1.5 Mini Ice Plant Pre Feasibility Study

1.35 MT MINI ICE PLANT BUSINESS OPPORTUNITY PROJECT SUMMARY

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SOPREX Foundation SOPREX/MIND-BIOS Bldg., MSU-IIT Campus A. Bonifacio Ave. Tibanga, Iligan City. 9200 (063) 223-8077 / FAX: (063)2238481

Partnerships in Local Enterprise Development and Governance Sustainability (PLEDGES) Program BUSINESS OPPORTUNITY PROJECT SUMMARY

1.35 MT Mini Ice Plant PROJECT CONCEPT/DESIGN: The 1.35 MT Mini-Ice Plant is designed to produce both crystal cube ice to meet the requirements of food establishments for high-quality beverage cooling ice and iced foods, e.g., halo-halo, and regular block ice for general home consumption as well as for preservation and transport of highly perishable goods such as fish and meat. For both ice products, the system filters and purifies the raw water supply, hence both are actually food-grade. However, to meet the quality standards of high-end markets, e.g., hotels and restaurants, the system incorporates the technology of crystallizing the ice to produce the crystal ice cubes in demand in these special establishments. Using a V-type or belt-driven 5HP compressor, the plant can operate continuously during power outages by using a small stand-by diesel generating set of 7HP or more. For this reason, the Mini-Ice Plant can also be located in remote fishing villages where electricity is not available.

DAILY/ANNUAL ICE PRODUCTION CAPACITY: 1.35 MT/486,000 MT SELLING PRICES: Crystal Cube Ice – PhP 35 per 10 kg bag; Mini-Block Ice (15 kg) – PhP 22.50 (PhP 1.50/kg) ANNUAL GROSS INCOME: PhP 1.2 million ANNUAL OPERATING INCOME: PhP 342,378 ESTIMATED TOTAL PROJECT COST: PhP 1.62 million COST OF ICE-MAKING PLANT MACHINERY & EQUIPMENT: PhP 870,000 RETURN ON INVESTMENT RATE (R0I) /PAYBACK PERIOD: 21.1% p.a. / 4.7 years FOR MORE INFO, PLEASE CONTACT: SOPREX Foundation MSU-IIT Campus, Tibanga, Iligan City 9200 Tel./Fax: (063)223-8481/223-8077 Cell Phones: 0918933172 (Maya); 09189420065 (Yesnoy)

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1.35 MT MINI ICE PLANT

Cost and Returns Analysis

Table 1. Production and Operating Parameters 360 Days Per Year Operation 1. Production Volume a. Min-Blocks (pcs) b. Ice Volume (kgs) @ 15 kg/can c. Crystal Cube Ice @ 60% of total volume d. Regular Ice @ 40% of total volume 2 Water Consumption (CM) @ 110% of ice volume 3 Power Consumption (kwhrs) a. Ice Making @ 114 kwhrs/day b. Ice Cutting/Crushing @ 5 kwhr/day c. General Use @ 5 kwhr/day Total: 4 Packaging Materials @ PhP10.00 /10 kg bag of ice cubes 5 Labor Cost 1 Proprietor/Cashier 1 Plant Operator/Clerk 2 Laborer Total Basic Salaries & Wages ADD: 15% SS & Other Benefits Total Labor Cost

Daily

Annual

90 1,350 810 324 1.49

32,400 486,000 291,600 116,640 535

114 5 5 124 81

40,867 1,800 1,800 44,467 29,160

250 200 150 600 90 690

75,000 60,000 45,000 180,000 27,500 207,000

Table 2. Projected Income and Returns Gross Sale of Ice: Crystal Cube Ice @ PhP 3.50 /kg Regular Ice @ PhP 1.50 /kg Total Sales LESS: Production Expenses Production Labor Salaries/Wages & Other Benefits Materials & Supplies Water @ PhP 20.00 /CM Power @ PhP 4.50 /kwhr Repair & Maintenance Exp. @ 5% of F.A. except land Depreciation Exp. @ 10 yrs average eco-life of F.A. excluding land Miscellaneous Production Overhead @ PhP 20/day Total Production Expenses Gross Profit LESS: Administrative & Selling Expenses Proprietor/Cashier Salaries & Other Benefits Other Adm./Selling Overhead @ 5% of gross sales Total Administrative & Selling Expenses Operating Income ROI on Total Project Cost (% Per Annum) Payback Period (Years) 1.35 MT MINI ICE PLANT

2,835 486 3,321

1,020,600 174,960 1,195,560

403 81 30 556 196 384 20 1,670 1,165

120,750 29,160 10,692 200,102 58,913 115,325 6,000 540,942 479,658

288 142 429 736

86,250 51,030 137,280 342,378 21.1% 4.7

Cost and Returns Analysis

Table 3. Estimated Total Project Cost ITEM A

B.

C.

COST (PhP)

Pre-Operating Expenses 1 Business Organization & Registration/Licensing 2 Construction Supervision @ 25% of Fixed Assets except land 3 Training & Technology Transfer Total Fixed Assets Acquisition Cost 1 Land and Land Improvements a. Land: 100 sqm @ P250/sqm b. Site Dev't. (earthworks): 100 sqm @ P500/sqm c. Plant & Office Building: 40 sqm @ 4,500 d. Water & Power Service Connections Sub-Total 2 Plant Machinery & Equipment a. Mini Ice Plant b. Ice Crusher c. Assorted Materials Handling Tools & Equipment d. Add: Freight/Handling & Installation/Test Run @ 15% Sub-Total 3 Office Equipment/Furniture/Fixtures Sub-Total Total Initial Working Capital (2 Months) TOTAL PROJECT COST BEFORE CONTINGENCY ADD: 10% contingency TOTAL PROJECT COST INCLUDING CONTINGENCY

50,000 100,000 50,000 200,000

25,000 50,000 180,000 5,000 260,000 750,000 2,500 2,500 113,250 50,000 868,250 1,178,250 93,816 1,472,066 147,207 1,619,273