Manufacturing Plastic Crates, Fiber Glass Containers & PET Preforms

PLASTIC CRATES, FIBER GLASS
CONTAINER & PLASTIC PET

PREFORM MANUFACTURING
PROJECT
TIBEBEU TEFERA DESSIE
FIBER GLASS CONTAINER & PLASTIC PET PREFORM AND CRATES MANUFACTURING PROJECT 2017
CONTENTS
1. EXECUTIVE SUMMARY...........................................................................................................................................7
2. INTRODUCTION......................................................................................................................................................9
2.1 PRODUCT DESCRIPTION AND RATIONALE FOR INVESTMENT.......................................................................9
2.2.1 PRODUCT DESCRIPTION.......................................................................................................................9
2.2.2 RATIONALE FOR THE PROJECT............................................................................................................12
3. THE COMPANY......................................................................................................................................................13
3.1 THE PROMOTER: TIBEBU TEFERA DESSIE....................................................................................................13
3.2 BUSINESSES OBJECTIVES.............................................................................................................................14
3.3 GENERAL MANAGER: TIBEBU TEFERA DESSIE.............................................................................................14
4. PLASTIC CRATES MARKET STUDY.........................................................................................................................15
4.1. GENERAL OVERVIEW...................................................................................................................................15
4.2. DEMAND CONSIDERATION..........................................................................................................................16
4.2.1. PLASTIC CRATES DEMAND FROM THE BEER MARKET............................................................................16
4.2.2. EXISTING BEER PRODUCTION.................................................................................................................16
4.2.3. EXPANSION & NEW ENTRANT TO BEER INDUSTRY.................................................................................18
4.2.4. PROSPECT OF BEER DEMAND.................................................................................................................19
4.2.5. TOTAL BEER PLASTIC CRATES GLASS DEMAND.......................................................................................23
4.3. PLASTIC CRATES DEMAND FROM SOFT DRINKS MARKET...........................................................................25
4.3.1. EXISTING AND EXPANSION SOFT DRINK PROJECTS................................................................................25
4.3.2. TOTAL SOFT DRINK AND PLASTIC CRATES DEMAND...............................................................................31
4.4. PLASTIC CRATES DEMAND FROM WINE MARKET.......................................................................................32
4.5. SUMMARY OF PLASTIC CRATES DEMAND...................................................................................................34
4.6. SUPPLY CONSIDERATION.............................................................................................................................34
4.6.1. DOMESTIC PLASTIC CRATES PRODUCTION.............................................................................................34
5. FIBER CONTAINER AND PET PREFORM MARKET STUDY......................................................................................36
5.1. FACTORS AFECTING THE MARKET FOR FIBER CONTAINER AND PET PERFORM.........................................36
5.1.1. ECONOMIC GROWTH..............................................................................................................................36
5.1.2. SOURCE: IMF, 2013.................................................................................................................................37
5.1.3. POPULATION GROWTH...........................................................................................................................37
5.1.4. URBANIZATION........................................................................................................................................38
5.1.5. DOMESTIC POPULATION GROWTH AND DEMOGRAPHY........................................................................39
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5.1.6. IMPURE AND IMPROPER MUNICIPAL WATER SUPPLIERS.......................................................................40

5.1.7. EDUCATION AND HEALTH CONSCIOUSNESS...........................................................................................40
5.2. DERIVED DEMAND FOR PLASTIC PET-PERFORM AND CAPS........................................................................40
5.2.1. BOTTLED WATER.................................................................................................................................40
5.2.1.1. DOMESTIC DEMAND FOR BOTTLED WATER.......................................................................................40
5.2.1.2. DOMSTIC SUPPLY FOR BOTTLD WATER..............................................................................................42
5.2.1.3. DOMESTIC MARKET DEMAND AND SUPPLY GAP...............................................................................46
5.2.2. EDIABLE OIL........................................................................................................................................46
A. DOMESTIC EDIBLE OIL PRODUCTION.................................................................................................46
B. IMPORT OF EDIBLE OIL.......................................................................................................................48
C. TOTAL SUPPLY AND SUPPLY PROJECTIONS.........................................................................................49
D. LOCAL EDIBLE OIL SUPPLY PROJECTION.............................................................................................50
5.2.3. CSD (CARBONATE SOFT DRINK)..........................................................................................................50
A. CSD LOCAL PRODUCTION...................................................................................................................50
B. CSD IMPORT.......................................................................................................................................56
C. CSD SUPPLY AND DEMAND GAP.........................................................................................................56
A. JUICE LOCAL PRODUCTION.................................................................................................................57
B. JUICE IMPORT.....................................................................................................................................58
C. JUICE SUPPLY AND DEMAND GAP......................................................................................................59
5.3. LOCAL PRODUCTION OF FIBER CONTAINER PET-PREFORM BOTTLES AND CAPS.......................................60

3.3.1 SUPPLY OF FIBER CONTAINER.............................................................................................................60
3.3.2 SUPPLY OF PET-PREFORM BOTTLES AND CAPS..................................................................................61
5.1. PRICE ANALYSIS...........................................................................................................................................66

5.2. MARKETING STRATEGY................................................................................................................................66
5. THE PROJECT........................................................................................................................................................67
6.1. THE PROJECT SITE........................................................................................................................................67
6.2. LAND, BUILDING AND CIVIL WORKS............................................................................................................67
6.3. PROJECT MACHINERY AND EQUIPMENT REQUIREMENT...........................................................................69
5.1 PROJECT VEHICLES.......................................................................................................................................72
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5.2 OFFICE FURNITURE AND EQUIPMENT........................................................................................................72

5.3 UTILITIES......................................................................................................................................................73
5.4 PROJECT IMPLEMENTATION SCHEDULE......................................................................................................73
6. PRODUCTION PROCESS........................................................................................................................................75
6.1 PRODUCTION PROGRAM............................................................................................................................75
6.2 CAPACITY UTILIZATION................................................................................................................................76
6.3 RAW MATERIAL FOR FIBER CONTAINER......................................................................................................76
6.4 PET PREFORM RAW MATERIAL & CONSUMABLE........................................................................................76
6.5 PET RAW MATERIAL.....................................................................................................................................77
6.6 RAW MATERIAL PLASTIC CRATES.................................................................................................................77
6.7 PRODUCTION PROCESS FOR FIBER CONTAINERS........................................................................................77
6.8 PRODUCTION PROCESS FOR PET BOTTLE....................................................................................................78
6.9 PRODUCTION PROCESS FOR PLASTIC CRATES.............................................................................................78
7. ORGANIZATIONAL & MANAGMENT.....................................................................................................................80
7.1. ORGANIZATIONAL STRUCTURE...................................................................................................................80
7.2. MANAGEMENT............................................................................................................................................81
7.3. AVAILABILITY OF MANPOWER.....................................................................................................................82
7.4. EMPLOYEE BENEFITS...................................................................................................................................84
7.5. RECRUITING AND TRAINING PLAN..............................................................................................................84
8. FINANCIAL ANLYSIS..............................................................................................................................................85
8.1 INVESTMENT COSTS....................................................................................................................................85
8.2 SOURCES OF FINANCE.................................................................................................................................85
8.3 FEASIBILITY ANALYSIS..................................................................................................................................86
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List of Tables
TABLE 21: TOTAL BEER BOTTLE DEMAND PROJECTION................................................................................................22
TABLE 22: PROFILES OF MAJOR ETHIOPIAN SOFT DRINKS INDUSTRY PLAYERS...........................................................26
TABLE 23: PROJECTED TOTAL SOFT DRINKS AND PLASTIC CRATES DEMAND...............................................................31
TABLE 24: WINE BOTTLE DEMAND PROJECTION..........................................................................................................32
TABLE 25: TOTAL PLASTIC CRATES DEMAND.................................................................................................................33
TABLE 26: LOCAL PLASTIC CRATES PRODUCTION.........................................................................................................34
TABLE 1: GDP AT CONSTANT PRICE...............................................................................................................................36
TABLE 2: ETHIOPIA: POPULATION PROJECTION, 1995-2030.........................................................................................38
TABLE 3: PROJECTED ANNUAL DEMAND (HECTOLITERS)....................................................................................40
TABLE 4: DEMAND PROJECTION...................................................................................................................................41
TABLE 5: LIST OF BOTTLE WATER IN ETHIOPIA.....................................................................................................42
TABLE 6: PROJECTED WATER PRODUCTION IN HECTOLITER...................................................................................44
TABLE 7: DEMAND AND SUPPLY GAP......................................................................................................................45
TABLE 8: EDIBLE OIL PROCESSING PLANTS...................................................................................................................46
TABLE 9: IMPORT OF EDIBLE OIL...................................................................................................................................48
TABLE 10: PROJECTED LOCAL SUPPLY OF EDIBLE OIL...................................................................................................49
TABLE 11: PROFILES OF MAJOR ETHIOPIAN SOFT DRINKS INDUSTRY PLAYERS...........................................................51
TABLE 12: IMORT OF CSD FROM 2009 TO 2015............................................................................................................55
TABLE 13: CSD DEMAND SUPPLY GAP...........................................................................................................................56
TABLE 14: JUICE PRODUCTION......................................................................................................................................56
TABLE 15: ETHIOPIAN JUICE & CONCENTRATE IMPORT...............................................................................................57
TABLE 16: PROJECTED TOTAL JUICE SUPPLY..................................................................................................................58
TABLE 17: JUICE DEMAND SUPPLY GAP........................................................................................................................58
TABLE 18: SUPPLIERS OF PET BOTTLE...........................................................................................................................60
TABLE 19: GLASS BOTTLE IMPORT FOR THE YEARS 2009-2015....................................................................................61
TABLE 20: TOTAL SUPPLY OF PET- PREFORMS BOTTLES. (IN KG)..................................................................................63
TABLE 27: COST OF BUILDING AND CONSTRUCTION....................................................................................................67
TABLE 28: COST OF MACHIENRY & EQUIPMENT..........................................................................................................69
TABLE 29: PROJECT VEHICLES.......................................................................................................................................70
TABLE 30: UTILITY CONSUMPTIONS..............................................................................................................................71
TABLE 31: PROJECT FACT SHEETS..................................................................................................................................73
TABLE 32: CAPACITY RATE & PRODUCTION PRGRAM OF THE PROJECTS PER ANNUM................................................74
TABLE 33: RAW MATERIAL REQUIREMENT OF THE COMPANY.....................................................................................74
TABLE 34: MAJOR RAW MATERIALS FOR PLASTIC CRATES............................................................................................75
TABLE 35: STAFFING......................................................................................................................................................80
TABLE 36: TOTAL INITIAL INVESTMENT.........................................................................................................................83
TABLE 37: SOURCE OF FINANCE (DEBT: EQUITY RATIO)................................................................................................83
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List of Figures
FIGURE 5-1: ETHIOPIA BEER PRODUCTION (HL)...........................................................................................................16
Figure5-2: EXISTING BEER PRODUCTION SHARE (%)....................................................................................................17
Figure5-3: EXPANSION AND NEW ENTRANT TO BEER INDUSTRY.................................................................................17
FIGURE 5-4: POPULATION PROJECTION........................................................................................................................18
FIGURE 5-5: GROWING YOUNG POSSIBLE ALCOHOL CONSUMER POPULATION.........................................................18
FIGURE 5-6: PERCENTAGE OF ALCOHOL CONSUMERS.................................................................................................19
FIGURE5-7: TOTAL ALCOHOL CONSUMERS...................................................................................................................19
FIGURE5-8: GDP PER CAPITA PPP USD/ANNUM...........................................................................................................20
FIGURE5-9: INCOME GROUP QUANTILES.....................................................................................................................21
FIGURE5-10: TOTAL APPARENT BEER CONSUMERS......................................................................................................21
FIGURE5-11: BEER BOTTLE DEMAND SUMMARY 000’ PCS..........................................................................................23
FIGURE5-12 : BEVERAGE PRODUCTION IN ETHIOPIA, 2011.........................................................................................25
FIGURE5-13: SOFT DRINK PRODUCTION.......................................................................................................................25
Figure5-14: WINE PRODUCTION IN ETHIOPIA..............................................................................................................31
FIGURE 4-1: POPULATION PROJECTION (IN MILLIONS)................................................................................................36
FIGURE 4-2: URBAN POPULATION (2015).....................................................................................................................37
FIGURE 4-3: POPULATION IN MAJOR CITIES (2015).....................................................................................................37
FIGURE 4-4: BEVERAGE PRODUCTION IN ETHIOPIA, 2014...........................................................................................43
FIGURE 4-5: TRENDS FOR LOCAL WATER PRODUCTION........................................................................................44
FIGURE 4-6: DOMESTIC PRODUCTION OF EDIBLE OIL..................................................................................................47
FIGURE 4-7: TOTAL SUPPLY OF EDIBLE OIL (IN LITERS).................................................................................................48
FIGURE 4-8 : BEVERAGE PRODUCTION IN ETHIOPIA, 2014..........................................................................................50
FIGURE 4-9: SOFT DRINK PRODUCTION........................................................................................................................51
FIGURE 4-10: FIBER CONTAINERS IMPORT DATA..........................................................................................................59
FIGURE 4-11: IMPORTED QUANITYT AND CIF VALUE GROWTH RATE TRENDS 2008– 2013........................................63
FIGURE 6-1: Factory layout (12,000 M2).......................................................................................................................65
FIGURE 6-2: INJECTION MOULDING MACHINES...........................................................................................................68
FIGURE 0-1: PET PREFORM PRODUCTION PROCESS.....................................................................................................76
FIGURE 8-1: ORGANIZATIONAL STRUCTURE OF THE COMPANY..................................................................................79
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1 1. EXECUTIVE SUMMARY
This is a feasibility study prepared to examine the viability of fiber glass container, plastic
preform and plastic crates manufacturing plant that will be established in Amhara Regional
state, North shoe Zone Deber Brehane about 120 km from Addis Ababa along the main
road from Addis Ababa to Mekelle.
The project towns is blessed with all infrastructures that are necessary for the project as
well as for work force. The project town has schools, market places, recreation center,
electricity, tap water as well as all the necessary public service. Due to these facts the
Existing location provides a competitive advantage compared to competitors.
The rationale behind the envisage project to establishing fiberglass container, pet bottles
and plastic crates manufacturing project is the existence of a huge demand for fiber
container, Plastic pet and plastic creates from the brewery industry, soft drink industry,
wine industry, milk and dairy products, fisheries, fruits and vegetable and defense sector
etc.…..These sector are growing very fast following the growing middle income in the
country.
The promotor, realizing that the lucrative market opportunities of fiberglass container, pet
preform and plastic crates both within and in the neighboring countries.
In addition to import substitutions, the promoter has a plan to export its products to our
neighboring countries like Port Djibouti, South Sudan, Somali, Kenya and Sudan.
This project is designed to produce fiberglass container, pet bottles and plastic crates for
local market following the huge demand the products in the market. The project will be set
up in Amhara Regional State, Deber Brehane town at 12,000 M2 land.
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The General Manager of this project is dynamic young result- focused entrepreneur, with
strong leadership and communication skills, a reputation for instilling, and leading teams to
achieve shared goals. Strong believer in globalization and sustainable development. The
promoter has MSc degree in project planning and management.
The project has planned to recruits 219 permanent and temporary workers including
management & supervision personnel skilled & unskilled workers when fully operational.
The total investment required for the project is estimated to be approximately birr 106.2
million. The cost covers initial investment costs, working capital requirements and pre-
operating expenses. Out of the total estimated initial costs, birr million will be for civil and
construction works, approximately birr 44.3 million for machinery and equipment, birr 3.1
million will be for motor vehicles , birr 23 million will be working capital. The rest of the
investment cost is allocated for office equipment and furniture, pre-production expenditure
and pre-production interest.
The sources of finance for the total investment will be equity capital and long-term loan
obtained from Bank loan. The company will capitalize its owners a total of Birr 14.73
million (25%) and the remaining balance for the envisage project Birr 44.19 million or 75
percent of total investment will be obtained from loan.
The projection for the income statement is primarily derived from market based sales
estimates which is based on an adequate market assessment and guaranteed sales from
previous experiences. The company is expected to generate a net profit of Birr 155 million
in the first year of operation and that will increase to Birr 472 million at the end of the fifth
year.
The IRR (Internal Rate of Return) of the project for total investment is found to be 60%
with the above economic rate of return, the project is found economically viable and
attractive for investment.
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2 2. INTRODUCTION
2.1 PRODUCT DESCRIPTION AND RATIONALE FOR INVESTMENT

