PLT COLLEGE, INC.

Bayombong, Nueva Vizcaya

Tel. Nos.(078)805-3682, 321-4177, 321-4180
Fax No. 321-2397
E-Mail Address: PLTCol@Hotmail.com

MODULE 10 –PRODUCTION OR TECHNICAL FEASIBILITY

10.1 INTRODUCTION:

This module will present the details of your proposed project’s product/s and/or service/s; how they will be produced

(for manufacturing and industrial projects) or raised (for agribusiness projects) using your own choice of location/s,

building/s and facilities, project capacity, and lay-outing proposals; what will be your specific machineries and
equipment, raw materials, and manpower requirements; and your project's utilities, waste disposal management,

and production system documentation and forms.

Due to the many possibilities of technical terminologies required for certain topics for this chapter/module, all topics

are presented under their common specific heading. You then select only which particular topics, terminologies

and/or instructions apply to your particular project.

10.2 LEARNING OBJECTIVES:

At the end of this module the student will be able to:

1. Identify and describe the intended product
2. Illustrate the production, operation and alternative process/es in the manufacture of the intended product
3. Describe the materials handling design
4. Enumerate the list of offices and specialists to whom the researchers will coordinate with
5. Elaborate the requirements for the Project site
6. Present the Project Lay-out
7. Describe the factors that will affect the plant’s production capacity
8. List down the project’s civil engineering requirements and estimate the relevant costs
9. Present a detailed list of requirements for the project’s floor plan per department
10. Enumerate the details of machineries and equipment needed for the project
11. Present a detailed breakdown of the raw material’s requirements
12. List the details for the manpower requirements
13. Discuss the disposal system, costs necessary and describe all wastes produced by the project as well as
contingency measures
14. Present a breakdown of all projected Production Costs itemized per department/section
15. Demonstrate the project’s technical flow system of operations through a flow chart and craft some sample
designs of production forms.

10.3 LECTURE NOTES:

The following notes and annexes were lifted from the reference book, “A Business Planning Manual” by Jorge H.
Cuyugan

Details:

10.3.1 Product/s (or Service/s)

 Present here, a detailed description of your intended product/s: its dimensions, compositions (mechanical,
chemical and/or physical properties), quality specifications, etc. For agribusiness projects, their common and
scientific names, specie (breed), color, size, weight, etc. For service projects, the specific service you intend to do.

 Present some drawings, pictures, or photocopies of your intended products.

 State any product segmentation proposals, if any.

  State any modifications: differences or improvements of your intended product/s over similar or related products
from your competitors, if any.

10.3.2 Production Process

 State here, the most suitable and practical type or operation process in the manufacture (implementation) of your
intended product/s. for manufacturing projects, Annex 10.1 will be a helpful guide.

 Present your operations Flow Diagram showing the details of each section or activity of your production process
including:

o lead processing time

o materials and/or energy balances (for Chemical related projects, please refer to the Annex 10.2 for a short
review of this topic)
o production or activity flow
o care and management program (for Agribusiness project)

 Present your quality and monitoring standards and schemes (monitoring control systems), if any, Annex 10.3
presents a short review on Production Planning and Control Systems that you can use as your guide.

 State any plans for automation and/or computerization of your project at any period of your study that will
affect your project' budgeting, if any.

10.3.3 Alternative Processes

 State here, alternative production processes that you will use as contingencies in case of sub-normal conditions
operations.

 State the advantages and disadvantages of each alternative.

 State your preparatory plans for implementation of these alternatives in case of application.

10.3.4 Materials Handling Design

 Present your project's Materials Handling Proposal if possible, per department, section or subdivision. A list of
questions that will guide you in the design of your proposal is given in the Annex 10.4

 Prove that your proposed proposal is better than alternatives

 State any costs that will be incurred as a result of your proposal

10.3.5 Technological Assistances

Enumerate a list of offices and specialists whom you will coordinate with, or hire on a retainer's basis who will help you with
external techno-managerial assistances during your operations period. A short list of government offices providing
assistance is given in the Annex10.5. You can present these in the following table:

Name of Office or Address and Tel. No./

Type of Assistance
Specialist Contact Person/s

 Include pro-forma technical assistance contracts, if any.

10.3.6 Project Site

 Present a list of fundamental data and requirements for your project's site determination. A list of factors for
consideration in determining your project site is given in Annex 10.6.

