ALOE VERA
CULTIVATION
AND JUICE
Barbadensis (aloe Vera)
ALOE VERA CULTIVATION AND JUICE
1 EXECUTIVE SUMMARY
Aloe vera Plant is widely cultivated in the world due to its immense health benefits thus;
this business project aims at cultivation of aloe Vera (Barbadensis) and Juice for
commercialization in Bhutan.
The aloe Vera cultivation and production of juice will be carried out in Wangduephodrang
Rubesa Gewog and the reason for choosing Wangduephodrang is mainly because this place
achieves the standard needed for cultivation of aloe Vera Leaf(less rain, high temperature
and availability of cactus which indicates aloe can be grown since they share similar
characteristics). The proponent at the initial stage has to plant 10000 aloe seedlings in two
acre land and lease 20 decimal of land for the construction of aloe juice production house.
The product will be distributed in Bhutan especially in Traditional medicinal houses (Bio
Bhutan, Menjong Zorig pharmaceuticals), small pharmaceuticals, resorts and handicrafts.
FUNDING FROM BOIC- If the proponent chooses to avail loan from BOIC then he has to
avail BTN 1,718,023 as an 80% loan and inject 20% equity of BTN 429,506 to realize its
establishment of the production centre. The initial investment of the proposed business is
BTN 2,147,529 which comprises of the startup cost of BTN 1,988,549 and working capital
of BTN 158,980.
FUNDING FROM FINANCIAL INSTITUTIONS- if the proponent chooses financial institutions
for funding support then he/she has to avail 70% loan of BTN 1,509,570 and 30% equity of
BTN 646,959 with the total project cost of BTN 2,156,529.
The project will employ thirteen people including the promoter who will spearhead the
enterprise in the capacity of a manager. This would provide employment opportunities and
contribute towards the livelihood improvement of the people in the community. Aloe Vera
Juice making machines will be purchased from India (Om Shakti fabricators), aloe leaf
seedling from Kerala (Kerala Agriculture University).
In the initial year the business will not have production of juice since gestation period of
aloe Vera is maximum one year. From second year business has production of 81,480 litres
of Aloe which will be categorized into 250 ml, 500ml and 1000ml.The business will
increase its yearly total sales (on an average) by 5%. By the end of fifth financial year
production of aloe juice will account to 94,323 litres which will be worth BTN 5,120,407.
Besides its healthy financial standing due to its strategic investment and management plan,
the proponent also enjoys healthy liquidity with the payback period of three years and four
months, net present value (NPV) of BTN 850,828 and an internal rate of return (IRR) of
18%. The business can achieve its breakeven point at 89193units by three years from the
time of production with an increment of 20000 units. This is a stage where forecasted
revenue exactly meets the total cost, where loss ends and profit accumulates. This is a point
Aloe vera Juice
Page 1
ALOE VERA CULTIVATION AND JUICE
where business becomes financially viable. ROI (Return on investment) from the Aloe Vera
Juice production are 106%, 116%, 127% and 138% there is an increasing trend in ROI
which certifies that the money invested by the proponent has a positive return. This can be
achieved if the proponent chooses BOIC for funding support.
If the proponent chooses financial institutions then he/she enjoys healthy liquidity
with payback period of three years and six months with NPV of BTN 639,385 and IRR of
16%. The business can achieve its breakeven point at 10, 0443 units by three years from
the time of production with an increment of 20000 units. This is a stage where forecasted
revenue exactly meets the total cost, where loss ends and profit accumulates. This is a point
where business becomes financially viable. ROI( Return on investment) from the Aloe Vera
Juice production are 105%, 115%, 126% and 137% there is a increasing trend in ROI
which certifies that the money invested by the proponent has a positive return however
ROI for first year is zero since there is no sale of aloe juice since its gestation period is for
one year.
The bottom line is that if the proponent wants to choose BOIC for financial support it
enjoys less interest rate on the loan availed thus, business will be more profitable.
However, if the proponent wants to choose financial institutions for funding support the
proponent has to pay more interest which results in decrease in business revenue thus,
availing fund from BOIC would be wiser decision but aiding fund from financial institutions
is also profitable.
Aloe vera Juice
Page 2
ALOE VERA CULTIVATION AND JUICE
1
CONTENTS
EXECUTIVE SUMMARY ................................................................................................................................. 1
2
VISION .................................................................................................................................................................. 5
3
MISSION ............................................................................................................................................................... 5
4
THE BUSINESS PROFILE .............................................................................................................................. 5
5
BUSINESS BACKGROUND ............................................................................................................................ 6
6
KEYS TO SUCCESS ........................................................................................................................................... 6
6.1
Proper Inspection from BOIC ............................................................................................................ 6
6.2
Four percent Loan .................................................................................................................................. 7
6.3
LOCATION OF THE BUSINESS ........................................................................................................... 7
6.4
Aloe Vera –Herbal plant. ...................................................................................................................... 7
7
SWOT ANALYSIS .............................................................................................................................................. 8
7.1
STRENGTH ................................................................................................................................................. 8
7.2
WEAKNESS ................................................................................................................................................ 8
7.3
OPPORTUNITY ......................................................................................................................................... 8
7.4
THREAT....................................................................................................................................................... 8
8
MEANS OF FINANCING ................................................................................................................................. 8
TABLE: TOTAL INVESTMENT REQUIREMENT SUMMARY ............................................................... 8
9
MARKETING PLAN .......................................................................................................................................... 8
9.1
PRODUCT DESCRIPTION ..................................................................................................................... 8
9.2
MARKET SEGMENTATION ................................................................................................................. 9
9.3
MARKETING STRATEGY ...................................................................................................................... 9
9.4
MARKETING MIX STRATEGY............................................................................................................. 9
9.4.1 Products ................................................................................................................................................ 9
9.4.2 Price ........................................................................................................................................................ 9
9.4.3 Place ......................................................................................................................................................10
9.4.4 Promotion ..........................................................................................................................................11
10
MANAGEMENT PLAN ...............................................................................................................................12
ROLES AND RESPONSIBILITIES ..................................................................................................................12
11
MACHINERIES AND RAW MATERIALS .............................................................................................13
11.1
MACHINES ............................................................................................................................................13
11.2
RAW MATERIALS...............................................................................................................................13
12
Aloe Vera cultivation process ................................................................................................................14
13
SAFETY MEASURES IN THE WORKPLACE ......................................................................................15
Aloe vera Juice
Page 3
ALOE VERA CULTIVATION AND JUICE
13.1
SAFETY MEASURES FOR LABOR.................................................................................................15
13.2
PERSONAL SAFETY ...........................................................................................................................15
13.3
EYE PROTECTION ..............................................................................................................................16
13.4
NOISE ......................................................................................................................................................16
13.5
PERSONAL PROTECTIVE EQUIPMENT ....................................................................................16
13.6
SAFETY HELMET................................................................................................................................16
13.7
FIRST AID ..............................................................................................................................................16
13.8
WHEN A FIRE BREAKS OUT, YOU SHOULD REMEMBER .................................................16
14
FORECAST ......................................................................................................................................................17
14.1
PRODUCTION CAPACITY ................................................................................................................17
14.2
SALES FORECAST...............................................................................................................................17
15
FINANCIAL PLAN ........................................................................................................................................18
15.1
TOTAL PROJECT COST .....................................................................................................................18
15.2
FIXED ASSETS COST .........................................................................................................................19
15.3
FIXED ASSETS and NET FIXED ASSETS. ..................................................................................19
15.4
INVENTORY COST PROJECTION .................................................................................................20
15.5
MANPOWER COST .............................................................................................................................21
15.6
LOAN PAYMENT FOR FIVE YEARS .............................................................................................21
15.7
TOTAL OPERATIONAL EXPENDITURE PROJECTION ........................................................22
16
FINANCIAL ANALYSIS ..............................................................................................................................23
16.1
PROJECTED INCOME STATEMENT ............................................................................................23
16.2
PROJECTED CASH FLOW STATEMENT ....................................................................................23
16.3
PROJECTED BALANCE SHEET STATEMENT..........................................................................24
16.4
VALUE ADDITION & UNIT COST OF PRODUCTION ............................................................25
16.5
NET PRESENT VALUE (NPV) and INTERNAL RATE OF RETURN (IRR) ....................25
16.6
PAY BACK PERIOD ............................................................................................................................25
16.7
BREAK EVEN ANALYSIS .................................................................................................................26
17
CONCLUSION ................................................................................................................................................27
18
ANNEXURE I..................................................................................................................................................28
19 FINANCIAL ANALYSIS BASED ON 13% INTEREST ON LOAN FROM FINANCIAL
INSTITUTIONS. ........................................................................................................................................................28
20
ANNEXURE II- CONSTRUCTION COST ..............................................................................................37
21
PROJECT TIMELINE ...................................................................................................................................40
Aloe vera Juice
Page 4
ALOE VERA CULTIVATION AND JUICE
2 VISION
“360 Degree cultivation for self sufficiency and Healthy life”
3 MISSION
Cultivation and related diversification of aloe Vera Products in Bhutan
Objectives



