DEVELOPMENT BANK OF ETHIOPIA

RESEARCH AND PROJECT DATAMANAGMENT

DIRECTORATE
UPDATED RAW DATA AND INFORMATION ON SOFT
DRINKS MANUFACTURING

Prepared By:

Mekonnen fekadu loan Officer

Anteneh Beziye Sr. market research Officer

Revised By:

Anteneh Mulugeta Team Manager

Million jarso Technical Team Manager

Approved By: commodity and market research Approval committee

Jan, 2023

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 TABLE OF CONTENTS

1. INTRODUCTION................................................................................................................................1

1.1. Background of the document................................................................................................................1

1.2. Objectives of the Document.................................................................................................................1

1.3. Methodology.........................................................................................................................................1

1.4. Scope and limitation.............................................................................................................................2

1.4.2. Limitation.............................................................................................................................................2

2. COMMODITY DESCRIPTION..........................................................................................................3

2.1. Definition of Carbonated soft drinks....................................................................................................3

2.2. Classification of Carbonated Soft Drink..............................................................................................3

3. RAW MATERIALSTUDY..................................................................................................................1

3.1. The Required Raw Materials and Inputs...........................................................................................1

3.2. Demand and supply of major raw materials.....................................................................................5

3.2.1. Demand for sugar and carbon dioxide...........................................................................................5

3.2.2. Supply of sugar and carbon dioxide..............................................................................................5

3.3. Supply of raw materials from Import................................................................................................6

3.4. Purchase Source of Raw Materials and Inputs..................................................................................7

3.5. Utilities..............................................................................................................................................7

3.6. Packaging Materials..........................................................................................................................7

3.7. Marketing Arrangements..................................................................................................................8

3.8. Raw materials and Inputs Purchase Price Trend...............................................................................8

4. PROCESS FLOW AND REQUIRED MACHINERY.........................................................................9

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 4.1. Carbonated Soft drinks Technical Study...........................................................................................9

4.2. Required Machineries and Equipment’s.........................................................................................14

5. MARKET STUDY.............................................................................................................................16

5.1. Market segmentation..........................................................................................................................16

5.2. Carbonated Soft Drink (CSD) Market in Ethiopia.............................................................................16

5.2.1. Demand for Carbonated soft rink.......................................................................................................16

5.2.2. Supply of carbonated soft drink..........................................................................................................17

5.3. Marketing strategies, channels and arrangements..............................................................................17

5.4. Price trend and Current price of soft drinks.......................................................................................19

6. PROBLEMS, CONSTRAINTS, RISKS, SUCCESS FACTORS, AND OPPORTUNITIES...........20

7. PARAMETERS, TECHNICAL COEFFICIENTS AND ASSUMPTIONS.......................................21

7.1. Basic Assumptions..............................................................................................................................21

7.2. Revenue Estimation............................................................................................................................21

7.3. Investment Cost..................................................................................................................................22

7.4. Operational expenses..........................................................................................................................24

7.5. Working capital...................................................................................................................................28

REFERENCES.....................................................................................................................................................29

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 LIST OF TABLE
Table 3-1: Domestic production of sugar and Carbon dioxide (CO2)...................................................................5
Table 3-2: Import trend of concentrate under Hs code 330210.............................................................................6
Table 3-3: Purchasing sources raw materials and inputs.......................................................................................7
Table 4-0-1 List of processing equipment’s and Machineries Required For Carbonated Soft Drink Production
by Glass Bottle and PET......................................................................................................................................14
Table 5.2.1-1: Ethiopian total Population 2013/14 to 2018/19............................................................................17
Table 5.2.2-1: Domestic Production of Carbonated Soft Drink...........................................................................17
Table 7.2-1: Factory gate selling price (Average price) before VAT..................................................................21
Table 7.2-2: Conversion factor.............................................................................................................................21
Table 7.3-1: Vehicle requirements.......................................................................................................................22
Table 7.3-2: Machinery and Equipment required for CSD production................................................................22
Table 7.4-1: Raw material purchase price with VAT..........................................................................................24
Table 7.4-2: Purchase Price for Uniform.............................................................................................................26

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 1. INTRODUCTION

1.1. Background of the document

Carbonated soft drink industry is among beverage industry that plays its own role in economic
development. Carbonated soft drink is preferable to all age groups, particularly more consumers
(around 70%) are age groups below 35 (source: field survey, 2020). Following change in
consumers’ behavior from time to time due to improvement in their income and way of life in
general, demand for carbonated soft drink also change positively (Carole Veitch, 2016).

