MAKING SISAL FIBRE HANDCRAFTS
Introduction
This business idea is for production of sisal fibre handicrafts. Sisal fibre
extracted from sisal leaves is used for making many types of decorative items,
bags, wall hangings and toys. The products from sisal are normally appealing in tourist places, hotels and restaurants. The
business idea aims at production of 1,300 pieces of fibre handicrafts. The
revenue potential is estimated at US$ 480 per year with a sales margin of 15%.
The total capital investment for the project is US$ 1,200.
Plant Capacity
The profiled plant has a minimum capacity of 50 units per day.
Technology and Production Process
Sisal leaves are cut and fibre extracted through a Raspador machine. After
washing in water and subsequent drying, the leaves are ‘beaten’ to remove
undesired particles. The dry fibre is used for
making braids, which are dyed and made into attractive handicrafts.
Market Analysis
There is high demand for Sisal fibre Handcrafts especially in Urban and Tourist
Centres. These products are elegant and mainly consumed by high class people
hence fetching more revenue into the Country. This sector is still under
developed.
Scale of Investment
1. Capital Investment Requirements
|
Capital Investment Item |
Units |
Qty |
Unit |
Amount |
|
Raspador Machine |
No |
1 |
700 |
700 |
|
Hand tools |
No |
500 |
500 |
|
|
Total |
1,200 |
2. Production and Operation costs
|
Cost Item |
Units |
Unit cost/ |
Qty/ |
Prod |
Prod Cost/ |
Prod cost/yr |
|
Direct costs: |
||||||
|
Crude |
Kgs |
0.75 |
129 |
97 |
2,517 |
30,200 |
|
Oils |
Litres |
3 |
7 |
22 |
583 |
7,000 |
|
Scented |
Kgs |
7.5 |
1 |
10 |
250 |
3,000 |
|
Wax |
Kgs |
2 |
2 |
4 |
100 |
1,200 |
|
Packaging |
Pieces |
0.04 |
721 |
29 |
750 |
9,000 |
|
Sub-total |
4,200 |
50,400 |
||||
|
General costs (Overheads) |
||||||
|
Labour |
700 |
8,400 |
|
Other materials |
1000 |
12,000 |
|
Utilities |
1500 |
18,000 |
|
Administrative expenses |
1500 |
18,000 |
|
Selling and Distribution |
3250 |
39,000 |
|
Fuel |
3000 |
36,000 |
|
Miscellaneous expenses |
700 |
8,400 |
|
Depreciation (Asset write off) Expenses |
2544 |
30,528 |
|
Sub-total |
14194 |
170328 |
|
Total Operating Costs |
18,394 |
220,728 |
Production is assumed for 312 days per year. Depreciation assumes 4 year life of assets written off at 25% per year for all assets. A production Month is assumed to have 26 days.
3. Project Product costs and Price
Structure in US $
|
Item |
Qty |
Qty/ yr |
Unit |
Prod/ yr |
Unit |
T/rev |
|
Bags |
70 |
21,840 |
10 |
222,612 |
12 |
262,080 |
4. Profitability Analysis in US $
|
Profitability Item |
Per day |
Per Month |
Per Year |
|
Revenue |
840 |
21,840 |
262,080 |
|
Less: Production and Operating Costs |
713 |
18,526 |
222,312 |
|
Profit |
127 |
3,314 |
39,768 |
80 per year with a sales margin of 15%. The total capital investment for the project is US$ 1,200.
Plant Capacity
The profiled plant has a minimum capacity of 50 units per day.
Technology and Production Process
Sisal leaves are cut and fibre extracted through a Raspador machine. After washing in water and subsequent drying, the leaves are ‘beaten’ to remove undesired particles. The dry fibre is used for
making braids, which are dyed and made into attractive handicrafts.
Market Analysis
There is high demand for Sisal Fibre Handcrafts especially in Urban and Tourist Centres. These products are elegant and mainly consumed by high class people hence fetching more revenue into the Country. This sector is still under developed.
Scale of Investment
1. Capital Investment Requirements
|
Capital Investment Item |
Units |
Qty |
Unit |
Amount |
|
Raspador Machine |
No |
1 |
700 |
700 |
|
Hand tools |
No |
500 |
500 |
|
|
Total |
1,200 |
2. Production and Operation costs
|
Cost Item |
Units |
Unit |
Qty/ |
Pdn |
Pdn |
Pdn |
|
Direct costs3: |
||||||
|
Crude |
Kgs |
0.75 |
129 |
97 |
2,517 |
30,200 |
|
Oils |
Litres |
3 |
7 |
22 |
583 |
7,000 |
|
Scented |
Kgs |
7.5 |
1 |
10 |
250 |
3,000 |
|
Wax |
Kgs |
2 |
2 |
4 |
100 |
1,200 |
|
Packaging |
Pieces |
0.04 |
721 |
29 |
750 |
9,000 |
|
Sub-total |
4,200 |
50,400 |
||||
|
General costs (Overheads) |
||||||
|
Labour |
700 |
8,400 |
|
Other materials |
1000 |
12,000 |
|
Utilities |
1500 |
18,000 |
|
Administrative expenses |
1500 |
18,000 |
|
Selling and Distribution |
3250 |
39,000 |
|
Fuel |
3000 |
36,000 |
|
Miscellaneous expenses |
700 |
8,400 |
|
Depreciation (Asset write off) Expenses |
2544 |
30,528 |
|
Sub-total |
14194 |
170328 |
|
Total Operating Costs |
18,394 |
220,728 |
Production
is assumed for 312 days per year. Depreciation assumes 4 year life of assets
written off at 25% per year for all assets. A production Month is assumed to
have 26 days.
3.
Project Product costs and Price Structure in US $
|
Item |
Qty |
Qty/ yr |
Unit |
Pdn/ yr |
Unit |
T/rev |
|
Bags |
70 |
21,840 |
10 |
222,612 |
12 |
262,080 |
4. Profitability Analysis in US $
|
Profitability Item |
Per day |
Per Month |
Per Year |
|
Revenue |
840 |
21,840 |
262,080 |
|
Less: Production and Operating Costs |
713 |
18,526 |
222,312 |
|
Profit |
127 |
3,314 |
39,768 |
Sources of Supply of Raw Materials and Equipments
Both
Equipments and Rawmaterials can be sourced locally.
Incentives
The
Government supports small scale and women organizations through Prosperity for
All Programme, formation SACCOs, and Miicro financing