Business plan for a sugar factory. How to start your own granulated sugar business

The food industry is always the most resistant to competitive changes in the market, since the demand for products in this area is stable. There are several highly profitable industries. One of them is the production of granulated sugar. It can be considered a promising and profitable type of business.

About sugar production

Sugar production is a fairly large branch of the food industry. It has about 320 enterprises. They specialize in the production of products, which are divided into granulated sugar and refined sugar.

As a rule, sugar-sand factories are located near sugar beet sowing areas and operate seasonally. The production of granulated sugar at modern enterprises is quite large-scale. Thus, large and well-equipped plants can process up to 6,000 tons of beets.

Sugar-refinery production involves the production of lump refined sugar or refined granulated sugar. Such plants are located in large cities and can operate all year round.

Features of sugar

Both refined sugar and granulated sugar are high-quality food products that are characterized by a sweet taste. In addition, it is almost pure sucrose. It can be easily and completely absorbed by the body, allowing you to quickly restore lost energy.

It is a disaccharide, which, under the influence of enzymes, breaks down into glucose and fructose. In addition, sucrose is easily soluble in water and forms supersaturated solutions. As the temperature rises, its solubility increases.

Sucrose can be in a crystalline or amorphous state. If we talk about the chemical structure, then sugar is a weak polybasic acid, which, when reacted with alkali or alkaline earth metals, gives compounds called "saccharates".

It should be noted that due to fructose, invert sugar is hygroscopic, therefore it slows down the hardening of bread, prevents the process of candied jam, and also prevents marshmallows, marmalade, fudge or other confectionery from drying out.

Analysis of the sugar market

The production of granulated sugar always remains promising, since sugar has been and will remain a commodity of prime necessity. It is always in stable demand, which does not pass.

It should be noted that the sugar business is characterized by rapid growth. This is due to the reconstruction of factories and an increase in their production capabilities. In addition, one can notice a positive trend in the consumption of sugar by the population.

So, if you indicate statistical data, then a person consumes about 20 kg of this product per year, not counting the amount that is included in other delicacies. And although doctors do not recommend eating a lot of sweets, believing that this negatively affects health, the overall functioning of the body and can lead to diabetes, the demand for sugar is not reduced. That is why a high-quality business plan for a sugar factory is a good opportunity to organize a well-thought-out production and get a good profit.

Features of drawing up a business plan for a sugar factory

From a technological point of view, the production of granulated sugar is a complex and labor-intensive business that requires expensive equipment, significant financial costs, as well as a large number of professional workers. In order to competently enter the sugar industry and succeed in it, you need to clearly find out all the features of this business. For this, they draw up a business plan for a sugar factory.

This is an extremely important document that can determine the future of the enterprise. It is with the help of it that they find out the profitability of the plant, its ability to receive investments and be in demand, as well as the level to which it will be possible to increase production. Errors in the calculation are unacceptable, since the opening of such an enterprise requires significant investments.

The volume of risks depends on the cost of equipment, the lease of premises that will be used as warehouses, as well as the costs of launching the production itself. What matters is the purchase of the necessary raw materials, obtaining various permits, as well as wages.

Key Points in a Sugar Mill Business Plan

To open a new sugar production, you need to make calculations depending on the market situation and the characteristics of the workflow. It should be noted that the business plan is made up for at least 3 years and is constantly updated. It is recommended to collect the following information:

• General information about the project and the sugar market. It is necessary to determine the relevance and prospects for opening a plant. Analysis of the market, demand and competitive environment, profitability assumptions are also of great importance.
• Definition of mission and strategy. For production to be successful, it is necessary to formulate a mission, which is the social idea of ​​the future company, as well as a strategy - an action plan that will help achieve the goals.
• Clarification of the list of all necessary documents.
• Financial part. All expenses and planned profit should be determined.
• Technological line for the production of sugar.
• Sales strategy for finished products.
• Personnel policy.

Raw materials for the sugar business

The raw materials used to make sugar are:

• sugar cane, which is most actively used by enterprises in Brazil, Cuba and India;
• sugar beet - the production of beet sugar is widespread in the USA, Russia, Germany and France;
• palm sap - used in Southeast Asia;
• starched rice - malt sugar produced in Japan;
• sorghum stalks - sugar from this raw material is made in China; it should be noted that it does not have competitive advantages when compared with beetroot or cane.

If you specify the types of sugar according to the method of manufacture, then raw sugar is isolated. These are individual crystals composed of sucrose. There is also powdered sugar. These are finely ground sugar crystals. As a rule, powdered sugar is used in the confectionery industry. The main type can be called granulated sugar. It is sucrose crystals, the dimensions of which are approximately 2.5 mm. If a product is made from a very pure substance, then they talk about refined sugar.

Features of beet roots

Sugar beet is an important ingredient in sugar production. It is a biennial plant that is drought tolerant. In the first year, root crops with a powerful root system are grown. The following year, new rosettes of leaves appear, as well as stems with flowers and seeds.

