Executive summary

Business Plan

Green Crop Farming Ghana Ltd.

Moving to the next level in the value chain

SOYA BEAN MILK FACTORY

Investment of 2.400.000 GHS

600.000 USD

Ghana, 11January 2017. Version 4. Made by: Lars Bollerup

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Table of Content

1.0.0 Summary – five years actual results…………………………….…….……3

1.0.1 Summary – five years projection……………………………….…….…….4

2.1.0 History of Green Crop Farming ……………………………………….…..5

3.1.0 The market for soya milk……………………….……………………..……8

4.1.0 Marketingplan for soya milk………………………………………….……9

5.1.0 Organization for the soya milk factory…..…….. ………………….……..10

6.1.0 Timeschedule for the soya milk factory………..…………………………10

7.1.0 Investment budget for the soya milk factory………………….……….....11

8.1.0 Legal structure for the soya milk factory…………………………….…..11

9.1.0 Preliminary evaluation…………………………………………………….11

9.1.1 SWOT for the soya milk factory………………………………………….12

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1.0.0 Summary – five years actual results

Green Crop Farming Ghana Ltd. was established in 2012, and the results can been seen as below.

The results are not bad taking into consideration some extreme weather conditions in 2015 and

2016 and a nearly totally stop for production in 2014 due to a turn a round to be a certified farm.

But doing farming without doing any processing is making the farm operation very sensitive. Since

Green Crop Farming Ghana Ltd. is supposed to be listed on the Ghana Stock exchange, the issue

about the sensitive operation has to be solved.

The business plan is describing how the farm can be turned from being sensitive to being stable

moving to the next level in the value change, using its soya beans into a very profitable soya milk

factory. Below will be seen that the yearly earning will be increased from about 100.000 GHS to a

level of 5.000.000 GHS with an investment of 2.400.000 GHS/600.000 USD.

Incl. soya Only farm

2017 2017 2016 2015 2014 2013 2012

Budget Budget ACTUAL ACTUAL ACTUAL ACTUAL ACTUAL

GHS GHS GHS GHS GHS GHS GHS

Note 4 Note 1 Note 1 Note 2 Note 3

HA under plough 100 100 100 60 50 40 17

HA in use 80 80 75 40 10 40 17

Revenue (note 1) 9,680 720 1,609 580 197 540 252

Total variable costs -1,503 -255 -990 -198 -38 -183 -106

Gross margin 8,177 465 619 382 159 357 146

Gross margin in % 84 65 38 66 81 66 58

Total operating expenses -2,902 -202 -501 -254 -743 -230 -65

Result before depreciation and financial costs 5,275 263 118 128 -584 127 81

Result of operation (ROO) 4,955 103 -76 18 -210 127 81

ROO in percentage of Revenue 51 14 -5 3 -107 24 32

ROO in percentage of Equity 40 2 -2 0 -6 10 15

Equity end of year 12,363 5,111 5,008 4,555 3,308 1,319 546

Note 1: The year 2015 and 2016 was affected by too much rain / serious draught

Note 2: 2014 was used to install cleaning, drying and cooling facilities. Loss of GHS currency 226 t. GHS

Note 3:

Revenue and results 2012 derrives from Green Crop Farming Ghana A/S (Danish Holding company)as follows

DKK Exch rate GHS

Gross profit/revenue 983,517 3.9 252184

2013 2012

Equity ltd 566 142

Current account A/S 753 404

Equty total ltd 1319 546

Note 4

The budget for 2017 will be showing the impact of the Soya milk business for an entire year in full operation.

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1.0.1 Summary – five years projection

2017 2018 2019 2020 2021

Budget Budget Budget Budget Budget

GHS GHS GHS GHS GHS

HA in use 80 150 150 150 150

Litres of soya milk 1,600,000 1,750,000 2,550,000 3,750,000 5,750,000

Revenue soya 8,960 9,800 14,280 21,000 32,200

Revenue farm 720 1,350 1,418 1,488 1,563

Revenue Total 9,680 11,150 15,698 22,488 33,763

Total variable costs (note 1) -1,503 -1,784 -3,453 -4,947 -7,428

Gross margin 8,177 9,366 12,244 17,541 26,335

Gross margin in % 84 84 78 78 78

Total operating expenses -2,902 -3,483 -4,179 -5,015 -6,018

Result before depreciation and financial costs 5,275 5,883 8,065 12,526 20,317

Result of operation (ROO) 4,955 5,563 7,745 12,206 19,997

ROO in percentage of Revenue 55 57 54 58 62

ROO in percentage of Equity 40 31 30 32 35

Equity end of year 12,363 17,926 25,671 37,877 57,874

Note 1: Gross profit percentage is falling due to purchase of soya beans outside Ghana.