Cultivation and production of aloe Vera.
To create employment opportunities for the youths.
Substitute import of herbal products in Bhutan.
4 THE BUSINESS PROFILE
PROPOSED NAME OF THE
BUSINESS
PROPOSED BUSINESS TYPE
PROPOSED ACTIVITY
PROPOSED BUSINESS COST
TOTAL BUSINESS COST
(including working capital)
MEANS OF FINANCING
DEBT
EQUITY
PROPOSED LOCATION OF THE
BUSINESS
PROPOSED PRODUCTS
LAND REQUIREMENT
BOIC
BTN 1,988,549
BTN 2,147,529
FINANCIAL INSTITUTIONS
Cultivation and production
Aloe Vera cultivation and Juice.
BTN 1,988,549
BTN 2,156,529
80 % Debt and 20% Equity
BTN 1,718,023
BTN 429,506
70% Debt and 30% equity
BTN 1,509,570
BTN 646,959
Wangdue Phodrang( Rubesa Gewog)
Aloe Leaf and Juice
2.2 acres of land for the project
POWER REQUIREMENT
BTN 4,000 monthly
SUPPLIER DETAILS
Machinery supplier: Om Shakti Fabricators India.
Inventory supplier (Aloe seed): Kerela Agriculture University.
Farming equipments supplier: Lhaki General stores.
Bottle filling and capping machine suppliers: BLENZOR, INDIA.
PROPOSED STAFF
REQUIREMENT
Aloe vera Juice
1 Manager
9worker
1 Accountant
1 marketer
1 watchman
Page 5
ALOE VERA CULTIVATION AND JUICE
5 BUSINESS BACKGROUND
The aloe Vera cultivation and production of juice will be carried out in Wangduephodrang
Rubesa Gewog and the reason for choosing Wangduephodrang is mainly because this place
achieves the standard needed for cultivation of aloe Vera Leaf(less rain, high temperature
and cactus is abundantly found in this place). The proponent at the initial stage has to plant
5000 aloe seedlings in one acre land and lease 20 decimal of land for the construction of
aloe juice production house. The product will be distributed in Bhutan especially in
Traditional medicinal houses (Bio Bhutan, Menjong Zorig pharmaceuticals), small
pharmaceuticals, resorts and handicrafts.
Aloe Vera juice contains leaf pulp that is rich in natural nutrients and fiber. This wellknown herbal remedy for the skin also has many benefits for internal healing, cleansing
and repair when ingested as a nutritional drink and many more benefits. People believe
more in herbal medicines rather than manufactured medicines and according to Himalaya
Agri herbal aloe Vera products are highly demanded in the international market like India,
USA, Australia and entire Europe.
Therefore, some of the machines that the proponent has to purchase are as follows:






aloe leaf washing tank(capacity: 1500 liters)
Leaf extractor( capacity:1 ton)
Homogenizer(capacity: 150 liters)
Pulp filter(capacity:150 liters)
Special juicer(capacity : 150 liters)
Bottle filling and capping machine(50-1000 ml)
Aloe juice making machines have high capacity and if desired by the proponent cultivation
can be increased as well as producing of aloe juice.
In the first year, the proposed business plans to construct a semi-permanent building on 20
decimal of land (total 20 decimal – lease). The lease land will cost Nu. 0.15 per sq ft per
year which means 20 decimal (26136 sq ft) will cost Nu. 3920 per year.
Aloe vera juice will be sold especially in the traditional medicine shops, Bio Bhutan,
handicrafts and groceries of Bhutan.
6 KEYS TO SUCCESS
6.1 Proper Inspection from BOIC
BOIC- Business Opportunity and Information Centre supports young entrepreneurs and
once the project is approved by BOIC they have phase wise allotment of fund and
inspection of work which helps in building proper foundation of the business through
which entrepreneurs are encouraged.
Aloe vera Juice
Page 6
ALOE VERA CULTIVATION AND JUICE
6.2 Four percent Loan
BOIC is a sole government organization who provides loan at four percent therefore, young
entrepreneurs gets four percent loan and doesn’t have to pay huge amount of interest to
BOIC thus, business owners have liberty to keep earn more profit.
6.3 LOCATION OF THE BUSINESS
Aloe Vera cultivation and juice producing will be located at Rubesa Gewogwangduephodrang based on the fact that wangduephodrang grows huge amount of cactus.
Moreover, this location also achieves the standard required for aloe Vera cultivation.
Aloe Vera cultivation requirements.
•
Altitude: 500-1000 m
•
Soil: Sandy loamy soil
•
Temperature: 20-22o C.
•
Annual rainfall: >800 mm in wetter areas.
Thus, Wangdue Phodrang achieves the requirements.
•
600-1200
•
20.67o C.
•
2749mm per year.
6.4 Aloe Vera –Herbal plant.
Medicinal properties of Aloe vera range from external burn treatments to helping relieve
constipation by consumption. Aloe vera is the most efficacious natural plant used both
externally and internally and there are numerous benefits that are derived from this
wonderful plant. The health benefits of Aloe vera have been propagated throughout the
world. Some of aloe benefits are as follows
i. Penetration – aloe has the ability to reach deepest body tissues some 7 layers deep
ii. Antiseptic – aloe has at least 6 antiseptic agents which kill bacteria, viruses and fungi
iii. Stimulates cell growth – aloe stimulates the birth of new healthy tissue
iv. Settles nerves – aloe has a clearing effect on the body’s nervous system
v. Cleanses – aloe detoxifies and normalizes the body’s metabolism.
thus, benefits of aloe vera plant is huge therefore, with the help of marketing success of
aloe vera is for sure.
Aloe vera Juice
Page 7
ALOE VERA CULTIVATION AND JUICE
7
SWOT ANALYSIS
7.1



STRENGTH
Government support.
Less Interest on loan.
Own raw materials (aloe leaf) for
extracting juice.
 Availability of fellow land in Bhutan.
7.2 WEAKNESS
 Non-availability of technical staff in
operating machines.
 Lack of technical expertise in aloe vera
cultivation.
7.3 OPPORTUNITY
 Related diversification of the business
(aloe powder and aloe gel).
 Import of aloe vera juice and seedlings
in India (revenue generation).
 Expanding of aloe vera cultivation in
Bhutan.
7.4 THREAT
 Cultivation may be exposed to natural
disaster.
 No ready market.
 High promotional charges.
 May not yield high quality aloe leaf.
8 MEANS OF FINANCING
The total projected cost of the business consists of startup cost and working capital.
TABLE: TOTAL INVESTMENT REQUIREMENT SUMMARY
Fixed Assets/Capital cost
1,988,549
Working Capital
158,980
Total Project Cost
2,147,529
20% equity
429,506
Loan Amount
1,718,023
9
MARKETING PLAN
9.1 PRODUCT DESCRIPTION
The proponent at the initial stage should produce aloe juice.
Aloe leaf products
Sl. No
1
2
3
Name
Aloe Juice
Aloe juice
Aloe juice
Aloe vera Juice
Quantity( mili
litres)
1000
500
250
Page 8
ALOE VERA CULTIVATION AND JUICE
9.2 MARKET SEGMENTATION
Aloe Vera contains numerous vitamins and minerals, enzymes, amino acids, natural sugars
and agents which may be anti-inflammatory and anti-microbial. The combination and
balance of the plant's ingredients are what purportedly gives it its healing properties thus,
Attracting the potential customers plays a pivotal role to achieve organizational goal. When
market is segmented company have exact market to position the product.
a) Thimphu ,Phuentsholing and Paro.
 Departmental stores (My Mart, Home mart, Tashi commercial etc…).
 Grocery Shops
 Small shops
b) Traditional medicine houses
c) Handicrafts in Bhutan
d) Resorts of Bhutan.
9.3 MARKETING STRATEGY
Each and every company that gives birth to a new product needs a proper and authentic
strategy that can actually position in the competitive market for the growth and
sustainability of the business.
Various products and services have high dependence on their commercialization, timing
and delivery to the customers but the Aloe Vera Processing unit can be started at any time
during the year due to the availability of raw material throughout the year.
9.4 MARKETING MIX STRATEGY
9.4.1 Products
In the initial stage of the business following are the products that are going to be offered in
the market.


