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Commercialization of Biotechnology Products BIOT-305 Topic: Production of Citric Acid at Commercial Level GROUP LEADER Hafiza Madeha Khaliq (11-10033) 1 Introduction: Citric acid is one of the most important organic compounds which are produced by fermentation. It is widely used to impart a pleasant, taste and flavor to foods and beverages. It also has a function as an additive in detergents, pharmaceuticals, cosmetics and toiletries. On average, 64% of citric acid produced is used for food and beverages, 22% for detergents and cleaning products, 10% for pharmaceuticals and nutritional products, 2% in cosmetics and toiletries while rest of the 2% is used for other different purposes. Citric acid is the component of bones and it is used in food coloring to balance the pH value of a normally basic dye because of its acidic nature and buffering capacity. History: Wehmer observed the citric acid fermentation for the first time in 1893 as a fungal product by a culture of Penicillium glaucum on sugar medium. Then he isolated two new fungal strains having the ability to accumulate citric acid after few years but the contamination problem and long duration of fermentation made the industrial production of citric acid unsuccessful. In 1916, Currie found various strains of Aspergillus niger that had ability to produce significant amount of citric acid. Two other most important findings were: 1) Aspergillus niger grows well at pH value around 2.5 to 3.5 2) High concentration of sugar favors citric acid production. As a result, first citric acid fermentations were carried out in surface culture in 1930. Some units were implanted in England, Soviet Union and Germany for commercial production. World Production and Consumption of Citric Acid in 2009: Pie chart given below shows the world consumption of citric acid. 2 Citric acid is produced and consumed through out the world. The data shown above is of year 2009. Worldwide production of citric acid is around 1,600,000 tones per anum. The majority of the production and consumption in 2009 was in Western Europe, US and China. It is estimated that nearly 80% of the global citric acid is consumed by Western Europe, Eastern Europe, US, China, Central Europe and Asia. The citric acid industry is continuously influencing by an increase supply form China in an abundant global capacity. In Asia, the consumption is highest in India, Indonesia, Thailand and republic of Korea. More than 50% of the citric acid is produced in China and production of citric acid in china is mainly exported to United States, Japan, Belgium, Netherlands, India, Spain and other countries. Natural Sources of Citric Acid: Citric acid is found in variety of citrus fruits, vegetables. Lemon and lime have higher concentration of citric acid which is about 47g/litre in juices of these fruits. Krebs cycle is the natural process of production of citric acid in all living cells. Krebs Cycle: Krebs cycle is a series of enzyme catalyzed reactions that occurs in cytosol of prokaryotes and mitochondrial matrix of eukaryotes. This metabolic pathway is actually one of the three major pathways of cellular respiration. The other two are glycolysis and electron transport chain. It is also called citric acid cycle or tricarboxylic acid cycle (TCA). Pyruvate is produced at the end of glycolysis which is an energy rich compound and plays important role in ATP synthesis. It enters in Krebs cycle through a transition reaction that connects glycolysis with Krebs cycle. In this reaction pyruvate is converted into acetyl-coenzyme A and carbon dioxide is released. This is an oxidation reaction. Electrons are also released form pyruvate. This acetyl-CoA which is a two carbon 3 compound joins with a four carbon compound called oxaloacetate. As a result citric acid is produced in the first step (a six carbon compound) that’s why Krebs cycle is called citric acid cycle. This cirate is then converted into isocitrate which is then oxidized and decarboxylated to a five carbon compound called alpha ketoglutarate. During this reaction, most of the electrons released are accepted by NAD and NADH is formed which carries electron to the electron transport chain and carbon dioxide is released. Alpha ketoglutarate is oxidized and decarboxylated to succinyl-CoA. This step produces NADH and Carbon dioxide. Succinyl-CoA is a high energy compound which has a high energy bond coupling the Coenzyme A component to the succinate. When this bond breaks, it releases its high energy to make a high energy phosphate bond which is used to form ATP by substrate level phosphorylation. Infect, succinyl-CoA reacts with GDP (guanosine diphosphate) to form GTP (guanosine triphosphate) which in return reacts with ADP to make ATP. At the end, succinate is formed which is a four carbon