Do you want to start a jute bag production company? If YES, here is a detailed sample jute bag manufacturing business plan template & feasibility report.

Jute bag manufacturing business is indeed a profitable and thriving business that an aspiring entrepreneur with the required startup capital can successfully launch and grow from scratch to profitability. If you are interested in starting a jute bag manufacturing company, then you would find this sample jute bag manufacturing company business plan template highly useful.

A Sample Jute Bag Manufacturing Business Plan Template

Industry Overview

Jute is a natural fibre obtained from the bark of the white jute plant or the tossa jute plant. It is also known as the golden fibre owing to its golden and silky shine, and is extensively used in the manufacturing of packaging products and textiles.

Jute material is a natural vegetable fibre which is made from the outer stem and skin of a jute plant. Jute is an incredibly versatile material which also makes up hessian cloth, however, it is most commonly used now for making durable items such as eco-friendly jute bags.

As a packaging material, jute offers advantages such as good insulation, low thermal conductivity and moderate moisture retention. On account of this, jute bags are used as packaging material for bulk goods as well as shopping and gift bags.

IMARC Group’s latest report, titled “Jute Bag Market” shows that the global jute bag market reached a value of US$ 1.8 Billion in 2018, exhibiting a CAGR of around 11.5 percent during 2011 to 2018. According to the report, the market is projected to reach a value of US$ 3.1 Billion by 2024.

The report shows a deep insight into the global jute bag market covering all its essential aspects. This ranges from macro overview of the market to micro details of the industry performance, recent trends, key market drivers and challenges, SWOT analysis, Porter’s five forces analysis, value chain analysis, etc.

The report also provides a comprehensive analysis for setting up a jute bag manufacturing plant. The study analyses the processing and manufacturing requirements, project cost, project funding, project economics, expected returns on investment, profit margins, etc.

Interestingly, the global jute bag industry is currently at a nascent stage with encouraging growth aspects. The demand for jute bags has witnessed a surge over the past few years, particularly in the European Union. This can be attributed to the growing environment consciousness in the region.

The import of jute bags in non-producing countries have also been facilitated by the ban on plastic packaging materials and bags. Additionally, the benefits offered by jute bags such as their biodegradability, durability, low cost, high strength, etc. have further supported the market growth.

Currently, jute sack bags dominate the market, accounting for the majority of the sales volume. The market has further been segmented on a regional basis and includes India, Bangladesh, China and Others. Amongst these, India holds the majority of the share, representing the leading producer of jute bags.

The report has also assessed the competitive landscape of the market and finds that it is fragmented in nature. Some of the key players operative in the market include Aarbur, Ashoka Exports, Hitaishi-KK, Howrah Mills Co, Shree Jee International India and Gloster Limited.

The revenue generated in the industry is heavily influenced by national demand for consumer goods, as the majority of the products that are produced in the industry are sold for downstream use in the fast-moving consumer goods (FMCG) sector.

Over and above, jute bags manufacturing business is a profitable business and it is open for any aspiring entrepreneur to come in and establish his or her business; you can choose to start on a small scale or you can choose to start on a large scale with standard manufacturing factories both in the United States of America and in countries in Asia where you can get cheaper labor and raw materials.

Executive Summary

David Dallas® Jute Bags Manufacturing Company, Inc. is a US registered jute bag manufacturing business that will be located in Pearl City – Hawaii; in an ideal location that is highly suitable for the kind of business we want to establish.

We have been able to lease a facility that is big enough (a 20 thousand square foot facility) to fit into the kind of company that we intend establishing. David Dallas® Jute Bags Manufacturing Company, Inc. will be involved in the manufacturing of a wide range of jute bags.

We are set to service a wide range of clientele not just in the United States of America, but also all parts of the world. We are aware that there are several jute bag manufacturing companies all around the United States of America, which is why we spent time and resources to conduct a thorough feasibility studies and market survey.

David Dallas® Jute Bags Manufacturing Company, Inc. will ensure that all the jute bags that leaves of factory are of the highest quality and highly durable and affordable. We want to build a business that cuts across businesses in the fast-moving consumer goods (FMCG) sector. We have a CRM software that will enable us manage a one on one relationship with our customers no matter how large they may grow to.

