To convert our synthetic biology design into usable products and to introduce the product to practical usage scenarios, we designed the implementation and commercialization strategy of Pestacheck.

China is one of the world’s largest consumers of pesticides. Research indicates that China is in the fifth place among the most pesticides consuming countries, with a total application volume of about 229 thousand tons in 2023. The combined pressures of severe pest infestations and high-intensity, large-scale farming practices have further increased pesticide use and made residue risk management more challenging.

At the food supply chain’s endpoint, data from the State Administration for Market Regulation (SAMR) show that in 2024 the national food inspection pass rate was 97.04%, with a non-compliance rate of 2.96%. Among the causes of non-compliance, pesticide and veterinary drug residues accounted for 39.56%, ranking first. This suggests that despite the overall high compliance rate, excessive residues remain one of the primary risk sources, characterized by high dispersion and strong randomness, thereby imposing continuous pressure on routine regulatory inspections and enterprise-level self-monitoring.

From the perspective of enterprises and regulatory agencies, pesticide residue testing is costly. In the Greater China region, the price of multi-residue LC-MS/MS (or combined schemes) testing per sample typically ranges from 1,000 to 1,800 RMB (equivalent to 4,000–8,000 TWD in 2024), depending on package design, number of analytes, and reporting time. At the county and district levels, agricultural and market supervision authorities are often equipped with rapid detection instruments and consumables such as reagents or test strips.

Beyond direct testing fees, there are also substantial indirect costs. The cycle from sample submission to report issuance generally requires 2–7 days (expedited services incur additional fees). For perishable fresh produce (e.g., wet markets or campus canteens), this lag often results in operational losses due to delayed sales or product returns. Moreover, non-compliant cases trigger mandatory re-testing, trace-back investigations, administrative interviews, and corrective actions, all of which generate additional expenditures for both regulators and enterprises.

For estimation, we focus exclusively on direct costs. In the first quarter of 2025, the Ministry of Agriculture and Rural Affairs conducted random inspections on 7,526 agricultural product samples. Using the median laboratory confirmation cost of 1,200 RMB per sample (within a range of 1,000–1,800 RMB), the overall direct economic burden can be preliminarily assessed.
The quarterly cost of agricultural product sampling inspections by the Chinese government can be calculated as follows:
On an annual basis, this amounts to:


From a public health perspective, surveillance data on acute poisoning also underscore the persistent risks associated with pesticide exposure. According to analyses of the National Health Emergency Information System (2016–2022), a total of 95,754 cases of acute poisoning were reported. Among these, pesticide poisoning accounted for 30.4%, ranking as the leading cause of poisoning and exhibiting the highest case-fatality rate (2.78%). Although this proportion does not directly specify pesticide residues via the “food ingestion pathway,” it nonetheless reflects the substantial monitoring and surveillance needs arising from widespread pesticide exposure.

Assuming that the frequency of acute poisoning cases was evenly distributed across 2016–2022, and that the proportion attributable to pesticide poisoning remained constant, the annual number of pesticides poisoning cases can be estimated as:

For estimation, we restrict our analysis to direct treatment costs, excluding opportunity costs.
Mild to moderate cases: Typically managed through gastric lavage and routine interventions. The average cost is estimated at 300 RMB per case (regional range: 200–500 RMB).
Severe cases: Typically require admission to an Intensive Care Unit (ICU) for five days, with additional interventions such as mechanical ventilation and hemoperfusion.
ICU/ventilation: 5,000 RMB/day × 5 days = 25,000 RMB (within the range of 3,000–8,000 RMB/day).
Hemoperfusion: 1,000 RMB/session × 2 = 2,000 RMB.
Gastric lavage/basic interventions: 300 RMB.
Thus, the estimated direct treatment cost for a severe pesticide poisoning case is approximately:


Publicly available national datasets rarely provide direct evidence on the proportion of pesticide poisoning cases requiring mechanical ventilation. For this analysis, we therefore adopt a median scenario, if 20% of cases are severe. Under this assumption, the annual direct treatment cost of pesticide poisoning in China can be estimated as follows:
Mild/Moderate cases:
Severe cases:
Then, annual Total ≈ 55.30 million RMB
Thus, the estimated economic burden attributable to pesticide poisoning in China, when combining public health treatment costs (55.30 million RMB) with national inspection and monitoring expenditures (36.12 million RMB annually), amounts to approximately

It should be noted that this calculation only accounts for direct medical and regulatory costs. Opportunity costs arising from lost productivity, business disruptions, or individual expenditures related to pesticide residue monitoring and food safety compliance are not included in this estimate. Consequently, the actual economic burden of pesticide-related risks is likely to be substantially higher, and the present figure should be interpreted as a conservative lower bound.