Currently, numbers of industries are producing carbonated soft drink in Ethiopia; Moha Soft Drink
S.C, Zebym Trading PLC, East Africa Bottling S.C, and others. Having their own specific brand
and quality to attract customers and get market share, new soft drink companies are emerging
and/or existing soft drink companies are expanding. To increase the pace of such emergence
and/or expansion of carbonated soft drink industries including other industries, DBE as
government financial institution is meant to provide both financial and technical support based on
viability of prospective project. Hence, this document data is aimed to facilitate such support
activity of the DBE through provision of relevant and up-to-date data.

1.2. Objectives of the Document

The main objective of this document is to meet the expectation of the DBE concerned units and
decision makers through provision of comprehensive and relevant raw data and information;
thereby enable them to make an appropriate decision.

1.3. Methodology
Primary data were collected through dispatched questionnaires, interview and field visit. On the
other side, secondary data were gathered from internet, publication of various governmental
organizations.

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 1.4. Scope and limitation

1.4.1. Scope

The scope of the study is manufacturing and marketing of carbonated soft drinks in Ethiopia.

1.4.2. Limitation

The main limitation of this document is some operational firms were not willing to provide
information and data regarding their firms’ products and conversion related data.

2
 2. COMMODITY DESCRIPTION

2.1. Definition of Carbonated soft drinks

A carbonated soft drink is a drink that usually contains carbonated water a sweetener, and a
natural or artificial flavoring. The sweetener may be a sugar, high-fructose corn syrup, fruit
juice, a sugar substitute or some combination of these. Soft drinks may also contain caffeine,
colorings, preservatives, and/or other ingredients.

2.2. Classification of Carbonated Soft Drink

Carbonated soft drinks can be classified in several ways, for example, on the basis of their
sugar and fruit juice content, flavoring, carbonation level, main non water ingredients, and
functionality. The classification could also be made on the basis of soft drink types: (i) ready-
to-drink essence-flavored beverages; (ii) ready-to-drink beverages containing fruits or fruit
juice; (iii) beverages ready-to-drink after dilution. Functional drinks are a rapidly growing
subsector of the market and include drinks enriched with juices, vitamins, and minerals; sports
and energy drinks; wellness drinks and nutraceuticals. Many functional drinks have been
developed to provide specific medical or health benefits, such as promoting heart health,
improving immunity and digestion, and helping to boost energy. The target markets for
functional beverages are diverse, and products are often tailored towards particular target
markets, for instance, according to age and gender, with a growing focus on children, and
women.

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 3. RAW MATERIALSTUDY
In this section, the raw materials and inputs required for the manufacturing of carbonated soft
drinks are identified. The sources of the raw materials are also considered in this section.
3.1. The Required Raw Materials and Inputs

Required raw materials and inputs could vary as per specific brand or business strategy of the
founder. The health effect of the final product (in this case, carbonated soft drink) could also be
considered as a factor that determines the type and quantities of raw materials and inputs used.
Specific characteristics of the product can be attained with fewer lists of raw materials as a result
of those specific characteristics of the materials. For instance, ZEBYM soft drinks use variety of
health beneficial domestic herbs (e.g. Moringa leave, Hibiscus leave, etc.) to extract concentrate
that satisfies other chemical requirements such as antioxidant and others. Given, such variations
from industry to industry, list of required materials and inputs presented below.
Direct raw materials:-
 Concentrate  flavor
 Sugar  Carbon dioxide
 Citric acid  Water

Preservatives:-
 Sodium benzoate
 Potassium benzoate
Antioxidants:-
 Common salt
 Calcium chloride
Water treatment Chemicals:-
 Activated carbon for sugar
 Calcium hypochlorite
Washer (bottling) chemicals:-
 DivoNp  Caustic soda
 Divi LE  DivoBrite

1
Sugar purification chemicals
 HyfloSupercel
Packing Materials:-
 Crown cork,
 Plastic case,
 PET perform with cap , and
 Glass bottle and labeling materials
Utilities:-
 Electricity
 Water

