MANUFACTURING PRINTING INK BUSINESS IN UGANDA
Introduction
Printing ink is one of the most needed products in the printing industry. Most of the printing ink is imported and this gives an opportunity for any new company to explore the un tapped section in the industry. This Idea therefore targets a wide market with an estimated fixed capital of US$ 15,020 and operating costs of US$ 377,663 generating revenue of US$ 561,600 in the first year of operation with the net profit margin of 33%.
The payback period for the project is 3 months.
Production Capacity, Technology and Process
The most efficient method of manufacturing printing ink is the paste form. Here raw materials such as dry pigments are mixed with additives such as oxidants, modifiers, driers wetting agents in a stainless planetary mixer. The mixture is then passed into a triple roll for a number of times until the required quality standard is attained. The paste form ink is then packed.
Investment Scale, Capital Requirements and Equipment
The investment scale largely depends on the set project objectives.
Capital Investment Requirements in US$
| Capital Investment Item | Units | Qty | @ | total |
|---|---|---|---|---|
| Ball Mill | No | 1 | 1650 | 1650 |
| Varnish Kettle | No | 1 | 825 | 825 |
| Planetary Mixer | No | 1 | 1500 | 1500 |
| Triple Roll Mill | No | 1 | 2500 | 2500 |
| Vessels | No | 2 | 750 | 1500 |
| Hot Plates | No | 3 | 275 | 825 |
| Furniture | No | – | 1500 | 1500 |
| Storage Tanks | No | 3 | 500 | 1500 |
| Weighing Scale | No | 1 | 300 | 300 |
| Laboratory equipment | No | 1 | 2420 | 2420 |
| Other tools | – | – | 500 | |
| Total | 15,020 |
Production and Operating Costs in US$ (a)Direct Materials, Supplies and Costs
| Cost Item | Units | @ | Qty/ day | Pdn Cost/ day | Pdn Cost/ mth | Pdn Cost/yr | |
| Direct Costs | |||||||
| Dyes | Kgms | 10 | 55 | 550 | 14,300 | 171,600 | |
| Solvents | Kgms | 5.6 | 20 | 112 | 2,912 | 34,944 | |
| Resins | Kgm | 7 | 45 | 315 | 8,190 | 98,280 | |
| Waxes | Kgms | 4 | 15 | 60 | 1,560 | 18,720 | |
| Other Materials | Kgms | – | – | – | 0 | 0 | |
| Packaging materials | Pcs | 0.5 | 135 | 67.5 | 1,755 | 21,060 | |
| Sub-total | 270 | 1,105 | 28,717 | 344,604 | |||
| Advertising | 200 | 2,400 |
|---|---|---|
| Labour | 1188 | 14,256 |
| Utilities | 483 | 5,796 |
| Cleaning and Toiletries | 396 | 4,752 |
| Miscellaneous | 175 | 2,100 |
| Depreciation | 312.92 | 3,755 |
| Sub-total | 2,755 | 33,059 |
| Total Operating Costs | 31,472 | 377,663 |
- Production costs assumed 312 days per year with daily capacity of producing 120kgs of printing ink.
- 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.
- Total monthly days assumed are 26-days.
- The valuation currency used is United States Dollars.
Market Analysis
The market for printing ink widely exists with major consumers such as: printeries, educational institutions, public and private offices etc.
Project Product Costs and Price Structure in US$
| Item | Qty/ Day | Qty/Yr | @ | Pdn cost/yr | Unit Price | Total Rve |
|---|---|---|---|---|---|---|
| Printing Ink | 120 | 37,440 | 10.09 | 377,663 | 15 | 561,600 |
Profitability Analysis Table in US$
| Profitability Item | Per day | Per Mnth | Per year |
|---|---|---|---|
| Revenue | 1800 | 46,800 | 561,600 |
| Less: Production and Operating Costs | 121083 | 31,472 | 377,663 |
| Profit | 589 | 15,328 | 183,937 |
Government Facilities and Incentives
There is no VAT charged on raw materials and the government has secured the European Investment Fund which can be accessed by investors