PROJECT PROPOSAL

FOR

INJERA MAKING FOR EXPORT

PROJECT TO BE IMPLEMENTED IN SEBETA TOWN,

O/S/Z/S/F ZONE, OROMIA REGIONAL STATE

PROMOTER: -SAMIRA MOHAMMED

OCT, 2020

ADDIS ABABA, ETHIOPIA

 Food Processing Factory Special Injera Making

Table of contents

1. Executive Summary
1.1 Introduction……………………………………………………………………………4
1.2 Stating and identification ………………………………………………….…………8
1.3 Urban Land and Location ….………………………………………………...……...11
1.4 Infrastructures and Premises Required……………………………………………....12
2. Type of Plastic
2.1 Process and equipments required……………………………………………..…...…15
2.2 Objective of the project …………………………………………………...………...16
2.3 Source of Employees……………………………………………………………...…16
2.4 Source of governmental revenue ……………………………………………………16
2.5 Source of social service………………………………………………………..…….17
2.6 The Market Demand Potential………………………………………………....……17
2.7 Competition……………………………………………………………………….….18
3. Organization and Structure
3.1 Organization Chart…………………………………………………………………..19
3.2 Organization and Management………………………………………………………20
3.3 Man power Requirement…………………………………………………………..…21
3.4 The General Managers duties and responsibilities…………………………..………22
4. Financial Requirement
4.1 Total initial Investment cast …………………………………………………..…….23
4.2 Annual product cost ……………………………………………………………...….23
4.3 Financial analysis and statement ………………………………………………..…..27
4.4 Payback period ……………………………………………………………………..28
4.11 Environmental Impact of the project…………………………………………....….28
4.12 Future Development and exit strategically……………………………………...….28

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I. Executive Summary

1. Project Name: Samira Mohammed

1.1. Sector: - Food Processing Factory

 Injera making for domestic 20 % and 80 % for Export

 Kolo and other related products
 Yeast
 Bread Improver
 Shanty Cream,
 Cereal,
 Snacks Nuts
 Starch
 Different Related to Food Processing

1.2. Status: - News

2. Project owners:- Samira Mohammed
2.1 Nationality:- Ethiopian
3. Project Location:- Oromia Regional State
Special Zone Surrounding Finfine
Sebeta Awas woreda
Sebeta Town
04 kebele

4. Land Area and capital

4.1 Land area :- 1,500 M2
4.2 Capital of the project: - 100 Million
 From this 30% (birr 30,000,000.00) will be covered by the promoter of the
project,
 While the rest 70% (birr 70,000,000.00) `will be covered by bank loan.

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5 Planned Employment of the creation of the project

5.1 On Permanent Basic: - 100
5.2 On Temporary Basic: - 200
6 Initial Investment Capital: - 36,000,000
7 Fixed Investment capital:- 84,000,000
8 Source of fund of the project
8.1 Promoters Owner Equity:- 30%
8.2 Expected Bank Loan :- 70 %
8.3 Loan Repayment Period :- 5 Year
8.4 Interest Rate :- 8 %

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1. INTRODUCTION

"Injera" is an Amharic term for Ethiopian bread similar to pan cake, made usually from teff.
Injera is thin, prepared from teff flour, water and starter (a fluid collected from previously
fermented mix) after successive fermentations The best acceptable (sensory) injera should be
rich in eyes, softer, thin, rolable and sour taste due to the fermentation process. Injera is a
traditional common ethnic staple food consumed in all the parts of the Ethiopia and Eretria, some
parts of the Somalia. However, small portion of rice, wheat, enset (Ensete ventricosum (Welw.)
Cheesman) based foods consumed as part of the staple food along with injera in Ethiopia .
Gebrekidan and Gebrehiwot described that distinctive injera is in a circle shape, softer in texture,
spongy and resilient, about 6 mm. in thickness, 60 cm in diameter with uniformly spaced
honeycomb-like ‘eyes’ on the top Flatten breads/pan cakes with or without fermentationis very
famous in diverse areas of the world, they may be differs each in the ingredients and preparation
process, size and sensory properties. The foods similar to the injera were available in all over the
world, as stated in the previous, their ingredients and processing methods may be different
from the injera. Some examples are Dosa (India) Cong You Bing (China), Apam balik (Chains,
Taiwan, Brunei, Indonesia, Malaysia and Singapore) Baghrir (Algeria and Morocco) Bánh cu n
(Northern Vietnam) , Blini (Russia, Ukraine and Belarus) Cachapa (Venezuela), Chatānmari
(Nepal) kissra (Sudan) . Teff is an ancient crop belongs to family poaceae, it is very popular in
highlands of Ethiopia since more than 2,000 years. Ethiopia is considered as the place of teff
So to introduction yeast and how to used in baking bread, like that of agriculture remained
backward and had been characterized by poor performance. This reached its worst position
especially during the past regime because of the ill-advised economic policy of the government
used to follow. But together with the coming to power of the present government after the
overthrow of the dergue regime, the situation started changing in favor of the country’s
economy. Consequently, the overall performance of the economy has been improving and has
resulted in the economic development that has been achieved with in past few years.

