Oyster Mushroom Farming: Faculty of Management Studies PCBA-PICS

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University Of Central Punjab

Faculty Of Management Studies PCBA-PICS
Oyster Mushroom Farming

Table Of Contents
EXECUTIVE SUMMERY ...................................................................................................... 3
WHAT IS MUSHROOM ........................................................................................................ 5
OYSTER MUSHROOM...................................................................................................... 7
BOTONICAL DESCRIPTION ........................................................................................... 8
INTRODUCTION.................................................................................................................... 9
ORIGIN ............................................................................................................................... 11
MUSHROOM CUTIVATION REVIEW ........................................................................ 11
VISION STATEMENT ......................................................................................................... 12
MISSION STATEMENT ...................................................................................................... 12
SLOGAN ................................................................................................................................. 13
OBJECTIVES ........................................................................................................................ 14
MUSHROOM MARKET ...................................................................................................... 15
OVERALL MUSHROOM MARKET ............................................................................. 15
OVERALL OYSTER MUSHROOM MARKET ............................................................ 16
PAKISTAN MUSHROOM MARKET ............................................................................ 17
DEMAND AND SUPPLY ..................................................................................................... 17
NUTRITIONAL INFORMATION ...................................................................................... 18
SWOT ANALYSIS ................................................................................................................ 22
STRENGTH ........................................................................................................................ 22
WEAKNESS ....................................................................................................................... 23
OPPORTUNITIES ............................................................................................................. 23
THREATS ........................................................................................................................... 23
OPERATIONAL FLOW....................................................................................................... 24
CHART ................................................................................................................................... 24
ORGANIZATIONAL STRUCTURE .................................................................................. 35
TARGET MARKET .............................................................................................................. 37
MARKETING MIX ............................................................................................................... 38
PRODUCT .......................................................................................................................... 38
PRICE ................................................................................................................................. 39

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PLACE ................................................................................................................................ 40
PROMOTION .................................................................................................................... 40
GAP ANALYSIS .................................................................................................................... 41
COMPETITORS ANALYSIS .............................................................................................. 42
Direct Competitors ............................................................................................................. 43
Indirect Competitors .......................................................................................................... 44
FINANCIALS ......................................................................................................................... 45
INITIAL CAPITAL INVESTMEMT .............................................................................. 46
PROJECTED INCOME STATEMENT .......................................................................... 47
BALANcE SHEET ............................................................................................................. 48
BREAK EVEN POINT ...................................................................................................... 49
PAY BACK PERIOD......................................................................................................... 49
MINUTES OF MEETINGS .................................................................................................. 50
BUSINESS CARDS ............................................................................................................... 57
PICTURES ............................................................................................................................. 58
REFERENCES ....................................................................................................................... 60

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EXECUTIVE SUMMERY

The project of Oyster mushroom farming is done by Mr. Sulman, Miss. Sana and Mr.
Umair and Mr. Jawad who are doing MBA from University of Central Punjab.During our
research on oyster mushroom farming in Pakistan we met and interviewed different people
and after thorough analysis of the market, business components and with our joint efforts and
courage we have devised a business plan under supervision of Professor Farooq Hussain.

The market research we conducted concludes that the people are still not much
familiar about fresh mushroom industry of Pakistan and there is a clear gap in demand and
supply, this makes the industry a very good opportunity for investment.
We will grow fresh mushrooms at our farm and supply it to pizza parlors of Lahore. We have
planned the business operations in terms of its components; operational flow chart with
detail, swot matrix, marketing mix and organizational plan. Our targeted customer belongs to
pizza makers and fast food industry.

For this, we visit Agriculture University and also visited some pizza parlors in
Lahore. We tried to understand their needs and also we note some other aspects like taste and
nutritional values. After overall analysis including the financials, we came to know that this
business is very successful as there is a huge profit margin instead of any other business. But
the major side is that there should be demand of mushrooms in the market. If it is not, then
our production is like wastage. So we should produce mushrooms according to demand in the
market.

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Oyster Mushrooms Farming

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WHAT IS MUSHROOM
?