Aloe vere juice
Aloe seedling
Aloe leaf have tremendous health benefits thus, the proponent at the initial stage should
focus in above products.
9.4.2 Price
Price of the aloe leaf will depend on the cost of production, demand and quantity and
quality aloe leaf available for making aloe juice but as far as possible the price of aloe
products will be kept minimal.
Aloe Vera products
Sl No
Name/Species
Quantity(mili litre)
Price(Nu)
1
Aloe juice
1000
100
2
Aloe juice
500
60
3
Aloe juice
250
40
Aloe vera Juice
Page 9
ALOE VERA CULTIVATION AND JUICE
9.4.3 Place
Though aloe Vera plant grows in any kind of soil, it best grows in sandy loamy, elevation
ranging from 500-1000 m and mean annual temperature of 20-30o Celsius thus; growing of
aloe Vera plant will be in Wangdiphodrang- Rubesa Gewog since this place qualifies most of
the aloe Vera cultivation requirements. But when it comes to the aloe Vera juice it will be
made available throughout the country and proponent can distribute through whole
sellers.
FEASIBILITY STUDY OF ALOE VERA CULTIVATION IN WANGDUEPHODRANG
According to Manvitha. K (2014), “Aloe Vera is a perennial, drought-resisting, succulent
plant belonging to the Asphodelaceae family. The name, aloe, is derived from the Arabic
"alloeh" or Hebrew "halal" meaning bitter shiny substance. It has a vast traditional role in
indigenous system of medicine like ayurveda, siddha, Unani and homoeopathy thus, aloe
Vera cannot be grown everywhere therefore following are the standards required for
cultivation of aloe Vera.
 CLIMATE
Standard: Aloe Vera is found to grow in hot humid and it cannot resist extreme cold
conditions.
Wangduephodrang: The climate is warm and temperate in Wangdue Phodrang.
 Rainfall
Standard: It can resist annual rainfall of> 800 mm which is indeed ideal rainfall for
cultivation of aloe Vera.
Wangduephodrang: 2749 mm per year.
 SOIL
Standard: It is grown in all kind of soils but well drained soil with high organic matter, is
most suitable. Sandy loam soil is the best soil for cultivation of aloe Vera. Shady conditions
results in disease infestation. It is highly sensitive to water stagnation. Therefore, well
drained high land should be selected for its cultivation.
Wangduephodrang: drainage is more important for cultivation of aloe vera but if soil is
not sandy loam soil drainage for aloe Vera can be made by making mound and planting aloe
Vera plant.
 Elevation/Altitude
Standard: For aloe Vera cultivation the elevation requirement should be ranging from 6001200 m above the sea level”.
Wangduephodrang (Rubesa): Rubesa has an elevation of 1200 m above the sea level
(Dzongkhag profile Wangduephodrang).
Wangdue Phodrang is an ideal place for growing aloe Vera plant mainly because it achieves
the standard required for cultivation of aloe Vera and moreover, abundant cactus is grown
there. Aloe Vera and Cactus have similar features thus, place where cactus is grown aloe
Vera can be grown.
Aloe vera Juice
Page 10
ALOE VERA CULTIVATION AND JUICE
9.4.4 Promotion
Aloe Vera has lots of health benefits but most of the people have less knowledge about its
benefits thus, they retain themselves from buying the products and moreover they are not
being educated on health benefits of aloe leaf therefore, the proponent has to follow the
following promotion strategies.
Virtual and print media promotion
a)
b)
c)
d)
Infomercial: use of traditional medicine doctors.
Advertisement in Television: BBS
Print Media: Kuensel and others.
Social Media-Face book.
Aloe vera Juice
Page 11
ALOE VERA CULTIVATION AND JUICE
10 MANAGEMENT PLAN
Human Resource REQUIREMENT
PARTICULARS
Manager
Marketing and sales person
Accountant
Workers
Part time workers
Watchman
No of required people
1
1
1
4
3
1
Monthly Salary
15,000
13,000
13,000
30,000
9,000
7,500
Yearly
180,000
156,000
156,000
360,000
108,000
90,000
TOTAL
11
87,500
1,050,000
ROLES AND RESPONSIBILITIES
Manager: Responsibilities to manage the business, enter into agreement, sign contract,
strike deal, supervise and manage overall business operations.
Marketing: solely responsible for making marketing strategies and marketing of the
products.
Accountant: He/she will keep the daily records of the business.
Workers : Their responsibility is to carry out production of aloe Vera Juice.
Watchman: He is solely responsible for taking care of production plant especially during
night.
Aloe vera Juice
Page 12
ALOE VERA CULTIVATION AND JUICE
11 MACHINERIES AND RAW MATERIALS
11.1 MACHINES
The machines (Sl No1-5) will be purchases from Om Shakti Fabricators (Manufacturing of
aloe vera plant and Pharma Mahineries) India and Bottle filling and capping machine from
BLENZOR INDIA.
Sl. No.
1
2
3
4
5
6
Machines
Aloe leaf washing tank with Bubbling
Leaf Extractor
Homogenizer
Pulp filter with double jacket and
vacuum pump.
Special Juicer
Bottle filling and capping machine
Capacity
1500 ltrs
1 ton
150 ltrs
Price(in
USD)
2100
4800
2400
Price(in
Rupees)
142833.6
326476.8
163238.4
150 ltrs/hr
50-1000ml
4700
2400
2572
319675.2
163238.4
178500
11.2 RAW MATERIALS
PARTICULARS
INVENTORY PROJECTION
PER
MONTHLY
UNIT MONTHLY
REQUIREMENT(kg) COST
COST
Year 1
Year 2
Year 3
Year 4
Year 5
Aloe seedling( ploy bag)
10000
10
100,000
100,000
100,000
100,000
100,000
100,000
Aloe juice Bottle(250, 500 and 1000ml)
2041
3
5,103
61,230
64,292
67,506
70,881
74,425
Cartoon
476
5
2,380
28,560
29,988
31,487
33,062
34,715
Cello tape
10
40
400
4,800
5,040
5,292
5,557
5,834
Fertilizers (trucks)
3
2,000
6,000
72,000
75,600
79,380
83,349
87,516
Neem oil cake
1000
43
43,000
516,000
541,800
568,890
597,335
627,201
Printed aloe plastic
100
3
300
3,600
3,780
3,969
4,167
4,376
Bottle cap
204
1
102.00
1,224
1,285
1,349
1,417
1,488
Total
13834
2,104
157,285
787,414
821,785
857,874
895,768
935,556
Assumption:



Aloe seedling will be purchased from Kerala Agriculture University.
10000 aloe seedlings will be planted in two acre of land.
It is assumed that 10000 aloe seedlings will be purchased but the proponent can
propagate aloe Vera which will reduce cost of inventory.
Aloe vera Juice
Page 13
ALOE VERA CULTIVATION AND JUICE
12 Aloe Vera cultivation process
Though Aloe Vera can be cultivated on any soil for 'dry land management', sandy loamy soil
is the best suited for it. Aloe Vera is generally propagated by root suckers by carefully
digging out without damaging the parent plant and planting it in the main field. It can also
be propagated through rhizome cuttings. By digging out the rhizomes after the harvest of
the crop and making them into 5 to 6 cm length cuttings with a minimum of 2 to 3 nodes on
them. Then they are rooted in specially prepared sand beds or containers. The plant is
ready for transplanting after the appearance of the first sprouts. The process of cultivating
Aloe Vera involves the following process:
STEP I: Land Preparation
The ground is to be carefully prepared to keep it free from weeds and the soil is ideally
kept slightly acidic. The soil should be supplied supplement in the form of ammonium
nitrate every year.
STEP II: Spacing Requirements
The plants are spaced out by 31 inches in rows and between the rows. At that rate, about
5,000 plants are set per acre. 8 to 12 inch aloe pop would take about 18 to 24 months to
fully mature.
STEP IV: Growing season
The plants, in a year's time, would bear flowers that are bright yellow in colour. The leaves
are 1 to 2 feet long and are cut without causing damage to the plant, so that it lasts for
several years.
STEP III: Harvesting

The crop can be harvested 4 times a year. At the rate of 3 leaves cut from each plant,
about 12 leaves are harvested per plant per year. On an average, the yield per acre
annually can vary from 15,000 to 60,000 kg. (Commercial average is 30,000 to
35,000 Kgs per acre, per year, depending on supply of water).
STEP IV: Harvesting Process
The leaves cut off close to the plant are placed immediately, with the cut end downwards,
in a V-shaped wooden trough of about 4 feet long and 12 to 18 inches deep.