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There are various reasons behind this. Above all, the government after it has seized the power
had shown its keen interest and dedication to exert all necessary efforts to wards the
development of the economy. This was clearly indicated in the economic policy issued during
the transitional period. Besides, various investment codes were issued following the issuance of
the new economic policy.

Currently, in order to encourage private investment and to attract capital technology and know-
how to the country comprehensive packages of incentives are granted to investor by the
investment proclamation.
origin [14] and domestication [15]. Teff was reported extensive distribution in high elevation and
rainfall regions of central, eastern and southern Africa. Now, nutritionists considered teff as an
ancient and “super grain”. Teff cultivation has also reported in some other parts of the world like,
USA, South Africa, Australia, India, Kenya, Eritrea, Djibouti, southeastern Sudan and
Netherlands Teff appreciated for balanced nutrition properties, reported to possess protein in the
range of 9.4–13.3% by superior equilibrium in essential amino acids like leucine, valine, proline,
alanine, glutamic and aspartic acids are the major. In case of the carbohydrates, 73% of
starch present in whole kernel stored as multilateral starch granules in the endosperm of the grain
Teff reported 2.6–3.0 % of ash, and 2.0–3.1% of lipid with rich amounts of minerals like Iron,
Calcium, Zinc, Magnesium than other cereals The nutritional composition of the Teff and teff
injera from USDA data base is presented in
In certain aspects, teff injera was considered greater to wheat bread and has possible nutritional
importance. Teff is the most well-liked grain for preparation of injera, even though additional
grains such as sorghum, maize, barley, wheat and finger millets reported to use occasionally.
Usually, injera is consumed along with the stew called as “wot” The term wot meaning is ‘wet’
in Amharic language, the resemblance English meaning is a stew. The stew is made from
vegetables and animal meat and served with injera. “Doro-wot” is a stew prepared from chicken,
onions, red pepper, spices, butter and water. “Shiro” is a most common wot prepared from
lentils, pulses, spices, red pepper etc . However, injera also consumes commonly with cooked
meat, boiled vegetables like beat root, cabbage, potato, spinach, kale, etc. The honey-comb like
eyes help in the grasping of wot which soaks into the pores on the surface of injera In Ethiopia
still the injera preparation and consumption carrying by traditional practices only. However,
scientific research on areas like injera from composite flour; microbiological properties and

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preservation were reported. In this regards, the objective of this paper is to review the traditional
practice and scientific research related to the injera preparation. History, cultural and Ethnic
Aspects of Injera According to the Stewart and Getachew [1], the history of injera preparation is
a mistery, however, they reported that from unpublished sources injera dated back to the 100
B.C. In case of the teff grain, the history was dated back to the 3350 BC, archeologists reported
the presence of teff grain in Egypt pyramids [24]. However, some authors are reported the
evidence of excavated cooking pans of injera and “shiro” (a stew with lentils) (Fig. 2 A) dated
back to the 600 AD [25]. Ethiopians have special beliefs and attitudes towards to the foods in
this regard; injera’s role in Ethiopian culture is significant and prestigious. In Ethiopia, people
always celebrate national and religious holidays including their family gatherings like marriage,
birthday, and death ceremonies. In all the situations injera makes majority of the food in lunch
and dinner times. However, the dried injera is reconstituted in to a spicy, usually vegan diet
constitutes of garlic and tomato sauce consumed in breakfast called as “firfir”. Injera usually
consumes with “wot”, it is a traditional dish made from the mix of vegetables, meat, different
spices and sauces. Usually, “wot” served on the top of the injera. Ethiopian Orthodox Christians
follows the fasting in different months in the nholidays like Easter and Christmas. At these
fasting days nthey strictly follows the vegan diet, at this duration injera consumes with wot
prepared by the lentils called as “shiro” along with different boiled vegetables and pasta (Fig. 2
E) served on a beautiful basket called as “mesob”. In addition, injera is still a major diet for
migrant Ethiopians to different western countries. This is evident from the availability of the
Ethiopian restaurants and injera in western countries where Ethiopian migrant’s populationsm
are more. Traditionally meal (injera) in Ethiopia consumed in the communal plate (known 2-3
people eats in one plate with same injera) it shows their relation, closeness and
friendship. Amhara people in Bahir Dar region (Fig. 1) have a strong belief that, the woman who
prepares the best quality of the injera is considered as good at domestic management. Similarly,
the women who prepared injera with good eyes compared with honey bee and denote that, she is
very hard working in nature. Also, injera has unique role in baptism ceremony of the new
born child in orthodox Christians in Bahir dar city. In this ceremony some families practice
roiling of baby in injera and they believe that, this act provides bright future and good fortune for
the children. In addition, the orthodox churches the priest consumes injera after finishing the
prayers, before leaving the church which is provided by the group of church members and these

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members feel this activity as a devotional. In Amhara region, elders gift injera to younger and
blessed to have great fortune. Similarly, in marriage, birth ceremonies near and dear gusts bring
injera to the host and considering that this provides good feature.

