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Diaper Manufacturer Business Plan

Sample

Diaper manufacturer business plan for starting your own business

Do you want to start a business that would have everlasting demand and scope? If so, you
must start searching about how to start a diaper business. A diaper manufacturing business
works to manufacture diapers and sanitary pads to assist caretakers of children in doing
routine tasks.

The business idea might seem simple but in actuality requires a lot of knowledge about the
equipment required to manufacture diapers. Moreover, an insight into the market trends,
prospective customers, and strategies adopted by competitors will also be needed.

As a first step, you must make a diaper manufacturer business plan. You may study
several business plans for investment to adopt the best strategy to launch your startup. In
this blog, we are providing the business plan of a diaper manufacturer startup, Happy
Hygiene so that you can learn about your potential queries about this business.

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Executive Summary

2.1 The Business

Happy Hygiene will be a full-time business aimed at providing absorbent, comfortable, and
affordable diapers. The business will be based in Maryland and will operate in B2B as well
as B2C mode. It is because sales will be directed to individual buyers as well as retailers
and childcare organizations.

2.2 Management of diaper manufacturer business

The founders of Happy Hygiene understood the importance of a proper management plan
before launching the business. That’s why they hired business plan experts to make a
detailed business plan for their startup.

As for manufacturing, a hierarchy of positions was created to ensure systemic working

conditions. While the owner decided to be the CEO himself, he decided to hire managers
for multiple positions. Besides, several engineers, technical workers, and assistants were to
be hired to maximize efficiency.

In this diaper manufacturing business plan you will find info about how to start a cloth diaper
business. Moreover, you would be able to develop a pampers business plan and compare it
with Happy Hygiene’s diaper business plan.

2.3 Customers of diaper manufacturer business

Since Happy Hygiene will be a B2B and B2C business, our customers will be:

 Parents

 Retail Store Owners

 Daycare Centers

 Child Care & Adult Care Institutes

2.4 Business Target
It is important to set business targets in your business plan even when developing a plan for
simple ideas such as business plan for bottled water business. Setting business targets
helps direct the whole machinery to achieve specific goals.

Business targets of Happy Hygiene were as follows:

 Earning and maintaining an average rating of 4.8 out of 5 on online platforms.

 Spread the business to at least 2 more locations by the end of the first five years.

Company Summary

3.1 Company Owner

The owner of Happy Hygiene is Stephen Hanks. Hanks is an Environmental Engineer with
an additional degree in executive MBA. He has worked as a senior manager at Kimberly-
Clark Corporation for 6 years and possesses both experience and know-how in the diaper
manufacturing business.

3.2 Why the diaper manufacturer is being started

Starting a diaper business can be beneficial in long run. It is because diapers and sanitary
pads are the things that remain in demand no matter what season or month we are in.
Hanks always wanted to step into a business that guarantees potential future and smooth
profit in-flows. Therefore, he launched Happy Hygiene.

3.3 How the diaper manufacturer will be started

Step1: Develop Diaper Service Business Plan

The first step would be to hire researchers to study how to manufacture pampers, prepare a
stepwise strategy, and develop a diapers business plan. If you are thinking about stepping
into this business, the first thing you must do is study diapers business and how to start a
diaper manufacturing company.
Step2: Define Mission Statement and Goals

The second step is to document your expectations from the business. It is to make sure that
you set specific, measurable, and attainable goals while also preparing the strategy to
achieve them.

Step3: Execute Marketing Plan

The next step is to reach out to your target audience. For that, you will have to work out
some advertisement plans. Moreover, social media and online websites can serve as a
great help.

Step4: Establish a Web Presence

Today, establishing a strong web presence has become essential if you want to start any
type of business. Whether it is a coal mine business plan or a business plan for a liquor
store being there on social media and google sites is a must.

In the case of the diapers manufacturing business, people are likely to search about diapers
on the web and read reviews. Thus, in your business plan, it should be emphasized how
you will manage your online presence.

Step5: Build Resources

Lastly, you must create your financial and personnel plan to acquire financial and human
resources for your startup.

