STARTING A BUSINESS MAKING MATS IN UGANDA

By: wmutenza0 comments

Introduction

This business idea is for production and marketing of Palm leaves mats. Mats are popular in homes and are widely used among all sections of the society. Thus, mat making is a good investment that can easily be taken up by women. The production capacity per day is estimated at 30 Mats and the revenue is estimated at US$37,440 per year with a net profit of 37%.

Production process

Mat making involves collecting palm leaves, drying it in preffered colors and finally weaving the palm leaves into different kinds of Mats. They can be made with threads, which are dried and sewed with a needle.

Capital Investment Requirements in US$

Capital investment item Units Qty @ Amount
Sewing needle No. 5 5 25
Knives No. 5 1 5
Basins No. 10 2 20
Total Cost 45

Production and Operating costs in US$

Cost Item @ Qty/ day Pdn cost / day Pdn cost/ month Pdn cost/ year
Palm leaves 0.6 100 60 1,560 18,720
Colors(kg) 0.5 6 3 69 828
Sub-total 1,629 19,548

General costs

Utilities(water and power) 26 312
Labour 100 1200
Rent 60 720
Miscellaneous costs 20 240
Distribution costs 130 1,560
Depreciation) 1 12
Sub -total 337 4,044
Total Operating Costs 1,966 23,592
  1. Production costs assumed 312 days per year with a daily capacity of 30 mats
  2. Depreciation (fixed assets 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.

Project product Costs and Price Structure

Item Qty/day Qty/yr @ Pdn cost /yr UPx TR
Mats 30 9,360 2.19 23,592 4 37,440

Profitability Analysis

Profitability Item Per day Per month Per Year
Revenue 120 3,120 37,440
Less production and operating Costs 75.6 1,966 23,592
Profit 44.4 1,154 13,848

Market Analysis

Mats are ideal for use in aisles of homes parties and mosques. These therefore form the market.

Sources of Raw materials:

Raw materials can be sourced locally.

Government Facilities and Incentives

The government has got incentives for those who are involved in the manufacturing sector as a bid to encourage setting up small and medium enterprises. Soft loans and grants are available in banks and other financial organizations for industrialists.

 

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