1.1 Background

To introduction to yeast its instant yeast can be known by several different names these include

 Quick rise yeast , rapid rise yeast,

 Fast rising yeast or bread machine yeast
 The instant type of yeast will have a quicker raising time for the dough
 Instant yeast has a much faster raising time
 Than the dry yeast known as active dry yeast and fresh yeast

The new economic policy of our country guarantees investors in the various areas of investment
incentive for investors legislated by federal and regional governments further flourished the
environment and attracted a number of local and foreign investors. As the country is part of the
world, its liberal economic policy paves market oriented economic system. The country in its
investment policy opens the door for investors in various sectors. The government has
recognized the participation of private sectors in all possible and feasible investment fields which
in effect could play vital role in satisfying the growing demand in the respective sector. Because
of the fact that the economic policy of Ethiopia is became one of the attracting nations for
investment. To this end, there is increasing private sector participation in all sectors including
manufacturing, industry, agro industry and service delivery etc. Next to agriculture, the industry
sector has a contribution of about 15% to GDP of the economy.

Hence it is accumulative experience which entities him to Food Processing in newly grow thing
sebete town. Sebeta is a town in central Ethiopia. Located in the Oromia Special Zone
Surrounding Finfinne of the Oromia Region, this town has a latitude and longitude of 8°55′N
38°37′E and an elevation of 2,356 meters (7,730 feet) above sea level. The oromia investment
commission has been exporting it is maximum effort to expand investment opportunities in the

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region so has to faster the development of the region and sub during the city being enemy that is
the trap of poverty. Therefore aside with the government duties and responsibility visited on it.

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1.2 Objectives of the Project

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 The main objective of the project is to satisfy the growing demand of highly Food
Processing Specially Injera Making for Export by supplying quality product type.

 To establish
 Injera making
 Kolo
 Yeast
 Bread Improver
 Shanty Cream,
 Snacks Nuts
 Super ghetto
 Starch and
 Other related products
More specifically the project is intended to:-

Different Related to Food Processing, factory for local and foreign to meet the increasing
demand for these type of output, production, preparation & supply of quality product services at
fair and competitive price and also important as a source of revenue for the promoter through
domestic and foreign market in which a reasonable amount of profit could be realized.

In addition to this the overall objective of the project under consideration is to contribute to the
development process in the country by taking part in the manufacturing sector.

1.3 The Product Description and Application

Food Processing, Yeast Bread, Improver Shanty Cream, Cereal, Snacks Nuts, Starch, candy,
chocolate & confectionary is processed based on a sweetener, which may be sugar or honey, to
which other ingredients are added, such as flavors & spices, nuts, fruits, vegetable fats and oils,
gelatin, emulsifiers, colorings, egg, milk products, chocolate or cacao to produce different kinds
of fruit, vegetable and other related products. The treatments of these ingredients with different
heat levels determine the types of products. This is based on the fact that when sugar is boiled, it
goes through different stages from soft to hard in crystallization process.

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The steps in yeast bread production is :- benching allow the dough to rest before shaping -
makeup and panning- proofing-baking-cooling-storing and etc

1.4 Location Map of the Area.

The project under study is planned to be located in Oromia National Regional State, Oromia
Special Zone Surrounding Finfinne, at Sebeta town 08 kebele on the south east part of the
country. The town is located at about 25 KMs away from the capital of the country/Addis Ababa.
The total land required for the project is about M2 1,500

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Infrastructure of the area is well developed (Road, Electric power, at the area and banking,
insurance, health facilities, education, etc at the town of Sebeta). Some of the reasons behind
selecting the area are:-

 Proximity to the major potential market for the out put

 Availability of relatively raw material and infrastructure facilities such as

 Transportation net works which connect it to Addis Ababa and all the regional parts of
the country.
 Public utilities such as electricity, telecommunication, services, financial institutions, and
other social infrastructures such as schools, hotel, health centers and the like.
 Availability of skilled and semi skilled man power,
 Prospective of future development.

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2. GENERAL MARKET STUDY AND PLANT CAPACITY

MARKET STUDY

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Although details market survey is not conducted, the existing information’s obtained there is
high demand for Food Processing Industry. Market is affected /determined by different factor
such as, total number of population, income level, quality of goods and services, price and
preference of the consumers and the like. Despite these factors the project under study has high
demand in local and foreign market. Therefore, the project understudy will not encounter market
problem and recommended to be expanded.

2.1. Past Supply and Present Demand

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The country’s requirement for purified water is met through domestic production and imports.
Domestic production, imports and total supply averaged at 404,950 hectoliters, 789 hectoliters
and 405,740 hectoliters, respectively. Thus, domestic production, on the average, accounted for
99.8 percent of the total supply of purified water in the domestic market, revealing the relatively
limited share of imports (0.20%) in the total supply of the product

Data on the domestic production of food processing is not available as the local production data
on different types of food processing products is not organized in a disaggregated form by
different types of food processing products.

