1. Product Description: PVC foot wears are shoes and sandals made from PVC granules-the basic input for making many types of plastic products. These foot wears are light in weight and relatively inexpensive. They are used by low income people.
2. Rationale: Until recently the Amhara Region was importing all its PVC foot wears (plastic shoes and sandals) from Addis Ababa and from foreign countries. New there is at least one plastic shoe making plant in Bahir Dar and this plant meets some of the plastic shoe demand of the Region. However, there is still a gap between regional production of plastic shoes and demand and this is still met by imports. All the sandal requirement of the Region is met by imports. Most urban people of the Region use sandals. In fact in cities like Bahir Dar, people wear sandals outside their homes while the custom has been to wear sandals at homes. Probably they are relatively cheaper; many students in the urban centers wear sandals when they go to school. The rural people will start using sandals increasing the demand for the product. To increase the degree of self-sufficiency in the production of basic consumer goods, the Region should promote the establishment of PVC foot-wears especially sandals making plant.
3. Market Potential: Currently the major consumers of PVC foot wears especially sandals are the urban people of the Region. In 2006, the urban population of the Amhara Region is estimated to be about 2.2 million. If a quarter of the population uses sandals, a one-time demand for sandals will be 550,000 pairs. Sandals last for about 3 months. Hence annual demand can reach as many as as 2.2 million. This indicates the potential demand for sandals even with restrictive assumptions.
SUPPLY OF PLASTIC FOOTWEARES
SOURCE: Compiled from CSA’s Manufacturing Data for Different Years.
* Estimated
4. Source of Raw Material: Imported.
5. Process & Technology: PVC granules are used for making plastic shoes and sandals. The main process of making these products is by injection/compression moulding. Main machine required include injection moulding machines, and different sizes and designs of moulds for different shoes and sandals.
6. Estimated Investment: For a plant which can produce 500 pairs a day, the estimated investment is :-
§ Building/Share 150m2 at Birr 1500/m2 = Birr 225,000
§ Machinery = Birr 150,000
§ Working Capital = Birr 180,000
555,000
7. Benefits: Saves foreign exchange, and regional financial resources, improves self-sufficiency of the Region.
8. Location: Combolcha.