 Describe your project’s proposed location in detail

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  State alternative sites for your project indicating the advantages and disadvantages of each location. Your project's
choice location should prove to be the best alternative in this case.

 State also some possible obstacles that you may encounter in your choice of project location, and how you are
going to solve each.

 For multi-plant location, prove the necessity of each project/plant site,

 State the current cost of real estate in the vicinity of your project site.

 State allocations for future expansion of your project.

 Present current site conditions and preparations and developmental requirements, if any and all other costs you
may need during your pre-operating period. You may use the suggested format presented as follows:

COST ESTIMATES OF SITE ACQUISITION AND PREPARATION

SOURCE OF FUNDING
ITEMS LOCAL FOREIGN TOTAL
DESCRIPTION QTY.
AMOUNT AMOUNT
Land
Legal Expenses
Right of Way
Tenant’s Rights
etc.

10.3.7 Project Layout

 Determine data and alternatives in making your choices for coming up with your project’s layout Annex 10.7
presents checklist of questions that you may consider in determining your best choice.

 From among your suggested layouts, decide and select your best proposal and state your reasons for choosing
it.

 In case of franchises or subsidiaries where project layouts on normally dictated by Head Offices, present your
detailed project layout as directed and suited to your site's area dimensions.

 Show your choice layout's detailed drawings drawn to scale.

 State provisions for any underground facilities and non-operational parts layouts (canteens, display room, etc.)
project.

 Present the detailed costs of lay-outing your project.

10.3.8 Plant Size and Production Schedule

 For your Plant Size Capacity Proposal:

o Describe the factors that will affect your plant production capacity. Annex 10.8 lists some these topics for your
consideration.

o State all possible alternatives including minimum, normal and maximum limits to your proposal plants capacity.
Present advantages and disadvantages of each.

o From the above list, select the most favorable choice by department or sections for each semi-finished products
and your plant’s capacity. State your reasons/s for choosing it.

o If possible, present your project’s capacities by departments or sections for each semi-finished product or and of
your entire operations.

o Present your projected annual plant capacities for the next five or ten years. You may use the suggested format
below:

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 Product/s Year Year
Department 100% 0 1 …
By Units
section Cap. Total
Product/s Qty. Qty. …

 For your Production Schedule Proposal:

Department/ Manpower
Shift
Section Description time Requirement ... etc.

 Present your reason for coming in with the figures in the above table.

 Relate some possible changes in your schedule to suit your project’s capacities during sub-normal and super-
normal operations. State also the quantities (increases or decreases) in your plant capacities during these periods.

 Present any alternative production schedules during off-season, and lean or peak months if you have a “seasonal”
project.

 If possible, present schedules for pre-operating or dry runs of your project for seasonal or cyclic operations if
these are warranted.

10.3.9 Building & Facilities

 List down projects’ civil engineering requirements for both building and non-building facilitate. A checklist of
factors in coming up with a sound engineering proposal of this topic is given an Annex 10.9.

 List alternative or contingency facilities you may need for your project

 Estimate your project’s civil engineering costs. You may use table below as your presentation guide:

Description Unit Quantity Cost and Sources Total

Local Foreign

 Present a detailed drawing of each of your structures drawn to scale.

 State the quality of construction materials you will need for each structures of your projects. In case of construction
materials not readily available within the locality of your project, state their sources and other additional costs you
will incur in their purchases.

 State allowances of buildings and facilities you will need for future expansion of your projects.

10.3.10 Floor Plan

 Present a detailed list of requirements of each of your project’s floor plan per department/section.

 Describe in detail, your projects floor plan layout for each department/section. Include your reasons for your
proposals. In coming up with your designs, be sure to take into consideration the following flows:
o functional flows
o quantity flows

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 o transportation flows
o manpower flows
o materials flows
o production flows
o utility flows
o communication flows

 Present alternative flow plans, for possible consideration during sub-normal and super-normal operations during
your operations period. State your reasons for coming up with your proposals.

 If possible, include a detailed drawing for each of your plans.

10.3.11 Machineries and Equipment

 Present a detailed list of machineries and equipment you will need for your project. If possible, under the following
sub-headings:
o plant (process) equipment and machineries
o mechanical machineries and equipment
o electrical equipment
o process instrumentation and control machineries and equipment
o auxiliary machineries and equipment
o tools and spare parts

Annex 10.10 presents a list that could be useful on this topic.

