THE FEDRAL POLYTECHINIC ADO-EKEITI, EKITI STATE.

ENTREPRENEURSHIP (SKILL ACQUISITION)

COURSE CODE :414

UNIT: AQUACULTURE

QUESTION: PICKING ANY VALUE CHAIN IN ACQUACULTURE WRITE IN

DETAIL OF A BUSINESS PLAN STATING WHY THAT BUSINESS PROFITABLE

SUBMITTED BY

NAME: OJO IYANU GRACE

MATRIC NUMBER :FPA/BF/21/3-0041

BUSINESS PLAN STATING

ON

GRACE FEEDPRODUCTION: PROVIDING SUSTAINABLE AND

AFFORDABLE FISH FEED FOR NIGERIA'S GROWING AQUACULTURE

INDUSTRY

SERIAL NUMBER: 002

APRIL 2023
EXECUTIVE SUMMARY

grace feedproduction is a nigerian-based company that specializes in the production and

distribution of high-quality fish feed for the aquaculture industry. our mission is to provide

affordable and nutritious feed to fish farmers across the country, and to contribute to the

development of a sustainable and profitable aquaculture sector in nigeria.

the aquaculture industry in nigeria is growing rapidly, driven by increasing demand for fish

products and a growing awareness of the health benefits of consuming fish. however, one of the

main challenges faced by fish farmers is the availability and affordability of quality feed. this is

where grace feedproduction comes in. we aim to bridge the gap between supply and demand by

producing and distributing high-quality fish feed at affordable prices.

our feed is made from locally-sourced ingredients, ensuring that it is both cost-effective and

sustainable. we use state-of-the-art technology and employ a team of experienced professionals

to ensure that our feed meets the highest standards of quality and nutrition. we have also

established partnerships with key players in the aquaculture industry to ensure that our feed is

distributed efficiently and reaches farmers in all parts of the country.

our business model is based on a direct-to-farmer approach, which allows us to reduce

distribution costs and pass on the savings to our customers. we also offer technical support and

training to our customers, helping them to optimize their fish farming operations and increase

their profitability.

in terms of financial projections, we expect to break even within the first year of operation and to

generate significant profits by the third year. our revenue model is based on a combination of

feed sales and value-added services, such as training and technical support.
we are seeking a total investment of n50 million to fund the establishment of our production

facility and to cover operating expenses for the first year. in return, we are offering equity shares

to investors, with the potential for significant returns on investment.

in summary, grace feedproduction is a promising investment opportunity in a growing market.

with a proven business model, a team of experienced professionals, and a commitment to

sustainability and quality, we are well-positioned to become a leading player in the nigerian

aquaculture industry.

COMPANY DESCRIPTION

Grace Feedproduction is a Nigerian-based company that specializes in the production of high-

quality feed for aquaculture. Our feed products are specifically formulated to meet the nutritional

needs of various species of fish and crustaceans, and are designed to promote healthy growth and

maximum yield.

Our team of experts has extensive experience in aquaculture and feed production, and we are

committed to using the latest technologies and scientific research to develop innovative and

sustainable feed solutions. We operate a state-of-the-art feed mill that is equipped with the latest

processing and packaging equipment, and our quality control processes are designed to ensure

that our products meet the highest standards of quality and safety.

At Grace Feedproduction, we are committed to promoting the growth and development of the

Nigerian aquaculture industry. We believe that by providing high-quality feed products, we can
help local fish farmers and aquaculture operators to improve their yields and profitability, and

contribute to the economic growth of our country.

MARKET ANALYSIS:

The aquaculture industry is a rapidly growing sector, driven by increasing demand for seafood

products and a growing awareness of the health benefits of consuming fish. According to a report

by the Food and Agriculture Organization (FAO), global aquaculture production has increased

by an average of 5.8% per year over the past decade, reaching 114.5 million tons in 2018. This

growth is expected to continue in the coming years, driven by factors such as population growth,

rising incomes, and changing dietary habits.

The demand for high-quality feeds is essential to the growth of the aquaculture industry. Grace

Feedproduction intends to fill the gap by providing customized feeds that meet the specific

nutritional needs of different species of fish and other aquatic animals.

The aquaculture industry in Nigeria is growing rapidly, with increasing demand for fish and

seafood products. As the industry continues to expand, the demand for high-quality feed

products is also increasing. The market for aquaculture feed in Nigeria is estimated to be worth

several billion Naira, with significant potential for growth in the coming years.

The major players in the Nigerian aquaculture feed market are currently foreign companies, with

limited participation from local companies. However, there is a growing interest in developing

the local industry, with the government providing support for the development of local feed

production. This presents an opportunity for Grace Feedproduction to enter the market and

compete with established players.