The wooden trough is set on a sharp incline so that the juice, which trickles from the
leaves very rapidly, flows down its sides, and finally escapes by a hole at its lower
end into a vessel placed beneath.
Aloe vera Juice
Page 14
ALOE VERA CULTIVATION AND JUICE




It takes about a quarter of an hour to cut leaves enough to fill a trough. The troughs
are so distributed as to be easily accessible to the cutters.
The leaves are neither infused nor boiled, nor used afterwards except for manure.
When the vessels receiving the juice get filled, the latter is removed to a cask or
reserved for evaporation. This may be done at once, or it may be delayed for weeks
or even months.
The evaporation is generally conducted in a copper vessel. At the bottom of this is a
large ladle, into which the impurities sink, and are removed from time to time as the
boiling goes on.
As soon as the inspissations has reached the proper point, which is determined
solely by the experienced eye of the workman, the thickened juice is poured into
large gourds or into boxes, and allowed to harden.
12.1 Aloe Juice Extraction Process






The raw material (leaves) will be washed and cut down from edges to fed to the
processing unit.
The juice extraction is carried out in a power driven machine. Thus, leaves are
continuously squeezed and extracted Squeezed liquor is collected in front and the
extracted leaves at the rear end of the machine.
Residual juice from the squeezed leaves is also drained and collected. The viscous
clear transparent juice is then passed through a filtration-cum-homogenizing unit to
get clear, water white, transparent juice.
The juice will be heated to 60-70 degree Celsius and then rapidly cooled down so as
to kill the microorganisms and hence there will be no need of any chemical
preservative or agent.
Aloe Juice will be sent to filling machine.
And last process involves is bottle capping and packing.
13 SAFETY MEASURES IN THE WORKPLACE
13.1 SAFETY MEASURES FOR LABOR
 Before operating a machine, ensure that the dangerous part of the machine has been
installed with a guard.
 Keep vigilant all the time and watch out for moving cranes, hooks or other lifting
equipment.
 Before using any electrical installation or tool, check the condition of its electric
cables.
 Avoid dragging electric cables on the ground or allowing the cables to come into
contact with water.
 Use electrical tools installed with an earth leakage circuit breaker.
13.2 PERSONAL SAFETY
 Wear protective equipment.
Aloe vera Juice
Page 15
ALOE VERA CULTIVATION AND JUICE




Do not drink or take drugs while working.
Pay attention to personal hygiene.
Do not play in the workplace.
Report to supervisor immediately if anybody notice any unsafe condition
13.3



EYE PROTECTION
A wise worker will certainly take good care of his eyesight.
A small fragment may cause serious consequences if it enters one's eyes.
When there is a risk of eye injury, such as in concrete breaking or using abrasive
wheels, should wear suitable eye protectors.
 Care of the eye protectors will be provided to all labor.
 Replace damaged or defective eye protectors immediately.
 Ensure that eye protectors are comfortable to wear, and keep clean.
13.4




NOISE
Wear ear protectors in areas with high noise levels.
Properly wear ear protectors according to the manufacturer's instructions.
Do not reuse disposable ear plugs.
Clean ear protectors regularly.
13.5





PERSONAL PROTECTIVE EQUIPMENT
For own safety and interest, personal protective equipment will be provided
Will be provided gloves while handling or contacting with machines.
Remember to wear a mask when working in a dusty environment.
Wear eye and ear protectors whenever necessary.
Wear a safety harness and secure it to a safe anchorage point when working at
height.
 Wear safety shoes to prevent foot injury.
13.6



SAFETY HELMET
Will provide a safety helmet on a construction site.
Keep the harness of the helmet clean and make sure that it fits well.
Do not drill any holes on the helmet or use it for pounding.
13.7 FIRST AID
 If you sustain an injury or feel not well while at work, even if it is minor, go to the
first aid room right away for medical treatment and notify your supervisor.
 Put the case on record
13.8 WHEN A FIRE BREAKS OUT, YOU SHOULD REMEMBER
 Put out the fire with a fire extinguisher if it is a small fire.
 If the blaze is out of control, do not try to extinguish the fire on your own. Call the
Fire Services Department right away.
 Emergency telephone numbers:
 Always pay attention to the emergency telephone numbers posted on the notice
board in the site office.
Aloe vera Juice
Page 16
ALOE VERA CULTIVATION AND JUICE
14 FORECAST
14.1 PRODUCTION CAPACITY
PRODUCTION CAPACITY
PRODUCTION PROJECTION FOR FIVE YEARS
monthly(mil Year
Year 2
Year 3
i litres)
1
970
11,640
12,222
1,940
23,280
24,444
3,880
46,560
48,888
6,790
81,480
85,554
Name of the
Product
aloe Vera (1000 ml)
aloe Vera (500 ml)
aloe Vera (250ml)
Total
Year 4
Year 5
12,833
25,666
51,332
89,832
13,475
26,950
53,899
94,323
Note:
 Harvesting of leaf starts from second year of planting.
 It is assumed that from two acre of land the aloe yield would be 80000 aloe leaves (2
leaves from one plant which can be harvested four times a year 4*2*10000=80000).
 2 % of wastage has been considered in the production process.
 From total of 77,600 aloe leaf 55% (42,680) is considered as aloe leaf wastage thus,
from total aloe leaf, it is assumed that juice production will be 34,920 litres).
 Aloe Vera yield is kept minimal to avoid over estimation of aloe juice production.
14.2 SALES FORECAST
SALES PROJECTION FOR FIVE YEARS
Product
aloe Vera (1000 ml)
unit
cost
100
aloe Vera (500 ml)
60
116,400
-
1,396,800
1,466,640
1,539,972
1,616,971
aloe Vera (250ml)
40
155,200
-
1,862,400
1,955,520
2,053,296
2,155,961
368,600
-
4,423,200
4,644,360
4,876,578
5,120,407
TOTAL SALES
Note:





Monthly
Year 1
Year 2
Year 3
Year 4
Year 5
97,000
-
1,164,000
1,222,200
1,283,310
1,347,476
Aloe Vera Price for 1 litre=Nu.100
Aloe Vera Price for 500 ml litre=Nu.60
Aloe Vera Price for 250ml litre=Nu.40
Selling Price has been kept at minimal to avoid over estimation of sales.
It is assumed 100% sale.
Aloe vera Juice
Page 17
ALOE VERA CULTIVATION AND JUICE
15 FINANCIAL PLAN
15.1 TOTAL PROJECT COST
COMPONENTS OF PROJECT COST
Amt in Nu.
PARTICULARS
Domestic Component
Land preparation(2 acre)
Total Cost
Remarks
95,030
lease
Total Cost
Civil Works
Plant construction(20 decimal)
419,500
Furniture and equipments
30,000
Electrification
8,000
Fencing(Barbed wire) one acre
90,000
Total
547,500
Plant & Machinery
Aloe leaf washing tank
4,000
aloe leaf pulp extractor
326,477
Homogenizer
163,238
pulp filter
319,675
special juice mixer
163,238
Bottle filling and capping
178,500
Farming Equipments
1. Spade (5 no’s)
1,250
2. Hoe (4 no’s)
1,000
3. Sickle and knife (6 no’s)
1,200
4. Gloves(5 no's)
1,500
Office equipments
a) Desktop( 2 no's)
60,000
b) printer(1)
15,000
c) Telephone(1)
2,500
1,237,579
Total
Miscellaneous Fixed Assets:
Total Cost
Preliminary Expenses
10,000
installation charge
63,440
consultancy fee
20,000
freight charge
25,000
Total
Aloe vera Juice
108,440
1,988,549
Page 18
ALOE VERA CULTIVATION AND JUICE
Note:
 The cost breakdown for the construction of semi-permanent building and the labor
cost are attached in the annexure.
15.2 FIXED ASSETS COST
15.3 FIXED ASSETS and NET FIXED ASSETS.
Fixed Assets
NET FIXED ASSETS
PARTICULARS
Total
Amount
Yearl
y
Dep
Monthly
Dep
Year 1
Year 2
Year 3
Year
4
Year
5
12,585
1,049
406,915
345,878
293,996
249,897
212,412
900
75
29,100
24,735
21,025
17,871
15,190
270
23
8,730
7,421
6,307
5,361
4,557
3,000
250
97,000
82,450
70,083
59,570
50,635
16,755
1,396
541,745
460,483
391,411
332,699
282,794
600
50
3,400
2,890
2,457
2,088
1,775
48,972
4,081
277,505
235,879
200,498
170,423
144,859
24,486
2,040
138,753
117,940
100,249
85,211
72,430
47,951
3,996
271,724
230,965
196,321
166,872
141,842
24,486
2,040
138,753
117,940
100,249
85,211
72,430
26,775
2,231
151,725
128,966
109,621
93,178
79,201
188
16
1,063
903
768
653
555
150
13
850
723
614
522
444
180
15
1,020
867
737
626
532
225
19
1,275
1,084
921
783
666
9,000
750
51,000
43,350
36,848
31,320
26,622
2,250
188
12,750
10,838
9,212
7,830
6,656
375
31
2,125
1,806
1,535
1,305
1,109
185,637
15,470
1,051,942
894,151
760,028
646,024
549,120
1,593,687
1,354,63
4
1,151,439
978,723
831,915
Civil:
plant construction
419,500
furniture and equipments
30,000
electrification
Fencing(Barbed wire) one
acre
Total
9,000
100,000
558,500
Plant & Machinery:
Aloe leaf washing tank
4,000
aloe leaf pulp extractor
326,477
Homogenizer
163,238
pulp filter
319,675
special juice mixer
163,238
Bottle filling and capping
178,500
Farming Equipments
1. Spade (5 no’s)
1,250
2. Hoe (4 no’s)
1,000
3. Sickle and knife (6 no’s)
1,200
4. Gloves(5 no's)
1,500
Office equipments
a) Desktop( 2 no's)
60,000
b) printer(1)
15,000
c) Telephone(1)
2,500
Total
1,237,579
TOTAL
1,796,079
202,392
16,866
Note:
Aloe vera Juice
Page 19
ALOE VERA CULTIVATION AND JUICE

The depreciation has been done according to the Income Tax Act of The Kingdom of
Bhutan. The permanent structure is depreciated at 3% per annum and other assets
at 15% per annum.
Aloe Vera juice extraction machine purchased from India are payable in US DOLLAR
but for calculation it is converted in Indian rupees. Dollar value in India accounts to
$68.016.

