hertz - Europcar –

• Vanguard:

• Dollar-Thrifty: • Independents:

Enterprise - Kemwel - Rent-A-Wreck - Sixt There was a time in India when the portly Ambassador was India's most coveted and popular car. The Indian car buyer had to wait for months on end and even years before he could lay his hands on an ambassador or a Fiat Padmini, which was usually handed over by nonchalant, supercilious salesmen. It was the Maruti 800, a product of the Japanese car giant Suzuki collaborating with Indian carmaker Maruti which became a veritable watershed in the Indian auto market. It became the small car, which Indian nuclear middle class families aspired to, it was compact and traffic-friendly, it also was easily maneuvered through Indian by-lanes and ‘gallis’ with ease. But now that too is history. India has become one of the world's fastestgrowing car markets with scores of models plying the city roads and highways, from the home-grown Tata’s and Maruti’s to Volkswagens and Rolls Royce’s. Indians have emerged as avid car enthusiasts sporting their prized possessions as status symbols and speed machines. Foreign car companies have discovered the Indian consumer as well as the R & D potential in the Indian technical fraternity and are setting up manufacturing plants right and left across the country at lower costs. The growing desire for cars also is a sign that Indian roads are finally good enough for international cars to ride on. There are many four to six lane highways in India now and the Golden Quadrilateral, which passes through New Delhi, Calcutta, Madras and Mumbai proves that the Indian government takes infrastructure development very seriously.

Millions of Indian families will enter the car boom bracket in the next two years according to surveys. The auto boom in 2004 was with a 29 per cent growth rate was followed by a lull in 2005 due to meteoric fuel costs and more stringent anti-emission policies implemented by the Indian government. Increasing Auto Loan interest rates from the bank also added to the slowdown. But all indicators in 2005 say that household income in India is galloping towards a double-digit pace and 24 million households should be able to ride in a new car by 2007. The Indian automobile market is projected to grow by 7% next year. The economy is booming and the middle class is getting easy finance schemes to upgrade to four wheelers from scooters and motorcycles. In postliberalization India, backward linkages into the manufacturing of auto components have enabled many Indian vendors to foray in to core manufacturing. Trends in new-age Indian auto industry The Customer is King: The most obvious aspect is the proliferation of new manufacturers and the extension of demand in to all sub-segments like mid-size, premium mid-size and super-luxury car segments instead of being limited to the small car segment. The entry of foreign companies and the emerging stiff competition has enabled the setting up of a firm manufacturing foundation, which are allowing companies to develop new products from Indian soil. The Indian government is embarking on setting stringent standards on emission and safety related parameters for the auto industry and this has in turn elevated the general standards in a crowded market. Features like antilock braking systems, common rail injection, airbags and tiptronic transmission are now becoming customary in most mid-size and first-rate small cars. To speed things up, the average Indian car buyer is increasingly savvy with his auto-facts and is a highly informed buyer, networked via the internet and a spate of foreign and local journals and cable channels keeping him up to speed on the what, when, where and why of the auto world.

CAR RENTAL COS ADOPT NOVEL WAYS TO LURE CUSTOMERS

Renting a car is no longer about just plain hiring a cab. With more and more international players jumping into this fast-growing business, car rental companies are coming up with innovative strategies ranging from packages targeted at women to promoting the self-drive concept to even auctioning rent-a-car packages online to push sales. Rental packages European rentals major Sixt, for instance is planning to auction car rental packages online starting at Re 1 in addition to marketing pre-paid vouchers for both in-bound and outbound travelers. They have tied up with leading travel Web sites for auctioning the packages. In addition, with the popularity of travel Web sites increasing, we are increasingly leveraging upon these tie-ups to offer facilities such as airport transfers. According to estimates, over 5000 air tickets are booked daily on the top domestic travel Web sites. Sixt is also planning to market rentals packages for lady corporate travellers, which among other safety/convenience features provides lady chauffeurs. Self-drive biz Meanwhile, with the concept of weekend getaways gaining popularity, car rental companies are increasingly betting on the self-drive business as well. Sixt would be focusing on Goa and Kochi for its self-drive business. Sixt, which is rapidly expanding its presence across the country, is targeting its fleet to over 5,000 cars over the next 18-20 months.