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Mushrooms are considered as the fifth largest vegetable. A mushroom is a type of
fruiting body of a fungus. Fungi are organisms that are free of chlorophyll and therefore
cannot do process of Photosynthesis. Some fungi produce mushrooms for the purpose of
reproduction, releasing spores into the atmosphere. Fungi got their energy through
biochemical decomposition processes.

Mushrooms are type of fleshy plants that belong to the fungi group. They grow from
decaying materials and just like fungi, they dont have chlorophyll. They usually grow in cool
and moist places. In pastures, meadows, and woodlands they are mostly found. At commercial
level they are cultivated in caves, indoors on shelves filled plant materials, and in greenhouses
where the average temperature is cool.

Mushrooms are in different colors such as white, orange, red, and brown. They also
differentiate in sizes and shapes. The most common mushrooms have short, thick stems and
umbrella like fleshy caps. Some mushrooms are poisonous. Mushrooms are cultivated as it is
used by humans mainly as a source of food. Aside from food aspect, these mushrooms also
have medicinal properties, because they contain lovastatin which is a substance used in
medicines for heart patients; Lovastatin lowers the cholesterol in the blood. Mushrooms are
richer in proteins than other green plants.
It contains minerals like iron, phosphorus, potassium, and calcium and is rich with
vitamins. It is also filled with fibers that help in digestion in humans. Thus, mushrooms are
considered as perfect food, and are also very popular around the world.

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Mushroom industry is boosting in world as its consumers are increasing day by day.
According to the China Edible Fungus Association, their National Mushroom production in
2006 is about 1 4.37 million tons, that is more than 70% of world output. The demand for
mushrooms is relatively increasing strongly.

The future of many of the mushroom species is bright. Production of mushrooms
overall in the world has been increasing due to contributions from countries such as China,
India, and Vietnam. There is also much experimentally based evidence regarding the
nutritional and medicinal benefits related to mushrooms. In Africa, medicinal mushrooms
trials conducted for AIDS patients are also promoting the benefits of mushrooms.

OYSTER MUSHROOM
Oyster mushroom (Pleurotus sp.) is belonging to class Basidiomycetes and botany
family Agaricaceae. It is locally known as Khumbi in Pakistan. It grows naturally on dead
and decaying wooden logs. It also grows on decaying organic matter. The fruiting body of
this mushroom is distinctly shell shaped. They appear with shades of white, cream, grey,
yellow, pink or light brown depending upon the type of species. It is one of the most suitable
fungal for producing protein rich food without the process of composting.

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BOTONICAL DESCRIPTION

The oyster mushrooms have three parts.
1. A shell shaped cap.
2. A short or long central stalk.
3. Long ridges and furrows.

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INTRODUCTION

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Our project is basically the cultivation of the oyster mushrooms. Mushrooms are now-
a-days included in the fast food items such as pizza. Mushrooms are of various kinds like
buttons mushroom, oyster mushrooms and so on. But here our focus is basically on
cultivation of Oyster mushrooms. The reason behind choosing oyster mushroom cultivation is
its sensitivity level. Oyster mushrooms are less sensitive according to other kinds. If we want
to cultivate Button mushroom, then it should also be noticed that these are very sensitive to
temperature and other factors like humidity, light, moisture and so on.
Our major reason for choosing this project is the rising needs of fast food items in the
market. If we take an example of Lahore market, we came to know that now-a-days, there
were many pizza parlors and they are working across every market. And Mushrooms are the
needs of pizza. Mushrooms can add a taste to pizza and also they are enriched with many
vitamins and carbohydrates. The trend of people is changing day by day and in food market,
trend is highly shifted towards pizza.
In our topic, we are just cultivating the mushrooms and deliver them to the market. So
we are not going to use other methods like drying, packing and so on. We are just cultivating
the oyster mushrooms and sale them directly to the customers. So there are no intermediaries
involved and the channel of distribution is direct distribution.

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ORIGIN
Cultivation of oyster mushroom was firstly initiated in 1917 in Germany by Flack on
experimental basis on tree stumps and wood logs. Cultivation of different varieties of oyster
mushroom was initiated in Pakistan in 1975 by Dr Muhammad Asif Ali. Commercial
cultivation began in mid nineties.

