4
The proposed Initiative to create an import substitution factory in South Africa for Poly Carbonate Plastic Sheeting Manufacturing
Miko Manufacturing is a greenfields operation through which it will produce and sell polycarbonate plastic sheeting
Miko Manufacturing is a greenfields operation through which Miko Manufacturing will produce and sell polycarbonate plastic sheeting via Miko No 141 to the construction industry.
It is an import substitution programme that will transfer skills and economic activity to South Africa
A total of 9 salaried and 30 direct staff positions will be created by this venture by year 4.
Facts
2008
| Two years ago: | 0 |
| Last year: | 0 |
| This year (forecast): | 0 |
| Year 2 (forecast): | 3,600,000 |
| Year 3 (forecast): | 4,500,000 |
| Two years ago: | 0 |
| Last year: | 0 |
| This year (forecast): | 0 |
| Year 2 (forecast): | 153,000 |
| Year 3 (forecast): | 335,000 |
| Two years ago: | |
| Last year: | 3 |
| This year (forecast): | 3 |
| Year 2 (forecast): | 15 |
| Year 3 (forecast): | 22 |
Finance needed
| Finance needed for fixed assets (buying of machines, buildings, ...) | 840,000 |
| Finance needed for working capital (salaries, stock, rental, leasing, transport, ...) | 365,000 |
| Total finance needed (US$) | 1,205,000 |
How do you expect this to be financed? Please note: the total amount mentioned here should be equal to the total finance needed at the previous question.
| Own Contribution in cash | 10,000 |
| Loans (debt) | 355,000 |
| Share capital that you seek from investors (equity) | 840,000 |
| Other sources | 0 |
| Total finance needed (US$) | 1,205,000 |
The Business
Strong, light, bright and attractive Makrolon ® polycarbonate sheeting is ideal for residential, commercial, industrial roofing and cladding applications where natural lighting may be required
Manufactured from high-tech, high quality Bayer Makrolon ® polycarbonate resin, Makrolon ® sheets combine remarkable clarity with incredible strength.
MIKO MANUFACTURING customer will be MIKO NO 141 and their customers are largely from the building sector. Lead time from the current supplier is unacceptable. Also see www.mikosheeting.co.za/index.html
The product will be made with an extrusion plant to be imported from China via a South African accredited sales and support organisation.
Extrusion will be through 6 different profiled dies specifically produced to suit South African and African requirements.
The company will sell its products via it partner, MIKO NO.141, who has started six years ago and is the sole agent for marketing the sheets imported from the Bayer manufacturing plant in Australia (Lazerlite). This agency covers all of Africa as well as the Indian Ocean islands. Miko no. 141 has been very successful with their vigorous sales drive and currently owns six sales offices in the major cities throughout South Africa.
MIKO MANUFACTURING major customer will be MIKO NO 141 and their customers are largely from the building sector but other sectors like the signage, and automotive sectors as well as all hot houses in the farming industry throughout Africa will be actively pursued.
Ampaglass and its subsidiary Modek are the only other competitors in South Africa that manufactures polycarbonate. The have old equipment and also manufacture a vast number of non polycarbonate products harming their operational efficiency.
Miko No 141 has claimed most of its current market share from this company and has an established customer base
It will use new technology and plant capable of meeting productive and quality requirements demanded by customers. The brand name from Bayer 'Makralon' will be used under an exclusivity agreement.
The industrial plant will allow for rapid tool changes and allow the company to run profitably with quick reaction and lead times to satisfy customers changing demands. The current team has tool design and manufacturing capability and different product features could be accommodated upon demand. Flexible and small production runs will ensure a competitive advantage in contract or tender based requirements.
Growth over and above normal expected growth rates for South Africa will be achieved by exports to the region and Africa in general.
Diversification in to the Automotive industry is possible.
The company is structured for flexibility and has the technology to rapidly adapt to customer preferences and changing demand patterns.
The Entrepreneur & Management
The team consists of 3 members. Fanie Pretorius, Budjix Kumardew and Francois Cloete. Fanie has extensive management experience and skills as CEO and COO of medium sized industrial businesses. Budjix is highly competent as a programme manager in the same sized business and Francois is a tool maker by trade with operational and technical skills and knowledge of the automotive and industrial sectors.
The team has financial management skills and via its subsidiaries extensive contact with customers in the emerging world.
It has a track record of establishing a similar sized company in South Africa and Jordan to date.
Lastly it has the experience and necessary academic qualifications required for this initiative.
It is estimated that a minimum of 20 hours per week of my time will be required but this may increase in all probability for the first year of operation. As much as needed will though be made available.
Development
Unemployment in South Africa is a major problem. Although a formal EIA has not been done, it will employ 39 staff directly associated with the business and the secondary effect cannot be over emphasised. Raw material consumes 60% of the cost which is imported. From the remaining 40% an estimated of 30% of the input and administration costs will be disbursed to local staff and suppliers.
The plant will also conform to international standards.
4 comments
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