Starting a Business in Tomato Catsup Production

Ketchup, (spelled as catsup or catchup) also known as tomato ketchup, tomato sauce, or red sauce, is a condiment usually made from tomatoes. It started as a general term for sauce, typically made of mushrooms or fish brine with herbs and spices called “Ke Tsiap”.

Tomato is classified as a vegetable. However, botanically speaking, tomato is a fruit of the tomato vine. Hence, tomato is both a vegetable and a fruit.

Investment Costs (in Php 2009 prices)

Utensils and equipment:

  • Stainless/enameled kettle  – 800.00
  • Measuring cups & spoons – 70.00
  • Strainer – 155.00
  • Chopping board – 60.00
  • Casserole – 220.00
  • Knife – 140.00
  • Wooden ladle – 52.00
  • Colander – 90.00
  • Juice extractor  (optional) – 5,000.00
  • Total – P6,587

Packaging materials:

  • 330 ml Bottle – 12.50
  • Cap sealer (100 pcs/P20) – 0.20
  • Total – P12.70

Raw materials/ingredients:

  • 4 L tomato pulp (approx. 5 kg)
  • 4 cup Sugar
  • 1/2 tsp Cinnamon powder
  • 1/2 tsp Pepper powder
  • 1/2 tsp Cloves powder
  • 1/2 tsp Paprika
  • 1/2 cup Fresh onions
  • 2 cup Vinegar (4.5% acidity)
  • 2 tsp Sodium benzoate (optional)
  • 3 tbsp Cornstarch dissolved in 1 cup water
  • Total for estimated 13 (330 g) bottles – 100.60
  • Cost per 1  bottle – P7.74

Procedure

  1. Select and wash ripe fleshy red tomatoes.
  2. Blanch tomatoes for 30 seconds, transfer into cold water, peel and cut into halves (crosswise).
  3. Remove the seeds and chop the pulp into small pieces.
  4. Strain the remaining seeds thru a fine mesh screen of strainer (if available, use juice extractor).
  5. Mix the juice with the pulp.
  6. For  every 4 liters of pulp, add the sugar, cinnamon, pepper, cloves, paprika, onion, and then blend.
  7. Place the mixture into a kettle and cook for 1/2 to 2 hours over low flame, stirring constantly to avoid scorching, until the right consistency for catsup is reached.
  8. Add vinegar and sodium benzoate (optional) until nearly cooked.
  9. Add cornstarch previously dissolved in water and cook until right consistency is attained/reached.
  10. Pour while hot in sterilized bottles leaving 1/2 inch headspace.
  11. Seal thoroughly.
  12. Cool, label and store.

Estimated Costing and Pricing (based on 2009 prices)

A. Direct cost (for month (22 days ))

  • Raw materials/ingredients – 26,563.68
  • Packaging materials   – 43,586.40
  • Labor – 8,404.00
  • Total direct cost – P78,554.08

B. Indirect cost

  • LPG, 11 kg/2 months – 250.00
  • Water and electricity (150+200) – 350.00
  • Contingency (10% of direct cost) – 7,855.41
  • Total indirect cost – P8,555.41

C. Production cost

  • A+B (approx 3,432 bottles/month) – P87,109.49
  • Production cost/bottle – 25.38
  • 20% mark-up of the production cost – 5.08
  • Suggested market price/bottle (330 g) – P30.46

Estimated Product Pricing

Market Price of tomato ketchup: from P18.00 (250 g pouch) to P40.85 (567 g  bottle), as of March 2009.

Figures used in this computation are based on February 2009 National Capital Region (NCR) prices and may vary from actual operation of the business.

Packaging materials supplier: Synergos Management, tel: (02) 712-7030, 711-0257

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)
  • DTI-PTTC (www.pttc.gov.ph)
  • DOST, R&D (http://itdi.dost.gov.ph)

source: dti.gov.ph, photo from instructables.com

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