15.4 INVENTORY COST PROJECTION
PARTICULARS
Aloe seedling( ploy bag)
INVENTORY PROJECTION
PER
UNI
MONTHLY
MONTH
T
Year
REQUIREMENT
LY
COS
1
(kg)
COST
T
Year
2
Year
3
Year
4
Year
5
100,0
00
100,0
00
100,0
00
100,0
00
100,0
00
61,230
64,292
67,506
70,881
74,425
10000
10
100,000
Aloe juice Bottle(250, 500 and
1000ml)
2041
3
5,103
Cartoon
476
5
2,380
28,560
29,988
31,487
33,062
34,715
400
4,800
5,040
5,292
5,557
5,834
72,000
75,600
79,380
83,349
87,516
516,00
0
3,600
541,80
0
3,780
568,89
0
3,969
597,33
5
4,167
627,20
1
4,376
1,224
787,4
14
1,285
821,7
85
1,349
857,8
74
1,417
895,7
68
1,488
935,5
56
Cello tape
10
3
40
2,00
0
Fertilizers (trucks)
6,000
Neem oil cake
1000
43
43,000
Printed aloe plastic
100
3
300
Bottle cap
204
1
2,10
4
102.00
Total
13834
157,285
Note:



Aloe seedling will be purchased from Kerala Agriculture University.
10000 aloe seedlings will be planted in two acre of land.
It is assumed that 10000 aloe seedlings will be purchased but the proponent can
propagate aloe Vera which will reduce cost of inventory.
Aloe vera Juice
Page 20
ALOE VERA CULTIVATION AND JUICE
15.5 MANPOWER COST
Human Resource REQUIREMENT
PARTICULARS
Manager
No of required people
1
Monthly Salary
Yearly
15,000
180,000
Marketing and sales person
1
13,000
156,000
Accountant
1
13,000
156,000
Workers
4
30,000
360,000
Part time workers
3
9,000
108,000
Watchman
1
7,500
90,000
TOTAL
11
87,500
1,050,000
Direct labor
Salary & allowances
Wages
Total
Particulars
Direct Labor
Salary & allowances
Wages
Payroll (direct
+salary)
30,000
48,500
9,000
87,500
Monthly
30,000
48,500
9,000
Year 1
360,000
582,000
108,000
Year 2
396,000
640,200
118,800
78,500
942,000
1,050,000
1,036,200
1,155,000
Year 3
435,600
704,220
130,680
Year 4
479,160
774,642
143,748
Year 5
527,076
852,106
158,123
1,139,820 1,253,802 1,379,182
1,270,500 1,397,550 1,537,305
Note:
 Inflation rate of 10% has been considered in the manpower cost annually.
 The number total worker is assumed to be 11 peoples for the first year.
 The manpower cost is increased 10% annually since its manual labor and needs to
encourage the employees.
15.6 LOAN PAYMENT FOR FIVE YEARS
Interest
Principal
ending balance
Aloe vera Juice
Year 1
62,956
316,724
1,401,299
Year 2
113,009
646,352
1,071,671
Year 3
36,623
343,057
728,614
Year 4
22,646
357,034
371,580
Year 5
8,100
371,580
0
Page 21
ALOE VERA CULTIVATION AND JUICE
15.7 TOTAL OPERATIONAL EXPENDITURE PROJECTION
PARTICULARS
YEAR 1
YEAR 2
YEAR 3
YEAR 4
YEAR 5
Purchases (inventory & others)
787,414
821,785
857,874
895,768
935,556
Freight-in
25,000
Direct labor
360,000
396,000
435,600
479,160
527,076
Indirect Expenses (electricity)
3,000
3,150
3,308
3,473
3,647
1,175,414
1,220,935
1,296,781
1,378,401
1,466,279
Advertising
10,000
10,200
10,404
10,612
10,824
Salary & Allowances
582,000
640,200
704,220
774,642
852,106
Commissions
5,000
5,100
5,202
5,306
5,412
Delivery expenses
10,000
10,200
10,204
10,204
10,204
Depreciation
202,392
232,751
267,663
307,813
353,985
2,000
2,000
2,000
2,000
2,000
113,009
36,623
22,646
8,100
Cost of Goods Sold:
Less:
Ending Inventory
Total Cost of Goods Sold
Expenses:
Dues and subscriptions
Insurance
Interest
Office expenses
5,000
5,100
5,202
5,306
5,412
Permits and licenses
1,700
1,734
1,735
1,735
1,735
Professional fees
20,000
Rent/lease
640
640
640
640
640
Telephone
5,000
5,100
5,102
5,102
5,102
Travel
2,000
2,040
2,041
2,041
2,041
Vehicle expenses
1,000
1,020
1,020
1,020
1,020
Wages
108,000
118,800
130,680
143,748
158,123
total
954,732
1,147,893
1,182,736
1,292,815
1,416,704
Total Expenses
2,130,146
2,368,828
2,479,517
2,671,215
2,882,983
Monthly expenses
177,512
197,402
206,626
222,601
240,249
Repairs
Note:
 All the expenses is increased by 5% every year.
Aloe vera Juice
Page 22
ALOE VERA CULTIVATION AND JUICE
16 FINANCIAL ANALYSIS
16.1 PROJECTED INCOME STATEMENT
INCOME STATETMENT PROJECTION FOR 5 YEARS
YEAR 1
YEAR 2
YEAR 3
YEAR 4
YEAR 5
1,175,414
4,423,200
1,220,935
4,644,360
1,296,781
4,876,578
1,378,401
5,120,407
1,466,279
(1,175,414)
3,202,265
3,347,579
3,498,177
3,654,128
954,732
1,147,893
1,182,736
1,292,815
1,416,704
(2,130,146)
2,054,372
2,164,843
2,205,363
2,237,424
Tax deduction
(639,044)
616,312
649,453
661,609
671,227
Net Income (Loss)
(1,491,102)
1,438,061
1,515,390
1,543,754
1,566,197
Revenue
Cost of Goods Sold
Gross Profit
Expenses
Net Operating
Income
16.2 PROJECTED CASH FLOW STATEMENT
Projected Cash Flow Statement
Year 1
Year 2
Year 3
Year 4
Year 5
429,506
(1,748,774)
(108,003)
1,981,4
46
4,137,587
Accts. Rec. Collections
-
442,320
464,436
487,658
512,041
Loan Proceeds
1,718,023
Sales & Receipts
-
3,980,880
4,179,924
Total Cash Inflows
1,718,023
4,423,200
4,644,360
2,147,529
2,674,426
4,536,357
Advertising
10,000
10,200
Bank Service Charges
-
Delivery
Beginning
Cash Balance
4,388,92
0
4,876,5
78
6,858,0
24
5,120,407
10,404
10,612
10,824
-
-
-
-
10,000
10,200
10,204
10,204
10,204
Insurance
2,000
2,000
2,000
2,000
2,000
Interest
-
113,009
36,623
22,646
8,100
Inventory Purchases
787,414
821,785
857,874
895,768
935,556
Office
5,000
5,100
5,202
5,412
Payroll
942,000
1,036,200
1,139,820
5,306
1,253,80
2
Available
Cash Balance
4,608,366
9,257,994
Credit Card Fees
1,379,182
Payroll Taxes
Aloe vera Juice
Professional Fees
-
-
-
-
-
Rent or Lease
640
640
640
640
640
Subscriptions & Dues
-
-
-
-
-
Page 23
ALOE VERA CULTIVATION AND JUICE
Supplies
Taxes & Licenses
1,700
1,734
1,735
1,735
1,735
Utilities & Telephone
5,000
5,100
5,102
5,102
5,102
Other:
144,000
130,110
142,251
170,243
Subtotal
1,907,754
2,136,077
2,211,854
155,588
2,363,40
3
Capital Purchases
1,988,549
Loan Principal
-
646,352
343,057
357,034
371,580
Subtotal
1,988,549
646,352
343,057
371,580
Total Cash Outflows
3,896,303
2,782,429
2,554,911
(1,748,774)
(108,003)
1,981,446
357,034
2,720,4
37
4,137,5
87
Ending Cash
Balance
2,528,998
2,900,578
6,357,415
16.3 PROJECTED BALANCE SHEET STATEMENT
Projected Balance Sheet For 5 Years
Year 1
Year 2
Year 3
Year 4
Year 5
Cash & Bank
(1,748,774)
(108,003)
1,981,446
4,137,587
6,357,415
Accounts Receivable
-
442,320
464,436
487,658
512,041
-
-
-
-
Assets
Inventory
Prepaid expenses
Other Current Assets
Total Current Assets
(1,748,774)
334,317
2,445,882
4,625,245
6,869,456
Net Fixed Assets
1,593,687
1,354,634
1,151,439
978,723
831,915
(155,087)
1,688,951
3,597,320
5,603,968
7,701,371
(557,746)
(1,250,287)
923,811
3,259,128
5,705,668
(1,250,287)
923,811
3,259,128
5,705,668
Other Assets
Total Assets
Liabilities & Capital
Accounts Payable
Taxes Payable
Payroll Taxes Payable
Accrued Interest
62,956
Unearned Revenue
Short-Term Notes Payable
Short-Term Bank Loan Payable
Total Current Liabilities
(494,790)
Long-Term Notes Payable
1,401,299
1,071,671
728,614
