24/11/2020

MINI BUSINESS PLAN

OGIJI VINCENT MONDAY RICE MILL

Prepared by: OGIJI MONDAY

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 vincentogiji97@gmail.com
 +234 806 522 3234

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Content

1. Business Description 2. Industry Overview

1. Personal Information 1. Sector Analysis
2. Business Details 2. Sub-sector Analysis
3. SWOT Analysis
4. Leadership Structure

3. Marketing and Sales 4. Financial Analysis

1. Competition 1. Key Assumptions
2. Advertising and Sales 2. Products and Services
3. Target Market 3. Financial Projections
4. Current Financing

5. Funding Requirement 6. Viability Summary

1. Proposed Loan 1. Profitability Ratios
2. Use of Funds 2. Viability Ratios
3. Weighted Average Gross Margin
4. Enterprise Value
5. Fund Repayment Ability

7. Conclusion
1. References
2. Photographs

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Business Description

Personal Information
Name: Other Name:
OGIJI MONDAY VINCENT

Gender: Email:
Male vincentogiji97@gmail.com

Contact: Government issued ID:

0806 522 3234 National Identification Number

Identification number: Address:

5298201301239475 11, MC KARTHY CRESCENT, WADATA, MAKURDI

Bank Verification Number:

22191620438

Educational qualification:

Institution name: Qualification: Course:

PAUL EPTON ACADEMY WAEC SECONDARY

Date awarded: Certificates proof:

8/27/2013 Yes

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Business Details
Name: Business age:
OGIJI VINCENT MONDAY RICE MILL 6 Years

Address:
11, MC KARTHY CRESCENT, WADATA, MAKURDI

Business description:
For years, rice has been one of the most sought after staple foods in Nigeria. Throughout this period, the rate
of consumption of rice in the country far exceeds that of production, necessitating the need for importation in
the past. With a population of over 180,000,000 people in Nigeria, the country became the leading importer
of parboiled rice. At a point, over 50% of the rice consumed in the country was imported. The large gap in
parboiled rice production in the country was made vivid after

USP: Our Products/Services

1. Will be of superior quality
2. Will offer more choice to the customers
3. Will be priced lower than the market price

SWOT Analysis
Strengths Weaknesses

STRONG TECHNICAL KNOW HOW OF THE

INADEQUATE FUNDS
BUSINESS

KNOWLEDGABLE AND DEDICATED STAFF INADEQUATE FACILITIES FOR PRODUCTION

INCREASING DEMAND FOR OUR PRODUCT LOW FINANCIAL CAPACITY

Opportunities Threats

FAVOURABL POLICY ON AGRICULTURAL FUNDING INCREASING COST OF RAW MATERIALS

POTENTIAL FOR HIGH PROFITABILITY EPILEPTIC POWER SUPPLY

QUALITY ASSURANCE OF OUR PRODUCT ECONOMIC DOWNTURN

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Leadership Structure
Details of owners of the business

# Name Shareholding in %

1 OGIJI VINCENT MONDAY 100

100.00%
100.00%

OGI J I V I NCE NT MONDAY

Details of managers of the business

# Name Area of Responsibility

1 OGIJI VINCENT MONDAY

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Industry Overview

Sub-Sector Analysis - Rice Milling

Five forces

Bargaining Bargaining
Power of Power of
Customers Suppliers
LOW
5 MEDIUM

FORCES
Industry Threat of
Rivalry Substitution
MEDIUM MEDIUM
Threat of New
Entrant
MEDIUM

General
Milling is a crucial step in the post-production of rice. It includes activities / operations such as parboiling,

cleaning, dehusking and polishing amongst others, that are geared towards producing better quality and

higher yield of white rice for consumption. Rice is one of the leading food crops in the world and the most

consumed staple food in Nigeria. Nigeria is among the top 15 producers of rice globally and the largest

producer in Africa, with an annual production of 7.6 million tons. There are many varieties of rice grown in

