Abstract:
Although Sudan is among the top producers of livestock and has several export oriented slaughterhouses yet, the country failed to become a major player in the international meat market. This is attributed to the fact that all of these slaughterhouses do not satisfy the quality standards required, particularly in the Middle East where the demand has been changing towards assurance of food quality and safety measures and regulations. Elsahafa Modern Slaughterhouse (EMSH) is not an exception. It is unqualified to meet the requirements of the ISO certification, yet it can comply with the Gulf standard organization (GSO) if the current situation is improved.
The aim of this study was to assess the profitability of the implementation of quality management system in Elsahafa modern slaughterhouse to comply with the Gulf standard organization (GSO). The cost/benefit analysis was used to examine the profitability of the improvement. The life span of the (EMSH) was set to 25 years and a rate of (15%) cost of capital was used to discount the cash flow. Sensitivity analysis was carried out to assess the effect of the change in the prizes by 10% and 50%.
The study revealed that the improvement is feasible since the evaluation criteria (both discounted and undiscounted) are show positive results. The payback period is 1.01 year, and the simple rate of return is found to be (100 %), undiscounted benefit cost ratio is (25) with a net cash flow ($ 453.5 million). On the other hand the discounted criteria are as follows: the net present value is ($ 89.8 million), and internal rate of return (100 %) and discount benefit cost ratio is (25).The sensitivity analysis shows no risk, since changing the prizes by 50% has no negative effect on the profitability.
The study concluded that improvement of the quality standard to Sudan slaughterhouses has a positive impact on the profitability of the investor as well as the economy as a whole and recommended that all meat producing sector should comply with the international requirements of quality management and obtain the ISO certification for the benefit of all.
