Ramil Rakhimov, Yokito diapers: “When mom comes to the store, she first of all looks at the price”

Since the birth rate in our country increases every year, the demand for children's products, in particular, disposable diapers, also increases.

Currently, the market for such products is practically not represented by domestically produced diapers, and developing such a business idea is quite promising.

Russian entrepreneurs are hesitant to invest in the production of diapers. However, the high profitability of the diaper production business is beyond doubt .

By investing certain funds in an advertising campaign, you can quickly introduce domestically produced diapers to the domestic market.

If their cost is low compared to foreign analogues, the entrepreneur has every chance of success.

Business registration

Before starting a diaper production, you must first register your business. If it is a small workshop, it is enough to register as a private entrepreneur. For wholesale deliveries in large quantities, an LLC should be opened.

After this, permits should be obtained from the SES and fire inspectorate. Since diapers are products for children, they must meet all sanitary and hygienic requirements. Domestic products should not be inferior in quality to foreign analogues. Therefore, strict controls should be ensured at all stages of production.

Room

You will need less start-up capital to start a business if you own your own building. But most often you have to rent one. To save money, choose it away from the central part of the city, somewhere in industrial areas. But at the same time, make sure that easy access is provided for large vehicles.

The area of ​​the production area is 150-200 sq. m. Separately, it is necessary to allocate a part of the building for storing finished products and utility rooms for staff (bathroom, wardrobe, administration, etc.). Be sure to ensure the availability of communications - ventilation, water, electricity of the required power for the uninterrupted operation of the equipment.

Product varieties

Based on prices, diapers are divided into three categories:

• Premium class;
• Average price range;
• Cheap products.

The most popular products are those of medium price.
Parents who do not have enough money for expensive products buy diapers at an average price because they do not want to save on their children. Depending on the type of dressing, they can be made in the form of panties or fastened with Velcro. Some young mothers are interested in the difference between diapers and diapers. Almost nothing. The only difference is that a diaper is a disposable diaper made by a well-known company. For a long time, this brand was considered a monopolist in the market. Nowadays, it has many competitors, but despite this, many still call diapers diapers.

“Russian banks do not want to lend to startups”

— What were the investments in opening the brand?

— In 2020, the first investments in the beginning and development of the project amounted to 5 million rubles. In 2020, we invested another 20 million rubles. These were own and borrowed funds. The interest on loans is, of course, huge, because we took out loans for individuals. Unfortunately, banks do not want to lend to new business projects that are at the development stage and do not have liquid collateral. They think it's a startup. So, until now, not a single bank in the Republic of Tatarstan has approved a loan for us. Although we work with almost all regions of Russia, we supply products to Kazakhstan, Kyrgyzstan, Belarus, Latvia, and we pay taxes to the budget of Tatarstan. To date, we have received a small loan for development from OTP Bank, and we are negotiating with the Guarantee Fund of the Republic of Tatarstan. We are trying to get a loan from Alfa-Bank. We are also interested in contract lending for supplies to federal chain stores. But, unfortunately, we are always denied loans due to lack of collateral.

— How has the cost of your diapers changed since 2017?

— If the dollar rises in price by one ruble, then 10 rubles are added to the cost of a pack of diapers. Starting in 2020, when the exchange rate was 58 rubles, the cost of one pack of diapers increased by 70 rubles. The current rate is 65 rubles per 1 US dollar.

In 2020, the Yokito brand became more recognizable and consumers began to trust our products more. Repeat purchases are coming

— Did you manage to achieve self-sufficiency?

— Since 2020, our income has covered expenses. But development at the initial stage requires increased costs, so the investments have not yet paid off. Now the business generates profit, which is mainly used for development, covering expenses and interest on loans.

— What was your revenue last year and what do you plan to get this year?

— In 2020, revenue was 3.7 million rubles. In 2020, it increased to 35.9 million rubles. For the first half of 2020 - 30.3 million rubles. We are growing revenue at almost double the rate.

— How did you manage to increase such volume compared to 2020?

— In 2020, the Yokito brand became more recognizable and consumers began to trust our products more. Repeat purchases have begun. Marketplaces are also developing at a rapid pace - Wildberries, OZON, Beru, Goods and others. We sell about half of our products through them.

Equipment

To produce baby diapers you will need complex technical equipment. Each line has its own specific classification depending on speed and productivity. Such diaper production equipment can produce 200–500 products per minute. High-performance units make thousands of units. The highest quality and most reliable equipment is produced by Japanese and Italian manufacturers. One diaper production line can produce products of different sizes. Used equipment will cost much less than new equipment. An average-performance unit costs approximately 5–6 million rubles. You can purchase a ready-made diaper production business with a registered trademark, sales markets and established supplies of raw materials.

