Engineering Economy Studies on the Development and Production of Yoghurt using Indigenous Starter Culture

Abstract

In this paper, the economic viability of the production of yoghurt using indigenous starter culture is determined. Based on an output of 180 x 103 litres/year, the yield of the product, the quantities and costs of raw materials, centrifuge and incubator, were estimated at 100% capacity utilization (CU). The costs of land acquisition and factory building were obtained from contractors. The labour cost was also estimated for 60 staff members. The selling price of ₦120/litre of a similar product was adopted. Annual worth (AW), and present worth (PW) were calculated and used to establish the profitability of the products. The results showed that the proposed plant would produce 180 x 103 thousand litres of the yoghurt at full CU. The PW and AW showed that the product was economically viable with PW and AW greater than zero at 100% CU. At 100%, all the profitability indices for the product were positive. In conclusion, the production of yoghurt using indigenous starter culture is technologically and economically viable.