So customers will be able to walk into Hertz offices and drive away with a car of their choice. Self-drive is what distinguishes a taxi service from a car rental company. World over Hertz is the largest car rental company and we plan to make it the number one in India. The company will invest Rs 225 crore (Rs 2.25 billion) over the next three years to buy vehicles and the infrastructure to back it. Talks are on with a financial institution for the cash. Hertz has its route map clearly charted out. It's looking at four major areas -chauffeur-driven cars for corporates, travel desks at hotels, self-drive and fleet management. In 2002, Hertz conducted a survey and found that around 150,000 cars were registered as taxis. The industry is estimated to be around Rs 3,000 crore (Rs 30 billion). Of this only around 10 per cent is organised and includes around 20 players across the country. The big names are Avis, which has tied up with the Oberoi Hotels, Travel House, which has a tie-up with ITC WelcomGroup Hotels, and Orix, which has a tie-up with IL&FS. Most of the other players treat car rental as a secondary business meant to promote another business. Hertz also plans to cater to small and medium enterprises and professionals. It initially plans to strike deals with companies with which it already has a working relationship. Currently, Hertz provides chauffeur-driven cars to nearly 400 companies including IBM, Sony, KPMG, Compaq, etc. Hertz is looking at customers who feel a driver is a hindrance and he divides customers into three different types. One is the fuel-conscious customer who hires a car to go on a holiday with his family and would like a fuel-efficient car. Second is a person who may be driving an Ikon or Esteem, but would like to try an SUV. Thirdly, there's the person who may on special occasions like to go all out and drive a Mercedes or some other luxury car. Around the world Hertz has agreements under which vehicle manufacturers buy back cars. In India too it has similar deals and the manufacturers buy back cars after three years. It has taken Hertz a long time to get into high gear. Now it's getting ready to move at high speed.

A. PRODUCTS AND THEIR SPECIFICATIONS AMBASSADOR (Standard Car) (Non Air Conditioned) Spacious, safe and good value for money and most popular car used by tourists. Passengers : 4 (Including Driver) Luggage : 4 (Incl. roof top carrier) (Air Conditioned) Spacious, safe and good value for money and most popular car used by tourists. Passengers : 4 (Including Driver) Luggage : 4 (Incl. roof top carrier)

TATA SAFARI (4X4) (6 seater / suv)(Air Conditioned)India's best 4 wheel drive and safest vehicle with dual air-conditioning and is most suitable for small group and families. Passengers : 6 (Including Driver) Luggage : 3 (Incl. roof top carrier) TATA SUMO (6 seater standard)(NonAir Conditioned)India's best 4 wheel drive and safest vehicle most suitable for small group and families Passengers : 6 (Including Driver) Luggage : 5 (Incl. roof top carrier)

TATA INDICA (Standard Car)(Air Conditoned) Compact car from Tata's, one of the most experienced automobile manufacturers in India. Passengers : 4 (Including Driver) Luggage : 3 (Incl. roof top carrier) MITSUBISHI LANCER (Luxury Car) (Air Conditioned)Most Successful car in its class in India manufactured by Japanese car manufacturers Mitsubishi Motors. Passengers : 4 (Including Driver) Luggage : 3 (Incl. roof top carrier) TOYOTA QUALIS (6 seater) (Air Conditioned) By Toyota Japan offers best A/c and comfort in its class. Recommended for small groups or large family. Passengers : 6 (Including Driver) Luggage : 5 (Incl. roof top carrier)(Air Conditioned) TOYOTA QUALIS (8 seater) By Toyota Japan offers best A/c and comfort in its class. Recommended for small groups or large family. Passengers : 8 (Including Driver) Luggage : 5 (Incl. roof top carrier)

