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Team:Manchester/businesstest5
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Revision as of 22:03, 28 October 2013 by LornaHepworth (Talk | contribs)
Once the methods described during this project have been fully optimised, we believe that the ideas presented here have the potential to become a real player in the palm oil market. Producing the main palm oil components the E. c(oil)i way would drive down costs and, more importantly, safeguard the remaining rainforests. The following pages are a summary of our business plan, and the full document can be found by clicking on the button to the right.
Financial Summary
| Feedstock costs if using Agricultural Waste (million USD) | Water (million USD) | Labour (million USD) | Output (million USD) |
| 8.1 | 0.0036 | 0.738 | 9.374 |
| Total Profit/Loss | 0.5324 |
Of course, there are other costs, such as transportation and sales, which we are unable to account for at this time. However, with an estimated $532,400 surplus per month, we believe that even with these additional costs, we have created an economically viable product. It is also important to consider that, should we move this industry back to Malaysia, we would expect running costs to decrease.
At this level of output, we would be looking at a payback period of around 300 months (25 years) after the original $155.95 million outlay.
However, it is extremely possible that we will see massive increases in the price of palm oil over the next few decades (reasons for this are detailed in our Impact Analysis Report ). This increase would see the profits of this venture rocket - a very modest (and extremely likely) increase of just $10 would see the profits increase by over $138000.
Another factor to consider is that our product will have already skipped many of the refinement processes necessary for use of the palm oil. As refined palm oil currently has a price of $910, it is possible to suggest that the price of our palm oil would actually be much closer to this figure, as we have already separated out the fatty acids in our 3 batch process and further decontamination steps. At a retail price of $910 per tonne, would lead to over a $2 million increase in profit at a plant of this size. This would reduce the payback period to just 61 months (5 years), making this a very appealing economic investment.
References
[1] Diabetes Forecast, July 2013
[2] Photo © espensorvik