2.1.0 History of Green Crop Farming Ghana Ltd.

To move into the next level in the value chain, will require that the existing organization has a

mature stage. The following will describe how Green Crop Farming has been build up the last 4

years, and how the organisation is being managed. For the economical figures, please refer to

chapter 1.0.0.

The operation of Green Crop Farming Ghana Ltd. was started 24 August 2012. The operation

started at an uncleared field in the jungle without any roads, any water and any electricity. Since 24

August 2012 Green Crop Farming Ghana has been developed rapidly to a position as the leading

certified organic cash crop farm in Ghana.

Green Crop Farming was founded by Lars Bollerup from Denmark, and was later joined by other

investors mainly from Denmark. Green Crop Farming Ghana Ltd. is controlled by Green Crop

Faring Ghana A/S Denmark, that is controlled 38% by Lars Bollerup. Until now more than 3.5 Mio

GHS has been invested in Green Crop Farming Ghana Ltd. Most of the machines and equipment

are owned personally by Lars Bollerup

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Chia Seeds as the first product

Green Crop Farming Ghana was established on the idea to produce Chia Seeds with a high content

of Omega 3.6 and 9. Chia Seeds was produced until the end of 2015. In 2015 the weather condition

was so bad, that the Chia seeds was washed away from the fields. At the end of 2015 a small

production of maize was done. Based on the experiences with maize, 60 HA with maize was

planted in may 2016. The maize production ended up to be very bad since the maize was attacked

seriously by insects. Also soya beans were planted, and the yield ended up being 2000 kg per HA,

whichs gives the farm a basis for a soya milk production.

150 HA of land

Green Crop Farming has 150 HA of land available on a 50 year land lease. 100 irrigated HA is at

the time being used for production. Further 50 can taken into operation when needed. The strategy

has until now been to acquire more land. With the entering into a soya production the strategy is

rather to use sub suppliers than to develop more land.

Farm organization

Green Crop Farming Ghana Ltd. has for the last three years been manages by CEO Lars Bollerup

from Denmark. Lars has apart from his farming background degrees in economy, sales and

marketing and in law. Lars Bollerup is living in Ghana.

For four years the farm manager has been Patric Nyamedi, that has a operator background from

Vegpro Farm having 1000 acres of land.

The organization has the following week and strong points

Weak points

- Own vulcanizing equipment is needed (15.000 GHS)

- Handling of bags in the factory needs hydraulic lifting equipment (100.000 GHS)

- Drying facility outside for more effective handling (20.000)

- Farm Management can be better in efficiency

- Farm management can be better in planning the daily tasks

- The mechanics situation is difficult due to missing external education.

Strong points

The farm management is strong in keeping all machines going.

All type of machines are available for an effective operation

100 HA is fully irrigated

Irrigation system

Green Crop farming Ghana has in 2013 been building a pipeline with a length of 2,6 KM. The

pipeline is supplying the farm with sufficient water through hydrants that are connected to eight

high speed self-propelled water machines. The pipeline is connected to two 8 bar pressure pumps

delivering 140.000 litres of water per hour.

Cleaning Plant At Green Crop Farming Ghana a fully automatic cleaning, roasting and packaging plant for the

crops was delivered in 2013. The plant can effectively clean the crops,

Transparency Green Crop Farming Ghana strives after living up to the highest standard of corporate governance.

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An important element behind corporate governance is transparency. Green Crop Farming Ghana

launched in May 2013 a new home page at which the Profit and Loss Account can be seen as well

as the registration papers of the company. At Facebook it is public which activities are going on at

the farm. Green Crop Farming Ghana wants to give the fully picture of its farming activities.

Therefore good, as well as bad stories are published at Facebook.

Just in time methods Green Crop Farming is using the most modern technology and methods. ‘Just

In Time’ knowledge is used to have all tools, screws, bolts and spare parts

close to where they will be used. For bringing new parts to the farm, Green

Crop Farming Ghana has established a 2 hour delivery service from key

suppliers in Tema.

Safety first

Green Crop farming Ghana cares for the team members at the farm.