Due to the high cost and long time required of large-scale pesticide residue detection, rapid pesticide residue detection methods are demanded by individual farmers and quality-life pursuers. The invention of pesticide residue detection test strips is not our innovative point; rather, we aim to optimize the ones because of the increasing requirements for more stable, sensitive and durable test strips, as illustrated in our social survey in the Integrated Human Practices page.

Compared to other detection technologies adopted by existing test strips on the market, we chose Enzyme-inhibition assay because of its operation convenience and low investment cost. The enzyme stabilized on the test strip is Acetylcholinesterase (AChE). As pesticide residue will block the activity of the enzyme, it will not be able to decompose the substrate displayed on the strip paper.

Enzyme stability has been a major focus for the improvement of the test strip. Through computer assistance optimization of the AChE structure and cell-free expression of the protein, we came up and refined our solution Pestacheck. We firmly believe that our product's superiority in terms of test paper stability can outcompete the existing products and offer individuals a more affordable, efficient and convenient method for pesticide testing.

3.1 Product Classification

File with the provincial Market Supervision Administration, explicitly categorizing the product as a “food safety rapid testing consumable”.
Applicant: Manufacturing enterprise or authorized import agent.
Submission materials:

• Product manual (composition, principle, scope of use, storage conditions);
• Technical specifications (sensitivity, detection limit, stability, and other experimental data);
• Third-party laboratory testing report (from a CNAS-accredited institution);
• Business license and production permit of the enterprise.

The Provincial Market Supervision Administration reviews the submitted materials and organizes expert evaluation. Then a filing number is issued, which is required before the product can be distributed through e-commerce platforms and agricultural markets.

3.2 Filing and Licensing

Complete product filing for food testing consumables. The manufacturing facility obtains the appropriate Production License.
Competent authority: Local Administration for Market Regulation (formerly the Bureau of Quality and Technical Supervision).
Application requirements: The enterprise must have legally compliant premises and facilities and meet safety production and environmental protection standards.
Submission materials:

• Factory layout plan and production process flowchart;
• List of main equipment and inspection/testing equipment;
• Quality management system documents (including raw material inspection on entry and finished product inspection procedures);
• Certificates of compliance with safety production and environmental protection regulations.

On-site inspection: Officials from the Administration for Market Regulation conduct an on-site factory inspection. If requirements are met, an Industrial Product Production License is granted.

3.3 Testing Reports

Commission a CNAS-accredited laboratory to issue authoritative reports on sensitivity, specificity, and stability.

3.4 Compliance Labeling

Packaging and instructions must comply with the Food Safety Law, Product Quality Law, and Advertising Law of China, and must not include misleading medical claims.

Since product are launched in China firstly, we must abide by the following specific Chinese regulations:

• Food Safety Law:
  • Article 37: Prohibits false advertising of food safety functions.
  • Article 99: Testing data must be authentic and must not be fabricated or tampered with.
• Product Quality Law:
  • Article 13: Products must comply with national or industry standards that ensure human health and personal/property safety.
  • Article 27: Products or their packaging must be labeled in Chinese with the product name, manufacturer’s name and address, specifications, and main components or contents.
• Advertising Law:
  • Article 16: Advertisements must not falsely claim to substitute medical examinations or treatments.
  • Article 28: Advertisements must not contain false or misleading content.

3.5 E-commerce and Market Entry

Ensure compliance with entry standards of major platforms such as Tmall and JD.com, as well as agricultural markets, by providing filing numbers, third-party testing reports, and valid production licenses.

