PROPRIETOR:
BAKING AND FOOD INDUSTRY MULTIPURPOSECOOPERATIVE
TABLE OF CONTENT
CHAPTER ONE
1.0 Introduction ……………………………………………. 1
1.1 Purpose for Establishing the Business ……………… 1
1.2 Description of the product …………………………….. 2
1.3 Profiles of the Company………………………………. 3
1.4 Description of the promoter …………………………. 3
CHAPTER TWO
2.0 Market Analysis ……………………………………….. 4
2.1 Market size……………………………………………… 4
2.2 Market strategy ………………………………………… 5
CHAPTER THREE
TECHNICAL ANALYSIS
3.1 Land and building (shop)…………………………….. 6
3.2 Location of the project ……………………………….. 6
3.2.1 Justification of the business ………………………… 6
3.2.2 Customers profile and benefit ……………………… 7
3.3 Machinery and equipment …………………………… 7
3.4 Annual depreciation of the Equipment …………….. 8
3.5 Raw materials and utilities required ……………….. 9
3.6 Labour and personal requirement …………………. 10
3.7 Sources of start up capital ………………………….. 10
CHAPTER FOUR
4.0 Managerial procedures ………………………………. 11
4.1 Housing and machineries ……………………………. 11
4.2 Sanitation and medication …………………………… 11
4.3 Production processes. ……………………………….. 11
4.4 Costing of the product. ……………………………….. 12
CHAPTER FIVE
5.0 Economic Analysis of the product …………………… 14
5.1 Working capital projection …………………………….. 14
5.2 Total investment cost…………………………………… 15
5.3 Sources of start up capital (table) ……………………. 16
5.4 Conclusion ………………………………………………. 16
5.5 Recommendation ………………………………………. 16
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CHAPTER ONE
INTRODUCTION
The establishment of this bakery works is to obtain the
production, technical, financial demand and supply, marketing and other related
information on the prospect for having a bakery that will serve the state and
beyond. Meanwhile, to get the company (Seed of Hope Baking and Food Industry)
prepare for more great achievement.
This is a comprehensive write-up on
the subject in order to prove, or otherwise state, the economic viability of
the proposed project which is to investigate and report the need to establish one
of the best baking and food industry in this …………… state. to determine the
operational cost and suggest the best cost which is the effective method of
maximizing the expected yield. It is to also determine and report on the
economic commercial and social feasibility of the market project.
1.1 PURPOSE
FOR ESTABLISHING THE BUSINESS A
Many bakery companies may have their own different purpose
for running the business, but to me,
(i)
I want to make a different even
among many in my production.
(ii) To
produce bread and foods to the people of Ebonyi state and other state.
(iii) The
company will create job opportunity to Nigerian citizens.
(iv) The
company will stand as a help to the needy
(v) Another
purpose for establishing the business is to prosper the company and making gain
as well.
(vi) As
regard to the place I want to establish the business, that is .........................
where there is no bakery industry, in that case, I want to bring it nearer to
the people of ......................... and ..........................
(vii) To have
a compressive feasibility study on the subject matter, to prove or otherwise
state the economic viability of the proposed project,
(viii) The
establishment will improve the consumption and be of great nutritional value to
the consumer as well.
1.2 DESCRIPTION OF THE PRODUCT
The
proposed project will involve mainly, bread making snacks, chin-chin, and other
food produce like fried chicken, fried rice, indiome etc.
Therefore bread, snacks, chin-chin will be produced from
the flour in which sugar will also be added to it. This produce is classified under
fats food which supplies oil to the body. It will always be packaged in a
selophin (ie sachet bags) after passing through the baking processes. Other
food produce should always be served based on how the customer wants it, other
he/she to be taken it right there or it should be packaged for the customer in
a take away materials.
