Introduction

Juice is a refreshing drink loved by people all over India, especially during hot summers. While having mixed fruit juice yesterday Juice-nomics became the topic of discussion with Juicewala Bhaiya.

This is what I discovered —————-

Number of Juice & Milkshake orders and price per glass of Juice

On an average daily basis:

• Fresh juice orders: 500 glasses
• Milkshake orders: 200 glasses
• Priced at Rs 40 per glass for fresh juice and Rs 60 per glass for a milkshake

On a monthly basis (assuming 30 days in a month):

• Fresh juice sold per month: 500 glasses x 30 days = 15,000 glasses
• Milkshake sold per month: 200 glasses x 30 days = 6,000 glasses

Raw material costs to make juice per month

1. Fruits

Quantity of fruits consumed per month

• 1 glass of fresh juice requires around 200 grams of fruit on average
• 15,000 glasses x 200 grams = 3,000 kg of fruit per month

Cost of fruits per month

• Cost of 1 kg of fruits is roughly Rs. 100/kg
• 3,000 kg x Rs. 100/kg = Rs 3,00,000 per month

2. Milk

Quantity of milk consumed per month

• 1 glass of milkshake requires around 200 ml of milk
• 6,000 glasses x 200 ml = 1,200 liters of milk per month

Price of milk per month

• Cost of 1 kg of milk is roughly Rs. 50/litre
• 1,200 liters x Rs 50/liter = Rs 60,000 per month

3. Sugar

Quantity of sugar consumed per month

• 1 glass requires 10 grams of sugar
• (15,000 + 6,000) glasses x 10gms = 210kg of sugar per month

Cost of sugar consumed per month

• Cost of 1 kg of sugar is roughly Rs. 45/kg
• Cost of sugar per month- 210kg x Rs 45/kg = Rs 9,450 per month

4. Cups and Straws

• Cost of 1 glass and 1 straw is approximately Rs. 2
• Cost of cups and straws consumed per month
• (15,000 + 6,000) glasses x Rs 2 = Rs 42,000 per month

5. Rent and Utilities

• Rent is approximately Rs 20,000 per month
• Utilities cost approximately Rs 5,000 per month

6. Labour

• Assuming the one labour is paid Rs 12,000 per month (Average daily wage in India stands at Rs 272)

Total raw material cost per month

Rs 3,00,000 (fruit) + Rs 60,000 (milk) + Rs 9,450 (sugar) + Rs 42,000 (cups and straws) + Rs 20,000 (rent) + Rs 5,000 (utilities) + Rs 12,000 (labor)

= Rs 4,48,450 per month

Profit and Profit Margin

Total Revenue from fresh juice: 15,000 glasses x Rs 40 = Rs 6,00,000
Total Revenue from milkshake: 6,000 glasses x Rs 60 = Rs 3,60,000
Total Revenue per month: Rs 6,00,000 + Rs 3,60,000 = Rs 9,60,000

Total Cost: Rs 4,48,450 per month

Profit: Rs 9,60,000 – Rs 4,48,450 = Rs 5,11,550 per month

Annual Profit: Rs 5,11,550 x 12 = Rs 61,38,600 per year

That corresponds to a mind-boggling profit margin of 53.28%

Note- Juicewala Bhaiya mentioned that he is keen on maintaining the best quality

Author: Mahip Kakan through linkedin. Visit his linkedin profile at https://www.linkedin.com/in/mahip-kakan/