You may present these items in the following table:
Sub-Heading Description and Uses Sources Unit Cost Quantity Total

Note: You can subdivide the last columns of this table into local and foreign sources if necessary.

 Present the terms and conditions of sale from suppliers of each of the machineries and equipment you intend to
purchase.

 Insert some brochures and/or drawing for each of your machineries and equipment requirements.
 Present a time schedule of your purchases for any new or additional machinery or equipment you may need
during your projection period. State their detailed description and specifications if they have not yet been
described.

 State alternative machineries and equipment you will need in case of sudden breakdown, unavailability of choice
machineries and equipment, etc.

 Present your Machineries and Equipment Layout Design as suited from the preceding topic.

10.3.12 Utilities

 Present a detailed breakdown of the utilities that will be needed for your project. Annex 10.11 contains a list of
some factors for consideration on this topic. You may use the suggested table below for your presentation:

Consumption
Utility Description Sources Unit Cost Total
Rate

 Present a breakdown of the cost of each utility for the next five or ten years. The table given below could be
used for your presentation:

Utility Year 0 Year 1 Year 2 … Year n

5
  Present on explanation of any increase or decrease in projected values, if any.

 State substitutes or alternative sources of each or all of your utilities in case of sudden or temporary unavailability.

10.3.13 Raw Materials Requirements

 Present a detailed breakdown of your project’s raw materials requirements. For your presentation, you could use
the table below:
Raw Qty.
Department/Section Description Unit Cost Total Cost Source/s
Materials Needed

A list characteristics of raw materials is presented I Annex 10.12 for your reference.
 Present some leaflets or brochures of each these items, if available.

 State alternative or substitute raw materials you may use during lean, peak or emergency months in case of sudden
or temporary unavailability of any all of your raw materials requirements, and their source/s.

 Present your total raw materials requirements purchases for the next five or ten years, you may write these
projected figures using the tabular format below:

Raw
Department/Section Year 0 Year 1 … Year n
Materials

 Present an explanation of any increase or decrease in values of the items in the table above during your projection
years.

 State the terms and conditions of purchase, payment and delivery of each of your raw materials requirements,
including their availability from your supplier/s.

10.3.14 Manpower Requirement

 Present your personal requirement and organizational layout per department/section of your project. State the
reasons for your proposal.

 State the skills and levels of training qualifications of your direct personnel per department/section

 Present the different job functions and responsibilities of your direct personnel per department/section.

 State your direct personnel’s Skills Development Program.

 State your direct personnel’s workloads, number of hours per shift, shifts, per department/section, and all benefits
due them.

 Present your direct personnel’s labor costs per department/section. The table below could be used for your
presentation:

Department/ RATE Total

Position No.
Section Basic Benefits

 State increases and decreases in your man power requirements over your projection years. State also your reasons
for the changes.

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  State alternative manpower schemes for seasonal or sub-normal/super-normal periods.
 Present your direct labor costs for your entire projection years. You can use the tabular format below for this item.

Department/ Year 1 Year 2 … Total

Position
Section Qty. Amt. Qty. Amt. …

 State your reasons for any increase or decrease in the figures of the above table.

10.3.15 Wastes and Waste Disposal Method/s

 Describe all wastes produce by your plant/project in detail and their effects to your operations. If possible, include
their quantity, schedule of emissions, etc.

 State your means of disposal system: your waste treatment machineries and equipment; and waste disposal sites,
treatment plants, recovery plants, and treatment equipment and facilities, if any.

 State all costs your project will require including designing and operating your waste disposal method,
compensation to neighbors, government duties and/or penalties, etc. Compute these over your projection years.
You can follow the table below for your presentation:

Type/Total Cost Year 1 Year 2 … Year n

 Come up with a contingency program for sudden increases of waste and/or sudden temporary or permanent
unavailability of your waste disposal methods or facilities. Include all corresponding costs as a result.

10.3.16 Total Production Costs

 Present a breakdown of all your projected Production Costs itemized per department/section as summarized from
all your past topics. You could use the table below for this item:

Department/Section ITEM Year 1 Year 2 … Year n

A Raw Materials
…
…
Direct Labor
…
…
Overhead
…
…
B Raw Materials
…
…
Direct Labor
…
…
Overhead
…
…
TOTALS Raw Materials
Direct Labor
Overhead

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6.17 System and Forms Design

 State your project’s technical flow of operations and standard operating procedures, clearly showing internal and
external relationships to other parts of your entire organizations. State also an explanation of your proposed
system.
 Present your project’s flow chart illustrating your proposed system of technical operations.