The availability of the raw materials and its
substitute in producing these goods and services are found in some parts of
this Ebonyi state, I mean the main distributor of flour is located in this
Ebonyi state that is Santa Maria, flour and sugar etc. distributor. .........................
main market is another source of the company raw materials like groundnut oil
as one of the raw material will be gotten from also in .........................
main market.
1.3 PROFILES
OF THE COMPANY (INDUSTRY)
Seed of Hope Baking and food industry is a liability company.
The Head office of the company is located at ………….. Community ………. L.G.A, ………
state Nigeria.
The industry is authorized to engage in bread and
other food production.
The industry sources her capital for investment from
both the industry and his intermediate relative. The industry as a liability
company, can sell her shares on the stock exchange market, and it has never for
once obtain loan of any sort of any financial institution.
1.4 DESCRIPTION
OF THE PROMOTER
The promoter of this project is Mr. A from …………… Local
Government Area of ………….. State.
I learnt this baking food production industry in Est food
industry ……………. (THIS IS A SAMPLE: 2st avenue Gwarinpa Estate
ll Abuja and Devalo baking and food
industry, Daban avenue off Sabongari road Bwari Abuja, Near Trem church). The training
I had with the company leaves no doubt about my ability to succeed in the
proposed project. I was trained as a baker, mixer, operator, cutter, table man,
even the idea as a sales manager, all this areas, I was first received the training
from Emu Bakery.
CHAPTER TWO
2.0 MARKET
ANALYSIS
The main purpose of production is
for marketing (for sale). The analysis of the market potentials of the project
is therefore critical to the success of any investment. This market analysis
will be discussed under two different heading as follows: the market size and
marketing strategy.
2.1 MARKET
SIZE
The market size of the project will
includes all the people who buys, sells, or makes use of bread and our food
product.
For the fact that there is no such
establishment particularly in ........................., the market size will
include ........................., …………. And ………….., also .........................
capital city. Others who need the services of the equipments for their own
production will also be given the services and hences constitute parts of the market
for the equipment services.
As the business progresses, the
promoter has it in mind to extend the market frontier to other neighbouring
cities such as ........................., …………. And ………….., also .........................
etc. These commercial cities has the
potentials for high demand for the product due to the combined factors of high
population and high income level.
2.2 MARKET
STRATEGY
Seed of Hope Baking and food
industry will ensure a high quality product and services to its prospective numerous
customers. This will be achieved by the recruitment of competent and qualified
staffs. Good quality of machinery, equipment and raw material will also reflect
high standards and quality available in the market so as to maintain the
envisaged to quality standard. Though the pricing policy will be competitive,
but penetration strategy of pricing will be adopted, so as to attract more
customers.
CHAPTER THREE
TECHNICAL ANALYSIS
3.1 LAND
AND BUILDING (SHOP)
The promoter will construct a factory structure in a
plot of land for the project, hence the land has be gotten. He has also gotten
the vehicle he will use in transacting the business raising of the structure is
estimated at a cost
3.2 LOCATION
OF THE PROJECT
The location of the business project
is proposed to be situated at ......................... community near .........................
market. It is chosen to be there because
of the areas the business want to be covering and for easy accessibility to the
prospective numerous customers.
3.2.1 JUSTIFICATIONS
OF THE BUSINESS
The people of .........................
and ......................... is blessed with a good marketer (business men) of
different areas, but those into the business of selling bread, snacks and even
chin-chin finds it very difficult to get
it, thereby traveling all the way form ........................., .........................
to the capital city in order to get them (those goods). It is an this note,
that the promoter discovers what they passes through in transacting the
business and deems it necessary to sort out the problem in their land thereby
putting a stop to it by having it in mind to established such industry in that
particular part of the state.
Also there are some in the state
that would have been in flour supply but for the fact that much people are not
into bakery production business, they withdraw themselves from such. In that
case also, the establishment of this project will enhance more distributors of
flours into the state and also energize their motivation. There are some of
other advantages attached to this project which include;
- employment opportunities: the establishment of this project has it in
mind to provide Job opportunities for a
good number of Nigerian youths who will be engaged in the production processes.
