Starting a Business in Kaong Processing

Kaong or sugar palm (Arengga pinnata) is a minor forest species that produces food. Its nuts are made into kaong preserve which is good for dessert or as ingredient in fruit salads and the palm sap is made into vinegar. These products are sold in the local and export markets.

Estimated Investment Cost (in Php based on 2009 prices)

Materials:

  • White sugar, 360 kg @P36/kg – 12,960.00
  • Sodium metabisulfide, 200 grams – 40.00
  • Bottles, 2,880 pcs @ P20/bottle – 57,600.00
  • Plastic sealer, 2,880 pcs @P1/pc – 2,880.00
  • Fuelwood, 100 bundles @20/bundle – 2,000.00
  • Ladle, 2 pcs @P50/pc – 100.00
  • Oil can, 10 pcs (5 gallon capacity) @P50/pc – 500.00
  • Wok – 450.00
  • Strainers, 2 pcs @P200/pc – 400.00
  • Kaong nuts, 1,200 bunches @P60/bunch – 72,000
  • Subtotal – P148,930.00

Labor:

  • Procurement of nuts (3 days/mo @ Php 380/head x 12 mos.) – 13,680.00
  • Cooking and extraction of nuts (6 days/mo @ Php 380/head x 12 mos.) – 27,360.00
  • Sterilization, bottling, sealing @P3/bottle x 2,880 bottles – 8,640.00
  • Subtotal – P49,680.00

Transportation and Utilities:

  • 1,200 kg/mo x 12 @P0.40/kg – 5,760.00
  • Electricity – 7,596.00
  • Water – 3,042.60
  • Subtotal – P10,638.60

Estimated total investment cost – P215,008.80

Procedure

A. Harvesting

  1. Select the bunch having mature fruits. A bunch may contain 4,000-5,000 fruits.
  2. Cut selected bunch using a sharp bolo (30-50 cm) from the main trunk.
  3. Bundle the bunch of the fruits for easy handling and transporting.
  4. Detach individual fruit using a knife. Do not touch the sap as it causes skin irritation.

B. Extraction:

  1. Place the fruits in the container and add water just within the level of the fruits.
  2. Boil for two to three hours.
  3. Cut the tips of the fruit at 1 cm crosswise from the apical portion.
  4. Prick the meat in the upper portion of the fruit using a knife.
  5. Wash the meat with clean water, two to three times to eliminate unnecessary materials.
  6. Soak the meat in water overnight to maintain the freshness.
  7. Strain the meat in the plastic mesh/strainer.
  8. Unsweetened kaong is ready for market.

Caution: Kaong fruits are toxic for dogs.

C. Processing into Kaong Preserves:

  1. Prepare syrup by boiling two cups white sugar, one cup water, and 0.1% sodium metabisulfide.
  2. Add three cups of kaong to the boiling syrup.
  3. Cook for 10 minutes and cool.
  4. Place kaong in a sterilized bottle and seal.
  5. After sealing, boil for another 10 minutes to eliminate the air bubbles.
  6. Label before marketing.

Estimated Costing and Pricing

  • A. Direct cost (materials, labor, water, fuel) – 197,322.60
  • B. Indirect cost (other materials, electricity, transportation) – 17,686.00
  • C. Production cost (A+B) – 215,008.60
  • D. Product pricing (C+10% markup) – 236,509.46
  • Estimated selling price/bottle (D/2,880 bottles of 900g/bottle) – 82.12
  • Market price/bottle of 900g – P85.00 or more

The producer may opt to sell kaong preserves in bottles of varied size.

Registration Requirements

  • Business name registration (www.bnrs.dti.gov.ph)
  • Mayor’s/Business Permit (check your local municipality/city)
  • BIR TIN (www.bir.gov.ph)
  • BFAD Certificate (www.bfad.gov.ph)

Financing Facility

  • People’s Credit and Finance Corp (www.pcfc.gov.ph)
  • Small Business Corp. ([02] 751-1888)

Technical Assistance (Training and Seminar)

  • DOST-STII ([02] 837-2191 to 95, www.stii.dost.gov.ph)

source: DTI-PTTC

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