Chevrolet Tavera Manufacturer - General Motors India Ltd. EnginePower- 2.6L Direct Injection Turbo Diesel Number of cylinders 4, inline, traverse mounted Piston Displacement 2489 cc Max. Power 84 PS @ 3800 rpm Max. Torque 18 Knm @ 1700 rpm Dimensions - Length 4335 mm Width 1690 mm Height 1775 mm Ground Clearance 194 mm Boot Space: Four normal size suitcase Toyota Innova Manufacturer - Toyota Kirloskar Motors Ltd. Engine- No. of Cylinders - 4 cyls.in-line, Diesel Displacement(cc) - 2446 CC Maximum Power(bhp/rpm) - 75 bhp /4200 rpm Maximum Torque(Kgm/rpm) 15.4 kgm / 2400 rpm Dimensions: Overall Height(mm) 1880 mm Overall Length(mm) 4425 mm Overall Width(mm) 1655 mm Ground Clearance(mm) 178 mm Kerb Weight 1540 kg Boot Space : In Build Covered Carrier at the roof with a capacity of 7-10 Normal size Bags/ Suit cases

B. USES OF THE PRODUCT
1. Official Purpose

The cars would be used to give pick-up and drop service for the employees working in BPOs and other companies from their home to their place of work and vice versa.

2. Peronal Purpose The cars would also be used by customers for their personal use like going on a short trip with the family and requiring our services.

C. SUPPORTING AGENCIES FOR CARS:  

DEV TOURS AND TRAVELS, GURGAON DHANOA TOURIST TAXI SERVICE, NEW DELHI

FOR BUSES:  NANDA TOURS AND TRAVELS , NEW DELHI

D. OFFICE SIZE The total land area available = 300 square meter Out of which the covered area = 100 square meter. And, free space=200 square meter. (for parking cars)
ROOMS OFFICE ACCOUNTS STORE (FOR SPARE PARTS, ETC) RESTROOM, DRINKING WATER Total AREA (square meter) 50 10 20 20 100

E. OFFICE LOCATION Our office is located in Kanti Nagar in Shahadra , New Delhi. The raw material will be made available mainly from best spare parts providers in Delhi. Raw material will be ordered from the local parts provider in case of urgency while from the respective service stations when high quality part is required.

F. ESTIMATE OF LABOUR REQUIREMENT
Providing car rentals requires high amount of driving skills on the part of driver and also requires good amount of visual power. The cars that are used in providing the service are also not fully automatic and require human efforts to perform the required operation. The estimated amount of labour requirement is:

Type Manager Deputy Manager Drivers Other clerical staff

NO. 2 1 10 1

SALARY 20000 5000 40000 4000

G. ESTIMATE OF CARS TO BE USED
Type Indica Tavera Ambassador Esteem No 4 2 2 2 Price 350000 550000 250000 400000 Total 1400000 1100000 500000 800000 3800000

A. MARKET DESCRIPTION This industry comprises establishments primarily engaged in furnishing travel information and arranging tours, transportation, rental cars, and lodging for travelers. Travel agents have been significantly affected by two factors in the early 2000s. First, travelers are increasingly using the Internet to book their travel, bypassing traditional agents. Second, the terrorist attacks of September 11, 2001 brought all travel—both business and leisure—within the United States to a screeching halt. In the aftermath of the attacks, security concerns and a depressed economy left agents with few customers. Just as travel agents were looking for consumers to regain confidence in the safety of travel and as the economy showed the first signs of recovery, the United States entered into the Second Persian Gulf War in early 2003, once again leaving Americans feeling the need to stay close to home. Although experts agree that the economy as well as the travel industry will eventually rebound, even if consumers overcome their cautionary feelings regarding air travel, the future role of travel agents is made murky by the every-growing use of the Internet to plan and book travel arrangements. Agents will also have to deal with less-than-perfect relations with airlines, cruises, and tour groups—all of whom are themselves struggling to stay afloat.

B. DISTRIBUTION CHANNELS Distribution channels are different types and and we may adopt any one type a combination of or all the types of the distribution channels. All this depends on the type of services being provided by the us. The levels of channels will be: 1) Single level channel : here the service would be directly distributed to the consumers. 2) One level channel: it implies a single where only type or category of middlemen is used. For example we may use the service of our support agencies for other cars and buses. There is only one intermediary between the service supplier and the service user: The following diagram gives the various options for using one level channel:
Travel Agent Supporting Agent Tour operator Corporate Travel Department