It should be noted that in the production of sugar only root crops of the first year of development are used. They are fleshy and highly compacted sections of the root system, have a cylindrical shape. The mass of the root crop averages 200 grams. Its pulp consists of microscopic cells that perform various functions. The outer tissue is protective, called the periderm. The main tissue is the parenchyma, which accumulates beet juice in its cells. It is rich in sucrose and other substances in dissolved form.

It should be noted the peculiarity of the structure of beet parenchymal cells. They have a shell, which consists of fiber. Its walls have a semi-permeable protoplasm with proteins and surround the vacuole containing beet juice. They do not let dissolved substances out of it, therefore, in order to extract sugar from beet cells, it is necessary to heat the protoplasm to a temperature at which its proteins coagulate.

Features of the chemical composition of beets

The quality and quantity of products obtained by special processing of sugar beet depends on its chemical composition. The ratio of various components, in turn, depends on the seeds that are used in cultivation, as well as on climatic conditions.

Generally speaking, sugar beet contains 75% water, the rest is dry matter. If we recalculate for 75 kg of water, then 3 kg hold colloids, and 72 kg act as a solvent with 17.5 kg of sucrose and 2.5 kg of non-sugar compounds. There is an important indicator - the purity of beet juice. This is the percentage of sucrose content and the amount of dry matter.

As a rule, the first number (this indicator is sometimes also called sugar content) ranges from 15-22%. This means that the average sucrose content in beets is 17.5%.

If you specify the content of solids in the finished product, then their share in granulated sugar is 99.75%, and in refined sugar even more - 99.9%.

Production stages

The production of granulated sugar is a peculiar process, which is characterized by the following stages or steps:

• supply of sugar beet, its cleaning from various impurities;
• obtaining sugar chips and diffuse juice from it;
• purification of the resulting liquid;
• thickening juice by evaporation;
• cooking massecuite and obtaining sugar in the form of small crystals;
• drying and cooling of granulated sugar with its subsequent storage.

Thus, the process of producing sugar from beets includes washing and cleaning, weighing and cutting into chips, which are placed in a special diffuser. Here sugar is extracted from the plant mass using hot water. At the same time, diffusion juice with sucrose is obtained, as well as pulp. This is beet chips after the extraction stage, which can be used for the production of animal feed. Next, there are stages that make it possible to purify the diffusion juice and obtain sugar crystals.

How are sugar crystals obtained?

After the diffusion juice is obtained, it is mixed with lime in a saturator. Next, the resulting solution is heated and carbon dioxide is passed through it.

As a result, filtration takes place, during which a "purified" juice is obtained. Sometimes ion exchange resins are used at this stage.

Then such a “purified” juice is evaporated, obtaining a syrup containing 65% sugar, and crystallization is also carried out in special vacuum apparatus at 75 ° C. In this case, the massecuite of the first crystallization is obtained.

It is a mixture of sucrose and molasses, which enters the mixer, massecuite distributor and centrifuge. The sugar crystals that remain in the last device are bleached and acted upon with steam, resulting in the usual crystal sugar.

It should be noted that the production of sugar from cane is characterized by a similar technological process. The difference is the absence of an extraction stage (the cane is simply squeezed out), as well as the method of purification of the resulting juice (it is treated with a much smaller amount of lime).

Equipment for the production of sugar from beets

To establish the production of sugar, you need to purchase a set of specialized equipment. With it, you can prepare the beets for the further technological process.

This set of equipment includes:

• sugar lifting plant;
• hydraulic conveyor;
• sand, haulm and stone trap;
• water separator;
• beetroot washing machine.

In terms of sugar production equipment, the main machine line includes the following:

• conveyor equipped with a magnetic separator;
• beet cutter;
• scales;
• diffuse installation;
• screw press;
• drying for pulp.

In addition, in the production of sugar, filters, heating devices, saturators and sulfinators, as well as sedimentation tanks, defecation devices are used. The equipment that is considered the most energy-intensive is the vacuum apparatus, centrifuges and evaporators with concentrators. If maximum automation of production is required, then a vibrating container, a vibrating screen, as well as a cooling-drying unit should be purchased.

Features of the purchase of equipment for the sugar business

Sugar production equipment can be purchased in several ways. You can make an independent layout from different machines (including non-specialized ones), buy a line of devices or an entire plant that has already been in use, purchase a ready-made sugar production business or completely new devices. The first option is the most economical, but can only be used by people who are perfectly versed in technology.

A significant advantage of the purchase of an inactive sugar factory is the developed infrastructure and the developed network of suppliers. But one should also remember about a serious minus - it can have worn-out equipment and be simply unsuitable for profitable production.

If you buy a new ready-made sugar factory, then you should carefully weigh everything, because the costs are rather big. Attention should be paid to the quality of the equipment, since the previous owner could depreciate it heavily even after several years of operation. For an optimal assessment of the technical condition of the machines, it is better to consult with a specialist.