E-commerce platforms (e.g., Tmall, JD.com) requirements:

• Provide the filing number (issued by the provincial Market Supervision Administration);
• Submit product testing reports (from China National Accreditation Service for Conformity Assessment(CNAS) accredited laboratories);
• Upload scanned copies of the production license;
• Provide valid certificates of conformity and quality inspection reports;
• Ensure labels and instructions are compliant (no implication of medical use).

Farmers’ markets / offline channels requirements:

• Product filing number;
• Product testing reports;
• Archived copy of the production license.

4.1 Product Positioning and Core Value

Competitive Analysis:
Although there are numerous pesticide residue detection tools available in the market, Pestacheck can provide faster and more stable testing with higher enzyme stability and activity.

By testing other rapid detection tools selling the current market, we discovered that they have following problems:

• Lengthy processing time and high labor involvement: The procedure requires prolonged manual operation (e.g., hand-mixing), resulting in low efficiency and limited scalability.
• Poor stability and low sensitivity: The results are highly susceptible to environmental factors such as hand temperature and ambient conditions, and the strips show weak responsiveness to variations in analyte concentration.
• Rapid color fading: The color signal tends to fade quickly over time, in some cases within as little as ten minutes, which significantly reduces the reliability and reproducibility of the test results.

However, the product of Pestacheck has finer performance in these aspects, plus having higher enzymatic activity than products available on the market (you can find related experimental proof in the Wet Lab).
Therefore, product of Pestacheck addresses the gap in the market for rapid detection tools that is trustable and convenient.
Strategy:
Position Pestacheck as a civilian-oriented instrument for rapid food safety testing.
Core Value Proposition (UVP): “Stable, rapid, and universally accessible.”

4.2 Regulatory and Compliance Pathways

Analysis:
The Chinese market is subject to stringent regulation, with government authorities encouraging the integration of “rapid testing combined with random sampling inspection.”
In foreign markets, certification standards for food safety instruments are considerably stringent, requiring long-term datasets and laboratory-based validation as essential supporting evidence.
Strategy:

• Short-term (China): Complete the requisite filings with domestic regulatory authorities to ensure product eligibility for distribution through e-commerce platforms and agricultural markets.
• Mid-term (China): Collaborate with accredited third-party laboratories to obtain authoritative data on sensitivity and accuracy; seek inclusion in procurement catalogs for schools, food service institutions, and regulatory institutions.
• Long-term (International): Leverage the market presence and accumulated empirical data from China to meet the elevated certification requirements of international markets.

4.3 Technology and Production System

Analysis:
The cost of establishing proprietary manufacturing facilities is prohibitively high; therefore, outsourcing production in the early stages is essential.
Original Equipment Manufacturer (OEM): Factories manufacture the product on our behalf based on our proprietary formulations, enabling rapid market entry.
Original Design Manufacturer (ODM): Building upon the production foundation, factories provide support in process optimization and new test strip design, thereby facilitating product iteration.
Strategy:

• Early stage: Select OEM partners with proven experience in diagnostic strips and medical consumables to achieve rapid scale-up.
• Intermediate stage: Introduce ODM partners to collaborate on the development of multi-residue pesticide detection strips, thereby enhancing technological robustness.
• Long-term: Safeguard independence in core reagents and algorithms, while outsourcing physical production; establish a diversified network of partner factories to mitigate supply chain risks.

4.4 Market and Customer Segmentation

Early Stage (China Market Entry Phase)
In the early stage, our focus are mainly Consumer segment (C-end) and non-industrial food institutions (B-end). This is because the C-end possesses educational and public awareness value, enabling rapid amplification of brand recognition. The B-end (schools, restaurants, supermarkets, etc.) can generate stable and recurring cash flows, while the G-end (governmental organizations) involves more complex procurement processes, making rapid entry less feasible.
Intermediate Stage (Market Expansion Phase)
In the intermediate Stage, we would concentrate on institutional clients (B-end: both industrial and non-industrial food organizations) and governmental/food safety organizations (G-end), since he B-end provides bulk orders that can support economies of scale, and the G-end, once secured, can provide strong social credibility and policy-driven expansion into broader applications. The C-end continues to serve educational and awareness functions, maintaining consumer stickiness without being the primary growth driver.
Our stakeholders are mainly our customers. To sell our products to different stakeholders, we utilize different specific market strategy based on their characteristics. (You can get the characteristic summarization in Stakeholder Analysis in Human Practices.)

