BUSINESS IDEA FOR MAKING DECORTICATED CASHEW NUT

 

Introduction

This business plan calls for the manufacturing and marketing of edible cashew nuts. It is based on the assumption that 5,200 kg of cashew nuts will be produced each month, or 62,400 kg year. The potential income is thought to be $6,500 USD each month, or $78,000 annually. Cost of the project is US$53,280.

Production process

In the automated approach, a hand-operated machine positioned on a work table is used to decorticate the raw cashew nuts. When the decorticator is positioned between two blades that are installed horizontally and are distributed specifically to fit the raw nut's curve, the nut is split. The blades' sliding and splitting motion easily splits the outer shell. A worker may process 25 to 30 kg of nuts per day.

Production Capacity

The plant can have a capacity 9000 kgs per year

Market Analysis

On the global market, cashew nuts are highly sought-after. Even though cashew nuts are not widely available throughout Uganda, there is still a local market. Given that there is little rivalry and an open market for cashew nuts, this could prove to be a game-changer in their marketing.

Capital Investment Requirements in US Dollars.

Item	unit	quantity	Unit cost	total
Cashew decorticator	No	1	1,000	1,000
Other equipment	No	1	100	100
Delivery van	No	1	2,500	2,500
Total cost machinery				3,600

 

Production and Operating Costs in US $ Direct Materials, Supplies and Costs

Cost item	units	Unit cost	Qty/day	Prod cost/ day	Prod cost/month	Prod cost/year
Cashew nuts	kgs	0.5	300	150	3,900	46,800
Sub total					3,900	46,800

 

General cost	Prod. Cost/ month	Prod. Cost/ year
Power	15	180
Water	15	180
Salaries	60	720
Rent	75	900
Depreciation	75	900
Sub total	240	2,880
Total operating cost	4,140	49,680

 

Costs of production were calculated using a daily capacity of 200 kg of cashew nuts over a 312 day year. Depreciation (the write-off of fixed assets) assumes a write-off rate of 25% per year for the whole asset life of four years. Materials, supplies, and other expenses directly related to the manufacture of the good are considered direct costs.

Project Product Cost and Price Structure in US$

Item	Qty/day	Qty/yr	Unit cost	Prod cost/ year	Unit price	Total revenue
Decorticated cashew nuts	200	62,400	0.5	31,200	1.3	78,000

 

Profitability Analysis in US$

Profitability item	Per day	Per month	Per year
Revenue
Cashew nuts	250	6,500	78,000
Less prod & operating cost	159	4,140	49,680
profit	91	2,360	28,320

 

Source of Supply of Equipment and Raw materials

Equipment can be imported from Asia and Europe; however, Rawmaterials can be sourced from local farmers

Government positivity 

Government is encouraging Agro-processing Industries that would provide employment to natives