It is difficult to open a sugar factory on your own due to too high material costs.

Features of the organization of sugar production

The best option is to organize a business that provides for the establishment of production with a focus on a small city or even a separate urban region.

At the same time, a mini-factory for the production of sugar from beets can become an integral part of a profitable business. Subsequently, it can be expanded, reaching a higher level and increasing the volume of production and sales.

It should be noted that the production of sugar is almost all automated, if you do not take into account the harvesting and primary processing of root crops. That is why the issue of recruitment of staff is not a paramount task.

The most important thing in this business is high-quality equipment, which would be characterized by durability and reliability, as well as a high level of production capabilities.

In addition, it must be remembered that when planning a sugar factory, one should take into account not only investments and income from the sale of the main product, but also profit from the sale of waste generated during the production process.

Given all the features of the sugar business, good earnings are guaranteed.

The characteristics of a commodity are its homogeneity and the presence of many buyers and sellers. But sugar is also a raw material, which means that price fluctuations for it are as high as, for example, for oil. It is a durable product. In addition, it is a product of almost final consumption, ready for retail packaging. And this is its uniqueness, because no other exchange commodity is a finished product to such an extent.

STORAGE FEATURES
The quality of granulated sugar is determined by GOST 21-94, refined pressed sugar - GOST 22-94. The specificity of the storage of this product lies in the fact that it is not stored in heated warehouses and, relatively speaking, is not stored on the banks of the river, since sugar is groscopic. In winter, in heated warehouses, it will clump. This is due to the temperature difference: the collected moisture during cooling falls on the inner walls of the bags in the form of condensate, which leads to the pressing of sugar, especially if it lies in multi-row herds. Bags of sugar that have been lying around for many years are called "lollipops" because they can be carried, as they say, under the arm.
10-12 years ago there was a "revolution" in the field of packaging: polypropylene bags appeared. Now jute bags are practically not used, sugar is stored in a double polypropylene bag with a polyethylene (cellophane) liner.
Sugar compares favorably with other food products stored in bags in that it is not eaten by rats. Sugar is 99.9% sucrose. For these animals, this carbohydrate is of no interest as a food product.
Large wholesalers put sugar in large hangars, filling them completely and leaving no room even for aisles. Up to 25 bags can be stacked in height. Another method of storage is used in grocery stores, where there are several items in the assortment. The car is unloaded on pallets, forming a cube no more than 12 rows high. This is done for ease of storage and compliance with ventilation standards so that sugar is not stored on the floor. Manufacturing plants do not ship sugar on pallets in order to save space in wagons or cars.
Sugar keeps for a very long time. In certificates, the period of its storage is limited to one year. But in fact, it can lie completely without problems for three years, especially if it meets all the requirements of GOST (primarily in terms of humidity). And even if it crumples, it will not bring big trouble to the product. In extreme cases, sugar can be dissolved in food production, as it is often in demand in the form of syrup.
As a rule, sugar is not weighed during loading and unloading, because wholesalers work with regular suppliers and know what to expect from them. Quality analysis can only be done if the sugar comes, for example, frankly yellow. The quality and weight of this product are primarily of concern to food and confectionery manufacturers. Having weighed the loaded and empty car, they can calculate the intra-package shortage.

STORAGE COST
Compared to many other goods in bags, sugar is a rather capital-intensive commodity, for which the cost of paying interest on a loan is quite significant (trade operations are usually financed with borrowed money).
Transportation and storage costs for sugar are quite significant. It is several times more expensive to store than, say, chocolate. Transport and storage costs in operations with the latter product are fractions of a percent of its value, and for sugar - more than 2%. Moreover, these are expenses only for transshipment of goods from the wagon to the warehouse and then to the buyer's transport. Naturally, if sugar is stored for six months, then the costs will increase. Other finished products, as a rule, are more expensive, and therefore the share of transportation costs in the structure of its cost is not so significant.

BEET AND CANE
The Russian market sells sugar produced from sugar beet grown in our and neighboring countries, and sugar cane, the semi-finished product from which (raw sugar) is imported from Brazil, Cuba and Thailand. In chemical composition, they differ from each other by hundredths of a percent, this difference is not significant. However, it is widely believed that beet sugar is sweeter. This is most likely a delusion. In a closed test, most people can't tell one sugar from another.
Sugar beet, unfortunately, is not grown enough in Russia. It is enough to cover only a little more than a third of consumption. Of the 6 million tons of sugar needed by Russia annually, until recently only 1.6 million tons were obtained from beets. In recent years, there has been an increase in production, and in 2004 a record was set for the last 10 years - 2.26 million tons were received.
Processing of sugar beet begins in September and lasts 2-3 months. The best plants are finished until February, the rest are left without beets already in November-December. In addition to the insufficient volume of sugar beet, there is a problem of its storage. Frosts and thaws turn beets into almost porridge, the yield of sugar from which is zero. In the northern United States, where the climate is no warmer than in Russia, there is a well-functioning and simple storage technology that allows plants to process beets until May. It is stacked in large hangars with thermostatic inserts such as foam. Then they wait for frosts down to -10 ? C and close the room, it turns out a natural refrigerator.