3.2. Demand and supply of major raw materials

3.2.1. Demand for sugar and carbon dioxide

The major demanders of sugar include food and beverage industries, cafeteria and hotels, and
households; and demand for Carbon dioxide mainly comes from beverage industries.
3.2.2. Supply of sugar and carbon dioxide

Supply of sugar is both from domestic production and import; while supply of carbon dioxide is
only from domestic production. Past five years data for sugar is presented in table below but no
complete data reported for carbon dioxide production.
Table 3-1: Domestic production of sugar and Carbon dioxide (CO2)

Year Sugar production (in tons) CO2 Production (in tons)

2012/13 274,621 11
2013/14 284,848 689
2014/15 336,866 -
2015/16 132,596 -
2016/17 196,313 -
Source: CSA, Production of Major Manufactured Articles 2012/2013 (2005 E.F.Y) -
2016/2017(2009 E.F.Y)

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 3.3. Supply of raw materials from Import
Raw materials like concentrate are also imported from foreign market. For the last five years
Ethiopia import concentrate from Ireland, South Africa, India, China, Egypt, Turkey, Spain
United kingdom and Netherlands.
Table3-2: Import trend of concentrate under Hs code 330210

2018 2019 2020 2021 2022

Exporters
Imported Imported Imported Imported Imported
quantity, Tons quantity, Tons quantity, Tons quantity, Tons quantity, Tons

World 1501 1891 1418 1618 1582

Ireland 1038 1419 830 827 787

Egypt 167 71 85 266 274

China 43 78 93 199 189

India 63 100 105 137 167

South Africa 35 69 139 81 92

Türkiye 42 32 47 12 20
United Arab
Emirates 7 6 3 4 15

Spain 28 21 45 35 11

Netherlands 26 28 13 9 10
United
Kingdom 19 23 15 15 8
Source: ITC Trade Map

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 3.4. Purchase Source of Raw Materials and Inputs
According to the survey data, the source of raw materials and inputs required for the
manufacturing of carbonated soft drinks area valuable from both local sources and/or abroad.

Table3-3: Purchasing sources raw materials and inputs

Description Purchasing sources
Domestic Import
A. Direct and indirect raw materials and inputs
Concentrates*  (e.g. from local herbs) 
Sugar  
Carbon dioxide 
Water 
Acidulates(citric acid) 
flavour 
Clour 
Preservative 
Antioxidants 
Chemicals  
B. Packaging materials
Crown cork 
Plastic Case 
Glass Bottle  
Pet perform with cap 
Labeling materials 
Source: surveyed CSD factory

*Remark: The usage of concentrate for CSD requires strict assurance from concerned
government body. Concentrate in CSD is sourced mostly from known companies by franchising
it

3.5. Utilities
In order to run the operation n the existence of utilities like water and electricity is crucial. Water
is used for mixing of raw materials and staff of the organization.

3.6. Packaging Materials

Packaging materials like plastic case, glass bottle, closure, crown cork and label are used for
packing final products which can purchased from domestic market through order base from local
factory.

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 3.7. Marketing Arrangements
Marketing arrangement of materials and inputs is an agreement made between the two parties’
i.e. the seller and buyer, about the means of transportation, ownership transfer and other legal
agreement. It enables to specify which party (buyer or seller) pays for which shipment and
loading costs, and/or where responsibility for the goods is transferred. For those materials
imported from abroad, there are two types market arrangement in general. The first is a direct
purchase from the producer themselves. The second option is from the brokers of foreign
countries who buy from the main suppliers and sell it to the manufacturers. On the other hand the
market arrangement for these materials is order base and the payment is based on L/C system.
For those raw materials purchased from local market the modality of payment is on cash bases.
Generally as a summary the modality of payment to purchase locally available raw materials is
on cash bases whereas modality of payment for imported materials is international method of
payment by opening L/C.

3.8. Raw materials and Inputs Purchase Price Trend

Due to absence of price trend data, only current purchase of raw materials and inputs is stated in
the parameter parts of the document.

