INTRODUCTION
A plumbing business provides general maintenance and repair services to residential and commercial customers, including plumbing and appliance installation and repair. Workers in this industry install and maintain plumbing fixtures, fittings, and equipment and the industry activities include work on household pipes and drains; installation of appliances, and work on bathroom and toilet fixtures and venting systems. Emergency repair work (e.g. unclogging drains or repairing burst water mains) constitutes 40% of the work of a plumbing enterprise and is a significant source of revenue. With growing urbanization in India, the demand for plumbers is also growing.
MARKET POTENTIAL
The plumbing industry’s size is directly proportionate to the construction industry’s size. It accounts for 7.5 percent to 15% of the construction industry’s total size. The manpower requirement for the plumbing industry is about 2.5% of the manpower requirement in the construction industry. Currently, 33 million people are employed in the construction industry. Hence, around 0.8 million people are currently employed in the plumbing sector. About 90% of the plumbing industry workforce in India is not professionally trained. Most of the skill learning in the industry happens through unstructured, Job Training (OJT).
FUNDING SOURCE
Under the support programme by Development Alternatives Group, such enterprises have availed government support through the National Rural Livelihoods Mission, with an average loan size of INR 30,000.
BUSINESS ECONOMICS
FIXED CAPITAL (One Time Expenditure)
| MACHINERY & EQUIPMENT | AMOUNT (in INR) |
| Tool Kit | 45,000 |
| Measuring tape | 200 |
| TOTAL | 45,200 |
WORKING CAPITAL (for a 2-month cycle)
| RAW MATERIAL | AMOUNT (in INR) |
| 10m Teflon Plumbing Tape (10 units @ INR 8/unit) | 80 |
| STAFF AND LABOUR | AMOUNT (in INR) |
| Entrepreneur’s Salary (@ INR 10,000/month) | 20,000 |
| UTILITIES & OTHER EXPENSES | AMOUNT (in INR) |
| Transportation Cost | 500 |
| Stationary | 1,000 |
| TOTAL | 24,080 |
FINANCIAL SUMMARY (Annual)
| FINANCIALS | AMOUNT (in INR) |
| Fixed Cost | 45,200 |
| Working Capital (for each cycle of 2 months duration) | 24,080 |
| Total Enterprise Cost | 69,280 |
| Annual Revenue | 1,80,000 |
| Total Expenditure (annual working capital) | 1,44,480 |
| Enterprise Profit | 35,520 |
| Payback Period (in months) | 15 |
BASIC ASSUMPTIONS
- Working days in a month: 26 days
- Working shift of 8 hours per day
- Parts bought as per job orders and specifications
- Monthly projects: 50 projects with entrepreneur’s commission as INR 300/job
- Bank loan not taken into account
Note: All figures mentioned are indicative and for reference purpose only. Development Alternatives Group bears no liability for accuracy. For any further information, please contact Development Alternatives on +91-11-2654-4100 or +91-11-2654-4200.
Star Entrepreneur
Ravi Kushwaha from Orchha set up his enterprise in 2020. He invested INR 30,000 of his own savings and a further INR 20,000 was loaned to him by his parents in setting up.
- Monthly income at INR 15,000
- Employees 3 other people