David Dallas® Jute Bags Manufacturing Company, Inc. will at all times demonstrate her commitment to sustainability, both individually and as a firm, by actively participating in our communities and integrating sustainable business practices wherever possible. We will ensure that we hold ourselves accountable to the highest standards by meeting our customers’ needs precisely and completely whenever they patronize our products.

David Dallas® Jute Bags Manufacturing Company, Inc. is a family business that is owned by David Dallas and his immediate family members. David Dallas has a B.Eng. in Production Engineering, with over 12 years’ experience in the global jute bag industry, working for some of the leading brands in the United States. He will be bringing in his vast experience to build David Dallas® Jute Bags Manufacturing Company, Inc.

Our Product Offerings

David Dallas® Jute Bags Manufacturing Company, Inc. is in the global jute bag industry to manufacture a wide range of jute bags for clients. We are set to services a wide range of clientele not just in the United States of America, but also all parts of the world.

We will do all that is permitted by the law of the United States to achieve our business goal, aim and ambition of starting the business. Our product offerings are listed below;

  • Customized jute bags for events
  • Jute bags for grocery shopping
  • Carrier jute bags

Our Mission and Vision Statement

  • Our vision is to build a business that will support climate change, preserve the earth and reduce the burden over our natural resources and environment.
  • Our mission is to establish a world – class jute bag manufacturing company whose products will not only be used by individuals and of course both small and big corporations in the FMCG sector in the United States of America, but also be exported to other countries of the world.

Our Business Structure

Our intention of starting a jute bag manufacturing company is to build a standard and one stop jute bag manufacturing company in Pearl City – Hawaii. Although our jute bag manufacturing company might not be as big as Aarbur, Ashoka Exports, Hitaishi-KK, Howrah Mills Co, Shree Jee International India and Gloster Limited et al, but we will ensure that we put the right structures in place that will support the kind of growth that we have in mind while setting up the business.

We will make sure that we employ people that are qualified, honest, customer centric and are ready to work to help us build a prosperous business that will benefit all the stake holders. As a matter of fact, profit-sharing arrangement will be made available to all our senior management staff and it will be based on their performance for a period of ten years or more.

In view of that, we have decided to hire qualified and competent hands to occupy the following positions;

  • Chief Executive Officer (Owner)
  • Factory Manager
  • Human Resources and Admin Manager
  • Merchandize Manager
  • Sales and Marketing Manager
  • Jute bags Designers
  • Accountants/Cashiers
  • Customer Services Executive

Job Roles and Responsibilities

Chief Executive Officer – CEO:

  • Increases management’s effectiveness by recruiting, selecting, orienting, training, coaching, counseling, and disciplining managers; communicating values, strategies, and objectives; assigning accountabilities; planning, monitoring, and appraising job results
  • Creates, communicates, and implements the organization’s vision, mission, and overall direction – i.e. leading the development and implementation of the overall organization’s strategy.
  • Responsible for fixing prices and signing business deals
  • Responsible for providing direction for the business
  • Responsible for signing checks and documents on behalf of the company
  • Evaluates the success of the organization
  • Reports to the board.

Admin and HR Manager

  • Responsible for overseeing the smooth running of HR and administrative tasks for the organization
  • Maintains office supplies by checking stocks; placing and expediting orders; evaluating new products.
  • Ensures operation of equipment by completing preventive maintenance requirements; calling for repairs.
  • Defines job positions for recruitment and managing interviewing process
  • Carries out induction for new team members
  • Responsible for training, evaluation and assessment of employees
  • Responsible for arranging travel, meetings and appointments
  • Oversees the smooth running of the daily office activities.

Factory Manager:

  • Responsible for managing the daily activities in the jute bag manufacturing factory
  • Ensures that proper records of jute materials and jute bags are kept and warehouse does not run out of finished products
  • Ensures that the factory is in tip top shape and easy to locate
  • Controls jute bag distribution and supply inventory
  • Supervises the workforce in the jute bag manufacturing factory.