• High Leverage & High Priority
  Plan:
  In terms of market strategy, we emphasize building long-term trust with them: compliance and standards at the regulatory level, data and knowledge production as the link at the academic level, and word-of-mouth and social diffusion as the entry point at the consumer level. The overall goal is to translate their influence into industry leadership.
  
• High Leverage & Medium Priority
  Plan:
  We adopt a "market-oriented embedding" strategy. That is, we link test results to economic interests——using PestAChEck, showing healthy results, implying a better crop, and more people buying the crop——so that they can be adopted passively or actively in market logic, rather than relying on additional administrative pushes.
  
• Medium Leverage & High Priority
  Plan:
  They are not only users, but also representatives of the commitment to safety in the eyes of the public. Our strategy for them is to provide transparency and verifiable records visible to the public, strengthening social trust in our products.
  
• Medium / Low Leverage & Medium Priority
  Plan:
  Our marketing strategy is to treat them as tools for brand and competition, and to make them the shapers of market education and consumer habits through green labeling, supply chain digitization and market communication. We look at them not as a single enterprise, but as an amplifier of the competitive landscape of the industry.
  
• Low Leverage & Low Priority
  Plan:
  The Low Leverage & Low Priority stakeholders are mainly low-awareness general consumers. They have currently limited leverage and not urgent for direct engagement. They can be reached later once broader awareness is established.

4.5 Commercialization and Promotion

Channel Development:

• Short-term: Utilize Chinese e-commerce platforms, agricultural market partnerships, and supermarket-based experiential marketing.
• Mid-term: Establish supply agreements with schools and restaurant chains; build regional distributor networks.
• Long-term: Expand into international distribution channels, entering more developing countries and developed countries pharmacies, supermarkets, and food enterprise supply chains.

Education and Public Outreach:

• Short-term: Launch consumer-facing campaigns emphasizing the concept of “test immediately after purchase.”
• Mid-term: Collaborate with NGOs and schools to implement “food safety education initiatives.”
• Long-term: Enhance brand legitimacy and recognition by engaging in international conferences and academic collaborations, shaping Pestacheck as a global leader in rapid food safety testing.

4.6 Business Model and Investment

Revenue Streams:

• Consumer segment (C-end): Unit sales and subscription packages (periodic test strip delivery).
• Institutional segment (B-end): Bulk procurement and long-term contractual agreements.
• Governmental segment (G-end): Government procurement and collaborations in public projects.

Investment Highlights:

• Addressing food safety as a critical societal need within a large and expanding market.
• Establishing proof of concept in China through accumulated data and market experience, enabling subsequent entry into high-standard international markets.
• Leveraging a light-asset model (OEM/ODM) to ensure rapid scalability and efficient capital utilization.

4.7 Long-Term Development and Strategic Upgrading

Product Diversification: Extend the product portfolio from pesticide residue detection to encompass upgraded detection formats (from simple visual readouts to smartphone-based recognition and multi-well rapid test cards), thereby forming a comprehensive pesticide residue testing matrix.
Digitalization: Develop mobile applications or mini-programs capable of scanning test strips, generating detection reports, and aggregating data into a comprehensive food safety database.
Internationalization:

• Short-term: Consolidate market presence within China and establish demonstrative case studies.
• Mid-term: Enter Japanese and European Union markets, employing compliance with higher regulatory standards as a brand endorsement mechanism, thereby cultivating global credibility.

Social Responsibility: Engage in rural and agricultural food safety initiatives as public welfare projects, thereby enhancing the brand’s social value and overall reputation.

