AFRI FARM

BUSINESS PLAN FOR

POULTRY FARMING

8/23/2020

AUTHOR

Humphrey Mwiinga

Email: afrifarm87@gmail.com

Website : https://afriefarm.com/
TABLE OF CONTENTS
EXECUTIVE SUMMARY
Poultry farm Objectives
Poultry farm Mission
key to success
INDUSTRY ANALYSIS
Challenges facing the poultry industry
START-UP SUMMARY
Poultry farm startup costs for 100 Birds
POULTRY FARM PRODUCTS
Product description
PRODUCTION SUMMARY
Production plan
MARKET ANALYSIS SUMMARY
Market segmentation
Target market segment strategy
Competition
Marketing strategy
Pricing and Promotion strategy
Web strategy
Sales strategy
MANAGEMENT SUMMARY
Management team
INTERNAL ENVIRONMENTAL ANALYSIS
SWOT ANALYSIS
Strength
Weakness
Opportunities
Threats
EXTERNAL ENVIRONMENTAL ANALYSIS
FINANCIAL PLAN
Records management
RISK ASSESSMENT
Financial risks
Health risks
Technological risks
Contingency plans

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 EXECUTIVE SUMMARY

Afri farm is a farm focused on both egg and meat production that provides for a large market
range. It also produces manure as a by-product. It is based in Monze, Southern Province. The
founders have noticed the health implication of red meat and are creating a business to meet
the increased demand for white meat and eggs. Chickens happen to be a great source of white
meat and are also largely known for egg production..

Not only are the founders interested in meeting the demands of the customer, we also plan to
create utmost satisfaction for these customers. The founders also want to use this business as a
means of creating employment within the community it is based in and to contribute to the
economy of the country. We plan on provide products with quality and maintain this supply
efficiently. This is a business that plans on distributing eggs and chicken to restaurants, home
delivery food centers, hotels, schools, clubs, bakery and catering businesses and supermarkets.
We also plan on doing this at very affordable prices. We will also distribute manure to farmers
that are into crop production.

This business plan is meant to articulate the vision and future of our poultry, and to appeal to
investors and external stakeholders to get involved in this business and help with its funding as
it is a capital intensive business. We also hope that it will serve as a guideline for the firm’s
employees to move towards the goal of the poultry.

Not only do we offer products, but we offer services as well. We plan on providing home
delivery services to customers who order a certain amount of products. This offer will mostly be
used by the section of our target market that uses eggs in large quantities like schools and
bakeries.

1000 chickens would be optimum for the initial operation of the business. Plenty open space,
cheap labors, road connection, water availability and immediate access to markets.

Revenue for this will be gotten from contributions from partner contribution. Investment in
this business shall be allocated to the following purposes: buying chickens, building cage house,
stocking the pellets, hiring the experts and other miscellaneous tasks. Fifty percent gross
margin is expected within 6 months of its operations withholding the chances of any accidental
or unexpected incidence and we hope to obtain the breakeven point within 2 years.

We have considered the risks, financial, health and technology wisely

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Poultry farm Objectives

The poultry will measure its success by its ability to achieve the following objectives:

 Becoming the "Best and most hygienic poultry producer in the area" complying by the
national standards for food and drugs.
 Turn in profits from the first six months of operations.
 Maintain 50% gross margin ratio.
 Winning the hearts and tastes of our beloved consumers and establishing a brand image
of the company through heavy marketing campaigns in the first one year.

Poultry farm Mission

The poultry’s mission is to provide customers with quality, fresh, and valuable products. To
respect all employees and enable everyone to have a say in company affairs. Quality and
service are our number one priority. To provide investors with opportunities to receive a nice
return on investment and high-quality growth. To contribute to the community through
physical and social programs. The poultry farm intends to have the largest poultry farm
products. We plan to increase and expand our production of chicken to challenge the ever
growing demand for chicken products. The nutritious and protein rich products from our farm
would always be the first choice of our consumers.

keys to success

The poultry will follow these principles in order to achieve success in its market:

 State of art cage framework accommodating optimum number of chickens with

lessened possible hazards.
 Diverse slaughters network, market chain management, optimum inventory level and
‘customer is king’ policy.
 Regular visits by veterinary medical workers and hygienic poultry house environment.

