Mineral Water

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44. MINERAL WATER

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TABLE OF CONTENTS
PAGE
I.

SUMMARY

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II.

PRODUCT DESCRIPTION & APPLICATION

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III.

MARKET STUDY AND PLANT CAPACITY

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A. MARKET STUDY

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B. PLANT CAPACITY & PRODUCTION PROGRAMME

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RAW MATERIALS AND INPUTS

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A. RAW MATERIALS

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B. UTILITIES

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TECHNOLOGY & ENGINEERING

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A. TECHNOLOGY

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B. ENGINEERING

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MANPOWER & TRAINING REQUIREMENT

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A. MANPOWER REQUIREMENT

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B. TRAINING REQUIREMENT

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FINANCIAL ANLYSIS

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A. TOTAL INITIAL INVESTMENT COST

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B. PRODUCTION COST

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C. FINANCIAL EVALUATION

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D. ECONOMIC BENEFITS

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IV.

V.

VI.

VII.

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I.

SUMMARY

This profile envisages the establishment of a plant for the production of Mineral Water with a capacity of 14.4 million liters per annum.
The present demand for the proposed product is estimated at 32 million liters per annum. The demand is expected to reach at 108 million liters by the year 2010. The plant will create employment opportunities for 54 persons. The total investment requirement is estimated at Birr 16.4 million, out of which Birr 1.8 million is required for plant and machinery.

The project is financially viable with an internal rate of return (IRR) of 13.46% and a net present value (NPV) of Birr 6.1 million, discounted at 8.5 %. II.

PRODUCT DESCRIPTION AND APPLICATION

The simple definition of water is that it is the liquid that descents from the cloud as rain, forms streams, lakes and seas, issues from the ground in form of springs and is a major constituent of all living matter and that when pure consists of an oxide of hydrogen H2O or (H2O)x in the proportion of 2 atoms of hydrogen to one atom of oxygen and is an odorless, tasteless, very slightly compressible liquid. Water freezes at 0oC and boils at 100oC, has a maximum density at 4oC and a high specific heat contains very small equal concentration of hydrogen ions and hydroxide ions, reacts neutrally and constitutes a poor conductor of electricity, a good ionizing agent and a good solvent.

The present study considers bottling, packing and distribution of mineral water. III.

MARKET STUDY AND PLANT CAPACITY

A.

MARKET STUDY

1.

Past Supply and Present Demand

Demand for mineral water in Ethiopia is met through local production except for insignificant import. The domestic suppliers were for a long time a few public sector companies. Ambo Mineral Water is the most reportable among these, enjoying the largest share of the market in most parts of the country. Tossa and Babile had also a long history of supplying mineral water through their geographic reach, which is limited to specific regions. The private sector supplier is Bure Baguna which is located 410 km north-west of Addis Ababa. Currently, Moha Soft Drinks S.C is refurbishing the Bure Baguna Mineral Water Factory which it bought from the Ethiopian Development Bank after it was foreclosed following the failure of the owners to pay their debts.

Table 3.1 shows the combined production volume of mineral water by all local producers in a ten years period (1985-1994).

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Table 3.1
DOMESTIC PRODUCTION OF MINERAL WATER
Year
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994

Production (Liters)
15,926,000
19,928,500
29,837,700
35,775,410
37,425,700
39,006,800
42,141,700
39,976,410
39,545,100
39,463,200

Source: CSA, Survey of the Manufacturing and Electricity Industries, Annual Issues. Scrutiny to Table 3.1 will reveal that the supply of mineral water had nearly doubled in 1987 from the base figure of about 16 million liters. Subsequent years were also marked by significant growth and the supply reached the peak volume of 42 million liters in 1991. Since then, supply of mineral waters appears to have stabilized around 40 million liters per annum. The per capita consumption that derives...
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