5.1 Public-interest Objectives and Target Groups

Objective:
Through the integration of food safety education and the free distribution of pesticide residue test strips, this program seeks to enhance the risk-prevention capacity of farmers and consumers in remote areas.
Target Groups:

• Farmers/Cooperatives: To conduct self-testing of agricultural products, thereby reducing the circulation of products exceeding maximum residue limits in the market.
• Rural Primary and Secondary Schools: To be incorporated into science classes as practical experiments, fostering food safety awareness among the next generation.
• Township Agricultural Markets/Market Stalls: To serve as a rapid on-site screening tool prior to product entry into circulation.
• Rural Households: To be distributed via community centers and maternal and child health stations, providing portable test strips to encourage household-level screening of high-risk foods (e.g., leafy vegetables, melons).

Definition of “Remote Areas” in this Project:

• Geographical Conditions: Located ≥ 50 km from the nearest county-level city, with poor transportation access and limited public transit coverage.
• Economic Conditions: Average household income is ≥ 20% lower than the national rural average.
• Food Safety Risks: Food supply dominated by self-sufficient farming or small-scale agricultural markets, with insufficient access to standardized residue testing equipment and services.
• Medical and Regulatory Resources: Absence of permanent market supervision stations and routine disease control testing facilities.

Residents in these areas typically rely on self-production and direct sales, possess limited food safety awareness, and lack the financial capacity to afford regular testing. Therefore, they represent the key focus group for public-interest distribution.

5.2 Estimation Logic for Distribution Quantities

For estimation purposes, one township is taken as the unit of analysis, defined as having approximately 20,000 residents, 4,000 households, 200 market stalls, and 5 schools.

• Farmers/Cooperatives: Assuming 1,000 households as priority farming units, each provided with 2 strips per month (sufficient to cover high-risk crop sampling), the annual requirement is 24,000 strips.
• Market Stalls: 200 stalls, each provided with 1 strip per week, yielding an annual requirement of 200 × 52 = 10,400 strips.
• School Education: 5 schools, each allocated 50 strips per semester for classroom demonstrations/experiments, resulting in an annual requirement of 500 strips.
• Rural Households: 4,000 households, each allocated 2 strips per quarter (for high-risk food sampling), resulting in an annual requirement of 32,000 strips.

Total Annual Demand per Township (Public-interest Distribution):
At an estimated unit cost of USD 0.3 per strip, the annual financial input per township is approximately USD 20,070. If scaled to cover 50 townships (i.e., the size of a remote county jurisdiction), the annual demand would amount to 3.345 million test strips, requiring roughly USD 1 million in funding.

5.3 Food Safety Education and Public Outreach

Public-interest distribution must be accompanied by education, otherwise there is a high risk of wastage or misuse.

• Farmer Training
  • Format: Conducted through township agricultural extension stations, supplemented by agricultural technicians visiting villages.
  • Content: Correct pesticide application, the concept of pre-harvest intervals, and methods for rapid self-testing with residue strips.
  • Tools: Illustrated manuals, dialect audio recordings, and on-site demonstrations.
• School-based Curriculum
  • Format: Integration into science or labor courses as “food safety experiments.”
  • Content: Students use test strips to examine vegetables from the school garden, record observations, and analyze pesticide residue risks.
  • Purpose: Establish intergenerational knowledge transfer and enhance household-level food safety awareness.
• Market Co-regulation
  • Implementation: Establish “public interest testing corners” at market entrances.
  • Role of Market Administrators: Assist stallholders in performing tests and publish results, thereby increasing consumer trust.
• Community and Household Engagement
  • Distribution Channels: Community doctors and maternal/child health centers distribute test kits during routine services or outreach campaigns.
  • Educational Component: Households are taught a “four-step protocol for high-risk food testing”: sampling → adding reagent → waiting → interpreting with our designed smart-phone application