MUSHROOM CUTIVATION REVIEW
In the fresh form, about 45 percent of mushrooms produced are consumed only. The
other 55 percent is processed in the canned form. This percentage is because their fresh form
shelf life is very short. Thats why in world market, mushrooms are found in canned form.

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VISION STATEMENT

To be market leader of fresh oyster mushrooms with low price and best quality.

MISSION STATEMENT

Our mission is to provide best quality of fresh oyster mushrooms to fast food
chain to achieve greater stakeholder value through satisfaction of customers
demands.

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SLOGAN

Delicious And Healthy Are Only Mushrooms.

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OBJECTIVES

To provide fresh mushrooms in the market with least price.
Introducing fresh mushrooms as an alternative of canned mushrooms.
Pioneer in fresh production market.
Aware about nutritional benefits of mushrooms.
Create new employment opportunities.

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MUSHROOM MARKET

OVERALL MUSHROOM MARKET

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There are 14,000 described species to be considered as mushrooms. The valuation of
overall world market for the mushroom industry in 2005 was over $45 billion. The
mushroom industry can be divided into three main categories
1. Edible mushrooms.
2. Medicinal mushroom products.
3. Wild mushrooms.
Holland and China are the world largest exporter of canned mushrooms with a market
share of about 68.5 percent. Moreover, France is another important exporter with contribution
of about 13.5 percent of the world exports.

OVERALL OYSTER MUSHROOM MARKET

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PAKISTAN MUSHROOM MARKET
Mushrooms have earned 6.9 million dollars for exports by Pakistan in 2008 and they
are exported to France, Switzerland, Germany, UK and New Zealand. Mushrooms of
Pakistan earned good market price in international markets ($71 per kg) as it shows only
97,000 kg earned about 6.9 million dollars. Pakistani exports decreases due to only one
reason. The reason is that our market is not fulfilling the demands of international markets so
the consistency in production is not maintained.

DEMAND AND SUPPLY

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Oyster mushroom is not as popular as white button mushroom in the domestic market.
For export market, some companies are cultivating it. Cultivation of oyster mushroom is
more profitable as compared to white button mushroom. The reason for this is the low capital
costs. The cultivation of oyster mushroom is very simple and economical where raw
materials and facilities required are easily available.

At present, Marketing of fresh oyster mushroom does not have any problem due to its
very low production on commercial basis. Generally, the international market for oyster
mushroom is very high as it is not meat by some producers. It should be more successful in
local market as demand is not so much and our production is also to that extent that it meets
up with the demand. So the demand and supply meet up in local market, not in international
markets.

NUTRITIONAL INFORMATION

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Calorie Information
Calories 22.0 (92.1 kJ)

From Carbohydrate 11.1 (46.5 kJ)

From Fat 2.8 (11.7 kJ)
From Protein 8.1 (33.9 kJ)

Carbohydrates
Total Carbohydrate 3.3 g
Dietary Fiber 1.0 g
Sugars 1.7g
Fats & Fatty Acids
Total Fat 0.3g
Saturated Fat 0.0g
Monounsaturated Fat 0.0g
Polyunsaturated Fat 0.1g

Total Omega-6 fatty acids 139mg

Protein & Amino Acids

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Protein 3.1 g

Minerals
Calcium 3.0 mg
Iron 0.5 mg
Phosphorus 86 mg
Sodium 5.0 mg
Zinc 0.5 mg
Copper 0.3 mg
Manganese 0.0 mg
Selenium 9.3 mg
Potassium 318 mg
Magnesium 9.0 mg

Vitamins
Vitamin A 0.0 IU
Vitamin C 2.1mg
Vitamin D 18 IU
Vitamin E (Alpha Tocopherol) 0.0 mg
Vitamin K 0.0 mcg

Thiamin 0.1 mg

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Riboflavin 0.4 mg
Niacin 3.6 mg
Vitamin B6 0.1 mg
Folate 16.0mcg
Vitamin B12 0.0mcg