SERVICE SUPPLIERS

SERVICE USERS

C. SELECTION OF CHANNELS AND INTERMEDIARIES Channel decision involves long term commitment and cost for the principal suppliers. In this regard the time and cost are highest as compared to any other marketing decision. Thus level of channels’ selection and selection of intermediaries are a very critical to the success of an enterprise. The following factors play important role in these decisions:  Access to end user,  Prevailing distribution practices,  Revenue : Cost Analysis,  Degree of control desired,


Availability of channel participants,

 Capability of channel participant,  Geographical coverage desired,  Market standing of the channel participant, and  Financial status of the channel participant, etc. Level of channels, selection of channel member’s etc. can give results only when smooth and professional relation with intermediates are developed and maintained. For example the percentage of commissions or royalties mode of payment, credit time etc. are decide at the initial stage it self. It is also advisable to have contracts agreements signed in this regard. “The decision to use middle man involves the organisation in a number of further decisions. The first is the problem of choosing the best middleman from the large number who are available.. but might find that a desired distributor id not willing to accept the assignment. Or the distributor might handle the product only if given exclusive distribution. Or the distributor might handle the product only if it receives better financial terms than are being offered… the organisation must follow this up by carefully establishing the terms and responsibilities of the distributors.

D. MAJOR CONSUMERS Our major consumer would be the office goers who are working in BPOs, IT and Software companies. We would have an agreement with the company the sample of contract is given at the end of the report. Other consumers would be the normal public who use car rental services for going out with their families for outstation trips, etc. E. COMMERCIAL VEHICLES IN INDIA All motorised road vehicles are tagged with a licence number in India. The licence plate number is issued by the district-level Regional Transport Office (RTO) of respective states - the main authority on road matters. The licence plates are placed in the front and back of the vehicle. By law, all plates are based on the Arabic (European) script, though many states violate this by writing the numerals in the local script. Other guidelines include having the plate lit up at night and the restriction of the fonts that could be used. In some states such as Sikkim, cars bearing outside plates are barred from entering restricted areas. Commercial vehicles such as taxis and trucks have a yellow background and black text (e.g., DL 1Y 1985). Vehicles belonging to foreign consulates also have the same yellow and black colouring.. All new motorised road vehicles that come into the market have to adhere to the new plates, while existing vehicles have been given two years to comply. Features incorporated include the number plate having a patented chromium hologram; a laser numbering containing the alpha-numeric identification of both the testing agency and manufacturers and a retro-reflective film bearing a verification inscription "India" at a 45-degree inclination. The numbers would be embossed on the plate, rather than being painted for better visibility. The term "India" is to be in a light shade of blue.

F. PERMITS FOR PASSENGER VEHICLES Taxi permits: Such permits are issued by MLO (AR) Burari for carrying passengers to various places within Delhi. Fare is charged as per the fare meter mounted on such Vehicles & as determined by STA. Prevailing fares are as under:a) Taxi-Rs.15.00 for first kilometer and thereafter Rs.5.00 for every additional kilometer. b) Maxicabs: Such permit are issued by STA to vehicles carrying passengers to various parts of Delhi on a fixed route and as per the fare fixed by the STA. Total seating capacity of such vehicles should not exceed more than 12 excluding the Driver. TEMPORARY PERMITS : A temporary permit is issued by STA under Section 87 of Motor Vehicles Act, 1988 to transport vehicle for a limited period, enabling the vehicle to go out side Delhi for the following reasons:a) For the conveyance of passengers on special occasions such as to and from fairs and religious gatherings, or b) For the purposes of a seasonal business, or c) To meet a particular temporary need, or d) Pending decision on an application for the renewal of a permit. The applicant has to apply on form P. TEMP. A. DLY/DLZ (ALL India Tourist Permits cab): This permit is given for motor cabs having seating capacity of five. The colour of the cabs are permitted as white only. The applicant for this permit should have an office having telephone at suitable tourist passengers booking place .The applicant should have authorised parking place to park these vehicles and adequate financial resources to purchase the vehicle. The road tax\passenger tax of vehicle is paid at state borders. DLZ permits are given to luxury cars.

