GREEN
BIOPLASTIC
PROPOSAL
DATE \@ "MMMM d" \* MERGEFORMAT
May 2
Authored by: Mohamad Asyraf
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Mohamad Asyraf Bin Mohd Amin
+60139039245
[email protected]
Ts. Dr. Mohamad Faiz bin Mohd Amin
+601132690788
[email protected]
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Executive summary
Plastic waste contributes to ecological devastation and issues in human health. In 2017,
it is estimated that there are more than 8.3 billion metric tons (Mt) of plastics that have
been produced since the 1950s.In 2015, only nine percent of plastics have been
recycled, 12 percent incinerated, and 79 percent accumulated in landfills or in the
oceans. If this trend continues, it is expected that roughly 12,000 Mt of plastic waste
will be in landfills or the natural environment by 2050. The global plastic industry today
is considering alternatives, especially the use of more sustainable materials like
bioplastic which is a plant-based alternative made from renewable materials like starch
from corn, potato, soy protein, cellulose, and lactic acid. The use of plants makes
bioplastic more Earth-friendly products.
“Every year minimum 17.2% increment of exporting
demand on bioplastic product”
Oil palm trunk
There are currently over 1300 plastic manufacturers in Malaysia, producing over
RM30 Billion of revenue, half of which are exported. Half of this production is for
single used plastic. With increasing pressure from the government and consumers for
better plastic alternatives, these manufacturers are facing the hard decision of closing
In 1911, oil palm was exploited as a crop, and the first oil palm estate was established in 1917.The
down,
total notarea
planted because demand
with oil for plastic
palm in 1975 is decreasing,
was 641,791 butitbecause
hectares, and has beenof the higher
extremely cost in
expended
associated
2009 with bioplastic
with 4.7 million resin,
hectares with 2.49making it almost(50.09%)
million hectares impossible to survive.
in Peninsular Malaysia, 1.36 million
hectares (29%) in Sabah and 840,000 hectares (17.91%) in Sarawak showed in Table 2.2. In 2012, total
planted area conscience
With this with palm oilin
increase
mind,3.35% to 4.9 million
ZSR VORTICES Sdnhectares to 2.55 million
Bhd planned hectareson
to capitalize (52.01%),
the new
1.43 million hectares (29.04%) in Sabah and 1.04 hectares (18.94%) in Sarawak. Total planted area
wave of the global need for biodegradable products by investing in the production of
with palm oil increase to 5.2 million hectares, 1.4 million hectares in Sabah and 1.16 hectares in
Bio-Resin including plastic end product for local and international clients
Sarawak. From the statistics has been made by MPOB and Department of Statistic Malaysia, the oil
palm plantation in Malaysia is rapidly increasing from year to year.
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Oil palm trunk process structure
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Figure above shows that two option for raw material processing. The first option is where all process
is doing on own. This will cost higher initially because more machine needs to setup compare to buy
direct from supplier. But on raw material cost will be lower as current price is rm500 per tons for
wood chips.
Oil palm trunk that been chopped
Wood palm chip
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Wood chip that transported from plantation
Bioplastic Resin process
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Overall process of plastic resin
The manufacturing of resin activities shall focus on producing bio-resins that 100% bio degradable
and bio compostable. Separate plant operation is introduced due to environmental control on end
product basis. This is important for certificate especially on food and beverages related sector.
For resin, in targeting our production-output of 100Mt a month, the total revenue earning is
estimated at RM3, 400,000 per month or RM20, 800,000 per year.
Machine cost
Asset Quantity unit Unit value value Energy
breakdown (usd) consumption
Wood chipper 1 unit 20,000 20,000 90 kwh
dryer 1 unit 15,000 15,000 10 kwh
Hammer mill 2 unit 12,000 24,000 90 kwh
shiver 2 unit 4,000 8,000 2 kwh
palletizer 2 unit 80,000 160,000 110 kwh
Financial model of resin production
PLASTIC RESIN TYPE PRODUCT PRODUCED ESTIMATED RAW COST/kg
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Injection Molding Cutlery, meal set, household 12.52
Blown Molding Grocery bag, biohazard bag, 18.00
garbage bag, agriculture bag
Straw Drinking straw, Boba straw 15.65
Thermoforming Drinking cup, cup lid, meal box 17.00
Bioplastic resin from oil palm trunk
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END PRODUCT
1. INJECTION MOULDING
Injection moulding is a method to obtain moulded products by injecting plastic materials molten by
heat into a mould, and then cooling and solidifying them.
