BUSINESS IDEA FOR PAINT MANUFACTURING IN UGANDA

 BUSINESS IDEA FOR PAINT MANUFACTURING IN UGANDA

Introduction

Paint manufacture involves the mixing of different chemicals at different sequences and at specified durations for them to set and form a thick and, or sticky solution that is used to coat structure surfaces when applied to give them a decorated look of the desired colours. The mixing is done by a trained person with acumen in that field. This industry product is on high demand since the Construction sector is growing very fast and booming. The capital outlay is a bit stretched but the return on investment justifies it.

The project requires an estimated fixed capital of US$ 14,544 and operating costs of US$ 491,765 generating revenue of US$ 698,880 in the first year of operation.

Production Capacity, Technology and Process

Paint manufacture machinery and equipment can be located in a moderate space of about 15ft *20ft, and a store of about 15ft* 10ft plus an office space of about 120 square feet. The factory production capacity depends on the size of the machinery the shifts operated and the capital invested. If materials are available, the factory can operate up to three shifts. Costing is based on a capacity of 2,000 jerry cans of emulsion paint a month.

Capital Investment Requirements in US$

Capital Investment Item Units Qty @ total
Mixer No 1 2,400 2,400
Electrical Installation No 750
Weighing Scale (Digital) No 1 300 300
Laboratory Equipment No 1 400 400
600 Liter drums No 3 100 300
Jerry cans No 1,600 2 3,200
Pickup No 1 7,000 7,000
Viscometer No 1 100 100
Carrier Trolley No 1 50 50
Time Watch No 1 4 4
Tool Kit No 1 40 40
Total       14,544

Production and Operating Costs (a)Direct Materials, Supplies and Costs

Cost Item Units @ Qty/ day Pdn Cost/ day Pdn Cost/ mth Pdn Cost/ yr
Direct Costs          
TT Kgs 3 96 288 7,488 89,856
PVA Kgs 2 80 160 4,160 49,920
Whiting Kgs 0.15 1,600 240 6,240 74,880
Foam line Mlgm 1.5 11.2 16.8 437 5,242
Ammonia Mlgm 0.02 400 8 208 2,496
Nitrosal Kgs 11 24 264 6,864 82,368
Water Ltrs 0.03 1,920 57.6 1,498 17,971
Packaging Materials Pcs 2 160 320 8,320 99,840
Sub-total         35,214 422,573

General costs (Overheads)

Rent 750 9,000
Labour 1,454 17,448
Protective ware 83 996
Power 1,950 23,400
Selling and Distribution 688 8,256
Cleaning and Toiletries 271 3,252
Miscellaneous 267 3,204
Depreciation 303 3,636
Sub-total 5,766 69,192
Total Operating Costs 40,980 491,765
  1. Production costs assumed 312 days per year with daily capacity of producing 160-20ltr jerry cans of emulsion paint.
  2. Depreciation (fixed asset write off) assumes 4-years life of assets written off at25% 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

Construction Sector is one of the fastest growing sectors in the country. There is therefore, a ready market for the paint and paint products once quality is taken into account during production. Construction Companies, Estate Developers, Hardware shops, Institutions as well as individuals are the potential customers.

Project product costs and Price Structure

Item Qty/ day Qty/yr @ Pdn Cost/yr UPx Total Rve
Emulsion Paint 160 49,920 9.8510577 491,765 14 698,880

Profitability Analysis Table

Profitability Item Per day Per Mnth Per year
Revenue 2,240 58,240 698,880
Less: Production and Operating Costs 1576 40,980 491,765
Profit 664 17,260 207,115

 

Capital Investment Requirements in US$

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