MARKET DYNAMICS
The management of sugar stocks is completely determined by the “earnings” of companies: if there is no “earnings”, no one holds stocks. And they are not managed by logistics specialists, but primarily by commercial directors.
Price dynamics are very difficult to predict, and state regulation is a key factor in this matter. There is no other market in Russia that would be so dependent on government decisions (on whether quotas will be introduced, at what level duties will be established and from what date, etc.). In 2001-2003, raw material imports were subject to quotas, within which the duties were lower than outside the quotas. The companies bought quotas at auction and were engaged in importation. Since 2004, the quota regime has been abolished and the mechanism of floating duties has been in operation. They change every month in inverse proportion to the New York Stock Exchange quotes: the higher the exchange prices, the lower the duty.
In addition to price fluctuations, the situation on the sugar market depends on the total reserves in the country, and their volume also changes quite significantly - from 0.3 to 1.8 million tons. The price minimum was recorded in the spring of 2000 - about $220 per ton, and in June 2004 prices exceeded $580.

STRATEGY OF THE PRICE GAME
Sugar inventory management is a strategic price task associated with constant monitoring of the market situation. There are no universal recipes here. Someone thinks that raw sugar will be more expensive in spring and summer, so in the fall they buy sugar from beets and build up stocks at the factory or ship them to the regions. From September to January, ready-made sugar is shipped, and sales continue until June. Someone expects an increase in import duties and, accordingly, an increase in prices, so they stock up. Someone seeks to get a profitable contract for the purchase of Belarusian or Kazakh sugar, acquires significant volumes during a period when sales activity is low, and then sells them for several months. The pricing strategy of all companies is different, and everyone is trying to guess what will happen to prices.
If we talk about a small regional wholesaler, a dealer of several companies, whose turnover is one thousand tons per month, then, as a rule, he works with 2-3 permanent suppliers. He may also have irregular suppliers who manage to profitably purchase goods. What is the market strategy of such companies? They can manage the timing of the purchase and sale of sugar. Can sell / buy a few days or weeks earlier or later. It depends on the price situation in the market. If prices have been declining for too long, companies may decide that they should go up now and therefore immediately buy sugar in the amount of their two-month requirement. Or they can be made a very interesting offer at factory prices, and they decide that there simply will not be lower prices.
However, if the market is clearly in a downtrend (the price has been declining for several weeks or even months) and demand is sluggish, then such a regional trader minimizes his purchases to the limit. If he bought 10 wagons a week, now he takes a wagon only to "maintain his pants." He knows that tomorrow the price will be even lower, but at least a minimum stock is required for turnover.
Large companies that import raw material themselves usually have their own analytical departments that track prices, production and imports. Based on the results of the analysis, a decision is made: to take or not to take a batch from the next vessel as a whole (25-40 thousand tons) or in parts (5-15 thousand tons).
For three consecutive years (2001-2003) the quota regime was in effect. Many companies simply had to buy sugar abroad, because the quota had to be redeemed, even if the market situation was unfavorable. Naturally, after that they “sat” on stocks for a long time and traded a little bit. Quotas have now been abolished, but another situation is possible, similar to the one that developed in December 2004. At that time there was a very interesting conjuncture for raw materials: world prices were low, the duty was reduced, and other costs were low. As a result, in December there was a surge in imports. The companies brought in raw material, processed it, distributed it to their dealers, and as a result sold off stocks for several months. When the next successful period comes, companies will again try to purchase large quantities.
The industry has been living in this rhythm for many years. The market is very dynamic, and not everyone survives on it.

Sugar stocks in the Russian Federation at the end of the month, thousand tons

PRICING
In Russia, pricing on the sugar market is largely “set” by factories in the Krasnodar Territory. Although there are only large producing regions, at least eight, Kuban is a kind of market thermometer. The price in all regions is equal to the price of Krasnodar plus the railway tariff plus the costs of transshipment at the warehouse, which amount to 300-350 rubles. from a ton. However, the market situation in recent years is such that the real, existing price is much less than a simple calculation shows, so it does not cover the costs of storage and transshipment.
This is due, firstly, to the fact that in many regions prices are reduced by the supply of imported sugar from the CIS. For example, having bought sugar in Krasnodar and brought it to Smolensk, the company will not only not cover the costs of transportation and storage, but will also incur significant losses, because there is a lot of relatively cheap Belarusian sugar there.
Secondly, large-scale wholesale firms can buy a significant consignment of goods and deliver all of it to one or two cities, thereby collapsing prices. Either they found an extremely favorable price, or they bought two months ago at prices that no longer exist, and shipped the goods to them late, or they “sat on it” and did not sell for some reason of their own. One way or another, they put the price below everyone else, and the rest of the firms are forced to leave this region.
You also need to take into account the volume of imported raw sugar. Now there is a floating duty regime, and there are months when everyone or no one is carrying it. Naturally, when imports increase, the price tends to decrease.
The price of a possible purchase on railcars and the price of sales in the region never differ by a constant value, there is no stable margin. Factory prices may go up while retail prices stay the same, and vice versa. The work of companies in such conditions is determined by the qualifications of the team. Only professionals who feel how the price will change in the region and at the factories survive. The peculiarity of the sugar market is that this product is absolutely the same, not branded. If a neighbor has one penny cheaper, all buyers will go to him.

