39

1. INTRODUCTION

Diapers were invented in the 1930s, the product has continuously improved.
Different types of diapers manufactured around the globe include cloth
diapers, disposable diapers, training nappies, swim pants and biodegradable
diapers. Today’s disposable diaper is light, compact, very absorbent,
resistant to leaks and easy to use. In Ethiopia, too, the trend of using mass
produced diapers for babies is becoming common. However, the percentage
of diaper users stands at only five percent in Ethiopia, while in Kenya,
diaper users are more than 70 percent of the population.

The value of the baby diaper market is estimated to be worth approximately

70.4 billion dollars worldwide by 2024. This is an increase of over 20 billion
dollars over the eight-year forecast period. Disposable baby diapers lead the
diaper market, holding around 65 percent of market share. North America
and Europe together account for more than 50 percent of the global volume
of diapers consumed; attributed to the availability of improved raw materials
and technological advancements in markets in various regions across the
globe.

Global Diaper Market Size by Product

 39

Ethiopia offers investors a wide array of opportunities by abundant natural

resources, land, livestock population, minerals and a population of more
than 110 million and with a growth rate of 3.09% each year potential
consumers are just some of its key advantages. Consequently, the living
standard of the community is continuously improving, which provides a high
potential market for infants and children to be served. The steep increase in
growth rate provides a higher demand for purchasing hygienic disposable
products. Previously, many local families have been using imported diapers,
but these days they are starting to use locally-produced items. In 2017
Ethiopia imported 4.9 million kilograms of diapers from China, Turkey and
Egypt. The healthy growth rate is driven by factors such as millions of
babies born per year, higher disposable incomes and the increased hygiene
awareness of Ethiopian mothers.

In Ethiopia, as in other parts of the world, baby hygiene uses either

disposable or reusable diapers. But disposable diapers are generally
expensive (about 600 ETB per pack of 100 diapers) and available mostly in
urban areas. As a majority of Ethiopian babies are in rural areas they use
normal cloth diapers because of high cost and non-availability of disposable
diaper. Based on the fact that a baby uses 4-8 diaper in a day the average
expense amounts to about 30 ETB. Hence, there is a need for a cheaper
alternative.

We are on the verge of entering a lucrative market in a growing country. The

current population fertility rate estimated at 4.2 children and increased
admissions in hospitals and clinics presents an opportunity for our baby
diapers to enter and penetrate the diapers market. Our factory is poised to
take advantage of this growth rate and minimal local competition, with a
dedicated and experienced staff, excellent order procurement, and effective
management and marketing. The initial intention will be to provide diapers
pads to institutions and organizations including hospitals and wholesalers
throughout Ethiopia.
 39

Currently the owner of this project is engaged in different business sectors in

the country, and now he is planning to invest here on the disposable diapers
factory. So this feasibility study is prepared as per his request and is only
used only for this purpose and it represent for giving a clue that if he invest
in this sector he will benefit more and also help him to see and expand his
investment in the country.

2. Executive Summary
This section contains the basic concept that the promoters is attempting to
develop in the year 2021. All the necessary information that deserves to be
mentioned is included in this section.
2.1 Cardinal issues
2.1.1. Mission
“The owner's goal is to invest in quality both in its properties and in its
customer. Learning from the shortfalls of the existing plant of the same kind in
the country, the owner plans to reach full capacity within a short time and
expand his business with customer demand.”
2.1.2. Vision
“To leading industrial producer and investment activities in general and in the
production of quality disposable diapers products. This will be achieved by
becoming a multifaceted company committed to providing maximum customer
satisfaction.”
2.1.3 Objective
2. 1.3. 1 General Objective:
“The main objective producing of disposable diapers product project is to
creating self-job and ensuring sustainable income earning by providing customer
targeted products.”
2. 1.3.2 Specific Objectives:
The company also profit maximization is not the end objective by itself. The
owner also will run its business with the following specific objectives:
 39

To increase market share by delivering quality product and service for

potential customers.
To contribute and strengthen the development of the industrial sector,

To save foreign currency by way of import substitution i.e by boosting local

supply.
To provide alternative source of income to share orders of the project .
Invest in this untapped business venture in the country where there is a
minimum risk of loss
Satisfy the short fall of the demand not only on urban areas but also rural
areas of the country
2.2. Major investment incentives
To encourage private investment and promote the inflow of foreign capital and
technology into Ethiopia the following incentives are granted to investors (both
domestic and foreign) engaged in establishment of new enterprise and expansion
in areas qualified for investment incentives.
One hundred percent exemption from payment of import customs duties
on items such as plant, machinery, equipment, etc, plus spare parts worth
up to 15% of the value of the imported investment capital goods.
Investment capital goods imported may be transferred to another investor
enjoying similar privileges.
The duty drawback scheme applies to all taxes at the time of importation,
and those paid on local purchases.
2.3. Business Description
The project is a newly formed private company for purposes of establishing a
new factory. The aim of the firm is produce the type of quality disposable diapers
product to earn profit and fill the demand of the society.
 39

DESCRIPTION OF THE FACTORY

Name of the business: FF Disposable Diapers Factory

Location of the business: Addis Ababa, Bole sub city, Woreda 10

Telephone NO: +251 911 52 26 72

E-mail: weselassiei@yahoo.com

The project is wholly owned by Ato Werkenh Fekadeselassie for the purpose of
establishing manufacture and sell disposable diapers factory. The project is
intended to bridge the huge demand and supply gap of this disposable diapers
product in the country.

The company is to be formed as a sole proprietorship with a total capital of Birr

25,858,110.00. It will be contributing their part towards the development of the
country by actively participating in value adding business activities. Their
establishments are also instrumental in enhancing the government’s capacity
building efforts principally in the industrial sector.

