SOCKS MAKING
Introduction
This business idea is for making of cotton socks. Socks are garments worn on
the feet. They help absorb sweat and draw it to areas where air can evaporate
the precipitation. Socks are worn by males and females
both children and adults. The business idea aims at production of 78,000 pairs
of socks annually. The revenue potential is estimated at US $ 400 annually with
a total capital investment of US $ 17,017.
Plant Capacity
Production capacity will vary considerably depending on the number and types of
machines being used and the type of socks being produced. However, this profile
envisages production of 250 pairs of socks a day.
Production Process
1. Knitting
Raw materials are knit on the knitting machines according to the types and
colors of socks you intend to produce. A multitude of needles then knit the
various threads into a series of interlocking loops. These loops form the tube
of woven material used in making socks.
2. Sewing
Thereafter, the individual pieces are turned inside out and inspected for
defects. The qualified semi formed socks are then inserted into an automatic
sewing machine which forms the toe of the sock and thus completes the
production phase of the process.
3. Setting
The socks are turned right side out, and fitted onto boarding machines for
setting the sock.
4. Inspection and packaging
After setting, the socks are inspected, paired, packed and are ready for
shipping.
Market Analysis
Socks are a necessity to all classes of people both Adults and Children. There
are no players in this industry.
Scale of Investment
1. Capital Investment Requirements in US$
|
Item |
Units |
Qty |
Unit |
Amount |
|
Knitting machine |
1 |
1,795 |
1,795 |
1.795 |
|
Hosiery machine |
No |
15 |
980 |
14,700 |
|
Setting Machine |
No |
2 |
153 |
306 |
|
Sock sewing machine |
No |
1 |
216 |
216 |
|
Total |
17,017 |
2. Production and Operation costs in US$
|
Cost |
Units |
Unit |
Qty |
Prod. |
Prod. |
Prod. |
|
Direct costs: |
||||||
|
Cotton |
meters |
2.0 |
800 |
1,600 |
41,600 |
499,200 |
|
Subtotal |
|
41,600 |
499,200 |
|
General costs (Overheads) |
|
|
|
Labour |
500 |
6,000 |
|
Utilities |
300 |
3,600 |
|
Selling and Distribution |
150 |
1,800 |
|
Administrative expenses |
200 |
2,400 |
|
Shelter |
400 |
4,800 |
|
Depreciation (Asset write off) Expenses |
355 |
4,254 |
|
Sub-total |
1,905 |
4,254 |
|
Total Operating Costs |
43,505 |
503,454 |
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/ |
Unit |
T/rev |
|
Socks |
250 |
78,000 |
6 |
503,454 |
8 |
624,000 |
|
Total |
78,000 |
503,454 |
624,000 |
4. Profitability Analysis Table
|
Profitability |
Per |
Per |
Per Year |
|
Revenue |
2,000 |
52,000 |
624,000 |
|
Less: Operating Costs |
1,614 |
41,955 |
503,454 |
|
Profit |
386 |
10,046 |
120,546 |