MAKING RUBBER BALLOONS
Introduction
The proposed Business Idea is to set up a plant for making and marketing of
rubber balloons. Balloons are colorful rubber items produced in different
sizes, patterns, designs, and shapes. Rubber balloons are play materials for
children of all age groups and are also used for decorative purposes. They can
be marketed through retail outlets, Stationary Shops, Fancy Stores and Gift
Shops. This business idea is premised on production of 26,000kgs per month
which translates into 312,000kgs per annum. The revenue potential
is estimated at US$500 per month translating into US$546,000 per annum with a sales
margin of 5% and a total investment requirement is US$ 487,074 for the first
year of project operation.
Market Analysis
Rubber balloons have a steady demand in the market since they are used in all occasions especially for decorations.
Production Process
The latex is prepared, compounded, dipped and the film is dried and beading made with the help of moulds, through dipping and vulcanizing, the latex is stripped off, which gives the finished product; whereby a packet of 100 units of rubber balloons in different colours and sizes is ready for dispatch.
Capital Investment Requirements in US$
|
Item |
Units |
Qty |
Unit Cost |
Amount |
|
De-ammoniating Vessel |
No |
1 |
250 |
250 |
|
Pot mill |
No |
1 |
275 |
275 |
|
Paddle Mixer |
No |
1 |
250 |
250 |
|
Dipping ace |
No |
2 |
200 |
400 |
|
Packing Machine |
No |
1 |
400 |
400 |
|
Weighing Balance |
No |
1 |
100 |
100 |
|
Delivery Van |
No |
1 |
6000 |
6,000 |
|
Total |
7,675 |
Production
and Operating Costs
Direct Materials, Supplies and Costs in US$
|
Cost Item |
Units |
Unit |
Qty/ |
cost/ |
cost/month |
cost/year |
|
Direct Costs |
||||||
|
Latex |
kg |
1.25 |
1,000 |
1,250 |
32,500 |
390,000 |
|
Chemicals |
kg |
1 |
250 |
250 |
6,500 |
78,000 |
|
Packing |
No |
1 |
10 |
10 |
260 |
3,120 |
|
Sub-total |
1,260 |
1,510 |
39,260 |
471,120 |
||
|
General Operating Costs (Overheads) |
||||||
|
Rent |
50 |
600 |
||||
|
Labour |
180 |
2,160 |
||||
|
Utilities(Power) |
100 |
1,200 |
||||
|
Preliminary costs |
100 |
1,200 |
||||
|
Miscellaneous Costs |
100 |
1,200 |
||||
|
Depreciation(Asset write off)Expense |
160 |
1,919 |
|
|
|
|
|
Sub-total |
690 |
8,279 |
|
|
|
|
|
Total Operating Costs |
39,950 |
479,399 |
|
|
|
|
1. Production costs assumed are for 312 days per year with a daily capacity of 1,000 Kilograms of Rubber Balloons and it is assumed that each kilogram contains 50 Rubber balloons and each balloon is sold at US$0.035 on the wholesale market.
2. Depreciation (fixed asset write off) assumes 4 years life of assets written off at _25% per year for all assets.
3. Direct Costs include: materials, supplies and other costs that directly go into production of the product.
4. A production month is assumed to have 26 days.
Project Product Cost and Price Structure in US$
|
Item |
Qty/ |
Qty/ Yr |
Unit |
Prod |
Unit |
T/rev |
|
Balloons |
1,000 |
312,000 |
1.5 |
479,399 |
1.75 |
546,000 |
Profitability Analysis in US$
|
Profitability Item |
Per |
Per |
Per Yr |
|
Revenue |
1,750 |
45,500 |
546,000 |
|
Less: Production and Operating Costs |
1,537 |
39,950 |
479,399 |
|
Profit |
213 |
5,550 |
66,601 |