Nutritional COMPARISON OF DIFFERENT MUSHROOMS
Preparation Serving
Size
Carbohydrates Fiber
(g)
Fat
(g)
Energy
(kj)
Oyster Mushrooms 100g 6 2.5 0.5 155
Button Mushrooms - raw 100g 1.5 2.5 0.5 100
Mushrooms - canned 100g 1.5 3 0.5 65
Chinese Mushrooms - dried
& rehydrated
25g 4 0 0 60
Enoki Mushrooms - raw 100g 7 2.5 0.5 145
Shitake Mushrooms - dried 4 (15g) 11 1.5 0 185

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SWOT ANALYSIS

STRENGTH

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1. New idea in market.
2. People already have taste of mushroom.
3. A huge profit margin.
4. Raw material with lower cost.
5. Lesser initial investment.
6. Rising trend for fast food items.
7. Climatic conditions fit for mushroom production.
WEAKNESS
1. No specialist for mushroom farming.
2. Mushrooms are spoiled in 3 to 4 days.
OPPORTUNITIES
1. Decline in canned production in world market.
2. Adopt latest technology.
3. Raise the production to meet international market.
4. Hire a mushroom specialist to identify problems and resolve them.
5. Made delivery as early to avoid loss due to spoilage of product.
THREATS
1. Existing canned mushrooms market.
2. Risk of increasing demand being satisfied from competitors.
3. Government policies.
4. Risk of supply exceeding demand if markets not developed.

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OPERATIONAL FLOW
CHART

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Building acquisition
Cotton Waste
arrangement
Care Takers Spawn Order Polythene
Bags Order
Raw Material Arrival
Wetting Moisture Level
Accurate
Inaccurate
Filling of Bags
Cover the Bags
Temperature
Regulation
Un cover bags
after 2 weeks
Growth Of 40
Days
Cut if flower is
completed
Wait 5 days
more
Cut Before
Maturity
A Category
B Category C Category
PACKING
DISPATCH
Spawn Spray
Precaution

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1. Building Acquisition

The building that is used for our project is the poultry control shed that is already
established in okara. The reason for choosing this building is that this control shed is now in
the premises of the city and the Environmental department is not issuing the license for that
building. So this control shed is vacant and we are using it as an alternative for mushroom
cultivation. The size of the control shed is appropriate for our project. Moreover, all the
equipments required are already available here. So we dont need temperature regulator or
humidity controller.

2. Cotton Waste Arrangement:

The next step is to arrange the cotton waste which is our basic raw material. Cotton
waste is the medium on which the mushrooms are cultivated. Cotton waste is the most
suitable material because they provide better medium for mushroom growth and also they are
more economical than wheat straws. So we order in satluj cotton mill in okara for cotton
wastes. It is more economical to us because this cotton mill is close to our building so,
transportation cost is less.

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3. Spawn Order:
Spawn are the seeds that are used for growing the mushrooms on the medium. Spawn
are sprayed on the surface of the cotton waste that further converts into mushrooms. We
should made order of spawn to University Of Agriculture Faisalabad where it is easily
available all the time. The cost for spawn is 500 per kg. So we should order spawn according
to our production requirements.

4. Polythene Bags Order:
Another major raw material for our mushroom farming is the polythene bags. These
are the bags in which cotton waste is covered and in which the medium for mushroom growth
is provided. These bags are easily available in the market and we should order these bags in
near market. These bags cost 100 per kg and there are about 250 bags in one kilogram. The
size of these bags should be 8 x 12.

5. Care Takers
These are the persons that are hired for the purpose of caring the mushrooms. They
are trained for the mushroom farming and they have complete know how about mushroom
cultivation and its cutting. So for our production, we should hire 2 persons for our farm that
continuously look after the farm and the mushrooms.

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6. Raw material Arrival
After the ordering, all the raw materials including cotton waste, polythene bags and
spawn should reach the farm within two days. All these things were collected by the care
takers and it is their responsibility to look after all these materials. All these things were
initially placed in our building at one place.

7. Wetting and Moisture Level
This is the initial procedure in which the cotton waste is watered and leave for some
time. The basic purpose for this process is to create moisture in the cotton waste or our
medium which is an initial factor for mushroom growth. We should place cotton on floor and
leave for certain time. When adequate level of moisture is attained, we start filling this cotton
waste into polythene bags. The level for moisture is that you should fill it into bags when you
grip cotton into your hands and your hands feel slightly wet.