Start-up Expenses

Legal $125,300

Consultants $0
Insurance $25,100

Rent $32,500

Research and
$10,000
Development

Expensed Equipment $52,200

Signs $3,400

TOTAL START-UP
$248,500
EXPENSES

Start-up Assets $225,400

Cash Required $181,000

Start-up Inventory $35,100

Other Current Assets $252,500

Long-term Assets $211,300

TOTAL ASSETS $905,300

Total Requirements $1,153,800

START-UP FUNDING

Start-up Expenses to
$248,500
Fund

Start-up Assets to Fund $905,300

TOTAL FUNDING
$1,153,800
REQUIRED
Assets

Non-cash Assets from

$1,165,800
Start-up

Cash Requirements
$125,300
from Start-up

Additional Cash Raised $50,000

Cash Balance on
$31,300
Starting Date

TOTAL ASSETS $1,372,400

Liabilities and Capital

Liabilities $12,500

Current Borrowing $0

Long-term Liabilities $0

Accounts Payable
$61,100
(Outstanding Bills)

Other Current Liabilities

$0
(interest-free)

TOTAL LIABILITIES $73,600

Capital

Planned Investment $1,153,800

Investor 1 $0

Investor 2 $0
 Other $0

Additional Investment
$0
Requirement

TOTAL PLANNED
$1,153,800
INVESTMENT

Loss at Start-up (Start-

$145,000
up Expenses)

TOTAL CAPITAL $1,298,800

TOTAL CAPITAL AND

$1,372,400
LIABILITIES

Total Funding $1,153,800

Services of diaper manufacturer

Before starting a diaper service business you must decide which services you will be
providing to your customers. For this, you can analyze what services others in the pamper
business are providing to their customers. In this diaper business plan we are providing a
complete guide on how to start a diaper business. To assist you in deciding on services if
you are starting a diaper business, we are listing products provided by Happy Hygiene.

 Diapers for Babies

Our major product will be baby diapers. We will provide disposable, comfortable, and more
absorbent diapers to ensure 24/7 hygiene and health for babies and infants. We aim at
designing diapers more affordably and efficiently than our competitors.

 Sanitary Pads for Adults & Seniors

We will also manufacture sanitary pads for those adults and seniors who would not be able
to move and use washrooms due to illness, major operations, or any other reason.

 Baby-Friendly Cleaning Products

We will also provide a range of other products that help keep babies tidy and clean. They
will include tissues, wipes, baby perfumes, powders, washing lotions, shampoos, and
creams.
  Clothing Accessories

We will offer a wide of kids’ accessories that include inner wearables, jerseys, clothes, and
body suits.

Marketing Analysis of diaper manufacturer

5.1 Market Trends

The diaper business is high in demand in the United States. And the demand is forecasted
to increase even more due to increased awareness about hygiene. According to IBISWorld,
the market size of baby diaper manufacturing business reached $13.1 billion in 2022 in the
United States. The diaper manufacturing business saw an annual growth rate of 1.6% in
2022 and the rate is expected to keep rising.

5.2 Marketing Segmentation

Before starting a diaper service it is essential to recognize the segments of the population
who can be your potential customers. Happy Hygiene identified the following groups as its
potential customers in its diaper manufacturer business plan:

5.2.1 Parents
The biggest consumers of our products will be the parents whether they constitute single-
parent families or households with both parents. Keeping the child clean and tidy is a never-
ending task for parents. In both cases, whether they are working or stay-at-home moms or
dads, they would be needing assistance in the form of disposable diapers to keep their kids
clean and healthy.

5.2.2 Retail Store Owners

The second category of our target customers comprises the retail stores. They are expected
to buy from us in volumes as they will be reselling the products.

5.2.3 Daycare Centers

The third category includes daycare centers. They will be needing our products to ensure
the cleanliness criteria are met as they board kids for 8 to 10 hours a day.

5.2.4 Child Care & Adult Care Institutes

Lastly, state-sponsored welfare institutes for childcare and adult care will also be our
potential customers. Specifically, old homes that house ill and physically disabled will need
our products to take care of senior citizens.

Market
Analysis
 Potential
Growth Year 1 Year 2 Year 3 Year 4 Year 5 CAGR
Customers

Parents 31% 42,300 50,760 60,912 73,094 87,713 10.00%

Retail Store
29% 40,100 48,120 57,744 69,293 83,151 10.00%
Owners

Daycare
22% 26,330 31,596 37,915 45,498 54,598 10.00%
Centers

Child & Adult

18% 23,110 27,732 33,278 39,934 47,921 11.00%
Care

Total 100% 131,840 158,208 189,850 227,820 273,383 10%

5.3 Business Target

Including well-defined and specific business targets is a must if you are developing a
business plan no matter it is for diamond cutting and polishing business plan or business
plan for electrical contractor.

In this diaper delivery service business plan, we are listing the business targets set by
Happy Hygiene for its business.

