SETTING UP A POULTRY PROCESSING PLANT
Introduction
This
project idea is based on the need to add value by processing chicken to reduce
on the rudimentary form that is dangerous to human consumption. An estimated
fixed cost of 32,120US$ and operating costs of 568,250US$, when utilized can
generate a total revenue of 100US$ from the sale of 101,400 birds of one and a
half kilograms and above in weight in the first year of operation.
Production
Capacity, Technology and Process
The
production process is very simple only that it has to be automated. The process
involves collecting the chicken birds, and then cleans them up, pass them to
the automated head remover machine where the head is cut, speciallised
conveyers them transfer the killed birds to the automated picking machine which
picks and plucks the feathers off the birds and this limits also incidences of product
bruising. After plucking and picking is done, the birds is passed to the
eviscerating equipment where the birds are “gutted”ie the birds body opened and
the internal organs removed except for the kidney. The kidney can be manually
removed and then the birds are packed and stored in a chilling machine ready
for distribution.
Investment
Scale, Capital Requirement and Equipment
The
investment scale required is somehow large especially in acquisition of the
equipment but some modern automated equipments at relatively small scale
production can be acquired and these may include those as tabled bellow
Capital
Investment Requirements
Item |
Units |
Qt |
Unit |
Amo |
Head Remover |
No |
7 |
260 |
1,820 |
ZD60-80 Un hair machine |
No. |
1 |
5,000 |
5,000 |
Claw removing machine |
No. |
1 |
1,700 |
1,700 |
Eviscerating machine |
No. |
1 |
3,600 |
3,600 |
Chilling machine |
No. |
2 |
2,500 |
5,000 |
Convey belts |
No. |
1 |
2,750 |
2,750 |
Delivery van (Refrigerator) |
No. |
1 |
10,000 |
10,000 |
Other tools |
No. |
- |
- |
2,250 |
Total |
32,120 |
Production and Operating Costs
(a)Direct materials, Supplies and Costs
Cost Item |
Units |
Uni |
Qty |
Pdn |
Pdn |
Pdn |
Chicken birds |
Kgs |
4.25 |
325 |
1,381 |
35,913 |
430,950 |
Water |
liters |
0.01 |
3,205 |
32 |
833 |
10,000 |
Packaging |
Pieces |
0.13 |
2,000 |
260 |
6,760 |
81,120 |
1)
Production costs assumed 312 days per year with daily capacity of processing 325
birds.
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) Total monthly days assumed are 26-days.
5) The valuation currency used is United States Dollars.
Market
Analysis
Chicken
is widely consumed in many households in the country especially in urban
centers where packed chicken is the more consumed than the buying of live birds
to be prepared at home locally. Ugachic is the major key player in this
industry.
Project
product costs and price Structure
Item |
Qty |
Qty |
Unit |
Pdn |
Unit |
T/rev |
Processed |
325 |
101,400 |
5.60 |
568,250 |
6.5 |
659,100 |
Profitability Analysis Table
Profitability Item |
Per Day |
Per |
Per |
|
|||||
Revenue |
2,112.50 |
54,925 |
659,100 |
|
|||||
Less: Production &Operating Costs |
1,821 |
47,354 |
568,250 |
|
|||||
Profit |
291.19 |
7,570.87 |
90,850 |
Sub-total |
5,530 |
1,673 |
43,506 |
522,070 |
|
|
|
|
|
General Costs(Overheads) |
|
|
|
|
|
|
|
|
|
Labour costs |
1,200 |
14,400 |
|
|
|
|
|
|
|
Utilities |
1,000 |
12,000 |
|
|
|
|
|
|
|
Administration expenses |
292 |
3,500 |
|
|
|
|
|
|
|
Selling & distribution |
167 |
2,000 |
|
|
|
|
|
|
|
Fuel |
200 |
2,400 |
|
|
|
|
|
|
|
Miscellaneous expenses |
125 |
1,500 |
|
|
|
|
|
|
|
Cleaning and toiletries |
196 |
2,350 |
|
|
|
|
|
|
|
Depreciation |
669 |
8,030 |
|
|
|
|
|
|
|
Sub-total |
3,848 |
46,180 |
|
|
|
|
|
|
|
Total Operating Costs |
47,354 |
568,250 |
|
|
|
Incentives
The
Government has put aside an Agricultural fund and there is an European
Investment Fund targeting such areas of investment.