The startup cost of the business will be Birr 25,858,110.00 from the total initial
capital, Accordingly it is proposed that 61% of investment on machinery, raw
material and other listed will be contributed from own equity and the remaining
39% will be secured from bank in the form of medium term investment loan at
16.75% interest rate for 5 years in quarterly base. These funds are goes to
starting the business and to cover operating expense of the first manufacturing
period. The confidence that the company is almost assured because the
enterprise’s members of the group are well trained in business activity which
gave them the ability to manage and lead the firm in excellent way.
2.5 SWOT Analysis
SWOT stands for strengths, weakness, opportunity and treats. A SWOT analysis
is a method of strategic planning that evaluates these four elements on relate to
our business objective. This can help to demonstrate our marketing strategy.
 39

2.5.1. Strength
Relationship selling: We intend to get to know our customers, one on
one. Our direct sales efforts will seek to maintain a relationship with
our customers.
Diversified customer base: We intend to obtain orders for our
products from a wide customer base. This will ensure lack of
dependency on one customer.
Low production costs: The costs of our products will be
approximately a third less than the famous brand names and end user
prices.
2.5.2. Weakness
A limited financial base compared to our country counterparts.
The introduction of new organisational practices and personnel who
have not previously worked together presents a challenge to the
organisation.
Our infancy dictates that wholesalers and other intermediaries might
be skeptical about our products.
2.5.3. Opportunity
Service as our intended target markets is in relatively accessible areas
we intend to be able to meet their requirements in the shortest
possible time.
Current drive by government towards encouraging the participation of
indigenous entrepreneurs and diversification of the economy presents
an opportunity that we may fully utilize.
Presently there are few reliable local manufacturers of disposable
diapers, with less than a handful currently on the market.
There also loan opportunity since government is more invested in
companies who invest in manufacturing sector. It gives loan priority to
the manufacturing sector.
 39

2.5.4. Threats
The “Foreign is good, local is poor” belief may present a difficult hurdle
to be overcome.
Existing competition both local and foreign; wholesalers and
institutions may express satisfaction with their current diapers
product.
The possibility of other start up diaper product manufacturer
companies; generated by healthy economic growth establishing in the
market.
Some raw materials are not found locally. So they should be imported
and since the country rate of export over import is low there might be
a problem of foreign currency.

2.6. The Product Description

Disposable diapers are a great convenience in the modern world. A disposable
diaper consists of an absorbent pad sandwiched between two sheets of
nonwoven fabric. The pad is specially designed to absorb and retain body fluids,
and the nonwoven fabric gives the diaper a comfortable shape and helps prevent
leakage. The disposable diapers, an invention that revolutionized the baby care
industry, exist today as a practical solution to the problem of dirty, smelly, wet
baby bottoms throughout the world. These diapers are made by a multi-step
process in which the absorbent pad is first vacuum-formed, then attached to a
permeable top sheet and impermeable bottom sheet. The components are sealed
together by application of heat or ultrasonic vibrations. Elastic fibers are
attached to the sheets to gather the edges of the diaper into the proper shape so
it fits snugly around a baby's legs and crotch. When properly fitted, the
disposable diaper will retain body fluids which pass through the permeable top
sheet and are absorbed into the pad.
Out of the total product, the company is targeted to sell 60% of the diaper to
infants with the age of up to four years. The target group for children is
segmented based on their weights in a kilogram and age.
 39

With the objective of introducing the wide usage of such product in Ethiopia,
this project has planned to produce disposal diapers available for infants and
children that weight from 2kg to 17kg or from age 0 to 4 years old and the target
group for adults includes adults who have incontinence issues.
2.7. Technical and Technology Study
The machine responsible for the manufacturing process is a new and unique
concept. It is capable of producing different sized diapers, that is, small, medium
and large geriatric/adult and sanitary pads. It is capable of producing 350+/-
diapers per minute.
The one certainty in our industry is that technology will continue to evolve and
develop, changing the quantity that can be produced at any one time, as well as
its quality. Our aim will be to be aware of the implications of this new technology
and utilize it in our existing framework where possible. However our initial aim
will be to pay back the initial cost of the machine.

2.7.1.1. Technical Parameter of Diaper Machine

Processing Type: Semi Servo Baby Diaper Machine
Place of Origin: Fujian, China
Brand Name: WellDone
Certification: CE
Computerized: Yes
Product Type: Disposal Baby Diaper
Production efficiency: 300-350pc/min
Power Supply: 3 phase, 5 Wires (380v, 50HZ)
Machine Size: 27m*9*5 (L*W*H)
Machine Weight: 50 Tons
Heating power: 200kw
Packaging Details: Export standard packing
Delivery Detail: 90days after receive 50% deposit by TT
 39

Fig: Semi Servo Disposable Automatic Baby Diaper Machine Manufacture

2.8. Competition from other firms

There is only one polyethylene fast food packaging (Takeaway) manufacturing
company in the country even it didn’t and can’t meet the demand of the city.
Having in mind that there are larger cities in the whole side of the country like
Adama, Awassa, Ambo, Bahirdare, Dessie, Dredawa etc with growing number of
hotels café, Pastry, supermarket, restaurant etc unless and otherwise other took
the business and comes we can say it is an investment with no competition. As
per the information even this single company is planning to go abroad by selling
or taking the plant due to personal health problem.

2.9. Startup summary

Back in old days, eating outside is seen as cultural taboo in the country. Thus,
only few businesses have foods available for sale as market is very rare for the
food they sale. But as time evolves and societies become robust and dynamic,
 39

peoples need to eat outside has been increasing from time to time due to variety
of reasons. Many youngsters also don't cook indoor. Thus, demand for take away
food has drastically increased. In fact, the one of the business ventures in the
country with an almost certain success rate these days is opening cafes and
restaurants. This in turn has made the need for fast food packaging materials
imperative. In addition to this the country has shown an encouraging private
investment in almost all areas of economic and social activities. The private
sector has been motivated by free market oriented economic policy of the
government. To encourage the private sector, the government amended the
investment proclamation several times, which resulted in booming investment in
all sectors of the economy.
2.10. Location and the Potential Market
Location is one of the determinant factors in any business. The area chosen for a
given business largely depends on the type of the sub sector. The decision of the
site selection mostly depends on proximity to the target market.

The location of the project should be given due attention; because the site selection
has its own influence on the target market designed, the quality of the product and
cost of production. The establishment of the project under consideration is
planned to be at the town of Holeta which is 27 km west of Addis Ababa, with a
total plot of 10,000 M. sq owned by woy. Tsehay Tuji.
The location has very good road and electricity access and its proximity to the
capital city, which is less than 30 mins of drive, makes it an ideal location for
such business is a good site to easily transport the products from different directions.
The following are some of the reasons for selecting the area:

1. Proximity to the major potential market for the output, i.e. Addis Ababa
with an estimated more than 5 million residents,
2. Availability of relatively well developed infrastructural facilities such as :
Transportation network that connects the site to different parts of the
country,
 39

Availability of skilled and semi-skilled labor force (manpower)

Other economic and social infrastructures such as :Educational facilities,

Health care centers, Banking and insurance organizations, and
Telecommunication network,

3. Market assessment
Ethiopia is one of the largest countries is sub-Sahara Africa. The country covers
1.112 million square km and occupies a large part of the horn of Africa. The
country endowed with unique culture heritages, impressive scenery and
sustainable climate with a total population of 90 million. Its capital Addis Ababa
is the venue of Africa being the seat of much international organization including
the united Nation Economic commissions for Africa (UNECA), Africa union, over
95 permanent residents of diplomatic missions, regional and international
organization, direct and indirect representative office.