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 4. PROCESS FLOW AND REQUIRED MACHINERY
4.1. Carbonated Soft drinks Technical Study
The production of carbonated soft drink (CSD) has the following main production sections;
Syrup preparation section

Sugar

Water Sugar dissolving jacketed vessel

Activated carbon and filter aid

Raw syrup

Water Syrup Filter Spent Activated carbon and filter aid

Filtered syrup

Syrup cooler

Cooled syrup

Ingredient pre mixer Syrup vessel

Final syrup

Precision filter/strainer

Final To proportioner

Figure 4.1: Syrup preparation section process flow

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 The proportioning, carbonation and filling section

Final syrup

Proportional vessel
Chilled Water Carbon dioxide

Carbonated beverage

Spent water
Filler and sealer
Cork or cup

Washed
bottle
Bottle washer
Inspecting machine

bottle Pet Bottle hoper

te with bottle Bottle de-crater

products
Glass bottle

Date coder

Crate
Pet bottle products
Pet blow molding
Crate washer Pet preform
Labels Labeler

Shrink rapper for pet bottle

Final product

Figure 4. 2: Proportioning and filling section process flow

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Water treatment section

Raw water from bore hole or tap

Chlorine
Water storage tank

Sand Filter

Carbon filter

Process water for boiler and sanitation

Polishing filter

Water for syrup preparation

Ultra filter
Deionizer

Reverse osmosis filter

Water to process washing and boiler feed preparation

UV (ultra violet) defecting

Water to syrup preparation and final beverage preparation

Figure 4. 3: Water treatment Section Process flow

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Carbon dioxide production section

Fossil fuel (diesel oil)

Burner equipped in the boiler

Flue gas form boiler burner

Soda ash Soda Scrapper

mia Absorbsion tower

Stripper Mia

Water condenser Water

ppm separator

Carbon dioxide compressor

Carbon dioxide dryer

Activated carbon filter

Carbon dioxide refrigerator compressor Condenser

Carbon dioxide evaporator

To carbonation process

Figure 4. 4: Carbon dioxide production from flue gas process flow

Clean in place (CIP) system
Figure 4. 1: Clean in place (CIP) System

4.2. Required Machineries and Equipment’s

Table 4-0-4List of processingequipment’s and Machineries Required For Carbonated Soft Drink Production by
Glass Bottle and PET

S/N Unit Process or Machinery required Purpose (Application)

operation
A. Process machineries common for carbonated soft drink production by Glass bottle and PET battle
1 Sugar dissolving vessel Stainless still vessel equipped To dissolve the sugar with filter aid and
with agitator activated carbon

2 Syrup filter Fitter machine to remove foreign materials(impurities),

3 Syrup cooler Cooling machine To cool the syrup heated during
dissolving
4 Ingredient pre mixer Stainless still vessel equipped To mix the ingredients
with agitator

10
5 Syrup vessel (mixing and Stainless still vessel equipped To mix the sugar with ingredients and
maturation vessel) with agitator water
6 Water chiller Water Chilling machine
7 Proportioning and Consists of mixing vessels and To mix the syrup, water and carbon
carbonation system different injection systems dioxide
B. Machineries for PET bottle packaging
1 PET Preform blow molder To produce pet bottle
machine
2 Mono block PET Filling Filling machine To wash, rinse, fill and seal the filled
machine bottle
3 Bottle Labeling for pet Pressure-Sensitive Labeler, labeling
bottling Rotary Labeler
4 Shrink rapping machine for Packaging of the product
pet bottle packing
5 Case Packing "drop packers" and "pick and Packaging of the product
place packers
6 conveyers To transport the bottle from one unit
operation to the other
C. Machineries for glass bottle packaging
1 Case un-packer To pick up the return bottle from the case
feed to the washer
2 Return glass bottle washer To wash the return glass
machine
3 Glass bottle filler machine To fill the soft drink
4 Case Packing "drop packers" and "pick and Packaging of the product
place packers
5 conveyors To transport the bottle from one unit
operation to the other
D. Utility and auxiliary machines
1 Carbon dioxide production Carbon dioxide recovery plant Carbonation of the soft drink
plant
2 Boiler Boiler machine For process heating
3 Refrigerator plant Chilling machine To cool the process water
4 CIP(clean in point) Cleaning tanks and machines For cleaning and disinfecting the process
lines
5 Compressed air Compressors For instrumentation of machineries and
blow molding the pet
6 Water treatment plant Water treatment plant To purify the water to required standard

7 Waste water treatment Waste water treatment plant To treat the waste water
plant
8 Electricity Supply National grid, and Generator To run the whole plant

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 5.MARKET STUDY

5.1. Market segmentation

Market experience of carbonated soft drink in Ethiopia shows supply from local production with
insignificant import quantity and no export practice. Hence, market segment for carbonated soft
drink is domestic market.