 Earning and maintaining an average rating of 4.8 out of 5 on our website and mobile app

 Expand the business to at least 2 more locations by the end of the first five years

 Maintaining a Customer Satisfaction Score of more than 90% throughout our service years

5.4 Product Pricing

Our products are priced at a slightly lower price than that of our competitors. However, the
cut in prices hasn’t come with compromising the quality. Happy Hygiene was able to make
cost-effective diapers because of the invention of a more efficient baby diapers
manufacturing process by Hanks who is an experienced engineer and financial manager.

Marketing Strategy of diaper manufacturer

Whether a diaper service franchise thrives or ends up in loss depends on the marketing
strategy. Marketing strategy enables a business to reach its target audience and convince it
to purchase its products and services. In this diaper manufacturer business plan, we are
providing the sales strategy developed by Happy Hygiene.
6.1 Competitive Analysis
The competitive analysis as given in the diapers business plan of Happy Hygiene is as
follows:

 Our biggest competitive advantage is that our products come at a lower rate than those of our
competitors. They are more affordable while being more comfortable and efficient.

 Our web presence is really strong and we have specifically focused on developing posters
and content that is convincing.

6.2 Sales Strategy

 We’ll provide free childcare accessories such as shampoos and inner wearables with large
bundles of our diapers.

 We’ll issue 40% discount cards to our regular customers and retailers who collectively
purchase diapers from us for a whole year.

6.3 Sales Monthly

6.4 Sales Yearly

6.5 Sales Forecast

Sales Forecast

Unit Sales Year 1 Year 2 Year 3

Diapers for
16,000 16,960 17,978
Babies

Sanitary Pads
15,000 15,900 16,854
for Seniors

Baby-Friendly
Cleaning 14,000 14,840 15,730
Products

Clothing
11,500 12,190 12,921
Accessories

TOTAL UNIT
56,500 59,890 63,483
SALES

Unit Prices Year 1 Year 2 Year 3

Diapers for
$42.00 $48.72 $56.52
Babies

Sanitary Pads
$33.00 $38.28 $44.40
for Seniors

Baby-Friendly
Cleaning $40.00 $46.40 $53.82
Products

Clothing
$75.00 $87.00 $100.92
Accessories

Sales

Diapers for
$672,000.00 $826,291.20 $1,016,007.66
Babies

Sanitary Pads
$495,000.00 $608,652.00 $748,398.50
for Seniors
Baby-Friendly
Cleaning $560,000.00 $688,576.00 $846,673.05
Products

Clothing
$862,500.00 $1,060,530.00 $1,304,027.69
Accessories

TOTAL SALES $2,589,500.00 $3,184,049.20 $3,915,106.90

Direct Unit
Year 1 Year 2 Year 3
Costs

Diapers for
$15.00 $16.50 $17.33
Babies

Sanitary Pads
$8.00 $8.80 $9.24
for Seniors

Baby-Friendly
Cleaning $15.00 $16.50 $17.33
Products

Clothing
$75.00 $82.50 $86.63
Accessories

Direct Cost of
Sales

Diapers for
$240,000.00 $279,840.00 $311,461.92
Babies

Sanitary Pads
$120,000.00 $139,920.00 $155,730.96
for Seniors

Baby-Friendly
Cleaning $210,000.00 $244,860.00 $272,529.18
Products
 Clothing
$862,500.00 $1,005,675.00 $1,119,316.28
Accessories

Subtotal Direct
$1,432,500.00 $1,670,295.00 $1,859,038.34
Cost of Sales

Personnel plan of diaper manufacturer

Before starting a diaper service business it is a must to enlist the number of employees you
will be needing. For this, you can take help from the personnel plan from cosmetics
manufacturing business plan since its working has great resemblance with diapers
business.

7.1 Company Staff

Happy Hygiene will hire the following persons to run its baby diapers business.

 1 Co-Manager

 1 Textile Engineer

 1 Chemical Engineer

 6 Technical Assistants

 2 Cleaners

 1 Store Manager

 1 Web Operator

 1 Receptionist

7.2 Average Salary of Employees

Personnel
Plan

Year 1 Year 2 Year 3

Co-Manager $32,500 $35,750 $39,325

 Textile
$32,500 $35,750 $39,325
Engineer

Chemical
$32,500 $35,750 $39,325
Engineer

Technical
$160,500 $176,550 $194,205
Assistants

Cleaners $44,450 $48,895 $53,785

Store Manager $22,450 $24,695 $27,165

Web Operator $22,450 $24,695 $27,165

Receptionist $22,450 $24,695 $27,165

Total Salaries $369,800 $406,780 $447,458

Financial Plan of diaper manufacturer

After you have known how are diapers manufactured, it is important to analyze diaper
manufacturing cost. It will help you estimate profit and loss for your business as well as
devise a strategy to drive your startup into a success.

