Introduction
The proposed Business Idea is to set up a plant for making and marketing of rubber balloons. Balloons are colorful rubber items produced in different sizes, patterns, designs, and shapes. Rubber balloons are play materials for children of all age groups and are also used for decorative purposes. They can be marketed through retail outlets, Stationary Shops, Fancy Stores and Gift Shops. This business idea is premised on production of 46800kgs per month which translates into 3900kgs per annum. The revenue potential is estimated at US$120058 per month translating into US$1,440,698 per annum with a sales margin of 5% and a total investment requirement is US$ 9856 for the first year of project operation.
Production Process
The latex is prepared, compounded, dipped and the film is dried and beading made with the help of moulds, through dipping and vulcanizing, the latex is stripped off, which gives the finished product; whereby a packet of 100 units of rubber balloons in different colours and sizes is ready for dispatch
Capital investment requirement in us$
| Item | Units | Qty | @ | Amount |
|---|---|---|---|---|
| De-ammoniating Vessel | No | 1 | 400 | 400 |
| Pot mill | No | 1 | 250 | 275 |
| Paddle Mixer | No | 1 | 250 | 250 |
| Dipping ace | No | 2 | 350 | 700 |
| Packing Machine | No | 1 | 600 | 600 |
| Weighing Balance | No | 1 | 150 | 150 |
| Delivery Van | No | 1 | 8000 | 8,000 |
| Total | Â | Â | Â | 10,375 |
Operating cost in us $
| Cost Item | Units | @ | Qty/ day | cost/ day | cost/ month | cost/ year |
|---|---|---|---|---|---|---|
| Direct Costs | Â | Â | Â | Â | Â | |
| Latex | kg | 1.5 | 1,000 | 1,500 | 39,000 | 468,000 |
| Chemicals and dyes | kg | 2 | 200 | 400 | 80,000 | 960,000 |
| Packing Materials | No | 1.2 | 10 | 12 | 312 | 3,744 |
| Sub-total | Â | Â | 1,210 | 1,912 | 119,312 | 1,431,744 |
General Operating Costs (Overheads)
| Rent | 50 | 600 |
|---|---|---|
| Labour | 180 | 2,160 |
| Utilities(Power) | 100 | 1,200 |
| Preliminary costs | 100 | 1,200 |
| Miscellaneous Costs | 100 | 1,200 |
| Depreciation(Asset write off)Exp | 216.16 | 2,594 |
| Sub-total | 746.16 | 8,954 |
| Total Operating Costs | 120,058 | 1,440,698 |
1,000 Kilograms of Rubber Balloons and it is assumed that each kilogram contains
50 Rubber balloons and each balloon is sold at US$0.035 on the wholesale market.
Depreciation (fixed asset write off) assumes _4_ years life of assets written off at
_25% per year for all assets.
Direct Costs include: materials, supplies and other costs that directly go into
production of the product.A production month is assumed to have 26 days.
Project cost and Price structure
| Item | Qty/ day | Qty/ Yr | @ | Pdn cost/Yr | UPx | T/rev |
|---|---|---|---|---|---|---|
| Balloons | 1,800 | 561,600 | 1.5 | 842,400 | 1.75 | 1,474,200 |
Profitability analysis table
| Profitability Item | Per day | Per Month | Per Yr |
|---|---|---|---|
| Revenue | 4,725 | 122,850 | 1,474,200 |
| Less: Production and Operating Costs | 4,618 | 120,058 | 1,440,698 |
| Profit | 107 | 2,792 | 33,502 |
Market Analysis
Rubber balloons have a steady demand in the market since they are used in all occasions especially for decorations.
Source of Raw Materials and Equipments
Raw materials (Latex Rubber) can be imported from countries like Ghana and Liberia while equipment can be imported from India and China.
Government Incentives Available.
Government is encouraging small scale businesses and income generating activities to eradicate poverty through financial institutions which provide soft loans to the investors. Organizations like Private Sector Foundation Uganda are channels through which subsidies and free advisory services are given.