In addition to the local customers, It is common, here diplomatic missions,

regional and international organizations used to organize regular and
extraordinary meetings. The participants need standard accommodation service,
standard restaurants, café etc.

Beyond the local customer because of the country in tourist attraction

endowments coupled with the government’s initiative to aggressively promote the
tourist attraction caters demand the country numbers of restaurant supper
market, pastry hotels café etc. The recent economic development attained, and
the existence of piece on the country makes sure that the number of people that
can use in the above service giving sector as well as tourist is expected to be
large in the future.

3.1 Marketing Plan

The company will try to meet their customers demand by setting a fair price, by
delivering quality products and being excellent supplier of the item.
3.2 Market Size
 39

As Ethiopia is in a fast development and as per the information collected there

are many Hotels café & Restaurant, supermarket, pastry and bakery in the
capital Addis Ababa and in the country as a whole.

3.3 Industry participants

The only participant industry is Golden Family packing PLC held by foreign
investors. However as mentioned before this company, didn’t cover the demand
and ever more the company will be sold and shut down because of the health
problem of the company owner. Therefore it can be said it is an investment wide
to get a successful result.

3.4 Market growth

The market is increasing day after day since a lot of investors are opening more
Hotels, restaurant super market etc

3.5 Positioning
The business will position itself as it is the only factory marketing high quality
food packing in the Ethiopia.

3.6 Marketing Strategy & positioning

The business marketing strategy incorporates a focus strategy that is, target a
specific target market. The project concentrates its marketing efforts on
attracting all those are engaged in business like Hotels, supermarket,
restaurants, café etc, that are motivated to live in growing, thriving
communities.

3.7 Market survey

Periodic market survey and assessment (both formal and informal) has to be
made to have the feeling of demand that may exist in different areas (niches)
and new markets at different times.
 39

4. Marketing Strategy and implementation

The owner will manufacture high quality standard products with different size
and shape as per the request of the customer. Others often miss the market by
investing in low quality properties which will not provide sufficient ROE (Return
on Investment). In addition the size manufacturing company fail short in
representing the demand of customer. What will set the business apart from in
no fairer to respond the demand of customers? The following sections address
the various tactics that will contribute to this effort.

4.1 Strategy pyramid

The promoter of this business will only engage to satisfy to the need of the
customer without fail. They like to be a superlative manufacturer in the country.
They are ready to fill the serous short fall of the demand.

4.2 Unique selling proposition

The promoters select a special expert on the field of this disposal diaper factory
industry. The selection was made with a serious study the selected person has a
good selling experience with a lot of customers like hyper market, supermarket,
pharmacy stores, retail shops, online channels etc,

4.3 Competitive Edge

The owner utilized a through due diligence process prior to selecting this
manufacturing sector. By doing their homework can competitively set price.
Knowing the market gives the owner the competitive edge over other competition.

4.4 Market strategy and positioning

The business marketing strategy incorporates a focus strategy that is, target a
specific target market. The project concentrates its marketing efforts on attracting
all those are engaged in business like Hotels, supermarket, restaurants, café etc,
that are motivated to live in growing, thriving communities.
 39

4.4.1 Pricing strategy

The project will utilize competition based pricing in which price are based in the
market. The market is through due diligence. The price should be revised
according to the market completion cost of raw material and foreign currency rate
fluctuation.

4.4.2 Promotion and Advertisement

The owners/promoters, as usual should broadly advertise their products through

mass media. The avenue of advertisement can be Radio, different banal on
brushers, radio, flyer, Television, private and public newspapers published in the
country as well as word of mouth advertising.
4.4.3 Marketing program
The owner of this company will assign a very experienced marketing manager
specially engaged promotion and selling some products and this person has
relationship with vast number of hyper market, supermarket, pharmacy stores,
retail shops, online channels etc,

4.5 Sales Forecast

The following table represents the estimated sales from the food packaging
production. The forecast show the sales started from 7.5 million amounts for the
first year on average and grow it at the rate 0.25 % of sale for the three years and
0.3% for the next remaining years.
In million’
Description Year 1 Year 2 Year 3 Year 4 Year 5 Year 6
2,250,000.0 2,812,500. 3,515,625.0 4,570,312. 5,941,406. 7,723,828.
Lunch Boxes
0 00 0 50 25 13
1,500,000.0 1,875,000. 2,343,750.0 3,046,875. 3,960,937. 5,149,218.
Circular Shaped Trays
0 00 0 00 50 75
1,125,000.0 1,406,250. 1,757,812.5 2,285,156. 2,970,703. 3,861,914.
Rectangular Shaped Trays
0 00 0 25 13 06
1,875,000.0 2,343,750. 2,929,687.5 3,808,593. 4,951,171. 6,436,523.
Partitioned Boxes
0 00 0 75 88 44
750,000.0 937,500. 1,171,875.0 1,523,437. 1,980,468. 2,574,609.
Dip Rectangular Containers
0 00 0 50 75 38
Total 7,500,000.00 9,375,000.00 11,718,750.00 15,234,375.00 19,804,687.50 25,746,093.75
 39

1. Bububear baby diapers use a polymer absorbent layer to instantly absorb

urine and keep the baby’s skin dry;
2. Strong absorption, firmly locks the urine, avoiding the risk of leakage;
3. Replacement reminder. When the diaper is wet, it will turn blue to remind
parents to change;
 39

4. Highly breathable outer layer. Unique breathable design, not tight and
stuffy, keep baby comfortable;
5. 3D cutting. According to ergonomic design, protect the healthy growth of
baby's legs;
6. Pure cotton, with elastic waist design, for the baby's personal and
comfortable protection;

The study adopted a cost plus profit approach in determining the selling price
which in set to be just below the existing local market price. The project will utilize
competition based pricing in which price are based in the market. The market is
through due diligence. The price should be revised according to the market
completion cost of raw material and foreign currency rate fluctuation.

The processing and distribution sector in the county and the image builds so far
would be of paramount importance for the success of organization marketing
and commercial activities. The company produces five types of output and sales
revenue is given in details below based on the assumption stated.

