Running Head: Feasibility Report 1

Ballpoint Pen Recycling Feasibility Report

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Ballpoint Pen Recycling

Introduction

This feasibility report is on a proposed business that makes ballpoint pens by recycling

plastic bottle disposals in the United Kingdom. Demand for ballpoint pens in the UK is likely to

grow due to the increasing numbers of student and office workers that need ballpoint to make

their work easier. The proposed business is working towards environmental safety. The report

presents details of the proposed business such as: 

1. Description of the business proposal and the product

2. Industry and competition analysis 

3. Market and operational feasibility

4. Financial forecasting

5. Future strategy for growth

Description of the Business and the product

Writing is an activity that is applicable in most occupations worldwide. With the

increasing numbers of the modern system of education both in the government sector and private

sector as well as offices even drawing artists, demand for pens is on the rise. The Ballpoint pen

Recycling Company aims to meet this demand by producing ballpoint pens from bottle disposals.

The proposed business will not only meet the demand for ballpoint pens but also minimize

environmental pollution caused by plastic bottle improper disposal.

 Ballpoint pens use the writing ball as a pen tip hence results in handwriting stability

since the ball is less likely to decrease, thus handwriting is hard to change (Yamaoka & Kakehi

2013). Ballpoint enables the user to enjoy diversity by offering different types of ballpoint pens.
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While using ballpoint pens, different characters can be attained by changing the ink. The

proposed Ballpoint pens use viscous oil-based ink which dries up almost immediately after

writing (Kher et al, 2006), thus maintaining a clean working sheet. In short, the proposed

ballpoint pen has convenience in writing over the other pen types since it can be used on both

paper and fabric without resulting in unwanted bleed-through of ink.

Industry Overview

In the UK the demand for ballpoint pens is met by production units that exist in the

nation and through importing from China. The structure of the industry is in the levels of

manufacturers/importers to wholesalers to retailers to ultimate users. There is sufficient demand,

both in the school supplies sector as well as in the open market and the proposed unit is expected

to have bright prospects for capturing a substantial share of the domestic market. The maximum

life span of a ballpoint pen is fourteen days for consistent users (Yadav, J., & Yadav, L. 2018),

meaning that after every two weeks our customer will require a new ballpoint pen thus the

demand for the pens is ever-growing and the unit is assured of a present market in the UK. The

Ballpoint pen Recycling Company aspires to work using the existing structure of the industry

which is in the levels of manufacturers to wholesalers to retailers to ultimate users.

Competition Analysis

Competition for the proposed business exists due to companies like Pen Sense Limited,

Tombow, Sheaffer pen Limited, and Pilot pen in the UK market. Hence, the existing competitors

have been in business for a while hence have advanced their distribution channels, improved

their financial position, and held a good reputation. The existing competition has not diversified

their production and has their products priced slightly, making them expensive for the local

students. The Ballpoint Pen Recycling Company idea projects high sales and competitive
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advantage due to its environmental conservation objective. Most of the existing businesses in the

UK that is in the industry of pen production offer one type of pen, thus not considering

diversification. The business aims to produce different ballpoint pens to meet different market

needs, thus drawing many customers (Yamaoka & Kakehi 2013). Our products will range from

refillable ballpoint pens to ones that can be used comfortably by left-handed persons. The unit

will apply innovative promotional strategies to strengthen demand-pull at the buyer’s end. The

Ballpoint Pen Recycling business will set the product prices fairly to gain a competitive

advantage.

Corporate social responsibility is one of the environmental factors that businesses should

meet. Ballpoint pen Recycling will be socially responsible to the neighboring society by ensuring

a clean environment since the business will recycle waste plastic bottles that pollute the

environment.

Market and Operational Feasibility

Resources

Utilities needed for this project are electricity and water. Electricity helps to run the

machinery that is used in production and also lighting for the plant (Krishnakumari, C. 2019).

The UK being developed has a well-set water supply system and electricity supply that the

Ballpoint Pen Recycling Company can use to run its activities.

Raw materials for the ballpoint pen project are:

1. The ink is the liquid that contains pigment used to produce images or text. For the

ballpoint pens, the ink will be viscous oil-based.

2. A nozzle is a tube that is filled with ink. The unit will use a plastic nozzle which will be

made from plastic bottle disposals.

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3. The casing is the outermost cover of the pen. The unit aims at producing the casing using

plastic materials from the bottle disposals.

4. Lacquer enamel is used for the shiny finish applied to the material.

5. The glue is used when putting together the materials.

6. Plastic bottles- the proposed business acquire them from the city garbage collectors with

a permit.

Target Market

Ballpoint pen Recycling aims at attracting consistent pen users like offices and students

from different learning institutions. Students' occupation demands a lot of writing since they

have to take notes, do assignments, and even draw, which can be achieved using the proposed

business product. Most people who work in offices require Ballpoint pens to make notes,

especially during a meeting. Our business has segmented the market based on occupation.

