Abstract:
Tea is the main export plantation crop and the main foreign exchange earner among agricultural products of Sri
Lanka. In 1998 Food and Agricultural Organization (FAO) named tea as a food commodity. Consumers in the global
market are very conscious on the quality of tea as a healthy beverage. Thus, "Food Safety Standards” have adopted for
tea to prove its suitability for human consumption. Among food safety management systems, ISO 22000 is the most
widely used and most accepted system and the 5S is a supporting system, which helps to establish ISO 22000. To
establish this system it spends large amount of cost. Therefore, it is worthwhile to find out that the economic benefits
of establishing these quality management systems. Matara district was selected purposively and five factories within
the district were selected randomly. They are Dhampahala, Mulatiyana, Nilgiri, Sudugaha hena and Bogoda. To find
out the "economic impact" of the project, the project analysis tools such as Net Present Value (NPV), Internal Rate of
Return (IRR), Benefit cost ratio (BC ratio] and Payback period were employed. Results revealed that establishment of
Quality Management Systems (QMS) in to a tea factory are beneficial economically. The NPV was 2,482,774.00 LKR.
The IRR was 74% and the BC ratio was 1.69. The payback period was 3 years. Therefore, the introduction of QMS is a
worthwhile investment for tea factories in economic aspect.