5.4 Implementation Process (Detailed Steps)

• Site Assessment (1 month)
  • Coordinate with local agricultural and market supervision authorities to identify target townships.
  • Conduct baseline surveys on farmer populations, market scale, and school distribution.
  • Evaluate cold-chain and logistics conditions to establish a distribution network.
• Resource Preparation (1 month)
  • Manufacture test strips in bulk.
  • Package into tailored kits:
    Farmer Kit: 24 strips per year
    Stallholder Kit: 52 strips per year
    Household Kit: 8 strips per year
    School Kit: 50 strips per semester
  • Package and deliver to county-level warehouses.
• Education and Launch (1 month)
  • Organize a “Food Safety Month” campaign, incorporating farmer training sessions, market outreach events, and school-based activities.
  • Distribute the initial test kits and conduct live demonstrations on their proper use.
• Regular Operation (year-round)
  • Quarterly redistribution of supplementary kits by county authorities.
  • Market administrators submit weekly test usage reports.
  • School teachers conduct class experiments and submit usage feedback.
  • Rural households upload results via a digital application or report by phone.
• Evaluation and Adjustment (annual)
  • Indicators: Usage rate ≥ 70%; positive detection rate ≥ 1%; reduction in pesticide exceedance rates ≥ 15%.
  • Follow-up: Adjust the number of test strips distributed and refine educational content for the subsequent year.

5.5 Funding and Sustainability

Funding Sources: Government food safety special funds, philanthropic foundations (e.g., the Bill & Melinda Gates Foundation), and corporate social responsibility (CSR) contributions from sectors such as agricultural inputs, food production, and e-commerce platforms.
Sustainability Mechanisms:

• Farmers and market stallholders may purchase additional test strips at cost price if required.
• Stallholders with consistently high compliance rates are granted priority access to procurement lists and awarded with “green labels.”
• Food safety education is incorporated into township-level programs such as “Healthy Villages” or “Nutrition Improvement,” ensuring long-term budgetary support.

6.1 Production Cost

a. Product
The Pestacheck’s strips consist of the enzyme and the base material.
i. Enzyme
The Cell-Free Expression System we adopted often used a reaction volume of 50 μL, and the total protein yield per reaction is 0.05 mg = 50 μg.
Each test strip requires 1 μg of enzyme. Therefore, one reaction can produce: Each reagent kit can have 50 expressions, giving a total output per kit of: Given that one reagent kit costs 2,000 RMB, the average production cost per test strip is: The DNA template used in the Cell-Free system is often the product from PCR reaction. The PCR reaction has a volume of 100 μL.
Each reaction requires 4 μL of primers (2 μL upstream + 2 μL downstream).
To produce the amount of enzyme needed for 2,500 strips, approximately 1,500 μL of reaction solution is required.
The total primer cost is estimated at 4,500 RMB for 1,500 μL of reaction mixture.
Hence, the cost per microliter of usable primer solution is: Each reaction consumes about 1.5 μL of primer solution, allowing for about 1,000 reactions in total, which collectively produce: Therefore, the primer cost distributed per test strip is: The acetylcholinesterase (AChE) gene is carried on the pET-32a vector with an approximate length of 9,000 bp.
At a synthesis cost of 0.5 RMB/bp, the total plasmid cost is: Each reaction uses 1.5 μL of DNA template, allowing roughly 1,000 expression cycles.
If each template batch supports 10,000 total reactions, and each reaction yields 50 test strips, the total number of strips produced per batch is: The vector cost distributed per test strip is: Adding up the enzyme reaction cost and the expression-related amortization (primers + vector): Thus, the average enzyme cost per pesticide residue test strip is approximately 0.81 RMB.
The enzyme reaction itself accounts for about 99% of the total, while plasmid and primer amortization make up roughly 1%.
Given that this estimate is based on small-scale laboratory production, the cost is expected to decrease by 10–20% with optimization, bulk procurement, and scaled-up expression, potentially lowering the enzyme cost to 0.6–0.7 RMB per strip in future production.
ii. The Base Material
Each pesticide residue test strip consists of three base materials: a PVC (plastic) backing layer with adhesive, a nitrocellulose (NC) membrane, and an absorbent pad.
Assuming the strip width is 0.004 m and the total length is 0.06 m, the NC membrane covers 0.025 m and the absorbent pad 0.02 m.
Material prices are estimated based on small-batch laboratory purchases: PVC at 20 RMB/m², NC membrane at 3,000 RMB/m², and absorbent paper at 100 RMB/m².
The corresponding material areas are: PVC 0.004 × 0.06 = 2.4×10⁻⁴ m², NC membrane 0.004 × 0.025 = 1.0×10⁻⁴ m², and absorbent paper 0.004 × 0.02 = 8.0×10⁻⁵ m².
Without considering cutting losses, the material cost per strip is: Including a 10% waste allowance: Thus, under laboratory-scale conditions, the estimated base-material cost per strip is ≈ 0.34 RMB, of which the NC membrane contributes over 95% of the total.
If large-scale procurement reduces the NC membrane price to 1,500 RMB/m², the base-material cost would drop to approximately 0.18 RMB per strip.