If the moisture level is adequate and suitable for the mushroom growth, then we
should packed these into the polythene bags. But in some cases, the moisture level is not
suitable and the cotton waste dry. In such situation, we should repeat all the procedure again
and then again try to attain the required moisture level.

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8. Precautions
In this section, we should follow some precautionary measures for our farming. This
is done to kill some pests that affect growth and are present in the media. To avoid these
pests, we provide water steam to our media or maintain temperature of 58 to 60 degree
centigrade. On such temperature, we placed our media for 4 to 6 hours. During this time, all
the pests were killed.
9. Filling Of Bags
The bags are to be filled with the wet cotton waste. 8 x 12 bag should contain 1000
grams of wet cotton waste. The weight of wet cotton varies from size of the bag. If the size of
the bag is larger, then more cotton waste in wet form is filled into it. So we should fill wet
cotton according to our desired bag size.
10. Spawn Spray
The next step is to spray spawn on the medium. As we know that our medium is wet
and contains moisture. So we mix up the spawn into the bags with a certain quantity. The
suitable quantity for spawn is 1 to 1.5 percent of the weight of wet media. For example if the
weight of our wet polythene bag is 1000 grams, then we should mix 10 to 15 grams of spawn
into the bag.
11. Cover The Bags
The next step after the spawn spray is to cover the bags. The bags are covered in such
a way that their front opening is closed but there should be a passage for air. It is because the
growth phase of mushroom requires air along with moisture. If the bags are air tight, then the
spawn is unable to spread.

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12. Temperature Regulation
The next step in our cultivation process is to maintain or regulate accurate
temperature for the mushroom growth. For the first three weeks, the temperature should
maintain at 16-25 degree centigrade. This is because the initial weeks of mushroom growth
are sensitive and requires adequate temperature level. After 4 weeks, the temperature should
be raised to 28-30 degree centigrade and this temperature helps in mushroom flower growth.

13. Un Cover Bags
After 2 weeks, the front of the bags was opened. This is done because the flower
should grow in the direction of open end. So it is necessary to open the bags after two weeks.
If the bags were not opened, then the mushrooms start spoiling inside the bag and such
mushrooms are unable to grow.

14. Growth
Then we left these bags for entire 40 days. The whole process of mushroom growth
takes 40 days. During these days, we should check regularly the temperature, humidity and
moisture level.

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15. Cutting
The next step is the cutting process. After 40 days time period, the mushrooms are
able to cut. So the care taker cut these grown mushrooms with the help of a simple knife. Be
careful while cutting because these mushrooms have to grow again. So cut the mushrooms
from appropriate position.

16. Wait 5 days
But in some cases, the mushroom flower is not grown properly in 40 days. In such
cases, we should not cut these flowers and wait for maximum 5 more days to grow. During
these days, the mushroom grows its entire flower and attains a certain level to cut it off.

17. Maturity level
But mushroom flower also has a maturity level. This maturity means that the flower
of the mushroom should reach a certain level after which it starts crushing. Another thing that
includes in maturity is the color of the mushroom flower. When any mushroom flower
reaches at maturity stage, then the color changes to white or some time fade color also
represents the maturity level. So to avoid this, it is necessary to cut these flowers at proper
time.

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18. Mushrooms Category
After cutting the mushroom, they were further segregated into 3 categories which are
(i) A Category. (ii) B Category. (iii) C Category.

A Category: The mushrooms included in this category are properly weighed and their
color is also good. Mostly the oyster mushrooms with light brown colour are included in this
category and the size of the flower is 5-7 inches.

B Category: The mushrooms included in this category are smaller in size than the A
category mushrooms. But some full size mushrooms were also included in this category due
to their color. The color of such mushrooms didnt match the A category requirement and
thus they are included in this category.

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C Category: The mushrooms included in this category are spoiled or these include the
mushrooms that attain their maturity level. These mushrooms are broken sometimes from
centre and hence are included in this category.