2.1.1. Import

Ethiopia imported a total of 1.340 million USD of food products in 2011. Imports mainly enter
Ethiopia via three ports: Port of Sudan, Port of Djibouti (main port), and Port of Berbera
(Somali) [5], and from there, are transported mostly by truck, as transport by plane is very
expensive. The main imported food categories in 2011 with respect to value are listed in Table 5.
Most relevant categories are processed food, except for cereals, edible vegetables, oilseeds and
oleaginous fruits. Because of inflation over the last five years, it is wise to not consider the trend
in trade value, but rather to consider the changes in the volume imported per food product. In
2011, the total volume of food products imported in Ethiopia was 1,945 kilotons. On a product
level, the main imports are listed in Table 8. Note that it is difficult to differentiate between food
aid and real trade. In this document, this issue will not be addressed. Among the products in
Table 13 are unprocessed items, such as wheat and meslin, rice and grain sorghum. Other
processed products relevant to the project are not imported on a significant scale, and hence do
not appear in the main statistics. Such products are either not imported at all, or only on a small
scale. cane or beet sugar, palm oil and pasta, are the only processed food items showing a stable
upward trend implying an increase in demand. A declining trend is observed for malt extract.
More details on import are available from ERCA*. Interesting details on the palm oil strategy
become clear by showing the countries of origin. It can be seen that the total volume of more
than 228,000 tons in 2011, according to ERCA, corresponds to the 231,000 reported by
UNComtrade. However, the sources do not agree on Export.
Whereas in 2010, most imported palm oil (about 80%) came from Malaysia, in 2011 significant
volumes were imported from Indonesia as well. The Government of Ethiopia is responsible for

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these volumes, and in May 2013 this volume was doubled. Similar levels of detail are available
for other processed products, such aspasta and juices. For pasta, the largest volume originates
from Turkey (72%) and Oman (12%). Juice concentrates are produced chiefly (88%) in the
Middle East (55% in Saudi Arabia, 19% in the United Arab Emirates, 9% in Yemen, and 5% in
Egypt). Since value is available in these statistics, the cost price for competitiveness in domestic
production can be derived.

2.1.2. EXPORT
The export value of food and beverages in Ethiopia was 2.009 million USD, about 1.5 times the
import value. As with importing, the Port of Djibouti is the main hub for international trade.
Three food products cover 83% of the export value exported from Ethiopia: coffee, edible
vegetables and oilseeds. All these are largely unprocessed, implying that processed food is
exported on a small scale. Only meat and edible meat offal can, in some sense, be considered as
significant trade in processed food. Notwithstanding its enormous share in trade value, coffee is
not at the top of export volume from Ethiopia. Together with oilseeds and oleaginous fruits and
dried leguminous vegetables, coffee represents 2/3 of the total food export volume of 992
kilotons in 2011. As with import, not many processed categories are exported at a significant
level. The other processed food categories exported.

proportions. The traditional preparation of injera batter was presented in Fig. 3. Depending on
the requirements, grains used to prepare by removing the inferior quality grains and dust like
chuff and other unwanted materials. Further, all the cereals used to converts into flour by the
commercial mills (disc mills are the commonly used). It is a practice to mix one part of flour
with two parts of water and about 16 % “ersho” by weight of the flour [22, 27, 28]. The container
used to mix the components called as “bohaka” which made of clay, metal or wooden
container. The flour, water and ersho are meticulously mixed by hand stirring to form a thin,
watery paste and left for primary fermentation around 30 to 72 hours [28]. However, the
fermentation time depends on the altitude (which determines the temperature) of the area,
the concentration of the ersho and the type of the container used Scientific study reported that,
ersho contained 96.4% moisture, 0.05 mg riboflavin/100 g, and 0.4 mg of niacin/ 100 g [29].
Ashenafi reported the pH of ersho samples was about 3.5 and titratable acidity was

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ranged among 3.1% - 5.7% [30]. Some researchers used varying amounts of teff flour to
water ratio in teff flour fermentation. The flour to water ratio varies in literature from 1:1 to 2:3.
The flour: water ratio of 1:1 was used by Abraha, et al., (2013) [31], 1:2 was used by Ashagrie
and Abate, (2012) [28], Girma et al., (2013) [27] and Abiyu et al., (2013) [32] , while a ratio of
2:3 was used by Zegeye (1997) [22], 1:1.6 was used by Girma et al., (1989) and Mary et al.,
(1989) [33,34]. The time for ceases finest fermentation considered by the gas formation and the
dough and small portion of the liquid phase separation on the surface [1]. Time required for the
fermentation effected by diverse factors like, microbial flora of ersho and flour, fermentation
temperature and the cleanliness of the container used. After about 48 to 72 hours of primary
fermentation, fraction of the fermented mix is gelatinized by cooking to form “absit” which
usually used to added back to the fermentation batter (in primary fermentation), this step initiates
the ‘secondary fermentation’. Mihrete, (2019) [35], Zegeye, (1997) [22], Desiye et al., (2017)
[36], Wendy Darling Attuquayefio, (2014) [23], Beruk and Fasil (2017) [37], Ronda, (2019) [38]
used 10% of Absit in their research studies. However, there is a difference in the water ratio and
time and cooking temperature used for preparation of absit. In contrast, few studies like
Chemeda & Bussa, (2018) used 200 ml of the fermented mixture was added with 400 ml of
water and brought to boiled and added back to 1kg of original flour [39]. Finally,the most of the
researchers concluded that, absit is a gruel work as a dough binder in the course of secondary
fermentation of dough. After cooling back to about 46°C, absit reported to be mixed into
fermenting vat for the second phase of fermentation which allowed for about 2 h. After adding,
absit develops the gas formation and causes the paste to rise [40]. Adding absit is also critical to
develop the desired texture and consistency, as injera made without absit tends to be powdery
and have fewer eyes which are not liked by Ethiopian consumers. It is conformed that, teff,
millet, and corn are the only grains that require absit during the process of making injera [29].
Finally, researchers reported that absit has a significant influence on the physico-chemical and
sensory quality of injera. Once fermented batter is ready after the successful primary and
secondary fermentations, injera griddled by pouring about two-third liter of the batter onto the
hot greased plate known as “metad” (injera griddle made of clay) using circular movement from
the peripheries to the center (Fig. 4 C, D), by closing a lid known as “kidan” (Fig. 4E). For this
poring process a special plastic device used known as “Mazoria” (Fig. 4 A). It was reported

