business plan for dairy farm (entrepreneurship)
DESCRIPTION
In this particular presentation I have covered almost all the aspects related to starting a very new business especially in Pakistan. I hope this will help all the interested business students across the world. Remember me in your precious prayers.TRANSCRIPT
PRESENTATION ON BUSINESS PLAN
GROUP MEMBERS :
Wajid Ali 3335
Haifa Saleem 3336
Shakeel Aslam 3338
PRESENTED TO:Mr. Usman M Ghauri
• Dairy farming is not an organized sector in Pakistan.
• The demand of commercial dairy farms is increasing day by day and there is a much market potential and growth in this business.
• Livestock is an
important sector in Pakistan’s economy and contributes about 11.9 percent in the GDP of Pakistan .
“Business Profile”
• Type : Private• Industry : Dairy Farm • Founded At : Kharian, Gujrat• Phone No. : +92-53-123-
4567• Email Address :
[email protected]• Founder(s) : Wajid Ali
Haifa Saleem Shakeel
Aslam
Dairy Gardens (Our Business Name)
(Our Logo)
“Nothing but Milk" (Our Slogan)
Our Vision“Our Farm is committed to provide quality and unadulterated milk to our customers.”
Our Mission“Work, Maximize and Grow.”
Our Philosophy“Work to Excel.”
BUSINESS PLAN
Description of the Business• Our farm is into the business of selling
quality cow milk.
Growth Trends in This Business• The market for cow milk is always
growing constantly.• Pakistan's annual milk production has
more than doubled in the last 20 years, rising from 15 million tones to 36.2 million tones in 2013.
Business Organization• The form of organizational structure chosen for
our dairy farm is partnership, as the capital required is very high and the entire range of business activities can not be efficiently handled by a single person.
Licenses• License is not mandatory for dairy farming but
we’ll prefer to get registered our dairy farm.
Insurance• Each cow would be insured with “Adam Jee
Insurance” with a premium of Rs.12,500 per annum.
PRODUCT
PRODUCT
CONSUMER GOODS
INDUSTRIAL GOODS
Core part
Actual part
Augmented part
Healthy
Fresh
Nutritious
Pu
rit
y
Volu
me
No augmented part
• With the every passing day, dairy products are becoming costlier because livestock farming has not scientifically grown with the increase in population.
• In Pakistan, price of milk increases by 5-10 % per liter annually.
• Growing demand for dairy products is driving local milk prices.
• The milk price varies according to its quality and the season.
• In an average, it is sold at RS. 80-90 per liter in the direct consumption in Kharian and in its surroundings.
• We have decided that price of our milk will be in accordance with the response of customers preference and competitors’ price, we are going to introduce our product so our price will be low as compare to other milk suppliers i.e., Rs.70/liter.
o We have chosen Kharian for starting our dairy farm business, because this particular location provides us multiple advantages.
o Kharian is one of the proprietor’s home town and having his family goodwill in this area from last 5 decades. Therefore support of people will be always with the Dairy Gardens.
o Well constructed road connected to GT Road (approx. 10 km away) with two way.
o Well irrigation system is available.
o Veterinary hospital facilities are near by.
o Also the people of Kharian prefer fresh milk over processed milk, that’s why it is highly demanded in the said area due to scarcity of good quality of fresh milk because the people of this area have shifted their focus from livestock to other activities.
o Also the per capita income in said area is relatively high because people from Kharian (both rural & urban areas) are working in Gulf & European countries.
o That’s why they are always willing to buy fresh milk without bothering about its price.
o And one of the biggest advantage we have is the range of “Pubbi Hills” that can be used for grazing without incurring any cost.
Pubbi Hills
PROMOTION
Advertising
• Broachers for retailers.• Advertisement by local newspaper.
Personal Selling
• We’ll distribute milk to the retailers.
Public Relations
• We’ll be involved in the community.• We’ll also offer open selling of milk
directly from the farm.