Hearing protection, helmet, masks and foot wear are provided for the team

members in order for them to be safe. The organization has its own safety

officer.

Garbage sorting

Green Crop Farming Ghana takes care of the nature. At Green Crop

farming Ghana all garbage is divided into paper, plastic, metal and oil

products. All products that can be reused are brought for recycling in Tema.

In 2015 Green Crop farming Ghana had the following waste: water 542

litres, hydraulic oil 3566 liters, engine oil 550 litres, gear oil 1299 litres,

converter oil 1416 litres, diesel oil 7545 litres, petrol 2145 litres, paper for

administration 954 kg, plastic materials 1204 kg, tree materials 252 kg,

metals 350 kg.

Effective communication

In order for the team members to keep instant connection, Green Crop

Farming Ghana is using modern walkie-talkie technology.

Solar Technology at the farm

Green Crop Farming Ghana operates in the jungle of Ghana without electricity or drinking water.

Green Crop Farming Ghana has installed 8 solar panels that delivers solar for the major machines.

Top standards to be followed Further to produce certified organic products, Green Crop Farming Ghana does also fulfil the

following standards in food production:

CSR activities

Green Crop Farming Ghana has a strong CSR program. The program is being

practiced as the company earns money. The program is about supporting

disabled people, support for orphans, eye clinics, international local school

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programs, support for HIV sufferers, water and sanitation programs, medical

clinics and nursing home

ERP system

Green Crop Farming Ghana keeps all information at an ERP

system. The system is handling traceability, stock, quality,

bookkeeping and invoicing. The system gives information about use

of e.g. petrol for pumps in both volume and currency.

Internal training

A part of part of a quality system at Green Crop Farming Ghana, a

training manual has been developed. The training manual is taking

the entire supply chain into consideration from receipt of raw seeds

till delivery at the end user. Organic Certification

As one of a very few Ghana farms, Green Crop Farming Ghana is

fully certified organic, even with the certification from Control

Union. The certification is EC as well as USDA approved.

Quality system

Green Crop Farming Ghana is striving after an ISO 22000

certification. A Q system has therefore been developed with the aim

to be ISO 22000 certified. The system is based on a Lot number

system, which traces, suppliers for seeds and for bags, traces field,

certified organic fertilizer and water Quality as some of the

parameters. Traceability system

The traceability system is the heart of the Q system at Green Crop

Farming Ghana. A lot number is stamped on all bags from Green

Crop Farming, and each Lot number can trace back all information

how the products has been produced.

Water control

Green Crop Farming Ghana has its own system for controlling the

Water Quality. The water is Q-measured at each time irrigation is

done. If any deviations, no irrigation will be done and authorities

will be contacted. All water is from the Volta River and all analysis

until now show clean water as from the tap. Humidity reporting

Humidity control is the most important control to keep away

microbiological infections. The humidity is controlled in five stages.

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Farm report

The farm reports that also refers to the Lot Number system

mentioned above, is developed to report all activities conducted at

the farm. Among others Rainfall and Fertilizer applications is

reported in the farm report.

Maintenance system

More than 30 main machines and 17

production machines are available for Green

Crop Farming Ghana. In order to keep the

uptime as much as possible, an advanced

maintenance system has been established for

main machines as well for the production

machines.

3.1.0 The Market for soya milk

The market can be divided into Asia, USA, Europe, East Africa and West Africa. Official market

sizes are available for USA, and is around 3.5 billion USD, increasing to 20 billion in a few years.

Based upon the population in Europe, the European market might be on the same size.

In Europe and in the USA, several producers are competing.

The market in East and West Africa and in the middle east seems not be described at the internet as

a source. In Ghana it will be seen in most of the “on the go” shops that Soya Milk is placed beside

the cow milk with milk as index 100 and soya as index 70, meaning that every time one on the go

milk is sold, 0.7 soya milk is sold. It is known that the import in the Tema Harbor of Cerelac and

Cowmilk with coco, vanilla and banana flavor is 4 containers per week, in all containing 160.000

bottles each 0.5 liter = 80000 liter/week x 4 weeks in a month, giving 320.000 Liter per month. If it

is assumed that the soya milk sales is ½ of the milk, the sales of soya milk will be 160.000 liter per

month just for Ghana. Milk is sold at a price of 7 GHS for 0.5 liter and Soya Milk is sold at a price

of 4 GHS for 0.3 liter, which gives the same liter price of 14 GHS. The on the go market is mainly

activated by the figures of driving cars in Ghana, and the car market is representing the middle

class. the upper middle class, and the top class in Ghana. There is 1.500.000 registered personal

vehicles in Ghana. 3 years ago this amount was 1.100.000 registered cars.