SUGAR LOGISTICS
The share of costs for transport and storage is quite large in the price of the goods, so allowing yourself to transship sugar twice is an expensive pleasure. Most companies try to do it once. Sugar from manufacturing plants is delivered by wagons directly to the region of final consumption. For example, sugar arrives at a Moscow warehouse, is unloaded from wagons, and is bought up from the warehouse by small regional traders, packers and industrial consumers. Very often, sugar does not even enter the warehouse, it is taken directly from the wagons to reduce storage costs.
In past years, companies could afford triple and even quadruple transshipments, transported from one region to another and stored for a very long time, waiting for a rise in prices for six months. These times are over, prices may never return to the expected level. Now the machines come to the warehouse every day, and he usually keeps a one-two-day supply in case of force majeure, so as not to stop production. At the same time, if players are confident that the uptrend will be prolonged, or expect a disruption in supplies, then the volume of stocks may increase.

SEASONALITY
As statistics show, the demand for sugar among the population increases in May-September with a peak in July, which is associated with home-made preparations. At the end of the year (since September), the demand from confectionery and food industries increases on the eve of the New Year holidays (the production of gifts increases, etc.).
The only stably fixed is only the July seasonal surge. But this growth does not happen every year. For seven years of observations (1999-2005), it occurred twice explicitly and once implicitly. Judging by the fact that last year there was a surge, this year it is unlikely.
It can also be noted that prices always fell in August. But the decline occurred from different levels: the price was both 250 and 600 dollars per ton.

IMPORT MODE
It should be borne in mind that the existing import regime does not limit the volume of sugar imports. If a favorable situation develops within 1-2 months, “extra” hundreds of thousands of tons may be brought to Russia, which can affect prices within six months.
Until 2004, a sugar import regime was adopted for each year. In the best years, in July-August, a government decree was issued, in which all duties and quotas were scheduled. In 2004, the sugar import regime was adopted only in mid-December and factory prices fell from August to mid-December. All market players did not know what to expect. What if the government lowers duties a little? Reducing import duties will immediately lead to lower domestic prices. This delay in making a decision was strongly reflected in prices: factory prices clearly played down until mid-December.

ELASTICITY OF DEMAND
Unlike other commodities, sugar sales are driven solely by price. Moreover, this dependence is very rigid. Let's say the wholesale price per kilogram is 15 rubles, if the price is 15.10 rubles. - two bags are sold, if 14.90 rubles. - 300 tons are on sale.
To make sugar “not exactly the same”, traders pack not only 50 kg bags, but also 25 kg and 10 kg bags with a handle, provide delivery services, and provide payment deferrals. Some offer a wide range of groceries along with sugar. If a wholesaler buys several items at once, for convenience and savings in transportation costs, he can buy sugar, cereals and flour from the same company, even if the price is slightly higher than that of a neighbor.

PACKAGING
Some companies hope that the organization of their own packaging shop will increase sales. However, it is worth remembering that packaging is a completely separate, very specific business. And those who work in it almost never enter the wholesale market. Packing cannot be done optionally. In extreme cases, it (and only it) can be handled by a separate manager. If there is no such person, then packaging will not save the situation.
In the Moscow region, packaging capacities have been redundant for many years. As a result, simply dumping tariffs were formed. The price of sugar does not cover the cost of its packaging.
In order for a packer to survive, he needs an assortment and significant sales volumes, which are provided by large retail chains. And reaching out to such customers is not always easy, and their purchase prices are lower than in a separate store or a small chain that can buy sugar at any price.
The essence of packaging is an attempt to brand the product. And it is extremely difficult to create a legend on sugar. This is a simple exchange commodity that everyone is used to buying in bags.

CIVILIZED MARKET
So, the price of sugar is influenced by the expectations of market players, changes in final demand, the dynamics of sugar beet and raw production, the dynamics of duties, imports, world prices, and a number of logistical factors.
It is worth noting that every year the bag trade is dying: the Russian consumer is becoming European, and the sale of packaged products is growing every year.

Sugar is a unique product. With his participation, not only confectionery and alcoholic products are made, but also pharmaceuticals, plastics and much more. Not to mention the fact that a significant share of it is bought at retail. Therefore, the production of sugar is a necessary and demanded business.