- Source of revenue: Government will
benefit from the business through the business tax and personal income tax by
the employees of the project.
3.2.2 CUSTOMER
PROFILE AND BENEFIT
The products from the industry will
be focused mainly in Ebonyi State as its main point of disposal and consumption
since Ebonyi State towns are predominantly civil servants, in habited towns.
3.3 MACHINERY
AND EQUIPMENT
The machineries and equipments
required by the project and their prices includes;
|
S/N
|
Items
|
Details(Description)
|
Qty
|
Unit cost
|
Amount
|
|
1
|
Industrial
oven
|
Fire
wood oven
|
1
|
800,000
|
800.000
|
|
2
|
Lister
|
8
HP lister Engine
|
1
|
150,000
|
150,000
|
|
3
|
Milling
machine
|
To
be constructed
|
1
|
120,000
|
120,000
|
|
4
|
Slicing
machine
|
-
|
2
|
120,000
|
120,000
|
|
5
|
Working
table
|
Production
table and slicing table machine
|
2
|
15,000,00
|
30,000
|
|
6
|
Mixing
machine
|
|
1
|
3,000
|
300,000
|
|
7
|
Scale
|
|
1
|
3,000
|
3,000
|
|
8
|
Paddle
|
|
2
|
2500
|
5,000
|
|
9
|
Baph
|
|
1
|
8000,00
|
8,000
|
|
10
|
Pans
|
|
As
may be required
|
200,000
|
200,000
|
|
11
|
Knives
|
|
2
|
200
|
400
|
|
12
|
Cutter
|
|
1
|
400.000
|
400,000
|
|
13
|
Water
tank
|
|
1
|
15,000
|
15,000
|
|
|
|
|
|
2133700
|
2151400
|
3.4 Raw
Materials and Utilities Required
|
S/N
|
Items
|
Details(description)
|
Unit
cost
|
Amount(
|
|
1
|
Flour
|
20
bags
|
N7,300.00
|
146,000.00
|
|
2
|
Sugar
|
21/2
bags
|
7,800.00
|
19,500.00
|
|
3
|
Butter
|
2
cartons
|
4,200.00
|
8,400.00
|
|
4
|
G/Nut
oil
|
1
gallon
|
5,200.00
|
5,200.00
|
|
5
|
Salt
|
10
sachet
|
50
|
500.00
|
|
6
|
Yeast
|
5
sachet
|
350
|
1750
|
|
7
|
Baking
powder
|
1
tin
|
1300
|
1300
|
|
8
|
E.D.C
|
1
gallon
|
17,000
|
17,000
|
|
9
|
Kenas
improver
|
5
sachet
|
600
|
3000
|
|
10
|
Milk
|
10
sachet
|
450
|
4500
|
|
11
|
Flavours
|
4
lits of gallon
|
2500
|
10,000
|
|
12
|
Honey
|
4
lits
|
500
|
2000
|
|
13
|
Curant
fruit
|
5
sachet
|
500
|
2,500
|
|
14
|
Eggs
|
10
crates
|
750
|
7500
|
|
15
|
Water
|
20
gallons
|
30
|
600
|
|
16
|
Nut
megg
|
20
pieces
|
30
|
600
|
|
17
|
Fire
wood
|
|
5,000
|
5,000
|
|
18
|
Diesel
oil
|
20 litres
|
160
|
3200
|
|
19
|
Engine
oil
|
10
lits
|
500
|
5000
|
|
20
|
Electricity
|
Per.