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INDUSTRY ANALYSIS

Poultry industry in the last 40 years has shown dramatic changes in both domestics and
international environments. Those environmental forces include are classified into 2 categories:
the internal forces and external forces. Internal and external forces include:

1. Poultry industry competitors: When the company have few competitors, it is more likely to
get more profit. Competition is today driven by a cost of manufacturing and the quality of
products sold to the customers.

2. Supplier dynamics: Suppliers of raw materials to the poultry companies are the ones the
affect the costs of poultry products. If there is development of new market and technology, the
price of raw materials will remain low.

3. Opportunities: There are many opportunities in poultry industry. The first opportunity is that
there is small number of large scale poultry farmers, and the other ones are small scale
business farmers. So this will make businessmen to vertically integrate in the poultry business.

4. Cultural and religious forces: As we know, the presence of taboos can be a hindrance in the
development of poultry farming. However in Society there are very few, maybe none, laws or
cultures that prohibit eating poultry products. This is a good opportunity for businessmen to
develop and expand their poultry farm with in the country without any challenge.

Challenges facing the poultry industry

Poultry farming has some challenges that need to be attended to with vigor. Below are some of
the common challenges that are faced by poultry farmers:

Death of chickens: In poultry, one or many chickens usually die because of their fragile nature
and the weather they are living in. Some factors such as heat and overcrowding causing that
death can be controllable.

Diseases: Pneumonia and other minor diseases are among problems faced by poultry farmers,
but this problem can be solved by seeking a veterinary doctor.

START-UP SUMMARY

Our business has startup cost and we will need a bank account, This section of the plan shows
projected startup costs prior to opening.

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Start-up expenses for the poultry farming include pre-launch marketing to cover flyers, a direct
mail campaign, and advertisements in local papers, the development of a website for customer
interaction, and the normal legal expenses for consultation and permitting.

Poultry farm startup costs for 100 Birds

Item Cost
Drinkers x 6 K480
Feeders x 6 K360
Lighting system K80
Chicks x 100 K700
Starter x 2bags K620
Grower x 3 bags K915
Finisher x 4 K1,200
Saw Dust x 30 bags K540
Vaccines K100
Medicines K150
Vitamins K150
TOTAL K5,295

POULTRY FARM PRODUCTS

Product description

We offer chicken eggs and chicken meat that will be gotten from layers and broilers to our
target market. We plan to take pride in the uncompromising quality of our products. We also
offer fertilizer in form of chicken manure. This is mostly used in vegetable farming and as an
ingredient for feed in fish farming. The poultry shall produce high quality, contaminant-free
chickens and the freshest eggs to satisfy the taste of our beloved costumers. The products shall
be distributed into a number of distributors - supermarkets, public markets, bakeries,
restaurants and in the company’s own retail space for easy access for marketing agents and
consumers. In brief our products are;

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  Main products
a) Eggs
b) Live chickens
 By-products
a) Chicken droppings

Future products

We have big plans for the future. We plan on supplying cracked egg shells for some detergent
companies for use. These special detergents are used in washing basins and pots. Another thing
we have planned for the future is the sale of processed chicken meat.

Service Description

We plan on servicing our customers by providing home delivery for customers who are willing
to buy at least a certain amount of our products.

Future services

In the future, we plan on creating a restaurant that has eggs as its main menu. It will be like a
breakfast restaurant. In the future, if this business gets large enough, we would also like to
build our own bakery. A major ingredient in most baked goods is eggs and we will be funding
that through the poultry.

PRODUCTION SUMMARY

Production plan

In our poultry, we are planning to start with 100 chickens for meat, and 100 chickens for eggs.
For 100 chickens for eggs, each chicken is expected to lay at least 1 egg per day. For the whole
day, 100 eggs will be produced. For every 3 months, 100 adult chickens will be sold. Our
production target is to reduce cost of production by at least 20% in the next 3 years.