Market analysis

The main advantage of the sugar business is that the sale of the product does not have seasonal fluctuations. The production itself is increasing every year. But the market is still far from saturation, because the level of consumption of the product is also growing. On average, one person eats about 20 kg of it per year. The United States is the world leader in sugar production, while Russia is in second place. This fact suggests that the country has excellent conditions for the implementation of such a business.

Business pros and cons

As with any other production, the sugar business has its advantages and disadvantages. The main disadvantage of this type of business is a strong dependence on raw materials, more precisely, on places where it can be obtained. In the Russian Federation, sugar is most often made from sugar beets. And it grows mainly in the Southern, Volga and Central districts. If there is a desire to open a plant in other regions, raw materials must be imported, which increases production costs.

More than 90% of the product in Russia is made from imported raw materials. Product prices are relatively high. Therefore, if you organize production on local raw materials, you can significantly benefit from the difference in selling prices.

Another advantage of the product is that it is one-component. That is, only one type of raw material is needed for its manufacture. The consumption of the product is high and the cost of setting up a plant is relatively low.

Organization of business from the formal side

First of all, the business plan of the sugar factory should provide for the registration of a legal entity. The organizational form of an LLC is much more preferable than an individual entrepreneur, since it will allow you to work on a large scale, cooperating with large organizations.

The following necessary formalities are to bring the production facility in line with the requirements of the fire inspectorate, SES and other authorities. As a rule, this takes a lot of time, effort and money. Specific norms and requirements are best checked locally, as they may vary slightly from region to region.

The next important point that the business plan of a sugar factory should take into account is that the final product must comply with special state standards. Therefore, before starting production, it is necessary to study the requirements of GOSTs:

• Sugar beet. Specifications (R 52647-2006);
• Sugar beet. Test methods (R 53036-2008);
• Method for determination of sucrose (12571-86);
• Sugar production (R 52678-2006).

Types of products

Sugar can be prepared in a variety of ways and produce a variety of products. There are such types of it:

• Refined is highly refined sucrose, which is divided into pieces, usually cubes.
• Sand - sucrose, which has the form of crystals 0.5-2.5 mm in size.
• Powder - crushed crystals of sucrose.
• Raw - individual unground crystals of sucrose.

Raw materials for the manufacture of the product

Traditionally, in the CIS, sugar was produced from sugar beets. However, today these raw materials have been supplanted by import offers. Therefore, in addition to beets, which are grown in Germany, France and the USA, the following raw materials are used:

• Bread sorghum (stalks). Its main producing country is China. But the product made from it is not much different in its characteristics from sugar from beets or cane.
• Millet or starchy rice. It is made from malt sugar. The main producer of such raw materials is Japan.
• Palm juice. It is mined in the countries of Southeast Asia.
• Cane sugar. Cultivated mainly by enterprises of Cuba, India, Brazil.

Sugar production technology

Before you open a mini-factory for the production of sugar, you need to study the technology of its manufacture. This will give an understanding of what equipment for sugar production should be purchased. As an example, let's take beetroot production, which goes through the following main stages:

1. Extraction. To do this, the raw materials are washed well, then cleaned, the required amount is measured and put on chips. After grinding the beets, the chips are loaded into the diffuser. There, sugar is extracted from this mass with the help of hot water and diffuse juice is obtained. This is not the final product yet, but it contains 15% sucrose. In addition to it, there are also beet chips and pulp.
2. Purification of diffuse juice. To do this, it is mixed with milk of lime and carried through special purification steps.
3. Removal of excess water through its evaporation. At the end of this stage, a syrup remains, a little more than half of the volume of which is sugar.
4. Crystallization. The technology of sugar production is completed by passing the syrup through centrifuges, massecuite distributors, vacuum apparatuses. Only after that, crystallized sugar remains at the exit.

Production equipment

Each stage of production requires its own set of equipment. So, to prepare beets for processing, you need the following set of installations:

• beet washing machines;
• stone traps;
• water separator;
• top traps;
• sand traps;
• hydraulic conveyor;
• beet lifter.

The main production line consists of:

• dryer for pulp;
• screw press;
• diffusion installations;
• scales;
• beet cutters;
• conveyor with magnetic separator.

To purify the juice you need to purchase:

• settling tanks;
• sulfitators,
• saturators,
• heating filters,
• defecation devices.

The last stage of production goes through the following installations:

• evaporator plant with a concentrator;
• centrifuges;
• vacuum devices;
• drying and cooling plant;
• vibrating sieve;
• vibroconveyor.

room

The premises for small production must meet all the requirements of the premises of the food industry. The area is selected based on the dimensions of the installations. In addition to the production workshop, a dry and well-ventilated warehouse for storing products should be provided in the production, because sugar absorbs any flavors well.

