Está en la página 1de 16

185.

PROFILE ON PRODUCTION OF DETERGENT POWDER

185-2

TABLE OF CONTENTS

PAGE

I.

SUMMARY

185-3

II.

PRODUCT DESCRIPTION & APPLICATION

185-3

III.

MARKET STUDY AND PLANT CAPACITY A. MARKET STUDY B. PLANT CAPACITY & PRODUCTION PROGRAMME

185-4 185-4 185-6

IV.

MATERIALS AND INPUTS A. RAW & AUXILIARY MATERIALS B. UTILITIES

185-7 185-7 185-8

V.

TECHNOLOGY & ENGINEERING A. TECHNOLOGY B. ENGINEERING

185-8 185-8 185-10

VI.

MANPOWER & TRAINING REQUIREMENT A. MANPOWER REQUIREMENT B. TRAINING REQUIREMENT

185-11 185-11 185-11

VII.

FINANCIAL ANLYSIS A. TOTAL INITIAL INVESTMENT COST B. PRODUCTION COST C. FINANCIAL EVALUATION D. ECONOMIC BENEFITS

185-13 185-13 185-14 185-15 185-16

185-3

I.

SUMMARY

This profile envisages the establishment of a plant for the production of detergent powder with a capacity of 100 tonnes per annum.

The present demand for the proposed product is estimated at 2,726 tonnes per annum. The demand is expected to reach at 4,539 tonnes by the year 2020.

The plant will create employment opportunities for 51 persons.

The total investment requirement is estimated at Birr 15.06 million, out of which Birr 7.5 million is required for plant and machinery.

The project is financially viable with an internal rate of return (IRR) of 25 % and a net present value (NPV) of Birr 10.09 million discounted at 8.5%.

II.

PRODUCT DESCRIPTION AND APPLICATION

Detergents, term applied to materials, the solutions of which aid in the removal of dirt or other foreign matter from contaminated surfaces. A detergent powder is a product formulated from the constituents such as surfactants, which perform the primary cleaning and washing action by reducing the surface tension of water builders, which boost the cleaning power of the surfactant and other additives. Detergent powder is proved to be effective in hard water and cool or cold water, whereas soap is often wholly ineffective under both conditions. The major use of detergent powders is in households for washing clothes and utensils. They are suitable for hand washing and also for machine washing in laundries and dish washers.

185-4

III.

MARKET STUDY AND PLANT CAPACITY

A.

MARKET STUDY

1.

Past Supply and Present Demand

The countrys requirement for detergent powder has been met through domestic production and imports. However, data on domestic production of the product is not readily available. Since imports are considered as a proxy for demand gap (i.e. the gap between domestic production and domestic demand), import data is used to estimate the demand for detergent powder. The quantity of imports of detergent powder is depicted Table 3.1.

Table 3.1 IMPORTS OF DETERGENT POWDER

Year 2000 2001 2002 2003 2004 2005 2006 Average

Import (Tonnes) 3,843.31 5,946.48 4,143.1 623.06 2,630.29 2,508.65 3,039.32 3,247.74

Source: Customs Authority, External Trade Statistics.

185-5 As can be seen from Table 3.1, the quantity of imports fluctuated from year to year but, on the average, 3247.74 tonnes of detergent powder had been imported annually during the period 2000 2006. Due to the fluctuating nature of import the average of the last three years ( 2004 2006) is assumed to realsiticley reflect the current ( 2007) level of import or undtifed demaned for the product. Accordingly, the current demaned for the product is estimated at 2,726 tonnes.

2.

Projected Demand

The major factors that affect the demand for detergent powder include income and population growth. Accordingly, the demand for the product is projected by employing an average annual growth rate of 4%, which is equivalent to the growth rate of urban population. (See Table 3.2) Table 3.2 PROJECTED UNSATISFIED DEMAND FOR DETERGENT POWDER

Year

Projected Demand ( Tonnes)

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

2,835.1 2,948.5 3,066.5 3,189.1 3,316.7 3,449.4 3,587.3 3,730.8 3,880.1 4,035.3 4,196.7 4,364.6 4,539.1

185-6

3.

Pricing and Distribution

The average retail price of different brands of locally produced detergent powder is Birr 2 per 100 grams. Allowing margin for wholesalers and retailers margins, the estimated factory gate price of the product for the envisaged plant is set at Birr 1.50 per 100 grams or Birr 8.60 per kg.

The products of the envisaged plant can get its market outlet through the existing wholesale and retail network.

B.

PLANT CAPACITY AND PRODUCTION PROGRAMME

1.

Plant Capacity

A plant with annual capacity of 3000 tonnenes, of detergent powder per year is envisaged on the basis of a production schedule of 300 days per annum and three shifts of eight hours a day. The plant capacity is determined by considering the unsatisfied demand and economy of scale limitations. Based on the market study the envisaged plant will have annual production capacity of 100 tonnes. The plant will operate in a single shift of 8 hours a day, and for 300 days a year.

2.