compound. Succinate is then dehydrogenated and electrons are released which are accepted by FAD to produce FADH which also provide electrons to the electron transport system. Fumarate is the product of this reaction which is a four carbon compound. Fumarate is converted into malate (a four carbon compound) in the presence of water. Malate is oxidized and oxaloacetate is formed and this oxaloacetate serves as a substrate for the restart of the Krebs cycle. In Krebs cycle, at each step a different enzyme is used as shown here: 4 The input and output of Krebs cycle per glucose molecule as follows Input 2-acetyl groups 6 NAD+ 2FAD 2ADP+ 2Pi Output 4CO2 6NADH 2FADH2 2ATP How Could be Krebs Cycle used for Citric Acid Production? As citric acid is one of the intermediates that is produced in TCA cycle so if use the whole cycle for citric acid production, it increases cost and leads to loss of resources and time. In order to maximize the citric acid production, we can follow various points; o Mutation cause by using various mutagens for example gamma radiations in the organism used can be helpful. o Inhibiting the free flow cycle by changing the environmental conditions e.g., temperature, PH and media composition can be another effective way. o Removal of the metal ions that act as co-factors for various enzymes used in unnecessary steps of Krebs cycle cab also be fruitful. o Using inhibitors for enzymes used in unnecessary steps of the Krebs cycle is another good option. Microbial Production of Citric Acid: There are number of microbes that have been used for citric acid production. Some of the examples are; i. ii. iii. iv. v. vi. vii. viii. ix. x. Arthrobactor paraffines Bacillus lichenopromis Corynebacterium ssp. Aspergillus niger A. acucleatus A. Carbonarius A. awamori A. foetidus A. fonsecaeus A. Phoenicis 5 xi. xii. xiii. xiv. xv. xvi. xvii. Penicillium janthinellum Candida tropicalis C. oleophila C. guilliermondii C. citroformans Hansenula anamola Yarrowia lipolytica However most of these are unable to produce citric acid commercially. Microorganisms of choice: “Aspergillus niger”: Aspergillus Niger is a fungus that is included in Aspergillus subgenus, Circumdati. It is considered as the organism of choice for the commercial production of citric acid because of a number of reasons. i. ii. iii. It produces more citric acid per time unit so it provides high yield of citric acid. It is easy to handle. It has ability to ferment a verity of cheap raw materials. Aspergillus Niger is a fungus that is one of the most common species of genus Aspergillus. In 2006, the World Health Organization found that Aspergillus Niger derived organic acids are not only safe to consume but they also have anticarcinoganic and antiangiogenic (tumor reducing) properties for instance actibind. How to grow Aspergillus niger in Laboratory? The US department of Agriculture’s Agriculture Research Service Culture Collection maintains several strains of Aspergillus niger. After getting that following steps are followed; i. ii. iii. iv. v. vi. vii. viii. 39 gm of agar is dissolved in 1 liter water in a clear beaker. Mixture is heated to dissolve the agar completely. It is stirred with a sterile glass rod. Mixture is sterilized for 15 minutes at 15psi (pounds per square inch). Mixture is cooled approximately to 45 Celsius. It poured it into sterile Petri dishes and allowed to set. It is inoculated with Aspergillus niger by wiping a swab containing the culture across the surface of agar. Inoculated petri dishes are stored upside down at 25 Celsius with the agar on the upper surface. Substantial colonies take 5 to 7 days to develop. 6 Side effects of using Aspergillus niger: Aspergillus Niger is a known allergen that causes allergic reactions if inhaled. According to the environmental protection agency at epa.gov, the antigen that causes lung hypersensitive and produces these reactions is found in the strains which are used in industrial applications. In severe cases, A. niger also causes asthma and aveolitis (inflammation of the lung’s air sac or alveoli). The fungus Aspergillus niger can also take root inside the human body for example pulmonary cavity where the wind pipe branches off into lungs. This condition is termed as aspergillosis and can have terrible side effects for example chronic coughing and coughing of blood (hemoptysis) and it commonly occurs in individuals suffering from immune system deficiency. This problem can be solved by using mutant strains of A.niger. Improvement of Strains: The improvement of strains for enhanced citric acid production has been carried by mutagenesis. Different mutagens are used to induce mutation in parental strains and mutants of Aspergillus niger are used for commercial production. Hyper producer strains can be obtained by using ultra violet radiations and chemical mutagens together. Different