Introduction
This business idea is for the production and marketing of Palm leaves Mats. They are popular in homes and are widely used among all Sections of society. Thus, making it a good investment that Can easily be taken up. The production capacity per day Is estimated at 30 and the revenue is estimated at NGN 5,400,000 Per year with a net profit of 37%.
Production Process of Mat
The process involves collecting palm leaves, drying them in preferred 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 (CBN exchange rate -$1 to 414.95 NGN) as of 21 Jan 2021.
| Capital investment item | Units | Qty | Price per one | Cost in
NGN |
Cost in USD |
| Sewing needle | No. | 5 | 200 | 1000 | 2.409 |
| Knives | No. | 5 | 200 | 1000 | 2.409 |
| Basins | No. | 10 | 400 | 4000 | 9.639 |
| Total cost | 6000 | 14.459 |
Production and operating costs in Naira and USD
| Cost Item | Units | Qty/
day |
@ In NGN | Pdn cost/ month in NGN | Pdn cost/ year
In NGN |
Pdn cost/ year
In USD |
| Palm leaves | kg | 0.6 | 3000 | 90,000 | 1,080,000 | 2,602.723 |
| Colors | (kg) | 0.5 | 2500 | 75,000 | 900,000 | 2,168.936 |
| Subtotal | 5,000 | 165,000 | 1,980,000 | 4,771.659 |
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General costs (overheads)
| Cost Per Month
NGN |
Cost Per Year
NGN |
Cost Per Year
USD |
|
| Utilities (water and power) | 2000 | 24,000 | 57.838 |
| Labour | 5000 | 60,000 | 144.595 |
| Rent | 1500 | 18,000 | 43.378 |
| Miscellaneous costs | 3000 | 36,000 | 86.757 |
| Total Operating Costs | 11,500 | 138,000 | 332.570 |
- Production costs assumed 312 days per year with a daily capacity of 30.
- Depreciation (fixed assets 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
Project product costs and Price structure
| Item | Qty /day | Qty/yr | @
NGN |
Pdn cost/yr
NGN |
Pdn cost /yr
USD |
TR
In NGN |
TR
In USD |
| mats | 30 | 10,950 | 500 | 2,122,000 | 5,113.869 | 5,400,000 | 13,013.616 |
Profitability Analysis
| Profitability Item | Per day | Per month | Per Year
NGN |
Per Year
USD |
| Revenue | 15,000 | 450,000 | 5,400,000 | 13,013.616 |
| Less production and
operating Costs |
5000 | 165,000 | 1,980,000 | 4,771.659 |
| Profit | 10,000 | 285,000 | 3,420,000 | 8,241.957 |
Market Analysis
Mats are ideal for use in aisles of homes, parties, beaches, and mosques.
These, therefore, form the market.
Sources of Raw materials:
Raw materials can be sourced locally.