The financial plan developed for Happy Hygiene is provided here:

8.1 Important Assumptions

General
Assumptions

Year 1 Year 2 Year 3

Plan Month 1 2 3

Current
8.12% 8.20% 8.26%
Interest Rate

Long-term 8.40% 8.44% 8.47%

 Interest Rate

Tax Rate 24.03% 24.21% 24.60%

Other 0 0 0

8.2 Break-even Analysis

Break-Even Analysis

Monthly Units Break-

5340
even

Monthly Revenue
$132,500
Break-even

Assumptions:

Average Per-Unit
$231.00
Revenue

Average Per-Unit
$0.62
Variable Cost

Estimated Monthly
$163,800
Fixed Cost
8.3 Projected Profit and Loss

Pro Forma Profit And Loss

Year 1 Year 2 Year 3

Sales $2,589,500 $3,184,049 $3,915,107

Direct Cost of
$1,432,500 $1,670,295 $1,859,038
Sales

Other $0 $0 $0

TOTAL COST OF
$1,432,500 $1,670,295 $1,859,038
SALES

Gross Margin $1,157,000 $1,513,754 $2,056,069

Gross Margin % 44.68% 47.54% 52.52%

Expenses

Payroll $369,800 $406,780 $447,458

Sales and
Marketing and $145,000 $148,000 $156,000
Other Expenses

Depreciation $2,300 $2,350 $2,500

Leased
$0 $0 $0
Equipment

Utilities $2,900 $3,000 $3,100

Insurance $2,100 $2,100 $2,100

Rent $2,900 $3,000 $3,200

 Payroll Taxes $24,000 $25,000 $27,000

Other $0 $0 $0

Total Operating
$549,000 $590,230 $641,358
Expenses

Profit Before
Interest and $608,000 $923,524 $1,414,711
Taxes

EBITDA $608,000 $923,524 $1,414,711

Interest Expense $0 $0 $0

Taxes Incurred $121,600 $184,705 $282,942

Net Profit $486,400 $738,819 $1,131,768

Net Profit/Sales 18.78% 23.20% 28.91%

8.3.1 Profit Monthly

8.3.2 Profit Yearly

8.3.3 Gross Margin Monthly

8.3.4 Gross Margin Yearly

8.4 Projected Cash Flow

Pro Forma
Cash Flow

Cash Received Year 1 Year 2 Year 3

Cash from
Operations

Cash Sales $51,000 $55,080 $59,486

Cash from
$22,000 $23,760 $25,661
Receivables

SUBTOTAL CASH
FROM $73,000 $79,570 $85,936
OPERATIONS

Additional Cash
Received

Sales Tax, VAT,

HST/GST $0 $0 $0
Received

New Current $0 $0 $0
Borrowing

New Other
Liabilities $0 $0 $0
(interest-free)