If you buy cheap Chinese equipment, you will have to spend a lot of time reloading it. In this case, you should purchase several machines at once that produce different diapers. Chinese lines may have different productivity. The most efficient equipment produces up to 500 pieces of finished products per minute.

Diaper production business in Russia

Despite the fact that in general the Russian diaper market has developed, it has not yet reached saturation. There is a particular shortage of domestic producers. The market for the production of baby diapers includes popular multinational brands and only a few Russian companies. The prospects for business development in the creation of disposable diapers are very successful.

For those who have decided to open their own production, it is important to know some legal subtleties.

The most important thing, especially if the organizational and legal form has not yet been chosen, is to decide on it. Preference should be given to such a form as a limited liability company. It is this choice that will allow us to establish mutually beneficial cooperation with both small companies and large wholesalers. Once you have decided, you need to register. To register you must go through a certain procedure:

1. Select the name of the organization, which must be in Russian and include a legal form, for example, Podguznik LLC.

2. Select a legal address. The tax office to which documents for registration will be submitted will be located at the location of the organization.

3. Select the code of the planned type of activity from a special classifier.

Important!

In the classifier, all codes are given with their decoding, which makes them easy to select. According to the directory, diapers belong to the production of paper products for household and sanitary purposes and have code 17.22.

4. Decide on the amount of authorized capital or contribute its minimum amount of ten thousand rubles. It must be submitted no later than 4 months after registration.

5. Pay a fee to the state in the amount of 4 thousand rubles.

Important!

Since 2020, there have been changes in the payment of duties. Applicants who sent documents through the government services portal or the Federal Tax Service do not pay a fee. This provision is enshrined in law. In this case, the applicant must have enhanced qualified assistance.

6. Determine the taxation system. The chosen method will affect your profit. In the production of diapers there are fixed costs in the form of the purchase of imported raw materials, so you should choose the corporate income tax, which is 15%.

7. Prepare a specific list of documents and take it to the tax office:

· statement;

· decision of the founder (protocol of the founders’ decision);

· company charter;

· receipt confirming payment of the state duty;

· documentation confirming the location at the legal address.

Reference!

The maximum registration period from 2020 is three days.

In addition, to open production it is necessary to obtain permits from the sanitary-epidemiological service and the fire department.

Technological process

There is one technology for producing diapers. These products may differ only in content and shape. They are made up of several different layers. The top covering with which the baby's skin comes into contact is made of non-woven material. For the inner layer, a gelling agent and cellulose are used. Many manufacturers also add sodium polyacrylate. This material holds water well. The bottom layer consists of polyethylene or non-woven material laminated with polyethylene film. A conductive distribution layer is also added to the product composition. Almost all diapers produced in Western countries have it. Thanks to this, the liquid is evenly distributed over the entire plane, after which it passes into the core. To attract the attention of consumers to a product, manufacturers use various fragrances or lotions.

Goon

Diapers made in Japan. Made from natural materials, they are particularly soft. These diapers breathe and never irritate baby's delicate skin. In addition, they are completely environmentally friendly and do not cause allergic reactions. If you evaluate how much they absorb moisture, you can give them four out of five possible points. If we take the convenience parameter, this is a solid five. The elastic waistband and high sides on the sides prevent liquid from leaking. These diapers are suitable for long-term use. The main drawback is that they are only produced for children weighing up to 3 kg and they do not have any moisture indicator. In addition, you rarely see them on the product shelf.

Reusable diapers

For domestic entrepreneurs, the production of reusable diapers can be an excellent business idea. Many consumers are interested in such products. Since the market is not sufficiently saturated with reusable diapers, good money can be made from their production. Modern products are radically different from the diapers that were used a few years ago.

Reusable diapers are very popular. Even wealthy parents, whose financial capabilities allow them not to save on diapers, are happy to buy them. The variety of designs and colors makes these products more attractive.

A closed-loop production line can be operated by just one operator. The machine is filled with raw materials, a program is set and it begins to make money.

Financial calculations

The diaper manufacturing business is quite expensive, so before you start working on implementation, you need to understand the cost and payback of the project.

Start-up capital

Monthly expenses

Subsequent monthly expenses will be significantly less than the starting capital. This is due to the fact that you will no longer need to purchase expensive equipment, which was the main expense item. But it must be borne in mind that repairs may be required at any time.

Monthly expenses will consist of:

• rent (200 thousand rubles including utilities);
• salaries to staff (200-300 thousand rubles);
• advertising (50-100 thousand rubles).
• expenses for raw materials (RUB 5,000 thousand)

How much can you earn?