It is the assumption that similar calculations can be made for the other West African countries.

Competition

In Ghana and in West Africa is mainly one supplier of Soya Milk. The supplier is called Vita Milk.

Vita Milk is produced in Thailand, and the biggest market is the Philippines, Vita Milk is in Ghana

imported by the company Gentle Giants Co. Ltd. The company has 25 employees and is using

various local distributors to bring the Vita Milk around in Ghana. The CEO is Manuel Anane and

the marketing manager is Samuel Dankyi.

Vita Milk is delivered in 300 ML glass bottles and 250 ML/1 liter cartons. Vita Milk has three

variants: vanilla, choko and a variant that competes on the energy drink market. The energy drink

variant is soya combined with malt, barley, brown rice and brown sesame.

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4.1.0 Marketing plan for Soya Milk

Segments

A market analysis has been made of 21 customers drinking soya milk, to find out, which purchase

criteria they have, in order to define the segments in the market.

It seems that there are two segments. Segment 1, that goes after health for the buyer and/or for

buyers kids, and segment 2 that goes after getting more energy. The segments be achieved

through the distribution channels stated below.

Markets

In stage one it is the idea to focus on Ghana to learn the market better to know. This focus is

expected to last the first 8 - 12 months. Research done shows similar distribution in West Africa,

like Togo, Benin and Nigeria. The idea is to enter into Togo as the second market, then Benin. Cote

d’ivoir and Nigeria and more countries in West Africa might be interesting after more market

studies. Certain countries in the Middle Eeast might also be interesting upon further market studies.

Distribution

For the distribution the idea is to go for

- On the go market, meaning street sellers, shops near the road side. 80% of the volume is expected

to be in this segment.

- Bigger and smaller supermarkets selling. 20% volume is expected to be in this segment.

Naming of the Soya milk

As stated at the chapter “segments” above, one of the segments are kids and people focusing on the

health. By using the brand name “Jungle Milk”, a story telling can be told about the clean

environment in the jungle, providing the fresh milk. At the same time cartoon themes can easily be

created for the kids (and their parents) using social medias to follow the wild growing soya

vegetation, wild animals in the jungle, and by that creating the loyality for Jungle Milk.

For the energy segment, the word “energy” might be added to “Jungle Milk”. Final market research

might show the interest for the name and the potential story telling.

Market research commenced shows that the knowledge to soya milk is close to 76%. Among the

target group 72% knows Vita Milk.

Vita Milk is doing marketing mainly on bill boards at the road side. This marketing is expensive,

but maintains the interest for Vita Milk, but also for Soya milk in general. The Vita Milk marketing

profile is serious, and seems to follow the marketing concept that Vita Milk is using on their

markets.

For the marketing of the Jungle Milk, the following might be considered

- Trial taste of Jungle Milk in the super markets/filling stations

- Involve local doctors for their health programs at the local radio ststions.

- Involve Ghalaway for making cartoon as part of their education programs (to create interest)

- Let the local Ghana TV stations visit the factory (to create awareness)

Placing the nice designed bottles at strategic traffic points, e.g. Tema Motoway roundabout

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5.1.0 Organization for the soya milk factory

With reference to the board, Lars Bollerup will take the lead as the CEO for the Soya Milk Ghana

Ltd. Lars Bollerup has been the founder behind Green Crop Farming Ghana, and has been living in

Ghana the last three years. Lars Bollerup will be the only that is also has to do with Green Crop

Farming Ghana, whiles all other team members will be new in the organization.

Board

Buy establishing the 100% owned subsidiary to Green Crop Farming Ghana Ltd. a professional

board is supposed to be registered for Green Crop Faring Ghana Ltd. with the purpose of

controlling the new Soya Milk Ghana, and with the purpose of a listing at the Ghana Stock

Exchange as soon as possible.

The board is supposed to be appointed as follows:

- Vice president for the Farmers Association John Dziwornu

- Director for BHJ Ghana John Agyemfra, distributing meat in Ghana

Consultant Christopher Adjei, Ghana Standard board, taking care of all approvals

- A board member will receive 6000 GHS per year.

The board will be offered timewise unlimited shares in Green Crop Farming Ghana Ltd. until the

registration at the Ghana Stock Exchange will take place.

