This business idea is for the production and marketing of low dust chalk. Chalk is a soft compacted whitish calcite used as a writing aid in educational institutions. Low dust chalk reduces health hazards that result from excess chalk dust. Chalk’s market structure cuts across academic institutions and can also be produced in a wide range of colours though white chalk is most preferred. Hence, this business idea aims at the production of 2,000 boxes of chalk per month. The revenue potential is estimated at NGN 48,000,000 per year with a sales margin of 10% while the total capital investment for the project is NGN 460,000.
White Chalks on a Black Background
Production Capacity
The profiled plant has a minimum capacity of 100 boxes of chalk per day and each box normally has 100 chalk pieces.
Process of Production
To produce chalk, Plaster of Paris, French chalk and kaolin are mixed and made in a form of paste. The paste is cast in a suitable mould and dried. The dried material is then neatly packed for the market.
Capital Investment Requirements (CBN Exchange rate – $1 to NGN 380) as of 29th of April, 2021)
| Capital Item | Qty | Price Per One NGN | Amount (NGN) | Amount (USD) |
| Oven | 1 | 300,000 | 300,000 | 790 |
| Moulds | 5 | 30,000 | 150,000 | 395 |
| Vessels | 10 | 1000 | 10,000 | 6 |
| Total | 460,000 | 1,211 |
Operation and Production Costs
| Cost Item | Units | Unit Cost NGN | Qty/ Day | Pdn Cost/Day NGN | Pdn Cost/Mth NGN | Pdn Cost/Year NGN | Pdn Cost/Year USD |
| Direct Costs: | |||||||
| Plaster of Paris | Bags
(50kgs) |
5500 | 8 | 44,000 | 880,000 | 10,560,000 | 27,790 |
| French Chalk | Bags
(50kg) |
2300 | 5 | 11,500 | 230,000 | 2,760,000 | 7,263 |
| Kaolin | Kgs | 5000 | 3 | 15,000 | 300,000 | 3,600,000 | 9,474 |
| Binder | Kgs | 6500 | 3 | 19,500 | 390,000 | 4,680,000 | 12,316 |
| Packaging materials | Pieces | 50 | 60 | 3000 | 60,000 | 720,000 | 1,895 |
| Total | 22,320,000 | 58,737 | |||||
General costs (Overheads)
| Cost Per Month NGN | Cost PerYear NGN | Cost PerYear USD | |
| Salaries and Wages | 32,000 | 384,000 | 1,011 |
| Utilities | 2,000 | 24,000 | 63.2 |
| Selling and Distribution | 30,000 | 360,000 | 947.4 |
| Administrative Expenses | 20,000 | 240,000 | 686 |
| Rent | 4,000 | 48,000 | 126 |
| Depreciation (Asset Write off Expenses) | 10,000 | 120,000 | 316 |
| Sub-Total | 97,500 | 1,170,000 | 3,097 |
| Total Operating Costs | 165,500 | 1,986,000 | 5,226.3 |
- Production is assumed for 240 days per year.
- Depreciation assumes a 4-year life of assets written off at 25% per year for all assets.
- A production Month is assumed to have 20 workdays.
Project Product Costs and Price Structure
| Item | Qty/Day | Oty/Yr | Unit Price | TR/YR NGN | Total Revenue(USD) |
| Chalk boxes | 100 | 24,000 | 2,000 | 48,000,000 | 126,316 |
Profitability Analysis Table
| Profitability Item | Revenue Per Year NGN | Per Year
Revenue Per Year USD |
| Revenue | 48,000,000 | 126,316 |
| Less Prod & Operating Cost | 24,306,000 | 63,963 |
| Profit | 23,694,000 | 62,353 |
Sources of Equipment Supply
All materials needed can be got locally at fair prices.
You can also view other business ideas like HOW TO START A JEWELLERY MAKING BUSINESS, HOW TO START A BEEKEEPING (APICULTURE) BUSINESS, and so on here.