 Present some sample designs of production forms you will use in the operations of your project. If possible, state
also their description, use(s), channel’s, who and how will they be accomplished. Please refer to Annex 10.13 for a
short list of these Forms.

At this point, you have taken into consideration, your project’s three major aspects: Management and
Personnel (Administrative), Marketing, and Production. All of these aspects entail their corresponding
costs for your project. If all of these are feasible and consistent with each other (otherwise, do not
hesitate to make the necessary modifications again), you can now go to the next Chapter: your
Financing Aspect.

10.4 FOCUS QUESTION/STATEMENT

Having pointed out the hereinbelow annexes as guide, you are ready to prepare and draft the Technical Feasibility
part of your study.

10.5 ACTIVITY

At the end of this module, discuss among your group members how you will apply the above guidelines to start
writing the first draft of the Technical Feasibility following the outline given.

10.6 ASSIGNMENT

Again, the leader should initiate the assignment of different task to group members according to the sub-areas
presented. Members should provide the write-up/data/tables/information per area assigned.

The task assignment must be uploaded to the portal backed up by relevant researches and evidences.

10.7 ASSESSMENT/EVALUATION

A rubric will be used in grading the output of the individual members. The highest point that will be earned by
each member is 20 points.

10.8 REFERENCE

A Business Planning Manual by Jorge H. Cuyugan (for the Lecture Notes)

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Annex 10.1 Types of Operation Processes and Design Symbols

This Annex is a refresher course of the different types of manufacturing processes. These are:

A. Intermittent Manufacturing. The type of production where one produces a product for only a limited period and
which product will reappear in the schedule after some time. Examples of companies that require intermittent
manufacturing processes are those that produce products on a cyclical, non-standard (e.g. made-to-order
products), and standard products produced during off-seasons.

B. Continuous Manufacturing. This is the type of production where a product is produced continuously, or for a
specified long period of time. Companies that use this type of manufacturing process are those that “mass-
produce” their products in quantity (volume) outputs.

In presenting your project’s production flow, the following Production Process Design Symbols are used:

ACTIVITY SYMBOL DEFINITION/ACTION

Operations ● Change
Transportation Move
Inspection ■ Check
Storage ▲or ▼ Keep
Delay Wait

An illustrative example for a multi-product design is presented here.

PRODUCTION FLOW PROCESS CHART:

▲ RAW MATERIALS STOCK

TILES WITH STAMPS POTS WITH DECORATIVE FLOWER
A B C POTS IN ANTIQUE FINISH D
MOSAIC DESIGNS
● unload purchased tiles ● unload purchased pots ● unload purchased pots
to cleaning section
to cleaning section to cleaning section

● cleaning and sanding ● cleaning and sanding ● cleaning and sanding

■ quality inspection ■ quality inspection ■ quality inspection

● painting of sides ● painting ● painting P

R
drying drying drying O
pasting of stamps on rubbing and polishing with rubbing and polishing with C
● ● ●
tiles sandpaper sandpaper E
S
drying ● designing of pots ● designing of pots
S
● plastic lamination ● varnishing ● varnishing I
N
pasting of felt paper G
● drying drying

■ quality inspection ● pasting of decorative flowers ■ quality inspection

To final assembly plant drying To final assembly plant

■ quality inspection

To final assembly plant

▲ FINISHED PRODUCTS STOCK

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Annex 10.2 Materials and Energy Balance

This Annex is review on how to compute and present a materials and energy balance flow chart. Simply stated, a material and
energy balance is a graphical representation of the inflows and outflows of materials (in units) and/or energy per activity per
machine.

An example of a materials and energy balance flow chart is given below:

Consider a plastic bag-manufacturing plant equipped with the following machineries and their % efficiencies. The project’s
materials and energy balance flow chart is given as:

Raw Materials Inputs:

(plastic resins)
864.00 kgs.

820.80
Extruders kgs Surface Treating Machines

(95 % efficiency) (100 % efficiency)

820.80
Kgs.

60% capacity
60% kgs./day rated capacity
8 hrs./shift Cooling Tower
3 shift/day (100% efficiency)

820.80
779.76 Kgs
kgs.
Output:
Plastic Printing Machine Sealers, Cutters
Bags (95% efficiency) (95% efficiency)

For agribusiness projects, the machineries and equipment in this example may become pens, cages or ponds where the
mortality rate is used lieu of the % efficiency.