19. Packing
Then these mushrooms were packed in the polythene bags. But separate these
mushrooms according to their categories and also packed them according to that. Fill the
plastic bags according to size of the mushrooms.

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20. Dispatch
Finally, the packed mushrooms were dispatched to our customers. We should use a
pickup van for our transportation method. All the orders were delivered to our customers
according to their needs.

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ORGANIZATIONAL STRUCTURE

Training
manager
Finance
manager
HR manager
General Manager
Marketing
manager
Care takers

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Finance manager
Mr.Jawad is our finance manager and he is responsible for maintaining all the finances of our
business like balance sheet and income statement, cash inflow, cash outflow etc.
Hr manager
Miss Sana is our HR manager and she is responsible for recruitment, selection and other
human resource activities.
Marketing manager
Mr. Sulman is our Marketing manager and he is responsible for taking orders and search out
the market for fresh mushrooms. Moreover, all the marketing activities for our promotion is
handled by him.
Training Manager
Mr. umair is our technical manager. He got all the knowledge relating to production and
growth methods and he should also train care takers in work.
Caretakers
They are responsible for
Take care of raw material
Look after the growth
Help in cutting

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TARGET MARKET

Basically we are focusing on the pizza parlors. So our major target market is the pizza
market or fast food market. In this regard, initially we are capturing only the Lahore market.
In Lahore city, we target all the fast food chain restaurants and pizza parlors. All these pizza
parlors are currently using the mushrooms in packed form. So we try to capture their attention
and force them to buy mushrooms from our company that is in fresh form. We focus them
because they are paying high cost for packed mushrooms and on the other hand we are
providing them mushrooms in fresh form which are very economical. So Lahore pizza and
fast food market is our basic target. After some time, we expand our operation to other larger
cities of Pakistan.

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MARKETING MIX

In this phase, we have developed marketing mix in which all the 4 Ps were consistent.
These 4 Ps easily adopt any market changes. These Ps are
1. Product.
2. Price.
3. Place.
4. Promotion.
PRODUCT
We are going to sell our product which is mushrooms. After cutting, the mushrooms are
ready for before delivery, we segregate them into three categories.
A Category: The mushrooms included in this category are properly weighted and their
color is also good. Mostly the oyster mushrooms with light brown colour are included in this
category and the size of the flower is 5-7 inches.

B Category: The mushrooms included in this category are smaller in size than the A
category mushrooms. But some full size mushrooms were also included in this category due
to their color. The color of such mushrooms didnt match the A category requirement and
thus they are included in this category.

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C Category: The mushrooms included in this category are spoiled or these include the
mushrooms that attain their maturity level. These mushrooms are broken sometimes from
centre and hence are included in this category.

PRICE
As we are the pioneer of fresh oyster so we are basically price setter in the market. But to
compete in market and to capture higher market share, we set our prices at a level that are
affordable by our customers. As the price of canned mushroom is very high, so to capture
market, we reduce our price. Canned mushrooms are available in market at price of 800-1200
per kilogram depending upon the quality. So we set our prices according to our product
categories.

CATEGORY PRICE PER KILOGRAM
A Category 500
B Category 350
C Category 250

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PLACE
Mushroom will be marketed locally through a free market system. As we know that
the main market of mushroom is pizza parlors, restaurants and shopping malls. But initially
we are targeting just the pizza parlors in our target market and the restaurant. This is because
the trend of fresh pan pizza is raising a lot. And customers we are targeting are used of dining
outside a lot. And in the next six months, we should also provide fresh mushrooms in big
shopping malls like Metro, Hyper Star.
PROMOTION
As we know that our customer is well aware of the taste of the mushrooms. To
introduce the nutritional aspect of mushroom, we use brochures for our promotion. Moreover,
we should also take part in food festivals to promote our product. As our target market is
Lahore pizza parlors, so we should also advertise locally using cable operators as our media
for advertisement.
But in future, we decide to launch cooking shows on MASALA TV to promote
mushrooms and our product at region or national level as we expand our business. The
cooking expert should cook dishes related to mushrooms and different pizza varieties.