methods of fermentation used can produce different yields of citric acid even if same strain is used. For example, in Institute of Food and Production Biology in Dhaka, several high citric acid producing strains of Aspergillus niger have been prepared with the help of gamma radiations. These mutant strains have been found to yield three to five times more citric acid from molasses then their parent strain (CA16). Substrates: Citric acid is produced by fermentation using inexpensive raw materials using crude natural products such as hydrolysate starch, sugarcane broth and byproducts like sugarcane and beet molasses. Molasses is preferably used as a source of sugar for microbial production of citric acid due to its relatively low cost and high sugar content (40 to 55%). Since it is a byproduct of processing of sugarcane, grapes or sugar beets into sugar, that’s why its quality varies considerably. Main carbohydrates are glucose, fructose, raffinose and some other oligo- or polysaccharides. All types of molasses are not suitable for citric acid production. The composition depends on various factors; i. ii. iii. iv. Variety of beet and cane Method of cultivation Condition of storage Transport 7 Both beet and cane molasses are suitable for citric acid production, however, beet molasses is preferred due to its lower content of trace metals and it supplies better production yield than cane molasses. In case of cane molasses, it contains some metals such as iron, calcium, magnesium, manganese, zinc etc. which retard citric acid synthesis and that’s why it requires some pretreatment for the reduction of these metals, which increase the cost. So beet molasses is preferred and addition of phytate at the beginning of incubation of beet molasses results in about three fold increase in citric acid accumulation. Phytate is a stored form of phosphorus in plant tissues especially in brain and seeds. Citric acid production techniques: Citric acid production by fermentation is most economically and widely used way of obtaining this product. More then 90% of the citric acid produced in the world is obtained by fermentation. It has certain advantages: i. ii. iii. iv. Operations are simple and stable Plant is less complicated as it requires less sophisticated control system Lower energy consumption is needed Power failures don’t critically effect the functioning of the plant In this process, organism is grown in liquid medium which is vigorously aerated and agitated in large tanks called fermenters. This liquid media is a rich nutrient medium required by A.nigar to grow. The growth conditions maintained are different according to the organism used i-e. Mutant A.nigar require different conditions to grow as compare to the natural A.nigar. So in batch fermentation, A.nigar is grown in a know amount of culture medium for a defined period of time and then cell mass is separated from the liquid before further processing .While in continuous culture, the mass is separated depending on rate of product formation and inflow of fresh medium. As batch culture is used for citric acid production, so it requires 5-15 days depending on the process conditions. Phases: Citric acid production by fermentation can be divided into three phases: i. ii. iii. Preparation and incubation of raw material Fermentation Recovery of the product Fermentation types: The industrial citric acid production can be carried out in three different ways; 8 i. ii. iii. Submerged Fermentation Surface Fermentation Solid state Fermentation Methods of choice: “Submerged fermentation” This technique is widely used for citric avid production and about 80% of world production is obtained by submerged fermentation. Batch or continuous, both can be used for citric acid production but batch culture is more frequently used. Chemical requirements: i. Carbon Source : Presence of carbohydrates is essential for good production of citric acid. Type and concentration of carbon source is really important because it must be easily metabolized. Sucrose is more suitable carbohydrate. Glucose, glactose and fructose can also be used. Cost and need of pretreatment must be taken into account for choosing carbon source. Molasses has some trace elements which must be pretreated by Potassium Ferro cyanide. ii. Phosphorous Source: The level of phosphate has positive effects on citric acid production. Phosphorous level affects the level of enzyme activity. But excess of phosphorous leads to a decrease in CO2 fixation which in turn increases the sugar acids formation instead of citric acid. Potassium dehydrogen phosphate is used as phosphorous source. iii. Nitrogen Source: Nitrogen source is also required for citric acid production. Concentration and nature of the nitrogen source needs to be taken care of. Preferred nitrogen sources include: i. ii. iii. iv. v. Urea Ammonium