371,580
0
Total Long-Term Liabilities
1,401,299
1,071,671
728,614
371,580
0
Total Liabilities
906,509
(178,616)
1,652,425
3,630,708
5,705,668
Owner's Equity
429,506
429,506
429,506
429,506
429,506
Aloe vera Juice
Page 24
ALOE VERA CULTIVATION AND JUICE
Net Profit
(1,491,102)
1,438,061
1,515,390
1,543,754
1,566,197
Total Capital
(1,061,596)
1,867,566
1,944,896
1,973,260
1,995,703
Total Liabilities & Capital
(155,087)
1,688,951
3,597,321
5,603,968
7,701,371
16.4 VALUE ADDITION & UNIT COST OF PRODUCTION
Cost of production
Raw materials cost
Value addition
Total units
Cost of production
Unit cost of
production
Year 1
1,120,340
787,414
29.72
Year 2
1,960,644
821,785
58.09
Year 3
1,697,037
857,874
49.45
Year 4
1,824,669
895,768
50.91
Year 5
1,965,022
935,556
52.39
Year 1
1,120,340
Year 2
81,480
1,960,644
Year 3
85,554
1,697,037
Year 4
89,832
1,824,669
Year 5
94,323
1,965,022
24
20
20
21
16.5 NET PRESENT VALUE (NPV) and INTERNAL RATE OF RETURN (IRR)
Particular
Discount rate
Initial investment
Net cash flow year 1
Net cash flow year 2
Net cash flow year 3
Net cash flow year 4
Net cash flow year 5
NPV
IRR
Amount
10%
(2,147,529)
(1,491,102)
1,438,061
1,515,390
1,543,754
1,566,197
850,828
18%
16.6 PAY BACK PERIOD
Number of years
year
0
1
2
3
4
5
Cash inflow
(2,147,529)
(1,491,102)
1,438,061
1,515,390
1,543,754
1,566,197
cumulative cash inflow
(2147529)
(3638631)
(2200570)
(685180)
858573
2424770
Payback period
Aloe vera Juice
3 years and 4 months
Page 25
ALOE VERA CULTIVATION AND JUICE
16.7 BREAK EVEN ANALYSIS
Time
Unit start
Unit
Increment
Unit Price
Unit Cost
Variable
Total Fixed
Costs
month
-
20,000
54
34
1,796,079
units
sales
variable cost
contribution
margin
fixed
total cost
net
income
-
-
-
1,796,079
1,796,079
(1,796,079)
20,000
1,085,714
682,972
402,742
1,796,079
2,479,051
(1,113,107)
40,000
2,171,429
1,365,944
805,484
1,796,079
3,162,023
(430,134)
60,000
3,257,143
2,048,917
1,208,226
1,796,079
3,844,996
252,838
80,000
4,342,857
2,731,889
1,610,968
1,796,079
4,527,968
935,810
100,000
5,428,571
3,414,861
2,013,710
1,796,079
5,210,940
1,618,782
120,000
6,514,286
4,097,833
2,416,452
1,796,079
5,893,912
2,301,755
140,000
7,600,000
4,780,806
2,819,194
1,796,079
6,576,885
2,984,727
160,000
8,685,714
5,463,778
3,221,936
1,796,079
7,259,857
3,667,699
180,000
9,771,429
6,146,750
3,624,678
1,796,079
7,942,829
4,350,671
200,000
10,857,143
6,829,722
4,027,420
1,796,079
8,625,801
5,033,644
220,000
11,942,857
7,512,695
4,430,162
1,796,079
9,308,773
5,716,616
BREAK EVEN
X
BREAK EVEN
Y
LABEL
89,193
4,841,906
break even unit =89193
BREAK EVEN ANALYSIS
sales
fixed
total cost
break even unit =89193
14,000,000
12,000,000
10,000,000
8,000,000
6,000,000
4,000,000
2,000,000
-
Aloe vera Juice
50,000
100,000 150,000
units
200,000
250,000
Page 26
ALOE VERA CULTIVATION AND JUICE
17 CONCLUSION
Aloe Vera cultivation and juice extraction is a commercial production centre to be established at
Wangdi Dzongkhag (Rubesa Gewog) which requires a financial investment worth of BTN 2,147,529
if chosen BOIC and BTN 2,156,529 if chosen financial institutions. The main objective of the
proposed business is to cultivate aloe Vera as well as produce aloe Vera juice and distribute in the
nation thus, substituting huge import in the country. In the initial year, the business plans on
cultivating 10000 aloe Vera seedling in two acre of fellow land and extraction of aloe juice.
With this business, it’s expected to curb an outflow of INR and cashing in on the foreign currency in
the initial years in its own small ways. But the effect will be more in the future with its expansion
and diversification of the products which will also create more employment opportunities. Though
the proposed business has projected the production for five years, it plans on producing more to
meet the market demand and substitute import .The production shown in the projection is kept at
very minimal level. The machines have high production capacity.
The fact that the aloe Vera cultivation and juice extraction is a first business in Bhutan it has a huge
capacity in the home market as well as foreign market due to its herbal qualities which can cure
many internal and external diseases. It is clear that 83% of the total business cost is invested in
purchasing fixed assets which is the production engine of the proposed business. This indicates that
the proposed business is feasible and viable in terms of its investment strategy.
Besides its healthy financial standing due to its strategic investment and management plan, the
proponent also enjoys healthy liquidity with the payback period of three years and four months, net
present value (NPV) of BTN 850,828 and an internal rate of return (IRR) of 18%. The business can
achieve its breakeven point at 89193units by three years from the time of production with an
increment of 20000 units. This is a stage where forecasted revenue exactly meets the total cost,
where loss ends and profit accumulates. This is a point where business becomes financially viable.
ROI (Return on investment) from the Aloe Vera Juice production are 106%, 116%, 127% and 138%
there is an increasing trend in ROI which certifies that the money invested by the proponent has a
positive return. This can be achieved if the proponent chooses BOIC for funding support.
If the proponent chooses financial institutions then he/she enjoys healthy liquidity with payback
period of three years and six months with NPV of BTN 639,385 and IRR of 16%. The business can
achieve its breakeven point at 10, 0443 units by three years from the time of production with an
increment of 20000 units. This is a stage where forecasted revenue exactly meets the total cost,
where loss ends and profit accumulates. This is a point where business becomes financially viable.
ROI( Return on investment) from the Aloe Vera Juice production are 105%, 115%, 126% and 137%
there is a increasing trend in ROI which certifies that the money invested by the proponent has a
positive return however ROI for first year is zero since there is no sale of aloe juice since its
gestation period is for one year.
Bottom is that aloe cultivation and production of juice is feasible in Bhutan based on the above
mentioned fact.
Aloe vera Juice
Page 27
ALOE VERA CULTIVATION AND JUICE
18 ANNEXURE I
19 FINANCIAL ANALYSIS BASED ON 13% INTEREST ON LOAN FROM
FINANCIAL INSTITUTIONS.
1. FORECAST
a) PRODUCTION CAPACITY
PRODUCTION CAPACITY
PRODUCTION PROJECTION FOR FIVE YEARS
monthly(mili
Year 1 Year 2
Year 3
litres)
970
11,640
12,222
1,940
23,280
24,444
3,880
46,560
48,888
6,790
81,480
85,554
Name of the Product
aloe Vera (1000 ml)
aloe Vera (500 ml)
aloe Vera(250ml)
Total
Year 4
