Now, this was a really interesting business that I enjoyed understanding and learning more about. This brick manufacturing business is run by Mr. J.P. Srinivas. It is called “Sri Srinivasa Traders”. The manufacturing land is adjacent to their residence, making it very convenient for him and his family to keep a watch on the manufacturing of bricks.
An interesting fact to note is that of the 8 labourers that are hired, none are citizens of Karnataka. Instead, they come from various places such as Assam, Orissa etc.
Now actually breaking down the economics of the business, some of the details which we could extract are:
The ideal weight of a single brick should be 3 kg. And, an ideal quantity of mud to make the ideal brick is 4kg. Also, one load of mud which costs Rs. 250 can be used to make around 750 bricks. Therefore, the cost of purchasing mud for making a single brick is 250/750 ~ 35 paise.
Hence the cost for purchases of mud for making is brick is 35 paise.
As per the rates stated by Mr. Srinivas, the other costs spent on manufacturing a brick can be simplified into the following divisions:
- To mould the 4kgs of mud into a single 3kgs brick, the cost is 80 paise per brick.
- To bring a brick from the point of moulding to the kiln is 30 paise per brick.
- The total cost of fuel, firewood and labour for firing the kiln is Rs. 1.5 per brick.
The total cost spent on a single brick after completing the above three procedures is Rs. 2.6.
Therefore combining the values obtained at both stage a. and b. we can infer that a total of Rs. 2.95 is spent in manufacturing a single brick from scratch.
And, we also learnt that he sells around 10 lakh bricks an year at a profitable rate of Rs. 6 per brick. Therefore the approximate profit that he earns on a single brick is Rs. 3.
Hence his total sales through bricks in a year are around Rs. 60 lakh and his profits lie in the range of 25 to 30 lakh give or take.
Added to this gargantuan profit, he also separately runs a cement shop at some other location. He earns an income through this too. Also, his wife works at a canteen where she prepares food for school children and others. She too earns a salary.
I also learnt some interesting things on how bricks are actually manufactured. Essentially, once the mud is obtained, it is moulded into bricks. Then it is left in an open but cool and shady location for at least a month or so. This is then followed by the burning of these bricks in a kiln for a span of 12 hours. Then in the kiln itself, the bricks are allowed to cool for another 24 hours. After this is completed, the brick is completely manufactured and is ready to be sold.
Therefore from the above mentioned facts it is quite clear that the brick manufacturer is quite well to do and is leading a very comfortable life.