Lunch Boxes
Raw Material Output
Processed

Circular Shaped Trays

Rectangular Shaped Trays

 39

Partitioned Boxes

Dip Rectangular Boxes

The following table represents the estimated sales from the food packaging
production. The forecast show the sales started from 7.5 million amounts for the
first year on average and grow it at the rate 0.25 % of sale for the three years and
0.3% for the next remaining years.
In million’
Description Year 1 Year 2 Year 3 Year 4 Year 5 Year 6

Lunch Boxes 2,250,000.00 2,812,500.00 3,515,625.00 4,570,312.50 5,941,406.25 7,723,828.13

Circular Shaped Trays 1,500,000.00 1,875,000.00 2,343,750.00 3,046,875.00 3,960,937.50 5,149,218.75
Rectangular Shaped Trays 1,125,000.00 1,406,250.00 1,757,812.50 2,285,156.25 2,970,703.13 3,861,914.06
Partitioned Boxes 1,875,000.00 2,343,750.00 2,929,687.50 3,808,593.75 4,951,171.88 6,436,523.44
Dip Rectangular Containers 750,000.00 937,500.00 1,171,875.00 1,523,437.50 1,980,468.75 2,574,609.38
Total 7,500,000.00 9,375,000.00 11,718,750.00 15,234,375.00 19,804,687.50 25,746,093.75

The company produces five types of output each estimated product have
describe in terms of type, price, quantity and revenue listed are shown below in
details. Price of each product grows it at the rate 5% of the product price for
three years and 0.1% for the next remaining years.

4.5.1 Plant capacity

Parameters like potential product market size, capacity of the plant machinery
to be installed, operational hours and other factor one taken in to account in
drawing the potential plant capacity. Therefore, the following assumption has
been used to reach at plant capacity of the project.
- Machine Capacity = 60-360 Kg/hrs
- Minimum Capacity used for draw utilization = 60Kg/hrs
- 1 Kg produce 40ps (items)
- Total produce in hours, 60Kg/hrs * 40ps = 2,400ps/hrs
- Daily Produce , 2,400ps/hrs * 8 hrs = 19,200ps/Day
- Annual working days=300 Days
- Daily working hours =8hrs
 39

- Annual production, 19,200ps/Day * 300 Days = 5,760,000/Annum

- First year capacity, Total Estimated First year output/Annual production
= 4,345,089.25/5,760,000 = 75%
- Second year capacity, Total Estimated Second year output/Annual
production = 4,991,747.66/5,760,000 = 87%
- Installed capacity of the plant for the first year is 75% , for the second
year 87% and 100% their after increase the capacity based on the
demand of our product.

4.6 Sales program

The owner of the project will further look as to how they can manage their sales
program. It is weather to pay incentive to sales agents. Commissions that can be
calculated annually based on sales volume to the General Manager as well as the
marketing manager.
4.7 Legal
Clean title and zoning, are instrumental in doing project like this. The title and tax
records are confirmed as per the legal requirement of the country.

5. Organizations and Management

5.1 General Description of the organization and Management
 39

The success or failure of an organization to a large extent depends on its

organization and management thus, business structure of the project has been
formed in such a way to respond to the service needs, and enable the business to
work with high efficiency. In this respect due attention will be given to the staffing
of the business with competent personal so as to make sure that the project will
not face managerial and organization problem.
In preparing the organization structure of the business and determination of
manpower requirements, an attempt has been made to limit the required
manpower in consideration of the following.
The various distinct jobs are performed according to the designed organizational
chart. The skill required for running the various activities or operations of the
business.
The major source for skilled manpower requirement of the project will basically
be the existing local labor market. The local business and education institutes
are source for skilled and semi-skilled personnel required by the plant. Unskilled
labor is readily available in the project area.
5.2 Organizational Structure
The proposed organizational structure and staffing plan will enable the plant:
To control and keen arbitrary personnel actions, that are recruitment,
promotion, training etc …
To guide and provide control mechanisms regarding the scope of
permanent employee development under normal operation.
To indicate the line of communication among the work units of the plant
and different positions.
To portray the line and staff relationship among the work units.
The management team is constituted by the board and will have the GM
Marketing & production manager and finance & accounts. The management team
will perform all activities forwarded by the board.
5.3 Manpower Requirement
 39

According to the management and organization structure the project will create
new job opportunities for at least 42 employees when it starts operations. All
employees will be recruited from the local market. Some are professional; some
are clerical and other are non-clerical (un-skilled employees). The list of employs
required for the project is listed herein below in accordance with their positions
and their corresponding monthly salary.
5.3.1 Skilled Manpower Requirement
No Position No. required Qualification Monthly salary Annual salary
.
1. G/ Manager 1 BA Bus. Adm. 15,000.00 180,000.00

2. Production Manager 1 BA Mag. 8,000.00 96,000.00

3. Marketing Manager 1 BA Mar. 8,000.00 96,000.00

4. Finance Manager 1 BA Acct. 8,000.00 96,000.00

5. Quality controller 2 Dip. Chemist 4,500.00 108,000.00

6. Accountant & cashier 2 Dip Acct. 3,000.00 72,800.00

7. Sales person 3 Dip Mar. 2,500.00 90,000.00

8. Secretary 1 Dip. Sec. 2,000.00 24,000.00

9. Machine Operator 2 Dip. Eng. 3,500.00 84,000.00

10. Assistant operator 3 Dip. Eng. 2,500.00 90,000.00

Total 0 0.00

5.3.2 Non Skilled Manpower Requirement

No. Position No. required Monthly salary Annual salary
1. Store keeper 1 2,200.00 26,400.00

2. Causal laborers 12 800.00 115,200.00

3. Driver 4 1,800.00 86,400.00

4. Guards 4 1,200.00 57,600.00

 39

5. Cleaners 2 800.00 19,200.00

Total 0 0.00
5.4 Management Profile
The promoter of the project, W/ro Tsehay Tuji, she is an Ethio – Canada business
women who is graduate of accounting with working experience of 4 years as an
employee of Ethiopian Water Works Construction Authority, this has benefited
her to have effective management and control over her business activities. She
has been actively engaged in various business activates in Ethiopia and Canada
since 1987. Some of the major business she has been engaged include import
and export of various merchandize, running a stationary shop, export business in
Ethiopian traditional food and cloths as well as import & trade in house wares
and kitchenware items. W/ro Tsehay is currently engaged in retail trade of
Ethiopian traditional foods in Canada. With average annual turnover of CAD
300,000.00, her business is one of the major players in Ethiopian traditional food
sector in Canada. As per the organizational chart of the company, there are
different departments under the GM.