Production Programme

The schedule is worked out considering the time required for gradual build up in labour productivity and fine tuning of machinery and market penetration period. Production will commence at 70%, and then will grow to 85% and 100% in the second year, and the third year and then after, respectively. below. Detail production programme is shown in Table 3.3

185-7 Table 3.3 PRODUCTION PROGRAMME Year Capacity utilization (%) Production (tonnes) IV. MATERIALS AND INPUTS 1 70 2,100 2 85 2,550 3-10 100 3,000

A.

RAW AND AUXILIARY MATERIALS

The major raw materials used to produce detergent powder are Alkyl benzene sulphonic acid, sodium tri polyphosphate, sodium sulphate, sodium silicate, and caustic soda. Caustic soda can be obtained locally while the other raw materials are supposed to be imported from foreign sources. How ever, there is a possibility to manufacture sodium sulphate and sodium silicate locally as the starting materials for these chemicals are locally available. Auxiliary material, printed polyethylene is necessary as packing materials. Annual consumption of

raw and auxiliary materials at full production capacity and their corresponding cost is given in Table 4.1 below. The total cost of raw material is estimated at Birr 45,024240. Table 4.1 RAW AND AUXILIARY MATERIALS REQUIREMENT AND COST Sr. No. 1 2 3 4 5 Description Alkyl benzene sulphonic acid Sodium tripolyphosphate Sodium sulphate Sodium silicate Caustic soda Printed polyethylene (250g det. Powder) Grand Total bags, Qty 720 900 540 660 120
12 million

Unit Price 22,968 19,920 2,280 11,364 5,232 0.1

Cost, [Birr] LC 2,480,544 2,689,200 184,680 1,125,036 627,840 1,200,000 8,307,300 FC 14,056,416 15,238,800 1,046,520 6,375,204 TC 16,536,960 17,928,000 1,231,200 7,500,240 627,840

1,200,000 36,716,940 45,024240

185-8

B.

UTILITIES

Electricity, water and fuel oil are the utilities required by the envisaged plant. Detailed requirement and costs of utilities are shown in Table 4.2. The total cost of utilities is estimated at birr 645,160.

Table 4.2 UTILITIES REQUIREMENT AND COST

Sr. No. 1 2 3

Description

Quantity

Unit Price (Birr)

Total Cost, Birr 47,360 165,000 432,800 645,160

Electricity (kWh) Water (m3) Furnace oil (lt.) Grand Total

100,000 30,000 80,000

0.4736 5.50 5.41

V.

TECHNOLOGY AND ENGINEERING

A.

TECHNOLOGY

1.

Production Process

Standard detergent powder manufacturing plant consists of mixing, drying, after drying, packing and antipollution units. These units are briefly described as follows:

Mixing unit: - Alkyl benzene sulphonic acid is neutralized and mixed with builders such as sodium tri polyphosphate, sodium silicate, sodium sulphate and other minor ingredients. This detergent slurry is transferred to the top of the spray drying tower by high pressure pump.

185-9 Drying unit: - The mixed slurry is sprayed from the nozzles at the top of the drying tower. The sprayed detergent slurry is dried by hot air coming from the furnace. The dried detergent powder is taken out at the bottom of the tower, and is transferred to the sieve by belt conveyor and air lift equipment.

After drying unit: - Fine shaped detergent powder is screened by the sieve and stocked in baggies after being perfumed.

Packing unit: - The final product is packed here. Detergent powder is fed into the packing machine from baggies.

Anti pollution unit: - Dust contained in the exhaust air, is washed and separated by the spraying system. This water, containing detergent dust is recycled to the mixing unit again.

2.

Source of Technology

The technology of detergent powder production can easily be purchased from India. Addresses of machinery suppliers are given below:1. Micro Machines Limited of India Tel: 91 281 368564 Fax: 91 281 366010

2. Comp Engineering and Exports 3025/8, shreenidhi chambers, senapati Bapat Road, pune Maharashtra 411016(India) Tel: + (91)-(20)-25658205/06 Fax: + (91)-(20)-25658204 E-mail: mailto:sales@compengg.com,mcpaid@indiamart.com?subject=Comp

Engineering and Exports Mail Through compdetergentplants.com

185-10

B.

ENGINEERING

1.

Machinery and Equipment

The list of machinery and equipment required by the envisaged plant is given in Table 5.1 below. The total cost of machinery and equipment with the envisaged capacity is estimated at Birr 7.5 million, out of which birr 6 million is required in foreign currency.

Table 5.1 MACHINERY AND EQUIPMENT REQUIREMENT

Sr. No. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 Description Caustic soda solution tank Alkyl benzene sulphonic acid tank Neutralizer Sodium silicate tank Mixing vessel High pressure tank Pumps Furnace Blowers Spray drying tower Cyclone Conveyors Sieve Perfumer Baggies Packing machine Anti pollution unit

Qty. (No.) 1 1 1 1 1 1 Set 1 Set 1 Set Set Set 1 Set 1 1

185-11

2.

Land, Building and Civil Works

The total land requirement, including provision for open space is 3000 m2, of which 1,500 m2 will be covered by building. Estimating unit building construction cost of Birr 2,300 per m2, the total cost of building will be Birr 3.45 million. The cost of land leasing is Birr 0.15 per m2, and for 80 years land holding will be Birr 36,000. Thus, the total investment cost of land, building and civil works will be Birr 3.486 million.