ALL INDIA TOURIST PERMIT (AITP): This permit is given to luxury buses which have white colour with a blue ribbon of five centimeters width at the center of exterior of the body and the word “Tourist” shall be inserted on two sides of the vehicle within a circle of sixty centimeters diameter. A tourist permit shall be deemed to be invalid from the date on which the motor vehicle covered by the permit completes 9 years in the case of Motor Cab and 8 years where the motor vehicle is other than a motor cab, unless the motor vehicle is replaced by another, the latter vehicle shall not be more than 2 years old on the date of such replacement. The seating layout shall be two and two or one and two or one and one on either side, all seats facing forwards. The Vehicles should also have other facilities like public address system, drinking water, push full back seats, fans, curtains, a separate driver cabin etc. The applicant has to apply on form 45 & 48 along with other formalities. G. EXISTING RATES WITHOUT AC /KM INDICA QUALIS INNOVA TAVERA TEMPO TRAVELLER 6.5 8 10 10 14 WITH AC/ KM 7.5 9 11 11 15

IN U.P THE TAX IS CHARGED ON PER DAY BASIS IN PUNJAB ALSO THE TAX IS CHARGED ON PER DAY BASIS IN HARYANA THE TAX IS CHARGED ON PER KM BASIS IN H.P THE TAX IS CHARGED ON PER KM BASIS

CASE ANALYSIS OF BPO INDUSTRY Inefficient vehicle routing, ambiguity over transportation bills, rising transportation costs, real-time control of vehicles, and pressure to increase call engagement is affecting the bottom-line of BPO outfits. One solution they are looking at: vehicle routing optimisation software. The biggest challenge for BPO is how to arrange the pickup and drop of 4,500 employees who work in 48 shifts in a day. After HR and telecom, transportation is the third-largest expense head in a BPO outfit, amounting to 17 percent of total expenses and directly impacting its revenues. Additionally, a cab carrying four to five employees that reports 30 minutes late for duty costs the company $184 (at the rate of $80 per hour). Factors such as accuracy of employee pickup and drop, on time reporting and safety of employees ought to be measured by BPOs as they directly affect the bottomline. For example, the accuracy of employee pickup and vehicles reaching on time should be 97 percent. Wrong pickups directly affect revenues. • Hughes BPO Services prepares a roster (route plan) based on the employees’ locations that are given to the driver. This process gets further complicated if an agent falls ill, for then an immediate arrangement has to be made to pick up another employee as a replacement. Now consider this: a call centre is expecting calls to peak at 7 pm because its client has advertised a new scheme in the papers, and instead of 100 they need 150 agents to handle the call engagement. An automated vehicle route optimisation solution completely automates the entire roster plan, then maps the shortest route the vehicles can take. • Cab utilisation ratio Cab (vehicle) utilisation was poor in most BPOs because they have manual vehicle routing systems in place. In an 8seater cab, the occupancy was found to be in the range of 2-3 people, leading to high running costs—Rs 4,000-6,000 per employee per month. Sharma says, “Ideally, the cab utilisation rate has to be in the range of 4-5 per cab. BPO firms should look at investing in a vehicle route optimisation solution if their cab utilisation rate is less than four.

The routing should be such that there is maximum occupancy with minimum travel time. Optimise that route The vehicle route optimisation solution market has come into its own. It is a Rs 2 crore market, with companies such as Wipro Spectramind, Converges, Dell, Vertex, Hughes and American Express using these solutions. At present over 450 BPOs/call centres are operating across the country and over half a million employees are working in this sector. As nearly 30,000 to 35,000 vehicles are plying on Indian roads to meet requirements of this sector, transportation is the third major expense area of the BPOs.