5.2. Carbonated Soft Drink (CSD) Market in Ethiopia

5.2.1. Demand for Carbonated soft rink

There are varieties of carbonated soft drink products, say, in terms of sugar content, flavor content,

12
 and others specific parameters. Accordingly, demanders’ preference varies. Age is the main factor
that affects demand for CSD. Young adulthoods are the primary targets for CSD marketing, as
there is strong demand for CSDs within this segment (approximately 70% of age group below 35).
People above this age are demanding a little amount of CSD, as these groups becoming
increasingly health cognizant and more prone to illnesses such as diabetes. Apart from this fact,
sometimes demand might come from all age group of people based on specific characteristics of
the product.

Given age of people as main factors that affect demand, there are a number of determinants that
determine carbonated soft drink demand. Demand for CSD is mainly depend on level of
population size, disposable income of consumers and urbanizations, price of the product, and
season (e.g. demand for CSD might increase during dry season and vice versa).

Considering population size among other determinants, with increase in population size, so does
the demand for carbonated soft drinks. According to latest United Nations data, Ethiopia
population data estimation includes the following:-

 The current population of Ethiopia in 2023 is 126,527,060, a 2.55% increase from 2022.
 The median age in Ethiopia is 18.8 years (2023)
 Currently, 22.1 % of the population of Ethiopia is urban (27,959,894 people in 2023)

Table 7.1: Projected Population (In '000s) Of Ethiopia by Variant and Urban Population,2007-37
Year Total population Urban population
Medium High Low Population Percentage

2007 73,845 73,845 73,845 11,874 16.1

2012 83,742 84,040 82,974 15,246 18.2
2017 94,352 95,223 92,309 19,164 20.4
2022 105,166 106,983 101,490 23,880 22.8
2027 115,946 118,959 110,405 29,311 25.4
2032 126,514 130,875 119,074 35,488 28.2
2037 136,792 142,577 127,460 42,388 31.1

Source: CSA

5.2.2. Supply of carbonated soft drink

13
 The supply of CSD in Ethiopia comes from domestic production, while imported items are few
and of insignificant volume. Therefore supply is equals to domestic production. There are number
of companies engaged in production of carbonated soft drink in Ethiopia; Moha Soft Drinks S.C,
East Africa Bottling S.C, asku plc

As shown in CSA report and information obtained from Food, Beverages and Pharm+aceuticals
Industry Developments Institute carbonated soft drink annual production increased from
428,937,700 liters in 2014 to 760,278,603 liters in 2019. Regarding designed and actual
production capacity of operating companies, the institute revealed that currently there is no
organized data that shows annual designed and actual production capacity of companies. But
carbonated soft drink production data for the past six years indicated in table below.

Table 5.2.2-5: Domestic Production of Carbonated Soft Drink“HL”

Descripti 2019
on 2014 2015 2016 2017 2018
CSD 428,937,7 350,997,0 405,203,7 465,984,2 535,881,8 760,278,6
00 00 00 55 93 03

Source: CSA and Food, Beverage, pharmaceuticals Industry Development Institute, and field survey, 2020

5.3. Marketing strategies, channels and arrangements

Marketing strategy for CSD companies include aspiration for continues business growth by
serving customer needs using feasible marketing channels [mainly both direct marketing (direct
sales – e.g. door to door selling) and indirect marketing (through agents and/or depot system)] at
desired time, quality and affordable price.

In door to door distribution, the products are supplied at every customer door; this system is
applied for customers found nearby from a factory.

In depot system depots are selected from big cities nearby the factory, agreements are signed
between the factory and owners of the depot, unit selling price of depots is fixed in the contractual
agreement, a factory supply the product at depot get and a depot is distributing products for
different customers. Depots are working as marketing partner of a factory by making: customer

14
 need assessment, market development work and etc; and report to a factory which helps a factory
to act according to customer need.

Agent system is mostly used to reach customers at large distances from a factory. Strong and
financially capable agents at big cities far away from a factory are selected by the factory; agents
purchase products at factory get and transport to their warehouse by their own or rental heavy
trucks with thriller.

