MAKING POTTERY PRODUCTS
Introduction
This business idea is for production and marketing of pottery products on a
small scale investment. Pottery is the process of mixing clay with water; and
shaping the mixture into pottery products/Pottery ware such as: pots, cups,
plates, bowls, urns and candle holders. The market structure and demand for
pottery products is generally wide because they are sold in places like curio
shops, Art Kiosks and
other places. They are used for various purposes such as: decorations, flower
vases in workplaces, schools, lodges and households; while some products can be
exported. The business idea aims at production of 104 pottery products per
month which translates into 1,248 pottery products per year. The revenue
potential is estimated at US$ 1040 per month, translating into US$12,480 per
year with a sales margin of 5% and total investment capital of US$10,362 for
the first year of project operation.
Market Analysis
The Market for pottery products is wide since they are multipurpose and the products
can be sold for many different users.
Production Capacity
The production capacity depends on the intended number of products a
manufacturer is willing and able to make, their sizes and the quantity of raw
materials used in the production process. In this case, the total cost of this
project is US$ 148.
Technology and Process Description
The technology used is relatively simple as it involves modeling red clay by
use of hands, shaping tools and paint for decorating. Pottery is the process of
mixing clay with water; and shaping the mixture into pottery wares. The modeled
objects are then exposed to heat to dry then put in a kiln for burning to get
the final product.
Scale of Investment Capital
Investment Requirements And
Equipment.
The scale of investment generally depends on the interests of the manufacturer
and the demand for the products.
Capital Investment Requirements in US$
|
Capital Investment Item |
Units |
Qty |
Unit Cost |
Amount |
|
Basins |
No |
4 |
1.5 |
6 |
|
Hoes |
No |
4 |
2.5 |
10 |
|
Kiln |
No |
1 |
150 |
150 |
|
Medium Working table |
No |
2 |
100 |
200 |
|
Jerry cans |
No |
4 |
2.5 |
10 |
|
Total |
376 |
Production
and Operating Costs
Direct Materials, Supplies and Costs in US$
|
Cost Item |
Units |
Unit |
Qty/ |
cost/ |
cost/month |
cost/ |
|
Direct Costs |
||||||
|
Red Clay |
kg |
0.1 |
40 |
4 |
104 |
1,248 |
|
Grass |
Bundle |
0.25 |
10 |
2.5 |
65 |
780 |
|
Water |
Liter |
0.0025 |
5 |
0.0125 |
0.33 |
3.90 |
|
Sand |
kg |
0.25 |
10 |
2.5 |
65 |
780 |
|
Sub-total |
65 |
9.0125 |
234.33 |
2,811.90 |
||
|
General Costs(Overheads) |
||||||
|
Labour |
400 |
4800 |
||||
|
Utility(Firewood, ) |
50 |
600 |
||||
|
Oil paint |
40 |
480 |
||||
|
Transport |
50 |
600 |
||||
|
Miscellaneous costs |
50 |
600 |
||||
|
Depreciation(Asset write off)Expenses |
7.8 |
94 |
||||
|
Sub-total |
598 |
7,174 |
||||
|
Total Operating Costs |
832.16 |
9,985.90 |
1. Production costs assumed are for 312 days per year with a daily capacity of 4 big pots but the business unit can also make other pottery products in different sizes and shapes.
2. Depreciation (fixed asset write off) assumes 4 years life of assets written off at _25% per year for all assets.
3. Direct Costs include materials, supplies and other costs that directly go into production of the product.
4. A production month is assumed to have 26 days.
Product Cost and Price Structure in US$
|
Item |
Qty/ |
Qty/Y |
Unit |
Prod |
Unit |
T/rev |
|
pots |
4 |
1,248 |
8.0 |
9,986 |
10 |
12,480 |
Profitability Analysis in US$
|
Profitability Item |
Per |
Per |
Per Yr |
|
Revenue |
40 |
1,040 |
12,480 |
|
Less: Production and Operating Costs |
32 |
832 |
9,986 |
|
Profit |
8 |
208 |
2,494 |