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that, injera cooks about 2-3 minutes at metad temperature of 90-95 oC [41]. Rapeseed oil is a
common lubricant used to grease the metad between each injera baking. Several layers of injera
traditionally stored in a ‘messob’ (traditional straw basket) (Fig. 4 H, I) with tight packing in
polythene cover. It is a traditional practice for preservation of injera for three days in a cool, dry
and ventilated place.
Scientific Research on Injera
Limited research was reported on the major areas of injera preparation. One of the well studied
parts was development of injera from composite flours for the improved nutritional and sensory
quality. In contrast, limited research reported on microbial characterization of the fermented
batter, preservation of injera, degradation of the anti-nutritional factors and effect of processing
methods on quality of the injera. However, research on the energy requirements, development of
the injera cooking pans were developed and reported well. Moreover, a well reviewed document
on the injera baking technologies was published by Adem and Ambie (2017) [42]. The following
sections are composed of the research reported on the scientific research done on different
aspects of injera. Scientific studies reported on Composite flours for injera As the injera
preparation usually only from the cereals, nutritionists are evaluated injera is limited in protein
and rich with anti-nutritional factors like tannins. However, due to the high price of the teff,
preparations of the injera with the other low cost alternatives were investigated. Some
researchers were investigated the affects of functional ingredients like fenugreek and
flaxseed on injera nutritional and sensory quality.

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+6

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2.3. Pricing and Distribution

The price of different types of Food processing varies based on their quality and size specially
injera. The recommended price for the new project is, therefore, Average one quintals of teff
1,000 injera one injera Birr 5 up to 10 Ethiopia birr.. Food processing of the new project will
have the ex-factory price of different. For instance, there is different price of injera but the
majority price is 10 birr.

The products will be distributed through the existing outlets and direct delivery to major
distributors.

2.4. PLANT CAPACITY & PRODUCTION PROGRAMME

1. Plant Capacity
Based on demand projection indicated in the market study, the suggested plant capacity is
produces this per annum.
Note: One quaintly teff 1,000 injera one injera 10 birr per day 500 injera.
S/N Production unit Capacity One One Total production
price Qntly
Price monthly Annual

1 Teff Kg 1,000 10 10,000 150,000 40,500,000

2 Injera
Improver: - Kg 10,000*5 50,000 1,800,000
High mix 10,000*10 100,000
Magi mix
Yeast and
other related
Note: - all market shares are for export and domestic market

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The plant is envisaged to operate in double shift of 16 hours a day for 270 days a year. This is
excluding 13 holidays and 52 Sundays, and assigning 30 days for executing repair and
maintenance programmed of the production equipment.

2. Production Programmed
The plant is expected to first operate 75% and second round production 85% of the installed
capacity in the second years, respectively. The plant will reach full capacity on the third year.
The rationale behind such production build-up is that the production equipment is new, and
operators usually take some time to develop the specific skills and knowhow.
3. Utilities

Electricity and water are utilities required for the plant. Electricity is required as motive power
and to supply lighting and sockets. Water is required for human consumption and general
purposes. The annual consumption of electricity and water is given in Table

Sr. No. Description Qty Unit cost (Birr) Total cost

(Birr)
1 Electricity (kWh) 18,000 0.58 9,503
2 Water (m3) 500 10.00 5,000
Total 14,503

2.5. Land requirement and land use plan

The area of land required for the proposed project is estimated to be 1,500 M2. The land
requirement of the project has been decided by taking the dimension of building and for other
facilities. The detail information is as follows:

 Production Hall -------------------------------------------------------------- 800 m2

 Office building ---------------------------------------------------------------- 200 m2
 Guard house------------------------------------------------------------------- 50 m2
 Toilet and shower room---------------------------------------------------------50 m2
 Warehouse -------------------------------------------------------------------- 100 m2
 Raw material Store ---------------------------------------------------------- 100 m2

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 End product Store ---------------------------------------------------------- 100 m2

 Show room -------------------------------------------------------------------50 m2
 Parking and others ----------------------------------------------------------- 50 m2
Total land requirement ---------------------------------------------------- 1,500 M 2

2.6. TECHNOLOGY AND ENGINEERING

A. TECHNOLOGY
1. Production Process
To produce and provide quality product the project with greater efficiency, modern and
sophisticated machineries and equipments will be acquired both from local and overseas market.