3.

Proposed Location

Detergent powder manufacture is principally a market as well as raw material oriented project. Hence, the plant is proposed to be located at Butajira town, Meskan woreda.

VI.

MANPOWER AND TRAINING REQUIREMENT

A.

MANPOWER REQUIREMENT

The plant requires 51 workers, and their annual expenditure, including fringe benefits, is estimated at Birr 539,250. For details see Table 6.1.

B.

TRAINING REQUIREMENT

There is already sufficient experience in the country in manufacturing detergent powder. On site training programme is, therefore, believed to be adequate for key production, maintenance and quality control personnel by the experts of machinery and technology supplier during commissioning and performance testing period. The total cost of training is estimated at Birr 30,000.

185-12

Table 6.1 MANPOWER REQUIREMENT AND ANNUAL LABOUR COST

Sr. No.

Description

Req. No.

Salary, (Birr)

Monthly 1 2 3 4 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 Plant manager Secretary Production and technical manager Finance and administration manager Commercial manager Accountant Sales person Purchaser Clerk Quality control manager Chemist Production foreman Operator Mechanic Electrician Unskilled labor Driver Guard Cleaner Sub-total Employee benefit (25% BS) Total 1 2 1 1 1 2 1 1 2 1 3 3 9 3 3 10 2 3 2 51 2,000 1,800 1,800 1,800 1,600 2,400 1,200 1,200 900 1,600 2,700 2,700 5,400 1,800 1,800 3,500 600 750 400 35,950 8,987.5 44,937.5

Annual 24,000 21,600 21,600 21,600 19,200 28,800 14,400 14,400 10,800 19,200 32,400 32,400 64,800 21,600 21,600 42,000 7,200 9,000 4,800 431,400 107,850 539,250

185-13

VII.

FINANCIAL ANALYSIS

The financial analysis of the detergent powder project is based on the data presented in the previous chapters and the following assumptions:-

Construction period Source of finance

1 year 30 % equity 70 % loan

Tax holidays Bank interest Discount cash flow Accounts receivable Raw material local Raw material, import Work in progress Finished products Cash in hand Accounts payable

3 years 8% 8.5% 30 days 30days 90days 5 days 30 days 5 days 30 days

A.

TOTAL INITIAL INVESTMENT COST

The total investment cost of the project including working capital is estimated at Birr 15.06 million, of which 39 per cent will be required in foreign currency.

The major breakdown of the total initial investment cost is shown in Table 7.1.

185-14

Table 7.1 INITIAL INVESTMENT COST

Sr. No. 1 2 3 4 5 6 7 Cost Items Land lease value Building and Civil Work Plant Machinery and Equipment Office Furniture and Equipment Vehicle Pre-production Expenditure* Working Capital Total Investment Cost Foreign Share

Total Cost (000 Birr) 36.0 3,486.0 7,500.0 100.0 275.0 864.9 2,799.7 15,061.6 39

* N.B Pre-production expenditure includes interest during construction ( Birr 714.92

thousand ) training

(Birr 30 thousand ) and Birr 120 thousand costs of registration, licensing and formation of the company including legal fees, commissioning expenses, etc.

B.

PRODUCTION COST

The annual production cost at full operation capacity is estimated at Birr 48.05 million (see Table 7.2). The material and utility cost accounts for 95.05 per cent, while repair and maintenance take 0.24 per cent of the production cost.

185-15

Table 7.2 ANNUAL PRODUCTION COST AT FULL CAPACITY ('000 BIRR)

Items Raw Material and Inputs Utilities Maintenance and repair Labour direct Factory overheads Administration Costs Total Operating Costs Depreciation Cost of Finance Total Production Cost

Cost 45,024.24 645.16 117.04 323.55 134.81 215.7 46,460.50 1019.3 570.36 48,050.16

% 93.70 1.34 0.24 0.67 0.28 0.45 96.69 2.12 1.19 100

C.

FINANCIAL EVALUATION

1.

Profitability

According to the projected income statement, the project will start generating profit in the first year of operation. Important ratios such as profit to total sales, net profit to

equity (Return on equity) and net profit plus interest on total investment (return on total investment) show an increasing trend during the life-time of the project.

The income statement and the other indicators of profitability show that the project is viable.

185-16

2.

Break-even Analysis

The break-even point of the project including cost of finance when it starts to operate at full capacity ( year 3) is estimated by using income statement projection.

BE =

Fixed Cost Sales Variable Cost

29 %

3.

Pay Back Period

The investment cost and income statement projection are used to project the pay-back period. The projects initial investment will be fully recovered within 4 years.

4.

Internal Rate of Return and Net Present Value

Based on the cash flow statement, the calculated IRR of the project is 25 % and the net present value at 8.5% discount rate is Birr 10.09 million.

D.

ECONOMIC BENEFITS

The project can create employment for 51 persons. In addition to supply of the domestic needs, the project will generate Birr 6.9 million in terms of tax revenue. The establishment of such factory will have a foreign exchange saving effect to the country by substituting the current imports.