Plastic2Oil Inc (PTOI)

[the big guy]

Steady_T:

I like your post. It is informative and filled with detail.

However, I think you are underestimating the costs and that the $10/barrel cost model is seriously flawed.

The quickest way I can demonstrate that is to look at labor cost once again.

You say you have 2 people being paid $30/hour to operate the P2O machine. Not a bad number. However, you specifically say "paid". Once again, you are ignoring the fact that what these people actually cost the company is quite different from what they are paid. In fact, you can double the number they are paid to get to what they actually cost the company. Their Cost is $60/ hour.

The other thing is that this makes up most of the Cost figure you are starting with. So instead of $1440/ day for Direct Labor you have $2880/ day. And immediately your argument is debunked.

In fact, I can drive a truck through your post.

The biggest problem here is that you are starting with a figure in mind and the rest of what you are saying follows from that. If you looked at things from first principles and thought in an open-minded fashion, you would come up with a more realistic number. Simply forget about the $10/hour and look at the costs in am open minded way.

In my previous posts I have stated that in order to get 20-30% ROI over the first several years of operation he needs to make $800k/ year. that is a start point and takes care of the capital invested in Plant & Equipment. After that is Direct Labor and Overheads (what you are looking at).

It is a good start, unfortunately I can blow it out of the water.