Merchandize Manager

  • Manages vendor relations, market visits, and the ongoing education and development of the organizations’ buying teams
  • Helps to ensure consistent quality of jute bag making raw materials are purchased and used
  • Responsible for planning sales, monitoring inventory, selecting the merchandise, and pricing orders for vendors

Sales and Marketing Manager

  • Manages external research and coordinate all the internal sources of information to retain the organizations’ best customers and attract new ones
  • Models demographic information and analyze the volumes of transactional data generated by customer purchases
  • Identifies, prioritizes, and reaches out to new partners, and business opportunities et al
  • Identifies development opportunities; follows up on development leads and contacts
  • Responsible for supervising implementation, advocate for the customer’s needs, and communicate with clients
  • Documents all customer contact and information
  • Represents the company in strategic meetings
  • Helps increase sales and growth for the company

Jute Bag Designers 

  • Responsible for designing and manufacturing different types of jute bags

Accountant/Cashier:

  • Responsible for preparing financial reports, budgets, and financial statements for the organization
  • Provides managements with financial analysis, development budgets, and accounting reports
  • Responsible for financial forecasting and risks analysis.
  • Performs cash management, general ledger accounting, and financial reporting
  • Responsible for developing and managing financial systems and policies
  • Responsible for administering payrolls
  • Ensures compliance with taxation legislation
  • Handles all financial transactions for the organization
  • Serves as internal auditor for the organization

Client Service Executive

  • Ensures that all contacts with clients (e-mail, walk-In center, SMS or phone) provides the client with a personalized customer service experience of the highest level
  • Through interaction with customers on the phone, uses every opportunity to build client’s interest in the company’s products and services
  • Manages administrative duties assigned by the human resources and admin manager in an effective and timely manner
  • Consistently stays abreast of any new information on the organizations’ products, promotional campaigns etc. to ensure accurate and helpful information is supplied to customers when they make enquiries

SWOT Analysis

David Dallas® Jute Bags Manufacturing Company, Inc. is in business to become one of the leading jute bag manufacturing companies in the United States of America and we are fully aware that it will take the right business concept, management and organizational structure to achieve our goal.

We know that there are several jute bag manufacturing companies all over the United States of America, which is why we are following the due process of establishing a business. We know that if a proper SWOT analysis is conducted for our business, we will be able to position our business to maximize our strength, leverage on the opportunities that will be available to us, mitigate our risks and be equipped to confront our threats.

David Dallas® Jute Bags Manufacturing Company, Inc. employed the services of an expert HR and Business Analyst with bias in the manufacturing industry to help us conduct a thorough SWOT analysis and to help us create a business model that will help us achieve our business goals and objectives.

This is the summary of the SWOT analysis that was conducted for David Dallas® Jute Bags Manufacturing Company, Inc.;

  • Strength:

Our main strength lies in the high quality of our finished jute bags, the power of our team and the state of the art jute bag manufacturing factory that we own. We have a team of highly trained and experienced jute bag designers that can produce top notch jute bags. We are well positioned in the heart of Pearl City – Hawaii and close to source of raw materials (jute trees) and we know we will attract loads of clients from the first day we open our factory.

  • Weakness:

A major weakness that may count against us is the fact that we are a new jute bag manufacturing company and we don’t have the financial capacity to compete with multi – million dollar companies in the industry when it comes to manufacturing jute bags at a rock bottom prices. So also, we may not have enough cash reserve to promote our business the way we would want to.

  • Opportunities:

The opportunities when it comes to the market for jute bags is vast because jute bags are extremely strong and sustainable. Jute bags can be reused and are very environmentally friendly. Jute bags are 100 percent compostable. The life of a jute bag is much more than those of the plastic bags and paper bags, as they are more stronger, more durable, and maintain their beauty for longer period.

  • Threat:

Just like any other business, one of the major threats that we are likely going to face is economic downturn. It is a fact that economic downturn affects purchasing/spending power.

Another threat that may likely confront us is the arrival of a new jute bag manufacturing company in same location where ours is located. So also, unfavorable government policies especially when it comes to cutting down jute trees may also pose a threat for businesses such as ours.

MARKET ANALYSIS

  • Market Trends

One major trend in the global jute bag industry is that most players are leveraging on the fact that states in the US and even countries of the world are passing legislation that will limit the use of materials such as nylon and polythene bags because of environmental hazard hence jute bags have become a good substitute.

