Starting a Business:  Banana Chips Processing

Banana chips are under-ripe bananas which are cut into slices, dipped in syrup solution, dried under the sun or by artificial means, fried, and eaten as snack or dessert. This can be sold both in the local and export markets.

ESTIMATED INVESTMENT COSTS*

Production Cost/Capital Outlay

• Particulars and Cost
  • 100 pcs. under-ripe green bananas @ P3.50/pc. – P350.00
    2 kg. brown sugar @ P34.00/kg  – P68.00         
    1 bottle of honey – P150.00
    50 pcs. lemon @ P0.50/pc. – P25.00
    5 bottles cooking oil @ P15.00/bottle – P75.00
    50 pcs. polyethylene bags @P2.00/pc (for packaging) – P100.00
    1 tank cooking gas – P550.00
    Electricity – P21.10
    Water – P8.45
    Labor – P285.00
    Transportation – P100.00
    1 pc. Slicing knife – P100.00
    1 pc. chopping board – P100.00
    1 pc. plastic bucket for soaking – P50.00
    1 pc. plastic sieve for draining – P30.00
    1 pc. frying pan/wok – P500.00
    1 pc. frying mesh basket – P100.00
    1 pc. weighing scale – P300.00
    1 pc. bag sealer – P300.00
    5 pcs. drying tray (bila-o) @ P80.00/each – P400.00
• TOTAL = P3612.55
• *Based on February 2009 prices

PROCEDURES

1. Peel under-ripe green bananas and evenly slice crosswise 5-8mm thick (saba, latundan or lakatan variety may be used as raw material).
2. Immediately soak the sliced bananas (chips) into citric acid solution (made by mixing 1 part lemon juice with 2-3 parts water) for 3-5 minutes to prevent them from turning brown. Note: The solution can be used twice.
3. Drain chips from the solution using a plastic sieve.
4. Dip the drained chips in syrup solution (done by mixing 1 cup of sugar with 3 cups of boiling water and add 1 cup of honey) for 3-5 minutes.
5. Drain the chips from syrup solution and place them in drying tray.
6. Let the chips dry under the sun for 2 days until texture becomes rubbery soft.
7. Heat vegetable oil in the frying pan to 180 – 200 degrees Celsius and dip the chips until they turn golden brown.
8. Drain the oil from the chips and allow to cool to room temperature.
9. Place the chips in moisture-proof polyethylene bags, label and seal the bags. Place them in a cool place away from direct sunlight.
10. Banana chips are now ready for the market.
11. Source: http:practicalaction.org http:howtopedia.org

ESTIMATED COSTING AND PRICING

A. Product Costing

• Direct cost
  • Particulars Cost
    • Materials:
    • (banana, sugar, honey, lemon, cooking oil, packaging bags) P768.00
    • Cooking gas/day (P 810/15 days) P54.00
    • Electricity P21.10
    • Water P8.45
    • Total Direct Cost P851.55
• Indirect Cost
  • Particulars Cost
  • Labor (P47.50/hr. x 2 hrs./day x 3 days  P285.00
  • Transportation P100.00
  • Processing implements* (knife, chopping board, bucket, sieve, frying pan, mesh basket, weighing scale, sealer, bila-o) P5.15
  • *Applied cost/day (P1,880.00 divided by 365 days)
  • Total Indirect Cost P390.15
• Production Cost
  • Total Direct Cost              P 851.55
    Add: Total Indirect Cost P 390.15
    Total                                  P P1,241.70

    B. Product Pricing            P 124.17
    Total production cost      P 1,365.87
    Add: 10 % mark up
    Total

Estimated Selling Price/pack        P27.32
(Total production cost plus 10%
mark up divided by 50 packs of 100
grams per pack.)

Assumption: 100 pieces bananas of about 10 kgs. can produce 5 kgs. of fried banana chips which yield 50 packs of 100 grams each.

Sources: www.dti.gov.ph