SAMPLE CONTRACT To, M/s Subject:- Hiring of DLY Cars . Sealed rate quotations are invited for hiring of DLY Cars (as per list enclosed). If you are interested to undertake the contract on the terms and conditions specified in para 5 below, you are requested to send you quotations in sealed cover marked ‘quotations for hiring of DLY Cars. The sealed cover containing the quotations should be addressed to the undersigned by the name and sent to Room No. 910, Paryavaran Bhavan, CGO Complex, Lodi Road, New Delhi – 110003. 2. The quotations should be accompanied with an earnest money Rs. 10,000/- (Rupees ten thousand only) in the form of demand draft of any nationalized bank drawn in favour of the Pay & Accounts Officer, Company of Environment and Forests, New Delhi – 110003 without which the quotations will not be considered . No over-writing is allowed in the quotations. 3. The quotations will be accepted up to 3.00 p.m. on 5.9.2005 and the same will be opened at 3.30 p.m. on the same day at R.No. 910, Paryavaran Bhavan, CGO Complex, Lodi Road, New Delhi – 110 003. An authorized representative of your firm can remain present at the time of opening of quotations. Terms and conditions :(i) The firm bill have to provide nos. of DLY Cars and models as per requirements of the Company for which for quotations are accepted by the Company. (ii) In case the firm fail to provide of DLY Cars on a particular day on, the vehicle will be hired by the Company from the open market from authorised services taxi stand, the difference between the rate of the firms accepted by the Company and the market rate on which the vehicle is hired from the authorised taxi stand will be recovered/adjusted from the bills of the firm due for payment by the Company .

(iii) In case of default on the part of the firm to provide requisite number of cars for more than ten occasions during the contract period, the contract will be terminated and awarded to another firm at the risk and cost of the defaulting firm. (iv) For out station duty the vehicle will have provided at the short notice by the firms (v) The successful tenderer will be required to furnish a security deposit of Rs. 10,000/- (Rs. ten thousand only) within 10 days from the date of acceptance of his tender. The security deposit shall be in the for of fixed deposit, receipt drawn on any nationalized bank in favour of Pay & Accounts Officer, Company of Environment & Forests, New Delhi – 110003. The security deposit shall be refundable after the successful completion of the contract. (vi) The car would be insured in all respects by the firm. In case of any accident or theft etc. all the claims arising out of it will be met by the Agency and this Company shall not be liable in any matter whatsoever (vii) The car with the Driver would be placed at the disposal of this Company as and when required. This Company would be free to use the hired taxi in any manner for carrying officials. (viii) In case the car provided to this Company breaks down or arrive late, during the period of hire, the firm will immediately replace it with another car. In case firm fail to make arrangements, Company will hire car from market and actual expenses incurred on this account by Company, will be deducted from the subsequent bill of the firm. (ix) In case DLY Car do not report in time, a penalty of Rs. 1000/- per day (8 hrs) per car will be levied on the agency which will be deducted from the subsequent bill. (x) DLY Taxis are in good working condition. The firm will keep the car in neat and the seat covers should be in immaculate condition. (xi) The DLY Taxis should not be more than two years old in respect of Diesel and three year old in respect of the petrol. (xii) The firm should have at least two fixed telephone lines at office operational 24 hours and all drivers should be equipped with mobile telephone facilities for proper communication.

(xiii) The decision of the Company shall be final and binding on the firm. The Company also reserves the right to reject any quotation in full or in part without assigning any reasons thereof. (xiv) No dead mileage will be permitted. The meter reading would start from Paryavaran Bhavan. (xv) There should not be change in deployment of DLY Taxi and driver without prior permission of the Competent Authority in the Company. In case the car/driver is changed without prior permission, no payment will be made for the same. (xvi) The Drivers of the DLY Taxi should be well conversant with the Delhi routes. (xvii) DLY Taxi should comply all pollution control regulations and norms. (xviii) Firm should meet all statuary requirements like minimum wages, etc. Income –Tax, Service Tax, etc. Documents in this regard may be enclosed with the quotation. The HOD, MOEF reserves the right to reject any or all the tender without assigning any reasons thereof. (_________________) Transport Head

CONCLUSION
Providing Car Rental Services is a feasible project and has scope for growth. The key factors that support this statement are: • • The profit margins are quite promising The company is capable of repaying its loan within five year of time period and has a good potential of further expansion and diversification.