As a matter of fact, the growing pollution from petroleum-based plastics bags and similar products is negatively affecting the environment and it is a worldwide concern responsible for the evolving demand for bags and packaging materials made from jute and other biodegradable plastics.

The increasing dependence of the medical and food industry on environmental-friendly packaging is a notable factor catalyzing the market demand for jute bags and sacks. The intensifying regulations associated to the disposal of traditional plastics in different developed and developing countries is a top factor drawing attention to industry demand for these bags.

Extensive advances made in manufacturing technologies and the use of a variety of additive materials are likely to improve the biodegradability and composability of these plastic sacks and bags, thereby unlocking exciting avenues during the assessment period.

Lastly, as part of marketing strategies, jute bag manufacturing companies now ensure that they go beyond mass production to producing customized jute bags.

Our Target Market

There are hardly any pharmaceutical store, departmental store, and other such businesses that do not make use of jute bags for packaging goods bought from their stores. In view of that, we have positioned our jute bag manufacturing company to service a wide range of clientele in the United States of America.

We have conducted our market research and feasibility studies and we have ideas of what our target market would be expecting from us. We in the global jute bag industry to supply our products to the following fast-moving consumer goods (FMCG) organizations;

  • Departmental Stores
  • Groceries Stores
  • Pharmaceutical Stores
  • Smartphones and Accessories Stores
  • Supermarkets
  • Boutiques
  • Shoe manufacturing companies
  • Fast food restaurants
  • Mobile phones and accessories stores

Our Competitive Advantage

A close examination of the global jute bag industry reveals that the market has become much more intensely competitive over the last decade. As a matter of fact, you have to be highly creative with your designs and market approach, customer centric and proactive if you must survive in this industry. We are aware of the stiff competition and we are prepared to compete favorably with other leading companies in the United States.

David Dallas® Jute Bags Manufacturing Company, Inc. is launching a standard jute bag manufacturing company that will indeed become the preferred choice for businesses in the fast-moving consumer goods (FMCG) sector both in the United States of America and other countries of the world.

Our jute bag manufacturing company is located in an ideal property highly suitable for the kind of manufacturing company that we want to run. Our ability to negotiate successfully with regulators, optimum capacity utilization and superior financial management and debt management are part of the competitive advantages we will be bringing to the table.

One of our business goals is to make David Dallas® Jute Bags Manufacturing Company, Inc. a one stop jute bag manufacturing company. Our excellent customer service culture, various payment options and highly secured facility will serve as a competitive advantage for us.

Lastly, our employees will be well taken care of, and their welfare package will be among the best within our category in the industry meaning that they will be more than willing to build the business with us and help deliver our set goals and objectives. We will also give good working conditions and commissions to freelance sales agents that we will recruit from time to time.

SALES AND MARKETING STRATEGY

  • Sources of Income

David Dallas® Jute Bags Manufacturing Company, Inc. is in business to manufacture and supply jute bags in the United States of America and other parts of the world. We are in the global jute bag industry to maximize profits and we are going to ensure that we achieve or business goals and objectives.

David Dallas® Jute Bags Manufacturing Company, Inc. will generate income by selling the following products;

  • Customized jute bags for events
  • Jute bags for grocery shopping
  • Carrier jute bags

Sales Forecast

The global jute bag industry is one industry that cuts across various manufacturing industries especially players in the fast-moving consumer goods (FMCG) sector.

We are well positioned to take on the available market in the United States of America, and we are quite optimistic that we will meet our set target of generating enough income / profits from the first six months of operation and grow the business and our clientele base.

We have been able to examine the global jute bag industry, we have analyzed our chances in the industry and we have been able to come up with the following sales forecast. Below are the sales projection for David Dallas® Jute Bags Manufacturing Company, Inc., it is based on the location of our business and other factors as it relates to jute bag manufacturing startups in the United States;

  • First Fiscal Year (FY1): $250,000
  • Second Fiscal Year (FY2): $350,000
  • Third Fiscal Year (FY3): $600,000

N.B: This projection was done based on what is obtainable in the industry and with the assumption that there won’t be any major economic meltdown and there won’t be any major competitor manufacturing or retailing same jute bags as we do within same location. Please note that the above projection might be lower and at the same time it might be higher.

