SECTION 7

THE PRODUCTION
OR
OPERATION PLAN
 7.1 PROCESS FLOW CHART
Figure below shows the process flow chart for the pepper spray production. Each of the
process need to be done accordingly the flow chart shown.

List up all the raw materials needed from the supplier

Obtain the raw materials from the supplier

Verify and note all the raw materials costing

Process start by mixing all the raw materials until the product is
done

Production done and process delayed before transferred to

storage tank

The product from storage tank being transferred for QA and QC

Inspection for the quality and quantity of product

The product being pack into a large packaging

Verify and confirm job done

Product being stored in the storage tank

The product is ready to be delivered and sold

 7.1.1 PROCESS FLOW DESCRIPTION

Step 1: Ensure that all the raw materials are presence and the equipment is safe to be used.

Step 2: Mix the mineral oil, vinegar, black pepper powder and white pepper powder into the
mixing tank.

Step 3: The mixture is being mixed equally until all the solute turn into solutions.

Step 4: The solution then will undergo the filtration process in the filter tank. This is to
remove any impurities that still presence inside the solutions. Basically, this process
takes time about 3 hours.

Step 5: The solution that had been filtered will transferred inside the pepper spray bottle.

Step 6: The product will undergo the QA and QC inspection before being transferred into the
storage tank which is boxes.

Step 7: The product is readily to be delivered and sold.

 7.2 UNIT OUTPUT/HOURS OF OPERATION

Output unit is the total units of production that can be provided per month. Calculation below
show the amount of output that can be obtained by ensuring the 5 units of product achieved
within 1 hour.

8 𝑢𝑛𝑖𝑡𝑠 12 ℎ𝑜𝑢𝑟𝑠 23 𝑑𝑎𝑦𝑠

= X X
ℎ𝑜𝑢𝑟𝑠 1 𝑑𝑎𝑦 1 𝑚𝑜𝑛𝑡ℎ

= 2208 units/month

 Production unit per day

Day/month Output unit

1 day 60 units
1 month 1380 units

 Operation service hours

Day/month Service hours

I days operation 12 hours
1 month 276 urs

 Schedule of operation

Time Activities
1000am-1200pm Preparation process
1400pm-1800pm Production process
2000pm-2200pm Packaging process
 7.3 MATERIAL REQUIREMENTS

PRICE PER UNIT TOTAL

QUANTITY
ITEMS (RM) PURCHASE
REQUIRED
(RM)

Mineral oil 831.60 1 boxes 831.60

Vinegar 83.16 10 boxes 831.60
Black pepper powder 25.36 10 kg 253.60
White pepper powder 39.92 10 kg 399.20
TOTAL 2316.00
 7.4 LIST OF DIRECT WORKER

7.4.1 List of operational personnel

Position Number of Personnel
Chairman 1
Executive Secretary 1
Administrative Officer 1
Marketing Officer 1
Operations Officer 1
Finance Officer 1
7.4.2 SCHEDULE OF TASKS AND RESPONSIBILITIES
Position Task and Responsibilities
Chairman  To promote and oversee the highest standards of the
company.
 Ensuring that all workers enabled to play a full and
constructive part in the development and determination of
the company's strategy and overall commercial
objectives.
 Demonstrate ethical leadership.
 Ensuring that the development of the company's business
and the protection of the reputation of the company.
Executive Secretary  To ensure that business of the company is conducted in
accordance with its objects as contained in its
memorandum of association.
 To prepare the agenda in consultation with the chairman
and the other documents for all the meetings.
 To ensure that affairs of the company are managed in
accordance with its objects contained in the articles of
association and the provisions of the company law.
Administrative Officer  Manage office supplies stock and place orders.
 Maintain and update company databases.
 Answer queries by employees and clients.
 Update office policies as needed.
 Maintain a company calendar and schedule appointments.
Marketing Officer  Prepare and manage the project publication and
distribution of publicity materials.
 Undertake market research and establish the best way to
reach target groups.
 Write, edit and proofread marketing material for use in
different channels.
 Coordinate with outside agencies, for example designers,
to produce marketing material such as stationery and web
 pages.
 Analyze the impact of marketing campaigns and prepare
measurement reports.
Operations Officer  Oversee and direct daily company administrative
processes and procedures.
 Ensure company policies align with and advance business
objectives.
 Strategically map-out, plan, and manage projects.
 Develop improved business functionality that increases
profits.
 Ensure compliance with best business practices
throughout organization.
 Implement improved operational measures and policies
that promote efficiency.
Finance Officer  Keep accurate records for all daily transactions.
 Prepare balance sheets and process invoices.
 Record accounts payable and accounts receivable.
 Update internal systems with financial data.
 Prepare monthly, quarterly and annual financial reports.
 7.4.3 SCHEDULE OF REMUNERATION