Page 10 of 21
Annex 10.3 Production Planning and Control System

This Annex is a review of how to present your project’s production and monitoring program.

Production Planning and Control, or PPC enables you to carefully prepare (plan) your project’s manufacturing (production)
operations in coming up with your desired product’s, at the right time, and at the least cost m- and implementing these
decision according to your company’s goals and specific standards.

In preparing your PPC, you must consider all your production aspect’s topics. Among those to be considered are your project’s:

 inputs/outputs
 operations process/es and measurements
 schedules and capacities
 work environment/opportunities
 production standards
 manpower (human factors)
 materials inventory and management
 quality controls and assurances
 costs
 forecast
 information feedback and monitoring systems
 economics of your operations and systems
 machineries and maintenance

E. S. Buffa illustrated a project’s operations’ Planning and System in the figure presented on the next page:

Environmental factors
Forecasts affecting demand

Broad-level aggregate plans setting Information Feedback on the progress outputs,

sales, etc.
short-term capabilities

Detailed plans and schedules:

Man power-hire, layoff, overtime, manpower
schedules, equipment schedules, raw
materials and inventories

Productive process

Inputs:
labor, Outputs of goods and services
materials, Monitor quality, quantities and cost
equipment,
energy of outputs

Re-adjust processes to conform Interpret Standards for quality, quantity

to standards results
and costs

Broad-level control
system

Page 11 of 21
Annex 10.4 A List of Questions to Guide You in the Design of Your Project’s Material Handling System

This Annex contains a list of questions for you to consider in designing your project’s materials handling system. These
questions are:

 Is your inventory delivered on time, and does your storage arrangement needs vertical or horizontal racks, cabinets,

etc.?
 Will be it all right to deliver incoming materials direct to the work areas?

 Will be the deliveries of your materials come in single trips, or several trips?
 Are your processes requiring heavy materials placed near your receiving areas?

 Do you need conveyors to handle the flow of your materials?

 Is your materials flow system a single-line flow only, or does it need several flows or backtrackings?
 Why not use “gravity” for your materials flow if it is possible, and will this be practical or convenient?

 Are all your manual handling operations minimized?

 Will it be more economical for you to enter into sub-assemblies, or into sub-contracting?
 Does your materials handling system conserve space?

 Do your pathways get easily clogged-up as a result of your proposed operations flow system?

 Are your conveyors, machineries, equipment and facilities checked for safety?
 If there are separated work areas, are they placed “within reach” of adjacent or work-related areas?

 Do you have a contingency plan for your materials handling system in case of emergencies?
 Are your products that are finished by one operator or department/section easily picked by the next?

 What have you done to minimize delays and bottlenecks?

 Is flow easily accessible to inspectors?

 Have you determined vital inspection points in your work areas?

 Does your sub-assembled products need storage “in-between” operations?

 Are your transport containers designed to have the maximum speed of delivery to their next
operations/departments/sections?

 If you use lift trucks or other heavy materials, are they operated at the desired efficiency rate?
 Does each of your materials handling proposals fit perfectly into your whole system?

 Does your system reduces the incidence of walking and results in higher efficiency and quality of your products?

Page 12 of 21
Annex 10.5 A Short List of Techno-Managerial (Production) Bodies

This Annex contains a short list of government bodies where you could get some valuable technical information for your project

study. Most of these agencies have Regional and Provincial offices within your reach:

1. Bureau of Animal Industry

2. Bureau of Fisheries and Aquatic Resources

3. Bureau of Plant Industry

4. Bureau of Mines and Geo-Sciences

5. Department of Agriculture

6. Department of Environment and Natural Resources

7. Department of Science and Technology

8. Department of Trade and Industry

9. Food and Nutrition Research Institute

10. Footwear and Leather goods Industry Center

11. Forest Management Bureau

12. Forest Products Research and Development Institute

13. Metals Industry Research and Development Center

14. Philippine Textile Research Institute

15. Product Development and Design Center of the Philippines

16. Technology and Livelihood Research Center

17. UP-Institute for Small Scale Industries

Page 13 of 21
Annex 10.6 Some Factors to Consider in determining your Project’s Site

Below is a list of things to consider in determining your project’s site for different factors:

A. On Climate:

 air temperature(minimum, maximum, average)

 humidity(minimum, maximum, average)
 sunshine(duration, per season)
 wind (direction, minimum, maximum, average)
 rainfall(duration, per season)
 dust and fumes(for neighbouring plants, environment)
 extremities: floods(average, height, season), earthquakes(frequency, magnitude) etc.