There are a variety of chewing gums in the market depending on the types of input combination,
processing techniques, the duration & technology of production applied. Corn syrup, sugar,
flavoring and coloring agents are the main ingredients in gum making process. Proportion of the
inputs consists of around 63% sugar, 16% corn syrup and 1% flavoring oils. These agents are
produced under rigidly controlled temperature conditions at 115 degree centigrade. It then passes
through several and the thick maple syrup flattened by sheet rolling machine into thinner sheets
until the desired output is achieved. Yeast Bread, Improver Shanty Cream, Cereal, Snacks Nuts,
Starch, candy, chocolate & confectionary have several benefits sensitizes consumers. Refreshing
nature, moisturize the mouth, stimulating saliva production that helps to neutralize tooth decay
forming acids left b/n tooth cavity after eating fermented food, and more importantly for
enjoyment. Moreover, several research findings have shown that chocolate, candy and chewing
gum also helps to curb a person’s appetite for snacks and cigarettes; it also has significant
contribution in helping to make full concentration, stay alert, ease tension and relax one’s nerves
and muscles.

B. ENGINEERING

1. Machinery and Equipment

Total cost of machinery and equipment is estimated at Birr 2,630,000, Machinery and equipment
required for the production of Food Processing along with estimated costs.

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References: - Alibaba.com global trade start here

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3. MANPOWER, OGANIZATION STRUCTURE AND MANAGEMENT

1.1.1. 3.1 Man Power

At the top of the organization structure, there will be a general manager with the responsibility of
supervising the overall activity of the plant. It is always true that Organization and Management
of the project plays a key role and bear direct impact on the success and profitability of the
project. The opportunities of being serviced by well skilled professionals well enable the
company to evaluate the internal weakness and strength of the company as well as to assess the
global opportunity and risks in the world market so that the company can cope up with the
dynamics of the market situation.

Therefore, it must particularly to the project under consideration, to give especial affection to
select and recruit the appropriate total manpower requirement for the plant will be employees at
full capacity.

I) Permanent Workers :- 100

 Skilled :-30
 Unskilled:-70
II) Temporary Workers:-200
 Skilled :-100
 Unskilled:-100

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3.1.2. Salary Expense

The total number of manpower, manpower list, qualification, and salary and sex composition are
listed in the table below.

Monthly Annual
SN Description No Qualification
Salary Salary
1 General Manager 1 BA in Business Management 4,000.00 48,000.00
2 Production Manager 1 BSC in industrial Engineering 3,500.00 42,000.00
BSC in Production
3 Supervisor 1 3,000.00 36,000.00
Technology
Diploma In Secretarial
4 Secretary 1 1,500.00 18,000.00
Science
Public Relation
5 1 Dip in Social Science 1,800.00 21,600.00
Officer
6 Personnel 1 Dip in HRM 1,500.00 18,000.00
7 Planning Officer 1 Dip in Economics/Statistics 1,900.00 22,800.00
8 General service 1 Dip in management 1,500.00 18,000.00
Diploma in Chemical
9 Color Operator 1 1,500.00 18,000.00
Engineer
10 Hydraulic Technician 1 10+2 in general Mechanic 1,500.00 18,000.00
11 Machine Operators 4 10+2 in general Mechanic 1,800.00 86,400.00
12 Marketing head 1 BA in Marketing management 2,000.00 24,000.00
Diploma in Purch. & Suppli
13 Purchaser 1 1,500.00 18,000.00
mgt
14 Administer 1 Dip in Management 1,500.00 18,000.00
15 Sales person 3 Diploma in sales management 1,500.00 54,000.00
16 Finance head 1 Dip in Accounting 1,500.00 18,000.00
17 Accountant 1 Diploma in Accounting 1,500.00 18,000.00
18 Electrician 1 10+2 in general electricity 1,500.00 18,000.00
19 Cashier 1 10+2 in bookkeeping 1500 18,000.00
20 Cleaner 4 Unskilled 1500 72,000.00
21 Driver 2 10 completed 1500 36,000.00

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22 Gardner 2 Unskilled 1500 36,000.00

23 Guards/Security 4 Basics 1500 72,000.00
Total Permanent
  36   1500 648,000.00
workers
24 Helpers and laborers 264 10 completed 1600 5,068,800.00
  Grand Total 300     6,562,800.00

3.1.3 Organizational Structure

The organizational structure of the project is designed by including all the necessary personnel
under the right division. At the top of the organizational structure, there will be manager with the
responsibility of supervising the overall activity of the plant. Depending up on the nature of the
center and the amount of work to be performs; there exist auxiliary units under the general
manager.

Employees under each unit will be supervised by the department head that is accountable for the
general manager. General Manager is appointed by the owners.

Owner

General Manager

Executive
Secretary

Production
Department Admin & Finance Commercial
Department Department

Pre- Packing
treatment
Admin. & Financial
Inspection HRM
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Marketing Sales
Fig: Organizational Structure

Hence the following section deals with the duties and responsibilities of some departments.

3.3. Organizational Management Duties and responsibilities

1. General Manager
Duties and responsibilities

 She/he will plan, organize, direct and control the overall activities of the factory
 She/he will devise policies and strategies that will enable the factory to be profitable.
 She/he will incorporate modern technological innovation that will facilitate the service
delivery of the project center and increase customer’s satisfaction.
 He/he will plan, organize, direct and control the human and non-human resources of the
plant so as to achieve the short and long run objectives of the organization.
2. The Manufacturing Department
Duties and responsibilities:-

It is the core department of the project center and has the following responsibilities.