The marketing arrangements (sales) are made mostly on cash basis, sometimes credit sales for one
month is also possible.

CSD Factories

Door to door
Agents Depots
distribution to
every customer

Hotels, Hotels,
Retailers Unversties, Retalirs
Unversties,
Hospitals, Hospitals
Groceries Groceries
and etc and etc
Consumers Consumers

Figure 5. 1: Marketing channel of carbonated soft drinks in Ethiopia

5.4. Price trend and Current price of soft drinks

The price trend of the products is not available as result the current price is depicted in the
parameter part of the study.

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 6.PROBLEMS, CONSTRAINTS, RISKS, SUCCESS FACTORS, AND OPPORTUNITIES

Problems, Constraints, and Risk factors are external factors that are outside the control of the
business owner, but significantly have impact on the business. Whereas, Success factors and
exploitation of existing Opportunities are under the control of the business owner and should be
followed in order to make the business successful:
Problems Constraints
 Production below designed capacity due to  Foreign exchange shortage
raw materials supply shortage  Lack of separate policy and guideline that
 Inflation effect encourages Carbonated Soft Drink
 Selling of new product in regions where producers (for companies using major
formerly soft drink products exist is raw materials from domestic country).
challenging (e.g. coca cola soft drinks, and For example, support in terms of reducing
Moha Soft drinks) excise tax, availing sufficient financial
 Frequent power failure support, etc.

Risk Factors Opportunities and Success Factors

Success factors:-
 Political instability, and
 Professional management,
 Pandemic disease – Covid-19
 Technology selection, and
 Others
Opportunities:-
 Growing market demand,
 Population growth, and
 Fast economic growth

16
 7.PARAMETERS, TECHNICAL COEFFICIENTS AND ASSUMPTIONS

This part of the study is devoted on the assessment of the coefficients and parameters, which are to
be used on the determination of costs and revenue in the production of carbonated soft drinks. The
very important caution which has to be taken by the users of this data is that the parameters and
prices determined are just indicatives, which help understand where the real parameter lays.

7.1. Basic Assumptions

 Working days per annum ………….………………………….........270
 Working days per week ………………….…………………………6
 Number of shift in a day ……………………………………………2
 Working hours per shift …………………………………………….8

7.2. Revenue Estimation

Table 7.2-6: Factory gate selling price (Average price) before VAT

Product Selling Price Unit of

Measurement
CSD with glass bottle 142.61 Case
12 pcs of 0.5lt 144.87 Pack
CSD with 6 pcs of 1lt* 192.0 Pack
PET bottle 6 pcs of 1.5lt* 217.0 Pack
12 pcs of 350ml** 144.0 Pack
Source: Moha Soft Drinks S.C and East Africa Bottling S.C. &Zebym Trading PLC
NB: 1case =24 glass bottles (each glass bottle has 300ml holding capacity)

7.2.1. Conversion factor/input-output relation

Table 7.2-7: Conversion factor

Components Typical use level

Water Up to 85-90 in the normal condition but 98% v/v when high-
intensity sweeteners are used
Sugars 7–12% m/v
Carbon dioxide 0.3–0.6% m/v
Acids 0.05–0.03% m/v
Concentrated flavor up to 0.5% m/m
Colors 0–70 ppm(mg/liter)
Preservatives 250 ppm(mg/liter)
Antioxidants <100 ppm (mg/liter)

17
 Type of chemical use level
Chlorine 4-7 ppm (0.0000039954 to 0.000006992 Kg per liter)
Citric acid 0.00036 kg per case (0.00005 Kg per liter)
Fumadose 0.0000488 ml per case (0.0000068 ml per litter)
Caustic soda 0.1602 kg per case (0.0223 Kg per litter)
Trisodium phosphate 0.0004878 ml per case (0.000068 ml per litter)
Divo 0.00138 kg per case (0.00019 kg per liter)
Source: Previous Carbonated Soft Drinks Document, 2020
NB: the chemical use level can differ based on the technology selection and production capacity.
ppm-----Part per Million
m/m----- Mass per Mass
m/v------ Mass per volume
7.3. Investment Cost
 Vehicles
Table 7.3-8: Vehicle requirements
Type of vehicle Purpose
Service vehicles For employees service
Medium vehicle For door to door sales
Heavy Trucks For delivery of products and collection of inputs