nitrate Sulphate Malt extract Peptone etc. 9 Acid ammonium compounds are preferred as they decrease the pH which is important fir citric acid production. Concentration of nitrogen source requires ranges from 0.10.4g/L. But high nitrogen concentration increases fungal growth and sugar consumption. As a result, citric acid production is decreased. iv. Trace elements: Presence of trace elements has a significant impact on citric acid accumulation by A.niger. Divalent metal ions such as zinc, manganese, iron, copper, magnesium etc increase the citric acid production when used in trace amount. Control of these trace elements is very important to get maximum yield. v. Lower Alcohols: Lower alcohols e.g. methanol, ethanol, n-propanol, iso-propanol, methyl lactate etc. when added to the crude carbohydrates enhance the production of citric acid by neutralizing the negative effects of metals. Alcohols principally act on the membrane permeability in microorganisms and affect the phospholipids composition by disrupting the ion channels in plasma membrane. As a result balanced osmotic environment is disturbed. vi. Antifoams: These are the substances which are used to reduce the foam formation during citric acid production. Oils and fats e.g. linseed oil, tung oil, linolenic acid etc. are used as antifoams which control the foam formation, maintain the fermentation process and enhance the citric acid productivity. Physical Factors: i. pH: Maintaining the optimum pH is very important to get maximum production of citric acid. pH of a culture changes in response to the microbial activities. Secretion of organic acids such as citric acid is one of the most obvious reasons which cause the decrease in pH. So change in pH kinetics is mainly dependent upon microbes. Nature of the substrate and production technique also influences the pH. Buffer solutions are used to maintain the optimum pH (3.5-4.5). ii. Aeration: Citric acid production is an aerobic process, so proper oxygen supply is required for this purpose. Increased aeration rate enhances the yield and reduces the time period required for the completion of the process. It is important to maintain the dissolved oxygen 10 concentration as its reduction or absence can be highly harmful. Proper aeration devices are required to fulfill this demand. Oxygen demand is dependent upon the viscosity of fermentation broth. However, high aeration rate can lead to the high foam formation during the extensive microbial activity. Antifoaming agents are used to avoid this problem e.g. oils and fatty acids. iii. Temperature: It is important to maintain the optimum temperature during the fermentation process for the production of citric acid that ranges from 30-32 Celsius, depending upon the type of organism used. Fermenter Design: Stainless steel fermenter is used for citric acid production as it does not corrode or affect the microbes and fermentation products. It can easy be cleaned. All the nutrients and microbes are put into the fermenter and air is bubbled through to assist the microbial aerobic respiration. Gas outlet is there which helps to release the pressure build up inside because of CO2 production. A water or cooling jacket is there to maintain the optimum temperature as temperature rises because of different microbial activities. Paddle stirrers are there to provide proper agitation, and to make sure that nutrients are distributed evenly. Temperature, pH and oxygen are linked to a computer which monitors all the parameters or conditions inside and makes it easy to maintain them. There is an outlet at the end from where the product is run off, and it is separated from the microbes and purified for sale and distribution. 11 Extraction of citric acid After the fermentation process the next step is the extraction of citric acid from fermenters. The extraction begins with the filtration of broth until it is cleared. Calcium citrate is precipitated by the addition of magnesium-free. Since magnesium is more soluble then calcium, some acids may be lost in solution as magnesium citrate if magnesium is added. Then in the next step calcium citrate is filtered and the filter cake is treated with sulfuric acid to precipitate the calcium. The dilute solution containing citric acid is purified by treatment with activated carbon and passing through iron exchange beds. The purified dilute acid is evaporated to yield crystals of citric acid. Further purification may be required according to our own requirement. From here the citric acid is packed and transported to the different locations Applications of Citric acid: The citric acid is a naturally occurring weak acid. Its weakness makes it extremely beneficial and useful for all manner of applications as it can be easily handled and ingested by both people and animals. Citric acid is mainly used as flavor enhancer for