Nigeria such as paddy rice, brown rice and 'ofada rice'. Paddy rice, also known as rough rice, is the most

popular variety milled in Nigeria. About 90% of Nigeria’s rice is produced by small scale farmers, while the

remaining 10% is produced by corporate / commercial farmers. Rice is mainly cultivated in the Northern

region of Nigeria such as Niger, Kogi, and Kebbi states

Trends
Nigeria imports about 2.2 million metric tons of rice annually. Imports largely comprises of parboiled rice (also

known as converted rice and easy cook rice). The Federal Government is encouraging local businesses in the

industry by implementing trade policies that promote increased domestic production and self-sufficiency in

rice production. The industry is dominated by a few large scale processing companies such as Dangote Rice

Mill, Quarra Rice Mill, Olam Nigeria, and Onyx Rice Mill, who grow their produce for processing

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Demand
The demand for rice is high in Nigeria with an annual consumption volume estimated at 7.2 million tons. Rice

is the most important crop that is used as a primary food source. Its high demand is sustained by the

increasing national population, increasing income levels and rapid urbanization. The by-products of rice is

also demanded by the manufacturing and food industries and serves as a raw material for animal feeds

Regulatory considerations
Operations in rice milling must conform to the regulations of the National Export Promotion Council (NEPC),

National Agency for Food and Drug Administration and Control (NAFDAC), Standard Organization of Nigeria

(SON), Corporate Affairs Commission (CAC) and Grain Sellers Association

Risks
A major risk in the rice milling business pertains to product quality. Pest infestation due to insects, rodents,

and birds affect the quality of rice during pre and post harvesting. Poor technical performance of milling

machinery, or operator ineptitude also result in low quality yields. To ensure greater yields, best pest control

measures and efficient maintenance of machinery should be adopted

* So u rces: USDA G rain R ep o rt 2 0 1 9 ; Pu n ch 2 0 1 7

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Marketing And Sales

Competition
Key competitors:

Price of the
Name of Name of individual’s/ Price of Region of LGA of Difference
# Products Competing Competitor company’s Competitor Competitor Competitor from your
Product Organization product/ product ( ₦ ) Operations Operations product
service( ₦ )

GOOD
OTHER
PROCE QUALITY
BAGS OF RICE
1 SSED 25,000 30,000 Benue Makurdi AND
RICE PROCESS
RICE AFFORD
ORS
ABLE

Advertising And Sales

Our Advertisment:
1. Radio
2. Billboards
3. Mobile marketing
4. Social media

Sales Strategy:
1. Direct sales and marketing by you or your employees
2. Direct online sales with delivery
3. Direct sales through your own outlets
4. Indirect sales through distributors, agents, or other shops

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Target Market
Target Customers: Individuals

All All


Gender Age Category

5,890,882 100%
Customer population by location Customer proportion by age group

Target Location
States: Benue LGA: State-Wide

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Financial Analysis

Key Assumptions
Assets:

Machinery & Equipment

Purchase price ( ₦ ): 450,000
Year of accuistion: 2015
Lifespan (years): 13

Products And Services

Product list:

Product Production Selling Wholesale price of Retail price of

# name quantity quantity product ( ₦ ) product ( ₦ )

BAGS OF
1 2,000 Units 1,950 Units 24,000 26,000
RICE

Frequency of increase in Product/Service price: Selling Price Growth Rate:

Annually Inflation rate

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Financial Projections
Projected profit ( ₦ ):
1000M

873M
873M

750M

581M
581M 559M
559M

500M
387M
387M 372M
372M
₦) ( t n uo mA

257M
257M 247M
247M
250M
171M
171M 165M
165M
114M
114M
76M
76M
50M
50M

0
-1 9 M
-19M -2 8 M
-28M -4 2 M
-42M
-6 2 M
-62M
-9 3 M
-93M
-1 4 0 M
-140M
-250M -2 1 0 M
-210M

-3 1 5 M
-315M

-500M
Year 1 Year 2 Year 3 Year 4 Year 5 y ear 6 y ear 7 7

Net R evenue Cost of r evenue Gr oss pr ofit

Projected operating expenses ( ₦ ):