Small vehicles for administration

Forklift For loading and unloading of products
Source: Previous Carbonated Soft Drinks Document, 2018
NB: Vehicle requirement is varied based on the size of the factory
 Machinery and equipment
Table 7.3-9: Machinery and Equipment required for CSD production

S/ Unit Process Machinery required Purpose (Application)

N or operation

A. Process machineries common for carbonated soft drink production by Glass bottle
and PET bottle

1 Sugar dissolving vessel Stainless still vessel To dissolve the sugar with filter
equipped with agitator aid and activated carbon

2 Syrup filter Fitter machine to remove foreign

materials(impurities),

3 Syrup cooler Cooling machine To cool the syrup heated during

18
 dissolving

4 Ingredient pre mixer Stainless still vessel To mix the ingredients

equipped with agitator

5 Syrup vessel (mixing Stainless still vessel To mix the sugar with ingredients
and maturation vessel) equipped with agitator and water

6 Water chiller Water Chilling

machine

7 Proportioning and Consists of mixing To mix the syrup, water and

carbonation system vessels and different carbon dioxide
injection systems

B. Machineries for PET bottle packaging

1 PET Preform blow To produce pet bottle

molder machine

2 Mono block PET Filling Filling machine To wash, rinse, fill and seal the
machine filled bottle

3 Bottle Labeling for pet Pressure-Sensitive labeling

bottling Labeler, Rotary Labeler

4 Shrink wrapping Packaging of the product

machine for pet bottle
packing

5 Case Packing "drop packers" and Packaging of the product

"pick and place packers

6 conveyers To transport the bottle from one

unit operation to the other

C. Machineries for glass bottle packaging

1 Case un packer To pick up the return bottle from

the case feed to the washer

2 Return glass bottle To wash the return glass

washing machine

3 Glass bottle filler To fill the soft drink

machine

4 Case Packing "drop packers" and Packaging of the product

19
 "pick and place packers

5 conveyors To transport the bottle from one

unit operation to the other

D. Utility and auxiliary machines

1 Carbon dioxide Carbon dioxide Carbonation of the soft drink

production plant recovery plant

2 Boiler Boiler machine For process heating

3 Refrigerator plant Chilling machine To cool the process water

4 CIP(clean in point) Cleaning tanks and For cleaning and disinfecting the
machines process lines

5 Compressed air Compressors For instrumentation of

machineries and blow molding
the pet

6 Raw Water treatment Water treatment plant To purify the water to required
plant standard

7 Waste water treatment Waste water treatment To treat the waste water
plant plant

8 Electricity Supply National grid, and To run the whole plant

Generator

Source: Technical part of this document, 2020

7.4. Operational expenses

Raw materials and inputs purchase price

Table 7.4-10:Raw material purchase price with VAT

Description Price in birr UoM

Major Raw materials
Concentrate Pepsi concentrate A 74,320.48 Unit
Pepsi concentrate A 1,854.72 Unit
Miranda concentrate M1 24605.78 Unit
Miranda concentrate D1 896.08 Unit

20
 Miranda Citric acid Dry 456.99 unit
7 up flavor 24,692.61 Unit
7 up dry component 699.11 Unit
Miranda tonic flavor 24571.17 unit
Miranda tonic dry component 821.56 unit
Miranda apple flavor 29,098.01 unit
Miranda apple dry 399.86 unit
sugar 21.00 kg
Citric acid(acidulate) 55 kg
CO2 27 kg
Chemicals
Sodium benzoate 39 kg
Potassium benzoate 40 kg
Bottle washing chemicals