beverages. It helps in tenderization of the meat by breaking its collagens down to more palatable form. It is an important ingredient of confectionaries and other food products. It acts as an antioxidant also for the readymade food e.g. tinned meat, vegetables and fruits to preserve them. It is used in the manufacturing of detergents for the cleaning purpose. It attracts and removes the dirt and many other stuck-on messes from the cloth. Citric acid is a good buffer so is used in household cleaners to control PH. It can chelate the metal ions so it is also useful in soaps and laundry detergents by letting them to produce foam and work efficiently. I t is also beneficial for the purpose of water softening. It is also used for the purpose of drafting and designing e.g. ferric ammonium citrate is used to produce blueprints. This paper is placed under any drawing, when paper reacts with light, the ferric ammonium citrate changes to ferrous salt as a result blue color is produced. In photography, the sodium citrate, with the help of other chemicals transforms the light-responsive areas into photographs. After the photo paper that is coated with light sensitive chemicals is exposed to light through a negative is placed in a series of tubs of citric acid that forms the picture on photo paper from negative. 12 It is also an important constituent of pharmaceuticals and especially diet supplements e.g. vitamin supplements. Citric acid or its salts enable the minerals in the supplements to be biologically available for the body to use up. It is very important in the treatment of alcoholics so it can also be used to minimize the negative effects of alcohol e.g. in perfumes, cough syrups, shaving lotions etc. Citric acid prevents blood clotting so, it is very helpful in open-heart surgery to stop heart contractions and make the surgery easier to perform. Potassium citrate is used for this purpose. It also acts as a binding agent in biodegradable detergents. It is used to mask fowl smelling also. 13 Company Profile Management Team: The management of ‘Premium Citrus Company includes; Dr. Kausar A.Malik Mr. Syed Ahmad Hashmi Hafiza Madeha Khaliq Samraiz Hafeez Faiza Asghar Haider Khaliq Moaaz Aqeel Alina Rafi Madiha Mehmood Sohail Murtaza Raafia Ramzan Sehrish Process Consultant Marketing Consultant Chief Executive Officer (CEO) & Project manager GM of Sales & Marketing GM of Production Recovery Manager Quality Controller Auditor HR Officer Labour officer Finance Manager Sales Representative Sales Representative Compensation and Ownership: Premium Citrus Company functions as an enterprise. The salaries of the management team are listed below. Profit goes to owners. Process Consultant Marketing Consultant Chief Executive Officer (CEO) & Project manager GM of Sales & Marketing GM of Production Recovery Manager Quality Controller Auditor HR Officer Labour officer Finance Manager Sales Representative Labour 14 Rs. 200000 Rs. 200000 Rs. 250000 Rs. 150000 Rs. 150000 Rs. 150000 Rs. 100000 Rs. 75000 Rs. 50000 Rs. 30000 Rs. 75000 Rs. 20000 Rs. 7000-15000 Board of Directors: Dr. Kausar Abdullah Malik Mr. Syed Ahmad Hashmi Dr. Hamid Saeed Prof. Athar Azeem Process Consultant Marketing Consultant Environmentalist Sociologist Contracts and Agreements: Premium Citrus Company Private Ltd. has the following certificates and agreements on file; Kohinoor Sugar Mills Limited, Company Lahore. R&L International (Shanghai)Co.Ltd CHANDRASHEKHAR Exports PVT. Ltd. Unique Biotech Ltd. India Sabro technologies private limited Pakistan. Pakistan Beverage Ltd. Popular Food Industries Ltd. Shan Food Industries. (Pvt.) Ltd. Abbott Laboratories Pak Ltd. Pakistan Refinery Ltd. Analytical Technologies Limited. (Molasses) (Fermenters) (Corn steep liquor) (Aspergillus niger) (Electric equipment) Infrastructure Banking: Pakistan Industrial Credit and Investment Corporation (PICIC) Commercial Bank Limited. Fees are based on the type of transaction. Insurance: State Life Insurance Corporation of Pakistan. Premium citrus company had product liability insurance policy of Rs. 3,000,000 through Pakistan General Insurance Company Limited with a premium of Rs. 30,000 per month. Capitalization: 15 Premium Citrus Enterprise relies on National Business Incubation Association (NBIA) to fund its operations and capital expenditures. The company's future capital requirements will depend on numerous factors including its own efforts and the efforts of its collaborative partners to commercialize its product. Product and Service plan Purpose of the Product: Citric acid of Premium Citrus has an important use in, hospitals, home care units, food, beverages, chemical industries and other health care facilities. Our basic purpose is to make Pakistan self sufficient in citric acid production for its progressive economy. Unique Features: Citric acid, product of