Position No. Monthly EPF SOCSO Amount

Salary Contribution (2%) (RM)
(RM) (12%) (RM)
(RM)
Chairman 1 3500 420 70 3990
Executive Secretary 1 2500 300 50 2850
Administrative 1 1800 216 36 2052
Officer
Marketing Officer 1 1800 216 36 2052
Operations Officer 1 1800 216 36 2052
Finance Officer 1 1800 216 36 2052
Total 13,200 1,584 264 15,048
 7.5 LIST OF MACHINE AND EQUIPMENT
Table below show the type of equipment that had been used in order to produce our pepper
spray in a good condition and best quality. Basically, before the operation being start up, a
regular maintenance checklist will be conducted.

Price per unit Quantity Total purchase

Type
(RM) Required (RM)
Mixing tank

RM5,613.30 2 RM11,226.60

Filter tank

RM28,690.20 2 RM5,7380.00

Conveyor

RM2,079.00 1 RM2,079.00

Total RM70,685.60
 7.6 PLANT OR OFFICE LAYOUT

SHOWCASE ROOM

MEETING ROOM

S
PRODUCTION T
O
R
AREA A
G
E
R
O
O
M
 7.7 LOCATION
Basically, our business operation section site is located in Taman Bandar Baru Simpang
Empat, Simpang Ampat, Alor Gajah, Melaka. The building had been rent for our business.
The reasons why we rented out this area as our operational section for our business is because
we can obtain the raw material nearby which is at Aura Persona. Aura Persona is one of the
shops that provided many such things that related to chemical production.

Address: TN64, 64-1, Jalan BBSE 3, Bandar Baru Simpang Ampat, 78000,
Simpang Ampat, Alor Gajah, Melaka
 7.8 SCHEDULE OF OPERATION
The schedule of operation is being explained by using the Gantt chart below. Each of the
activities should be conducted based on the schedule that had been provided to avoid any
necessary accident that might occur.

900 1000 1200 1400 1800 2000

(AM) (AM) (PM) (PM) (PM) (PM)
ACTIVITIES - - - - - -
10.00 1200 1400 1800 2000 2200
(AM) (PM) (PM) (PM) (PM) (PM)

Inspection of the equipment used

(Regular maintenance checklist)

Preparation process

Break

Operation process

Break

Packaging and delivered

 7.9 OPERATION OVERHEAD
Overhead costing consists of the cost that indirectly associated with the manufacture of
finished product. The cost also may be the costs that cannot be classified as direct materials
of direct labour.

FOR THE END YEAR OF DECEMBER 31, 2017

Budgeted production = 25000 units

Indirect materials = RM18000

Indirect labour = RM42,000

Supervisory salaries = RM180,000

Rent = RM30,000

Utilities = RM600

Depreciation = RM2400

Total overhead RM273,000

 7.10 THE PRODUCTION BUDGET
Table below show the total cost of production budget which including the machine and
equipment, factory renovation, raw materials, EPF and SOCSO, utilities, building rent,
deposit for rent and deposit for utilities.

Fixed assets Monthly Expenses Other expenses

Items
(RM) (RM) (RM)
Machine and
70,685.60
Equipment
Factory
3,000
Renovation
Raw materials 2316
EPF + SOCSO 1,848
Utilities 500
Building rent 2,500
Deposit for rent 2500
Deposit for
500
utilities
TOTAL 76001.60 4848 3000