2.2.1 PRODUCT DESCRIPTION
A. PLASTIC CRATES
Plastic crates are used for storage, transportation and distribution and handling of products.
Previously wooden crates were used which are now being substituted by HDPE and PP crates. The
crates are manufactured by injection Moulding process.
The plastic crates have the following advantages:
 Considerable reduction in weight and hence easy handling and transportation.
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 Convince and ease of handling
 Hygienic and non-toxic
 Space saving-stackable and nest able
 Resistant to chemicals and soaps
 Anti-rusting
 Wide choice shape, size and colour tailored for each end use
 With stands wide range of temperature (-35 to 75%) and climatic conditions
encountered during services
 Environmentally friendly
 East to recycle
 Longer service life as compared to wooden crates.
The major product will be 24 x 330 ml Beer Crate with the following specifications;
 Length - 494 mm (external) 466 mm (internal)

 Width - 328 mm (external) 302 mm (internal)
 Height - 268 mm (external) 259 mm (internal)
 Weight - 2380 grams
 Material - HDPE
 Application - 24 x 330 ml glass bottles
 Pocket Size - 74 mm
B. FIBER GLASS CONTAINER
Fiber glass container is a container for storing water. Water tanks are used to provide
storage of water for use in many applications, drinking water, irrigation agriculture, fire
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suppression, agricultural farming, both for plants and livestock, chemical manufacturing,
food preparation as well as many other uses. Fiber glass container parameters include the
general design of the tank, and choice of construction materials, linings. Various materials
are used for making a water tank: plastics (polyethylene, polypropylene), fiberglass,
concrete, and stone, steel (welded or bolted, carbon, or stainless). Earthen pots also
function as water storages. Water tanks are an efficient way to help developing countries to
store clean water.
C. PET BOTTLE
PET Bottles are used to packing of Edible oils, jams and sauces, Butter, syrups, drinking
water etc having the capacity from 500ml to 2 liters. PET resin is extruded and converted to
pre-forms and later molding is done to make the PET Bottles by using the pre-forms.
Major application areas of PET bottles are carbonated soft drinks, Mineral water packing,
Syrups, Edible oil packing, Butter and Mayonnaise, Wine, Liquor and spirit packing, Sauce,
jam and squashes packaging, Agro chemical packaging and house hold containers.
Pet bottles are replacing glass bottles because of the high rate of breakage and the
inconvenience of returning the empty bottle after consumption. As PET bottles provide
better packaging, and have a lower cost than the bottles made from glass and other
materials, different businesses in beverage, food and non-food industry are shifting towards
PET bottles.
The PET resin has superior properties, which are as follows:
o Attractive: Products look good, pure and healthy because of attractiveness of

PET bottles.
o Pure: Products taste good as PET complies with international food contact
regulations.
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o Safe: PET bottles are tough and virtually unbreakable. If they do fail, they
split, not shatter. Their high impact and tensile strength makes them ideal for
carbonated products.
o Good barrier: The low permeability of PET to oxygen, carbon dioxide and
water means that it protects and maintains the integrity of products giving a
good shelf life. PET also has good chemical resistance.
o Lightweight: One tenth the weight of an equivalent glass pack, PET bottles
reduce shipping costs, and because the material in the wall is thinner, shelf
utilization.
2.2.2 RATIONALE FOR THE PROJECT
The rationale behind the envisage project to establishing fiberglass container, pet bottles
and plastic crates manufacturing project is the existence of a huge demand for fiber
container, Plastic pet and plastic creates from the brewery industry, soft drink industry,
wine industry, milk and dairy products, fisheries, fruits and vegetable and defense sector
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etc.…..These sector are growing very fast following the growing

3 middle income in the country.
The promotor, realizing that the lucrative market opportunities of fiberglass container, pet
preform and plastic crates both within and in the neighboring countries.
In addition to import substitutions, the promoter has a plan to export its products to our
neighboring countries like Port Djibouti, South Sudan, Somali, Kenya and Sudan.
This project is designed to produce fiberglass container, pet bottles and plastic crates for
local market following the huge demand the products in the market. The project will be set
up in Amhara Regional State, Deber Brehane town at 12,000 M2 land.
3. THE COMPANY
3.1 THE PROMOTER: TIBEBU TEFERA DESSIE

The promoter of the project Mr. Tibebu Tefera is an entrepreneur and has a successful and
versatile experience in the business for decade. The promoter is keen to take part on the
development activity of the country by involving in the manufacturing plastic and fiber
product for the growing demand of the country & export market in the particular.
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The country rising demand of the plastic and fiber container products and the high
dependency of the sector on imported goods in the country forced Mr. Tibebu Tefera to
participate in the fiber container and plastic pet and crates business in Ethiopia.
The company will fabricate quality denim jeans using modern production techniques
through creation of employment and generating & saving the foreign currency reserve of
the country. The company is under process to acquire 12,000 M2 land in Debre Berhan City
of North Showa zone of Amhara Regional State.
The factory will be managed by a qualified engineers specialized in all aspects of

manufacturing work. The members of the company with their subordinates will have
considerable relevant work experience of many years particularly.
3.2 BUSINESSES OBJECTIVES

The overall objective of this project is to meet the upward demand for fiber containers,
plastic pet and crates and allied products in the world and Ethiopia. Generally the project
targets fiber containers, plastic pet and crates line of production and offer potential
customers with affordable quality products.
With this objective the company has an extensive program of environmental and social
initiatives, which are improving the community and the environment. In addition, the
company would like to become the leading fiber containers, plastic pet and crates
manufacture in Ethiopia. The major business objectives of the company are:
3.3 GENERAL MANAGER: TIBEBU TEFERA DESSIE
The General Manager of this project is dynamic young result- focused entrepreneur, with
strong leadership and communication skills, a reputation for instilling, and leading teams to
achieve shared goals. Strong believer in globalization and sustainable development.
The general manager has the following skills:
 Financial management and analytical, fact based decision making
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 Strategic thinking and long term visioning

4  Creative development-ability to lead and develop
successful business
 Excellent planning and time management skill until the ability to balance multiple
project under tight time line and function effectively in a fast-paced environment
4. PLASTIC CRATES MARKET STUDY

4.1. GENERAL OVERVIEW
The international trend has switched towards the use of plastic crates and they are already
in use for storage and shipping in a wide range of industries such as: agriculture,
automotive, building and construction, clothing, electronics, food, fruit and vegetables,
groceries in supermarket chains, bakeries, dairy, fisheries, freight forwarding, household
goods, nurseries, pharmaceuticals, packaging, logistics, rubbers and white goods.
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Today, all companies, up and down the supply chain, are demanding lower costs from each
of their suppliers as competition increases. Returnable and reusable transport packaging
offers not only reduced costs, but also increased efficiencies over most forms of one-way
packaging.
Plastics crates are used in a wide range of applications. Some items, such as food packaging
and beverage, become waste only a short time after purchase. The greatest advantage of
plastic crates is that they lend themselves to be reused many times over.
Over the past two decades, due to the expansion and privatization of existing brewery
industry, soft drink industry, wine industry, milk and dairy products, fisheries, fruits and
vegetable and defense sector etc., following this the demand for plastic crates glass has
been increasing sharply.
4.2. DEMAND CONSIDERATION

The demand for plastic crates is highly related with the economic growth of economy. Since
the consumption of the product is associated mainly with the various industries in the
economy, the demand for the product is influenced by developments in the industries.
There are various industries in the country which consume plastic crates based products.
Due to multiple uses of plastic crates products, its demand is rapidly growing.
The market study tries to assess the demand for the plastic crates is based on end users
approach. Accordingly, the following section will assess the demand for plastic crates which
is mainly emanates from the local production of brewery industry, soft drink industry, wine
industry, milk and dairy products, fisheries, fruits and vegetable and defense sector etc.,,.
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Therefore, this feasibility study breaks down the beer market into indicated consumer
products in order to see the market in a structured manner.
4.2.1. PLASTIC CRATES DEMAND FROM THE BEER MARKET
4.2.2. EXISTING BEER PRODUCTION
One of the driving factors for plastic crates market is a beer industry. In line with regional
trends, Ethiopia’s beer industry has seen much activity in recent years including a surge in
demand associated with increased urbanization, population growth, and rising incomes.
From a level of just 2.5 million hectoliters in 2008/09, beer production has risen to nearly
10.4 million hectoliters by 2014/15, giving an estimated average growth of around 27
percent per year. The industry at present includes seven major, namely Meta Abo, Heineken,
BGI Ethiopia, Dashen and Raya.
FIGURE 1: ETHIOPIA BEER PRODUCTION (HL)
SOURCE: CENTRAL STATISTICS AUTHORITY & OWN COMPUTATION
Based on the actual production data collected from each beer producers, by far the largest
producer of beer in the market is BGI Ethiopia. Its current production level is around 3.1
million hectoliters per annum (34% production share) from its three large plants in Addis
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Ababa, Hawassa and Kombolcha with capacity of 1.56, 0.9 and 0.72 million hectoliters
respectively.
Object 3 Heineken comes in second with current

production capacity of 3 million hectoliters per annum (32% production share) from its
kality, Harar & Bedlle plants. Meta Brewery comes in third with current production
capacity of 1.5 million hectoliters per annum (16% production share).
FIGURE 2: EXISTING BEER PRODUCTION SHARE (%)
Total Theoretical
Companies
Capacity (HL)
Existing Companies
BGI (Addis Ababa, Hawassa 3,180,000
& Kombolca Plants)
Harrar 900,000
Bedle 600,000
Heneken 1,500,000
Raya 710,000
Meta 1,500,000
Dashen 769,000
Habesha 350,000
Dashen Expansion 219,000
Existing Total 9,728,000
SOURCE: MARKET SURVEY
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4.2.3. EXPANSION & NEW ENTRANT TO BEER INDUSTRY
Diageo after investing on META ABO beer project is planning to expand Meta Abo brewery
production capacity to 3.5 million hectoliters within the next five years by expanding the
existing 1.5 million hectoliters additionally by 2 million hectoliters. When it comes to new
entrants Zebedar beer is a green field beer factory under formation by Zebedar Hulegb
Industries, on operation the factory will have the capacity to produce 300,000 hectoliters of
beer.
Table 1: EXPANSION AND NEW ENTRANT TO BEER INDUSTRY
Total Theoretical Expected year of

Companies
Capacity (HL) commissioning
Pipeline Companies
Meta - Expansion 2,000,000 2018
Zebider 300,000 2017
Pipeline Total 2,300,000
SOURCE: NOBLE TEAM DATA COLLECTION
4.2.4. PROSPECT OF BEER DEMAND
One of the main drives that directly influence the beer demand in Ethiopia are the growth
of population along with a change in disposable income of that growing population.
Accordingly the 2007 Population and Housing Census results show that the population of
Ethiopia grew at an average annual rate of 2.6 percent. Accordingly, the total population of
Ethiopia is projected to reach 94 million within the next four years from 87.9 million in
2014. The following figure shows the population projection for the next five years with
2.6% per annum.
FIGURE 3: POPULATION PROJECTION
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Object 5
SOURCE: CSA
Taking into account the legal alcohol consumption minimum age (20 Years old) and
conservatively estimating the maximum age as 49 years old, the total possible beer
consumer population will reach 31.5 million in 2017.
FIGURE 4: GROWING YOUNG POSSIBLE ALCOHOL CONSUMER POPULATION
Object 7
SOURCE: CSA & OWN COMPUTATION
Not all population at the beer consumption age consumes beer. According to CSA
demographic & health Survey (DHS), from the possible alcohol consumer male population
75% of them consume alcohol and from the possible female alcohol consumer population
51% of them actually consumes alcohol.
FIGURE 5: PERCENTAGE OF ALCOHOL CONSUMERS
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Object 9
SOURCE: CSA DHS SURVEY
Based on the above alcohol consumer percentages, the actual beer consumer population
projected to reach 20 million in 2017.
FIGURE 6: TOTAL ALCOHOL CONSUMERS
Object 11
SOURCE: CSA & OWN COMPUTATION
Ethiopia has one of the fastest growing economy in the world with an average GDP per
capita PPP growth rate of 9% which has resulted in a growing emerging middle class who
have disposable income to buy beer.
FIGURE 7: GDP PER CAPITA PPP USD/ANNUM
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Object 13
SOURCE: WORLD BANK
According to 2011/12 Household Income Consumption and Expenditure (HICE) Survey

50% of the urban and 20% of the rural population fall under the richest quintile income
group while 22% estimated to be second richest. Of the total population only the richest
income group regarded as potential niche market to be customer of beer.
FIGURE4-8: INCOME GROUP QUANTILES
Object 15
SOURCE: CSA HOUSEHOLD INCOME CONSUMPTION AND EXPENDITURE (HICE) SURVEY
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Following the economic & population growth and urbanization rate the apparent beer
consumers’ population is expected to reach 6.2 million in 2017.
FIGURE 9: TOTAL APPARENT BEER CONSUMERS
Object 17
SOURCE: OWN COMPUTATION
4.2.5. TOTAL BEER PLASTIC CRATES GLASS DEMAND
The total demand for beer plastic crates emanates for the existing beer factories
incremental plastic crates demand and from the new entrant beer factories. Total beer
plastic crates demand are those to commence operation. The incremental plastic crates
demand on the existing beer factories are estimated an average of 30% recycling rate on
the total cyclical production. The following tables is calculated based on the following facts
and assumptions:
 One hector liter is equal to 100 liter
 One beer plastic crates contains 24 bottles
 One beer bottle is equal to 330 ml.
 From total beer production, 80% of the production will be beer and the rest will be
draught and others
Page 33
TABLE 2: TOTAL BEER BOTTLE DEMAND PROJECTION
Capacity Total Beer crates requirement (PCS) @330 ML