Name Position Education Field of study

Qualification
Woy Tsehay Tuji Owners/ General Manager Diploma Accounting
Ato Mehari Habte A/General Manager BA Accounting
th
Ato Melaku Kefle Marketing Manager 12 Marketing
Woy Kibrethana Girma Finance Manager BA Management

The management team of the company are experienced and qualified in their
respective fields.

6. Financial analysis and evaluation

The financial analysis includes the analysis of the total outlay capital required for
the project which would consist of total fixed investment cost and working capital
and pre- production costs, the source of finance for the total planned expansion
investment- cost requirement and other parameters of feasibility analysis.
 39

6.1 Source of capital expenditure

The forecasted investment capital will be obtained from two sources are equity
contribution and bank loan.
The project is expected to need Birr 25,858,110.00 million total investment,
Accordingly it is proposed that 61% of investment will be contributed from own
equity except working capital requirement and the remaining 39% will be secured
from a Enat bank in the form of medium term investment loan at 16.75% interest
rate for 5 years in quarterly base. The remaining cost of investment has fully
covered by equity contribution. The detailed plan for equity contribution and
bank loan is depicted in the following table.

Description Total cost Equity Bank finance

contribution
Building and construction 11,881,706.00 11,881,706.00 0.00
Machinery and equipment* 6,214,304.00 1,864,291.00 4,350,013.00
Land improvement 120,000.00 36,000.00 84,000.00
Vehicle 4,800,000.00 1,440,000.00 3,360,000.00
Pre-operating costs* 300,000.00 90,000.00 210,000.00
Office furniture and equipment 0.00 76,260.00 177,940.00
Raw material 693,045.00 207,914.00 485,131.00
Working capital 1,594,855.00 0.00 1,594,855.00
Total Fixed Investment cost 0.00 0.00 0.00
Percentage cont.   61% 39%

N.B *Pre operating costs include project implication cost such as installation,
startup, commissioning, project engineering and management etc. and Bank loan
will be approve up to Birr 10 Million.

6.2 Equipment and Furniture

 39

As part of the synergy effect the company enjoys in expanding in the same
business area, the additional office furniture procurement as the project enter to
production level are set in the following table.
No Description Unit Quantity Unit cost Total cost (in Br.)
Office and plant furniture No
1 Tables “ 8 2,500.00 20,000.00
2 Chairs “ 18 1,200.00 21,600.00
3 Guest sofa “ 4 5,000.00 20,000.00
4 Shelves “ 5 4,500.00 22,500.00
5 Filing cabinet “ 8 3,000.00 24,000.00
6 Safe deposit box “ 2 4,500.00 9,000.00
7 Brief case “ 3 800.00 2,400.00
8 Fax machine “ 2 7,500.00 15,000.00
9 Computer with printer “ 15 7,500.00 112,500.00
10 Electrical Calculator “ 3 2,400.00 7,200.00
Total 0.00
6.3 Machinery and equipment
The machinery and equipment required for the operation of the project are
import from foreign market. The following tables depict the associated costs.

No. Description Quantity Total cost Total Annual cost

(@23.1015 Rate)

1 Machinery & equipment 1 USD 269,000.00 Birr 6,214,303.50

Total Cost Birr 6,214,303.50
6.4 Raw Material Input cost
The raw material inputs required for the operation of the factory are import from
foreign market. The following tables depict the associated costs.

No. Description Quantity Unit cost Total Cost Total Annual cost
(@23.1015 Rate)

1 Raw Material 20 USD 1,500.00 USD 30,000.00 Birr 693,045.00

Total Cost Birr 693,045.00

6.5 Vehicle
 39

Vehicle used for transport service for our employees and distribution of the
products to our customers.
No Description Quantit Unit cost Total cost (in Br.)

y
1 Tata star bus for employees service 1 1,700,000.00 1,700,000.00
2 Vehicle used for General Manager 1 850,000.00 850,000.00
3 Vehicle used for product distribution 3 750,000.00 2,250,000.00
Total cost 0.00

6.6 Production Expenses

It is deemed essential to make realistic forecasts of factory production cost,
operating cost, administrating overhead costs, and other expenditures and
consequently total production costs in order to establish working capital
requirement and compute project benefits. These costs calculated as total costs
and all other cost elements required for the computation have been estimated
and scheduled in line with the envisaged capacity build up program of the
project. Hence the annual production costs required are summarized below.

I. Utilities Expenses
The main utilities needed for the operation of the plant are electricity and water;
electricity will be required to the machinery and office equipment, as well as for
lighting of production hall, store buildings, offices and other buildings.

In estimating costs of utility expenses for operations and maintenance of the

project cost of electricity, water, fuel, oil and lubricant consumption of the plant
have been calculated based on the rates of which have been estimated on the
bases of proposed plant capacity utilization and this figure of utility expense is
expected to increase at a rate of 5% every year in accordance with the change
capacity utilization and the forecasted market price change of corresponding
commodities. The following tables depict the associated utility costs:
Cost at various capacity utilization rate
S/N Description (in birr)
1 year 2 years 3-6 years
 39

1 Electricity (4000 KW * Birr 1.91)/Month 91,680.00 96,264.00 101,077.20

2 Water (20 M3 * Birr 1.75)/Month 420.00 441.00 463.05
3 Telephone ( Estimate 1,500.00/month) 12,000.00 12,600.00 13,230.00
4 Postal service ( Estimate 300.00/month) 3,600.00 3,780.00 3,969.00
5 Other ( Estimate 525.00/month) 6,300.00 6,615.00 6,945.75
Total cost 0.00 0.00 0.00
Note-The remaining three years are also calculated as above.