  • Marketing Strategy and Sales Strategy

Before choosing a location for David Dallas® Jute Bags Manufacturing Company, Inc. we conducted a thorough market survey and feasibility studies in order for us to penetrate the available market and become one of the preferred choices of businesses not only in Pearl City – Hawaii, but also throughout the United States.

We hired experts who have good understanding of the global jute bag industry to help us develop marketing strategies that will help us achieve our business goal of winning a larger percentage of the available market in the United States of America.

In summary, David Dallas® Jute Bags Manufacturing Company, Inc. will adopt the following sales and marketing approach to win customers over;

  • Introduce our jute bag manufacturing company by sending introductory letters alongside our brochure to manufacturing organizations, retail stores and key stake holders in Pearl City – Hawaii and other parts of the United States
  • Ensure that we manufacture a wide range of types and sizes of jute bags
  • Make use of attractive hand bills to create awareness and also to give direction to our factory
  • Position our signage / flexi banners at strategic places around Pearl City – Hawaii
  • Create a loyalty plan that will enable us reward our regular customers
  • List our business and products on yellow pages’ ads (local directories)
  • Leverage on the internet to promote our products
  • Engage in direct marketing and sales
  • Encourage the use of Word of mouth marketing (referrals)

Publicity and Advertising Strategy

Even though our jute bag manufacturing company is well positioned, we will still go ahead to intensify publicity for the business.

David Dallas® Jute Bags Manufacturing Company, Inc. has a long – term plan of opening our factories in key locations in Asia, South America and Africa which is why we will deliberately build our brand to be well accepted in the United States of America before venturing out.

Here are the platforms we intend leveraging on to promote and advertise David Dallas® Jute Bags Manufacturing Company, Inc.;

  • Place adverts on community based newspapers, radio and TV stations.
  • Encourage the use of word of mouth publicity from our loyal customers
  • Leverage on the internet and social media platforms to promote our business.
  • Ensure that our we position our banners and billboards in strategic positions all around Pearl City – Hawaii
  • Distribute our fliers and handbills in target areas in and around our neighborhood
  • Advertise our jute bag manufacturing company in our official website and employ strategies that will help us pull traffic to the site
  • Brand all our official cars and trucks and ensure that all our staff members and management staff wear our branded shirt or cap at regular intervals.

Our Pricing Strategy

We are aware of the pricing trend in the global jute bag manufacturing industry which is why we have decided to produce various qualities and categories of jute bags.

In view of that, our prices will conform to what is obtainable in the industry but will ensure that within the first 6 to 12 months our products are sold a little bit below the average market price. We have put in place business strategies that will help us run on low profits for a period of 6 months; it is a way of encouraging people to buy into our jute bag brand.

  • Payment Options

The payment policy adopted by David Dallas® Jute Bags Manufacturing Company, Inc. is all inclusive because we are quite aware that different customers prefer different payment options as it suits them but at the same time, we will ensure that we abide by the financial rules and regulation of the United States of America.

Here are the payment options that David Dallas® Jute Bags Manufacturing Company, Inc. will make available to her clients;

  • Payment via bank transfer
  • Payment with cash
  • Payment via Point of Sale Machine (POS)
  • Payment via online bank transfer
  • Payment via check
  • Payment via bank draft

In view of the above, we have chosen banking platforms that will enable our clients make payment for the purchase of our jute bags without any stress on their part. Our bank account numbers will be made available on our website and promotional materials.

Startup Expenditure (Budget)

The bulk of the startup capital will be spent on leasing or acquiring a facility and also in purchasing the needed equipment. Aside from that, you are expected to purchase and service distribution trucks, purchase raw materials, pay your employees and utility bills.