6.2 Other Costs

i. Packaging
Assuming each test strip is individually sealed in an aluminum foil pouch with 1 g of desiccant, and 25 strips are packed together in one box.
The aluminum pouch measures approximately 6 cm × 10 cm (0.06 m × 0.10 m), with a double-layer material area of 0.012 m².
Given the composite foil material cost of 20 RMB/m², the pouch material cost is: Including 10% manufacturing waste, the cost per pouch becomes 0.26 RMB.
Each desiccant packet costs 0.10 RMB (based on 100 RMB per 1,000 packs).
The outer box costs 2 RMB each, shared among 25 strips, giving 2 ÷ 25 = 0.08 RMB per strip.
Thus, the packaging cost per strip is: Including an additional 10% allowance for assembly and labeling losses: ii. Labor, Rent, Electricity
Direct labor per strip (8 s/strip, 30 RMB/h, 6 operators): Rent per strip (15 RMB/m²·day, 20 m², 12 s line occupancy): Electricity per strip (1.2 kW, 0.8 RMB/kWh, 3 s runtime): Total (labor + rent + utilities) per strip: And total (labor + rent + utilities) per year is 523,600 RMB.
Thus, the total production cost is 2.072 RMB per strip.

6.3 Pricing Strategy

With an annual output of 1,181,941 strips, the product is priced according to its market positioning and value rather than simple cost-plus logic.
For governmental and institutional clients such as regulatory agencies, research institutes, schools, and catering groups, we focus on reliability, accuracy, and consistent supply. The ex-factory price is set at 9–11 RMB per strip, reflecting the professional standard and credibility required in compliance and official testing scenarios.
For the agricultural and industrial segment including farmers, cooperatives, supermarkets, and produce platforms, the price is designed for scale and long-term collaboration. The range is 5–8 RMB per strip, balancing affordability with sustainable profit.
For the retail market, targeting health-conscious consumers, we offer small boxes of 5 strips (59 RMB) or 10 strips (99 RMB), averaging about 10 RMB per strip, aligning with consumer willingness to pay for safety and trust.
Assuming the sales distribution is as follows:

• Governmental & Institutional segment p₁ = 0.20 (20%)
• Agricultural & Industrial segment p₂ = 0.45 (45%)
• Retail segment p₃ = 0.35 (35%)

Substituting these values into the revenue formulas: Given the production cost per strip C = 2.072 RMB, the total cost is: The expected annual gross profit is: The corresponding gross margin is:

6.4 Cost Structure Optimization Analysis

As Pestacheck moves from laboratory to large-scale production, the cost per strip steadily decreases.
The enzyme reaction cost drops from 0.81 RMB to about 0.62 RMB per strip as larger reaction volumes, bulk reagent purchases, and better process control reduce waste and increase yield.
Base material cost falls from 0.34 RMB to 0.18 RMB mainly because of bulk purchasing of the nitrocellulose (NC) membrane (from 3,000 RMB/m² to 1,500 RMB/m²) and lower cutting waste through automated lamination and die-cutting. Some materials are also replaced with lower-cost domestic alternatives.
Packaging cost decreases slightly, from 0.48 RMB to 0.40 RMB, mainly through higher packing efficiency and larger box sizes, which reduce per-strip costs even as material prices stay stable.
Labor cost shows the biggest relative improvement, falling from 0.44 RMB to 0.15 RMB per strip as production speed triples, equipment efficiency rises, and workers become more skilled.
In total, the cost per strip declines from 2.07 RMB at the lab stage to about 1.35 RMB at mass production.