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GAP ANALYSIS

Products

2005 (000 kg)

2010 (000 kg)

Supply

Demand

Gap

Supply

Demand

Gap

Fresh 300 1210 910 550 1875 1325
Canned 1200 1300 100 1750 1900 150

Analysis
In 2005 fresh oyster mushroom supply was 300 and demand was 1210 and in 2010
supply of fresh oyster mushroom is 550 and demand is 1875, the demand for fresh oyster
mushroom is increasing and it is producing only in the region of Karachi and Faisalabad but
its demand is increasing day by day.
In 2005 canned oyster mushroom supply was 1200 and demand was 1300 and in 2010
supply of canned oyster mushroom is 1750 and demand is 1900, the demand for canned
oyster mushroom is decreasing and it is producing in almost all big cities of Pakistan.

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COMPETITORS ANALYSIS

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DIRECT COMPETITORS

In Pakistani market, there is a big market of fast food items and it is growing day by day.
As the industry is growing, meanwhile its demand is also rising. So to fulfill this demand,
there are many companies in the market. So these are our direct competitors. But our target
market is Lahore and in Lahore there is no company that is providing fresh oyster
mushrooms. So we are pioneers in our market. Some companies are operating in Pakistan but
in other regions. Some of them are as follow

1. Kakar Trading Company.
2. Falcon Exports (pvt) Ltd.
3. Business Concepts (Pvt) Ltd.
4. PAK International Enterprises
5. A.T.M Industries Pvt Ltd.

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INDIRECT COMPETITORS
As our target market is Lahore market, there is no producer of fresh oyster mushroom. All the
pizza parlors are using dry or canned mushrooms for their pizza. As we are pioneer in our
field, but canned mushroom producer companies already have a brand name and brand
image. So they are also our competitors but indirectly.

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FINANCIALS

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INITIAL CAPITAL INVESTMEMT

Products Cost
Purchase of raw material
300000
Building rent 25000
Iron Shelves 30000
Supplies (office and operation) 10000
Cutting equipment 5000
Utilities 30000
Generator 120000
Humidity controller 10000
TOTAL 530000

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PROJECTED INCOME STATEMENTS
Particulars 2011 2012 2013
Sales 1440000 1800000 2400000
less: Cost of goods sold
Cotton Waste 44800 61600 80500
Spawn 24000 30000 37500
Plastic Bags 9600 12000 17500
Labor 224000 300000 375000
Total CGS 302400 403600 510500
Gross profit 1137600 1396400 1889500
Less: Operating expenses:
Administrative exp
Salaries
Electricity
Traveling

240000
120000
48000

264000
132000
50000

290400
144000
52000
Marketing exp
Advertisement
Telephone

120000
24000

100000
25000

100000
27000
Total Operating Expenses 552000 571000 613400
Earnings before income tax 585600 825400 1276100
Tax deduction: (5% on sales) 72000 90000 120000
Net income 513600 735400 1156100

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BALANCE SHEET FOR THE YEAR 2011
Particulars Debit (Rs.) Credit (Rs.)
Current Assets:
Cash 1000000
Inventory (F/G, Material) 56800
Total Current Assets 1056800

Fixed Assets:
Land & Building (25000/month rent) 300,000
Machinery (30,000) 27000
Less: accumulated depreciation (30,000 @
10%=3000)

Total Fixed Assets 327000
TOTAL ASSETS 1383800

Current Liabilities:
Estimated income tax 72000
Total current Liabilities 72000

Stockholders Equity:
Common stock 776600
Retained earnings 535200
Total stockholders equity 1311800
TOTAL LIABILITIES &
STOCKHOLDERS EQUITY
1383800

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BREAK EVEN POINT
=Total Fixed Cost/ (selling price per unit-variable cost per unit)
= 832800/ (500-5)
= 832800/495
= 1682 units
PAY BACK PERIOD
=Investment/Retained earnings
=1000000/535200
=1.87 years
=1 year, 10 months and 13 days