These are the key areas where we will spend our startup capital on;

  • The total fee for registering the Business in the United States of America – $750.
  • Legal expenses for obtaining licenses and permits as well as the accounting services (software, P.O.S machines and other software) – $3,300.
  • Marketing promotion expenses for the grand opening of David Dallas® Jute Bags Manufacturing Company, Inc. in the amount of $3,500 and as well as flyer printing (2,000 flyers at $0.04 per copy) for the total amount of $3,580.
  • The total cost for hiring Business Consultant – $2,500.
  • The total cost for payment of insurance policy covers (general liability, workers’ compensation and property casualty) coverage at a total premium – $9,400.
  • The total cost for long – term leasing of a standard warehouse / factory – $150,000
  • The total cost for remodeling the warehouse / factory – $20,000.
  • Other start-up expenses including stationery ($500) and phone and utility deposits – ($2,500).
  • Operational cost for the first 3 months (salaries of employees, payments of bills et al) – $100,000
  • The total cost for start-up inventory (purchase of tools and equipment and the purchase of raw materials inclusive) – $150,000
  • The total cost for counter area equipment – $9,500
  • The total cost for store equipment (cash register, security, ventilation, signage) – $13,750
  • The total cost for the purchase and installation of CCTVs: $10,000
  • The cost for the purchase of office furniture and gadgets (Computers, Printers, Telephone, TVs, Sound System, tables and chairs et al): $4,000.
  • The total cost of launching a Website: $600
  • The total cost for our opening party: $7,000
  • Miscellaneous: $10,000

We would need an estimate of five hundred and fifty thousand dollars ($550,000) to successfully set up our jute bag manufacturing company in Pearl City – Hawaii.

Generating Funds/Startup Capital for David Dallas® Jute Bags Manufacturing Company, Inc.

David Dallas® Jute Bags Manufacturing Company, Inc. is owned and financed by David Dallas and his immediate family members. They do not intend to welcome any external business partners which is why he has decided to restrict the sourcing of the startup capital to 3 major sources.

  • Generate part of the startup capital from personal savings
  • Source for soft loans from family members and friends
  • Apply for loan from the bank

N.B: We have been able to generate about $150,000 (Personal savings $100,000 and soft loan from family members $50,000) and we are at the final stages of obtaining a loan facility of $400,000 from our bank. All documents have been signed and submitted, the loan has been approved and any moment from now our account will be credited with the amount.

Sustainability and Expansion Strategy

The future of a business lies in the number of loyal customers that they have, the capacity and competence of their employees, their investment strategy and the business structure. If all of these factors are missing from a business, then it won’t be too long before the business closes shop.

One of our major goals of starting David Dallas® Jute Bags Manufacturing Company, Inc. is to build a business that will survive off its own cash flow without injecting finance from external sources once the business is officially running.

We know that one of the ways of gaining approval and winning customers over is to manufacture durable and quality jute bags and to retail them a little bit cheaper than what is obtainable in the market and we are prepared to survive on lower profit margin for a while.

David Dallas® Jute Bags Manufacturing Company, Inc. will make sure that the right foundation, structures and processes are put in place to ensure that our staff welfare are well taken of. Our company’s corporate culture is designed to drive our business to greater heights and training and re – training of our workforce is at the top burner.

We know that if that is put in place, we will be able to successfully hire and retain the best hands we can get in the industry; they will be more committed to help us build the business of our dreams.

Check List/Milestone

  • Business Name Availability Check: Completed
  • Business Registration: Completed
  • Opening of Corporate Bank Accounts: Completed
  • Securing Point of Sales (POS) Machines: Completed
  • Opening Mobile Money Accounts: Completed
  • Opening Online Payment Platforms: Completed
  • Application and Obtaining Tax Payer’s ID: In Progress
  • Application for business license and permit: Completed
  • Purchase of Insurance for the Business: Completed
  • Leasing of facility and remodeling the facility: In Progress
  • Conducting Feasibility Studies: Completed
  • Generating capital from family members: Completed
  • Applications for Loan from the bank: In Progress
  • Writing of Business Plan: Completed
  • Drafting of Employee’s Handbook: Completed
  • Drafting of Contract Documents and other relevant Legal Documents: In Progress
  • Design of The Company’s Logo: Completed
  • Printing of Promotional Materials: In Progress
  • Recruitment of employees: In Progress
  • Purchase of jute bags manufacturing machines and equipment: Completed
  • Purchase of the needed furniture, racks, shelves, computers, electronic appliances, office appliances and CCTV: In progress
  • Creating Official Website for the Company: In Progress
  • Creating Awareness for the business both online and around the community: In Progress
  • Health and Safety and Fire Safety Arrangement (License): Secured
  • Establishing business relationship with vendors – supplier of jute bag making raw materials, key stakeholders and suppliers of jute bags: In Progress.