B. On Site and Terrain:

 address
 neighbors
 heights(above and below sea level)
 geographical orientations
 environmental orientations
 existing rights of way(roads, power, water, etc.)
 prices of adjacent real estate

C. On Transportation and Facilities

 roads and bridges (width, length, bearing capacity, types, closed down for repairs, network, maps, etc.)
 railways (networks, maps, gauge, profile, capacity, loading and unloading facilities, warehouses and storage,
tariffs, etc.)
 air transport (types of loading place/s, length of runways, warehouses and storage, tariffs, fares, etc.)
 passenger transport system (buses, jeepneys, taxis, shuttles, etc.)

D. On Fiscal and Legal Regulations:

 fiscal regulations (taxes, customs, depreciation rates, etc.)

 legal regulations building, legislations, restrictions, zoning, safety regulations, compensation laws, standards, etc.)
 insurance (fire, accident, liability, flood and storm damage, etc.)
 “the ability to maintain on-the-site medical facilities”

E. Other Factors:

 proximity to raw materials and inputs sources, markets, and other important centers necessary for your project’s
operations
 development and utilities plan of the local government
 national programs
 centers and institutions

Page 14 of 21
Annex 10.7 A List of Questions to Guide You in the Design of Your Project Layout

This Annex contains a list of questions that will guide you in coming up with the design of project’s layout. These are:

A. On Production and Production Control:

 Would your work area’s conditions reflect higher quality of work?
 Do you fully utilize your floor space?
 Are your machineries and layout proposal practical and can they attain full utilization of your machineries?
 Are your machineries readily accessible for input deliveries and repair and maintenance work?
 Can operators work on two or more equipment in practically the same place?
 Is the design of your pathways free from obstacles and traffic?
 Do you need color schemes for your different work areas?
 Is there enough space in your work areas to affect a comfortable condition on work?
 Are your machineries and equipment placed in such a way as they maximize your worker’s motion during operations?
 Do you have tools cribs near machineries to easily get them when needed?
 Have you allowed for departmental expansion?
 Is your machine flow cycle adaptable to changes and does fit perfectly in your layout?
 Can supervisors easily see the entire work process in the departments/sections of the entire plant?
 Does the arrangement of your machines allow for maximum flexibility?
 Have you allotted space for your department’s (or section’s) supervisors?
 Have you assigned a smoking area in your plant?
 Does your layout’s repair and maintenance activities interfere with the production flow?
 Do you have service control area?
 Are they (service control area) accessible?
 Have your cleared fire and hazard exit areas in your plant?
 Does your layout minimize your plant’s noise pollution?
 Even in isolated areas in your plant, are there any hazardous operations?

B. On Your Buildings/s and Surroundings:

 Are your floors overload, or do they need reinforcements and/or additional space?
 Are electrical outlets placed near machineries for your operators to easily connect/disconnect power lines?
 Are all your exits properly located?
 Have you provided drinking water facilities in accessible areas?
 Could you utilize artificial illumination?
 Has it (artificial illumination) been used to its maximum advantage?
 Is your ventilation highly adequate in all your work areas?
 Do you have provisions for cooling and/or air conditioning?
 Is your building layout designed to facilitate and accommodate your proposed wok process/es?
 Are your pathways wide enough to accommodate passersby?
 Are your loading and unloading areas covered against harsh weather?
 Do you ample parking space?
 Could you easily transfer fire equipment from each or all parts of the plant?
 Would you use dividers rather than walls to separate your plant’s different departments/sections and offices?

C. On Product Design:

 In case of product changes, do you need a change of your layout, machineries and equipment, etc.?
 Could you install new/additional machineries and/or equipment without interfering with the current production
operations?

D. On Service Areas and Employees’ Comfort:

 Are your service areas accessible to all parts of your plant?

 Have you provided lockers, drinking fountains, etc. for all your workers?
 Have you provided for your plant’s ventilation, lighting and heating requirements?
 Have you carefully marked and isolated danger areas within your plant?
 Have you provided for first aid stations for each department/section of your entire plant?
 Have you provided adequate storage spaces or areas for flammable and/or toxic materials?
 Have you provided for recreational facilities to your employees?