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MARKET ANALYSIS SUMMARY

Market segmentation

Although in the populace, there are a few taboos, religious or cultural practices that will
prevent the consumption of poultry produce, during the market segmentation, we found out
that nearly everybody eats eggs and meat, so we are targeting the whole market, individuals,
homes and firms that use eggs and chicken in large quantities. Specifically there is a high
demand for live chickens for home consumption or as gifts during festivals like Christmas, New
Year, Easter etc.

Hotels and restaurants

Bakeries and food joints
Retail shops
Homes
Individuals
Others

Target market segment strategy

Individuals are a small sector in the market segmentation. They are a pretty large group but
they buy a relatively small amount of eggs.

The part of the market that we hope to supply large amount of eggs to are the industries that
need eggs. We have strategically placed our site close to these industries. They are bakeries,
restaurants, boarding schools, home delivery food centers, retail shops and supermarkets.

Another part of our target market that will order our products in medium quantities are the
homes that will require our home delivery as we have a set amount of eggs they need to order

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for. Homes generally utilize eggs in the preparation of edibles like chicken burger, chicken pie,
salads, Scotch egg, omelets, egg soup etc.

The parts of our target market interested in live chickens are small scale poultry farmers and
festive individuals. We have considered the needs of each section of the target markets and we
plan on meeting these needs effectively.

Competition

Competition is not so keen in the markets, however it still exists. The reasons are;

 Poultry products are not branded products; hence what usually matters is effective
positioning and timing.
 Poultry market is not crowded, it’s a seller’s market.
 Most poultry produce are sold through informal channels. Competition is usually found
within local products and imported ones.

However, this is an increasing business in terms of number of people who are doing it. This is
because some countries are still importing chicken products like eggs from other country. Our
competitors include those who sell meat and fish. The demand is high for live birds and eggs
either for consumption or for gift in the time of Christmas, New Year, Easter, etc. The products
of poultry are also needed in fast food business which engages in the sale of products like
chicken, eggs, etc. After having a look and analyzing this scenario we decided to come in this
industry to solve problem of malnutrition in our population. Therefore, to achieve a
breakthrough in our business we will be using our motto “customer is the king.” This means
that everything we will be doing is basically to satisfy the needs of our customers.

Marketing strategy

The poultry will strive for the production of products with the highest quality and we plan on
employing the following strategies. Our location puts us in proximity of a major hotel,
restaurant, schools with campuses and home deliver food centers we will be supplying to. We
would also make contracts with hawkers in markets to sell our live chickens and eggs. We
would also make contracts with retail shops for constant supply of eggs at intervals.

Pricing and Promotion strategy

The price of the chicken would range from K55 up to K60 depending on the size and quality.
Also, the price for a tray of eggs ranges from K36 to K42. The price of a wheelbarrow of manure
costs about K30. These prices would also vary depending on the existing market price of poultry

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meat and eggs. As we compete with other poultries, we will promote our products through
advertisements with the aid of streamers and pamphlets. We can also make our business
known through recommendations and connections with well-known businessmen in the
locality. We will also make our products and service known in the newspapers. We have
created a website too to let the consumers know of our business.

Web strategy

The poultry also has a website where customers can interact with us and get a feel of what the
business is about. We know a site or two where we can place online advertisements and we
would also make mentions of our poultry in online newspapers.

Sales strategy

 Better farm management practices

 Regular visit by veterinary doctors
 Recycling wastes as fertilizer
 “consumer is king” policy
 Keeping up with new technology for production efficiency

MANAGEMENT SUMMARY

Management team

The management team is simply the partners in this business.

INTERNAL ENVIRONMENTAL ANALYSIS

SWOT ANALYSIS

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SWOT stands for strength, weakness, opportunities and threats and we have made an analysis
in each case.

