MAKING PAPER ENVELOPES BUSINMESS IN UGANDA

Introduction

Paper envelopes are stationery products that can easily be marketed as the users and consumers are very many such as government organizations, schools, courier organizations and individual consumers.

The establishment of this project requires total operating costs of US$122, 412, generating revenue of US$ 312,000 in the first year of operation. The net profit margin is 61%.

Production Capacity, Technology &Process

A paper cutting machine is used to cut different paper pieces to sizes as wanted by the operator for the type and size of envelopes to be produced. Binding glue is then applied to the cut sides of the paper and later they are joined together. Labeling can be done thereafter. The envelopes are then packed ready for distribution.

Capital investment item units Qty @ Total
Paper Cutting machine No 1 250 250
Rulers No 100 0.4 40
Pencils No 300 0.04 12
Glue Sticks No 125 1.6 200
Scissors No 34 4 136
Furniture No 300
Other tools No 400
Total       1,338
Labour 250 3,000
Utilities 150 1,800
Rent 100 1,200
Selling & distribution 100 1,200
Cleaning & toiletries 50 600
Miscellaneous expenses 100 1,200
Depreciation 100 1,200
Sub-total 850 10,200
Total Operating Costs 10,201 122,412

Production and Operating Costs in US$

Production costs assumed are for 312 days per year with daily capacity of producing 5,000pieces of paper envelopes.

  1. Depreciation (fixed asset write off) assumes 4-years life of assets written off at 25% per year for all assets.
  2. Direct costs include materials, supplies and other costs that directly go into production of the product.
  3. Total monthly days assumed are 26-days.
  4. The valuation currency used is United States Dollars.

Direct Materials, Supplies and Costs Market Analysis

Cost Item Units @ Qty/ day Pdn cost/day Pdn cost/ mth Pdn cost/Yr
Direct Costs          
Wall Paper Samples Mtrs 1.5 20 30 780 9,360
Bonded Paper Mtrs 2 34 68 1768 21,216
Decorative Paper Mtrs 10 22 220 5720 68,640
Printer Paper Reams 1.5 10 15 390 4,680
Glue Ltrs 4 3 12 312 3,744
Old Calendars Pictures Mtrs 2 5 10 260 3,120
Other materials   121 1,452
Sub-total     143 355 9,351 112,212

Stationery products have a high demand by many institutions such as: schools, Government bodies, Stationery shops, NGOS and individual buyers.

Project Product Costs and Price Structure

Item Qty/day Qty/yr @ Pdn cost/yr UPx T/rev
Paper Envelopes 2,500 780,000 0.08 119,884 0.4 312,000

Profitability Analysis Table

Profitability Item Per Day Per Month Per Year
Revenue 1000 26,000 312,000
Less: Production &Operating Costs 392 10,201 122,412
Profit 608 15,799 189,588

Government Facilities & Incentives

Some Stationery products are zero rated products.

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