BUSINESS PLAN

ON

Business Name: “Grameen Agriculture & Fisheries Farm”

GAFF
Live Healthy
Life!

Executive summary

We, some entrepreneurs, have decided to start a business. The purpose of our business is to-

1. Maximize our wealth.

2. Provide protein for the rural people.

3. Produce environment friendly products.

0
4. Create employment for the rural people.

5. Provide standardized product for the consumers with minimum cost.

To fulfill these purposes we have chosen a business which is based on the agriculture .Main
focus of our business is to produce agricultural products & supply these products to the big cities
after fulfilling the local demand. We have decided to identify this business as “Grameen
agriculture & fisheries farm”. We decided to set up our proposed business at Goshairhat thana
under Shariatpur district .Here we shall cultivate fish, rare cows & poultry & provide
fish ,milk ,eggs to the people.

We selected Goshairhat as our business place because of lakes, ponds, fields. The place is
situated in a sight from where communication is much easier to the Shariatpur district for which
our transportation cost will be minimized. It is our great wish to make branding of our products.
We shall leave no stone unturned to ensure the quality of the products. If we are able to make
quality products then we will get huge consumer base which will be the first step of our success.

We will operate our business in partnership form. The key people of our business are local labors
for production, employers for administration & marketing.

Our product’s market is too widespread .Although there are many existing suppliers of these
products, but we can enter into the market easily because of huge demand & customer base. We
will use market penetration pricing strategy to increase our market share.

1) We estimate that our initial capital requirement is almost tk.8million to lease lands &
incur all other initial expenses. We expect that in first few years there will be no profit.
We also expect that after some years there will be huge revenue with lesser cost. We
expect that it will take almost five years to reach Break Even Point.

1
 A. Business Description

Legal structure or form:

Our proposed business will be formed as a partnership firm. The number of its member will be
six. And reasons behind choosing this business form are as follows:-

 Large capital collection than sole proprietorship firm,

 Managerial expertise,
 Direct control of business operation,
 Availability of labor,
 Availability of raw material ,
 Environment friendly business,
 Direct marketing to customer.

Business type

Our business is agro business and related to production of agricultural products. Its main task
will be cultivation of fish, vegetables, rearing of (farm) hens, ducks, livestock and selling to the
consumers. We will do this by taking lease of land in rural area from the rural people. We will
cultivate fish in the pond and make poultry firm in the middle site and above that pond. So that
we can use the excrement of hen and duck as best food for fish. On the other hand, we will use
cow-dung as a manure of vegetables and food of fish. Using the cow-dung and excrement, we
will make a bio gas plant that can be used for cooking and to produce electricity.

Goals and objectives

Our goals and objectives are-

 To create employment of agricultural people,

 Proper use of agricultural land,
 To supply fresh foods within affordable price,
 To encourage agricultural based business,
 To fulfill the local demand,
 To alleviate poverty of rural people,

2
  To meet the lack of protein.

Products:

1) Fish
2) Vegetables
3) Meat
4) Egg
5) Milk

Products features:

The main distinguishing features of our products will be the hygienic and fresh. We will offer the
products that will be cultivated in our farm. We hope that our products will meet the following
features such as-

 Fresh and hygienic,

 Low price,
 Homemade,
 Easy payment system,
 High quality.

Customer benefits:

Our customer will get the best benefit from our product than the others. Because we will supply
fresh, hygienic, and high quality product within the lowest possible price. They can justify our
product very easily. We will give discount on bundle purchase and supply of goods to the
customer’s door.

3
Patent /trademark:

Since our business is agro business and is related to daily necessaries so that it is not necessary to
maintain any patent or trademark of the product.

Location:

Our proposed business will be situated in a rural area. We have selected the location in
Shariatpur at Goshairhat.

Proximity to customer:

Our main customers are local people and our customer’s bases are very strong. Besides this we
will supply surplus of our product to the big cities.

Proximity to raw materials:

To do such business we need land, labor, and manure as raw materials and that are available in
that area.

Proximity to other facilities:

We will be able to supply our products directly to the customer. That’s why our marketing cost
will be very low. We will use cow-dung and excrement of hen and duck as a food of fish that
will save our cost.

