MAKING SEALING WAX
Introduction
This business idea is for the production and marketing of Sealing Wax. The idea
is premised on the production of 13,000 Sealing wax per month. The revenue
potential is estimated at US$750 per year. This investment can cost US$ 62,256.
Production Process
Rosin and shellac are melted and then the fillers such as: kaolin, soapstone,
barites, colors, oxides and oil soluble organic dyes are added for black
sealing wax, most often used in Post offices and railways. The molten material
is then poured in the metal moulds made of aluminum or gunmetal. For better
plasticity in sealing waxes, a little quantity of bee wax and castor oil are
added. The product is then packed in cartons containing 500 grams of sticks.
Market Analysis
The sealing wax has good demand in Postal services, Railways, in all corporate
offices, educational institutions and Government offices, etc. there are no
players yet in this sector in Uganda.
Capital Investment Required in US$
|
Item |
Unit |
Qty |
Unit |
Total |
|
Coal fired oven |
No. |
1 |
400 |
400 |
|
Melting pan (MS) |
No. |
1 |
10 |
10 |
|
Moulds with water- cooling system. |
No. |
1 |
100 |
100 |
|
Weighing scale with weights. |
No. |
1 |
25 |
25 |
|
Drums. |
No. |
10 |
10 |
100 |
|
Buckets |
No. |
5 |
4 |
18 |
|
Total cost of Machinery |
653 |
Production and
Operating Costs in US$
a) Direct Materials, Supplies and Costs
|
Cost Item |
Units |
Unit |
Qty/ |
Prod. |
Prod. |
Prod. |
|
Shellac |
Kgs |
5 |
15 |
75 |
1,950 |
23,400 |
|
Rosin |
Kgs |
5 |
10 |
50 |
1,300 |
15,600 |
|
Filler |
Kgs |
5 |
3 |
15 |
390 |
4,680 |
|
Color, oxides |
Ltrs |
5 |
5 |
25 |
650 |
7,800 |
|
Sub-total |
4,290 |
51,480 |
||||
|
General costs (Overheads) |
||||||
|
Utilities (power) |
150 |
1,800 |
||||
|
(Utilities (water) |
15 |
180 |
||||
|
packaging |
30 |
360 |
||||
|
Vehicle hiring |
260 |
3,120 |
||||
|
Salaries |
300 |
3,600 |
||||
|
renting |
75 |
900 |
||||
|
Depreciation (Assets write off) Expenses |
14 |
163 |
||||
|
Sub-total |
844 |
10,123 |
||||
|
Total Operating costs |
5,134 |
61,603 |
Production costs assumed are for 312 days per year with a
daily capacity of 500 Sealing Wax. Depreciation (fixed assets write off)
assumes 4 years life of assets write off of 25% per year for all assets. Direct
costs include: materials, supplies and other costs that directly go into
production of the product.
Product Cost and Price Structure in US$
|
Item |
Qty/day |
Qty/yr |
Unit |
Prod. cost |
Unit price |
Total revenue |
|
Sealing wax |
500 |
156,000 |
0.23 |
35,880 |
0.75 |
117,000 |
Profitability Analysis in US$
|
Profitability item |
per day |
per month |
per year |
|
Revenue |
|||
|
Sealing wax |
375 |
9,750 |
117,000 |
|
Less Prod & Operating Costs |
197 |
5,134 |
61,603 |
|
Profit |
178 |
4,616 |
55,397 |