Strength

 Produce high quality eggs enriched with protein

 Relatively good infrastructure systems
 Good marketing system
 Eggs and chicken are not seasonal products and can be eaten any time of the year
 In this area, the poultry business hasn’t been over-exploited
 Poultry are environmentally friendly

Weakness

 Capital intensive. Starting a layer poultry business requires a large capital funding.
 Outbreak of disease can ruin entire business in a go
 The smell can be quite disturbing

Opportunities

 Expansion into large scale production of by products(fertilizer and detergent)

 Export to neighboring towns
 A large and successful poultry will ensure food security

Threats

 More competition
 Avian diseases
 High feed ingredients prices
 Threat of import of frozen chicken

EXTERNAL ENVIRONMENTAL ANALYSIS

Socio-cultural – Eating habits of our consumers will definitely affect our business. Also, the
success of restaurants and other firms that order our products will indirectly affect our
business.

Technological - A good technical infrastructure would lead to better production and hence
lower costs. Technology will also mean more effective business marketing.

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Economic – economic trends such as demand and supply will determine the sustenance and
profitability of the business. Also inflation rates will affect the way we pay our employees and
the price of the product.

Political – this will include government policies concerning inspection by the ministry of health
and organizations like NAFDAC.

FINANCIAL PLAN

In every project found. We have to pass through the financed process. This have to do with the
starting of business, whether the personal income used or term loans from banks. In our
business, the financing structure and ways of doing it is like the path below.

1) Equity contribution: this cover the land we are using for the poultry, and also the facilities in
the building. The total income will be store rooms, office and constructions as well as the
furnishing part.

2) Personal income or member contributions, will be used to start-up the operations, the
hatchery equipment and other equipment’s needed for the poultry.

Since for a part up business borrowing money from a bank is not advisable for our financing
project. Financing by loan becomes our secondary motive if we can get enough income for the
start up business. When we borrow and use personal income, it is easier to obtain and quicker
than loan. The tax rate is low.

Records management

As to records management, each project will have a record book on which information on the
number of stocked live birds, slaughtered and deaths are recorded. Record keeping will help to
budget accurately and make informed decisions about the poultry. The records will contain
information such as

 All feeds consumed and purchased

 Number of hens purchased
 Deaths and causes
 Vaccination and other veterinary requisites expenses
 Labor and other variable costs
 Number of eggs collected daily
 Number of eggs sold and used for home consumption
 Number of eggs damaged and
 Water and feed intake daily.

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RISK ASSESSMENT

Financial risks

 Changes in our pricing policies or that of our competitors

 Fluctuation in revenue from distributors and retailers
 Timing of costs related to acquisitions or payments

Health risks

Contagious disease and virus outbreak is very deadly; if one of the chickens should catch the
disease, all of them will be affected and if it's not recognized and treated early it will lead to the
death of all the chickens which is a great loss for the business. And also some of the diseases
are also contagious to human not just between the chickens which will affect the workers and
also those that eat it.

Disease prevalence varies from one area to the other. The problems that may trigger disease
conditions are direct sunlight on egg trays or nests, poor ventilated houses and very high
temperatures in and outside the poultry house, which may weaken egg shells resulting in poor
egg quality. All these conditions will be avoided to the best of our abilities.

Another thing we considered during the risk assessment is the mortality of the chickens which
is inevitable since we are dealing with living things. This can be managed with good
management and has been calculated to range between 5-10%.

Technological risks

Technology is good but they also have their disadvantages. There are normally problems
involved in using technology; the use of the machine that collects eggs may fail to work or spoil,
making the work slow and adding more cost to the business by repairing it. The cost for
electricity is also not easy and some electric problems can lead to fire outrage and burn the
building causing the loss of assets and perhaps the entire business.

Contingency plans

As we considered these risks we have also made contingency plans for unprecedented events
or occurrences. As per the health risks, we will have plans with a veterinary doctor that will
have regular checkups with the chickens while giving them the best environmental conditions.
Another contingency plan we will make is insurance that will protect our assets. One of the risks
we have to face mentioned earlier, the occurrence of a fire outrage will be curbed by placing
fire extinguishers at strategic places. And in case of financial crises, we may have to resort to
getting loans.

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