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MINUTES OF MEETINGS

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MINUTES OF MEETING
A Meeting was held with Dr. Muhammad Asif at his office dated on 10-03-2011, 13:00 Pm
regarding general know how about oyster and its feasibility in Pakistan. He is serving
Agriculture university faisalabad as professor for many years. He was the first person; who
start mushroom farming in Pakistan.
PARTICIPENTS:
Interviewers
-Mr. Sulman ashraf
-Miss Sana Khalid
-Mr. Umair shakeel
-Mr. Jawad bajwa
Interviewee
- Dr. Muhammad asif
We have discussed following issues regarding oyster mushroom farming.
His career in the oyster mushroom farming.
Brief introduction of the mushroom.
Discuss history and mushroom related Pakistani peoples perception.
Current practices about its oyster farming; demand and supply gap globally.
Physical feasibility of the mushroom in Pakistani environment.

Page 52


MINUTES OF MEETING
A Meeting was held with Mr. Asim at his office dated on 19-03-2011, 21:00 pm regarding
general know how about oyster and its feasibility in Pakistan. He is serving pizza hut Lahore
as manager.
PARTICIPENTS:
Interviewers
-Mr. Sulman Ashraf
-Miss Sana Khalid
-Mr. Umair Shakeel
-Mr. Jawad bajwa
Interviewee
- Mr. Asim
Mushroom demand.
Mushrooms impact on taste.
Supply chain regarding mushroom.

Page 53


MINUTES OF MEETING
A Meeting was held with Mr.Shehzad Aziz at his office dated on 20-03-2011, 11:00 Am
regarding general know how about oyster and its feasibility in Pakistan.
PARTICIPENTS:
Interviewers
-Mr. Sulman Ashraf
-Miss Sana Khalid
-Mr. Umair shakeel
-Mr. Jawad bajwa
Interviewee
- Mr.Shehzad Aziz
Growth mechanism of oyster mushroom.
Temperature requirement.
Atmosphere regulation regarding mushroom.

Page 54


MINUTES OF MEETING
A Meeting was held with Mr. Faisal Iqbal at his office dated on 22-03-2011, 16:00 Pm
regarding general know how about oyster and its feasibility in Pakistan. He is serving al-
minaal as general manager for many years.
PARTICIPENTS:
Interviewers
-Mr. Sulman Ashraf
-Miss Sana Khalid
-Mr. Umair shakeel
-Mr. Jawad bajwa
Interviewee
- Mr. Faisal Iqbal
Mushroom demand.

Page 55


MINUTES OF MEETING
A Meeting was held with Mr.Ali Aslam on call dated on 22-03-2011; 10:00 Am regarding
general know how about oyster and its feasibility in Pakistan. He is the owner of ATM
Company in Karachi.
PARTICIPENTS:
Interviewers
-Mr. Sulman Ashraf
-Miss Sana Khalid
-Mr. Umair shakeel
-Mr. Jawad bajwa
Interviewee
- Mr Raja Taimoor
Marketing opportunities of oyster mushroom.
Identify the gap between demand and supply of the mushroom.
Difference between fresh and canned mushroom market.

Page 56


MINUTES OF MEETING
A Meeting was held with Mr. Ali Zulfiqar at his office dated on 19-03-2011, 21:00 pm
regarding general know how about oyster and its feasibility in Pakistan. He is serving Ringo
pizza Lahore as manager.
PARTICIPENTS:
Interviewers
-Mr. Sulman Ashraf
-Miss Sana Khalid
-Mr. Umair Shakeel
-Mr. Jawad bajwa
Interviewee
- Mr. Ali Zulfiqar
Mushroom demand.

Page 57


BUSINESS CARDS

Page 58


PICTURES

Page 59


Page 60


REFERENCES

1. http://www.mushroombusiness.com/content/articles/detail/232/mushroom
-economics-in-china
2. http://findarticles.com/p/articles/mi_m0WDP/is_2001_April_23/ai_7359
7656/
3. http://www.iptu.co.uk/content/pakistan_clusters_food.asp
4. http://eng.hi138.com/?i273845_Mushroom_industrys_sustainable_develo
pment_approach
5. http://www.pakissan.com/english/advisory/export.fruits.economy.shtml
6. http://www.begellhouse.com/journals/708ae68d64b17c52,7c3e0ba845ba
8869,077af3c034cb7b70.html

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