APRIL 7, 2018

MATERIALS PROCESSING PLANT DESIGN

MME 440

JANIBUL HAQUE
STUDENT ID: 1411043
Level/Term: 4/1
Plastic Bottle Manufacturing
The manufacture of plastic bottles takes place in stages. Typically,
the plastic bottles used to hold potable water and other drinks are
made from polyethylene terephthalate (PET), because the material is
both strong and light. To understand the manufacturing process it’s
helpful to first examine the composition of PET and how this affects
plastic bottles.

Polyethylene Terephthalate (PET)

PET is a thermoplastic polymer that can be either opaque or transparent, depending on the
exact material composition. As with most plastics, PET is produced from petroleum
hydrocarbons, through a reaction between ethylene glycol and terephthalic acid. To produce
plastic bottles, the PET is first polymerized to create long molecular chains.

Polymerization itself can be a complicated process, and accounts for many of the
inconsistencies between one batch of manufactured PET and another. Typically, two kinds of
impurities are produced during polymerization: diethylene glycol and acetaldehyde. Although
diethylene glycol is generally not produced in high-enough amounts to affect PET, acetaldehyde
can not only be produced during polymerization, but also during the bottle manufacturing
process. A large amount of acetaldehyde in PET used for bottle manufacturing can give the
beverage inside an odd taste.

Once the plastic itself has been manufactured, the bottle manufacturing process can begin. To
ensure that the PET is appropriate for use, numerous tests are done post-manufacturing to
check that the bottles are impermeable by carbon dioxide which is important for bottles that
carry soda). Other factors, such as transparency, gloss, shatter resistance, thickness and
pressure resistance, are also carefully monitored.

Bottle Manufacturing

The first stage in bottle manufacturing is stretch blow molding. The PET is heated and placed in
a mold, where it assumes the shape of a long, thin tube. (The process by which the plastic is
forced into the mold is called injection molding.The tube of PET, now called a parison, is then
transferred into a second, bottle-shaped mold. A thin steel rod, called a mandrel, is slid inside
the parison where it fills the parison with highly pressurized air, and stretch blow molding
begins: as a result of the pressurized air, heat and pressure , the parison is blown and stretched
into the mold, assuming a bottle shape. To ensure that the bottom of the bottle retains a
consistently flat shape, a separate component of plastic is simultaneously joined to the bottle
during blow molding.
The mold must be cooled relatively quickly, so that that the newly formed component is set
properly. There are several cooling methods, both direct and indirect, that can effectively cool
the mold and the plastic. Water can be coursed through pipes surrounding the mold, which
indirectly cools the mold and plastic. Direct methods include using pressurized air or carbon
dioxide directly on the mold and plastic.

Once the bottle (or, in continuous manufacturing, bottles) has cooled and set, it is ready to be
removed from the mold. If a continuous molding process has been used, the bottles will need
to be separated by trimming the plastic in between them. If a non-continuous process has been
used, sometimes excess plastic can seep through the mold during manufacturing and will
require trimming. After removing the bottle from the mold and removing excess plastic, the
bottles are ready for transportation.

Estimated Business Plan

7. FIXED COST

7A. LAND

47000
i. Cost of land (rented)
60,000
ii. Land development
10,000
iii. Registration and other fees/BDT

7B. BUILDING AND OTHER CONSTRUCTION

i. Building (2000 sq. feet) 200000

ii. Other immovable property 60000`

7C. PLANT & MACHINERY INCLUDING LABORATORY

89,850,000
i. Imported and local (Annexure- I)
3,75,000
ii. Erection & commission of the plant
(Civil, Electrical, mechanical 7.5% of fixed machinery cost)

7D. UTILITY SYSTEM & OTHERS SERVICE EQUIPMENT

 i. Power supply installation/connection cost & security 50,000
money
ii. Water supply installation/connection cost & security 50,000
money
Nil
iii. Gas line installation/safety equipment
1,00,000
iv. Furniture, fixture & office
Nil
v. Effluent disposal system
10,000
vi. Others (telephone etc.)