Year 5
12,833
25,666
51,332
89,832
13,475
26,950
53,899
94,323
b) SALES FORECAST
Product
aloe Vera (1000
ml)
aloe Vera (500
ml)
aloe Vera(250ml)
TOTAL SALES
Aloe vera Juice
unit
cost
SALES PROJECTION FOR FIVE YEARS
Year
Monthly
Year 2
Year 3
1
Year 4
Year 5
100
97,000
-
1,164,000
1,222,200
1,283,310
1,347,476
60
116,400
-
1,396,800
1,466,640
1,539,972
1,616,971
40
155,200
-
1,862,400
1,955,520
2,053,296
2,155,961
368,600
-
4,423,200
4,644,360
4,876,578
5,120,407
Page 28
ALOE VERA CULTIVATION AND JUICE
2. FINANCIAL PLAN
a) TOTAL PROJECT COST
COMPONENTS OF PROJECT COST
Amt in Nu.
PARTICULARS
Domestic Component
Land preparation(2 acre)
Total Cost
Remarks
95,030
lease
Total Cost
Civil Works
Plant construction(20 decimal)
419,500
Furniture and equipments
30,000
Electrification
8,000
Fencing(Barbed wire) one acre
90,000
Total
547,500
Plant & Machinery
Aloe leaf washing tank
4,000
aloe leaf pulp extractor
326,477
Homogenizer
163,238
pulp filter
319,675
special juice mixer
163,238
Bottle filling and capping
178,500
Farming Equipments
1. Spade (5 no’s)
1,250
2. Hoe (4 no’s)
1,000
3. Sickle and knife (6 no’s)
1,200
4. Gloves(5 no's)
1,500
Office equipments
a) Desktop( 2 no's)
60,000
b) printer(1)
c) Telephone(1)
15,000
2,500
1,237,579
Total
Miscellaneous Fixed Assets:
Total Cost
Preliminary Expenses
10,000
installation charge
63,440
consultancy fee
20,000
freight charge
25,000
Aloe vera Juice
108,440
Page 29
ALOE VERA CULTIVATION AND JUICE
Total
1,988,549
b) FIXED ASSETS AND NET FIXED ASSETS
Fixed Assets
NET FIXED ASSETS
PARTICULARS
Total
Amount
Yearly
Dep
Monthl
y
Dep
Year 1
Year 2
Year 3
Year 4
Year 5
12,585
1,049
406,915
345,878
293,996
249,89
7
212,41
2
Civil:
plant construction
419,500
furniture and equipments
30,000
900
75
29,100
24,735
21,025
17,871
15,190
electrification
Fencing(Barbed wire) one
acre
9,000
270
23
8,730
7,421
6,307
5,361
4,557
100,000
3,000
250
97,000
82,450
70,083
59,570
50,635
Total
558,500
16,755
1,396
541,745
460,483
391,411
332,69
9
282,79
4
4,000
600
50
3,400
2,890
2,457
2,088
1,775
144,85
9
Plant & Machinery:
Aloe leaf washing tank
aloe leaf pulp extractor
Homogenizer
pulp filter
326,477
163,238
319,675
48,972
4,081
277,505
235,879
200,498
170,42
3
24,486
2,040
138,753
117,940
100,249
85,211
72,430
141,84
2
47,951
3,996
271,724
230,965
196,321
166,87
2
special juice mixer
163,238
24,486
2,040
138,753
117,940
100,249
85,211
72,430
Bottle filling and capping
178,500
26,775
2,231
151,725
128,966
109,621
93,178
79,201
1. Spade (5 no’s)
1,250
188
16
1,063
903
768
653
555
2. Hoe (4 no’s)
1,000
150
13
850
723
614
522
444
3. Sickle and knife (6 no’s)
1,200
180
15
1,020
867
737
626
532
4. Gloves(5 no's)
1,500
225
19
1,275
1,084
921
783
666
a) Desktop( 2 no's)
60,000
9,000
750
51,000
43,350
36,848
31,320
26,622
b) printer(1)
15,000
2,250
188
12,750
10,838
9,212
7,830
6,656
c) Telephone(1)
2,500
1,237,57
9
1,796,07
9
375
31
2,125
1,806
1,535
185,63
7
202,39
2
Farming Equipments
Office equipments
Total
TOTAL
Aloe vera Juice
15,470
16,866
1,051,94
2
1,593,68
7
894,151
760,028
1,354,63
4
1,151,43
9
1,305
1,109
646,02
4
978,72
3
549,12
0
831,91
5
Page 30
ALOE VERA CULTIVATION AND JUICE
c) INVENTORY COST PROJECTION
PARTICULARS
MONTHLY
REQUIREMENT(kg)
PER
UNIT
COST
MONTHLY
COST
Year 1
Year 2
Year 3
Year 4
Year 5
Aloe seedling( ploy bag)
10000
10
100,000
100,000
100,000
100,000
100,000
100,000
Aloe juice Bottle(250, 500 and 1000ml)
2041
3
5,103
61,230
64,292
67,506
70,881
74,425
29,988
31,487
33,062
34,715
Cartoon
476
5
2,380
28,560
Cello tape
10
40
400
4,800
5,040
5,292
5,557
5,834
Fertilizers (trucks)
3
2,000
6,000
72,000
75,600
79,380
83,349
87,516
Neem oil cake
1000
43
43,000
516,000
541,800
568,890
597,335
627,201
Printed aloe plastic
100
3
300
3,600
3,780
3,969
4,167
4,376
1,285
1,349
1,417
1,488
821,785
857,874
895,768
935,556
Bottle cap
204
1
102.00
1,224
Total
13834
2,104
157,285
787,414
d) MANPOWER COST
Human Resource REQUIREMENT
PARTICULARS
Manager
Marketing and sales person
Accountant
Workers
Watchman
Part time workers
No of required people
1
1
1
4
1
3
TOTAL
11
Monthly Salary
15,000
13,000
13,000
30,000
7,500
9,000
87,500
Yearly
180,000
156,000
156,000
360,000
90,000
108,000
1,050,000
e) LOAN PAYMENT
Interest
Principal
ending balance
Aloe vera Juice
Year 1
182,903
229,266
1,280,304
Year 2
334,159
490,178
1,019,392
Year 3
115,242
296,926
722,466
Year 4
74,257
337,912
384,554
Year 5
27,614
384,554
(0)
Page 31
ALOE VERA CULTIVATION AND JUICE
f) TOTAL OPERATIONAL EXPENSES
PARTICULARS
YEAR 1
YEAR 2
YEAR 3
YEAR 4
YEAR 5
Purchases (inventory & others)
787,414
821,785
857,874
895,768
935,556
Freight-in
25,000
Direct labor
360,000
396,000
435,600
479,160
527,076
Indirect Expenses (electricity)
3,000
3,150
3,308
3,473
3,647
1,175,414
1,220,935
1,296,781
1,378,401
1,466,279
10,000
10,200
10,404
10,612
10,824
Salary & Allowances
582,000
640,200
704,220
774,642
852,106
Commissions
5,000
5,100
5,202
5,306
5,412
Delivery expenses
10,000
10,200
10,204
10,204
10,204
Depreciation
202,392
232,751
267,663
307,813
353,985
2,000
2,000
2,000
2,000
2,000
334,159
115,242
74,257
27,614
5,000
5,100
5,202
5,306
5,412
Permits and licenses
1,700
1,734
1,735
1,735
1,735
Professional fees
20,000
Rent/lease
640
640
640
640
640
Telephone
5,000
5,100
5,102
5,102
5,102
Travel
2,000
2,040
2,041
2,041
2,041
Vehicle expenses
1,000
1,020
1,020
1,020
1,020
Cost of Goods Sold:
Less:
Ending Inventory
Total Cost of Goods Sold
Expenses:
Advertising
Amortization
Bad Debts
Bank Charges
Contract labor charges
Credit card fees
Dues and subscriptions
Insurance
Interest
Maintenance
Miscellaneous
Office expenses
Operating supplies
Payroll taxes
Wages
108,000
118,800
130,680
143,748
158,123
total
954,732
1,369,044
1,261,355
1,344,425
1,436,218
Total Expenses
2,130,146
2,589,978
2,558,137
2,722,826
2,902,497
Monthly expenses
177,512
215,832
213,178
226,902
241,875
Aloe vera Juice
Page 32
ALOE VERA CULTIVATION AND JUICE
3. FINANCIAL ANALYSIS
a) PROJECTED INCOME STATEMENT
INCOME STATETMENT PROJECTION FOR 5 YEARS
Revenue
Cost of Goods Sold
Gross Profit
Expenses
Net Operating
Income
Tax deduction
Net Income (Loss)
YEAR 1
YEAR 2
YEAR 3
YEAR 4
YEAR 5
1,175,414
4,423,200
1,220,935
4,644,360
1,296,781
4,876,578
1,378,401
5,120,407
1,466,279
(1,175,414)
3,202,265
3,347,579
3,498,177
3,654,128
954,732
1,369,044
1,261,355
1,344,425
1,436,218
(2,130,146)
1,833,222
2,086,223
2,153,752
2,217,910
(639,044)
549,967
625,867
646,126
665,373
(1,491,102)
1,283,255
1,460,356
1,507,626
1,552,537
b) PROJECTED CASHFLOW STATEMENT
Projected Cash Flow Statement
Year 1
Year 2
Year 3
Year 4
Year 5
646,959
(1,847,774)
(390,779)
1,535,501
3,515,406
Accts. Rec.
Collections
-
442,320
464,436
487,658
512,041
