ICE CREAM MAKING

Introduction

Ice cream is a frozen dessert usually made from dairy products such as: milk and often combined with other ingredients and flavours. Most varieties contain sugar although some are made with other sweeteners. Alternatively it can be made from soya milk, rice milk and goat milk for those who are lactose intolerant or allergic to dairy products and soya and rice for those who avoid dairy products. The production capacity is 38,398kg per year yielding revenue of US $995 per annum from an investment of US $57,832.


Production Process, Capacity and Technology

The basic steps in manufacturing ice cream are generally as follows: Blending of the mix ingredients, pasteurization, and homogenization, ageing the mixture, freezing, packaging and hardening. Ice-cream represents a congealed dairy product produced by freezing a pasteurized mixture of milk, cream, and milk solids other than fat, sugars, emulsifier and stabilizers.


Market Analysis

There are two types of ice-cream, soft and hard available on the market. Ice cream is readily marketable as it’s consumed by all sections of society. What is needed is strategic location of the business. The major key players in this sector includes; Snowman, Fido Dido, BIMBO, among others.


Capital Investment Requirement in US $

Item

Units

Qty

Cost

Total

Mixing / blending machine

No

1

3,000

3,000

Homogenization machine

No

1

3,000

3,000

Ageing % storage vat

No

1

3,000

3,000

Batch Freezers

No

2

1,500

3,000

Pasteurization machine

No

1

3,000

3,000

Hardening machine

No

1

3,000

3,000

Storage (Refrigerated)

No

1

3,000

3,000

Distribution Van

No

1

7,000

7,000

Total cost of Machinery & Tools

28,000




 

1.    Production costs assume 312 days per year with daily capacity of 123Kgs.

2.     Depreciation (fixed asset write off) assumes 4 year life of assets written off at 25% per year for all assets.

3.     Direct costs include: materials, supplies and all other costs incurred to produce the product.

4.     A production month is 26 work days

5.     Currency used is US Dollars.

Production and Operating cost in US$
 Direct materials, supplies and costs

Cost Item

Units

Unit
Cost

Qty/
day

Prod
cost/
day

Prod
cost
/month

Prod
cost
/yr

Direct Costs







milk (solid/ fat)

Kgs

2.25

38

87

2,250

27,000.

sugar,

Kgs

1

10

11.00

286.

3,432

Flavourings,
Candies & fruits

Kgs

3

2

5.00

130

1,560

Stabilizers /
emulsifiers

Kgs

2

0.16

0.24

6.25

75.00

Eggs

Trays

2

2

4.50

117.

1,404.

Sub-total

98

2,536.

30,432




General Costs (Overheads)







Labour

800

9,600





Selling & distribution

100

1,200





Utilities (Water, power)

500

6,000





Rent

200

2,400





Miscellaneous expenses

100

1,200





Depreciation

583

7,000





Sub-total

2,283

27,400





Total Operating Costs

4,819.

57,832





 

Project product cost and Price Structure in US$

Item

Qty
/day

Qty
/yr

Unit
Cost

Prod
cost/yr

Unit
price

Total
rev

Ice Cream

123

38,398

1.5

57,832

2.5

95,995

 

Profitability analysis in US$

 Item

Per
day

Per
month

Per
year

Revenue

308

8,000

95,995

Less: Production and operating costs

86

2,224

57,832

Profit

222

5,775

38,163