Sales

The positon is supposed to be taken by Mr Kobby Sela, that at the moment is Marketing Manager at

the Ghana Food and Beverage Association. Mr. Kobby has more than 10 years experience in

serving the segments for Jungle Milk.

Production

The production will be managed by an expat from China. Ghana has no competences in Soya

production. The expat will stay in Ghana for three years and will train two highly educated persons

from Accra to take over when the expat period of three year is ending. The two candidates is

supposed to be certified to take over the job as production manager and assistant manager.

Technics/electric matters

On the technical side, an expat from China will do the management. Ghana has only a very few

competences in technical matters. The expat will stay in Ghana for three years and will train two

highly educated persons from Accra to take over when the expat period of three year is ending. The

two candidates is supposed to be certified to take over the job as production manager and assistant

manager.

6.1.0 Time Schedule for the soya milk factory

The time schedule for establishing the soya milk factory can be seen as below. The time from

investment sum is paid and until the soya factory is built and the first product is on the market is 5

months.

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Investment timeschedule with responsibilities and timing (5 months)

Month 1 2 3 4 5 6 7 8 9 10 11 12 Responsible

Design cartons Lars

Design sachets Lars

Shipment Lars

Clearing port Lars

Installation Expat

Approvals Lars

Q system Chris

Training sales Kobby

Sign up distribution Kobby

Training production Expat

7.1.0 Investment Budget

The investment budget is 2.400.000 GHS (600.000 USD), and the potential bottom line of the

operation is around 4 mio GHS per year based on a sales of 1.600.000 litres of soya milk per year. It

is estimated that the soya milk market in Ghana is 1.920.000 litres per year. The sales of the Jungle

Milk is supposed to increase market, take market shares from Vita Milk or being exported to other

countries. The “add on” / extra capacity costs for the soya plant factory is 700.000 GHS except

from marketing costs. Since the gross profit per litre is 4.82 GHS, the minimum sales is 145.000

litres per year or 725 litres per day.

8.1.0 Legal structure for the soya milk factory

The soya bean factory is supposed to be owned by a separate limited legal ltd. company. The new

legal identity is supposed to have only the required minimum of stated capital. The new company is

supposed to be called Soya Milk Ghana Ltd. The company is supposed to be owned 100% by Green

Crop Farming Ghana. New shareholders will by that also get ownership to the farming activities.

9.1.0 Preliminary evaluation

GHS

Grubber 5.000

Red China tractor 10.000

Swathering machine at machinery dealer 200.000

Pipeline 2.400 meter * 350 GHS/meter incl. digging/laying 840.000

Hydrants 25 x 1000 GHS 25.000

Landlease remaining 46 years 70 HA cleared land partly 140.000

80 HA developed land x 25.000 2.000.000

Irrigation machines 8 machines x 200.000 GHS 1.600.000

Sprayer 30.000

Goodwill, name, knowledge, customers etc. 250.000

Organic certification 1.000.000

Total value Green Crop Farming Ghana 5.200.000

51% share value is 5.200.000/100*51=2.652.000

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9.1.0 Preliminary evaluation of machines owned by Lars Bollerup

GHS

Backhoe 150.000

IH 1255 150.000

IH 1055 80.000

IH 844 50.000

Harrow1 20.000

Harrow 2 18.000

Pump at riverside 120.000

4 containers 35.000

Tools 50.000

Harvester red 250.000

Harvester green 140.000

Flailmover 35.000

Rotary tillers 35.000

Seppi moulcher 35.000

Value Lars Bollerup machines 1.168.000

The machines are rented out to Green Crop at a price of 15.000 GHS per month. All

repair costs are paid by Green Crop. The machines are also used for external farming

activities also. Income from such activities belongs to Green Crop.

9.1.1 SWOT for the soya milk factory

Strengths (internal)

Green Crop Farming has proved the last four years that business can be done, even in the difficult

part of Ghana.

The production and technical management will be from china

Weaknesses (internal)

Few daily management resources

The china management might show up to have a different culture

Opportunities (market)

The middle class is growing rapidly

The soya milk market is increasing together with the middle class market.

Soya is the only product with omega 3, 6 and 9, together with all needed amino acids.

Soya is the only products that gives energy and prevents Alzheimer and Parkinson

Threats (market)

Energy drinks with Amino acids and Omega 3, 6 and 9.

Almond Milk, Rice Milk