Whenever you’re taking a Decision to establish a Mineral Water Plant, obviously few questions will come to your mind like :
- What is the Profit Margin?
- How much is the investment?
- How much is the ROI (Return on Investment)?
- What are the Risk Factors?
- How to minimize the Risk Factors?
Now I will attempt to answer these questions as follows.
1. What is the Profit Margin ?
There is a separate page on this site called “plant layout.”You can get a table below the Layout which explains the cost of production & profit margin.
2. How much is the investment?
The investment truly depends upon the type of plant & the Capacity of plant. Let me explain this in details.Some people may look at a prosperous Jar Market, at the same time some other may feel that they should go for bottles, jars & Pouches. Some of you may feel that they will start with just bottle filling. Empty Bottles bought out where as some will want to have complete bottle making set as well.
So the decision of “ Which type of Plant” Truly depends upon your targeted Market segments. Once you decide what to have in your product mix, you can decide the machinery and other things. Buy the Training Course to get an idea of how to decide the plant Capacity.Now to arrive at the Mineral Water Plant Cost, These are the elements which are combined each other.
Machinery & Equipment
All machines like Water Treatment, Bottling, Lab equipment etc. will come under this.
- Utilities : Water Electricity Air Conditioning, air Compressor etc.
- Liaison Expenses : ISI License & other Government License expenditure.
- Consultancy Charges : Like ISI Consultancy project funding etc.
- Building Cost : Construction, interior cost
3. How much is the ROI (Return on Investment)?
Usually , if the business is run professionally, the invested money will be returned to the investor by the business in 3.5 years. So you can say that ROI is 30 % per annum.
4. What are the Risk Factors ?
After working closely in this industry, I have observed that the TOP risk factor in this business is Improfessional Management of the business. I will highlight main elements in this :-
(a) Execution Failure :-
Such a plant calls for detailed steps to get executed in time, with detailed clear-cut duties explained. If not, there is a mess of things & plant fails to get executed in time, in turn you will be left with LOSSES.
(b) No Proper Co-ordination :-
After you finalize the plant supplier, failing to do a proper co-ordination with him is the major reason. Non-appointment of a Project Guy OR not maintaining schedules will result in delay in execution
(c) No Documentation :-
People go by intuition, without doing proper study on what they have to sell, what market they have, how are they going about it etc. And they do not keep any documentation about this. Then misunderstandings, and all……
(d) Absence of Parallel execution system :-
- It means , at a time you will need to carry out various cycles, absence of this will again increase project period.
- Inside our Training Course ,we offer a Project Planning Ebook which clarifies you these concepts
(e) Habit of doing everything on your own :-
Keep in mind, you are a businessman, and a businessman delegates, does not do everything. As an entrepreneur, your job is to get people, tools. And giving the tools to the best people who are going to do that.
5. How to minimize the Risk Factors ?
I know, 100 % risks can’t be avoided, but can be reduced to a great extent, no doubts. Here is how you can do it :-
A. Invest in EDUCATION. Just keep eyes around you, there are many people conducting courses in Packaged Drinking Water Business from time to time. Keep an eye on that.Even we also do have a Training Course on Packaged Drinking Water.The course is fully online, has a great content.The best part is:-It’s delivered through mail,so you can learn at your own pace. Check the contents here.
B. Do a proper project execution plan- step by step. Prepare an excel sheet, note down all duties, steps etc, who to do what, what date etc. If you do not want to spend time and need readymade steps for a packaged drinking water plant, we also have an execution plan software, it is included in the course above mentioned. But you can see a video demo of the course over here.
C. Read this article on what 5 steps you can take to avoid the risks involved in a packaged drinking water plant .
It is advisable to properly study the market, then appoint best possible turn key project consultant.