MAKING RUBBER WASHERS

Introduction

The rubber washers are rings made of rubber used in mechanical devices and are used to plug any sort of leak in the pipeline system, seal parts in contact with liquids. They are used to prevent vibrations from spreading from one part to another so reducing noise. These are mainly common with chemical and food industries as major consumers of rubber washers and gaskets, etc. With the continuing and increase in the rate of construction works, the demand for rubber washers, many of which are imported, will increase. The project cost is US $129,466 producing 360,000 units annually translating into revenue estimated at US $ 993 per year. Thus is viable and can be put up in areas where access to prime properties is guaranteed.


Production Process

In manufacturing these products, rubber compounds are cut into moulds and pressed with the help of hand press, which are heated with steam, cut to required sizes and finally packed for the market. The profiled plant has a minimum plant capacity of 360,000 units of washers per annum.


Market Analysis

Industrial houses are the major consumers of rubber washers. Therefore, the entrepreneur has to establish a network before entering the market. However, due to the booming premises’ construction in the country the market is promising. This product is not produced in the country yet.


Capital Investment Requirement in US$

Item

Units

Qty

Price

Total

Fly press Machine

No

1

1,125

1,125

Moulds

No

4

1,500

6,000

Furniture

No

5

75

375

Other hand tools

No

1

500

500

Total cost of tools

8,000




 

1.    Production costs assume 312 days per year with daily capacity of 1,154 washers.

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 costs 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







Rubber

Kgs/
pckts

34

9.62

326.9

8500

102,000.

other
chemicals

ltrs

75

0.32

24.0

625

7,500.

Packaging
materials -
paper boxes

Kgs/
pckts

1.5

3.21

4.8

125

1,500.

Lubricant

kgs/ltrs

12.5

0.3

4

104

1,250.

Polyethene
bags

Kgs/
pckts

1

1

0.50

13

156.

Sub-total

360

9,367

112,406




General Costs (Overheads)







Labour

455

5,460





Selling & distribution

250

3,000





Utilities (Water, power)

250

3,000





Rent

200

2,400





Miscellaneous expenses

100

1,200





Depreciation

167

2,000





Sub-total

1,422

17,060





Total Operating Costs

10,78
9

129,466.














 

Project product costs and Price Structure in US $

Item

Qty/
day

Qty/yr

Unit
Cost

Prod
cost/yr

Unit
price

Total
rev($)

Rubber
Washers

1,154

359,986

0.4

129,466

0.5

179,993

 

Profitability Analysis in US $

 Item

Per
day

Per
month

Per
year

Revenue

577

14,999

179,993

Less: Production and operating costs

415

10,789

129,466

Profit

162

4,211

50,527