The main reason behind selecting that location is proximity of raw materials and other proximity
also considered here.

4
 Marketing plan

Features:

Feature is a competitive tool for differentiating the company’s product from competitor’s
products. We will make our business with such products which are natural actually. That’s why
these products’ features are almost similar to that of competitor’s products. But we will make our
product different by providing fresh products & ensuring the purity of the products.

We will use the waste of cow’s fishes & poultry farm as bio fertilizer into cultivable land. As a
result we will get some profit from selling this waste.

Competitive Benefits:

There are different types of small or big companies or local marketers who have already been
doing business with these products. Some get these products from the supplier & then sell these
products to the customers. Some local marketers only provide these products to the chain shops.
As we are producers as well as suppliers so it will be so much easier to keep the prices low, enter
into the market & capture the huge consumer base.

We shall avoid the use of formalin in case of presenting these products. We shall make the
people understood of the freshness of our products.

Packaging:

Packaging involves designing & producing the container or wrapper for a product .The
packaging may include primary package & secondary package. Innovative packaging can give a
company an advantage over competitors & create instant consumer recognition .In contrast
poorly designed package can cause headaches for consumers & lost sales for the company. In
case of our products we shall use primary package for the single products. But we shall use
secondary package for more than single products. Printed information will appear on or with the
package. Information will contain weight, name, date, types, & others.

5
Price:

1. Average price for fish per kg140tk.

2. Average price for hen & duck per kg130tk

3. Average price for milk per liter 35tk

4. Average price for meat per kg220tk

5. Average price for vegetables per kg10tk.

Costs:

Variable cost:

1. Average variable cost for fish per kg 50tk.

2. Average variable cost for hen & duck per kg 50tk.

3. Average variable cost for milk per liter 10tk.

4. Average variable cost for meat per kg 100tk

5. Average variable cost for vegetables per kg 4tk

Fixed cost:

Manufacturing Fixed Cost Tk.7, 00,000+Operating Fixed Cost (Employee Salary-6, 24,000+
Taxes and Rent-12,000+Maintenance- 1, 20,000+ Telephones & Telegraph-8,000+Electricity &
Water-36,000+Insurance Expenses-60,000+Depretion-3,22,000+deplation-1,00,000+Others-
5,000) +Other-Fixed Cost (Interest on Capital & Loan)-12,00,000 = TK.31,87,000

6
Notes: All prices are subject to change of market situation.

Pricing strategy:

We shall use market penetration pricing strategy .Market penetration strategy is setting lower
initial price rather than setting higher initial price to penetrate the market quickly & deeply.
Using the strategy we can attract a large number of buyers quickly & win a large market share.
We shall minimize costs by direct selling. The existing companies will not be able to match the
prices of our products because of the intermediaries & dependency upon the supplier’s choice.

Competitor’s analysis:

Since our major products are poultry, fish, milk, meat, egg; that’s why we will face some
competition in the market. Because these products we usually use to meet our daily necessities
especially in the deficiency of protein. It has been seen that, the demand for these types of
products are always high. As a result, there is low competition witnessed for these products.

Stages of market life cycle:

1. Product development

2. Introduction

3. Growth

4. Maturity

5. Decline

7
 Purchase of chicken,cow,fry,duckling
Chicken of farm hen

Earn revenue Produce egg,milk,fishes

Market life cycle

Selling those directly in the market

Figure: Market life cycle

As we are new in the market then we will try heart & souls to develop our products while sales
may be zero & much investment will be needed.

Then we will introduce our products in the market. There will be slow sales growth & may not
be profit because of the high expense.

If the products get rapid acceptance then profit will increase & we will be able to minimize our
expenses.

After the acceptance of these products we will minimize our sales price & target potential
buyers.

Market segmentation & targeting:

We can use different types of segmentation for the marketing of our products. We can use
geographic, demographic & income segmentation.

8
In the different parts of our country people have different choices for foods. So we shall
emphasize on the choice of these people. Based on income level and occupation we shall arrange
our products available & easily purchasable for the lower income class people. We shall target
aristocrat class as well as lower income class people.