The method is suitable for the mass production of products with complicated shapes and takes a
large part in the area of plastic processing. Injection using two important element pressure and heat,
it depends on based formulation used. Usually one batch of injection is about 8 second including
cooldown temperature.
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Injection molding machine
Machine cost
Asset Quantity unit Unit value value Energy
breakdown (usd) consumption
Injection 2 unit 30,000 60,000 34 kwh
machine
Moulding 5 unit 3,000 15,000 -
Product that can be produced
Item Wight Per Unit Product cost estimation
cutlery 3g/pc 0.048/pc
Food container 15g/pc 0.158/pc
Drinking cups 3g/pc 0.058/pc
Revenue model
Biodegradable cutlery
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• The biodegradable cutlery producing machine can produce 3, 949, 000 pieces working at a 8 hours
per day and 24 day per month of the production capacity
• Current market for biodegradable cutlery is as high as RM0.09 per piece
• Taking into account at a more conservative estimate of RM0.07 per biodegradable cutlery, the
company revenue per month for cutlery is RM 276,430 working 8 hours a day for 6 days a
week.
Biodegradable food container
• The biodegradable food container producing machine can produce 394,971 pieces working
at a 8 hours per day and 24 day per month of the production capacity
• Current market for biodegradable food container is as high as RM0.60 per piece
• Taking into account at a more conservative estimate of RM0.50 per biodegradable food
container, the company revenue per month for meal box is RM 197,485.50 working 8 hours
a day for 6 days a week.
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Biodegradable mealbox
Biodegradable mealbox
Biodegradable drinking cups
• The biodegradable Drinking cups producing machine can produce 592,457 pieces working at an 8
hours per day and 24 day per month of the production capacity
• Current market for biodegradable drinking cups is as high as RM0.45 per piece
• Taking into account at a more conservative estimate of RM0.25 per biodegradable cup, the
company revenue per month for cup is RM 148,114.25 working 8 hours a day for 6 days a week.
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Biodegradable Cups
2. Blown Molding
One of the most common methods of film manufacture is Blown Film (also referred to as the Tubular
Film) Extrusion. The process involves extrusion of a plastic through a circular die, followed by
"bubble-like" expansion.
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Blown film line
Machine cost
Asset Quantity unit Unit value value Energy
breakdown (usd) consumption
Blown film 2 unit 25,000 50,000 60 kwh
machine
Grocery/ 2 unit 39,500 79,000 11kwh
garbage bag
machine
Product that can be produced
Item Wight Per Unit Product cost estimation (RM)
Grocery bag 5g/pc 0.092/pc
Garbage bag 6g/pc 0.112/pc
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Revenue model
Biodegradable Grocery bag
• The biodegradable grocery bag producing machine can produce 2,304, 000 pieces working at a 8
hours per day and 24 day per month of the production capacity
• Current market for biodegradable grocery is as high as RM0.25 per piece
• Taking into account at a more conservative estimate of RM0.15 per biodegradable grocery bag, the
company revenue per month for bag is RM 345,600 working 8 hours a day for 6 days a
week.
Biodegradable grocery bag
Biodegradable Garbage bag
• The biodegradable garbage bag producing machine can produce 5,068, 800 pieces working at a 8
hours per day and 24 day per month of the production capacity
• Current market for biodegradable garbage bag is as high as RM0.52 per piece
• Taking into account at a more conservative estimate of RM0.40 per biodegradable garbage bag, the
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company revenue per month for garbage bag is RM 2,027,520 working 8 hours a day for 6 days a
week.
Biodegradable garbage bag
3. Drinking Straw
A drinking straw is a utensil that is intended to carry the contents of a beverage to one's mouth.