6M

5M
5M
5M
5M
4M
4M
5M
4M
4M
4M
4M
4M
4M
4M
4M 2M
3M
3M 2M
4M
2M
2M
2M
₦) - ( s es n epx E

1M
1M
3M 1M

1M
1M
1M
2M 1M
1M
1M
1M
960k

540k 578k
471k 504k
412k 441k
1000k 360k 385k

573k 590k
540k 556k
494k 509k 524k
480k

428k 454k 481k 510k 541k

360k 381k 404k
0
Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8

S alar ies Gener al and Administr ation Utility costs R ent Other s

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Financial indicators ( ₦ ):

# S t a t e me nt Ye a r 1 Ye a r 2 Ye a r 3 Ye a r 4 Ye a r 5 Ye a r 6 Ye a r 7 Ye a r 8

1 EBI TDA ( Gr oss P r ofit - Ope r a tin g Expe n se s) 28,488,000 44,591,640 68,859,462 105,392,818 160,351,627 242,987,531 367,195,559

2 DEP REC I ATI ON -6 3 4 , 9 4 8 -6 3 4 , 9 4 8 -6 3 4 , 9 4 8 -6 3 4 , 9 4 8 -6 3 4 , 9 4 8 -6 3 4 , 9 4 8 -6 3 4 , 9 4 8

3 EBI T 27,853,052 43,956,692 68,224,514 104,757,870 159,716,679 242,352,583 366,560,611

4 I N TERES T I N C OME / ( EXP EN S E) -8 9 9 , 9 6 4 -8 5 6 , 3 6 9 -7 5 5 , 5 9 5 -6 4 5 , 3 7 2 -5 2 4 , 8 0 6 -3 9 2 , 9 3 3 -2 4 8 , 6 8 7

5 N ET EA RN I N GS BEFORE TA XES 26,953,088 43,100,323 67,468,919 104,112,498 159,191,873 241,959,650 366,311,924

6 TA XES -5 , 3 9 0 , 6 1 8 -8 , 6 2 0 , 0 6 5 -2 0 , 2 4 0 , 6 7 6 -3 1 , 2 3 3 , 7 4 9 -4 7 , 7 5 7 , 5 6 2 -7 2 , 5 8 7 , 8 9 5 -1 0 9 , 8 9 3 , 5 7 7

7 N E T E ARN I N GS 21,562,470 34,480,258 47,228,243 72,878,749 111,434,311 169,371,755 256,418,347

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Balance Sheet ( ₦ ):
1200M

1107M
1107M

1000M

800M
720M
720M
₦) ( t n uo mA

600M
1107M

464M
464M

400M
720M
295M
295M

464M
200M 184M
184M

112M
112M 295M

66M
66M 184M
32M
32M 112M
32M 66M 7M 6M 6M 6M 6M
0
Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8

Assets E quity Liabilities

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 Cashflows Statement:

Operations ( ₦ ): Financing Activities ( ₦ ):

1200M 12M

1082M
1082M
10M
10M
10M
1000M

8M

800M
6M
₦ ) - ( s es n epx E

) ( t n uo mA
10M

₦
600M 4M

1082M

2M
400M 380M
380M

0
0
251M
251M
-2M -2M -2M -2M -2M -2M -2M
200M 166M
166M 380M -2 M
-2M -2 M
-2M -2 M
-2M -2 M
-2M -2 M
-2M -2 M
-2M
109M
109M -2M -2 M
-2M
251M
71M
71M
34M 4
34M 46M
6M
109M
20M
20M
46M
0 -4M
la

la
1

8
to

to
ra

ra

ra

ra

ra

ra

ra

ra

ra

ra

ra

ra

ra
ae

T
eY

eY

eY

eY

eY

eY

eY

eY

eY

eY

eY

eY

eY
Y

Oper ations Financing Activities

Investing Activities ( ₦ ): Net Cash Change ( ₦ ):

