MAKING MAYONAISE CREAM BUSINESS IN UGANDA
Introduction
The business idea is for production and marketing of mayonnaise cream. Mayonnaise is a thick, creamy sauce or dressing that is made of oil, egg yolks, lemon juice or vinegar and seasonings. The total potential revenue is estimated at US$156,000 per year, the production capacity is estimated at 200 containers per day and the total investment cost is estimated at US $9,300. The net profit is 26% while the payback period is 1 month.
Production process
A method of producing mayonnaise comprises directing coagulated egg yolk and milk protein into a container in which they are mixed together and adding salt and a small amount of oil and colorants. The mixture is then directed through a dosing pump to a first heater in which the mixture is briefly heated to a temperature in the range of about 80°C-100°C.
The emulsion is then stirred with vinegar and other additives to form a mayonnaise. The mayonnaise is pasteurized by heating it briefly in a second heater to about 80°C-100°C or it is sterilized by heating it to a higher temperature of 110°C- 130°C. Thereafter, the pasteurized mayonnaise is cooled in a second cooler and it is continuously filled into sterilized containers.
Capital Investment Requirements in US$
| Capital investment item | Units | Qty | @ | Amount |
| Dynamic mixer | No. | 1 | 1,000 | 1,000 |
| Heater | No. | 2 | 100 | 200 |
| Delivery Van | No. | 1 | 6,500 | 6,500 |
| Cooling machine | No. | 2 | 750 | 1,500 |
| Packing materials | No. | 200 | 0.5 | 100 |
| Total Costs on Equipments | 9,300 |
Production and Operating costs in US $ General costs (overheads)
| Cost Item | Units | @ | Qty/ day | Pdn cost/ day | Pdn cost/ month | Pdn cost/ year |
|---|---|---|---|---|---|---|
| Oil | Litres | 2 | 10 | 20 | 520 | 6,240 |
| Vinegar | Litres | 3 | 5 | 15 | 390 | 4,680 |
| Milk Proteins | Kgs | 10 | 18 | 180 | 4,680 | 56,160 |
| Salt | Kgs | 0.1 | 2 | 0.2 | 5.2 | 62.4 |
| Eggs | Trays | 3.2 | 35 | 112 | 2,912 | 34,944 |
| Sub-total | 70 | 327.2 | 8,507 | 102,086 |
| Utilities (water and power) | 125 | 1,500 |
|---|---|---|
| Labour | 160 | 1,920 |
| Rent | 120 | 1,800 |
| Miscellaneous costs | 150 | 1,80`0 |
| Distribution costs | 300 | 3,120 |
| Depreciation(Asset write off)Expenses) | 194 | 2,325 |
| Sub -total | 1049 | 12,465 |
| Total Operating Costs | 9,556 | 114,551 |
- Production costs assumed 312 days per year with a daily capacity of 200 tins of mayonnaise
- Depreciation (fixed assets write off) assumes 4 years life of assets written off at 25% per year.
- Direct costs include materials, supplies and other costs that directly go into production of the product.
Project product Costs and Price Structure
| Item | Qty /day | Qty/yr | @ | Pdncost /yr | UPx | TR |
| Mayonnaise cream | 200 | 62,400 | 2.3 | 114,551 | 2.5 | 156,000 |
Profitability Analysis
| Profitability Item | Per day | Per month | Per Year |
|---|---|---|---|
| Revenue | 500.0 | 13,000 | 156,000 |
| Less production and operating Costs | 367.2 | 9,546 | 114,551 |
| Profit | 132.8 | 3,454 | 41,449 |
Market Analysis
Mayonnaise is commonly served with sandwiches and with salads. Therefore, the product has high demand. It is supplied to super markets, shops, hotels and restaurants as major outlets.
Sources of raw materials:
Raw materials are locally available in shops and markets.