Market Segmentation
SSegmentation Variable
Data
Demographic Age NA
Gender Male , Female
Family size NA
Family life cycle Married , Unmarried
Psychographic
Social class Lower middle class, Upper middle class
Lifestyle NA
Behavioral
Occasion NA
Benefits Quality, Taste, Purity, Nutritious
User Status First time user
TARGET CUSTOMERSLocal peopleo These are the local customers in surrounding areas who directly buy
the milk from the farm.
Gawalaso The local term used for milkman. They are the business customers
and further sell the milk to households in nearby towns.
Milk Collection Companieso Nestle and other local companies who have plants for processed milk
are also focused as target customers.
Hotels and Bakeries o We have planned to deliver the milk in major hotels and bakeries in
Kharian and other cities of District Gujrat.
COMPETITORS ANALYSIS
B to B Customers (Dealers will not be involved with Dairy Gardens)
Particulars Deals
Industry Food oriented: 3-5% discount depending upon order and location.Retailers: 5- 8% depending upon the quantity and location.
Location Kharian City and Cantonment: 5% for retailers, 10% for Food oriented businesses. All nearby Villages: 10.5% for retailers, 8% for Food oriented business.
Size of the firm Larger the firm, larger the discounts (according to order)
Competitors:
Currently, there are not many dairy farms operating in Kharian & surrounding areas. But the some major market players are as follows:
Ghulam Qadir & Son Dairy FarmHussain Dairy FarmWestern Dairy Farm
SWOTANALYSIS
STRENGTHS
o High domestic consumption
o Good milk quality
o Full personal involvement
o Market is not going to ruin
o Income from the day first
o Utilization of wastes (Cow Dung)
WEAKNESS
o Unorganized sector, unaware of basic farm management practices
o Farmers lack of technical skills, initiative and experience in modern dairy farming
o Low application of research work
o Production losses due to endemic diseases every year (according to the research)
OPPORTUNITIESo Government of Pakistan & Sate Bank of
Pakistan priority sector
o Dairy products needs are much higher than supply
o Commercially viable sector with great credit potential and absorption capacity
o There is no strong supplier in the market
o High revenue
THREATS o High risks of diseases in live stock
o Unorganized sector in Pakistan, needs a lot of cleaning
o High risks of diseases in live stock
o Power Crises
o There is always a possibility of a competitor entering the market
Market Opportunityo Pakistan is the forth largest milk producer in
the world.
o Largest irrigation network in the world.
o Livestock is contributing about 52.2% to the agricultural sector of Pakistan.
o The milk market is growing at a growth rate of 4.5% annually with increase in milk consumption.
o Also metropolitan cities are the major markets for the sale of milk.
FINANCIAL PLANEstimated data for financial plan:
o Proposed Breed: Jersey Cow
o No. of cows – 30
o Cost of the cow – Rs.250,000
o Average milk produced per day will be 600 liters
o Price for the milk will be Rs.70 / liter
FARM REQUIREMENTSLand:
About 1.0 acres of land will be required. (25-120 animals maximum)
The agricultural land cost per acre in our proposed location (In My village, 10 Km from GT Road Kharian) is Rs.800,000.
Labor: A supervisor (farm manager) will be hired to supervise all
the farm activities. Three farm workers will be hired for handling 30-animals.
Machinery & equipment: Water pumps Milk utensils. Fodder Chopper Freezers Tanks
Feed for AnimalsIt includes dry matter and concentrate to increase animal productivity.