Straws are commonly made from plastics, but environmental concerns and new regulation has led to
rise in reusable and biodegradable straws. These straws are often made of silicone, cardboard, or
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metal. A straw is used by placing one end in one's mouth and the other in a beverage. Straw
manufacturing requires several steps. First, the plastic resin and other components are mixed
together; the mixture is then extruded in a tube shape; the straw may undergo subsequent
specialized operations; and finally, the straws are packaged for shipment.
Straw making machine
Machine cost
Asset Quantity unit Unit value value Energy
breakdown (usd) consumption
Straw making 2 unit 33,100 66,200 2 kwh
machine
Straw 2 unit 6,000 12,000 0.8kwh
packaging and
printing
machine
Product that can be produced
Item Wight Per Unit Product cost estimation (RM)
Normal drinking straw 0.4g/pc 0.037/pc
Boba drinking straw 0.7g/pc 0.045/pc
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Revenue model
Normal drinking straw
• The biodegradable drinking straw producing machine can produce 20,736,000 pieces working at a 8
hours per day and 24 day per month of the production capacity
• Current market for biodegradable straw is as high as RM0.15 per piece
• Taking into account at a more conservative estimate of RM0.10 per biodegradable straw, the
company revenue per month for bag is RM 2,073,600 working 8 hours a day for 6 days a
week.
Biodegradable Drinking straw
4. Thermoforming
Thermoforming is a plastic molding technique that results in a variety of highly usable products.
During this manufacturing process, thin plastic sheets are heated in order to make them easy to
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manipulate. Once a sheet reaches a pliable temperature, it is formed over a male or female mold.
After being cooled to a finished shape, the end product is trimmed in order to increase its usability.
Thermoforming machine
Machine cost
Asset Quantity unit Unit value value Energy
breakdown (usd) consumption
Thermoforming 2 unit 40,500 81,000 80 kwh
machine
printing 2 unit 4,000 8,000 2 kwh
machine
Product that can be produced
Item Wight Per Unit Product cost estimation (RM)
Drinking cup 13 g/pc 0.22/pc
Meal packaging 41 g/pc 0.69/pc
Revenue model
Biodegradable drinking cup
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• The biodegradable drinking cup producing machine can produce 1,382,400 pieces working at a 8
hours per day and 24 day per month of the production capacity
• Current market for biodegradable cup is as high as RM0.09 per piece
• Taking into account at a more conservative estimate of RM0.08 per biodegradable cup, the
company revenue per month for bag is RM 110,592 working 8 hours a day for 6 days a
week.
Drinking Cup
Biodegradable meal box
• The biodegradable drinking cup producing machine can produce 806,400 pieces working at a 8
hours per day and 24 day per month of the production capacity
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• Current market for biodegradable cup is as high as RM0.45 per piece
• Taking into account at a more conservative estimate of RM0.35 per biodegradable cup, the
company revenue per month for bag is RM 282,240 working 8 hours a day for 6 days a
week.
Biodegradable meal box
CaPex Investment (List of Proposed Factory Assets)
A. Hard Cost
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Table 1. Hard cost expenditure with list of equipments and factory setup.
Asset breakdown Qty Unit Unit value Rm mill
1.Palletizer 2 Unit 330,400 0.661
2. wood dryer 1 Unit 61,950 0.062
3. hammer mill 2 Unit 49,560 0.099
4.Wood sieve 2 Unit 16,520 0.033
5.Wood chipper 1 Unit 82,600 0.083
Total raw material processing machine (a) 0.938
1.Injection molding 2 Unit 123,900 0.1239
2. product molding 5 Unit 12,390 0.0619
Total injection molding end product (b) 0.1858
1.Blown film machine 2 Unit 103,250 0.2065
2.Grocery/garbage bag machine 2 Unit 163,135 0.3263
Total Blown molding end product (c) 0.5328
1.straw machine 2 Unit 136,703 0.2734
2.Packaging and printing machine 2 Unit 24,100 0.0496
Total Blown molding end product (d) 0.323
1.thermoforming machine 2 Unit 167,265 0.3345
2.printing machine 2 Unit 33,040 0.0330
Total Thermoforming end product (e) 0.3675
1.installation and commission 20% Total 294,160 0.2942
machine
2.trial run production 1 unit 120,000 0.1200
3.research and development machinery 1 unit 110,000 0.1100
Acquisition cost (f) 0.5242
Total hard cost (THC) determined by total raw material machine(a)+ Acquisition cost+
option of end product (b),(c),(d), or (e)
THC (b)= a+b+e = 1.648 (RM mill)
THC (c )= a+c+e= 1.995 (RM mill)
THC (d)= a+d+e= 1.829 (RM mill)
Highest value of cost been used for estimation
Office equipment and factory cost not included in cost
Machine cost can be reduced by buying local machine.