Companies
(HL) 2015/16 2016/17 2017/18 2018/19 2019/20 2020/21
liters Beer (80% No of Beer
Existing Companies from total bottled
production @330 ml
318,000,00
BGI 3,180,000 254,400,000 770,909,091 32,121,212 32,121,212 32,121,212 32,121,212 32,121,212 32,121,212
0
Harrar 900,000 90,000,000 72,000,000 218,181,818 9,090,909 9,090,909 9,090,909 9,090,909 9,090,909 9,090,909
Bedle 600,000 60,000,000 48,000,000 145,454,545 6,060,606 6,060,606 6,060,606 6,060,606 6,060,606 6,060,606
150,000,00
Heneken 1,500,000 120,000,000 363,636,364 15,151,515 15,151,515 15,151,515 15,151,515 15,151,515 15,151,515
0
Raya 710,000 71,000,000 56,800,000 172,121,212 7,171,717 7,171,717 7,171,717 7,171,717 7,171,717 7,171,717
150,000,00
Meta 1,500,000 120,000,000 363,636,364 15,151,515 15,151,515 15,151,515 15,151,515 15,151,515 15,151,515
0
Dashen 769,000 76,900,000 61,520,000 186,424,242 7,767,677 7,767,677 7,767,677 7,767,677 7,767,677 7,767,677
Habesha 350,000 35,000,000 28,000,000 84,848,485 3,535,354 3,535,354 3,535,354 3,535,354 3,535,354 3,535,354
Dashen
219,000 21,900,000 17,520,000 53,090,909 2,212,121 2,212,121 2,212,121 2,212,121 2,212,121 2,212,121
Expansion
972,800,00 2,358,303,03
Existing Total 9,728,000 778,240,000 98,262,626 98,262,626 98,262,626 98,262,626 98,262,626 98,262,626
0 0
NEW crates REQ @
29,478,788 29,478,788 29,478,788 29,478,788 29,478,788 29,478,788
30% PCS
Pipeline Companies
Meta - Expansion 2,000,000 200,000,000 160,000,000 484,848,485 20,202,020 20,202,020 20,202,020

20,202,020
Zebider 300,000 30,000,000 24,000,000 72,727,273 3,030,303 3,030,303 3,030,303 3,030,303
3,030,303
230,000,00 23,232,
Pipeline Total 2,300,000 184,000,000 557,575,758 3,030,303 23,232,323 23,232,323 23,232,323
0 323
NEW crates REQ @
30% AFTER 2ND 909,091 6,969,697 6,969,697 6,969,697
YEAR - PCS
Total New beer
3,939,394 30,202,020 30,202,020 30,202,020
crates Req (PCS)
Total beer crates 29,478, 29,478,7 33,418,1 59,680,8 59,680,8 59,680,8
required (pcs) 788 88 82 08 08 08
Currently, one beer factory confirmed to expand their production capacity and additional
one beer factories under formation that are expected to be fully operational in 2017 & 2018
respectively. The existing beer factories consumptions is estimated to be 29.4 million
Page 33
plastic crates in 2017. The total new factories plastic crates consumption in 2017/18 is
estimated 3 million plastic crates with a yearly additional and cyclical plastic crates demand
of 909 thousand in the year 2019/20. The total bottle demand in 2019/20 is estimated to
reach 59.6 million as shown in the following summary graph.
FIGURE4-10: BEER BOTTLE DEMAND SUMMARY 000’ PCS
Object 20
4.3. PLASTIC CRATES DEMAND FROM SOFT DRINKS MARKET

4.3.1. EXISTING AND EXPANSION SOFT DRINK PROJECTS
The Ethiopian Soft Drink Market is dominated by two players; MOHA soft drink industry
(MOHA) and East African Bottling Share Company (East African). These two companies
respectively bottle and distribute their flagship products Pepsi Cola and Coca Cola along
with other sister brands. Between the two companies the Ethiopian soft drink market is
supplied about 40 million annualy 1 .
2
Soft drinks in Ethiopia are marketed most of the time in 300ml glass bottle.Although the
market is dominated by 300ml size bottles, 500ml and 1000ml bottles are also in the
market.
1 Source: Fortune Newspaper, February 22, 2009; Volume 9, Number 460.

2 One Crate equals 24 bottles of 300ml.
Page 33
Admittedly the oligopoly nature of the soft drink market in Ethiopia makes it difficult for a
new entrant to succeed in taking market share away from the established companies.
However, there is evidenced lack of sound management capability and experience as well as
inefficiency in utilizing available resources.
The future of the soft drink market is expected to be positive considering the following
factors:
 Population urbanization and awareness of such products.

 Continuous increase of the real GDP as evidenced by the double digit growth over
the last decade which is creating a new market every year.
 Government initiative to support the expansion of the manufacturing market with
incentives such as tax holidays.
 Ease of reaching the rural population as result of expedient development of the
country’s infrastructures.
Soft drinks are by far the most popular drink produced and consumed in Ethiopia.
According to Central Statistics Agency, soft drinks (lemonade) accounts for about 37% by
volume of beverages produced in the year 2011 with alcohol and wine being the lowest.
FIGURE 11: BEVERAGE PRODUCTION IN ETHIOPIA, 2011
Page 33
Officially the Central Statistics Agency reported in its 2012 national abstract publication
that, for the year 2010/2011 about 3.7 million hectoliters of soft drink products were
produced. As shown in table and figure 3 below, the total production of soft drinks has
shown an increasing trend over the years.
FIGURE 12: SOFT DRINK PRODUCTION
SOURCE: CENTRAL STATISTICS AUTHORITY
Page 33
Currently the production of soft drinks is dominated by three companies, namely East
African Bottling, Moha Soft Drink Industries and Ambo Mineral Water S.C. The following
table 18 presents the profile of major players in Ethiopia soft drink sub-sector.
TABLE 3: PROFILES OF MAJOR ETHIOPIAN SOFT DRINKS INDUSTRY PLAYERS
1. East African Bottling Share Company (EABSC)

Coca-Cola was first bottled in Ethiopia’s capital Addis Ababa in 1959 by the
Ethiopian Bottling Share Company, which later opened a second branch in Dire
Dawa in 1965. The two plants were nationalized in 1975 and ran as public
companies until 1996 when they were bought by Ethiopian entrepreneurs. Just
prior to this, in 1995, Coca-Cola Sabco bought shares in the business and, in 1999,
signed a joint venture agreement with the plants. Having invested around 500
million USD South African Beverage Company (SABCO) Coca-Cola currently holds
around 82pc share in the Ethiopian company, while the remaining 18pc is owned
by two of the original shareholders, Negussie and Munir, as well as Dereje
Company profile
Yesuwork, and Abinet G. Meskel. In 2001 the company changed its name to the
East African Bottling Share Company (EABSC). East Africa Bottling or EABSC has
grown so much ever since the mid-1990s. Between 2001 to 2003 EASBC
performed the expansion work for the Dire Dawa Plant, which replaced the old
production line of the plant, at a capacity of two million cases a year, by a new
modern production line at a capacity of seven million cases. Overall EABSC's
expansion project, that cost 12 million dollars spent on procurement of two plants
and a bottle washing machine, helped it enhance its production capacity from five
million crates in 1995 to 21 million crates in 2010.
EABSC produces soft drinks under the following brands - Coca Cola, Fanta, Coca-
Light, Sprite, and the Schweppes group (i.e., Fanta Orange & Pineapple).In May
Products
2012, EABSC officially added Fanta Strawberry to the already existing brands listed
above.
Annual Sales The Annual Turn-over of the company was reported around USD100 million in
turnover (USD/Birr) 2010/11 The company has employed around 1,000 permanent employees.
Location of
Filling/Bottling EABSC currently operates across 2 plants, one in Addis Ababa and the other in
Plants (in Addis & Dire Dawa town (525 Km from Addis)
Regions)
Current Production 80,000 cases per day from its two plants; although EABSC has most recently
Capacity (per day)& upgraded by more than 2 folds both is plants production capacity by adding new
Market Share production lines
Addis Ababa:
 New line : 42,000 lt/hr
 Old line 1: 26,000lt/hr
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Currently New line is operational
Dire Dawa:
 New line : 36,000lt/hr
 Old line 12,000lt/hr
Currently new line is operational
(i.e., Addis Ababa: 42,000 liters/hour & Dire Dawa: 36,000 liters/hour). At present,
EASBC has a national industry market share of around 45 percent.
Most recently, East African Bottling Share Company (EABSC) announced an eight-
year investment spree of nearly nine billion Birr, intended to make Ethiopia its
number one market in Africa by the year 2020. Already underway is the
construction of a five-storey production building in the company compound in
Addis Ababa at a cost close to 18.6 million dollars or 330 million Br. These
buildings are part of a 52 million-dollar or 923 million-Br expansion, intended for
the Addis Ababa Plant, including the installation of two additional production
lines, bringing the total to five. One of these lines will be dedicated to packaging
Expansion projects
the company’s beverages in plastic bottles. The original expansion of the Dire
& New Investments
Dawa Plant, which saw production grow to seven million cases, cost 20 million
dollars. The new expansion, expected to cost the same amount of money as part
of Plan 2020, will see the installation of one more line in 2012/13. When the Addis
Ababa and Dire Dawa expansions are finalized, the company expects a total
annual production of 45 million cases. The plan includes three new plants in Bahir
Dar, Hawassa, and a third plant to be located in western Ethiopia in a city yet to be
identified.
2. MOHA Soft Drinks Industry Share Company

MOHA soft drinks Industry S.C was established on May 15, 1996 acquiring four
Pepsi plants (Nifas Silk Plant, Tekle Haimanot Plant, Gondar Plant, and Dessie
Plant) from the Ethiopian Privatization Agency with paid capital of Birr
108,654,000 and as part of MIDROC Ethiopia Group Companies.
Company profile In addition to the initial purchase price of the Soft Drinks factory, MOHA has
invested Birr 8 Million for the expansion of new projects, Birr 153 million for
refurbishment and replaglass bottle & tumblers of existing plants and Birr 241
million for marketing, infrastructure, excluding advertisement and sponsorship
expenses.
Products Major products of MOHA Soft Drinks Industry S.C. are: Pepsi Cola, Mirinda
Orange, 7-Up, Mirinda Tonic, Mirinda Apple (all Pepsi Brands), and Kool (Bure
Kool and Tossa bottled water products). MOHA also plans to introduce new
Page 33
products like Pepsi Max and Diet Pepsi brands.
Annual turnover has reached around Birr 556 million and sales stands at an
Annual Sales
average annual growth rate of 12%, providing 2,485 jobs for citizens out of which
turnover (USD/Birr)
1,095 are new employment opportunities since acquisition.
MOHA currently has 7 operating units including three found in Addis Ababa
including the Nefas Silk Pepsi Plant, Teklehaimanot Pespsi Plant, and one
franchised Summit Beverage Plant; as well as across regions including three in
Location of
the Amhara Regional State (410 km Bure Pespsi & Kool Water Plant, 650 Km
Filling/Bottling
Gondar Pepsi Plant, and the 385 km Dessie Pespsi & Tosa Ambo Water Plant),
Plants (in Addis &
and the recently inaugurated Hawassa Plant (270 Km) in the Southern Nations &
Regions)
Nationalities People's Regional State (SNNPR).
Moreover, MOHA is marketing 20pc of its products in plastic bottles of in half,
one, 1.5 and 2.25-litre sizes.
Current Production 99,000 cases per day from all its operational plants across the country. Currently
Capacity (per day)& MOHA commands a 52 percent share of the market in soft drinks industry in the
Market Share country
MOHA envisages an average annual increase of 15% in sales volume and a
corresponding profit growth. The company has already set a new PET-line at ITS
Summit Plant: 12,000 bottles per hour with 1.5 liter bottle capacity (both for soft
drinks and bottled water) which went operational as of October 2010 with total
Expansion projects
estimated investment cost of around Birr 130 million Birr. MOHA's upcoming
& New Investments
investment projects include: the Adigrat Pepsi Cola Bottling Plant in Tigray Region
(872 Km) with total estimated investment cost of Birr 208 million & the Dessie
Pepsi – Cola & Carbonated Water Plant (385 Km) in Amhara Region with total
estimated investment cost of around Birr 208 million
3. AMBO MINERAL WATER S.C
Ambo mineral water factory was established 80 years ago in Sekele locality near
a hot spring 130 km west of Addis Ababa. The factory had dominated 85 percent
of the mineral water market. The factory was nationalized in 1974 and it was
partially privatized in 2008. An Ethiopian businessman, Tewodros Ashenafi, in
partnership with South African brewery company, SABMiller bought the factory
Company Profile
from the Ethiopian Privatization Agency two years ago. SABMiller and
SouthWest Development, a company established and managed by Tewodros
forged a joint venture company, Ambo Mineral Water S.C., with the Ethiopian
government. The share company has 3,607,000 shares with a total par value of
300,607,000 birr.
Products Ambo Original
 475 ML returnable glass
 330 ML non-returnable glass
 250 ML PET
Page 33
Ambo Lite
 500 ML PET
 250 ML PET
 1 Lit PET
 2 Lit PET
Flavored Ambo - Orange, Apple, Pineapple and Lemon
 250 ML PET
 500 ML PET
 1 Lit PET
 2 Lit PET
The Ambo mineral water manufacturing plant had two lines which have a total
Current Production production capacity of 14,000 per hour. The two old lines were renovated and
Capacity (per day another new line was installed. The new line alone has a production capacity of
24,000 bottles per hour.
Ambo Mineral Water S.C., the bottler of the popular Ambo mineral water, on
Expansion projects & Thursday announced that it had undertaken a major expansion project on its
New Investments mineral water manufacturing plant near Ambo town at the cost of 21 million
dollars.
SOURCE: SURVEY OF COMPANIES AND INDUSTRY EXPERTS; VARIOUS ARTICLES AND RESOURCES
4.3.2. TOTAL SOFT DRINK AND PLASTIC CRATES DEMAND
The total supply of soft drinks including energy drinks are the sum of local productions.
Projections are made based on the average growth rate of the production for the last seven
years. The demand for new bottle from soft drink industry expected to increase from 270.4
million pcs in 2014 to 440.5 million pcs in 2024.
Page 33
TABLE 4: PROJECTED TOTAL SOFT DRINKS AND PLASTIC CRATES DEMAND
Total 65% of the Number of Number of

Mineral
Soft drink production of total Glass bottles plastic crates
YEAR water
(Hectoliter) soft drink in production req required @330 required for
(Hectoliter)
Liter glass bottle ml 24 pcs bottles
2013/14 6,347,928 4,480,925 1,082,885,300 703,875,445 2,132,955,894 88,873,162
2014/15 7,109,680 5,018,636 1,212,831,600 788,340,540 2,388,910,727 99,537,947
2015/16 7,962,841 5,620,872 1,358,371,300 882,941,345 2,675,579,833 111,482,493
2016/17 8,918,382 6,295,377 1,521,375,900 988,894,335 2,996,649,500 124,860,396
2017/18 9,988,588 7,050,822 1,703,941,000 1,107,561,650 3,356,247,424 139,843,643
2018/19 11,187,218 7,896,921 1,908,413,900 1,240,469,035 3,758,997,076 156,624,878
2019/20 12,529,685 8,844,552 2,137,423,700 1,389,325,405 4,210,076,985 175,419,874
2020/21 14,033,247 9,905,898 2,393,914,500 1,556,044,425 4,715,286,136 196,470,256
2021/22 15,717,236 11,094,606 2,681,184,200 1,742,769,730 5,281,120,394 220,046,683
2022/23 17,603,305 12,425,958 3,002,926,300 1,951,902,095 5,914,854,833 246,452,285
4.4. PLASTIC CRATES DEMAND FROM WINE MARKET