0 1200M
0 0 0 0 0 0 0

1075M
1075M
-1000k
1000M

-2M

800M
-3M
) ( t n uo mA

) ( t n uo mA

-7M -7M
₦

-4M 600M

1075M

-5M
400M 378M
378M

-6M
250M
250M

200M 165M
165M 378M
-7M 108M
108M
-7 M
-7M -7 M
-7M 250M
70M
70M
33M 4
2 3 M 33M
23M
45M
5M
108M
45M
-8M 0
la

la
1

8
to

to
ra

ra

ra

ra

ra

ra

ra

ra

ra

ra

ra

ra

ra

ra
T

T
eY

eY

eY

eY

eY

eY

eY

eY

eY

eY

eY

eY

eY

eY

I nvesting Activities Net Cash Change

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Funding Requirement

Proposed Loan
Loan required: Loan duration:

₦ 10,000,000 7 Years
Purpose:

Expand an existing business

Loan start year:

2020

Loan Repayment
Repayment mode:

Monthly instalment payments

Loan moratorium:

Yes, for one year

Use of Funds
Funds Allocation

# Use % Allocation

1 Purchase machinery / equipment 70

2 Fund working capital / operations 30

New Machinery/Equipment

# Name Use of equipment No. of units Lifespan Unit cost Total

1 RICE MILLER MILLING 1 15 1,700,000 1,700,000

2 PARBOILER PARBOILING 1 12 1,680,000 1,680,000

3 RICE DESTONER DESTONING 1 10 880,000 880,000

4 POLISHER POLISHING 1 10 740,000 740,000

5 GRADER GRADING 1 10 1,450,000 1,450,000

6 PACKAGING MACHINE PACKAGING 1 10 100,000 100,000

7 DRUMS CONTAINERS 30 15 15,000 450,000

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Working Capital

# Item Description/Purpose Unit cost Quantity Total Cost

1 RICE PADDY RAW MATERIALS 2,570,000 1 2,570,000

2 FIREWOOD SOURCE OF FUEL 70,000 1 70,000

3 LABOUR LABOUR 180,000 2 360,000

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Viability Summary

Profitability Ratios

Ye a r 1 Ye a r 2 Ye a r 3 Ye a r 4 Ye a r 5 Ye a r 6 Ye a r 7 Ye a r 8

Gr oss P r ofit % 64.00% 64.00% 64.00% 64.00% 64.00% 64.00% 64.00% 64.00%

EBI TDA ( Gr oss P r ofit - Ope r a tin g Expe n se s) 28,488,000 44,591,640 68,859,462 105,392,818 160,351,627 242,987,531 367,195,559 553,844,549

Viability Ratios

Values Decision

Internal Rate of Return (IRR) 100% Positive

Net Present Value (NPV) 4,578,193,871.69 Positive

Weighted Average Gross Margin : 64.00 %

Enterprise Value : ₦ 4,586,874,844.59

Fund Repayment Ability

Ye a r 0 Ye a r 1 Ye a r 2 Ye a r 3 Ye a r 4 Ye a r 5 Ye a r 6 Ye a r 7

De bt S e r vic e C ove r a ge ( DS C R) 31.65 23.10 35.67 54.59 83.06 125.86 190.19 286.87

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Conclusion

References

No Full Name Contact Address

1 ALECHENU SUNDAY 08063660985 MONATEL HOTEL, ATOM KPERA ROAD, MAKURDI

2 OGIJI SAMUEL IKWUTA 08069542046 11, MC KARTHY CRESCENT, WADATA, MAKURDI

Photographs

Photograph of business owner

Photograph of business
operations

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Connect With Us
OGIJI VINCENT MONDAY RICE MILL

11, MC KARTHY CRESCENT, WADATA,

MAKURDI

 vincentogiji97@gmail.com
 +234 806 522 3234

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