Air fresheners are consumer products that mitigate unpleasant odors within indoor spaces. They can be in form of candles, sprays and gel and can also be used as a deodorant. They are an item that both household and public offices can’t seem to do without. The freshener is also commonly used in both public and home toilets.
The production capacity is estimated at 200 pieces per day, monthly production of 5,200 pieces and annual production of 62,400 which yields the TR NGN 31,200,000 per year, leading to net profit margin of 27% and payback period of 8 months.
Production Process
Air freshener cake is made out of Para dichlorobenzene, colour and perfume. These ingredients are properly mixed and moulded by using the fly press. The resulting gel of the freshener is packed to avoid the absorption of moisture, which weakens the freshener.
Capital Investment Requirements (CBN exchange rate -$1 to 415.40 NGN) as of 17th July 2022.
Capital investment item | Units | Qty | Cost in
NGN |
Cost in USD | |
Drum mixer | No. | 1 | 10,000 | 24.073 | |
Bucket with Weighing scale | No. | 3 | 6000 | 14.444 | |
Packaging materials | No. | 1,500 | 15,000 | 36.109 | |
Total cost of machinery | 31,000 | 74.627 |
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 |
Paradichlorobenzene
|
kgs | 40,000 | 100 | 1,040,000 | 12,480,000 | 30,043.332 |
Perfume Color | kgs | 10,000 | 10 | 260,000 | 3,120,000 | 7510.833 |
Sub-total | 50,000 | 1,300,000 | 15,600,000 | 37,554.165 |
General costs (overheads)
Cost Per Month
NGN |
Cost Per Year
NGN |
Cost Per Year
USD |
|
Utilities(water and power) | 3,000 | 36,000 | 86.665 |
wages | 10,000 | 120,000 | 288.878 |
Sub –total | 13,000 | 156,000 | 375.542 |
Total Operating Costs | 1,313,000 | 15,756,0000 | 37,929.706 |
- 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 |
TR
In NGN |
TR
In USD |
Air freshener | 200 | 62,400 | 500 | 15,756,000 | 37,929.706 | 31,200,000 | 75,108.329 |
Profitability Analysis
Profitability Item | Per day | Per month | Per Year
NGN |
Per Year
USD |
Revenue | 100,000 | 2,600,000 | 31,200,000 | 75,108.329 |
Less production and operating Costs | 50,000 | 1,313,000 | 15,756,000 | 37,929.706 |
Profit | 50,000 | 1,287,000 | 15,444,000 | 37,178.623 |
Market Analysis
With increasing population and the need for improved living conditions, the demand for air freshener is also gradually increasing. The growing hygiene consciousness has attracted attention to this product. Hence, there is ready market in urban areas. Areas of target are: supermarket chains, retail shops, restaurants, hotels and tourist centers.
Sources of Raw Materials and Equipment
Raw materials are readily available in markets in the chemicals industry and equipments are available in the market.