Wine production in Ethiopia has been dominated by Awash winery for the last decades
before BGI Ethiopia entered to the market at the end of 2012 in the name of Castel winery.
The volume of wine and associated liquor produced in the past six years reached 76,010
hectoliters in 2012/13 with an average growth of 9% from 2007/8 to 2012/13.
Figure4-13: WINE PRODUCTION IN ETHIOPIA
Object 23
SOURCE: CSA
Page 33
Awash winery is by far the oldest winery in Ethiopia. The winery has been in existence for
about 70 years now. Currently, Awash Winery has an annual production of about 10 million
bottles, most of which is exclusively consumed by the Ethiopian market.
Castel Winery on its part is a new player in the Ethiopian wine-making industry. The
winery is located in the town of Ziway some 160 km south of Addis Ababa. Castel’s
vineyards were established in 2007 as a partnership between the Ethiopian Government
and the Castel Group, which is today one of the largest wine and beer producer in the
world. Castel Winery has a total annual production of about 1.2 million bottles of Ethiopian
Rift Valley Wine. Plans are to increase production to 3 million bottles per year by 2016.
Taking the mix of wine brands currently produced by these two companies, the attainable
capacity of the two wineries combined is estimated at about 18 million liters by 2022/23,
which is almost 1.8 million glass bottle & tumblers per year.
The total wine bottle demand production is estimated 690,425 plastic crates in 2013/14
and is expected to increase by the 2022/23 years average of 9% per annum and reaches 1.4
million plastic crates as shown in the following graph.
TABLE 5: WINE BOTTLE DEMAND PROJECTION
YEAR WINE (HECTOLITER) WINE REQUIRED

PRODUCTION IN PLASTIC CRATES
LITER
2013/14 82,851 8,285,100 690,425
2014/15 90,307 9,030,700 752,558
2015/16 98,435 9,843,500 820,292
2016/17 107,294 10,729,400 894,117
2017/18 116,951 11,695,100 974,592
2018/19 127,476 12,747,600 1,062,300
2019/20 138,949 13,894,900 1,157,908
2020/21 151,455 15,145,500 1,262,125
2021/22 165,086 16,508,600 1,375,717
2022/23 179,943 17,994,300 1,499,525
SOURCE: CSA & OWN CALCULATION
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4.5. SUMMARY OF PLASTIC CRATES DEMAND

As can be seen from the above analysis and demand projections, demand for plastic crates
are mainly emanates from production of brewery industry, soft drink industry, wine
industry, milk and dairy products, fisheries, fruits and vegetable and defense sector etc..
Therefore, the current demand for plastic crates is a summation of beer industry, soft drink
and wine industry are the main bases and the current demand for plastic crates is
estimated 155.2millions plastic crates in 2016/17 and projected to reach 307.6 million
plastic crates in 2022/23 without considering any major new entrant to the market fruits
and vegetable sectors, and other sectors like fishing, dairy processing and etc…as shown in
the following graph.
TABLE 6: TOTAL PLASTIC CRATES DEMAND
PLASTIC CRATES DEMAND IN PCS

Beer industries soft drinks & Wine Total plastic
Minerals industrie crates
industries s demand in
pcs
2016/17 29,478,788 124,860,396 894,117 155,233,300
2017/18 33,418,182 139,843,643 974,592 174,236,416
2018/19 59,680,808 156,624,878 1,062,30 217,367,986
0
2019/20 59,680,808 175,419,874 1,157,90 236,258,591
8
2020/21 59,680,808 196,470,256 1,262,12 257,413,189
5
2021/22 59,680,808 220,046,683 1,375,71 281,103,208
7
2022/23 59,680,808 246,452,285 1,499,52 307,632,618
5
SOURCE: OWN CALCULATION
4.6. SUPPLY CONSIDERATION
4.6.1. DOMESTIC PLASTIC CRATES PRODUCTION
Currently, there are only few plastic crates factories in the country –The major plastic crates
manufacturing factories are Addis Gas and plastic plc and universal plastic plc.
Page 33
 ADDIS GAS AND PLASTIC UNIVERSAL PLASTIC PLC
The Company has injection molding machines to produce different plastic products –
crates, chair, fluid containers, etc. Injection molding uses a piston or screw to force plastic
resin through a heated tube into a mold, where the plastic cools and hardens to the shape of
the mold. The mold is then opened and the plastic cast removed.
Thermoplastic is recyclable. The Company has such facility to recycle waste plastics and re-
use them in the process of plastics making. This recycling service is also available to outside
customer
The local production for plastic crates is increased from year to year except year 2000 and
2003. During 1999 E.C the local production for crates were only 652,000 PCS and this
amount decreased to 601,000 pcs. By the years 2001 and 2002 the local production has
increased to 1,114, 000, and 1,768,000 pieces, respectively.
TABLE 7: LOCAL PLASTIC CRATES PRODUCTION
Quantity 'PCS
1999 652,000
2000 601,000
2001 1,114,000
2002 1,768,000
2003 1,387,000
2004 1,789,230
2005 2,308,107
2006 2,977,458
Source: CSA, 2015
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5 5. FIBER CONTAINER AND PET

PREFORM MARKET STUDY
5.1. FACTORS AFECTING THE MARKET FOR FIBER CONTAINER AND PET PERFORM
The demand for Fiber container is drivers by economic growth, population growth,
urbanization, population growth & demography, and growth of beverage market and etc.
The major demand drivers for Bottled water are described as follows;
5.1.1. ECONOMIC GROWTH
During the last decade, Ethiopia has made strides in economic and social development and
robust economic growth averaging more than 10 percent since 2001/02. According to IMF
report 2013, following the dramatic decline in the incidence of poverty over the last decade,
nonmonetary dimensions of well-being have also improved, including in the rural areas.
Based on the Human Development Index (HDI), Ethiopia has been successful in translating
economic growth into higher living standards for the citizens and has outperformed many
sub-Saharan African countries and a number of non-African countries (indicated by
Ethiopia’s higher actual HDI than that predicted by a cross-country correlation between the
HDI and per capita gross national income.
The agriculture, industry and service sectors’ annual average growth was 9.3%, 12.2% and
12.4 %; respectively as reported by MOFED on the same period. According to IMF, the
economy is also estimated to grow consistently for the next three years with an average
growth rate of 9 % as shown below.
Page 33
TABLE 8: GDP AT CONSTANT PRICE
5.1.2. SOURCE: IMF, 2013
5.1.3. POPULATION GROWTH
The 2007 Population and Housing Census results show that the population of Ethiopia
grew at an average annual rate of 2.6 percent. Accordingly, the total population of Ethiopia
is projected to reach 100 million within the next five years from 84.3 million in 2011. The
following figure shows the population projection for the next five years with 2.6% per
annum.
FIGURE 14: POPULATION PROJECTION (IN MILLIONS)
Object 25
SOURCE: CSA
Page 33
The increase in population is estimated to increase the demand for fiber container and
plastic pet-preform product increased. This implies that the demand for fiber container and
plastic pet-preform products also increase.
5.1.4. URBANIZATION
As urbanization indicates people’s living style, it’s a major factor for a higher demand of
goods and services. High concentrations of people and economic activity in urban areas are
often associated with high level of demanding the glue product.
In Ethiopia, Urban population growth rate is projected to increase by 4% annually. By the

end of the 2015, the total urban population estimated about 17.5 million as shown below.
FIGURE 15: URBAN POPULATION (2015)
Object 27
SOURCE: CSA PROJECTION (2014-17)
From the total Ethiopian Urban Population, Addis Ababa holds around 19% of the urban
population followed by Gondar and Mekelle with 2% share as shown in the figure below.
Page 33
FIGURE 16: POPULATION IN MAJOR CITIES (2015)
Object 30
SOURCE: CSA 2015
This rapid expansion of urbanization and growth of urban population has too often
exceeded the capacity to provide fiber container and plastic pet- preform production.
5.1.5. DOMESTIC POPULATION GROWTH AND DEMOGRAPHY
Population is a key driver of Bottled water demand. According to CSA, the population of
Ethiopia grew at an average annual rate of 2.6 percent between 1994 and 2007. As shown
below, the number of population is expected to be 129 million in year 2030 from the
current number of 85 million. From the projection, the number of population in year 2030
will be doubled of number of population in year 1995 EC.
TABLE 9: ETHIOPIA: POPULATION PROJECTION, 1995-2030
Page 33
Object 32 SOURCE
: CSA
Demographics within a population can also play a significant role in plastic pet-perform,
demand, in terms of age and household size. The distribution of the national population by
broad age groups shows that the proportion of young population under age 15 is about
45% while the proportion of the working age group 15 – 64 is estimated to be 50.2 %. Elder
persons (65+) composition accounts 3.4% of the total population being the lowest. The
distribution shows most populations are in working age and are estimated to increase the
demand of fiber container and plastic pet- preform products.
5.1.6. IMPURE AND IMPROPER MUNICIPAL WATER SUPPLIERS
Municipal sources are the main sources of water supplied to the house hold. From pass
time, this source becoming impure and improper. To making food, to drink and other
application of water was from the municipal source firstly. But as time span health
consciousness increase which avoids the impure quality of municipal suppliers.
5.1.7. EDUCATION AND HEALTH CONSCIOUSNESS
As literacy rate increasing the education level increasing because of education level
increasing and the health consciousness improved among the people. Health conscious
people prefer the products which are not hazardous to the body for example using
municipal water most people prefer bottled water.
Page 33
5.2. DERIVED DEMAND FOR PLASTIC PET-PERFORM AND CAPS

5.2.1. BOTTLED WATER
5.2.1.1. DOMESTIC DEMAND FOR BOTTLED WATER
Mineral/bottled water business is still at infant stage and is a newly growing business in
Ethiopia. Previously the market was dominated by the government owned Ambo mineral
water and the picture changed with the success of Highland natural spring water and many
joined the business with different brands. The market is dominated by locally produced
purified water and also small quantities of imports of different brands which is mostly
available in prominent supermarkets.
Demand for bottled water is driven by a variety of factors; the perception that bottled water
may be safer than local municipal water, a new clean bottle, taste preferences and size and
shape of the bottle. Even in areas where tap water is safe to drink, demand for bottled water
is increasing. For safety purpose and due to the acute shortage of water supply for
consumption in major cities, households are forced to purchase bottled water of different
size for drinking purpose.
The demand for bottled water can be estimated using various techniques but the most
reliable method is using consumption per capita of other countries with in developing
countries range. We consider the demography of population as a major determining factor
for the utilization of bottled water. Therefore, for this project, we segment the market as
urban and rural. And rural consumption of bottled water is 20% of urban demand which is
16.8 Liter per capita (Southern African consumption in 2013: SANBWA).
TABLE 10: PROJECTED ANNUAL DEMAND (HECTOLITERS)

Urban Rural Total Country Demand in
Regions Urban Pop Demand Total Urban Rural Pop Demand Total Rural demand Hecto
(2014) per capita Demand (2014) per capita Demand (Litters) Litter
Tigray 1,200,000 16.8 20,160,000 3,760,000 3.36 12,633,600 32,793,600 327,936
Afar 289,000 16.8 4,855,200 1,389,000 3.36 4,667,040 9,522,240 95,222
Amhara 3,127,000 16.8 52,533,600 16,892,000 3.36 56,757,120 109,290,720 1,092,907
Oromia 4,647,000 16.8 78,069,600 28,169,000 3.36 94,647,840 172,717,440 1,727,174
Somalia 763,000 16.8 12,818,400 4,544,000 3.36 15,267,840 28,086,240 280,862
Ben. Gumz 189,000 16.8 3,175,200 787,000 3.36 2,644,320 5,819,520 58,195
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SNNP 2,707,000 16.8 45,477,600 15,130,000 3.36 50,836,800 96,314,400 963,144

Gambela 124,000 16.8 2,083,200 272,000 3.36 913,920 2,997,120 29,971
Hareri 125,000 16.8 2,100,000 101,000 3.36 339,360 2,439,360 24,394
Addis 3,195,000 16.8 53,676,000 - 3.36 0 53,676,000 536,760
Ababa
Diredawa 268,000 16.8 4,502,400 159,000 3.36 534,240 5,036,640 50,366
Others 41,000 16.8 688,800 75,000 3.36 252,000 940,800 9,408
Total 16,675,000 280,140,000 71,278,000 239,494,080 519,634,080 5,196,341
SOURCES: CSA, BEVERAGE MARKET CORPORATION & OWN CALCULATION
It is very difficult to incorporate all the factors those could affect the demand for water in
the demand projection. Therefore; we projected demand based up on the major influential
factors; GDP growth and population growth. The average GDP growth rate for the last three
years is 8% and the population growth is estimated 2.1% per annum. Totally, 10.1% growth
rate is assumed for the next five years in the water industry. Accordingly, the demand for
water is estimated to reach 5.7 million hectoliters as shown in the following demand
projection in the year 2024.
TABLE 11: DEMAND PROJECTION

Year Bottled water demand (HL)
2015 5,721,171
2016 6,299,010
2017 6,935,209
2018 7,635,666
2019 8,406,868
2020 9,255,962
2021 10,190,814
2022 11,220,086
2023 12,353,314
SOURCE: CSA, MOFED AND OWN CALCULATION
5.2.1.2. DOMSTIC SUPPLY FOR BOTTLD WATER
In general terms, the size of urban population, national income level, climatic conditions,
age group and the availability of substitutes affect the demand for bottled water. Taking
these factors into account, the current effective demand for bottled water in the country,
having more than 88 million populations is estimated at 268 million half litter bottles.
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Bottled water production (carbonated water) has such a long history in Ethiopia. ‘Ambo
Wuha’ is the oldest bottled carbonated water brand in Ethiopia. Currently, there are more
than 15 operational firms in the country, being distributed around major regions. The
major known brand names include: Aqua Safe, Aqua Addis, Abyssinia, Yes, Origin, etc.
Currently there are about twenty-four purified bottled water manufacturers in the country
all supplying water range of 0.5 liter to 2 liters. In some cases, it is supplied in jar of 20
liters with dispenser and 5-liter bottle water.
Bottled water is the fastest-growing beverage category in the world: it has expanded from a
tap water substitute into the beverage arena. Bottled water business is still at infant stage
and is a newly growing business in Ethiopia. In the Ethiopia, there are about 50 brands of
bottled water produced. Most of these companies are located in the region Oromia, Tigray,
Amhara and Addis Ababa.
TABLE 12: LIST OF BOTTLE WATER IN ETHIOPIA

SR. NO BRAND NAME COMPANY NAME
1 Abyssinia Great Abyssinia plc
2 Aqua Addis Burayu Spring Water plc
3 Aqua Billen Ferej& Family Plc
4 Aqua Afric Seka Business group. Pvt.ltd
5 Ayann Dire dawa Ethiopia
6 Bebile
7 Classy Belaye bottled Company Plc
8 Cool MohaPlc
9 Dessie spring Dessiemededa spring industry
10 Guna
11 High land
12 Life Clean Plc
13 Mercy Mehari Fisseha bottling factory
14 My lommi Seka Business group. Pvt.ltd
15 Origin Electro commercial
16 Prima Aqua Afman trading
17 Real Access Capital
18 Soda water Coo lice food Complex
19 Spa Herbel Trade & industry plc
20 Tana Ashref
21 Top land Belaye bottled Company Plc
22 Utopia Apex bottling company
23 Viva
24 Aqua safe Debire behiran natural spring
25 Eden Eden business S.C
26 Oasis
27 Cheers Vaiolet General Trading PLC
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28 Blu Almaz Eshet Kebede Mineral Water Factory