In terms of the target market, Grace Feedproduction will focus on supplying feed products to

small and medium-sized fish farms in Nigeria. These farms represent the majority of aquaculture

production in the country and are currently underserved by the major feed producers. By

providing high-quality feed products at competitive prices, Grace Feedproduction will be able to

capture a significant share of this market.

In addition, Grace Feedproduction will also target the export market, particularly in West Africa.

The growing demand for seafood products in the region presents an opportunity for the company

to expand its customer base and increase revenue.

Overall, the aquaculture feed market in Nigeria presents a significant opportunity for Grace

Feedproduction to establish itself as a leading player in the industry. By focusing on the

underserved small and medium-sized fish farms and providing high-quality feed products at

competitive prices, the company can capture a significant share of the market and achieve

sustainable growth in the years ahead.

MARKET STRATEGIES:

1. Pricing Strategy: Our pricing strategy will be to offer competitive prices that are in line with

the current market rates. We will regularly monitor the prices of our competitors and adjust our

prices accordingly to remain competitive. We will also offer discounts and promotions to attract

new customers and retain existing ones.

2. Distribution Strategy: We will employ a multi-channel distribution strategy to reach our target

customers. This will involve distributing our products through various channels, including
wholesalers, retailers, and direct sales to farms. We will also explore e-commerce platforms to

reach customers beyond our physical distribution network.

3. Promotion Strategy: We will use a mix of traditional and digital marketing channels to

promote our feed products. We will leverage social media platforms, such as Facebook, Twitter,

and Instagram, to engage with our target audience and build brand awareness. We will also

attend trade shows and industry events to showcase our products and build relationships with

potential customers.

4. Product Strategy: We will focus on producing high-quality and nutritious feed products that

meet the specific nutritional requirements of different fish species. We will also explore the use

of alternative feed ingredients, such as insects and microalgae, to reduce production costs and

minimize the environmental impact of our feed production.

5. Partnership Strategy: We will seek strategic partnerships with aquaculture farmers, industry

associations, and other stakeholders to enhance our market reach and build strong relationships

in the industry. We will collaborate with research institutions and universities to develop new

and innovative feed products that meet the evolving needs of the aquaculture industry.

PRODUCTS AND SERVICES:

Grace Feedproduction offers a range of specialized feeds for various species of fish and other

aquatic animals. Our products are designed to provide optimal nutrition, growth, and health,

while minimizing environmental impact. Our feeds are made from locally sourced, sustainable

ingredients, and formulated using the latest nutritional research.

We offer a range of high-quality aquaculture feed products for different fish species. Our

products will be formulated to meet the nutritional requirements of each species and to optimize
growth and health. We will also offer customized feed formulations for clients with specific

needs. Our products will be sold in various sizes to meet the needs of different customers.

In addition to our feed products, we will also offer technical support services to our clients. Our

team of experts will provide advice on feeding practices, water quality management, and disease

control measures to help our clients maximize their yields and profits. We will also conduct

training programs and seminars to educate our clients on best practices in aquaculture.

To ensure the quality of our products, we will implement a rigorous quality control program that

includes regular testing of raw materials, production processes, and finished products. We will

also maintain strict hygiene standards in our facilities to minimize the risk of contamination.

As we grow, we may consider expanding our product line to include other aquaculture-related

products and services that complement our core business, such as fish farming equipment and

consultancy services. However, we will remain focused on our core competency of producing

high-quality aquaculture feed products and providing technical support services to our clients.

We will also offer customized feed formulation services to customers with specific nutritional

requirements for their aquaculture operations. Our production process will adhere to the highest

standards of quality control, and we will continually invest in research and development to

improve our products.

MARKETING AND SALES:

Our primary target market will be local and regional aquaculture farmers, fish hatcheries, and

distributors. We will also explore opportunities to expand into the international market as the
company grows. To reach our target market, we will use a multi-channel marketing approach,

including social media, trade shows, and word-of-mouth referrals.

We will establish relationships with key industry players such as fisheries, government agencies,

and academic institutions to gain credibility and increase brand awareness. Additionally, we will

offer promotional discounts and sample products to attract new customers.

Marketing and sales will be a crucial aspect of Grace Feedproduction's success in the aquaculture

feed market. To achieve this, we will implement a multi-faceted approach that includes a

combination of online and offline marketing tactics.

Online marketing tactics will include search engine optimization (SEO), social media

advertising, email marketing, and content marketing. SEO will be critical to increasing our

online visibility and attracting potential customers through search engines. Social media

advertising will be used to target specific demographics and regions to increase brand awareness

and drive traffic to our website.

Email marketing will be used to build relationships with our customers and keep them informed

about new products and promotions. Content marketing, such as blog posts and educational

resources, will be used to establish our expertise in the industry and provide value to potential

customers.