New Long-term
$0 $0 $0
Liabilities

Sales of Other
$0 $0 $0
Current Assets

Sales of Long-
$0 $0 $0
term Assets

New
Investment $0 $0 $0
Received

SUBTOTAL CASH
$74,000 $79,000 $85,000
RECEIVED

Expenditures Year 1 Year 2 Year 3

Expenditures from
Operations

Cash Spending $42,000 $42,000 $45,000

Bill Payments $27,000 $28,000 $31,000

SUBTOTAL
SPENT ON $69,000 $70,000 $76,000
OPERATIONS

Additional Cash
Spent

Sales Tax, VAT, $0 $0 $0

 HST/GST Paid
Out

Principal
Repayment of
$0 $0 $0
Current
Borrowing

Other Liabilities
Principal $0 $0 $0
Repayment

Long-term
Liabilities
$0 $0 $0
Principal
Repayment

Purchase Other
$0 $0 $0
Current Assets

Purchase Long-
$0 $0 $0
term Assets

Dividends $0 $0 $0

SUBTOTAL CASH
$69,000 $74,520 $80,482
SPENT

Net Cash Flow $21,000 $23,000 $25,000

Cash Balance $27,000 $30,000 $33,000

8.5 Projected Balance Sheet

Pro Forma Balance Sheet

Assets Year 1 Year 2 Year 3

Current Assets
Cash $275,000 $308,000 $338,800

Accounts
$24,000 $26,880 $30,213
Receivable

Inventory $4,300 $4,816 $4,900

Other Current
$1,000 $1,000 $1,000
Assets

TOTAL CURRENT
$282,000 $315,840 $355,004
ASSETS

Long-term
Assets

Long-term
$10,000 $10,000 $10,000
Assets

Accumulated
$19,400 $21,728 $24,444
Depreciation

TOTAL LONG-
$24,400 $27,328 $30,744
TERM ASSETS

TOTAL ASSETS $294,000 $329,280 $370,440

Liabilities and
Year 4 Year 5 Year 6
Capital

Current
Liabilities

Accounts
$18,700 $20,944 $23,541
Payable

Current
$0 $0 $0
Borrowing
 Other Current
$0 $0 $0
Liabilities

SUBTOTAL
CURRENT $19,000 $21,280 $23,919
LIABILITIES

Long-term
$0 $0 $0
Liabilities

TOTAL
$15,000 $16,800 $18,883
LIABILITIES

Paid-in Capital $30,000 $30,000 $31,000

Retained
$53,000 $57,770 $63,547
Earnings

Earnings $193,400 $210,806 $231,887

TOTAL CAPITAL $285,000 $310,650 $341,715

TOTAL
LIABILITIES AND $300,000 $329,280 $370,440
CAPITAL

Net Worth $293,400 $319,806 $351,787

8.6 Business Ratios

Ratio Analysis

INDUSTRY
Year 1 Year 2 Year 3
PROFILE

Sales Growth 7.25% 8.03% 8.90% 3.00%

Percent of Total
Assets

Accounts
9.21% 10.20% 11.31% 9.80%
Receivable

Inventory 5.39% 5.97% 6.62% 9.90%

Other Current
2.11% 2.34% 2.59% 2.40%
Assets

Total Current
149.80% 151.00% 152.00% 158.00%
Assets

Long-term Assets 11.55% 11.60% 11.64% 12.00%

TOTAL ASSETS 100.00% 100.00% 100.00% 100.00%

Current Liabilities 4.90% 4.94% 4.98% 4.34%

Long-term
0.00% 0.00% 0.00% 0.00%
Liabilities

Total Liabilities 7.59% 7.65% 7.72% 7.38%

NET WORTH 100.45% 101.25% 102.19% 110.00%

Percent of Sales

Sales 100.00% 100.00% 100.00% 100.00%

Gross Margin 94.60% 97.15% 99.87% 99.00%

Selling, General &

Administrative 93.56% 96.09% 98.78% 97.80%
Expenses
Advertising
1.52% 1.56% 1.60% 1.40%
Expenses

Profit Before
41.50% 42.62% 43.81% 33.90%
Interest and Taxes

Main Ratios

Current 34 35 36 32

Quick 33 33.8 34.645 33

Total Debt to Total

0.18% 0.18% 0.17% 0.40%
Assets

Pre-tax Return on
74.08% 74.89% 75.00% 75.00%
Net Worth

Pre-tax Return on
96.30% 101.12% 106.17% 111.30%
Assets

Additional Ratios Year 1 Year 2 Year 3

Net Profit Margin 33.56% 34.60% 35.67% N.A.

Return on Equity 55.80% 57.53% 59.31% N.A.

Activity Ratios

Accounts
Receivable 7.7 7.8 7.8 N.A.
Turnover

Collection Days 100 100 100 N.A.

Inventory
32.4 34.02 35 N.A.
Turnover

Accounts Payable 15.6 16 16.3 N.A.

Turnover

Payment Days 27 27 27 N.A.

Total Asset
2.5 2.5 2.6 N.A.
Turnover

Debt Ratios

Debt to Net Worth -0.04 -0.03 -0.04 N.A.

Current Liab. to
1 1 1 N.A.
Liab.

Liquidity Ratios

Net Working
$244,000 $257,664 $272,093 N.A.
Capital

Interest Coverage 0 0 0 N.A.

Additional Ratios

Assets to Sales 0.85 0.87 0.89 N.A.

Current Debt/Total
1% 0% 0% N.A.
Assets

Acid Test 29 29.12 29.16 N.A.

Sales/Net Worth 2.1 2.2 2.2 N.A.

Dividend Payout 0 0 0 N.A.

FAQ

 How do I start a diaper business?

Make a detailed diaper manufacturing business plan. Procure resources and you’re good to
go! However, it is recommended to hire an expert business plan developer to make
pampers business plan if you lack the experience.

 Are diapers profitable?

Yes, provided that you plan for your business accurately and execute your diaper
manufacturer business plan in letter and spirit.

 Where are diapers manufactured?

As discussed in this diaper business plan, diapers are manufactured in factories or small
workshops.

 How baby diapers are manufactured?

It is a systemic process that requires automation to some extent. Required resources are
acquired and layers of sheets: permeable, semi-permeable, and thin plastic are established.

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