FINANCIALS
Total cost of the project
A. Capital cost of the project B. Working capital requirement Total (A+B)

5912000 228200 6140200

Means of Finance
1. Own capital 2. Long term loan For land & building Cars 3. Short term loan Working capital loan Total (1+2+3)
2012000

2000000 1900000

228200 6140200

Capital cost of the project
A. Land, building & its developments B. Cars C. Other fixed assets D. Preliminaries & preoperative expenses Total (A+B+C+D) 2000000 3800000 107000 5000
5912000

Working capital requirement
A. Raw material Qty 1. Grease, Coolant , Engine Oil 2. Car Tracer 3. FM Music Player 4. Ink Catridge TOTAL (1+2+3+4) B. Salaries & wages/Month 1. Manager 2. Deputy Manager 3. Clerical Staff 4. Drivers No.
2

Rs/Unit 200 1500 300 1000

Rs 2200 15000 3000 1000
21200

11 10 10 1

Rs.
10000 20000 5000 4000 40000

1 1 10 14

5000 4000 4000

TOTAL (1+2+3+4) C. Utilities & Overheads 1. Power Consumption

69000

15000

2. Stationery, postage, telephone, etc. 3. Repairs & maintenance 4. Traveling & conveyance exp TOTAL (1+2+3+4)

15000 3000 2000
35000

TOTAL (A+B+C)
Margin money for working capital money Working capital for 1 year

125200
103000 228200

Land, building & its develpoment
Land & Building 300 sq. mtrs. @ Rs.4,000 per sq. mtr Development Construction Total 1200000 800000 2000000

Cars
No. Indica Tavera Ambassador Esteem 4 2 2 2 Rate 350000 550000 250000 400000 Total 1400000 1100000 500000 800000

Total

3800000

Other Fixed Assets
Computer with printer Office Tables Computer Table Executive chairs Visitors Chairs Almirahs & Cabinets Installation Cost of Phone Electrical, lighting, etc. Internet Total 1 2 1 2 4 3 25 40000 6000 1000 3000 1250 10000 2000 400 1000 40000 12000 1000 6000 5000 30000 2000 10000
1000

107000

Income Statement 1st year Income Sales revenue Expenditure Raw Materials Salaries & wages Power & fuel Repairs & maintenance Traveling expenses Stationery, telephone, postage etc. Miscellaneous expenses Interest on Long term loan Payment to bank 254400 828000 180000 36000 432480 910800 180000 36000 778464 1001880 180000 36000 1479082 1102068 180000 36000 2958164 1212275 180000 36000 3800000 4400000 4800000 5400000 6500000 2nd year
3rd year

4th year

5th year

24000 180000 12000 660512 825640

24480 180000 12000 528409.6 825640

25704 180000 12000 396307.2 825640

26989 180000 12000 264204.8 825640

28338 180000 12000 132102.4 825640

Depreciation on Cars @ 15% Depreciation on F & F @ 10% Depriciation on Land and Building @ 5%

570000 10700

484500 9630

411825 8667

350051.3 7800.3

297543.6 7020.27

100000 3681252

95000

90250

85737.5 4549572.

81450.63 5950533.

3718940

3946737.

2 Net profit/loss 118748 681060.4 853262.8 255978.8 4 597283.9 6

9 850427.1 255128.1 3 595298.9 7

9 549466.1 164839.8 3 384626.2 7

Less: Income tax

0

204318.1

Profit after tax

118748

476742.3

Calculation of cost of salaries and wages
Nature of staff Nos. Average salary Amount (Rs.) Annual salary Amount (Rs.) 1st year 20000 5000 40000 4000 2nd year 22000 5500 44000 4400

Manager Deputy Manager Drivers Clerical Staff

2 1 10 1

10000 5000 4000 4000

3rd year 24200 6050 48400 4840

4th year 26620 6655 53240 5324

5th year 29282 7320.5 58564 5856.4

Total

69000 828000

75900 910800

83490 100188 0

91839 110206 8

101023 121227 5

Assumption: Increase in salary @ 10% per year as compared to previous year

Calculation of interest on long term loans

1st year

2nd year 3rd year

4th year

5th year

For Land & building Interest @ 16%

200000 0 320000

160000 0 256000

120000 0 192000

800000 128000

400000 64000

For Cars Interest @ 16%

190000 0 304000

152000 0 243200

114000 0 182400

760000 121600

380000 60800

For WCR Interest @ 16% Total

228200 36512 660512

182560 29209.6 528409.6

136920 21907.2 396307.2

91280 14604.8 264204.8

45640 7302.4 132102.4

Repayment schedule long term loan Year For Land & building Loan outstanding Repayment Amount Balance 160000 0 120000 0 800000 400000 0