Obviously, profits will depend on the demand for the product. We will start our calculations from average numbers. Let’s say the machine will produce about 400 diapers per minute per hour. This means that in 1 shift (8 hours) it will be possible to produce approximately 192,000 units of product. The average cost of one diaper is about 5 rubles. Thus, products worth 960 thousand rubles can be made per day, which is 21,120 thousand rubles of gross profit per month (22 working days).

Payback period

The payback period for the production of disposable baby diapers is about 2-3 years.

Raw materials

Children's diapers produced in our country must comply with GOST 52557–2006.
Therefore, the raw materials for the production of diapers must be of high quality so that the finished product is in no way inferior to foreign analogues. In this regard, the cost of products increases significantly. There are practically no sources of raw materials in our country, so manufacturers incur additional costs due to their import from abroad. Most of the funds are spent on customs duties and logistics. To change this situation, the government of the country has reduced the fees on the import of these materials. If you want to reduce the cost of finished products, you can look for suppliers of raw materials within the country or change the components from which diapers are made. But this should not be at the expense of quality. In some cases, even imported raw materials and high-tech equipment for the production of diapers do not guarantee the quality of the finished product. Consumers complain that domestic products leak quickly because they do not absorb moisture well, do not retain odors, and have a high percentage of defects. Therefore, if you want the production of diapers as a business to bring good profits, ensure strict quality control at the enterprise. This is your first priority.

Description of the business idea, its relevance and advantages

Entrepreneurs involved in the production and sale of diapers have high profitability and a good income. The growth rate of this market is at least 10–12% per year. The main factors contributing to the development of such activities are the increase in the birth rate and the promotion of a culture of consumption of children's products. Due to the fact that all these products are subject to periodic updating, they are always in demand. This especially applies to disposable diapers for children; their sales rate is not greatly affected by the level of income of the population.

In modern times, parents give preference to such products in order to eliminate the daily washing of their child’s clothes. In addition, having a diaper for a child is very convenient when walking or visiting a clinic. This solution cannot be called cheap, and it allows businessmen to make good money from this. Since nowadays domestic manufacturers practically do not produce such products, without risking investing in them, a properly organized business of this kind will become promising.

By spending a certain amount of money on promoting a project, you can enter the domestic market with your product in a short time. Provided that the price for domestic diapers will be much lower than for imported analogues, a businessman has many chances to gain recognition from buyers.

Product promotion

As mentioned above, consumers do not have much confidence in domestically produced products.
In this regard, it is necessary to approach the issue of pricing seriously and responsibly. If a package of diapers is sold at the same price as products from well-known brands, you can hardly count on success. On the other hand, high costs for the delivery of raw materials and expensive equipment do not allow prices to be lowered much. Baby hygiene products can be sold through different channels. Pampers are sold in supermarkets, pharmacies, children's stores, etc. To bring your brand to the market, you will have to spend a lot of money on an advertising campaign. If you have opened a mini production of diapers with a productivity of 150–200 pieces per minute, you should not spend money to make a name for yourself on the national market. Sales of products can be established in the region where the enterprise is located.

Features of the finished product - what indicators should diapers meet?

Currently, Russian-made diapers and pampers are not very popular among consumers.
In connection with this factor, when releasing your products, you should pay special attention to their quality in order to attract a certain number of buyers and be able to occupy your niche in such a fairly large business. First of all, you should pay attention to the material from which the packaging for diapers will be made - it must have maximum moisture resistance in order to preserve the products in their original quality. In addition, diapers should be comfortable to wear, this factor is especially important for panties that contain a stretchy elastic band at the waist.

Since the main purpose of the products is to use them for children aged from birth to 3-4 years, no less important indicators are the absence of an unpleasant odor and the complete exclusion in their composition of substances that can cause allergies or otherwise negatively affect child's body.

One of the most important indicators by which parents choose diapers for their children is the combination of the minimum thickness of the diaper, maximum absorbency and lack of leakage. It is if all these factors are present in the product that you will be able to find your buyer and ensure the success of your business.

Raw material base

The quality of the final product largely depends on what material is used to make it. The diaper consists of the following layers:

• Upper - where thermal bond or spunbond is used as a basis, this part is in direct contact with the child’s skin, so it should be as hypoallergenic as possible.
• Internal (medium) - is a filler made of cellulose and various gel-forming components, ensures complete absorption of liquids and their retention inside the diaper.
• Bottom - most often it is a regular polyethylene film or laminated material that prevents the product from leaking.

Manufacturers of premium products are still trying to add an additional layer in order to more evenly distribute the liquid over the surface. Various lotions are also often used to care for the baby’s skin, fragrances to create a pleasant smell, and other impregnations.