Plant and Technology

The Ballpoint Pen Recycling business will operate in the UK in Birmingham city. The

proposed business has an automatic mechanized plant plan that has a production capacity of one

hundred pens per month (Krishnakumari, C. 2019). The automatic pen-producing machinery will

be purchased from China Haijiang.com limited (Krishnakumari, C. 2019). Pipes and ink will be

acquired from India through importing. The ballpoint pen manufacturing process will be as

follows: making the ink, molding both nozzle and casing, ink filling and assembly, and then final

assembling, packing, and shipping.

Packaging and Transportation

The ballpoint pens will be packed into ‘8 by 12’ paper and cardstock where each pack

will have eight cards, eight envelopes, and eight sentiments to ensure the quality of the pens is
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protected. The packages will be well-labeled to ensure that the buyer can access the necessary

information such as the name of the company, area of operation, and quality of the ballpoint pen.

The proposed business will use private cars to transport the packages to retail and wholesale

destinations. The mailing system will also be used when ultimate users place their orders with

the company.

Organization Chart

Since the proposed business is at its initial growth stage the organization chart is narrow

with one manager, an accountant and one technical personnel, two salesperson and four wage

workers.

Marketing Strategies

The Ballpoint Pen Recycling business will utilize media such as broadcast, newspapers,

Instagram, and also Facebook at certain intervals of time to introduce the products in the market

and also attract more buyers by informing them about the product. The company aims at

marketing their products to the school students who will, in turn, spread the information about

our products to their families as well as fellow students. The unit will identify shops that can

function as the retail outlets for selling its product. Also, the Ballpoint Pen Recycling Company

will take the initiative of physically distributing pens around institutions and schools. The unit is

considering Marketing through trade channels by whole- sellers in cities or direct sales to

stationery shops.

Financial Forecasting

Total project set-up cost 2,500

Total investment 5,000
Working Capital 2,500
Total projected capital cost 10,000 pounds sterling
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Working Capital Cost

Item Cost in Pound Sterling

Marketing 400
Inventory Purchase 800
Miscellaneous 250
Payroll 300
Rent or lease 500
Other costs 250
Total 2,500

Cost of Production per unit

Pound sterling
Total unit 1,000
Cost of production 7,500
Unit cost of production 7.50

Projected Profit and Loss Statement

INCOME STATEMENT PROJECTION FOR THE YEAR 1

Revenue 10,000
Cost of goods sold 2,500
Start-up Cost 500
Investment cost 1,000
Gross profit 6,000
Expenses 1,200
Net Operating Income 4,800
Less tax (30%) 1,440
Net income 3,360

Notes for the Projected Income Statement

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 The set-up cost consists of the legal fee and registration fee (Gupta, A 2017). This cost

will be spread over the first five years of operation hence 500 is indicated in the first year.

 Investment cost consists of the machinery purchase cost. This cost will be spread over the

first five years hence 1,000is indicated in the first year.

 Total units arise from the number of units produced by the machine in one month

multiplied by twelve months to get the units produced in one year.

 The total units produced are 1,000 instead of 1,200. The 200 units are ignored to cater for

maintenance and repair time of the machines and the public holidays when the unit is not

operating.

 Revenues arise from units produced then multiplied by 10 pounds which is the selling

price per unit.

 For expenses, the Ballpoint Pen Recycling used a 12% interest rate whereas the tax rate

used is 30%.

Future Strategy for Growth

The Ballpoint Pen Recycling Company works towards achieving product diversification where

disposed bottles can be used in the making of other products in five years. The recycling

business is looking forward to immersive growth to penetrate beyond Birmingham city. The

business is expecting to grow its workforce and expand its organization charts. Sales are

expected to grow by 60% in the next three years. The proposed business is hoping to increase its

production in the next two years and acquire a better production machine with higher capacity.

The company will achieve the set targets by expanding its marketing strategies, accommodating

innovative ideas, and maintaining good customer relations.

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References

Yamaoka, J., & Kakehi, Y. (2013, October). dePENd: augmented handwriting system using

ferromagnetism of a ballpoint pen. In Proceedings of the 26th annual ACM symposium

on User interface software and technology (pp. 203-210).

Kher, A., Mulholland, M., Green, E., & Reedy, B. (2006). Forensic classification of ballpoint

pen inks using high performance liquid chromatography and infrared spectroscopy with

principal components analysis and linear discriminant analysis. Vibrational

spectroscopy, 40(2), 270-277.

Gupta, A. (2017). Project Appraisal and Financing. PHI Learning Pvt.

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Yadav, J., & Yadav, L. (2018). Characterization of ballpoint pen. Research Journal of Forensic

Sciences, 6(6), 1-6.

Krishnakumari, C. (2019). Ballpoint Pen—An Eponymous Invention.