FRUIT SALAD PROCESSING AND VENDING BUSINESS IN UGANDA

By: wmutenza0 comments

Introduction:

This business idea is for making and marketing/vending of fruits. It involves selling varieties of fruits like mangoes, pineapples, paw paws, watermelon, apples and sweet bananas which are bought in large quantities, washed, peeled, cut into pieces and packed in disposable containers to make the fruit salads.

Their market structure and demand is relatively high especially in urban areas.

The business risk involved is healthy and safety related risks surrounding the manufacturing and processing but can be solved by employing food scientists and adhering to a strict safety and hygienic regime

Production Capacity:

Production capacity depends on the capital invested and capital capability. This business idea targets a sale of 250 fruit salads packed in containers per day, which translates into 6,500 packages per month. The revenue potential is estimated at US$200 per day, translating into US$ 62,400 per annum inclusive of a sales margin of 10%. The estimated total investment capital required to establish this project is estimated at US$704. The payback period is about 1 month and the net profit is 26%.

Technology and Process Description:

Fruit vending involves a door to door delivery of services and has no complicated technology involved. Fruit processing is relatively simple because fruits are bought in large quantities, washed, peeled, cut into pieces, mixed and packed into containers in a desired quantities for sale.

Capital Investment Requirements in US$

capital investment requirements
Capital Investment Item Units Qty @ Amount
Refrigerator No 1 400 400
Wrapping machine No 1 210 210
Knives No 4 1 4
Buckets No 5 6 30
Uniforms No 5 12 60
Total 704

Direct Materials, Supplies and Costs in US$ General Costs(Overheads)

Cost Item Units @ Qty/ day Pdn cost/ day Pdn cost/ month Pdn cost/ year
Direct Costs
Mangoes No 0.2 100 20 520 6,240
Sugarcanes No 0.7 10 7 182 2,184
Water mellon No 1.2 10 12 312 3,744
Apples No 0.24 50 12 312 3,744
Pineapples No 0.6 25 15 390 4,680
Pawpaws No 1 25 25 650 7,800
Sweet bananas No 0.04 100 4 104 1,248
Pears No 0.2 50 5 130 1,560
Grapes Kg 3 5 15 390 4,680
Jack fruit. No 2 1 2 52 624
Packing Materials No 0.1 250 25 650 7,800
Sub-total 626 142 3,692 36,114
Utilities (water & Power) 2 52 624
Transport 15 390 4,680
Labour 10 260 3,120
Miscellaneous Costs 5 130 1560
Depreciation (Asset write off) Exp 0.52 13.52 162.24
Sub-total 13 2500 32500 28 845.52 10,146
Total Operating Costs 170 4,538 46,800
  1. Production costs assumed are for 312 days per yearwith a daily capacity of 250 packages of fruit salads.
  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. A production month is assumed to have 26 work days.

Project Product Costs and Price Structure

Item Qty/ day Qty/Yr @ Pdn cost/Yr UPx
Fruit Salads 250 78,000 0.6 46,800 0.8

Profitability Analysis in US$

Profitability Item Per day Per Month Per Yr
Revenue 200 5,200 62,400
Less: Production and Operating Costs 148.27 3,855 46,800
Profit 51.73 1,345 15,600

Market Analysis

There is a high demand in densely populated areas and the Ugandan population is highly sensitized about the use of fruits through radios and other media channels.

 

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