29 Agmas Agmas Manufacturing PLC
30 Dasany East Africa Bottling
31 Liban Aqua Dire Dawa Bottled water Abdulreshed Elemi Food Complex
32 Tiret
33 Sky
34 Diamond
35 one Abbahawa Trading PLC
36 arki SBG industry PLC
37 SPA water
38 Ayan Bottled Water Ayane Mineral Water PLC
39 Drinking Water Harbele Trade Industry
40 Promise Bottled water Pasfeke Industry
41 Vita Bottled Water Twin Cits Industry PLC
42 Right Bottled Water Maiaynee Business PLC
43 Nice Bottled Water Fresewat Trade work PLC
44 Bekoje Bottled Water Bekoje Spring Water PLC
45 Dera Bottled Water Dalole High Level PLC
46 Viva Bottled Water I T F PLC
47 Safi Bottled Water Safi Natural Water Fabric
48 Aqua Siliva Mineral Water Aqua Seliva Bottled Water
49 Bottled Water S H F Trading PLC
50 Classic Bottled Water Belay Industry
SOURCE: MARKET SURVEY
Bottled water is by far the most popular drink produced and consumed in Ethiopia.
According to Central Statistics Agency, bottled water (mineral water) accounts for about
56% by volume of beverages produced in the year 2014 with alcohol and wine being the
lowest.
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that, for the year 2012/2013 about 4 million hectoliters of bottled water products were
produced. As shown in table and figure below, the total production of bottled water has
With regard to domestic production the general trend has been increasing. Domestic
production during the year 2007/08 was 495,227 hectoliters but in 2012/13 the water
production in Ethiopia has been increased to 4,000,826 hectoliters. In general, the supply of
water to Ethiopian market in the past five years from domestic production was 74%.
FIGURE 18: TRENDS FOR LOCAL WATER PRODUCTION
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Object 34
SOURCE: CSA, LAGER AND MEDIUM
Hence, its demand will exist even if rivers are available whether in rural or urban areas.
The past supply trend also reveals that despite the expansion of water the consumption has
been increasing in the past few years. By associating with production growth, population
and the service sector, an annual average growth rate of 11.7% is taken to project the future
demand.
TABLE 13: PROJECTED WATER PRODUCTION IN HECTOLITER

WATER PROJECTION IN WATER PROJECTION IN
YEAR
HECTOLITER LITER
2013/14 4,468,923 446,892,264
2014/15 4,991,787 499,178,659
2015/16 5,575,826 557,582,562
2016/17 6,228,197 622,819,722
2017/18 6,956,896 695,689,629
2018/19 7,770,853 777,085,316
2019/20 8,680,043 868,004,298
2020/21 9,695,608 969,560,801
2021/22 10,829,994 1,082,999,415
2022/23 12,097,103 1,209,710,346
SOURCE: NOBEL TEAM COMPUTATION
In addition to local produce, mineral waters of various brands are currently imported from
different countries. But, due to their higher prices the total imported amount is
insignificant and their distribution is limited mainly to Addis Ababa market only. However,
the major cities host to an ever-increasing number of hotels, restaurants and foreign
visitors thereby increasing the demand for mineral water.
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5.2.1.3. DOMESTIC MARKET DEMAND AND SUPPLY GAP
The continuation of various demand driving factors in Ethiopia ascertain the significant
increase in bottled water consumption in urban and rural Ethiopia. Considering the water
bottling industry in Ethiopia is at early stage of development and small number of player
are existed in the market. The demand and supply is expected to increase as demand is
increasing up to 10.2% per annum and supply average increase is only 11.7% annum as
shown in the following chart.
TABLE 14: DEMAND AND SUPPLY GAP

Projected Bottled Projected Bottled
Year DD-SS Gap (HL)
Water DD (HL) Water SS (HL)
2015 5,721,171 4,991,787 729,384
2016 6,299,010 5,575,826 723,184
2017 6,935,209 6,228,197 707,012
2018 7,635,666 6,956,896 678,770
2019 8,406,868 7,770,853 636,015
2020 9,255,962 8,680,043 575,919
2021 10,190,814 9,695,608 495,206
2022 11,220,086 10,829,994 390,092
2023 12,353,314 12,097,103 256,211
SOURCE: OWN CALCULATION
5.2.2. EDIABLE OIL
A. DOMESTIC EDIBLE OIL PRODUCTION
In Ethiopia, edible oils are consumed both as industrially processed oil and in domestically
prepared forms. Oil seeds are also used for various other food preparations.
According to Central Statistics Authority’s report on large & medium scale manufacturing
and electricity industries survey published in August, 2012, there are about 36
establishments engaged in manufacture of vegetable and animal oils & fats. Out of this 2 are
under public ownership while the rest are privately owned. The production capacity of
some of the major edible oil processing plants is shown the table below.
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TABLE 15: EDIBLE OIL PROCESSING PLANTS

Factory Name Factory Capacity in Ton
Addis Mojo 14,000
Hamaressa 5,400
Bahir Dar 1,000
Gondar 3000
Dil 5445
Adama 1,452
Akaki 1365
Nazareth 1,500
Ediget 938
Dire Dawa 800
SOURCE: MINISTRY OF TRADE AND INDUSTRY
Among the existing edible oil producing factories edible oil, Addis-Mojo Oil complex
Hamaressa Edible Oil S.C` and Bahirdar Oil Mill are notable excelling others in production
capacity. The total production of edible oil in Ethiopia for the years 1999-2005 is given
below.
FIGURE 19: DOMESTIC PRODUCTION OF EDIBLE OIL
Object 36
SOURCE: CSA, LARGE AND MEDIUM MANUFACTURING
Local oil production of edible oil was 5,704 ton in 2008/09 then decline to 4,319 ton in
2012/13. In 2009/10 was the highest production of edible oil which is 10,881 the gap
between supply and demand covered by imports were supplied by the private sector when
prices skyrocketed leading the government to successively introduce a price cap, and later,
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in May take over the import of palm-oil altogether, distributing it at a subsidized price for
consumers.
B. IMPORT OF EDIBLE OIL
Ethiopian domestic production was never being sufficient to meet the country’s demand till
today, the inability of domestic production to keep up with demand growth has led to
increased imports of edible oil. Ethiopian rural areas use animal fats as major meal oil in
1980-1990’s now their consumption pattern is being changed significantly and their
consumption of vegetable oil reaches 2.1 kg per person, the average consumption of oil
seed in urban region is 4.1 kg/person. However, The Government, with a view to avoiding
scarcity of this item and continuous rise in prices, allowed liberal import of edible oils.
Ethiopia has been importing edible oil from various countries to meet the demand. The
figure below indicates the total import of edible oil.
TABLE 16: IMPORT OF EDIBLE OIL

Average Average CIF
Year Net Wight CIF Value
Net Value Value
2010 1,142,392.31 21,429,960.40
2011 2,227,865.95 66,705,645.84 95% 211%
2012 1,453,084.27 43,561,237.49 -35% -35%
2013 1,266,198.95 28,659,196.22 -13% -34%
2014 3,199,218.16 106,380,145.01 153% 271%
2015 9,718,464.97 326,127,894.79 204% 207%
Average 81% 124%
SOURCE: ERCA
As can be observed, import of edible oil has a general trend of increase with fluctuations
from year to year. The value of imported edible oil has shown an increasing trend
throughout the years under consideration implying the huge volume of hard currency that
the country is paying to get the commodity.
C. TOTAL SUPPLY AND SUPPLY PROJECTIONS
It is apparent that the domestic supply of Edible Oil is the sum of total production by the
existing establishment in the country and import. In this regard, to know the supply of
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Edible Oil, we have summed the local production and import as presented in the figure
below.
FIGURE 20: TOTAL SUPPLY OF EDIBLE OIL (IN LITERS)
Object 38
Comparing the import and local production of edible oil, substantial amount of edible oil
has been imported outweighing the local production. The share of local production from
total edible oil accounted only an average of 2.94% in the years under consideration.
D. LOCAL EDIBLE OIL SUPPLY PROJECTION
The local supply of edible oil has been growing at an average of 7% during the years 2002 –
2005 E.C. (2008/09- 2012/13). For the projection of edible oil supply by local producers,
this average annual growth rate i.e. 7% is applied on the production recorded in year
2012/13. The table below presents the projected local supply of edible oil.
TABLE 17: PROJECTED LOCAL SUPPLY OF EDIBLE OIL

Projected Local Edible
Year
Oil Supply in Liter
2014 10,149,500.00
2015 10,951,360.00
2016 11,753,220.00
2017 12,555,080.00
2018 13,356,940.00
2019 14,158,800.00
2020 14,960,660.00
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5.2.3. CSD (CARBONATE SOFT DRINK)
A. CSD LOCAL PRODUCTION
The Ethiopian Soft Drink Market is dominated by two players; MOHA soft drink industry
(MOHA) and East African Bottling Share Company (East African). These two companies
respectively bottle and distribute their flagship products Pepsi Cola and Coca Cola along
with other sister brands. Between the two companies the Ethiopian soft drink market is
supplied about 40 million3 crates 4 annually.
Soft drinks in Ethiopia are marketed most of the time in 300ml glass bottles. Although the
market is dominated by 300ml size bottles, 500ml and 1000ml bottles are also in the
market.
Admittedly the oligopoly nature of the soft drink market in Ethiopia makes it difficult for a
new entrant to succeed in taking market share away from the established companies.
However, there is evidenced lack of sound management capability and experience as well as
inefficiency in utilizing available resources.
The future of the soft drink market is expected to be positive considering the following
factors:
 Population urbanization and awareness of such products.
 Continuous increase of the real GDP as evidenced by the double-digit growth over the last
decade which is creating a new market every year.
 Government initiative to support the expansion of the manufacturing market with
incentives such as tax holidays.
 Ease of reaching the rural population as result of expedient development of the country’s
infrastructures.
Soft drinks are by far the most popular drink produced and consumed in Ethiopia.
According to Central Statistics Agency, soft drinks (lemonade) accounts for about 29% by
volume of beverages produced in the year 2014 with alcohol and wine being the lowest.
3 Source: Fortune Newspaper, February 22, 2009; Volume 9, Number 460.
4 One Crate equals 24 bottles of 300ml.
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Object 40
that, for the year 2010/2011 about 3.7 million hectoliters of soft drink products were
produced. As shown in table and figure 39 below, the total production of soft drinks has
FIGURE 22: SOFT DRINK PRODUCTION
SOURCE: CENTRAL STATISTICS AUTHORITY
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Currently the production of soft drinks is dominated by two companies, namely East
African Bottling and Moha Soft Drink Industries. Encouraging efforts was made by Great
Abyssina PLC, Asku PLC & Ambo Mineral Water S.C by introducing Tonic, orange & energy
cola, etc. The following table 11 presents the profile of major players in Ethiopia soft drink
sub-sector.
TABLE 18: PROFILES OF MAJOR ETHIOPIAN SOFT DRINKS INDUSTRY PLAYERS
1. East African Bottling Share Company (EABSC)

Company profile Coca-Cola was first bottled in Ethiopia’s capital Addis Ababa in 1959 by the
Ethiopian Bottling Share Company, which later opened a second branch in Dire
Dawa in 1965. The two plants were nationalized in 1975 and ran as public
companies until 1996 when they were bought by Ethiopian entrepreneurs. Just
prior to this, in 1995, Coca-Cola Sabco bought shares in the business and, in 1999,
signed a joint venture agreement with the plants. Having invested around 500
million USD South African Beverage Company (SABCO) Coca-Cola currently holds
around 82pc share in the Ethiopian company, while the remaining 18pc is owned
by two of the original shareholders, Negussie and Munir, as well as Dereje
Yesuwork, and Abinet G. Meskel. In 2001 the company changed its name to the
East African Bottling Share Company (EABSC). East Africa Bottling or EABSC has
grown so much ever since the mid-1990s. Between 2001 to 2003 EASBC
performed the expansion work for the Dire Dawa Plant, which replaced the old
production line of the plant, at a capacity of two million cases a year, by a new
modern production line at a capacity of seven million cases. Overall EABSC's
expansion project, that cost 12 million dollars spent on procurement of two plants
and a bottle washing machine, helped it enhance its production capacity from five
million crates in 1995 to 21 million crates in 2010.
Products EABSC produces soft drinks under the following brands - Coca Cola, Fanta, Coca-
Light, Sprite, and the Schweppes group (i.e., Fanta Orange & Pineapple). In May
2012, EABSC officially added Fanta Strawberry to the already existing brands
listed above.
Annual Sales turnover The Annual Turn-over of the company was reported around USD100 million in
(USD/Birr) 2010/11 The company has employed around 1,000 permanent employees.
Location of EABSC currently operates across 2 plants, one in Addis Ababa and the other in
Filling/Bottling Dire Dawa town (525 Km from Addis)
Plants (in Addis &
Regions)
Current Production 80,000 cases per day from its two plants; although EABSC has most recently
Capacity (per day) & upgraded by more than 2 folds both is plants production capacity by adding new
Market Share production lines
Addis Ababa:
 New line: 42,000 lt/hr
Currently New line is operational
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Dire Dawa:
 New line: 36,000lt/hr
 Old line 12,000lt/hr
Currently new line is operational
(i.e., Addis Ababa: 42,000 liters/hour & Dire Dawa: 36,000 liters/hour). At
present, EASBC has a national industry market share of around 45 percent.
Most recently, East African Bottling Share Company (EABSC) announced an eight-
Expansion projects & year investment spree of nearly nine billion Birr, intended to make Ethiopia its
New Investments number one market in Africa by the year 2020. Already underway is the
construction of a five-storey production building in the company compound in
Addis Ababa at a cost close to 18.6 million dollars or 330 million Br. These
buildings are part of a 52 million-dollar or 923 million-Br expansions, intended
for the Addis Ababa Plant, including the installation of two additional production
lines, bringing the total to five. One of these lines will be dedicated to packaging
the company’s beverages in plastic bottles. The original expansion of the Dire
Dawa Plant, which saw production grow to seven million cases, cost 20 million
dollars. The new expansion, expected to cost the same amount of money as part of
Plan 2020, will see the installation of one more line in 2012/13. When the Addis
Ababa and Dire Dawa expansions are finalized, the company expects a total
annual production of 45 million cases. The plan includes three new plants in Bahir
Dar, Hawassa, and a third plant to be located in western Ethiopia in a city yet to be
identified.
2. MOHA Soft Drinks Industry Share Company
Company profile MOHA soft drinks Industry S.C was established on May 15, 1996 acquiring four
Pepsi plants (Nifas Silk Plant, Tekle Haimanot Plant, Gondar Plant, and Dessie
Plant) from the Ethiopian Privatization Agency with paid capital of Birr
108,654,000 and as part of MIDROC Ethiopia Group Companies.
In addition to the initial purchase price of the Soft Drinks factory, MOHA has
invested Birr 8 Million for the expansion of new projects, Birr 153 million for
refurbishment and replacement of existing plants and Birr 241 million for
marketing, infrastructure, excluding advertisement and sponsorship expenses.
Products Major products of MOHA Soft Drinks Industry S.C. are: Pepsi Cola, Mirinda
Orange, 7-Up, Mirinda Tonic, Mirinda Apple (all Pepsi Brands), and Kool (Bure
Kool and Tossa bottled water products). MOHA also plans to introduce new
products like Pepsi Max and Diet Pepsi brands.
Annual Sales Annual turnover has reached around Birr 556 million and sales stands at an
turnover (USD/Birr) average annual growth rate of 12%, providing 2,485 jobs for citizens out of
which 1,095 are new employment opportunities since acquisition.
Location of MOHA currently has 7 operating units including three found in Addis Ababa
Filling/Bottling Plants including the Nefas Silk Pepsi Plant, Teklehaimanot Pespsi Plant, and one
(in Addis & Regions) franchised Summit Beverage Plant; as well as across regions including three in
the Amhara Regional State (410 km Bure Pespsi & Kool Water Plant, 650 Km
Gondar Pepsi Plant, and the 385 km Dessie Pespsi & Tosa Ambo Water Plant),
and the recently inaugurated Hawassa Plant (270 Km) in the Southern Nations &
Nationalities People's Regional State (SNNPR).
Moreover, MOHA is marketing 20pc of its products in plastic bottles of in half,
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one, 1.5 and 2.25-litre sizes.
Current Production 99,000 cases per day from all its operational plants across the country. Currently
Capacity (per day) & MOHA commands a 52 percent share of the market in soft drinks industry in the
Market Share country
Expansion projects & MOHA envisages an average annual increase of 15% in sales volume and a
New Investments corresponding profit growth. The company has already set a new PET-line at ITS
Summit Plant: 12,000 bottles per hour with 1.5-liter bottle capacity (both for soft
drinks and bottled water) which went operational as of October 2010 with total
estimated investment cost of around Birr 130 million Birr. MOHA's upcoming
investment projects include: the Adigrat Pepsi Cola Bottling Plant in Tigray
Region (872 Km) with total estimated investment cost of Birr 208 million & the
Dessie Pepsi – Cola & Carbonated Water Plant (385 Km) in Amhara Region with
total estimated investment cost of around Birr 208 million
3. Great Abyssinia PLC
Company Profile Great Abyssinia has its roots back to the early 1990's when it was established as a
sole proprietorship company. The then Abyssinia coffee and tea processing
enterprise had started out with less than ten employees by roasting, grounding and
packaging Arabica coffee using an old dilapidated machine for exclusive domestic
market consumption.
Products Currently Abyssinia is producing Tonic and coffee cola carbonated drink bottled in
half and one liter bottles. The company has finalized to launch a range of new tastes
of carbonated drinks like cheers orange, fresh & lemon
Currently, Abyssinia is marketing Tonic and coffee cola in half and one liter PET
Sales/turnover bottles. The annual sales of Tonic & coffee cola are about 155 million Birr. Almost all
Tonic & coffee cola products are being sold in regions by agents. Only small
percentage of the product is being sold in the capital Addis Ababa.
Current Production Abyssinia installed machinery for its soft drink filling line. The capacity is 10,000
Capacity (per day bottles (half liter bottles) per hour.
Expansion Great Abyssinia planned to set a new PET-line at Legetafo Plant: 24,000 bottles per
projects & New hour with 0.5-liter bottle capacity which went operational as of October 2015. This
Investments will boast the company market share in the soft drink sub sector further to 13% in
2015 working at full capacity.
4. ASKU PLC
Company Profile Located in the vicinity of Burayou Spring water (Aqua Addis) in Burayou town, Asku
PLC started its soft drink production before Two years. The company bottles RC cola
International Brands with Non – Returnable PET bottles.
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Products Royal Crown soft drink

