1. Product Description:- Pencils are made from soft wood and lead. As everybody knows pencils are basic instruments for learning and for many types of office work such as writing, sketching, calculating, -----.
2. Rationale:- The soft wood which one of the basic raw materials for making pencils is found in the western parts of the Amhara Region especially along the Amhara- Beneshangul boarder areas. The Amhara Region is considered as the best and a project was to be implemented in the Bahir Dar by the previous government. So far, there is no a single factory which produces pencils in the whole country; but it has been confirmed that and opportunity exists for establishing a viable pencil making factory in the country. Since some parts of the Amhara Region have one of the major raw materials, it is logical that this project should be promoted and supported so that the Region should have the first pencil making factory in the country.
3. Market Potential:- The major groups of consumers of pencils are students. The 2.2 million students in the Amhara Region consume about 11 million pencils every year. If consumption by other people is assumed about 30 percent of the students’ consumption, total consumption in the Region could be as high as 14.3 million pencils. This is the market potential for pencils in the Amhara Region alone. It is easy to imagine the potential in the whole country. There is sufficient market for pencil to justify the establishment of a pencil making plant in the Region.
4. Source of Raw Material:- Lead will be imported and softwood will be obtained from some parts of the Region.
5. Production process & Technology:- Basically pencil making passes through three stages:- wood working process; preparation of the lead slip and lacquering and final treatment and finishing. These stages have sub- stages which include- grooving, gluing, and drying rough cutting, shaping, painting, fin cutting, stamping, painting and packing. Main plant and equipment include, slant sizing, grooving, shaping, coloring, cutting, stamping, gluing, etc, machines.
6. Estimated Investment:- For plant which will be produce about 30,000
Gross or 4,320,000 pencils pre year, total investment will be about Birr 1.2
million.
7. Benefits:- Self sufficiency, saving of foreign exchange, potential of export to other regions, transfer of new technology and skill to the Region plus the
other common benefits.
8. Possible Location:- Kosso Ber,Dangila, Bahir Dar.