 Use modern manufacture, processing and technologies that will enhance the quality
of those products.
 Produce quality product that will enable the center competent both in the domestic
and international market.
 Use appropriate technology to manage its products.
 Control on the quality of raw materials, inputs, quality of the product and also the
overall production process.
 Produce products in least cost so that the profitability of the center is guaranteed.
 Moreover control over the quality of the final products
3. Administration and Finance Department
Duties and responsibilities:-

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 Will plan, organize direct and control the financial transaction of the plant by using the
entire necessary document.
 Will develop sound financial control system by developing modern financial control
systems.
 Will prepare the annual financial statements and prepare condensed reports for the
general manager, owner and other concerned government body.
 Will control the human and non human resources of the plant, which include: effective
handling of the different inventories of the machineries, equipments, raw materials,
finished products, and devise strategies of controlling against fraud and damage.
 Manage and execute The promoter national and international procurement procedure
 Administer and control The promoter logistic resource
 Effectively administer the promoter Procurement process domestically as well as
internationally.
 Manage the public relation of The promoter/factory with external parties/stakeholders
 Provide and manage general supportive service to the plant.
4. Commercial Department
Duties and responsibilities:-

 Will handle the overall marketing activities of the organization which include planning,
organizing, directing, and controlling.
 Provide cost estimates in preparation for securing ...
 Gather information on new product design, profile
 Approval of new products profile & brand plan analyzes market research.
 Plan and execute sales.
 Will develop effective customer handling strategies
 Will design and implement effective advertisement and promotion schemes
 Will develop the marketing strategies for future project center’s development.
 Conduct both foreign and domestic market research for expanding the sales of The
promoter
All workers have responsibilities on each activity they assigned for.

B. TRAINING REQUIREMENT

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The production supervisor and skilled workers require few weeks training on machine operation
and production technology. Training is assumed to be entertained during the erection and
commissioning period and the cost is in built there and hence about Birr 25,000 is sufficient to
cover expenses associated with the training programmed.

4. FINANCIAL REQUIREMENT AND ANALYSIS

4.1. Total Initial Investment Cost

The total cost of money that is required to estimated the envisaged Food Processing product is to
be birr 100,000,000.

Table Total Initial Investment Capital

No Description Cost
1 Land, Building and Construction 00
37,400,000
2 Machinery and Factory Equipments 00
26,300,000
3 Office Equipments 00
988,880
4 Vehicles and Motors 00
10,300,000
Total Fixed Investment Cost 00
74,988,880
5 Raw Material and Input 00
15,749,050
6 Salary Equipments 00
6,562,800
7 Other Operating Expenses 00
1,909,270
8 Pre Service Expense 00
790,000
Total Initial Working Capital 00
25,011,120
Total Investment Cost 00
100,000,000

4.1.1. Fixed Investment

Building and Construction
No Description Land requirement (M2) Unit cost in Br. Total Cost in
Br.
1 Production Hall 13,414 1860 24,950,0

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2 Office Building 900 1,800,0
2,000 00
3 Guard house 900 225,0
250 00
4 Toilet and shower room 700 175,0
250 00
5 Warehouse 1100 1,650,0
1,500 00
6 Raw material Store 1200 3,600,0
3,000 00
7 End product Store 1200 2,400,0
2,000 00
8 Show room 1100 1,100,0
1,000 00
Parking and others 1000 1,500,0
1,500 00
Total 9960

4.1.2. Required Machinery

Machinery and Equipment cost
No Description Qty Unit Price Total Cost (Birr)

1 Small Sachet packing machine bread and injera 3

powder pack)
1000000 3000000
1 Fleischmann’s yeast for injera machines with
all accessory
2 11650000 23300000
Total
26300000

4.1.3. Vehicles
SN Description Qty Unit Price Total Price(Birr) Remark
1 Pick Up 7,500
1
,000 7,500,000 Duty Free
2 Worker Service bus 2,800
1
,000 2,800,000 Duty Free

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Total 10300000

4.1.4. Office Equipment’s

SN Description Qty Unit cost(Br). Total cost (Br).
1 Managerial chair with tables 30 5,000.00 150,000
2 Secretarial chairs with table 10 1,650.00 16,500
3 Office Chairs with tables 60 1,350.00 81,000
4 Computer with printer 20 15,000.00 300,000
5 Shelf 10 3,500.00 35,000
7 Telephone machine set 20 1,500.00 30,000
8 Filing Cabinets 20 2,000.00 40,000
9 Assembly chair and table     261,380
10 Decoration(Carpet & Curtain)     75,000
Total     988,880

4.2. INITIAL WORKING CAPITAL

The initial working capital is established to be 25,011,120.00 birr
4.2.1. Pre -Service Expense
SN Description Cost in br.
1 Project proposal 80,000
2 Licensing fee and others 10,000
3 Promotion and adverting 200,000
4 Workers capacity Building 500,000
  Total 790,000

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4.2.2. Material and Inputs

A. Raw and Auxiliary Materials
The major raw materials and auxiliaries required for the production of Food Processing shown in
Table 4.1 below. All the raw and auxiliary materials are to be imported.
Sr. Description Unit Of Annual Unit Price Total Price
No. Measure Quantity (CIF) (CIF)
1 Different Food Processing tone 2,862 5,502 15,749,050
materials(teff for injera
Total
15,749,050

4.2.3. Salary Expense

As indicated in part three of this study, the total cost of salary and wage is estimated to be
6,562,800.00 birr.

