How to Start a Scented Phenyl Manufacturing Business

This business idea is for the manufacturing and marketing of Scented phenyl. Scented phenyl is used as a disinfectant to clean wash basins, toilets, kitchen sinks etc. It is used in residential houses and commercial establishments such as hospitals, offices and shops etc., as a disinfectant and also for some pleasant smell. It is used in most households and other institutions like hotels and thus has good market potential. The business idea is premised on the production of 2,600 litres of scented phenyl per month which translates into 31,200 litres per annum. The revenue potential is estimated at NGN 1,300,000 per month translating into NGN 15,600,000 per annum with a sales margin of 58% and the total investment requirement is NGN 12,527,729 for the first year of project operation.

Production Capacity

The production capacity depends on the number of raw materials and technology used in the production process. But for this case, the plant has a minimum capacity of 31,200 litres of scented phenyl per annum and this is on the basis of 312 working days in a year and 8-hour single work shifts in the working days.

Production Process

The raw materials are weighed and put separately. After preparing the caustic soda solution, required quantities of resin, castor oil, light creosote oil and caustic soda solution, are mixed together in a reactor. After obtaining the final product from the storage tanks, the final product can be packed into bottles and ready for market.

Capital Investment Requirements (CBN exchange rate -$1 to 415.13 NGN) as of 14^thjune 2022.

Capital investment item	Units	Qty	Cost in NGN	Cost in USD
Reaction vessel	No.	1	150,000	361.33
Bottle filler	No.	1	90,000	216.79
Sealing machine	No.	1	50,000	120.44
Storing vessels	No.	3	15,000	36.13
scale	No.	1	10,000	24.09
Total cost of machinery			265,000	638.35

Production and operating costs

Cost Item	Units	@ NGN	Qty/ day	Pdn cost/ month in NGN	Pdn cost/ year In NGN	Pdn cost/ year In USD
Rosin	liters	7,980	25	207,480	2, 489,760	5,997.54
Caster oil	Liters	9,000	12	234,000	2,808,000	6,764.15
Caustic soda	liters	6,000	12	156,000	1,872,000	4509.43
Light creosote oil	liters	15,561	45	404,586	4,855,032	11,695.21
Sub-total		38,541		1,002,066	12,024,792	28,966.33

General costs (overheads)

	Cost Per Month NGN	Cost Per Year NGN	Cost Per Year USD
Utilities(water and power)	3,000	36,000	86.736
Labour	10,000	120,000	289.122
Rent	2,000	24,000	57.824
Fuel	5,000	60,000	144.561
Sub –total	20,000	240,000	578.244
Total Operating Costs	1,022,066	12,264,729	29,544.31

Production is assumed for 312 days per year.
Depreciation assumes 4-year life of assets written off at 25% per year for all assets.
A production Month is assumed to have 26 days.

Project product costs and Price structure

Item

Qty /day

Qty/yr

Pdn cost /yr

NGN

Pdn cost /yr

USD

In NGN

In USD

Scented phenyl

2600

31,200

2500

12,264,729

29,544.31

16,000,000

38,542.14

Profitability Analysis

Profitability Item	Per day	Per month	Per Year NGN	Per Year USD
Revenue	50,000	1,300,000	15,600,000	37,578.59
Less production and operating Costs	38,541	1,022,066	12,264,729	29,544.31
Profit	11,459	277,934	3,335,271	8,034.28

Market Analysis

Market for scented phenyl is growing due to good fragrance and also because of almost the same cost as that of ordinary phenyl.

The wide application in commercial establishments, hospitals, hotels, nursing homes and restaurants, etc., has carved a good market niche for this product.