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Author
Participant
  • Nature Challenge 2009

    Boosting businesses on sustainable use of natural resources in Mozambique & Kenya

  • The plan application has been submitted for assessment.

  • The full business plan documents have been submitted for assessment.

 
Business start-up

Fencing Posts From Recycled Post Consumer Waste Plastic

We recycle post consumer waste plastic into aesthetic, durable and environmentally friendly plastic fencing posts

We are a manufacturing business located at Kariobangi Light Industries. We buy post consumer waste plastic from collectors, shred it and use an an extruder to produce a plastic fencing post. The posts are sold directly to customers through our sales team or indirectly through appointed stockists. We've invested US$ 10,256 for start up to acquire an extruder, conduct market research and secure a go-down for manufacturing & warehousing.

Facts

Legal status business
Formally registered
Year of establishment

2009

Sales (US$)
Two years ago: 0
Last year: 0
This year (forecast): 80,780
Year 2 (forecast): 151,995
Year 3 (forecast): 260,943
Net profit after tax (US$)
Two years ago: 0
Last year: 0
This year (forecast): 19,854
Year 2 (forecast): 56,863
Year 3 (forecast): 91,266
Total number of Employees
Two years ago: 0
Last year: 0
This year (forecast): 8
Year 2 (forecast): 14
Year 3 (forecast): 24

Finance needed

Finance needed for fixed assets (buying of machines, buildings, ...) 65,154
Finance needed for working capital (salaries, stock, rental, leasing, transport, ...) 19,231
Total finance needed (US$) 84,385

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 16,877
Loans (debt) 4,219
Share capital that you seek from investors (equity) 46,412
Other sources 16,877
Total finance needed (US$) 84,385

The Business

What is your product/service?

Our product is essentially a post made from recycled waste plastic. The posts come in different lengths ranging from 6 to 10 feet in length. 7 ft is the standard length in Kenya. The posts are also either circular, 2 to 4 inches in diameter, or square 2 to 4 inches cross-section. They are currently only available in black colour. We’ll sell the posts under the brand name EcoPost™ which we intend to register as a trademark of GBS.

What customer need/problem do your products/services satisfy?

Traditional fencing materials such as cedar posts have become scarce. Metal and concrete alternatives are expensive. Our posts offer affordability, aesthetics, durability and they are environmentally friendly.

How will you make the product/service?

We receive waste plastic from collectors and shred it to less than 5 mm sizes. This is the fed into a machine called an extruder where at high temperatures and pressures, the plastic is melted and forced into a mould cavity. The mould is then inserted into a water bath to cool and harden taking the configuration of the mould cavity. The hardened plastic is then removed from the mould and cut into appropriate sizes, becoming a fencing post.

Explain how you will sell your product/service (marketing strategy) and how you will reach your customers (distribution strategy)?

We'll market to institutional customers by visiting procurement managers, applying for the tenders,website and advertisements on newsprint & TV. We'll have stands, brochures, posters and fliers at relevant events such as the ASK agricultural shows and expos. We’ll distribute the posts through appointed stockists located in areas of high demand. After we have purchased our own vehicle we will be able to transport the posts to our customers.

To whom are you selling, what is your market?

We have segmented the market as residential, commercial and institutional. We'll target residential and institutional customers . These are more lucrative in terms of both volume and frequency of orders. E.g., KWS gave Kijabe Ltd an order of thousands of posts to fence the Abedare forest valued at millions of shillings. Also, the KAA posted a tender for more than 1,000 posts to fence the new runway in Kisumu valued at about KShs. 1 million.

Describe your competitors?

The industry is still in a state of flux, with few market leaders. Major players are Devani and Green Africa. Both companies have become extremely wealthy from sales of these posts. A1 plastic is a new entrant and begun operations in December 2009. Kijabe Ltd was a one time producer with a contract to supply the Kenya Wildlife Service to fence the Aberdare forest. It ceased operations when the contract was over to concentrate on flower farming.

What makes your business different/better than your competitors (competitive advantage)?

We'll offer coloured posts laced with UV stabilisers & flame retardants hence offer more quality. We'll sell our posts as a package with complementary products e.g barbed wire & price our posts competitively.

What makes your business, your product or service innovative?

Currently in Kenya thousand of plastic bags and bottles litter our streets, open fields and clog our sewers. Our business converts these unwanted wastes into a beautiful, durable, affordable, cost effective and environmentally friendly product. Our innovation is developing an alternative use to an otherwise unwanted waste product.

How will you ensure the growth of your business?

We intend to grow organically using our retained earnings. We'll grow by increasing manufacturing capacity and expanding into new product lines. We intend to purchase a larger extruder. We also intend to produce roofing trusses (a billion shilling industry), support beams for low cost housing and plastic lumber for furniture manufacture. The good this is that we are using the same process and same raw materials to produce these new products.

The Entrepreneur & Management

Describe the entrepreneur & management

I have a B.Com degree concentration in Accounting from Africa Nazarene University, Nairobi. I’m a performance-driven person with excellent accounting, organizational and marketing skills with a proven record of achieving targets and possessing ongoing successes by establishing new business generating ideas.

My partner is a process engineer with a 1st Class Honours, MEng degree in Biochemical Engineering from University College London, UK.

What specifically makes you and (if relevant) your management team most qualified to build this business?

My 5 years working experience in various organizations has enabled me to gain expertise in strategic planning, financial, business development, marketing and maximizing profits. My partner is an expert in project management, operations, forecast/planning, health & safety and quality assurance. We are confident that our skills are adequate to successfully run this business and drive revenue growth and build a solid client base for GBS Ltd.

How much time do/will you expect to spend per week in the business?

About 50 - 60 hours per week.

Development

How does your business improve the local living standards (social and environmental)?

According to our estimates we will employ 24 individuals by the 3rd year. At least half of those will be skilled and the others unskilled. In addition we'll create as many as 100 indirect jobs in the form of collectors and sorters of waste. In the long run, through reduced tree logging for timber posts, we'll contribute to retaining of our forest cover thus protecting our water catchment areas. We'll also promote food security since we'll have enough rainfall, promote energy security via electricity fom hydro sources and promote industrialization by employing appropriate technologies to deliver useful products to the society. Lastly we offer an alternative solid waste management solution.