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4.2.4. Other Operating Expenses

SN Description Annual Cost in Br. Assumption Used
1 Property Insurance 300,919.50 10% of Fixed investment cost
2 Audit and Legal Fee 100,000.00 10% of Salary
3 Uniforms 16,000.00 1% of FC
4 Telephone, Fax and Postal 10,000.00 1000per month
5 Cleaning Gods Supplies 20,000.00 70*60br
6 Repair and Maintenance 502,298.80 900 per month
7 Advertisement 20,000.00 1000 per month
9 Stationery and other office 700 per month
supplies 10,000.00
10 Electricity 10,000.00 0.45*150,000W per year
11 Water 5,000.00 2*1000 m3 per year
12 Fuel 900,000.00 6500 lit*20 per year
13 Oil and lubricant 10,000.00 10% of fuel cost
14 Miscellaneous Expense 10,000.00 3,000 br month
  Total 1,909,260.00  

4.3. Financial Analysis and Statements

4.3.1. Underlying Assumption

The financial analysis of the envisioned Food Processing industry is based on the data provided
in the preceding sections and the following assumptions.

A. Construction and Finance

 Construction Period ………………………………………………………….…18 Months

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 Source of finance……………………………………………..…30% equity and 70% loan

 Bank interest rate …………………………………………………………..…………10 %
 Tax holidays ………………………………………………………………………2 years
 Operating costs increase by……………………………………………..………………2%
 Operating costs and raw material increased by………………………………...………5%
 Utilities and operation expense …………………..…increase 3% per annum after 2ndyear
 Wages and Salary increase…………………………Increase 3% Per annum after 2 nd year

 Sales …………………………………………..increase by 5 % per annum after 2nd year

B. Depreciation
 Building…………………………………………………………………………….5%
 Machinery and Equipment ………………………………………………………..10%
 Office Furniture……………………………………………………………………10%

 Vehicles ………………………………………………………………………..…..20%

C. Working Capital
 Accounts Receivable…………………………………………………………….30 days
 Raw material Local …………………………………………………………..…..30 days
 Work in progress…………………………………………………………………5 days

 Finished Production ……………………………………………………………..30 days

 Cash in hand ……………………………………………………………………...5 days
 Accounts payable …………………………………………………………….…..30 days

4.3.2. Source of Fund

SN Description % share Amount(in birr)
1 Owners Share 30 30,000,000
2 Bank Loan 70 70,000,000
Total 100 100,000,000

4.3.3. Loan Repayment Schedule

Principal Interest Total Annual
Year Remaining Balance
Payment (10%) Payment
0 0 0 0 70,000,000
1 7,000,000 7,000,000 14,000,000 63,000,000
2 7,000,000 6,300,000 13,300,000 56,000,000

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3 7,000,000 5,600,000 12,600,000 49,000,000

4 7,000,000 4,900,000 11,900,000 42,000,000
5 7,000,000 4,200,000 11,200,000 35,000,000
6 7,000,000 3,500,000 10,500,000 28,000,000
7 7,000,000 2,800,000 9,800,000 21,000,000
8 7,000,000 2,100,000 9,100,000 14,000,000
9 7,000,000 1,400,000 8,400,000 7,000,000
10 7,000,000 700,000 7,700,000 0

4.3.4. Annual depreciation schedule of the fixed Asset ( birr)

Description Initial value Annual depreciation

Rate Value
Building & construction 37,400,0 5%
00 1,870,000.00

Machinery& Equipment 26,300,0 10%

00 2,630,000.0

Office furniture & equipment 988,8 10%

80 98,888.0
Vehicles 10,300,0 20%
00 2,060,000.0
Total - - 1,870,000.00
4.3.5. Balance Sheet (Beginning)

Asset
Current Asset Value in Br
Cash 9,262,070
Inventory of raw material and input 15,749,050
Total Current Asset 25,801,120
Fixed Asset -
Land, Building and Construction 37,400,000

Machineries and Equipment 26,300,000

Office Equipment 988,880

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Vehicles 10,300,000

Total Fixed Asset 74,988,880

Total Asset 100,000,000
Liability -
Account Payable 70,000,000
Owner Equity -
Capital 30,000,000
Total Liability and Owners Equity 100,000,000

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4.2.7. Profitability

According to the projected income statement, the project will start generating profit in the 1st
year of operation. Important ratios such as profit to total sales, net profit to equity (Return on
equity) and net profit plus interest on total investment (return on total investment) show an
increasing trend during the lifetime of the project.

The income statement and the other indicators of profitability show that the project is viable.

4.2.8. Pay-Back Period

The investment cost and income statement projection are used to project the pay-back period.
The project's initial investment will be fully recovered at the 3 years of operation.

5. ENVIRONMENTAL IMPACT ASSESSMENT OF THE PROJECT

5.1 Socio Economics Environments

The owner will provide the land on bases and all required compensation will be paid for the
project. The livelihood of the local people around the project area is rural dweller of various
occupation and economic background.

5.2 Environmental Impact Assessment of the Project

Environmental aspects are fundamental for the sustainability assessment of the current
competition marketing related plant. In this regard the factory will undertake a separate and
detail Environmental impact Assessment.

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