1 2000000 2 1600000 3 1200000 4 800000 5 400000

400000 400000 400000 400000 400000

For Cars

1 1900000 2 1520000 3 1140000 4 760000 5 380000

380000 380000 380000 380000 380000

152000 0 114000 0 760000 380000 0

For WCR

1 2

228200 182560

45640 45640

182560 136920

3 4 5

136920 91280 45640

45640 45640 45640

91280 45640 0

Assumption: Long term loan payable in 5 years

Calculation of depreciation on assets 1st Year
A. Land & Building Balance Less: Depreciation @5% 2000000 100000 1900000 1900000 95000 1805000 1805000 90250 1714750 1714750 85737.5 1629013 1629013 81450.6 3 1547562

2nd Year

3rd Year

4th Year

5th Year

B. Cars

Balanc e Less: Depreciation @15%

380000 0 570000 323000 0

323000 0
484500

274550 0
411825

233367 5
350051. 3

198362 4
297543. 6

274550 0

233367 5

198362 4

168608 0

C. Furnitur & Fixtures

Balanc e

107000

96300

86670

78003 70202.7

Less: Depreciation @10%

10700 96300

9630

8667

7800.3

7020.27

86670

78003 70202.7 63182.4
443589. 1 386014. 5

Total (A+B+C)

680700

589130

510742

Cash Flow Statement 1st 1.) cash flow from operating activites Net profit before tax ADD: Depreciation Interest on loan paid Operating profit before WCR LESS: Increase in stock Cash generated from operations LESS:Income tax paid Net cash from operating activities 2.) Cash flow from Investing activites Purchase of land & building Purchase of cars Purchase of funiture & fixtures Net cash from Investing activities 3.) Cash flow from financing activites Proceeds from owners capital Proceeds from long term loan Proceeds from short term loan repayment of loan 2000000 3800000 -107000 5907000
0 0 0 0 0 0 0 0 0 2nd 3rd 853262.8 510742 4th 850427.1 443589

5

118748 681060.4 680700 589130 660512 528409.6 1459960 1798600 -21200 -21200 1438760 1777400 0 -204318 1438760 1573082

396307.2 1760312 -21200 1739112
-255979

1483133

264204.8 1558221 -21200 1537021 -255128 1281893

0

0

0

2012000 3900000 228200 -825640

0 0 0

0 0 0

0 0 0

-825640

-825640

-825640

Net cash from financing activities Net increase in cash (1+2+3)

5314560 846320

-825640 747442

-825640 657493

-825640 456252.9

ADD: Cash Equivalents at the beginning of the year Projected Balance Sheet for

3800000 4646320

4400000 5147442

4800000 5457493

5400000 5856252.9

Source of Fund 1st Capital Owners Capital Secured Loan LongTerm Loan Short Term Loan Current Liabilities Profit Interest on loan Accounts Payable 2012000 3120000 182560 118748 660512 0 6093820 Application of Fund Fixed Assets Land & building Cars Other Fixed assets Current Assets cash Inventory Accounts Receivable 1900000 3230000 96300 846320 21200 0
1805000 2745500 86670 747442

2nd

3rd

4th 201200 0 780000 45640
595299 264205

5th 201200 0 0 0 384627
132102 845198

2012000 2340000 136920 476742
528410

2012000 1560000 91280
597284 396307 148250

0 5494072

4805121

463150 416092 4

337392 7

1714750
2333675 78003 657493

1629013 1983624 70202.7 456254

154756 2
1686080 63182.4 55903

21200
88260

21200
0

21200
0

21200
0

6093820

5494072

4805121

416029 4

337392 7

Return on Investment (R.O.I)

Promoter's Equity Term Loan A Net Profit After Tax Interest Paid to Bank B

2012000 4128200 6140200 118748 660512 779260

2012000 3302560 5314560 476742 528410 1005152

2012000 2476920 4488920 597284 396307 993591

2012000 1651280 3663280 595299 264205 859504

2012000 825640 2837640 384627 132102 516729

ROI (B/A) in %

12.69112

18.91317

22.1343

23.46269

18.20982

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