Putting production into action

There are several ways to organize and run a plant.

1. Buy a ready-made mini-factory. However, then it is very important to know the date of opening and commissioning of the plant. In the event that this happened a long time ago, the equipment will be unusable, even if it is in working order. It is best to invite a specialist to assess it. Such an enterprise can cost up to two million dollars. If the enterprise opened after 2000, its price will increase to five million and more.
2. Organization of the plant from scratch. In such scenarios, the production line must be purchased new. The price of such equipment depends on its production capacity:

• equipment for 10 tons per day - 10-20 thousand dollars;
• equipment for 15 tons every day - 100 thousand dollars;
• equipment for 50 tons per day - 200 thousand dollars.

Special production conditions

The processing of beets into sugar takes place during the so-called campaign, which lasts 3-4 months per year - when the raw material is ripe. All this time, the equipment works constantly, without interruptions, and the staff works in shifts. When the beet processing campaign ends, the equipment should be checked and repaired if necessary.

But the production itself is considered safe, since dust, toxic gases and so on are not emitted during the work. The only problem may be high noise during the operation of the units.

Production expansion

Most often, young production is focused on the production of granulated sugar, since this is the most popular type of product. As soon as production is established, you can expand the range.

Rafinated sugar

First of all, the production of refined sugar is added to the main line. A Chinese installation with a capacity of 150-200 kg per shift costs about 2 million rubles, a Turkish one - up to 7 million rubles. It is also necessary to purchase automatic packaging equipment, which is at least another 600 thousand rubles.

This sugar can be made in two types:

• pressed: granulated sugar is processed in a centrifuge, pressed, dried and then pricked into cubes of a given size;
• cast: a mass of sugar is loaded into special molds and left until it hardens, after which it is poured several times with pure sugar, washed. This removes the molasses. After that, the pieces are taken out of the molds, dried and split into cubes of the required parameters.

Cane sugar

Its production is similar to the production of a beet product with some differences:

• The extraction stage is replaced by squeezing the soaked stems on special rollers. This makes it possible to extract 90% of the sucrose contained in the cane. The juice goes into a pulp trap, then it is processed on juice meters.
• Juice purification stage. It is immediately processed with lime without preliminary processing steps, as is the case with sugar beet production.

Molasses and pulp

After cleaning the diffuse juice, molasses and pulp remain. The first is excellent fodder silage and the second is fodder molasses. They are usually bartered for raw materials from the agricultural producer. But the molasses itself is in demand by a certain category of buyers.

In addition, you can earn extra money on the production of candy sugar - very large transparent crystals that are made on special equipment. There are other areas of production that can be established in addition to the manufacture of granulated sugar.

Payback calculation

As practice shows, if initially competently organize the supply of raw materials and the sale of finished products, the plant can pay off in six months, that is, in one season. But the cost of equipment greatly affects the timing. The equipment of a European manufacturer with a capacity of 20 tons per day will cost at least 90 thousand euros. If you buy equipment with a capacity of 100 tons per day, you need to allocate about 270 thousand euros for it. If you decide to purchase a mini-plant with a capacity of 12 tons per day, then the basic equipment will cost you 18-20 thousand dollars.

Do not forget that in order to conquer the market, you must be able to beautifully present the product. It is necessary not only to develop your own brand, but also to organize the production of understandable and beautiful packaging for the product.

Summary

The business plan of a sugar refinery describes the procedure for opening a business, taking into account the market situation and calculations of financial and investment performance indicators.

The main prerequisites for calculations: the plant will be built from scratch, its production capacity will be about 1.5 thousand tons of sold products per year. The goods will be supplied both for enterprises using granulated sugar as a raw material, and for retail resale. The enterprise will be equipped with modern technological production lines.

Payback - about 2.5 - 3 years.

Contents of a sugar mill business plan:

1. Summary.
2. Marketing research of the market.
3. Investment plan.
4. Plant building issues.
5. Features of work with suppliers of raw materials.
6. Sales of finished products.
7. Organizational aspects.
8. Manufacturing technology.
9. Manufacturing aspects.
10. Income and current expenses.
11. SWOT-analysis of activity.
12. Description of risks.
13. Final performance indicators, their characteristics.
14. Conclusion.

What is the purpose of a business plan?

1. It will help with the launch of the sugar plant, allow you to take into account all the nuances of the process and will not let you go astray from the intended course.
2. As a tool for interaction with suppliers, contractors and buyers of finished products.
3. To create an opportunity to receive a loan from a bank or a contribution from investors.
4. As a benchmark to monitor plant performance over time.