Loan Proceeds
1,509,570
Sales & Receipts
-
3,980,880
4,179,924
4,388,920
4,608,366
Total Cash Inflows
1,509,570
4,423,200
4,644,360
4,876,578
5,120,407
2,156,529
2,575,426
4,253,581
6,412,079
8,635,813
Advertising
10,000
10,200
10,404
10,612
10,824
Delivery
10,000
10,200
10,204
10,204
10,204
Insurance
2,000
2,000
2,000
2,000
2,000
Interest
-
334,159
115,242
74,257
27,614
Inventory Purchases
787,414
821,785
857,874
895,768
935,556
Office
5,000
5,100
5,202
5,306
5,412
Beginning
Cash Balance
Available
Cash Balance
Aloe vera Juice
Payroll
1,050,000
1,155,000
1,270,500
1,397,550
1,537,305
Rent or Lease
640
640
640
640
640
Taxes & Licenses
1,700
1,734
1,735
1,735
1,735
Utilities & Telephone
5,000
5,100
5,102
5,102
5,102
Other:
144,000
130,110
142,251
155,588
170,243
Subtotal
2,015,754
2,476,028
2,421,153
2,558,761
2,706,635
Capital Purchases
1,988,549
Loan Principal
-
490,178
296,926
337,912
384,554
Page 33
ALOE VERA CULTIVATION AND JUICE
Subtotal
1,988,549
490,178
296,926
337,912
384,554
Total Cash Outflows
4,004,303
2,966,205
2,718,080
2,896,673
3,091,189
Ending Cash
Balance
(1,847,774)
(390,779)
1,535,501
3,515,406
5,544,624
c) PROJECTED BALANCE SHEET
Projected Balance Sheet For 5 Years
Year 1
Year 2
Year 3
Year 4
Year 5
(1,847,774)
-
(390,779)
442,320
1,535,501
464,436
3,515,406
487,658
5,544,624
512,041
-
-
-
-
(1,847,774)
51,541
1,999,937
4,003,064
6,056,664
1,593,687
1,354,634
1,151,439
978,723
831,915
(254,087)
1,406,175
3,151,376
4,981,787
6,888,579
(873,150)
(1,543,432)
321,595
2,442,647
4,689,083
(690,247)
1,280,304
1,280,304
590,057
(1,543,432)
1,019,392
1,019,392
(524,040)
321,595
722,466
722,466
1,044,061
2,442,647
384,554
384,554
2,827,201
4,689,083
(0)
(0)
4,689,083
646,959
646,959
646,959
646,959
646,959
(1,491,102)
1,283,255
1,460,356
1,507,626
1,552,537
(844,143)
1,930,214
2,107,315
2,154,585
2,199,496
(254,087)
1,406,174
3,151,376
4,981,787
6,888,579
Assets
Cash & Bank
Accounts Receivable
Inventory
Prepaid expenses
Other Current Assets
Total Current Assets
Net Fixed Assets
Other Assets
Total Assets
Liabilities & Capital
Accounts Payable
Taxes Payable
Payroll Taxes Payable
Accrued Interest
Unearned Revenue
Short-Term Notes Payable
Short-Term Bank Loan
Payable
Total Current Liabilities
Long-Term Notes Payable
Total Long-Term Liabilities
Total Liabilities
Owner's Equity
Net Profit
Total Capital
Total Liabilities & Capital
Aloe vera Juice
182,903
Page 34
ALOE VERA CULTIVATION AND JUICE
d) VALUE ADDITION AND UNIT COST OF PRODUCTION
VALUE ADDITION
Year 1
Year 2
1,228,340
2,144,421
787,414
821,785
35.90
61.68
Monthly
Cost of production
Raw materials cost
Value addition
Monthly
Total units
Cost of production
Unit cost of
production
Year 3
1,860,206
857,874
53.88
Year 4
2,000,905
895,768
55.23
Year 5
2,155,633
935,556
56.60
UNIT COST OF PRODUCTION
Year 1
Year 2
Year 3
81,480
85,554
1,228,340
2,144,421
1,860,206
Year 4
89,832
2,000,905
Year 5
94,323
2,155,633
26
22
23
22
e) NET PRESENT VALUE AND IRR
Particular
Discount rate
Initial investment
Net cash flow year 1
Net cash flow year 2
Net cash flow year 3
Net cash flow year 4
Net cash flow year 5
NPV
IRR
Amount
10%
(2,156,529)
(1,491,102)
1,283,255
1,460,356
1,507,626
1,552,537
639,385
16%
f) PAY BACK PERIOD
year
Cash inflow
cumulative cash inflow
Payback period
Aloe vera Juice
0
Number of years
1
2
3
4
5
(2,156,529) (1,491,102) 1,283,255 1,460,356 1,507,626 1,552,537
(2156529) (3647631) (2364376) (904019)
603607 2156144
3.60
Page 35
ALOE VERA CULTIVATION AND JUICE
g) BREAK EVEN ANALYSIS
Time
Unit
Increment
Unit start
month
-
20,000
Unit Cost
Variable
Unit Price
54
36
Total Fixed
Costs
1,796,079
fixed
total cost
net
income
1,796,079
1,796,079
(1,796,079)
357,632
1,796,079
2,524,161
(1,067,997)
1,456,164
715,265
1,796,079
3,252,242
(339,915)
3,257,143
2,184,245
1,072,897
1,796,079
3,980,324
388,167
4,342,857
2,912,327
1,430,530
1,796,079
4,708,406
1,116,248
100,000
5,428,571
3,640,409
1,788,162
1,796,079
5,436,488
1,844,330
120,000
6,514,286
4,368,491
2,145,795
1,796,079
6,164,570
2,572,412
140,000
7,600,000
5,096,573
2,503,427
1,796,079
6,892,652
3,300,494
160,000
8,685,714
5,824,655
2,861,060
1,796,079
7,620,733
4,028,576
180,000
9,771,429
6,552,736
3,218,692
1,796,079
8,348,815
4,756,658
200,000
10,857,143
7,280,818
3,576,325
1,796,079
9,076,897
5,484,739
220,000
11,942,857
8,008,900
3,933,957
1,796,079
9,804,979
6,212,821
BREAK EVEN
X
BREAK EVEN
Y
LABEL
100,443
5,452,620
break even unit =100443
units
sales
variable cost
-
-
-
20,000
1,085,714
728,082
40,000
2,171,429
60,000
80,000
Aloe vera Juice
contribution
margin
Page 36
ALOE VERA CULTIVATION AND JUICE
BREAK EVEN ANALYSIS
sales
fixed
total cost
break even unit =100443
14,000,000
12,000,000
10,000,000
8,000,000
6,000,000
4,000,000
2,000,000
-
50,000
100,000 150,000
units
200,000
250,000
20 ANNEXURE II- CONSTRUCTION COST
Construction Cost for production house including office
Unit
Particulars
Units Requirement
Amount
Cost
CGI Sheet 10ft(in no)
80
915
73,200
Sand (in truck)
1
15,000
15,000
Stone (in truck)
Cement (in bags)
Gravel (in truck)
Miscellaneous cost (Paints,
electrical, etc.)
Labor cost
2
10
2
15,000
300
15000
30,000
3,000
30,000
50,000
175,000
TOTAL AMOUNT
Particulars
Sand (in truck)
Timber(buckle cft)
Stone (in truck)
Cement (in bags)
Miscellaneous cost
Labor cost
Construction Cost for Guard House
Units Requirement
0.5
40
0.5
10
TOTAL AMOUNT
Aloe vera Juice
376,200
Unit Cost
10,000
70
10,000
300
Amount
5,000
2,800
5,000
3,000
5000
22,500
43,300
Page 37
ALOE VERA CULTIVATION AND JUICE
Labour Cost for the Construction of Production hall including office
Wage Per
Required No. of labor No. of Working Days
Day
Total Wage
10
50
350
175,000
Labour Cost for the Construction of guard house
Wage Per
Required No. of labour No. of Working Days
Day
Total Wage
5
10
450
22,500
Initial land preparation
land preparation(Grass
removing)
aloe seedling planting
Number of workers
Number of
days
Wages
Total budget
15
10
15
5
350
300
78,750
15,000
93,750
Note:
 The roof of the semi-permanent building will be built with only CGI Sheet and MS
Truss.
 The wall of the production house will be made by Buckle (timber).
Aloe vera Juice
Page 38
ALOE VERA CULTIVATION AND JUICE
Aloe vera Juice
Page 39
ALOE VERA CULTIVATION AND JUICE
21 PROJECT TIMELINE
PROJECT TIME LINE
Activities
Ja
n
Fe
b
Ma
r
Ap
r
Ma
y
2015
Ju Ju
n
l
Au
g
Se
p
Oc
t
No
v
De
c
Feasibility study and
development of the project
proposal
Submission of Project
proposal
Release of fund from BOiC
Start construction works
Installation of machines
and plant
Recruitment and training
of staff
Start of the production and
its sale
Note: Production will be on a regular basis.
Aloe vera Juice
Page 40