1L – 25 L HDPE Lubricant Container Production in Nigeria; The Feasibility Report.

HDPE stands for High-Density Polyethylene, which is a thermoplastic polymer derived from the monomer ethylene. High-Density Polyethylene (HDPE) packaging is used in industries such as food and beverage, pharmaceuticals, and consumer goods.

High-Density Polyethylene (HDPE) has various properties including resistance to chemicals, durability, moldability which make its ideal for application in various types of packaging containers, bottles, cartons, bags, and others. In addition, its capability to extend the shelf life of the product stored within it and inert natures are some of the additional properties, which make it an ideal material for packaging.

Increasing demand for convenient and packed food and beverage products globally is one of the major driving factors of the global High-Density Polyethylene (HDPE) packaging market. In addition, availability of HDPE packaging products in various colors aid to product differentiation, and adding the aesthetic look to products which expected to drive growth of the target market.

Increasing demand for High-Density Polyethylene (HDPE) bottles for packaging pharmaceuticals including tablets, and other related products is a factor expected to augment the global market growth. In addition, rising online shopping is further impacting growth of global High-Density Polyethylene (HDPE) packaging market positively.

Ongoing research and development activities regarding completely recycle High-Density Polyethylene (HDPE) packaging products is a factor expected to create a positive impact on growth of the target market.

However, fluctuating raw material prices and availability of better substitutes like Low-Density Polyethylene (LDPE) may hamper growth of the target market.

The global High-Density Polyethylene (HDPE) bottles market is projected to expand at a compound annual growth rate (CAGR) of three point one percent (3.1%) by the end of 2028. The High-Density Polyethylene (HDPE) bottles market is segmented on the basis of cap type, bottle capacity, visibility, product type, end-user industry, and barrier type.
Plastic have played a vital role in the growth phase of the Nigerian economy and continue to do so. From packaging to agriculture, automobiles and electronics plastics have revolutionized all areas because of its functionality, economics, aesthetics and reliability.

Plastic have made all products affordable to the Nigerian consumer and have helped in raising the lifestyle of the common man. Consequently, a lot more products manufactured in Nigeria today either contain plastics or are contained in plastics.

Small size plastic containers are used for packing of drugs, pharmaceuticals, insecticides, food items etc. The plastic blow moulded containers are made from High-Density Polyethylene (HDPE), High molecular weight high density polyethylene (HMHDPE), Low-Density Polyethylene (LDPE), Polypropylene (PP) etc. Blow moulded plastic containers are finding great demand in modern era.

This report is to examine the financial viability or otherwise of establishing a plastic container (jerry can) production plant in Nigeria using High-density polyethylene (HDPE) resins and master batch (for colour) as the raw material. Though there are lot of products can be manufactured by blow moulding technology, we intend producing one (1) Litre, four (4) Litres and twenty-five (25) Litres High-density polyethylene (HDPE) plastic containers for the lubricant oil industry.

The proposed plant comprises of two (2) sets of double station five (5) L High-density polyethylene (HDPE) plastic containers (jerry cans) plant that can produce 1L – 5L containers and one (1) single Station twenty-five (25) L High-density polyethylene (HDPE) plastic containers (jerry cans) plant that can produce twenty-five (25) Litres containers.

The output of the machine is a function of the capacity as well as the thickness of the product to be produced. Because of the different thickness of the product that can be produced for use in different industries, we would provide insight on the household and lubricant oil market for the product.

The lubricant market requires the following sizes and minimum thickness one (1) Litre – seventy (70) grams weight, four (4) Litres – two hundred and forty (240) grams and twenty-five (25) Litres – one point four (1.4) kilogrammes while the household market requires the following sizes and minimum thickness five (5) Litres – one hundred and fifty (150) grams, ten (10) Litres – three hundred (300) grams, twenty-five (25) Litres – seven hundred and fifty (750) grams and fifty (50) Litres – one thousand, five hundred (1,500) grams.

Not only are the weight containers used in the lubricant market higher, they are also more expensive than the products in the household market.

Each plant comprises of extrusion blow molding machine, auto-loader, chiller, crusher, compressor, mixer and molds. Other auxiliary machine includes leakage tester, in-mould labeler etc

The plant would operate at seventy-five percent (75%) of the installed capacity for double (2) shifts of eight (8) hours per day in the first, second, third, fourth and fifth year of operations respectively for three hundred (300) working days per annum.

Table of Contents

EXECUTIVE SUMMARY 1.0    Business Overview 1.1 Description of the Business 1.2 Vision and Mission Statement 1.3 Value Proposition 1.4 Critical Success Factor of the Business 1.5 Current Status of Business 1.6 Description of the Business Industry 1.7 Contribution to Local and National Economy 2. Marketing Plan 2.1 Description of product 2.2 Product delivery 2.3 The Opportunity 2.4 Pricing Strategy 2.5 Target Market 2.6 Distribution and Delivery Strategy 2.7 Promotional Strategy 2.8 Competition 3. Production Plan 3.1 Description of the Location 3.2 Raw Materials 3.3 Production Equipment 3.4 Production Process 3.5 Production Cost 3.6 Stock Control Process 3.7 Pre-Operating activities and expenses 3.7.1 Operating Activities and Expenses 3.8 Project Implementation Schedule 4.0 Organizational and Management Plan 4.1 Ownership of the business 4.2 Profile of the promoters 4.3 Key Management Staff 4.3.2 Management Support Units 4.4 Details of salary schedule 5. Financial Plan 5.1 Financial Assumption 5.2 Start -up Capital Estimation 5.3 Source of Capital 5.4 Security of Loan 5.5 Loan Repayment Plan 5.6 Profit and Loss Analysis 5.7 Cash flow Analysis 5.8 Viability Analysis 6.0 Business Risk and mitigation factor 6.1 Business Risks 6.2 SWOT Analysis

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