MODULE 3

TECHNICAL ASPECT

Engage: Manufacturing Process

Explore: Process equipment and plant design
Explain: Material and Energy Balances
Elaborate: Process operating conditions
Evaluate: Evaluative assessment

Introduction

The technical aspect is one of the essentials of this study because this factor responds to the
technicalities and basic structure of the proposed study. This includes the equipment,
materials, structure plan and also the source of supplies use in the proposed project

Product

This portion describes the product(s) to be manufactured and sold. The description specifies
the products’ physical and chemical properties and identifies the various uses, both as
finished goods and industrial inputs.

Manufacturing Process

The selected manufacturing process must be described simply and clearly, preferably with
the aid of flow charts and diagrams. The alternative processes and the way they compare
with the chosen process must be mentioned. The analysis should further touch on the
manufacturing processes used in existing plants with the same or similar activity, both
domestic and foreign. A material and energy balance must accompany the flowchart
presented for a better overview of the project.

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 Plant size and Production Schedule

State the minimum and maximum rated capacity of the plant. The minimum capacity is that
level of production where the resources are not fully used, but are employed at a minimum
economical level. In general, the minimum economical level is that level of production
where the firm’s fixed costs are at least covered by the resulting revenue. The firm’s fixed
costs are determined in the financial study. The maximum capacity is that level of
production where all resources are fully used.

From there, the actual capacity utilization, the number of shifts per day, and the number of
operating days per year may be defined.

Finally, the factors taken into consideration in determining the plant size must be identified
and described. Here, the findings in the market study are of major importance.

Then production schedule describes the projected scale of operation for the next several
years. Will production increase in time? By how much? The factors which will provide the
answers are expected growth in market share, availability of financing for possible
expansion, the availability of more raw materials and the level of utilization of plant capacity.

Machinery and Equipment

Machinery and equipment required must be identified and individually listed according to
type and use. Specifications, capacities and costs must be described in detail. Likewise, the
origin of the machinery, whether local or imported, as well as the manner of and cost of
transporting them must be indicated.

A balancing of capacities must be presented (material balance) to show that the

machinery and equipment are capable of producing the desired maximum output.
Detained computation must be presented in the appendix.

Plant Location

A thorough and comparative analysis for each potential location should be made to
determine the most ideal plant site.

It has to consider the following factors:

a) The accessibility to and availability of raw material sources.
b) The availability of cheap or moderately-priced utilities such as power, water or fuel.
c) The combined cost of transporting raw materials and fuel to the plant site.
d) The proximity to distributing outlets.
e) The availability of skilled and unskilled labor.

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 Plant Layout

The plant layout should be clearly depicted through diagrams and descriptions. A good
plant layout is characterized by minimum material handling, effective space utilization,
smooth work flow through the plant, safe and conducive working area for the workers, safety
and sanitation facilities of arrangements.

Building and Facilities

The site, type and cost of the building and land as envisioned in the project should
accurately presented. The construction cost of the building and facilities should be
presented as adapted to the machinery and equipment that will be used in the project.
Land improvements such as roads, drainage facilities, etc. and their respective costs should
be computed and included.

Raw materials and Supplies

The required raw materials and supplies should be listed down and the basis for their
selection must be presented. Descriptions and specifications on their physical and chemical
properties must also be given. Current and prospective costs of raw materials, the availability
and continuity of supply and the current prospective sources should also be included. The
volume required at various phases of operation must be clearly presented.

Utilities

This portion describes the amount, cost and sources of electricity, fuel and/or steam required.
This must be determined in relation to the production schedule and capacity utilization
defined. Alternative sources of these utilities and the feasibility of their use must also be
described.

Waste Disposal

A description of the quantity, manner of disposal and the cost involved in doing away with
expected waste from production is necessary. The analysis must be expanded to consider
the possibilities of further using these wastes.

A waste water treatment facility may be included and the specifications and capacities
are included. Cost of such should be accounted for.

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means, electronic, mechanical, photocopying, recording, or otherwise of any part of this document, without the prior written permission of SLU, is strictly prohibited. 3