Offline marketing tactics will include participation in trade shows and events, as well as targeted

print advertising in industry publications. Participation in trade shows will provide an

opportunity to showcase our products and services to potential customers, as well as network

with industry professionals. Targeted print advertising will be used to reach potential customers

who may not be as active online.

Our sales strategy will involve building relationships with key players in the aquaculture

industry, such as fish farmers and distributors. We will offer competitive pricing, flexible

payment terms, and customized product solutions to meet the specific needs of our customers. In

addition, we will provide exceptional customer service to build loyalty and maintain long-term

relationships with our customers.

To support our marketing and sales efforts, we will invest in a robust customer relationship

management (CRM) system that will allow us to track customer interactions and analyze sales

data to improve our marketing and sales strategies.

OPERATIONS AND MANAGEMENT:

Grace Feedproduction will be located in a strategic location close to the target market, with

adequate access to raw materials and transportation infrastructure. The company will operate on

a lean model, with a focus on efficiency and cost-effectiveness. Our team will consist of

experienced professionals in feed production, aquaculture, marketing, and finance.

We have a robust operational and management structure to ensure efficient and effective

operations. The company will be headquartered in Lagos, Nigeria, with a manufacturing facility

in Ogun state. The facility will be equipped with modern equipment and staffed with a team of

experienced professionals who will ensure that the highest quality standards are maintained.

The company will have a lean organizational structure, with a small management team

overseeing the day-to-day operations. The management team will consist of a CEO, a Chief

Operating Officer (COO), a Chief Financial Officer (CFO), and a Chief Marketing Officer

(CMO). These executives will work closely together to ensure that the company's goals and

objectives are met.

In terms of production, Grace Feedproduction will use a Just-in-Time (JIT) inventory system to

ensure that feed is produced as needed and is always fresh. The manufacturing process will be

closely monitored to ensure that quality standards are maintained. The company will also

implement a strict quality control program to ensure that only high-quality products are delivered

to customers.

The company will have a strong focus on employee training and development to ensure that staff

members are knowledgeable and equipped with the skills needed to carry out their duties

effectively. Regular training sessions will be held to keep employees up to date with the latest

industry trends and developments.

To ensure effective communication and collaboration, the company will implement a state-of-

the-art enterprise resource planning (ERP) system. This system will enable the company to

monitor and manage operations in real-time, from production to sales and delivery.

Overall, the operational and management structure of Grace Feedproduction will be designed to

ensure that the company operates efficiently, produces high-quality products, and meets the

needs of customers.

FINANCIAL PROJECTIONS:

Grace Feedproduction expects to have a strong financial performance over the next five years.

Our projections are based on a conservative estimate of demand for our products and services, as

well as a realistic assessment of our operating costs and investment requirements.

Revenue Projections:

Revenue projections are a crucial component of our business plan as they indicate the expected

income for Grace Feedproduction. Our projections are based on a variety of factors, including

market demand, pricing, and production capacity.

We anticipate that our revenue will grow steadily over the next five years, with an expected

increase of 15% annually. In the first year of operation, we expect to generate a total revenue of

N20,000,000. By the end of the fifth year, we project our annual revenue to reach N38,000,000.

Our revenue streams will be derived from the sales of our fish feed products. We will utilize a

pricing strategy that takes into account our production costs, market demand, and competitor

pricing. As we establish ourselves in the market and gain a larger share of the market, we will be

able to increase our prices accordingly.

Our sales strategy will focus on building relationships with key players in the aquaculture

industry such as fish farmers, fish feed distributors, and seafood processing plants. We will also

employ a multi-channel approach to sales, utilizing both online and offline channels.

Overall, we are confident in our revenue projections and our ability to achieve our financial goals

over the next five years.

Cost Projections:

Cost projections are an important part of any business plan, as they provide an estimate of the

expenses that the company will incur in order to operate and generate revenue. For Grace

Feedproduction, we have projected various costs associated with feed production under

aquaculture, including:
1. Raw Materials: The cost of raw materials, such as fish meal, soybean meal, and other

ingredients used to produce the feed.

2. Labor Costs: The cost of hiring and retaining skilled labor to operate the feed production

facility and manage the production process.

3. Rent and Utilities: The cost of renting a suitable facility for the production of feed and the

associated utility costs, such as electricity, water, and gas.

4. Equipment and Machinery: The cost of purchasing, maintaining, and repairing equipment and

machinery used in the production process, such as mixers, extruders, and grinders.

5. Packaging and Shipping: The cost of packaging the feed and shipping it to customers.

6. Marketing and Advertising: The cost of marketing and advertising the feed products to

potential customers.

