MANUFACTURING METALIC FASTENERS IN UGANDA

Introduction

Belt fasteners are used widely in industries manufacturing suit cases, travel bags, apparel belts, shoes etc. They could be manufactured in different sizes and designs depending on the demand. The unit would make the buckles for the belts as well as the shoes in different varieties. The variety may include double wire lock buckle, oval shape shoe buckle, square pronged buckle, rectangular buckle among others. There are however no standard set up for these items since the designs, size, and material are constantly changing due to the market demand.

Production Capacity, Technology and Process

The manufacturing process involves the use of two types of machines which include a power press as well as hand press on one hand and a hook making machine on the other. The mild steel plate of gauge 19/20 is cut into strips of appropriate size using a bench shearing machine. The sheared plate is then punched out using a power press, and finally, fly presses are used to mould and smoothen the article. The produced article goes through the electroplating plant to give it the final desired coloring or look which may be chrome, golden, silver etc. The established setup would produce about 2,500 pieces of fasteners of different sizes a day thus 780,000 per year. The Revenue Potential is estimated at 234,000 per year. The net profit margin is at 51%.

Investment Scale, Capital Requirements and Equipment

The investment scale depends on the project set objectives.

Capital Investment Requirements in US$

Direct Materials, Supplies and Costs in US$ Production and operation Costs

General Costs (Overheads)

1. Production costs assumed 312 days per year with daily capacity of producing 2,500 belt fasteners.
2. Depreciation (fixed asset write off) assumes 4-years life of assets written off at 25% 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

The market for fasteners is readily available as there are many small scale establishments engaged in the production of items that would use these products. Currently these items are imported. Their absence may contribute to failure to manufacture belts locally. Thus, this is a venture likely to stimulate other items to be produced. They could be exported to our neighbors especially Kenya where their use is more pronounced.

Project Product Costs and Price Structure in US$

Profitability Analysis table

Government Facilities and Incentives

The Income tax Act 1997 allows a 25% charge on start up costs spread over years and the government has set up liberalized trade and commerce policies.