FOREST LODGE BUSINES IN UGANDA

Introduction

This business idea is for establishing a forest lodge. This business idea aims at accommodating 8 people per day. The revenue potential is estimated at US$ 31,171 per month translating into US$ 374,052 per year. The total investment capital is US$ 876,730 and a profit of US $ 1,049,688 per year. This idea is also expected to yield a net profit margin of 74% and to have a payback period of 6months.

Project Description

The idea assumes a facility with 20 rooms, accommodating an average of 8 people per night and serving 15 plates of food and 20 drinks per day. Other incomes may be got from entry to the facility just to relax.

Capital Investment Requirements in US$

Item Qty Cost Amount
Land Purchase (acres) 5 28000 140,000
site preparation 5 2800 14,000
Generator 1 3200 3,200
Solar Panels 20 15000 300,000
Gas (Big cylinder) 1 5000 5,000
Cottage Construction 20 12000 240,000
Water Pump 1 40000 40,000
Telecom equipment 1 2000 2,000
Walkways, campsite, 1 3000 3000
Tv 15″ 25 240 6,000
Item Qty Cost Amount
Radio system 1 402 402
Beddings and curtains 1 2000 2,000
Kitchen Requirements 1 64000 64,000
Office Requirements 1 24800 24,800
Center/coffee table 15 180 2,700
Single bed boxes 13 150 1,950
Twin bed boxes 22 200 4,400
Easy sofas 50 140 7,000
Side stool 40 24 960
Mattresses 50 70 3,500
Money Safe 1 400 400
Vehicles 2 4000 8,000
Restaurant equipment 1 2400 2,400
Front office designs 1 1000 1,000
Key holders 30 0.6 18
Total 876,730

Production and Operating Costs Direct Materials, Supply and Costs in US$

Cost Item Units Pdn cost/ day Pdn cost/ month Pdn cost/year
Direct Costs
Food stuffs various 400 12,000 144,000
Subtotal 12,000 144,000
General Costs(Overheads)
Utilities(Firewood & Water) 4,600 55,200
Labour 53,340 640,080
Miscelleneous costs 200 2,400
Depreciation(Asset write off)Exp 3,653 43,836
SubTotal 61,793 741,516
Total Operating Costs 73,793 885,516
  1. Production costs assumed are for 366 days per year.
  2. Depreciation (fixed asset write off) assumes a 1 years’ life of assets written off at 4% per year for all assets.
  3. A production month is assumed to have 30 days.

Project Product Costs and Price Structures in US$

Item Qty/day Qty/Yr UPx T/rev
Single room 3 1,098 300 329400
Double room 5 1,830 360 658,800
Food stuffs 15 5,490 50 274,500
Drinks 20 7,320 12 87,840
Other Incomes 20 7,320 10 73,200
Total 1,423,740

Profitability Analysis in US$

Profitability Item Per day Per Month Per Yr
Revenue 3,901 118,645 1,423,740
Less: Operating Costs 1,039 31,171 374,052
Profit 2,862 87,474 1,049,688

Market Analysis:

With the growing tourist potential in the country, the market is wide. the projected areas include Mt.Elgon National park, Kibale conservation area, Kidepo valley national park, lake Mburo national park among others.

Sources of supply of raw materials

All the raw materials required in the operation of the lodge are locally available in Uganda. These include food, drink and bed facilities. Food stuffs can be obtained from any local community adjacent to the protected area. Drinks (soft and beers) and bed facilities can be obtained from either nearby trading centers or Kampala city.

Government facilities & incentives available

The Government supports the formation of Associations in different sectors. In addition the Uganda Investment Authority is also set up to promote and facilitate the potential investors.

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