Dry Roughage Green RoughageSummer Fodder Winter Fodder
Wheat Straw Maize BerseemRice Straw Sorghum Alfalfa (Lucerne)Oat Straw Millet OatsMaize/Sorghum Stubble Mott Grass Rye GrassSugarcane Baggasse Sadabahar Sugarcane topsCotton Seed Hulls Guar
Fodder Daily Requirement
(kg)
Cost/kg Amount (Rs)
Dry 9.38 3.00 28.14
Concentrate 4.62 15.55 71.86
Total 100
Daily Feed Requirements of Cow
TOTAL INFRASTRUCTRUE COSTDescription Sq ft Rate/Sq ft Total Cost
Shed for Cows 2,300 450 1,035,000
Open Paddock for Cows 2,300 50 115,000
Shed for Calves 816 450 360,000
Open Paddock for Calves 816 50 40,800
Stores for fodder & machine
room
300 450 135,000
Utensils & milk storage 300 450 135,000
Servant Room, Wash room 300 650 195,000
Silage Bunker 2500 150 375,000
Total Infrastructure
Cost
9,632 - 2,390,800
PROJECTED START UP WORKING CAPITAL/month
Description - Unit &
Specification
Total Cost
Man Power 10,000*3 = 30,000
20,000*1 = 20,000
50,000
Driver 10,000*1 = 10,000 10,000
Doctor + Medicine 10,000 + 10,000 20,000
Fodder + All required Rs.100 * 30 Cows /day 90,000
Green fodder Farming in own land 10,000
Diesel/Petrol Transport + Generator 50,000
Electric + Phone bills 15,000 + 10,000 25,000
Stationary - 1,000
Insurance 12,500 * 30 =
3,75,000
3,75,000
Total Working Capital 6,31,000
PROPOSED PROJECT COSTDescription Unit & Specification Total Cost
Land & Land Development
Cost
8,00,000 + 2,00,000 10,00,000
Infrastructure Cost / Civil
Works
2,390,800
Animals Cost 2,50,000 * 30 =
7,500,000
7,500,000
Cost of transporting of
Cows
From purchased town 1,50,000
Pick up Van 6,50,000 * 1 = 6,50,000 6,50,000
Chaff Cutter 20,000 * 1 = 20,000 20,000
Generator (Honda 3 KVA) 1,50,500 * 1 = 1,50,500 1,50,500
Electric Connection ( 3
KVA)
- 20,000
Pump set (including pipe) Plant + Farming 2,00,000
PROPOSED PROJECT COSTDescription Unit & Specification Total Cost
Furniture 20,000
Tube lights + Fans + wiring 20 + 15 + as per required 25,000
Deep freezers 25,000 * 2 = 50,000 50,000
Coolers 2,500 * 3 = 7,500 7,500
Cans40 ltr * 4 * 8,500 = 34,00020 ltr * 5 * 4200 = 21,00010 ltr * 5 * 2200 = 11,000
66,000
Office Equipment PC * 15,000 * 1 = 15,000 15,000
Contingencies (3.5 of Project Cost) 4,22,268
Initial Working Capital - 6,31,000
Total Project Cost - 13,318,06
8
FARM OUTPUTS Lactation Periodo The lactation period is the period during which the animals
yield milk. Generally the lactation period of cows is from 280 days to 300 days.
o The average milk yield of Cow is estimated at 5,600 to 6,000 liters per lactation.
Male Calveso 3 months old male calves will be sold at the farm sooner
after birth for Rs.10,000 - 15,000 per animal.
Milko The milk will be sold to Gawalas, milk processing
companies, house holds & milk shops @ price range Rs.70/liter.
o Milk can be stored in a milk chiller / freezer, if milk collection is not possible in the evening.
SALES FORECAST
Income From MilkMilk per day 30 Cows * 20.00 liters = 600
liters
Rate of Milk Rs.70 per liter
Daily Income from Milk 600 liters * Rs.70 = Rs.42,000
300 Days Income from Milk 300 days * Rs.42,000 = 12,600,000
FINANCIAL PROJECTIONSo We have invested 9.0 million rupees for our proposed dairy farm.
The details are as;
1) 70% of the money is invested equally by three friends.
2) Other 30% of the require money will be borrowed from the bank.
o We will achieve breakeven at the start of second year.
o The second year will increase the profits and at the end of second year, we will get back the money borrowed from the bank.
CONCLUSIONo Now we can say that the dairy farm products are
essential in the human life and the demand for milk can never be ended also in future the demand of milk will be increase.
o In our business plan we are to produce the qualitative milk for the general public and sell to local market and also to sole customer.
o Our proposed business has not a large scale so it will never capture the whole market because day by day the number of competitors can be increase in the market and they can offer various kind of products with services.
o Finally we can say our business plan is good for small and local market and our first motive is to capture the local customer.
Thank You!!
“Believe and you will achieve”