7E. TECHNICAL KNOW-HOW CONSULTANCY & OTHERS

2,00,000
i. Technical (process) know-how
50,000
ii. Technical assistance fee
Nil
iii. Other preliminary & pre-operational expenses

Total Fixed Cost (Tk) 91,062,000

8. RUNNING COST/YEAR

8A. RAW MATERIALS

7,492,050
i. Imported(including stock)
ii. Local (including stock delivery at site including)
(Annexure- II)

8B. MANPOWER

2,40,000
i. Salaries wages for technical/skilled man power
3,00,000
ii. Salaries for managerial/supervisor
4,32,000
iii. Salaries for administration/marketing
24,48,000
iv. Wages for unskilled labor
(Annexure- III)

8C. UTILITY/YEAR (with supporting estimates)

 20,000
i. Cost of water consumption
20,000
ii. Cost of gas consumption
4,80,000
iii. Cost of electricity
1,00,000
iv. Cost of fuel/lub oil etc.

8D. DEPRECIATION & OTHER INDIRECT EXPENDITURE /YEAR

Nil
i. Depreciation on building and other fixed assets
ii. Depreciation on plant and machineries considering 5,00,000
salvage
48,000
iii. Repair and maintenance cost
57,450
iv. Insurance and taxes, 1% of fixed cost
20,000
v. Contingency and other unforeseen
6,00,000
vi. Marketing and distribution, advertisement etc
3,60,000
vii. Rent of hired houses @ Tk 30000 per month

Total Running cost (Tk) 13,117,500

Total Expenses per year (Tk) 104,179,500

10. REVENUE FROM SALES/YEAR

Tk. 3000 per Kg solder wire 300,000,000

11. GROSS PROFIT/YEAR 93,759,007

12. NET PROFIT AFTER VAT/YEAR (15% VAT) 79,759,007

 PROFITABILITY ANALYSIS
13. Return on investment

Net Profit
×100%
Total Investment

79,759,007
= ×100% = 76.55%
104,179,500

14. P/V Ratio

Contribution 93,759,007
×100% = ×100% = 31.25%
Sales 300,000,000

15. Breakeven Point (Kg)

Total Fixed Cost

Breakeven Point =
Unit Sale Price−Variable cost per unit

91,062,000
= = 107893.4Kg
3,000−2,156

16. PAY BACK PERIOD

Total investment 104,189,500

= = 1.30 years
Net Profit 79,595,007

ANNEXURE –I
LIST OF MACHINERIES WITH COST

Sl No. Name & Specification Quantity/ Unit price in TK. Total Price in TK.
of Machineries/Plant Unit
 1 Stretch blow moulding 3 400,000/= 1,200,000/=
machine

2 Injection moulding 3 1,500,000/= 4,500,000/=

machine

3 Water purifying 2 2,000,000/= 4,000,000/=

machine

4 Extrusion machine 2 40,000,000/= 80,000,000/=

5 lifting machine 3 50,000/= 150,000/=

Total 89,850,000/=

ANNEXURE –II

LIST OF RAW MATERIALS WITH COST

Sl No. Name of chemicals/Goods Unit Price Amount Total Price in TK.

(Per Kg)

1 Polyvinyl chloride Tk. 70 95,550 Kg 6,688,500

2 Polyethylene Tk. 75 9,450 Kg 708,750

Terephthalate
3 Polyethylene Tk. 60 1,580 Kg 94,800

Total 1,06,580 Kg 7,492,050

TABLE FOR MANPOWER

Sl Designation No. of post Salary per month (Tk) Total Salary Annual
no per month Salary
(Tk)
(Tk)

1 Manager 01 25,000 25,000 3,00,000

2 Marketing 02 18,000 36,000 4,32,000

Officer/Accou
nts Officer

3. Skilled Labor 01 20,000 20,000 2,40,000

4. Unskilled 17 12,000 2,04,000 24,48,000

Labor

Total 2,85,000 34,20,000