B. Soft cost
breakdown Qty Unit Unit value Rm mill
1.Trade secret policies document 1 Unit 2,000 0.002
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2. IP- Trademark search 1 Unit 200 0.0002
3. IP- Trademark Company 1 Unit 950 0.0009
4.Green batch SIRIM 1 Unit 25,000 0.025
5.ISO9001 1 Unit 7,000 0.007
6.ISO14001 1 Unit 10,000 0.010
7. Halal Cert 1 Unit 7,000 0.007
Total Soft cost (TSC) 0.1232
C. Total Development cost
Total Development cost = Hard cost + Soft Cost
Highest Value of Hard cost used for estimation
TDC= 1.995+0.1232=2.1182 (RM mill)
Direct Variable cost
Based on 30 tons of bioresin produced
Item Qty Price per unit Total (RM)
Opt powder 9,000 0.5 4500
Plasticizer 18,000 19 342,000
Additive 3,000 25 75,000
Transportation 10 75 750
Electricity 1 40,000 40,000
Total 462,250
Direct Fixed cost
Direct Fixed Cost (DFC) or factory overheads include salary of staff in the production line and all
expenses related.
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Direct Fixed cost Qty Unit cost Monthly
Salary- Plant manager 1 6,000 6,000
Salary- Qa/Qc 1 3,500 3,500
Salary- Technical Executive 1 2,800 2,800
Salary- Technician 1 2,100 2,100
Salary- Rnd Engineer 1 3,000 3,000
Salary- Supervisor 1 1,800 1,800
Salary- Storekeeper 1 1,400 1,400
Salary- Operator 10 1,300 13,000
Total 33,600
Indirect Fixed cost
Indirect Fixed Cost (IFC) includes 1) Salary of the Management and Administrative staff.
Indirect fixed cost Qty Unit Cost Monthly
BOD Allowance 5 10,000 50,000
Salary- Management 2 7,000 14,000
Salary- Admin and Hr manager 1 6,000 6,000
Salary- Procument 1 2,100 2,100
Salary- accounting 1 2,500 2,500
Salary- Sales executive 2 2,100 4,200
Salary- clerk 1 1,300 1,300
Total 80,100
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Cashflow
12 months starting on first month of sale
1 2 3 4 5 6 7 8 9 10 11 12 TOTAL
Opening cash balance 0 -1507590 -896980 -286370 324240 934850 1545460 2156070 2766680 3377290 3987900 4598510 17000060
CASH INFLOW:
Sales 1186560 1186560 1186560 1186560 1186560 1186560 1186560 1186560 1186560 1186560 1186560 1186560 14238720
TOTAL CASH INFLOW 1186560 -321030 289580 900190 1510800 2121410 2732020 3342630 3953240 4563850 5174460 5785070 31238780
CASH OUTFLOW:
Capex 2118200 0 0 0 0 0 0 0 0 0 0 0 2118200
Direct Variable cost 462250 462250 462250 462250 462250 462250 462250 462250 462250 462250 462250 462250 5547000
Direct fixed cost 33600 33600 33600 33600 33600 33600 33600 33600 33600 33600 33600 33600 403200
Indirect fixed cost 80100 80100 80100 80100 80100 80100 80100 80100 80100 80100 80100 80100 961200
TOTAL OUTFLOW 2694150 575950 575950 575950 575950 575950 575950 575950 575950 575950 575950 575950 9029600
Ending cash balance -1507590 -896980 -286370 324240 934850 1545460 2156070 2766680 3377290 3987900 4598510 5209120 22209180
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