Premium Citrus Company, is useful in shampoos, soaps and laundry detergents as a cleaning agent. It is also used in pharmaceutical, food and beverage industries as a buffering and flavoring agent respectively. It enhances the shelf life of the products so it is a good preservative. It is an important ingredient of dairy products e.g. cheese etc. The citric acid in lemon juice can cure heartburn, bloating and belching, aids digestion and prevents constipation. Stage of Development: Premium Citrus Company Pvt. Ltd. has been founded in 2010 and its corporate offices are in Pakistan. Its first commercial citric acid has been produced in May 2011. Premium Citrus Company is a chemical company that manufactures and markets all pure citric acid by patented fermentation technology. Our customer market includes cosmetic, food, medicine, detergent and beverage market at national as well as at international level. Future Research and Development: Premium Citrus Pvt. Ltd. believes that its products’ functionality will make them potential candidates for future development in its manufacturing technology. We have an access to leading authorities in microbiology, industrial biotechnology, and fermentation technology and govt. agencies so in future we intend to provide facilities for the experimentation, analysis and technological innovations at the basic research level. Trademark, Patent and License: Premium Citrus Company uses trade mark, patent and trade secrets to exclude others to know its proprietary technology. We had filed applications in Initial Public Offering and got utility patent in Pakistan regarding the composition of medium, and the fermentation technology that has been used to manufacture citric acid. Premium Citrus Company also believes that its trademark, trade name is valuable asset and is under protection. Product and Service Limitations: 16 Contact with dry citric acid or with concentrated solutions can result in skin and eye irritation, so protective clothing should be worn when handling these materials. Products of citric acid may not be for extensive or regular use. They can give some people heartburn, nausea, vomiting, and stomach pain and can also damage the enamel on their teeth. In some cases, there may be confusion, anxiety, weakness, irritability and mood changes. Customers should consult a physician before consuming such products extensively. Production Steps: Production of citric acid by Premium Citrus Company follows the steps given below; Procurement of raw materials Growing A. niger in Laboratory Citric acid Production by batch submerged fermentation Harvesting of Product Filtration Disposal of wastes Purification of product Recovery Drying or crystallization of citric acid Final formulation Testing (3-5 days) and Quality control (7-10 days) Note: The Quality Control Department has the authority to release or discard the product. Packaging and Labeling Shipping after release from quality control or Storage. Advertisement and Marketing Facilities: Premium Citrus Company believes that all of its manufacturing plants, laboratory facilities, and laboratory equipment are in satisfactory condition and are appropriate for the purposes for which they are under use. Suppliers: Premium Citrus Company has annual purchase contracts for raw materials and manufacturing equipments. Fermenters are imported from U.K Company R&L International (Shanghai) Co. Ltd. Aspergillus niger kit is obtained from Indian company named as Unique Biotech Ltd. Premium Citrus Company has got raw molasses from Kohinoor Sugar Mills Limited, Company Lahore. Plastic ware and glassware are obtained from PIN TECH INSTRUEMENTS Pakistan and Analytical Technologies 17 Limited. All these supplies are based not only on the lowest price but also on timely shipping. Environmental Factors: Citric acid is recognized as safe for use in food by all major national and international regulatory agencies as it is naturally present in almost all forms of life and its excess amount is readily metabolized and eliminated from the body. All waste materials produced at the end have check and balance system. Waste materials released in the environment have values lower than those of NEQ values so our production plant is environmental friendly. Market Plan Current size: Premium Citrus Company covers an area of 3 acres, currently. Growth potential: Premium Citrus Company is going to be the first production company for citric acid in Pakistan. All local and industries including food, detergent, beverages, and wherever the citric acid is used depend upon foreign countries for its supply. We believe that our revenue opportunity would be huge especially at national level. Premium Citrus Company also aims to export its high quality citric acid in the foreign market. The company also hopes to have marketing arrangements with other well-placed companies by the end of 2011. Geographical Locations: Premium Citrus Company is located near located in industrial area present near the EME housing society, Lahore and product is supplied primarily to the domestic and foreign distributors as well as industries. Trends: As consumption of citric acid in Foods, personal care products and especially in beverages is increasing day by day, so opportunities are arising for citric acid manufacturers too to increase its supply for more profit. 