Place:

Distribution channel: We shall minimize the necessity of intermediaries’ .Mainly we

shall use direct selling system. We shall employ several efficient sales people & managers for
distributing our products. This whole system will be entitled to us.

Storage: Sometimes sales may fall & increase. So for this we have to have an efficient
freezing system so that we can preserve our surplus products. We can arrange a cold storage in
our farmland. In the shops we shall arrange refrigerators.

Promotion:

Advertising: As we are new into the market we shall adopt informative advertising .we
shall introduce the market with our products. From time to time we shall inform the market of
price change, describe available services, correct false impressions & build an image of our
company. Then we will use persuasive & reminder advertising strategy.

Public relation: we shall build good relations with the company’s various publics by
obtaining favorable publicity. For the sake of our business we have to head off all types of
rumors & build up a good business image.

We shall publish our products information’s in the news media to attract attention of the public.
We shall highlight our differentiated products in the news. We will also maintain relationship
with the national or local community as well as with the investors, legislators, investors.

Along with these activities we personally can participate in the conferences, meeting, discussions
make PowerPoint presentation to provide proper ideas about our product.

Media to be used:

1. Daily newspapers.

9
2. Satellite TV channels.

3. BTV.

4. Leaflets.

5. Personal relationship.

6. Billboard

7. Sales Promotion

8. Other types of advertisements

Frequency:

We will advertise in the dailies two times in a month when we start the business. We will make
contract with any of the TV channels to show our ad with in an interval of one hour. Beside this
we use leaflets, billboard & personal relationship to introduce the market with our product.

C. OPERATIONAL PLAN: SWOT ANALYSIS:

10
 STRENGTH WEAKNESS

1)Management expertise 1) Lack of experience.

INTERNAL
ENVIRONME
NT 2)Internal source of capital 2)Low capital

3) Forward & backward linkage. 3) Perishable product.

4) Discount on large volume purchase. 4) No existing customers.

5) Seasonal & occasional offers. 5) No direct supply for customers.

6)Fresh Product

11
 OPPORTUNITIES THREATS

1) Low labor cost. 1) Absence of easy transportation.

EXTERNAL 2) Highly competitive market.

ENVIRONME
2) Availability of land & lakes. 3) Threats of natural disaster (i.e.
NT
flood)

4)Threats of pestilence(i.e. plague,

3) Huge customer base.
bird flues, anthrax etc)

5) Lower entry barrier for the

4) Plenty of local market. competitors.

12
SUPPLY CHAIN ANALYSIS:

supplier

Grameen agriculture & fisheries

Shopping molls & local retailers

customers

We will make backward linkage with the suppliers for the purpose of collecting our necessary
fry, chicken, cows & other necessary things. In case of supplying our product, we will not use
any middleman; rather we will make forward linkage with shopping molls of big cities &

13
retailers of local markets. Mainly we will make forward linkage with mina bazaar, Amana,
Agora, Nondon, saver, cheaper, Shawpno etc.

Manufacturing plan:

We will produce fishes in the leased ponds & lakes. And also rare duckling in the ponds & lakes
in integrated cultivation process. I.e. we will make habitation for the duckling inside the ponds &
lakes so that the waste of the duckling turns into food for the fishes. We will also rare cows for
the purpose of producing milk & meat & chickens of boiler & layer nature in the leased lands.
We will also produce vegetables in the leased lands. We will also produce vegetables in the
leased lands. All of these production activities will be done by local workers /laborers.

Human resource:

Management team:

Managing director:

Md.Golam kibria, partner of Grameen agriculture & fisheries farm, will be the leader of the
management team of our farm. He will handle the overall activities of the farm.

General manager :

Md.Israfil Bhuiyan also a partner of the farm will help the managing director of the farm & also
coordinates the activities of the other managers.

Finance manager:

Md. Mahmudul Hasan khokon another partner of the farm will be responsible for all the financial
transactions of the farm.

Purchase Manger:

14
Barun chandra dey a partner of the farm will be responsible for all the purchase related
transactions.

Production Manager:

Another partner Md. Ahsan Uddin will be responsible for all the production related activities of
the farm.