Page 15 of 21
Annex 10.8 Some Topics for Consideration in Determining Your Plant’s Capacity

When you arrived at your marketing feasibility’s projected sales, you look into consideration the projected selling price/s of
your products/s multiplied by their corresponding projected production outputs. This means that, from the latter, you have
already determined your projected plant capacities.

This Annex contains some useful considerations that will help you review your projected capacities. These include your:

 installed equipment and technical conditions of your plant;

 budget constraints (investments and production costs);
 technical conditions: stoppage, downtimes, holidays, maintenance, tools and machinery changes, shift changes,
management style to applied, etc.;
 minimum economic capacity and initial planned capacities;
 available technological process/es;
 equipment constraints;
 resources and input constraints;
 break-even capacities and profit goals;
 dependability of figures and forecasts;
 effect of external (environmental) factors such as inflation, foreign exchange, etc.

Other than these, you should also take into consideration, your project’s type of manufacturing process/es, production
output/s, on whether your project entails single or mixed products, and the type of raw materials it needs (raw or semi-
processed), etc. – all of which must be blended to create a single decision most suitable for your project.

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Annex 10.9 Some Factors for Consideration for Your Project’s Civil Engineering Works

In this Annex, you may try considering the following factors needed in coming up with a sound engineering works:

A. Of Cost of Site Preparations and Improvements:

 relocation of existing structures, if any

 demolition or removal of existing structures, if any
 wrecking
 grubbing
 site grading, tiling, cutting and filling
 drainage and reclamation
 diversion of streams, roads (paths), etc.
 points of tie-in of utilities, electricity, water, communications, roads, railways, etc.
 other site preparation and development works

B. Of Buildings and Civil Works

 For buildings and structures: installation, construction, excavation, bricklaying, concrete and reinforced concrete
works, waterproofing, masonry, structural steel roofing, cladding, steel-sheet works, carpentry, etc.
 For structural finishing: masonry, carpentry, steel works, plastering, joinery, glazing, waterproofing, caulking, ceramic
tiling, flooring, parquetry, paving, wallpapering, painting, etc.
 For technical installations: heating, ventilation, air-conditioning, plumbing, gas, power, etc.
 For special engineering works: pile foundations, slurry trench walls, walls, soil consolidation, drainage, ground water
table lowering, steel sheet-piling, ramps chimney (stacks), foundations for heavy machineries and equipment, etc.
 Also: generating plans for steam, hot and/or cold water, high and/or low-tension currents, emergency power plants,
storage tanks for fuel/gasoline/water/etc., filling stations, telephone central units (for inter-communications),
firefighting, a compressed air center, elevators, kitchen, laundries, laboratories, etc.

C. Of Classification of Outdoor Works (Non-factory)

 utility supplies
 emissions handling and treatment including sewage systems, oil-gas separators, conveyors, pumping stations,
treatment plants, waste storage boxes or drums, refuse burning plants (incinerators), or other
 traffic installations, parking areas, railway tracks, sheds, outdoor lightings, etc.
 landscaping
 fencing
 supervision and plant security installations

D. Of Items for Agribusiness Projects:

 cages/pens: their sizes, dimensions, color, made, quantity. costs, etc.

 utility connections: power, water, quality, quantity, costs
 waste disposal system items: sewage, dumps, etc.
 fencing and security supervision
 staff quarters, welfare facilities, etc.
 storage houses, garages, research and control laboratory, medical and service facilities, etc.
 Transport facilities

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Annex 10.10 A List of Machineries and Equipment for Possible Consideration per Classification

This Annex contains a short rundown of possible items to consider for your project’s machineries and equipment’s
requirements. These are:

A. Production Equipment:

 plant (process) equipment

 technical equipment
 electrical equipment
 instrumentation and control equipment
 process conveyors and transport equipment
 other plant machineries and equipment

B. Auxiliary Equipment:

 transport: cars, buses, trucks, tank-trucks, forklifts, railway equipment, water transport, ropeways, etc.
 utility supplies: electric power equipment, water supply equipment, gas supply equipment, etc.
 generating plants for: electiricyt, steam, hot and cold water, compressed air, etc.
 emergency power: stand-by batteries, generators, etc.
 workshop equipment
 laboratory equipment
 storage and warehouse equipment
 inter-communications equipment
 heating, ventilation and air conditioning equipment
 packaging equipment: mechanical saws, nailing machines, drums, containers, etc.
 sewage disposal and treatment equipment
 waste disposal and treatment equipment
 other auxiliary equipment