 Cola
 Orange
 Lemon
5. AMBO MINERAL WATER S.C
Company Profile Ambo mineral water factory was established 80 years ago in Sekele locality near a
hot spring 130 km west of Addis Ababa. The factory had dominated 85 percent of
the mineral water market. The factory was nationalized in 1974 and it was partially
privatized in 2008. An Ethiopian businessman, Tewodros Ashenafi, in partnership
with South African brewery company, SABMiller bought the factory from the
Ethiopian Privatization Agency two years ago. SABMiller and SouthWest
Development, a company established and managed by Tewodros forged a joint
venture company, Ambo Mineral Water S.C., with the Ethiopian government. The
share company has 3,607,000 shares with a total par value of 300,607,000 birr.
Products Ambo Original
 475 ML returnable glass
 330 ML non-returnable glass
 250 ML PET
Ambo Lite
 500 ML PET
 250 ML PET
 1 Lit PET
 2 Lit PET
Flavored Ambo - Orange, Apple, Pineapple and Lemon
 250 ML PET
 500 ML PET
 1 Lit PET
 2 Lit PET
Current Production The Ambo mineral water manufacturing plant had two lines which have a total
Capacity (per day production capacity of 14,000 per hour. The two old lines were renovated and
another new line was installed. The new line alone has a production capacity of
24,000 bottles per hour.
Expansion projects Ambo Mineral Water S.C., the bottler of the popular Ambo mineral water, on
& New Investments Thursday announced that it had undertaken a major expansion project on its
mineral water manufacturing plant near Ambo town at the cost of 21 million dollars.
SOURCE: SURVEY OF COMPANIES AND INDUSTRY EXPERTS; VARIOUS ARTICLES AND RESOURCES
B. CSD IMPORT
In addition to the local production of CSD, the country has been importing CSD products
that have been growing by 65% on average reaching Birr 29 million worth of CSD import.
Canned CSD products are the major type of CSD import due to the fact that the local
industries are not producing in canned form. Soft drinks are being imported mainly from
UAE in to the country with aluminum cans.
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TABLE 19: IMORT OF CSD FROM 2009 TO 2015

Average
Year Net Wight CIF Value Average CIF value
net value
2009 313403.75 3742361.25
2010 340,381.14 5,744,697.77 9% 54%
2011 505,895.32 8,408,008.84 49% 46%
2012 1,680,662.29 20,133,771.66 232% 139%
2013 1,266,198.95 28,659,196.22 -25% 42%
2014 813,373.26 21,256,584.80 -36% -26%
2015 2,136,297.43 29,828,566.77 163% 40%
Average 65% 49%
SOURCE: ERCA
C. CSD SUPPLY AND DEMAND GAP
The existing soft drink production companies have been established before 50 years
without undergone a major expansion relative to the population and urban development.
This slow development in a soft drink industry has cause stagnation in a consumption of
soft drink for the last half century and the price of the soft drink has increased led by strong
demand.
As shown below in following chart the demand and supply gap is estimated above five
hundred thousand hectoliters and is expected to stay in same figure for the next ten years.
TABLE 20: CSD DEMAND SUPPLY GAP
A. JUICE LOCAL PRODUCTION
The untouched Ethiopian juice market doesn’t have many players; the major juice producer
in the local market would be Great Abyssinia PLC (Prigat), Piko Juice PLC (Snap), Yami Juice
(Yami), Africa Juice, Merti, which are producing natural fruit juices with flavors such as
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mixed fruit, mango, apple and others. All the local products are non-aseptic and mostly are
made from natural fruits packaged in plastic, Tetra Pack or paper. Generally, Local juice
production doesn’t have significant contribution to the local market for the last five years.
TABLE 21: JUICE PRODUCTION
Object 42
SOURCE: CSA
B. JUICE IMPORT
The imported juice products are more available in the local market than the local
productions. The imported products consist of natural juices, concentrates and nectars. The
unrestricted imports and growing local production don’t satisfy the demand for juice that
opens a door for the retailers and supermarkets to sale a juice product with high price.
As can be seen in Table 20, the import of packed juice has been declining from 3,346 ton to
891 ton through the period 2006 to 2013 while the import of Juice concentrate on the other
hand shown a tremendous growth from 230 ton to 12,742 ton from year 2009 to 2013
implying a change from importing packed juice to companies participating on packaging
the juice products while importing concentrate.
Juice manufacturing industry includes businesses that process, blend and package their
own products for the consumer market. They are also referred to as converters. Products
made by this industry may be labeled juice, nectar, fruit juice or freshly squeezed juice.
Juice processing industry is very important both for the internal and the external market.
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TABLE 22: ETHIOPIAN JUICE & CONCENTRATE IMPORT
CIF VALUE (IN GROWTH IN GROWTH IN

YEAR VOLUME (KG)
BIRR) KG VALUE
2009 9,429,936 80,548,749
2010 6,707,379 71,246,395 -29% -12%
2011 8,164,506 110,763,371 22% 55%
2012 12,990,996 177,632,648 59% 60%
2013 13,633,256 216,811,835 5% 22%
2014 13,812,449 234,516,231 1% 8%
2015 14,871,150 266,799,144 8% 14%
Average Growth 11% 25%
SOURCE: ETHIOPIAN REVENUE CUSTOMS AUTHORITY
The total projected packed juice supply expected to increase from 5,336 ton in 2015 to
37,633 in 2023. Likewise, projections are made based on the average growth rate of the
production and import for the last seven years.
TABLE 23: PROJECTED TOTAL JUICE SUPPLY

Year Demand Supply Total SS
2016 5,336.00 17,537.00 22,873.00
2017 5,776.00 19,205.70 24,981.70
2018 6,216.00 20,874.40 27,090.40
2019 6,656.00 22,543.10 29,199.10
2020 7,096.00 24,211.80 31,307.80
2021 7,536.00 25,880.50 33,416.50
2022 7,976.00 27,549.20 35,525.20
2023 8,416.00 29,217.90 37,633.90
C. JUICE SUPPLY AND DEMAND GAP
Though declining, as shown on juice import data from customs authority, Ethiopian juice
demand is mainly satisfied from imported products. Therefore, the expansion will have
plenty of opportunity to substitute the imported products and expand their opportunities
to meet the unsatisfied demand existing in the local market. The current production and
import trend shows by the end of 2014 the demand and supply gap will reach 348,531 tons.
TABLE 24: JUICE DEMAND SUPPLY GAP
Page 33
Object 44
A review of Ethiopian market shows that dramatic changes are occurring. Demand is rising.
The key factors, which are likely to cause demand to rise are growing income and changing
in demography. The propensity to consume juice products is rising.
As indicated, the domestic market is being supplied by local as well as imported products.
The size of the domestic market is considerable with the growing population and
demographic change.
5.3. LOCAL PRODUCTION OF FIBER CONTAINER PET-PREFORM BOTTLES AND

CAPS
5.3.1. SUPPLY OF FIBER CONTAINER
The local market of the fiber containers is supplied both local production and import. The
date for local production is not available while the import data for fiber containers is
presented below:
A. IMPORT
As shown in the table below, both the value and volume of import fiber containers is
increased from time to time because of there is a huge demand for the products. In 2011
Page 33
the import value of fiber containers was 119 million and this figure increased 337.2 million
in 2015
FIGURE 23: FIBER CONTAINERS IMPORT DATA
NET WT. (KG) % CIF VALUE (ETB) %

2011 1,702,050.05 GROWTH 119,730,937.34 GROWTH
2012 1,623,666.50 -5% 121,157,162.18 1%
2013 2,085,352.71 28% 160,248,806.39 32%
2014 2,562,364.52 23% 337,230,883.71 110%
2015 2,316,224.89 -10% 222,408,948.95 -34%
AVERAGE GROWTH % 9% 27%
Generally, the demand for imported fiber containers increased by 9% during the last five
year. This shows that there are ample opportunities for fiber containers products in the
future.
MAJOR SUPPLIERS FOR FIBER CONTAINERS IN ETHIOPIA:
 ROTO PLC is a part of the flame tree group of companies, Nairobi, Kenya, which has
been manufacturing tanks in Africa for over 15 years with factories in over 7
countries in Africa.
 Sky Industries PLC is a manufacturing enterprise that is be producing various types

of Plastic items like Roto Tanks, Braided Hose, Suction Hose, Ropes and Twines, PP
Box Strappings, Jerry cans, kettles, PVC flexible Agriculture Pipes and
PVC/EVA/Leather shoes. These products are being used by a substantial number of
people both in the urban and rural areas of Ethiopia & overseas.
6. SUPPLY OF PET-PREFORM BOTTLES AND CAPS
The local market demand for PET- preforms bottles and caps is met through local
production and import. Accordingly, the trend in local production, import and total
supply/apparent consumption of the product is discussed hereunder.
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B. LOCAL SUPPLY
PET- preforms bottles and caps manufacturing is driven by the demands of the local
beverage factories engaged in the production and supply of bottled water, Soft Drinks, soda
mineral water, edible oil and pharmaceutical factories. Manufacturers consider several
aspects related to the customer (annual production capacities and actual production of
products), raw material (type, quantity and availability) and internal ability (expertise and
availability of labor, production process complexity and delivery time) for manufacturing
and delivering PET- preforms bottles and caps products.
Currently, there are three companies engaged production of PET- preforms bottles and caps
namely, Hagere Roha PLC, Burayu spring water bottling company and ITF PLC (producing
the bottled water called VIVA brand). These three companies all together have a production
capacity of xx million PET bottles and xx million pcs of Capps per year. Except Hagere Roha
PLC, the other two are producing for themselves and supply other local bottlers. The table
below presents the annual installed production capacities of these companies.
TABLE 25: SUPPLIERS OF PET BOTTLE

Installed Production Capacity Supply To Other Bottlers in
S. N Name of Company In PCS PCS
PET-Bottles Capps PET-Bottles Capps
1 Hagere Roha PLC 6,000,000 11,000,000
2 Burayu Spring Water 9,265,512
Bottling Company
3 ITF PLC
TOTAL
Since local production of PET- preforms bottles and caps is a recent phenomenon, there is no time
series data available on the local production of PET- preforms bottles and caps. On the other hand, a
research paper prepared by Ethiopian Development Bank’s Research Process Unit (Plastic Pipes,
Conduits, Fittings and Hose Manufacturing Commodity Study) indicates that local production of
plastic pipe fittings has commenced in 2010, with an estimated annual production of 264 tons.
C. IMPORT
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At present the major source of supply to the local market for PET- preforms is mainly import. The
product is imported by the local bottled water factories as well as distributors. The data source for
import statistics i.e. Ethiopian Revenue and Customs Authority classifies import of PET- preforms as
Bottle Performs of Plastics and plastic cap in H.S code heading of 39233010 and 39235000.
Accordingly, summary of total import of PET- preforms bottles during the period 2009 – 2015 is
shown in the table below.
TABLE 26: GLASS BOTTLE IMPORT FOR THE YEARS 2009-2015