II. Repair and Maintenance Expenses

The following rate has been assumed to constitute the annual repair and
maintenance expense of the project.
 Building and civil works repair and maintenance at 1% cost. However, its
assumed that there will be no need for repair and maintenance of the
factory and office building in the first two years,
 Machinery & equipment spare part, repair and maintenance expense at 1%
of the costs of machinery & equipment,
 Vehicle spare part, repair and maintenance expense at 1% of the costs of
vehicle,
 Office furniture and equipment annual repair and maintenance at 2% cost.
Description Costs Rate 1st & 2nd year 3rd -5th year
Building & construction 11,881,706.00 1% 118,817.00
Machinery & equipment 6,214,303.50 1% 62,143.00 62,143.00
Vehicle 4,800,000.00 1% 48,000.00 48,000.00
Office furniture & equipment 254,200.00 2% 5,084.00 5,084.00
Total 0.00 0.00

III. Salaries and Wages Expense

The annual expenses of wages and salaries for the plant under scrutiny have
been calculated in accordance with the man power list proposed under the
organization and management section of this study. Moreover, annual increment
of 10% is assumed to arrive at the figures in consideration of salary increment
bonus pay end other employment benefits starting year annual salaries and wage
expense is estimated to be Birr 1,241,600.00
IV. Factory Overhead Expense
 39

Included in the expenses under this title are annual legal & license expense,
employees uniform purchase expenses and annual insurance cost of plant
properties expense as shown below.
i. Legal & license annual expenses
ii. Employees uniform purchases
iii. Annual insurance cost of plant properties is determined as follows
 Building /civil works
 Plant machinery and equipment
 Vehicles

Accordingly the annual factory overhead costs are estimated to be Birr 195,
000.00 for the first year and are expected to increase by 5% for two years than
after increase by 10% because of additional equipment will be consider at the 3 rd
year which increase insurance expense furthermore. Annual factory overhead
costs of the envisaged project are depicted in the table below together with the
assumption used:
No. Description Annual cost Assumption Used
1 Property insurance 120, 000.00 Estimate/year
2 Legal & license fee 3,000.00 3,000/year
3 Working uniforms 12,000.00 Estimate/year
4 Fuel & lubricant 60,000.00 5000/Birr/month
Total overhead cost 0.00

V. Office Supplies Expenses

Annual plant administrative overhead expenses include cost incurred for items
such a
 Stationary & office Supplies
 Printing and coping
 Telephone postages fax and internet e-mail service.
According the annual administrative over head costs are estimated to be Br
42,000 for the first year costs of envisaged project and expected to increase by
10% every year and it is shown show in the following table.

No Description Annual Cost Assumption Used

 39

1 Stationery printing & office supplies 30,000.00 2,500 Birr /month

2 Miscellaneous 12,000.00 1,000 Birr/month
Total administrative over head cost 42,000.00

VI. Depreciation Expenses

Annual depreciation expenses for the fixed assets and capital expenditures of the
envisaged project have been calculated based on a straight line method using the
following rates on the original investment values.
 Building and civil works…………………….5%
 Plant machinery & equipment………….…10%
 Vehicles…………………………………………10%
 Office furniture & equipment……………...20%
Description Investment Rate Total Total
Depreciation Depreciation
st
1 year 2nd year
Building civil work 11,881,706.00 5% 594,085.00 594,085.00
Machinery & equipment 6,214,303.50 10% 621,430.00 621,430.00
Vehicles 4,800,000.00 10% 480,000.00 480,000.00
Office furniture & equipment 254,200.00 20% 50,840.00 50,840.00
Total 0.00 0.00

Note-The remaining four years are also calculated as above.

VII) Marketing and Selling Expenses

The marketing costs for the products under reference are determined for cost
items such as
 Product distribution expense
 Promotion (commission) expenses
 Advertisement and marketing over head costs
Accordingly it is estimated that the factory will include marketing and selling
expenses of Birr 15,000 during the first year of operation and these expenses are
assumed to increase by 10% every year.

No. Description Annual cost Estimated used

1 Distribution selling & divests 15,000.00 2,500.00 Birr/Month
Total 15,000.00
 39

6.7 Assumptions for financial projection and evolutions

The financial analysis and evaluation of the project under faience has been
conducted taking into account of the following general assumptions to gather
with the specific desorption discussed in the earlier page of this study.

The financial analysis and evaluation have been made for a period of 6 years only
during which time most of the office furniture and equipment are assumed to be
fully depreciated, loans are settled payback period accomplished and excess
revenue over and above the investment value will be generated.

1. Annual salary and benefit is Birr 1,241,600.00 for the first year and assumed
increase by 10% annually
2. If is assumed that the plant will operate in one shift (8 working hours) for 288
working days per annum
3. Utility expense such as electricity, water, telephone, postal service and other
will charge to company estimated Birr 114,000.00 per annum and expected to
increase at a rate of 5%
4. Office supplies expense will be Birr 42,000.00 per year and expected to
increase at a rate of 10%
5. It is assumed that inventory increase by the first two years by 50% then after
increase at a rate of 75%
6. Accordingly the annual factory overhead costs are estimated to be Birr 195,
000.00 for the first year and are expected to increase by 5% for two years than
after increase by 10% because of additional equipment will be consider at the
3rd year which increase insurance expense furthermore.
7. It is assumed that sales increase by the first three years by 25% then after
increase at a rate of 30%
8. Manufacturing cost for this project is estimated to be 5% of sales throughout
the five years.
9. It is assumed that credit sales for first year 20% of total sales then after
increase at a rate of 35%
 39

10. Interest expense calculated at 16.75% interest rate per annual in quarterly
base for 5 years.
11. It is assumed that from initial project year up to two years no withdrawal
are consider however year three, four, five and six allowed Birr 3M, 6M, 8M
and 12M respectively, deduct from retained earnings before considering
beginning year capital.
12. Tax deduct based on Ethiopian tax proclamation business tax > 60,000.00
pay 35% tax rate of EBT – 7,950.00
13. It is assumed that 37% of the total investment on machinery and raw
material is obtained from bank loans while the balance amounting 63% of the
procurement cost will be constituted by the project promoter or the remaining
initial cost contributed from equity investment.
14. Deprecation of fixed assets are assumed straight line method
 39

PROJECTED STATEMENT OF PROFIT AND LOSS

Description Year 1 Year 2 Year 3 Year 4 Year 5 Year 6
Revenue 7,500,000.0 9,375,000.0 11,718,750.0 15,234,375.0 19,804,687.5 25,746,093.75
0 0 0 0 0

Manufacturing cost 468,750.0 585,937.50 761,718.7 990,234.38 1,287,304.69

375,000.00 0 5

Gross Margin 7,125,000.00 8,906,250.00 11,132,812.50 14,472,656.2 18,814,453.13 24,458,789.0

