1. Product Description: The word cosmetics refers to articles intended to be rubbed, poured, sprinkled or sprayed or introduced into or otherwise applied to the human body or any part of it for cleansing, beautifying, promoting attractiveness or altering the appearance. Generally, cosmetics can be divided into four groups: skin, nail, hair and teeth cosmetics. Skin cosmetics include face powder, talcum powder, vanishing cream, color cream, lipstick, cold cream, Vaseline. Nail cosmetics include nail polishes. Hair cosmetics covers hair dye, hair shampoo, coconut oil shampoo, shaving cream, hair fixer, after shave. Cosmetics for teeth include tooth powder and tooth paste. Different cosmetics require different ingredients and different preparation formulas.
2. Market Potential: The Amhara Region is home to 19.2 million people. In countries where the standard of living is high, 19.2 million people could have supported a multi-million dodder cosmetics industry. However, since the standard of living of the people in the Amhara Region is very low the market for cosmetics is limited to few brands like Vaseline, vanishing cream, cold cream, hair oils. These cosmetics products are widely used in the urban areas and to some extent in rural areas. Other cosmetics products such as tooth paste, nail polish, after shave, shaving cream, etc. are used by people of higher income in the urban areas of the Region. Women are the main consumers of many types of cosmetics products. Potential customers of cosmetics products in the Amhara Region are female between the age of 5 and above. The number of female in this age group in the Region is about 8 million of whom 11.5 percent or 921,000 live in urban areas. If we assume that at least 70 percent of the urban potential customers and 40 percent of the rural customers, total customers will be about 3.5 million. If on the average one consumer consumes about 400gm of cosmetics per year, annual aggregate consumption of cosmetics in the Region could be 1,400 tons. Up to now, all these cosmetics have been imported partly from Addis Ababa and partly from abroad. The purpose of this project is to substitute imports by regional production, and the regional demand is sufficient to absorb the production of a number of small scale cosmetics producing plants.
3. Source of Raw Materials: Different cosmetics use different types of inputs with varying proportions. Basically there are about 6 types of inputs which constitute the components of many types of cosmetics. These are waxes, fatty acids, vitamin zed oil, lecithin bentonite and petroleum jelly or vase lines. Depending on the type of cosmetics to be made, other inputs are also added to the basic ingredients. Some of the main inputs such as wax, fatty acids can be obtained from domestic sources; others have to be imported.
4. Process & Technology: The formulation and production processes of different groups of cosmetics are different. Hence, since there is no one common process for all cosmetics, no process description is given in this section. Machinery and equipment for cosmetics also differ based on the type of cosmetics to be produced. The following are the basic types of machines used for different categories of cosmetics. Heating equipment: electric heaters; boilers, steam stills, water baths and distilled water heat stills. Equipment for creams:- meters for waxes, greases and fats, mixers for waxes, greases, fats for milling and mixing operations. Equipment for liquids:- mixers, filters and filter presses, liquid filling machines of vacuum type, bottle capping machine. There are also different types of machines for powder cosmetics.
5. Estimated Investment: For a plant which will produce 300,000 bottles of vanishing cream, 5000kg of face powder, 12000kgs of scented coconut air, 300,000 bottles of shampoo, 120 ton of soap and 5000 tubes of toothpaste per year, total investment will be:
§ Building 1200 m2 at Birr 2500/m2 = Birr 3,000,000
§ Machinery = Birr 1,500,000
§ Working Capital = Birr 1,000,000
5,500,000
6. Benefits: Saves foreign exchange and regional financial resources, contributes to better health conditions of individuals, and introduces new skills and technology to the Region.
7. Location: Combolcha, Bahir Dar.