18 Seasonality factors: Citric acid is mostly used in beverage industries and beverage industry production rate increases in summer season so citric acid demand also increases in summer. Rise and fall graph of demand and supply of citric acid also reveals the same thing. Profit: The sale of citric acid directly to the beverage industries carries the highest profit margin. Citric acid sold to the domestic beverage, food and pharmaceutical companies carries an average profit of 20% while 35- 40% average profit has been estimated on the foreign export. Distribution: Premium Citrus Company has made an exclusive distribution agreement covering all companies in Pakistan. Competitors: As Premium Citrus Company is the leading provider of citric acid in Pakistan, so recently it’s not facing any competitor from inside but competition is intense at the International level. The major competitors of Premium Citrus Company include Asian countries, India, China, U.S., U.K. and Western Europe in terms of product quality and sale in Pakistan. Customers: Every person and every industry that is willing to use our product are our customers. Target Market: Target Market of Premium Citrus Company includes beverage, pharmaceutical, food industries, cosmetic and chemical companies and detergent manufacturing industries. 19 Pricing Profile: Premium Citrus Company also provides discount for annual contracts. Introductory offers are available during the first year of the product being marketed. Price of the product=Rs. 200 /kg Market Penetration Sales Representatives & Direct Sales Force: Premium Citrus Company has a marketing department with a general manager and twenty sales representatives who promote the product sale using a number of direct and indirect ways. Direct mail/Telemarketing: Premium Citrus Company has employed telemarketers to reach that market where reach of direct sales force is not possible. Advertisement: Premium Citrus Company is using the internet facility to market its product. The website is www.pakcitricacid.com. Packaging and Labeling: Premium Citrus Company has a trademark of muscular orange with name of the company “Premium Citrus” on its label written in its unique style. Labeling depends on type of the material being used for the packing. Citric acid is packed in plastic packets and containers. Packaging stuff is environment friendly. Each packet or container has complete information of proper use of the product, its limitations, company contact information, and supporting detail. Services and Warranties: 20 Premium Citrus Company will fully refund when the unused product is returned with a written description. Toll free number is also available for both technical information and customer service assistance. Receiving Orders: In our company orders are taken by Phone, fax, e-mail and mail-in orders are received in the Customer Service Department. Then these orders are entered into computer for immediate processing. Once the product has been produced it is checked by quality control department to maintain the best quality and to avoid complains. Billing the Customers: Customers are billed net 30 days with a 1% discount for orders paid within 10 days. A credit check is done on all new customer accounts. Paying the Suppliers: We pay the suppliers 20% before the supply and 80% after one month until we don’t check the quality of raw material. Because our whole process of fermentation depend upon the quality of raw material provided. If the raw material is not according to our requirement our whole process will become useless. Reporting to Management: Weekly staff meetings are held by the General Manager of each section of the company, such as research & development, administration, and sales and marketing. Employees are to report all incidents of concern to their respective GM. It is then the responsibility of that GM to inform the CEO to determine if any action is to be taken. Handling Warranties and Returns: The company maintains both Technical Service and Customer Service Departments. Performance-based customer concerns are handled by the Technical Service Department. The Customer Service Department handles non-performance customer concerns, such as product leakage, mishandled orders, frozen or overheated product, short orders, etc. Security Systems: Sensitive documents are stored on site in a fireproof locked cabinet. Back-up tapes of computer Information are made nightly and duplicates are stored off site. Petty cash is stored in the company safe. An alarm system with password entry has been installed to avoid any type of inconvenience. 