Month
|
2,000
|
2,000
|
|
21
|
Car
fueling
|
50
litres
|
100
|
5,000
|
|
22
|
Land
|
1plot
|
500,000
|
500,000
|
|
23
|
Building
|
|
500,000
|
500,000
|
|
24
|
Nylon
/ label
|
|
15.00
|
1,500.00
|
|
|
|
|
1,056,335.00
|
1,252,050.00
|
3.5
LABOUR AND PERSONAL REQUIREMENTS
The
company is going to have the following workers for a start as seen in the table
below;
|
S/N
|
Items
|
No
|
Wages
|
Amount(
|
|
1
|
Manager/supervisor
|
1
|
20,000
|
20,000
|
|
2
|
Machine
operator
|
1
|
12,000
|
12,000
|
|
3
|
Production
assistant
|
3
|
7,000
|
21,000
|
|
4
|
Marketers
|
2
|
7,000
|
14,000
|
|
5
|
Driver
|
1
|
15,000
|
15,000
|
|
6
|
Security
|
1
|
7,000
|
7,000
|
|
7
|
baker
|
1
|
15,000
|
15,000
|
|
|
|
|
83000.00
|
104000.00
|
3.6 ANNUAL
DEPRECIATION OF THE EQUIPMENT
|
S/N
|
Items
|
Cost
(
|
Useful
life(years)
|
Amount(
|
|
1
|
Industrial
ovun
|
800,000.00
|
20
|
150,000
|
|
2
|
lister
|
150,000.00
|
10
|
50,000.00
|
|
3
|
Milling
machine
|
120,000.00
|
15
|
40,000.00
|
|
4
|
Slizing
machine
|
30,000.00
|
8
|
20,000.00
|
|
5
|
Working
table
|
30,000.00
|
10
|
3,000.00
|
|
6
|
Mixing
machine
|
3,000.00
|
20
|
100,000.00
|
|
7
|
Scale
|
3,000.00
|
2
|
200.00
|
|
8
|
Peddle
|
5,000.00
|
2
|
100.00
|
|
9
|
Baph
|
8,000.00
|
10
|
1000.00
|
|
10
|
Pans
|
200,000.00
|
4
|
10,000.00
|
|
11
|
Knives
|
400.00
|
3
|
50.00
|
|
12
|
Cutter
|
400,000.00
|
10
|
50,000.00
|
|
13
|
Water
tank
|
15,000.00
|
5
|
2,000.00
|
|
|
|
2151400
|
|
626150.00
|
3.7 SOURCES
OF START UP CAPITAL
The project will be financed by the
following body
|
s/n
|
Sources
|
Amounts
|
Percentages
|
|
1
|
Owners
equity ie personal fund
|
N500,000.00
|
79
|
|
2
|
Cooperative
fund
|
N412,3000.00
|
67
|
|
3
|
Loan
|
N2,000,000.00
|
150
|
|
|
Total
|
N2,912,300.00
|
296
|
CHAPTER FOUR
4.0
MANAGERIAL PROCEDURES
For maximum productivity to be
attained from this proposed business, good management should first be in mind
and an effort made to achieve that.
4.1 HOUSING
AND MACHINERIES
Considering
the environment in which the project is to be situated, the house should be
well built with a proper size. it must be well fenced for security purpose. As
regard to the machineries, the company will be established with a recommended
machineries and equipment, to avoid any disappointment during production.
4.2 SANITATION
AND MEDICATION
The company being a place where food
is being manufactured, I will ensure the hygienic nature of the environment,
for attracting customers. The medication aspect, all my product must be free from
all, which the NAFDAC did not approve, to ensure cordial relationship with the
NAFDAC.
4.3
PRODUCTION PROCESSES
The
processes of producing the products proposed in the project are shown
diagrammatically in the figure below flourà ingredientsà mixingà millingà cuttingà moldingà turningà bakingà packagingà distribution.
(a) Fig. 1: flow diagram for bread production
Flour à ingredients à creaming à portioning à baking à packaging à distribution.
(b) Fig. 2:
flow diagram for cake production
flour à ingredients à mixing à millingà cutting à frying à packaging à distribution.