An example of a business plan for a sugar factory

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Standard	extended with financial calculations with Excel financial model	extended with adjustments
Standard business plan		Extended sugar refinery business plan with full business analysis and financial plan for 5 years
		Detailed financial model of a sugar refinery
	Break even point calculation	Analysis of profit and profitability in the context of individual business areas and products Analysis of business risks and margin of safety in terms of sales volume, cost and credit load Sales forecast quarterly for 5 years Cost forecast quarterly for 5 years Calculation of conditions for obtaining and repaying a loan Break even point calculation Statement of Cash Flow quarterly for 5 years Analysis of financial and investment indicators
		Adjustment of the business plan to your figures by our analysts within 5 working days
Business plan volume: 30 pages.	Business plan volume: 80 pages.	Business plan volume: 80 pages.
10 000 rub.	20 000 rub.	39 000 rub.

This kit is ideal for those who need a business plan to get a loan or attract investments.

Description

The extended business plan includes a financial model of the sugar refinery in Excel format.

The business plan was developed taking into account the practice of evaluating projects in Russian banks, as well as taking into account the requirements of investors and entrepreneurship support funds in the Russian Federation. It will make it possible to justify management decisions on investing in the creation and development of a sugar factory, predict its financial results and assess risks.

A full description of the business plan can be downloaded from the link:

Content

To view the content, download the file:

Tables and graphs

To get acquainted with the list of tables, graphs and diagrams, see the file:

Payment and delivery

You can pay in the following ways:

• Bank cards (Russia)
• Electronic money
• Terminals and communication salons
• Money transfers
• Bank cards (International)

Sending a business plan and financial model:

Sending is carried out within 24 hours after payment to your email address.

Business organization

Sugar is a product of wide application. It is used to prepare various dishes and products, alcoholic beverages, as well as in pharmaceuticals, agriculture, plastics, etc. The production of this product cannot be called too complicated, since sugar is a mono-product. However, in order to launch the project quickly and successfully, you will need a good sugar mill business plan.

What to do to start the project?

1. Conduct an analysis of the market environment, including the main suppliers of raw materials and market players.
2. Pick a place.
3. Organize plant construction activities.
4. Purchase and install production facilities at the facility.
5. Recruit staff.
6. To train.
7. Negotiate cooperation with suppliers of raw materials and wholesale buyers.
8. Start process.

As a rule, granulated sugar is made from sugar beet, which is also grown in Russia, while a large amount of raw materials comes from foreign countries. To reduce the cost of production, it makes sense to find reliable suppliers of raw materials in our country. Most of the sugar beet in Russia is grown in the Central, Volga and Southern federal districts.

Market analysis and description of the sugar factory project

More than 70 sugar factories operate on the territory of the Russian Federation. The total volume of sugar production per day is more than 300 thousand tons. At the same time, the market continues to grow. The demand for the product is very high, which is explained by the wide scope of the product. To take its rightful place in the segment is a very real and promising task for an entrepreneur.

Produced goods/services

Granulated sugar, refined sugar, powdered sugar, raw sugar, molasses, fodder silage (for agriculture), etc.

Potential clients

Enterprises using sugar products in their own production processes, retail chains, shops, agricultural producers, etc.

Calculations for opening a sugar factory are presented below in a sample business plan.

Financial part of the sugar factory business plan

Investments:

Attachments	Terms, in months	Amount, thousand rubles
Organization registration, paperwork
Design work
Construction of a sugar factory
Conducting communications (electricity, water supply, etc.)
Carrying out finishing work
Procurement of equipment and other items of equipment
Obtaining the necessary permits
Acquisition of raw materials for the first time
Other costs

An example of a business plan for a sugar factory suggests that investments in the business will amount to about 40 million rubles.

Income:

Source of income	Approximate price, rub. per 1 kg	Sales volume, per year (averaged), tons	Amount of proceeds, thousand rubles in year
Granulated sugar in bulk (for production)
Granulated sugar for retail
Other types of sugar products
Other income

The annual revenue will be about 45 - 55 million rubles.

Expenses:

Annual expenses - an average of 30 - 35 million rubles.

Profit, payback and profitability of the business:

The payback period of the project is about 2.5 - 3 years, the profit is an average of 12 - 20 million rubles annually, and the profitability is 33%.

Conclusions:

A sugar factory is a great idea for investing capital and a promising and profitable activity. This business has its own specific features that you need to understand before launching a startup. A professional sugar production business plan will help you understand all the intricacies of the technological process and business organization.

Download the business plan template and financial model template and you will be able to:

• Launch the project based on the calculations made according to the proposed financial model template, taking into account individual business development factors. You can save up to 150 thousand rubles by doing all the calculations on your own.
• Always have before your eyes a complete picture of the plan and act in accordance with the plan, in a timely and high-quality manner, putting each stage of work into practice.
• Provide funding in the required amount by submitting a document for study and analysis to banks, investment companies or other financial institutions.
• Conclude profitable contracts for the supply of raw materials and the sale of finished products to wholesale buyers, conduct effective current work with counterparties and systematically increase production volumes.

Starting your own business is the dream of many, many people, but only a few dare to take this serious, difficult, but at the same time such a tempting step. We are confident that you will be able to overcome all inner fears and start your effective business.

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