6.5 Break-even Analysis

Under the current market mix (20% governmental & institutional clients, 45% agricultural & industrial users, and 35% retail consumers), the weighted average selling price (ASP) is estimated at 8.61 RMB per strip. At the MP (Mass Production) stage, the variable cost per strip is approximately 1.20 RMB, consisting of the enzyme reaction system (0.62 RMB), base materials (0.18 RMB), and packaging (0.40 RMB). The annual fixed cost, covering labor, factory rent, and utilities, totals 523,600 RMB.
According to the break-even formula: Substituting the parameters: This indicates that the company reaches its break-even point at approximately 70,600 strips per year. Beyond this sales level, every additional strip contributes directly to net profit.
Compared to the projected annual production capacity of 1,181,941 strips, the break-even volume represents only around 6% of total capacity. This exceptionally low ratio demonstrates Pestacheck’s strong financial safety margin and resilience against market fluctuations, price compression, or production disruptions.
The break-even chart clearly shows the intersection between the Revenue and Total Cost curves near 70,000 units. Beyond this point, revenue increases at a significantly faster rate than total cost, reflecting the product’s high marginal profitability. Combined with the declining per-unit cost trend (from 2.07 RMB at laboratory scale to 1.35 RMB at mass production), the break-even threshold is expected to fall even further as economies of scale and operational efficiency continue to improve.

6.6 Financial Performance Projection

Pestacheck shows a stable and scalable profitability outlook.
Revenue comes from three main segments: governmental and institutional clients, agricultural and industrial users, and the retail market. Institutional sales currently account for around 20%, building regulatory trust and credibility. The agricultural and industrial segment contributes about 45%, providing steady cash flow, while the retail segment—currently 35%—is projected to rise to 50% by 2029 as brand recognition and public health awareness grow. Based on this mix, total revenue is expected to increase from 10.17 million RMB in 2025 to 10.69 million RMB by 2029, reflecting gradual structural growth.
Production costs are expected to decline from 2.07 RMB per strip at the laboratory stage to 1.35 RMB at full-scale production. This reduction comes from larger-scale enzyme expression, bulk procurement of materials such as nitrocellulose membranes, and improved production efficiency that cuts per-strip labor costs by about 65%.
As a result, gross profit rises from 7.72 million RMB in 2025 to 9.09 million RMB in 2029, with the gross margin improving from 75.9% to 85.1%. The improvement is driven by cost optimization and a higher share of retail sales rather than price inflation. The blended average selling price (ASP) is projected to reach 8.9 RMB per strip, further expanding unit profitability.
The break-even point remains low—around 70,600 strips per year, or just 6% of total capacity—indicating a strong financial buffer. Even with potential price or demand fluctuations, the company is expected to maintain positive cash flow.
With continued scale-up, supply chain improvements, and an increasing share of retail revenue, the company is positioned for sustainable profit growth and long-term financial stability.

7.1 Strengths

• Provides an affordable and accessible method for rapid pesticide detection, compared to expensive laboratory-based tests.
• Needs only simple operation with minimal training required, enabling farmers, consumers, and community workers to self-administer tests.
• Can be distributed widely through public health initiatives, schools, and markets with minimal infrastructure requirements.
• Helps prevent consumption of pesticide-contaminated produce, reducing long-term health risks.

7.2 Weaknesses

• The product is a disposable design, and there is a risk of solid waste and chemical residues.
• Users can misread test results, leading to unnecessary food waste.
• The testing system still relies on user consciousness and external supervision, existing a risk of misuse.

7.3 Opportunities

• Integration into food safety education in schools and community programs can enhance awareness and build long-term safety culture.
• The product has potential for adoption into public health initiatives, rural revitalization programs, and global food security projects.
• Rising consumer awareness of food safety could drive demand for household testing kits in both rural and urban markets. Promoting the stable growth of the green-certified product market in the long term.
• Aligning with SDGs (SDG 3: Good Health and Well-being, and SDG 12: Responsible Consumption and Production), the product could be applicable to developing regions facing similar pesticide use challenges.

7.4 Threats

• Some farmers or businesses only weaken the sustainable value of their products by testing rather than really improving the way pesticides are used.
• Cost and equipment dependence can exacerbate inequities between urban and rural areas and large / smallholder farmers.
• Disposable test strips generate solid waste; Chemical ingredients such as color developers may pose environmental pollution risks.