5 6

LESS: Administrative &  

Operating Expenses  
Salaries and Wages 1,241,600.00 1,365,760.0 1,502,336.00 1,652,569.60 1,817,826.56 1,999,609.22
0
Utility 114,000.00 119,700.0 125,685.00 131,969.2 138,567.71 145,496.1
0 5 0
Factory Overhead 195,000.00 204,750.0 225,225.00 247,747.5 272,522.25 299,774.4
0 0 8
Repair & maintenance 115,227.00 115,227.0 234,044.00 234,044.0 234,044.00 234,044.0
0 0 0
Office supplies 42,000.00 46,200.00 50,820.00 55,902.00 61,492.2 67,641.42
0
Marketing & selling 15,000.00 16,500.00 18,150.00 19,965.00 21,961.5 24,157.65
0
Depreciation expense 1,746,355.00 1,746,355.0 1,746,355.00 1,746,355.00 1,746,355.00 1,695,515.00
0
Total Expenses 3,469,182.00 3,614,492.00 3,902,615.00 4,088,552.35 4,292,769.22 4,466,237.86
EBIT 3,655,818.00 5,291,758.00 7,230,197.50 10,384,103.90 14,521,683.90 19,992,551.20

Interest expense 1,589,920.17 1,339,842.95 1,045,172.48 697,957.00 288,826.79 0.00

EBT 2,065,897.83 3,951,915.05 6,185,025.02 9,686,146.90 14,232,857.11 19,992,551.2
 39

PROFIT TAX 35% 715,114.2 1,375,220.2 2,156,808.76 3,382,201.42 4,973,549.99 6,989,442.92

4 7

Net Income/Loss 1,350,783.59 2,576,694.78 4,028,216.26 6,303,945.49 9,259,307.12 13,003,108.2

8

39
 PROJECTED BALANCESHEET

Description INITIAL Year 1 Year 2 Year 3 Year 4 Year 5 Year 6

ASSET    
Cash 1,594,855.00 1,206,223.32 4,390,628.74 5,981,370.23 6,677,389.57 6,678,999.98 7,589,656.70
Account Receivable - 2,100,000.00 3,062,500.00 3,828,125.00 4,976,562.50 6,469,531.25 8,410,390.63
Building 11,881,706.0 11,287,620.70 10,693,535.40 10,099,450.10 9,505,364.80 8,911,279.50 8,317,194.20
0
Machinery & Vehicle 11,014,304.0 9,912,873.60 8,811,443.20 7,710,012.80 6,608,582.40 5,507,152.00 4,405,721.60
0
Office Furniture& Equipment 254,200.00 203,360.00 152,520.00 101,680.00 50,840.0    
0
Land Improvement 120,000.00 120,000.00 114,000.00 108,300.00 102,885.00 97,740.7 92,853.7
5 1
Inventory 693,045.00 1,039,567.50 1,559,351.25 2,728,864.69 4,775,513.20 8,357,148.11 14,625,009.1
8
Pre production cost 300,000.00 240,000.00 192,000.00 153,600.00 122,880.00 98,304.0 78,643.2
0 0
TOTAL ASSET 25,858,110.00 26,259,645.12 29,194,728.59 30,984,840.32 33,175,486.22 36,582,264.96 44,120,211.41
LIABILITY    
Profit tax payable   715,114.24 1,375,220.27 2,156,808.76 3,382,201.42 4,973,549.99 6,989,442.92
Loan payable 10,000,000.0 8,597,576.29 6,945,075.36 4,997,903.97 2,703,517.09 - -
0
TOTAL LIABILITY 10,000,000.00 9,312,690.53 8,320,295.63 7,154,712.73 6,085,718.5 4,973,549.9 6,989,442.92
1 9
CAPITAL    
Owners equity 15,858,110.0 15,596,171.0 16,946,954.5 20,874,432.9 23,830,127.6 27,089,767.7 31,608,714.9
0 0 9 6 0 2 6
Retained earning   1,350,783.59 3,927,478.37 2,955,694.64 3,259,640.12 4,518,947.24 5,522,055.53
TOTAL CAPITAL 15,858,110.00 16,946,954.59 20,874,432.96 23,830,127.60 27,089,767.72 31,608,714.96 37,130,770.48
TOTAL LIABILITY & CAPITAL 25,858,110.00 26,259,645.12 29,194,728.59 30,984,840.32 33,175,486.22 36,582,264.96 44,120,213.41

39
PROJECTED STATEMENT OF CASH FLOW

Description INITIAL Year 1 Year 2 Year 3 Year 4 Year 5 Year 6

Expenditure              

25,858,110.0 - - - - - -
Fixed Capital
0
- 375,00 468,75 585,93 761,71 990,23 1,287,30
Operating Cost
0.00 0.00 7.50 8.75 4.38 4.69
25,868,110.0 375,00 468,75 585,93 761,71 990,23 1,287,30
Total
0 0.00 0.00 7.50 8.75 4.38 4.69
Revenue              
- 7,500,00 9,375,00 11,718,75 15,234,37 19,804,68 25,746,09
Sales Revenue
0.00 0.00 0.00 5.00 7.50 3.75
  7,500,00 9,375,00 11,718,75 15,234,37 19,804,68 25,746,09
Total
0.00 0.00 0.00 5.00 7.50 3.75
Cash Flow              
(25,858,110.0 7,125,00 8,906,25 11,132,81 14,472,65 18,814,45 24,458,78
Annual Cash Flow (=)
0) 0.00 0.00 2.50 6.25 3.13 9.06
- 1,746,35 1,746,35 1,746,35 1,746,35 1,746,35 1,695,51
Depreciation (-)
5.00 5.00 5.00 5.00 5.00 5.00
- 1,589,92 1,339,84 1,045,17 697,95 288,82
Loan Interest (-) 0.17 2.95 2.48 7.00 6.79
-
(25,858,110.0 3,788,72 5,820,05 8,341,28 12,028,34 16,779,27 22,763,27
Taxable Income (=)
0) 4.83 2.05 5.02 4.25 1.34 4.06
- 1,318,10 2,029,06 2,911,49 4,201,97 5,864,79 7,959,19
Income Tax (-)
3.69 8.22 9.76 0.49 4.97 5.92
  2,470,62 3,790,98 5,429,78 7,826,37 10,914,47 14,804,07
Income After Tax
1.14 3.83 5.26 3.76 6.37 8.14
  1,746,35 1,746,35 1,746,35 1,746,35 1,746,35 1,695,51
Depreciation (+)
5.00 5.00 5.00 5.00 5.00 5.00
Annual CF After (25,858,110.0 4,216,97 5,537,33 7,176,14 9,572,72 12,660,83 16,499,59
Tax(=) 0) 6.14 8.83 0.26 8.76 1.37 3.14
(25,858,110.0 3,611,97 4,062,44 4,509,41 5,152,38 5,836,83 6,515,26
PV
0) 1.00 3.37 5.48 3.69 9.86 2.22
CACF (25,858,110.0 (21,641,13 (16,103,79 (8,927,65 645,07 13,305,90 29,805,49