C. Service Equipment:

 office equipment: computational machines, reproduction machines, furniture, lockers, writing equipment, etc.
 canteen equipment
 medical service equipment
 plant security equipment: fire protection devices, alarms, etc.
 plant yard cleaning and trimming equipment: mechanical polishers, brooms, cutters, lawn mowers, etc.
 staff welfare equipment
 other service equipment

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Annex 10.11 A Breakdown of Utilities and Some Factors for their Consideration

This Annex contains some factors for consideration in designing your projects’ utilities. These are:

A. On Your Water Supply:

 Characteristics (not referring to specific uses):

o dissolved water content: hardness, corrosiveness, gases
o suspended matter
o temperature: maximum and minimum, over one day, over a year, etc.
o pressure: maximum and minimum
 Sources:
o from public utilities: maximum quantity, place of connections (piping), diameter and material of existing networks,
pressure, prices
o from private utilities: surface supplies (e.g. rivers), subsurface supplies (e.g. groundwater), reclaimed effluents,
costs
o water table studies: pumping tests, riparian rights and easements, allotments in conservation areas, impounding
for leveling of availability, treatment of effluents for recovery
o methods of treatment: removal of suspended and dissolved matters, biological treatments of effluents

B. On Your Power Supply:

 Electricity from public of private utilities:

o available power
o voltage (high, low)
o tie-in points (distance to site)
o price (including tariffs)
 Fuel oil and gas oil:
o available quantity
o quality (kj/kg)
o sources (filling stations, refineries, etc.)
o distance to site (include transportation utilities)
 Coal, coke and gas:
o available quantity
o quality (kj/kg)
o source/s
o price
 Steam:
o quantity available
o pressure
o points of tie-in (connections to site)
o price

C. On Your Communication Systems:

 Telephones
o hand-operated/automatic
o capacity
o point of tie-in
o tariffs
o price
 Telexes
 Wireless:
o FAX
o Computers (internets, etc.)

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Annex 10.12 A List of Characteristics for Your Raw Materials Inputs

This Annex contains a listing of details you could present together with your project’s raw materials’ input requirements. These
are qualitative:

1. Physical Properties:
o size, dimensions, form, etc.
o density, viscosity and porosity
o state (solid, liquid, gaseous)
o melting and boiling points

2. Mechanical Properties:
o formability and machinability
o tensile strength, compressive and sheeting strengths
o elasticity, stiffness and fatigue resistance
o hardness and anneal

3. Chemical Properties:
o form (emulsion, suspension, etc.)
o composition (elements, compounds)
o purity
o oxidizing and reducing potentials
o flammability and self-extinguishing properties

4. Electrical and Magnetic Properties:

o magnetization
o resistance and conductance
o dielectric constants

For agribusiness projects, aside from the qualitative properties stated above, you could add:

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Annex 10.13 A List of Some Production Operations Forms and Records

From among the following list, select which are applicable to your project and design them to suit your project’s needs. Of
course, additional forms and records may be thought of and proposed. Samples obtained from an organization of a related
business nature could be used as guides.

1) Operations or Routing Sheets, used to determine your company’s factor of production requirements.

2) Bill of Materials, lists all components parts of an assembly i.e., the quantity requirements for each nit of the assembly,
and the source of each part.

3) Manufacturing Requisition Slip, identifies the item/s to be produced and stipulates the quantities needed to be
replenished.

4) Master Schedule Sheet (or Chart), contains a listing of time frames for each operational activity in producing a certain
product or products.

5) Inventory Slips or Records, used to determine your stocks of inventories.

6) Assembly Order Slips, contain an enumeration of the different parts required in an assembly and the total quantities
of materials needed.

7) Machine Load Charts, contain a list of the operational details and requirements (capacity, use and schedule) of each
of your machineries and equipment.

8) Operation Schedule Sheets, contain a detailed schedule of your operations, activities, and product requirements.

9) Shop Forms, provide an authorization and instructions to the department/section personnel. These include:

Job Orders
Move Order Slips
Materials Requisition Slips
Finished Parts Requisition Slips
Machineries and Accessories Requisitions Slips
Inspection Reports
Scrap Reports
Gantt Charts
Progress Report Forms

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