Caustic soda 45 kg
DivoBrite 153.06 liter
Divi LE 300.41 liter
DivoNp 268.84 liter
Water treatment Chemicals
Activated carbon for sugar 78 Kg
Calcium hypochlorite 173.2 Kg
Cleaning and Sanitation Chemical
Citric acid 55 Kg
Chlorine 70 Kg
Packing materials
Crown cork 0.265 Pcs
Plastic Case 239.42 pcs
Glass Bottle 8.9 pcs
Closure 0.38 pcs
Label 538.34 kg
PET pre form pet 24 gram 2.93 Pcs
pet 25 gram 2.9 Pcs
pet 37.3 gram 4.3 Pcs
pet 43 gram 4.95 Pcs
Poly sheet 155 Kg
Source: Field survey, 2021
*NB: The PDM Team Highly Recommends Using Three Comparable Preform Invoices While
Appraising.
Concentrate in CSD is sourced mostly from known companies by franchising it. Therefore, this critical
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aspect should be evaluated during this data usage.
→ Bottle breakage rate is 0.3%
According to Moha soft drinks company information concentrate, flavor and some materials are imported in
unit where it is unit of measurement by itself. According to information from Vietnam trade website one unit
is equivalent with
1 unit = 3918 kg
Source: https://www.vietnamtrades.com/vietnam-import-data/kg/hs-code-33/unit-unit.html
Overhead Expenses
 Travelling and Per diem Expense: The cost of travel and per diem is found to be on average
1.27% of annual salary.
 Medical expense: 5% of wage and salaries.
 Telephone, post & internet: on average 0.12% of annual sales.
 Promotion cost: on average 0.11% of annual sales.

Purchase Price for Uniform:-

Table 7.4-11:Purchase Price for Uniform

Description Price/unit (Birr) Unit of measurement

Cover all 507.75 Pcs
Over coat 426.50 Pcs
White overcoat 426.50 Pcs
Long dress aprons 567.50 Pcs
Jacket and trouser 895.00 Pair
Shirt and trouser 736 Pair
Chemical mask 2,200 pcs
Safety Google 135 Pcs
Hand glove 450 Pcs
Protection kit 60 Pcs

Source: Field survey, 2021

Utilities:-
 Water consumption:- as per the specification of machinery
 Electricity consumption:- as per the specification of machinery
 Fuel and Oil lubricants:
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Fuel and lubricant oil for vehicle depends on the distance purpose of the vehicles intended for. However the
Fuel cost:

a) For Automobile: 13-15 Km per litre

b) For Service Vehicle : 0.013559 lit/seat/km
c) The cost of oil and grease: 2% of fuel cost
d) For Truck:
Table 7.1: Truck fuel cost

Gross Pay Load Distance Fuel Fuel Consumption AVERAGE

Vehicle travelled in one Consumption per Km for each lit/km/ton
Weight liter per Km ton of load
7.5 TON 3.124 To 5.840 km/lit 0.171 lit/km 0.055 lit/km/ton 0.035
n
12 TON 6.311 ton 5.500 km/lit 0.182 lit/km 0.029 lit/km/ton
18 TON 10.198 ton 4.540 km/lit 0.220 lit/km 0.022 lit/km/ton
Source: Cross Cutting Project Supporting Data, 2019
 Repair and Maintenance
Table 7.2: Repair and Maintenance

Description Percentage of Original Value

Building and Construction 2% of original cost
Machinery & Equipment 5% of original cost
Furniture and Fixture 5% of original cost
Vehicles 5% of original cost
Generator 5% of original cost

 Depreciation and Amortization

Table 7.3: Depreciation and Amortization

Description Percentage of Original Value

Building and Construction 5% of original cost
Machinery & Equipment 10% of original cost
Furniture and Fixture 10% of original cost
Vehicles 20% of original cost
Generator 10% of original cost
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 Insurance
Table 7.4: Major Insurance Categories for the Firm

Description Types of Insurance

Building, Machinery Earthquake, flood, Fire and lightening
&equipments and Furniture
Vehicles Motors commercial and third party
Life insurance Working hrs and work man composition for employee and 24 hrs
personal and work team for managers
o For Insurance Premium refer to the “Cross Cutting Project Supporting Data, 2019
 Land Lease Cost
Refer to land lease agreement between the project and concerned office from where the land would be availed.

7.5. Working capital

Table 7.5: Working capital determination

Description Period (Months)

Raw material Import 4
local 1
Packing materials 1
Salary and Wages 1
Fuel and lubricant 1
Stationary and P.T.T 1
Travel and per diem 1
Insurance 12
Work in progress 2 days
Depends on advertising method
Advertising expense selected by the customer. For
advertising expenses please refer
updated cross cutting data.

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 REFERENCES

o Previous Carbonated Soft Drink Document, 2020

o Existing Operating Companies, Moha soft drinkc SC, Zebym soft drinks

o Central Statistical Agency, 2014 – 2018

o Ethiopian Revenue And Customs Authority

o Ethiopian food medicine and drugs control authority

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