39
 0) 3.86) 5.03) 4.77) 4.00 5.37 8.51

PROJECTED STATEMENT OF OWNERS EQUITY

Description Year 1 Year 2 Year 3 Year 4 Year 5 Year 6
15,596,171.00 16,946,954.5 20,874,432.96 23,830,127.6 27,089,767.7 31,608,714.96
Beginning capital 9 0 2
ADD BACK:  
1,350,783.5 2,576,694.78 4,028,216.2 6,303,945.49 9,259,307.12 13,003,108.28
Current year NI/Loss 9 6
Ending retained - 1,350,783.59 3,927,478.3 2,955,694.64 3,259,640.12 4,518,947.24
earning 7
LESS:  
-   5,000,000.0
6,000,000.00 8,000,000.00 12,000,000.00
Withdrawal 0
Ending capital 16,946,954.59 20,874,432.96 23,830,127.60 27,089,767.72 31,608,714.96 37,130,770.48
 39

Evaluate the Project

 Payback period (PBP)

PBP = yrs before full recovery + un recovered cost

Cash flow during next plan

Where cash flows are uneven, payback is calculated by working out the
cumulative cash flows over the life of the project.

Year Cash in flow Cumulative cash in flow

0 -25,858,110.00 -25,858,110.00

1 4,216,976.14 -21,641,133.86

2 5,537,338.83 -16,103,795.03

3 7,176,140.26 -8,927,654.77

4 9,572,728.76 645,074.00

5 12,660,831.37 13,305,905.37

6 16,499,593.14 29,805,498.51

PBP = 3 + 8,927,654.77 = 3.93

9,572,728.76

= 0.93 = 3 years, 0.93 * 12 Months =11 Months

= 3 years with 11 month, which means the project needs three years and eleven
months to return its initial investment.
 39

 Net Present Value (NPV)

The project NPV represents the surplus funds (after funding the investment)
earned on the project, therefore:
 If the NPV is positive –the project is financially viable
 If the NPV is zero – the project breaks even
 If the NPV is negative –the project is not financially viable

Year Cash in flow Cumulative cash in flow

0 -25,858,110.00 -25,858,110.00

1 4,216,976.14 3,611,971.00

2 5,537,338.83 4,062,443.37

3 7,176,140.26 4,509,415.48

4 9,572,728.76 5,152,383.69

5 12,660,831.37 5,836,839.86

6 16,499,593.14 6,515,262.22

Total PV cash in flows 29,688,315.62

Less: PV of cash out flow 25,858,110.00
NPV +3,830,205.62
[

The project cost of capital is its interest rate i.e. 16.75% which is an interest
rate for project loan and by using this cost of capital. The NPV of the project is
+3,830,205.62 and the project is viable.

 Internal rate of return (IRR)

 39

= Approximately 21.05%
The IRR represents the discount rate at which the NPV of an investment is zero.

As such it represents a breakeven cost of capital. Projects should be accepted if

their IRR is greater than the cost of capital. In our case, the cost of capital of the

project is 16.75% which is an interest rate for project loan. Based on the

aforementioned information the IRR of the project is 21.05% which are greater

than the cost of capital of the project and the project is accepted in this respect.

 Benefit Cost Ratio (BCR)

BCR = PV & Cash in flows

PV & Cash out flows

= 29,688,315.62 = 1.15
25,858,110.00
 Therefore, the profit of the project is one times higher than that of the
initial cost.

7. Project implementation
 39

7.1 Project Implementation and Schedules

The project implementation period for the predict plant covers the period
between pre-investment phase and plant commissioning and testing phase. The
various tasks to be carried out during the period of the project implementation
are divided into three phases; and based on the different activities involved
under each phase; a reasonable implementation schedule of the plant is
planned.
Phase1. Project Pre-Investment Phase
During this period activities to be carried out are:
 Preparation of feasibility study, and legal documentation of the project.
 Selection of raw material supplier and agreeing on the supply condition
 Submission of documents to banks for financial arrangement.
Phase II. Project Construction (Implementation) Phase
The second phase is the period during which the main project construction and
other critical activities will be carried out. Activities to be carried out here are:
 Preparation for the procurement of production machinery and equipments.
 Follow-up on delivery of machinery.
 Power line extension and connection.
 Erection of production machinery and equipment.
 Define a brand name for the product and design suitable packaging material
for the new product
This phase is expected to take the lion's share of the project implementation
phase.
Phase III. Plant Commissioning and Trial (Test Run) Phase
The last phase of implementation program deals with:

 Commissioning the performance, and testing of the plant machinery and

equipment.
 Launch the product into the market and do intensive market
7.2 Project Management and Implementation Cost
 39

Project management and implementation schedule is the time where capital

expenditure or (investment capital) will be committed for the realization of the
project. The tasks involved during project implementation incurred cost to the
project, which are considered to be part of the total investment capital
expenditure. These are including project implication cost such as installation,
startup, commissioning, project engineering and management, office supplies,
vehicle running, legalization process, and consultancy fee etc.
8. Summary and Conclusion
This study is undertaken to establish the requirements, technical, financial and
management, and the viability of the project. Accordingly, the various aspects of
the technical, financial and management requirements of project and necessary
arrangements have been analyzed under the project.
Accordingly, the total financial requirements, including investment and
operational costs, have been established. The initial investment cost is about
25.86 million birr. The technical and managerial aspects of the project
operation have also been analyzed and found to be feasible.

The financial viability of the project has been critically assessed and analyzed
for a period of six years. The income statements, the cash flow forecasts, and
the balance sheets strongly confirm the results to be sound and healthy. The
financial viability indicators, including Net present Value and Financial Internal
Rate of Return, have consistently confirm that project is a viable venture.

Finally, the project will be providing employment opportunities for many skilled
and unskilled employees. As a result from the financial and socio-economical
point of view the project could be considered viable and rewarding and will have
grate socio-economic significance for the promoter, the public and the country.
Therefore, it can be concluded that the project can compute and operate in the
framework of free market mechanism and implementation of the project is
recommended.