(c) Fig. 3: flow diagram for chin-chin
production
Flour à ingredients à mixing à nodding à fillingà bakingà packaging à distribution
(d) Fig 4. Flow diagram for snacks production
4.4 COSTING
OF THE PRODUCT
The establishment will mainly base on the production
of bread, chin-chin, snacks and other food produce. In this write-up, we are
going to observe the costing big loaves of bread, chin-chin, snacks.
COSTING OF BIG LOAVES OF BREAD
|
Raw material
|
Buying cost
|
Qty per item big loaves of bread
|
Cost per item
|
|
Flour
|
73
|
-
|
73
|
|
Label
|
07
|
=
|
07
|
|
Packing
leather
|
15
|
-
|
15
|
Costing
of chin-chin
|
Flour
|
73
|
-
|
73
|
|
Packaging
leather
|
02
|
-
|
02
|
|
|
|
|
75
|
COSTING OF SNACKS
|
Flour
|
73
|
-
|
73
|
|
Packaging
leather
|
02
|
-
|
02
|
|
|
|
|
75
|
CHAPTER FIVE
5.0 ECONOMIC
ANALYSIS OF THE PRODUCTS
A critical analysis of the economic
viability of the business project will be on focus.
5.1 WORKING CAPITAL PROJECTION
The working capital requirement of the project is
estimated for a period of one week as stated below;
|
S/N
|
Items
|
Qty
required
|
Unit
cost
|
Amount(
|
|
1
|
Flour
|
20
bags
|
N7,300.00
|
146,000.00
|
|
2
|
Sugar
|
21/2
bags
|
7,800.00
|
19,500.00
|
|
3
|
Butter
|
2
cartons
|
4,200.00
|
8,400.00
|
|
4
|
g/nut
oil
|
1
gallon
|
5,200.00
|
5,200.00
|
|
5
|
salt
|
10
sachet
|
50
|
500.00
|
|
6
|
Yeast
|
5
sachet
|
350
|
1750
|
|
7
|
Baking
powder
|
1
tin
|
1300
|
1300
|
|
8
|
EDC
|
1
gallon
|
17,000
|
17,000
|
|
9
|
Kimas
improver
|
5
sachet
|
600
|
3000
|
|
10
|
Milk
|
10
sachet
|
450
|
45000
|
|
11
|
Flavours
|
4
lits of gallon
|
2500
|
10,000
|
|
12
|
Honey
|
4
lits
|
500
|
2000
|
|
13
|
Corant
fruit
|
5
sachet
|
500
|
2,500
|
|
14
|
Eggs
|
10
crates
|
750
|
7500
|
|
15
|
Water
|
20
gallons
|
30
|
600
|
|
16
|
Nut
megg
|
20
pieces
|
30
|
600
|
|
17
|
Fire
wood
|
|
|
5000
|
|
18
|
Diesel
oil
|
20 litres
|
160
|
3200
|
|
19
|
Engine
oil
|
10
lits
|
500
|
5000
|
|
20
|
Electricity
|
Per.
month
|
2,000
|
2,000
|
|
21
|
Car
fueling
|
50
litres
|
100
|
5,000
|
5.2 TOTAL
INVESTMENT COST
|
s/n
|
Items
|
Amount(N)
|
|
1
|
Preliminary
expenses i.e business Reg
loan
application, producing of feasibility report.
|
10,350.00
|
|
2
|
Project
building
|
500,000.00
|
|
3
|
Machinery
and equipment
|
2,151,400.00
|
|
4
|
Working
capital
|
250,550.00
|
|
|
Total
|
2,912,300.00
|
5.3 CONCLUSION
Taking off from the raw material list above analytical
indication of the enterprise using taken off budgeting, cash, costing of the
product, the analysis, benefit, present worth and internal rate of return
confirmed this. This project has a very high internal rate to return even at
rate higher than what is charged for agricultural loan.
The value of the expected revenue of the each year of
operation is reasonable hence debt repayment will not be difficult.
5.4 RECOMMENDATIONS
The credit institution is advised to
grant the loan amount requested by the promoter to enable her realize the dream
of the project.
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