CIF Value in Average growth Average growth of CIF
Year Net Wight
Million ETB of the net Wight value
2009 1,287,244.89 1,213,319.33
2010 2,139,045.40 62,177,968.84 66% 5025%
2011 3,187,088.01 140,790,598.90 49% 126%
2012 3,833,129.11 172,054,860.47 20% 22%
2013 5,769,683.34 250,472,550.87 51% 46%
2014 9,910,675.68 481,581,927.50 72% 92%
2015 12,087,790.21 576,749,344.98 22% 20%
Average 47% 888%
SOURCE: ERCA
As can be seen from the above table, import of PET- preforms bottles during the period under
consideration has shown a noticeable increasing trend except a decline in the year 2009. The
imported quantity which was 1.2 Million Kg during year 2009 has increased to 12 Million Kg in
2015. During the period 2006 – 2013 import of PET- preforms bottles has exhibited an average
annual growth rate of 47%.
Generally, the country spends a significant amount of hard currency for importing of PET- preforms
bottles. During the years under consideration (2009 -2015) the average CIF value of imported PET-
preforms bottles was Birr 240 Million. The CIF value of imported PET- preforms bottles on average
grew by 64.6% over the years under consideration. The highest and lowest import CIF value of Birr
576 Million and Birr 1 Million were recorded in the years 2013 and 2015, respectively. The figure
below shows the growth trend of imported quantity and CIF value for the years 2009 – 2015.
Page 33
FIGURE 24: IMPORTED QUANITYT AND CIF VALUE GROWTH RATE TRENDS 2008– 2013
Object 46
D. TOTAL SUPPLY
The apparent consumption or total supply of PET- preforms bottles, since there is no
record of export or re-export, is composed of domestic production plus import.
Accordingly, the structure of supply and apparent consumption of the product is
summarized in the table below.
TABLE 27: TOTAL SUPPLY OF PET- PREFORMS BOTTLES. (IN KG)
Growth Rate of
Domestic
Year Import Total Supply Total Supply
Production
(%)
2009 - 1,287,245 1,287,245
2010 - 2,139,045 2,139,045 66%
2011 - 3,187,088 3,187,088 49%
2012 - 3,833,129 3,833,129 20%
2013 - 5,769,683 5,769,683 51%
2014 - 9,910,676 9,910,676 72%
2015 - 12,087,790 12,087,790 22%
SOURCE: DBE & ERCA
As can be seen from the above table, during the period 2009 – 2015 the maximum total supply of
PET- preforms bottles was 12 million Kg in year 2015. During the time under consideration (2009 –
2015) total supply of PET- preforms bottles shows an increasing trend registering an annual
average growth rate of 47%.
Page 33
5.1. PRICE ANALYSIS
The pricing approach to be used by the project when operational will be cost plus pricing
approaching. The project will monitor the market and competitors’ pricing in order at best
possible way to offer its products at a lower price.
The company’s operation will revolve around utilizing technology and machinery in
efficient manner where wastage is limited. This strategy will enable the company to have a
competitive advantage over competitors’ when it comes to pricing.
For this project study purpose the lowest market selling price of Birr 165 per pcs
considered for revenue projection.
5.2. MARKETING STRATEGY

The company understands the key success factor in the plastic crates industry depends up
on Price, quality, Marketing and promotion, and delivery time. The following strategies are
given priorities to ensure the sales forecasts are achieved.
 Pricing strategy
o Affordable pricing.
o continuously monitoring competitors’ price
o Price revision is performed when the need arises
 Brand Equity Strategies
o Brand will be developed to create independent identity and image.
o Brand positioning statements will also be developed
 Distribution Strategy
o Product availability survey will be conducted regularly to know penetration level.

o Effective timely delivery as per clients order
o Intimate relationship with the beverage, cosmetics and pharmaceutical industries.
 Promotion Strategies
o Intensive advertisements on various multi Medias
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o Promotion will be conducted on the regional export

6 markets
6. THE PROJECT
6.1. THE PROJECT SITE
Fortunately, the project site have major advantages in terms of access and closeness to
market, nearness to the raw material source, availability of labor, access to inputs and
services and transportation facility.
The fiber glass container, plastic pet preform and crates production plant will be located in
Amhara Regional state, North Shoe Zone Deber Brehane town about 125 km along with
main road of Addis Ababa to Mekelle.
The project towns is blessed with all infrastructures that are necessary for the project as
well as for work force. The project town has schools, market places, recreation center,
electricity, tap water as well as all the necessary public service. Due to these facts the
Existing location provides a competitive advantage compared to competitors.
6.2. LAND, BUILDING AND CIVIL WORKS
The project is to be located in Amhara Regional state, North Shoe Zone Deber Brehane
town, and land area of 12,000 m2. The location is ideal in terms of its proximity to the Addis
Ababa city. Since the project is located along side road/rail way from Deber Brehan to
Djibouti, it will provide an opportunity for exporting and import its bulk product through
Djibouti port.
Page 33
FIGURE 6-25: Factory layout (12,000 M2)
Scrap recycling, Screen printing 500 M²

500 M² Finished goods store – 2000m2
Office space &

A
Canteen- B
1500m2 4,000m2 – Production floor
C
Road, Parking, loading and unloading space, Garden 2000 M2
]
1500 m2 – Raw material
Guard Post – 500 M2 store
Page 33
The civil work comprises factory building, office building, Guard house, raw material store,
screen printing, scrap recycling, site works and infrastructure facilities. The total
construction cost is estimated at Birr 15.9 million the detail specification is given in table
below.
TABLE 28: COST OF BUILDING AND CONSTRUCTION
Category Total Cost (BIRR)

Main Factory Buildings 11,000,000
Raw material Store Building 990,000
Finished Products store Building 1,650,000
Office and canteen Building 900,000
Guard Tower 220,000
Scrap recycling Building 715,000
Parking, walk ways, roads, loading and unloading space 200,000
Screen printing room 275,000
Grand Total BUILDING & CONSTRUCTION 15,950,000
6.3. PROJECT MACHINERY AND EQUIPMENT REQUIREMENT
Injection molding is a method to obtain molded products by injecting plastic materials

molten by heat into a mold, and then cooling and solidifying them. The method is suitable
for the mass production of products with complicated shapes, and takes a large part in the
area of plastic processing.
A typical injection molding machine is divided into 2 units i.e. a clamping unit and an
injection unit.
 Clamping Unit: The functions of the clamping unit are opening and closing the die,
and the ejection of products. There are 2 types of clamping methods, namely the
toggle type shown in the figure below and the straight-hydraulic type in which a
mold is directly opened and closed with a hydraulic cylinder.
 Injection Unit: The functions of the injection unit are to melt plastic by heat and
then to inject molten plastic into a mould. The screw is rotated to melt plastic
introduced from the hopper and to accumulate molten plastic in front of the screw
Page 33
(called metering). After the required amount of molten plastic is accumulated,

injection process is started. While molten plastic is flowing in a mold, the machine
controls the moving speed of the screw, or injection speed. On the other hand, it
controls dwell pressure after molten plastic fills out cavities. The position of change
from speed control to pressure control is set at the point where either screws
position or injection pressure reaches a certain fixed value.
It is however important to note that all flow speeds, injection speed, shot lead time,
screw rotation speed and other particulars need to be controlled by the machinery
operator. The entrepreneur may also appreciate that the time allowed for the plastic
to cool down also has an effect on the end product properties which requires
considerable know-how and skilled handling of production line processes.
The diagram on the following page gives a cross-sectional view of the injection
molding machine (note: this is just a theoretical representative diagram for the
injection molding machine, as machines may vary according to their makes, brands,
products produced etc.).
FIGURE 6-26: INJECTION MOULDING MACHINES
Total plastic crates manufacturing Equipment, including transportation, Bank charge, and
insurance & installation amounts to be Birr 39.4 million.
Page 33
TABLE 29: COST OF MACHIENRY & EQUIPMENT
Description Quantity Unit cost USD Total cost Total Cost ' Birr
, Set, 'USD
tone
PLASTIC CRATES MACHINES
INJECTION MOULDING MACHINE 3 600,000 13,585,260
200,000.00
PET PERFORM
INJECTION MOULDING M/C WITH CHIILER, 1 67,200 67,200 1,577,339
DEHUMIDIFYING DRYER & OTHER ACCESSORIES
INJECTION MOULDING M/C WITH CHIILER, 1 38,000 38,000 891,947
DEHUMIDIFYING DRYER & OTHER ACCESSORIES
DEHUMIDIFYING DRYER, LOADER & OTHER
ACCESSORIES
DEHUMIDIFYING, LOADER & OTHER ACCESSORIES
DEHUMIDIFYING DRYER, BLOWER & OTHER
ACCESSORIES
DEHUMIDIFYING DRYER, LOADER & OTHER
ACCESSORIES
INJECTION MOULDING M/C DEHUMIDIFYING DRYER, 1 53,700 53,700 1,260,463
BLOWER & OTHER ACCESSORIES
Blow Moulding -
BLOW MOULDING AUTO M/C WITH 4 NOS. 1 192,000 192,000 4,506,682
COMPRESSOR WITH AIR RECEIVER, DRYER, BOOSTER,
COOLING TOWER & OTHER ACCESSORIES
BLOW MOULDING SEMI AUTO M/C WITH 1 28,300 28,300 664,266
COMPRESSOR, DRYER, TANK, 2 CHILLER, STABILIZER &
OTHER ACCESSORIES
BLOW MOULDING SEMI AUTO M/C WITH 1 15,700 15,700 368,515
COMPRESSOR, DRYER, TANK, 2 STABILIZER & OTHER
ACCESSORIES
BLOW MOULDING SEMI AUTO M/C WITH NOS. 1 33,400 33,400 783,975
COMPRESSOR, DRYER, TANK, STABILIZER & OTHER
ACCESSORIES
BLOW MOULDING SEMI AUTO M/CWITH 1 15,600 15,600 366,168
COMPRESSOR & OTHER ACCESSORIES
FIBER GLASS CONTAINER MACHINERS
MOULDS 5 25,000 125,000 2,934,038
HYDRAULIC PRESS MACHINE 1 39,450 39,450 925,982
WELDING 1 40,000 40,000 938,892
BENCH GRINDING 1 20,000 20,000 469,446
LATHE 1 1,500 1,500 35,208
Sub-Total 1,576,250 36,500,093
Auxilary Materials
Generator 1 80,000 1,811,368
Page 33
cooling chiller 1 60,000 1,358,526

Air comperessor 1 70,000 1,584,947
Crusher 1 3,500 79,247
screen printing machine 2 20,000 905,684
scrap washing machine 1 15,000 339,632
Sub Total 1,824,750.0 6,079,404
0
Grand total 42,579,496.73
NO OF CONTAINERS FOR SHIPMENT
5 5
UNIT SHIPMENT FROM COST/ CONTAINER 3,75 0
0 3,750
TOTAL FRIGHT CHARGE 424,539
18,750
PORT HANDLING COST AT DJ/ CONTAINER
1,200
TOTAL PORT HANDLING COST 135,853
6,000
TRANSITOR EXPENSE/ CONTAINER 115
115
TOTAL TRANSITOR EXPENSE 13,019
575
INLAND TRANSPORT FROM DJ TO PROJECT SITE/ 3017.00
CONTAINER 3,017
TOTAL INLAND TRANSPORT 341,556
15,085
TOTAL COST INCLUDING SEA, FREIGHT 43,494,464
INSURANCE (2% of FOB value) 869,889
TOTAL COST INCLUDING SEA, FREIGHT & INSURANCE 44,364,353
& Other costs -
6.4. PROJECT VEHICLES
The prompter intends to purchase vehicles for Raw material Transportation, pickups,
forklift for loading and unloading both finished products as well as raw materials. The total
cost of vehicles is estimated to be Birr 3,100,300.
TABLE 30: PROJECT VEHICLES
Description Quantity Unit Unit Price Total Price in Birr

PICK- UP 1 PCS 738,300 738,300
Fork lift 1 pcs 850,000 850,000
ISUZU 2 PCS 756,000 1,512,000
TOTAL 3,100,300
Page 33
6.5. OFFICE FURNITURE AND EQUIPMENT
To facilitate and speed up the office operation and to maintain motivated employee having
appropriate place of work and office furniture & equipment is inevitable. Beside quality
service and product, having appropriate place of work and office furniture & equipment
will create good image on customers and stakeholders
The company will procure Birr 354 thousand for office furniture and kitchen equipment for
the office & guest house purpose.
6.6. UTILITIES
Electricity and water are the predominant utilities required for any industry. The utilities
required and the corresponding cost is given in the annex.
As stated earlier the plant is going to be established in site that has the necessary
infrastructures like electricity, telephone, water, are available in the factory.
The utilities that are required for the plastic crates industry are water and electric power
and so on.
WATER: The water from the municipalities will service as source of water.
ELECTRICITY: The electricity line is enough for plant operation purpose.
The following table shows that utility consumptions per annum
TABLE 31: UTILITY CONSUMPTIONS
Description Machinery Annual Unit cost Total cost

power installed requirement
(KW)
Elecricity 4,500,000 0.69 3,124,350

Consumption (Kw)
Water (m3/hr) 15,000 11.60 174,000
Total 3,298,350
Page 33
6.7. PROJECT IMPLEMENTATION SCHEDULE
It is estimated that around 24 months required for full operational of the project
implementation. The implementation schedule assumes that an efficient project
management team would be assigned from the very start of operation to implement the
project efficiently. The major activists of the project implementations includes credit
application, building construction, procurement of machinery & equipment, recruitment &
training of manpower and sales of products.
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7 7.PRODUCTION PROCESS
7.1. PRODUCTION PROGRAM

Production program helps the company to achieve uninterrupted flow of materials through
production line by making available the materials at right time and required quantity. The
production program of the plant shows the desire and workable target production level of
the machinery by considering the obvious constraint.
Design of the production system involves planning for the inputs, conversion process and
outputs of production operation. The effective management of capacity is the most
important responsibility of production management. The objective of capacity management
(i.e., planning and control of capacity) is to match the level of operations to the level of
demand.
Parameter like potential product market size, capacity of the plant machinery to be
installed, operational hours and other factors are taken in to account in drawing the
potential plant capacity. Therefore, the following assumption has been used to reach at
plant capacity of the project.
TABLE 32: PROJECT FACT SHEETS
Working days per month 25 Days

Working days 300 per annum
Year 1 3 per day
Number of shifts Year 2 3 per day
> Year 3 3 per day
Working hours 8 per shift

Year 1 12 / annum
Working months Year 2 12 / annum
> Year 3 12 / annum
Page 33
The production line will have capacity of producing 10, 500 pcs plastic crates per day.
7.2. CAPACITY UTILIZATION

Accordingly, it is expected that the plant will initially operate at 70% of its full capacity
during first year in three shift per day and increase production capacity by an annual
growth rate of at least 5% in the following years until achievement of maximum capacity
utilization rate of 90% in the year five. Based on this the total output for consecutive year
presented as follows;
TABLE 33: CAPACITY RATE & PRODUCTION PRGRAM OF THE PROJECTS PER ANNUM
Year 1 70% /capacity

7.3. RAW MATERIAL FOR FIBER CONTAINER

The direct and auxiliary raw materials required by the plan are polyester resin, fiber glass,
and catalyst and accelerator colors. Annual cost of materials is Birr about Birr 14.86
million. All the raw materials have to be imported.
7.4. PET PREFORM RAW MATERIAL & CONSUMABLE

The major raw material of the project are PET resine, PET master batch, HDPE, LDPE,
LLDPE and HDPE / LDPE master batches. The other materials required for the operation of
the project are PP bag and poly sheet.
TABLE 34: RAW MATERIAL REQUIREMENT OF THE COMPANY
Sr. No Raw material type Unit Yearly Consumption