Based on our market analysis and revenue projections, we have estimated the total cost of

production for Grace Feedproduction to be around N15 million in the first year of operation.

However, we anticipate that these costs will decrease as the company becomes more established

and production processes become more streamlined. We will continuously review and adjust our

cost projections as needed to ensure that our business remains financially viable and sustainable.

Investment Requirements:

To successfully establish and operate Grace Feedproduction, we will require an initial

investment of N20 million. This will cover the cost of land acquisition, building construction,

equipment and machinery purchase, raw material acquisition, and initial staffing costs.
The breakdown of the investment requirements is as follows:

- Land Acquisition: N5 million

- Building Construction: N6 million

- Equipment and Machinery Purchase: N4 million

- Raw Material Acquisition: N3 million

- Initial Staffing Costs: N2 million

We anticipate a payback period of two years and expect to break even by the end of the second

year. After that, we project a steady increase in revenue and profitability as we establish

ourselves in the market and build a loyal customer base.

We plan to finance the initial investment through a combination of equity and debt financing. We

will seek out investors who share our vision and are interested in supporting the growth and

development of the aquaculture industry. We will also apply for loans and credit facilities from

financial institutions to help finance our operations.

We are confident in our ability to execute our business plan and achieve our financial goals with

the necessary investment and support.

Profit and Loss Projections:

Profit and loss projections are essential components of any business plan as they help determine

the financial feasibility and profitability of a company's operations. In the case of Grace

Feedproduction, our projections are based on our expected revenue and cost projections for the

first five years of operation.

We anticipate that our revenue will grow steadily each year as we increase production and

expand our market reach. In the first year of operation, we project revenue of ₦50 million,

increasing to ₦80 million in the second year, ₦120 million in the third year, ₦150 million in the

fourth year, and ₦180 million in the fifth year.

Our cost projections include direct costs such as raw materials, labor, and production expenses,

as well as indirect costs such as rent, utilities, and marketing expenses. We project that our direct

costs will increase each year as we scale up production, but we anticipate that economies of scale

and operational efficiencies will help offset these increases.

Based on our revenue and cost projections, we expect to see a net profit in the third year of

operation, with profitability increasing each year thereafter. Our projected net profit for the first

year of operation is ₦2.5 million, increasing to ₦10 million in the second year, ₦18 million in

the third year, ₦24 million in the fourth year, and ₦30 million in the fifth year.

It's important to note that these projections are based on a number of assumptions and market

conditions, and are subject to change based on a variety of factors such as changes in market

demand, production costs, and competition. We will closely monitor our financial performance

and adjust our strategies as needed to ensure continued profitability and growth.

Cash Flow Projections:

Cash flow projections estimate the inflow and outflow of cash over a specific period, typically

one year. For Grace Feedproduction, cash flow projections show the expected cash receipts and

payments based on revenue and cost projections.

We project that in the first year, Grace Feedproduction will generate a total of ₦50 million in

revenue, with a net income of ₦10 million. Our operating costs are estimated to be ₦30 million,

and our investment in equipment and facility upgrades will be ₦5 million.

The cash inflow for the first year is projected to be ₦50 million, with cash outflows of ₦35

million. The major sources of cash inflow include sales revenue, loans, and investments. Our

cash outflows will primarily be for purchasing raw materials, paying employee salaries, and

making loan repayments.

Based on these projections, we expect to have a positive cash flow of ₦15 million at the end of

the first year. This will give us the flexibility to reinvest in the business, pay dividends to

shareholders, and prepare for future expansion.

In subsequent years, we expect to continue to generate positive cash flows, with increasing

revenue and net income. We will continue to monitor and adjust our projections to ensure that

we maintain a strong financial position and are able to achieve our long-term goals.

CONCLUSION:

In conclusion, Grace Feedproduction is a promising venture with strong potential for growth and

profitability in the Nigerian aquaculture industry. We have identified the increasing demand for

high-quality fish feed and have developed a comprehensive business plan to meet this need. Our

focus on producing cost-effective and nutritious feed will give us an edge in the market and help

us capture a significant share of the market.

We have projected a steady increase in revenue and profitability over the next five years, and our

financial projections indicate that we will be able to reach our goals with the necessary

investments. Our experienced management team has a proven track record in the industry, and
we have implemented robust operations and supply chain management strategies to ensure the

efficient delivery of our products.

We recognize the potential challenges that may arise, such as fluctuations in commodity prices

and regulatory changes. However, we have contingency plans in place to address these

challenges and remain adaptable to changing market conditions.

Overall, we are confident in our ability to succeed and make a positive impact in the aquaculture

industry. Our commitment to excellence in product quality, customer service, and sustainability

will drive our success and help us achieve our long-term objectives.