21 Product Development: New product development occurs when requested by customers. We can use different strains of A.nigar to have better yield and good quality, we can also cause mutations in A.nigar e.g. by exposing it to radiations, we can also insert new gene in this organism by genetic engineering which may help in increasing the yield. Manufacturing: The formation of product takes 5- 15 days. Once the product is made, it is taken to the Quality Control Department for sterility and performance testing. Planning Chart: “Market penetration”: The GM of sales & marketing in collaboration with the CEO set the strategy for market penetration. This strategy will include, but will not be limited to, the decision to use a network of distribution, establishment of sales territories, sales-force training and a schedule detailing the timing of events. Risk analysis: There can be no assurance that our product will continue to be successfully commercialized and accepted for use by people. Because majority of Pakistanis are crazy about products imported from foreign countries. Moreover, there can be no assurance that the interests and motivations of any corporate partner, distributor or licensee would be or remain consistent with those of New Age BIOTECH, or that such partner, distributors or licensees would successfully perform the necessary technology transfer, clinical development, regulatory compliance, manufacturing, marketing or other obligations. Support to the economy: The most important purpose of establishing a company in Pakistan is to provide people with reasonable jobs. It will definitely reduce unemployment and raise our economy. Pakistan will also become independent in production of quality citric acid. Cost Analysis: Profit goes to owners Pays: Process Consultant Marketing Consultant Whole profit Rs. 200000 Rs. 200000 22 Chief Executive Officer (CEO) & Project manager GM of Sales & Marketing GM of Production Recovery Manager Quality Controller Auditor HR Officer Labour officer Finance Manager Sales Representative Sales Representative Labour Materials: Molasses Potassium dehydrogen phosphate Corn steep liquor Stainless steel fomenters Land Building construction Rs. 250000 Rs. 150000 Rs. 150000 Rs. 150000 Rs. 100000 Rs. 75000 Rs. 50000 Rs. 30000 Rs. 75000 Rs. 20000 Rs. 20000 Rs. 7000-15000 Rs. 340000/ ton Rs. 85975/ ton Rs. 9350/ ton Rs. 2,550,000/ Per fermenter (25 fermentors) Rs. 240,000,000 Rs. 50,000,000 Total Fixed Cost=Rs. 353750000 Variable cost=Rs. 355667325 Dead stock value of production=10 tons/day Price of the Product= Rs. 200 /kg 23 Biosafety Regulations There are certain laws for the safety of environment. It’s important for industries to obey them. These laws are for the prevention of environmental hazards. In order to save the environment and keeping the environment healthy, laws were made as the Environmental Protection Act 1997. As the country progresses, the industries become more populated with the production. And as a result of this production, there is a mass increase in the pollution and hazards to the environment also increase. We the owners of Premium citrus Pvt. Ltd obey these laws. Our industry is located on the Multan road-18 km far from Multan road which is an industrial area. The habitation in the surrounding of the factory is very low and no one is directly affected or disturbed by the company. The machinery like fermenters is noise proof so there is zero noise pollution because of the factory. The working of the machinery is totally environmental friendly. The waste produced as a result is majorly in the form of liquid which is released in the environment after passing through a proper treatment channel of the factory. Composters are present in the factory area where the solid waste is treated. The gases and smoke that are released in the environment have the toxicity value less than the NEQ values. Similar is the case with noise and liquid waste produced. The microorganism that is used for the fermentation process is “Aspergillus niger” which is a mutant organism that produces 3-5 times more citric acid than the ordinary A.niger. There are biosafety laws regarding genetically modified organisms; they can undergo changes in their genetic makeup and as a result they can produce secondary metabolites harmful for the environment. The organism we are using is GRAS (generally regarded as safe) which means it does not have any hazardous environmental effects. Our staff and management are completely aware of the rules required for working in a laboratory and obeying them as well by fulfilling all the biosafety. 24