1 PET RESINE KG 3,000,000
2 PET MASTER BATCHE KG 50,400
3 HDPE KG 98,000
4 LDPE KG 196,000
5 LLDPE KG 84,000
6 HDPE / LDPE MASTER BATCHES KG 2,800
7 PP BAG PCS 186,667
Page 33
8 PLOY BAG KG 11,200
7.5. PET RAW MATERIAL

The raw material used in manufacturing of PET Bottles/ Preforms is Polyethylene
Teraphthalate. Polyethylene tetra phthalate is a polymer that is formed by combining two
monomers called modified ethylene glycol and purified teraphthalic acid 3 Master-batch
(Colour concentrate) Raw Material Material is plasticized in the barrel Mixing Raw material
fed into the hopper Clamp the mould at specified load of tonnage Allow the material to cool
for solidification as desired shape tonnage Inject the molten material into the closed mould
at required x speed and pressure Packaging for secondary process Open the mould and
eject the component.
7.6. RAW MATERIAL PLASTIC CRATES

Major raw materials used in making plastic crates are HDPE and Master batch. The
following tables show that the raw material requirement for manufacturing of plastic crates
in the first year.
TABLE 35: MAJOR RAW MATERIALS FOR PLASTIC CRATES
Item Year 1
RAWMATERIAL REQUIREMENT (QTY)

HDPE in Kg 4,716,495
Master batch in gram 94,329,900
7.7. PRODUCTION PROCESS FOR FIBER CONTAINERS

The most popular method for manufacture of large and complex items is hand layup
process. It requires minimum equipment and inexpensive moulds. Moulds are made of
reinforced plastics, plaster of Paris, wood, etc. only one mould, male or female is used and
the articles produced have finish on the side that comes in contact with the mould. Resins
used are of polyester and epoxy. The molding operation is as follows.
 Application of release agent,
 Gel coat,
Page 33
 The layup operation,
 Curing and releasing the mould,
 Trimming, and
 Painting.
7.8. PRODUCTION PROCESS FOR PET BOTTLE

Production of PET Preforms and PET Bottles involves the conversion of PET Granules to
Preforms and later converting to PET Bottles through moulding process. The step wise
production process is explained in the following process flow diagram:
FIGURE 0-27: PET PREFORM PRODUCTION PROCESS
Page 33
7.9. PRODUCTION PROCESS FOR PLASTIC CRATES

The manufacturing process of injection moulded crate is simple in concept. The poly
propylene (HDPE) are fed via a regulated hopper into a homogenous molten mass by
application of heat and shearing actions of continuously rotating extruded screw, which
also keeps pushing the plastic melt forward. The melt gets collected at the forward. The
melt gets collected at the forward end of the extruder cylinder and is pushed into the mould
cavity by the screw, now acting as a hydraulic piston. The mould is kept at pre-specified
temperature and once injected, the plastic melt is held under high pressure to ensure that
the materials reaches all the ends of the mould. In crate moulding, the moulds used have
comparatively very large depth.
The mould is opened after plastic melt has solidified sufficiently and the moulded item is
ejected by means of ejector pins or plates. During the cooling cycle in the mould, the
extruder screw prepares another batch of plastic melt, ready to be injected, and thus the
cycle goes on continuously. The moulded articles usually don’t require any finishing
operation other than removal of wastage.
In general the theory of injection molding can be reduced to four simple individual
steps: Plasticizing, Injection, Chilling, and Ejection. Each of those steps is distinct from the
others and correct control of each is essential to the success of the total process
 PLASTICIZING - describes the conversion of the polymer material from its normal
hard granular form at room temperatures, to the liquid consistency
necessary for injection at its correct melt temperature.
 INJECTION - is the stage during which this melt is introduced into a mold to
completely fill a cavity or cavities.
 CHILLING - is the action of removing heat from the melt to convert it from a liquid
consistency back to its original rigid state. As the material cools, it also shrinks.
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 EJECTION - is the removal of the cooled, molded part from
8 the mold cavity and from any cores or inserts.
 Printing: either the name of the clients or the logos will

print on the plastic crates.
8. ORGANIZATIONAL & MANAGMENT
8.1. ORGANIZATIONAL STRUCTURE
The organization structure shows that the company will undertake corporate management
structure. There are the managerial department of technical, human resource,
administration and finance, operation and marketing departments. There is a legal service,
quality control and management system that assists the manager. The general manager
assisted by the board of directors manages over operation the company.
It is understood that for successful and sustainable plastic crates manufacturing plant
development in general and need to join minds and efforts and put in appropriate place
with modern management as well as market oriented technologies to be effective in the
international market competition.
The organizational structure of the envisaged project depicting the various relationships of
departments and sections is given below.
Page 33
Page 33
FIGURE 8-28: ORGANIZATIONAL STRUCTURE OF THE COMPANY
Board of Directors
Board of Directors
General Manger
General Manger
Internal
Internal Audit
Audit Quality
Quality Assurance
Assurance
Services
Services Services
Services
Human Resource
Human Resource
Technical
Technical Commercial
Commercial Finance
Finance
Administration
Administration
Department
Department Department
Department Department
Department
Department
Personnel
Personnel Marketing
Marketing && General
General
Mechanical
Mechanical Administration &
Administration & Distribution
Distribution accountants
accountants
Maintenance
Maintenance training
training Division
Division Division
Division
Electrical &
Electronics
Electronics General
General Service
Service Cost and Budget
Cost and Budget
Purchasing Division
Purchasing Division
maintenance
maintenance Division
Division Division
Division
division
division
Stores
Stores &
& Material
Material
Management
Management
Addis
Addis Ababa
Ababa Liaison
Liaison
Office
Office
8.2. MANAGEMENT
The availability of managerial staff and skilled labor is a critical factor for success of a
project. A manager or supervisor of any firm should be equipped with the appropriate
qualification & experience for the success of an organization under his supervision.
The General Manager of is Mr. Tibebu Tefera Dessie a wide business, and managerial
experience of more than 10 years. The fiberglass container, plastic pet preform and crates
plant will have its own department manager who will be reporting to the managing director
of the company.
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8.3. AVAILABILITY OF MANPOWER
Even though the core operation of the company require having knowledge, skill and
experience on the part of employees it could be fulfill by having on job training. In addition,
the envisaged factory will located in Deber Brehane where there is potentially enough
manpower. Hence, whether during implementation or operational phases, there would be
abundant unskilled and semi-skilled job seekers in the labor market who will be willing to
join the company. The project has planned to recruits 219 permanent and temporary
workers including management & supervision personnel skilled & unskilled workers when
fully operational.
TABLE 36: STAFFING
Job Title No. of Salary Yearly salary Profession

Employees per month
General Manager 1 35,000 420,000 BA in mechanical
engineering
Secretary 1 3,500 42,000 Diploma in
secretarial science
Total 2 462,000
Production Department
Plant Manger 1 7,000 84,000 BA in mechanical

engineering
Operators 10 4,500 540,000
Assistant Operators 20 3,500 840,000
Technique Head 3 4,500 162,000
Electrician (Technician) 5 3,500 210,000
Laboratory Technician 12 3,000 432,000
Assistant Operators 7 2,000 168,000
Unskilled labour 110 900 1,188,000
Total 168 3,624,000
Administration and personnel Department
Personnel head 1 3,500 42,000 Management B.A

Personnel clerk 7 1,500 126,000 Diploma
Filling Clerk 5 1,500 90,000 Diploma
Guard/ Driver 10 500
Total 23 258,000
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Marketing Study, promotion and Sales manager
Marketing officer 4 3,500 168,000 BA in Marketing or

management
Sales persons 5 2,500 150,000 BA in Marketing or
management
Total 9 318,000
Property Administration and procurement manager
Purchaser 3 4,000 144,000 Diploma or BA in

Purchasing
Delivery supervisor 2 4,000 96,000 Supplies Mgt.
Diploma
Spare parts and supplies store keeper 2 1,500 36,000 Supplies Mgt.
Diploma
7 276,000
Finance Department
Finance Manager 1 6,000 72,000 BA in accounting
Accountants 4 3,000 144,000 BA in accounting
Data entry clerks 5 1,500 90,000 Diploma in

accounting
10 306,000
Total 219 5,244,000
8.4. EMPLOYEE BENEFITS
As part of its initiatives to have a motivated and capable work force at all times, the
company extends to its employees the following employee benefits package starting from
the implementation phase:
Provident fund,
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Medical service,
8 Insurance,
Uniform and safety devices,
Loan facilities depending up on the financial position of the company,
Canteen subsidy, etc.
On top of this, there is a plan to introduce Performance Incentive Scheme for core staff of
the company that undoubtedly benefits both parties in terms of uniting their objectives
towards meeting organizational goals and objectives.
8.5. RECRUITING AND TRAINING PLAN
Once the task of implementation of the expansion project is completed, hiring of technical
personnel shall follow suit based on its pre-designed staffing plan. In the training
dimension, an arrangement is to be made with the supplier of the required machineries and
equipment to train the farm Technical Personnel on the process as well as on machine
utilization during the commissioning process. With respect to other staff, the company
shall allot adequate budget for Capacity Building Programs at the start of operation.
9. FINANCIAL ANLYSIS
9.1. INVESTMENT COSTS
As shown in table below the total investment required for the project is estimated to be
approximately birr 106.2 million. The cost covers initial investment costs, working capital
requirements and pre-operating expenses. Out of the total estimated initial costs, birr
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million will be for civil and construction works, approximately birr 44.3 million for
machinery and equipment, birr 3.1 million will be for motor vehicles , birr 23 million will
be working capital. The rest of the investment cost is allocated for office equipment and
furniture, pre-production expenditure and pre-production interest.
TABLE 37: TOTAL INITIAL INVESTMENT
Description Total
Civil and construction work 15,950,000
Machinery and equipment 44,364,353
Motor Vehicles 3,100,300
Furniture and Fixtures 354,082
Subtotal Fixed investment 63,768,735
Pre operating cost 19,394,828
Total Fixed investment required 83,163,563

Working capital 23,081,861
TOTAL INVESTMENT REQUIRED 106,245,424
9.2. SOURCES OF FINANCE
The sources of finance for the total investment will be equity capital and long-term loan
obtained from Bank loan. The company will capitalize its owners a total of Birr 26.5 million
(25%) and the remaining balance for the envisage project Birr 79.6 million or 75 percent of
total investment will be obtained from loan.
TABLE 38: SOURCE OF FINANCE (DEBT: EQUITY RATIO)
Investment Structure
Capital contribution 26,561,356
Loan 79,684,068
9.3. FEASIBILITY ANALYSIS

INCOME STATEMENT
The projection for the income statement is primarily derived from market based sales
estimates which is based on an adequate market assessment and guaranteed sales from
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previous experiences. The company is expected to generate a net profit of Birr 155 million
in the first year of operation and that will increase to Birr 472 million at the end of the fifth
year.
BALANCE SHEET
The IRR (Internal Rate of Return) of the project for total investment is found to be 60%
with the above economic rate of return, the project is found economically viable and
attractive for investment.
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ANNEX
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Manufacturing Plastic Crates, Fiber Glass Containers & PET Preforms

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Manufacturing Plastic Crates, Fiber Glass Containers & PET Preforms

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PLASTIC CRATES, FIBER GLASS

CONTAINER & PLASTIC PET

2.2.2 RATIONALE FOR THE PROJECT............................................................................................................12

5.1.6. IMPURE AND IMPROPER MUNICIPAL WATER SUPPLIERS.......................................................................40

5.2.1.1. DOMESTIC DEMAND FOR BOTTLED WATER.......................................................................................40

5.2.1.2. DOMSTIC SUPPLY FOR BOTTLD WATER..............................................................................................42

5.2.1.3. DOMESTIC MARKET DEMAND AND SUPPLY GAP...............................................................................46

5.2.2. EDIABLE OIL........................................................................................................................................46

A. DOMESTIC EDIBLE OIL PRODUCTION.................................................................................................46

B. IMPORT OF EDIBLE OIL.......................................................................................................................48

C. TOTAL SUPPLY AND SUPPLY PROJECTIONS.........................................................................................49

D. LOCAL EDIBLE OIL SUPPLY PROJECTION.............................................................................................50

5.2.3. CSD (CARBONATE SOFT DRINK)..........................................................................................................50

A. CSD LOCAL PRODUCTION...................................................................................................................50

C. CSD SUPPLY AND DEMAND GAP.........................................................................................................56

A. JUICE LOCAL PRODUCTION.................................................................................................................57

C. JUICE SUPPLY AND DEMAND GAP......................................................................................................59

5.3. LOCAL PRODUCTION OF FIBER CONTAINER PET-PREFORM BOTTLES AND CAPS.......................................60

3.3.2 SUPPLY OF PET-PREFORM BOTTLES AND CAPS..................................................................................61

5.1. PRICE ANALYSIS...........................................................................................................................................66

5.2 OFFICE FURNITURE AND EQUIPMENT........................................................................................................72

2.1 PRODUCT DESCRIPTION AND RATIONALE FOR INVESTMENT

The plastic crates have the following advantages:

 Considerable reduction in weight and hence easy handling and transportation.

 Convince and ease of handling

 Hygienic and non-toxic

 Space saving-stackable and nest able

 Resistant to chemicals and soaps

 Longer service life as compared to wooden crates.

 Length - 494 mm (external) 466 mm (internal)

B. FIBER GLASS CONTAINER

The PET resin has superior properties, which are as follows:

o Attractive: Products look good, pure and healthy because of attractiveness of

2.2.2 RATIONALE FOR THE PROJECT

etc.…..These sector are growing very fast following the growing

3.1 THE PROMOTER: TIBEBU TEFERA DESSIE

The factory will be managed by a qualified engineers specialized in all aspects of

3.2 BUSINESSES OBJECTIVES

3.3 GENERAL MANAGER: TIBEBU TEFERA DESSIE

The general manager has the following skills:

 Financial management and analytical, fact based decision making

 Strategic thinking and long term visioning

4. PLASTIC CRATES MARKET STUDY

4.2. DEMAND CONSIDERATION

4.2.1. PLASTIC CRATES DEMAND FROM THE BEER MARKET

4.2.2. EXISTING BEER PRODUCTION

FIGURE 1: ETHIOPIA BEER PRODUCTION (HL)

SOURCE: CENTRAL STATISTICS AUTHORITY & OWN COMPUTATION

Object 3 Heineken comes in second with current

FIGURE 2: EXISTING BEER PRODUCTION SHARE (%)

4.2.3. EXPANSION & NEW ENTRANT TO BEER INDUSTRY

Table 1: EXPANSION AND NEW ENTRANT TO BEER INDUSTRY

Total Theoretical Expected year of

4.2.4. PROSPECT OF BEER DEMAND

FIGURE 3: POPULATION PROJECTION

FIGURE 4: GROWING YOUNG POSSIBLE ALCOHOL CONSUMER POPULATION

SOURCE: CSA & OWN COMPUTATION

FIGURE 5: PERCENTAGE OF ALCOHOL CONSUMERS

SOURCE: CSA DHS SURVEY

FIGURE 6: TOTAL ALCOHOL CONSUMERS

SOURCE: CSA & OWN COMPUTATION

FIGURE 7: GDP PER CAPITA PPP USD/ANNUM

SOURCE: WORLD BANK