Sales & marketing manager:

Md. Kabir Hussain a diligent partner of the farm will handle all the marketing related activities
& sales transaction.

15
Advisors: we will also appoint two advisors who have much experience in these sectors. They
will help our management team in case of operating their activities.

Managing Director

General Manager Advisor

Advisor

Finance manager Purchase manager Production manager Marketing & sales

manager

Fig: Organ gram of GAFF

Compensation/Salary:

16
Salary of the manager’s advisors & employees will be determined by the decision of the
management team.

D. FINANCIAL PLAN

 Start up cost
 Cash budget
 Pro-forma Financial Statements
 Income Statement
 Balance Sheet
 Cash flow Statement
 BEP analysis
 Financing the business
 Distribution of profit

17
START UP COST:

Estimated start up cost of our business is given below:

1. Recurring Expenses:

Items Monthly Total(three months)

TK
Permanent Labor (35 persons) TK.3500 per Labor
3,67,500
Employees Salaries on an average(10 TK.5200 per employee
persons) 1,56,000
Transportation expenses
5,000
Supplies
20,000
Interest of capital TK.62500
1,87,500
Interest of loan TK.37500
1,12,500
Maintenance TK.10000
30,000
Telephone & telegraph
2,000
Electricity & water TK.3000
9,000
Insurance expenses(for the year TK.5000
TK.60000) 15,000
Depletion TK.8333
25,000

18
 Other Utilities TK.2000
6,000

Total: 9,35,500

*Interest rate on capital is 15%

*Interest rate on loan is 15%

2. Non-Recurring Expenses:

Items Amounts(TK)
Land &Lake (Lease for 20 years) 20,00,000
Machinery 2,00,000
Building (registered administrative office) 5,00,000
Furniture &Equipment 5,00,000
Net 50,000
Pump Machine(3 pieces) 2,10,000
Legal Fees(Formation Purpose) 50,000
Stating Inventory:
 Fry
 Hybrid Cows( Like Australian Cow, 2,10,000
Pakistani Shahiwall)
 Chicken 5,00,000
 Duckling
 Seed & seedling 30,000
30,000 8,50,000

19
 80,000

Fish creel 50,000

Bamboo 1,00,000
Other materials 5,00,000
50,10,000
Total

 Transportation Vehicle will be required when business will go for marketing purpose; it
is planned that this vehicle will be purchased at that time.
 Other required equipments for marketing purpose will be purchased at that time.

Total Start-up Cost=TK.9, 35,500+TK.50, 10,000=TK.59, 45,500.

Pro-forma Financial Statements:

Projected Profit and Loss Statement

For The First Accounting Period

PARTICULERS
Amount(TK)
Sales 1,00,000
Cost of production 15,00,000

20
Gross Profit (14,00,000)
Operating Expenses:
Employees Salaries on an average(10 persons) 6,24,000
Tax & Rate (for the year TK.12000) 12,000
Transportation expenses 20,000
Supplies 80,000
Maintenance 1,20,000
Telephone & telegraph 8,000
Electricity & water 36,000
Insurance expenses(for the year TK.60000) 60,000
Depreciation:
Machinery and others(20% on balance) 1,00,000
Furniture & Equipment(20% on balance) 40,000
Building(20% on balance) 1,00,000
Pump Machine(20% on balance) 42,000
Net(20% on balance) 10,000
Fish Creel(20% on balance) 10,000
Bamboo(20% on balance) 20,000
3,22,000
Depletion 1,00,000
Other Utilities 24,000
Other marketing and administrative expenses 10,000
Other Expenses: 7,50,000
Interest of capital 4,50,000
Interest of loan

Net Profit Before Tax: ( 40,16,000)

Tax -
Net Profit After Tax: ( 40,16,000)

21
 Projected Balance Sheet

For The First Accounting Period

PARTICULERS Amount
(TK)
Assets:
Cash
6,85,500
Land &Lake (Lease for 20 years)
18,75,000
Machinery
4,00,000
Building (registered administrative office)
4,00,000
Furniture &Equipment 1,60,000
Net
40,000
Pump Machine(3 pieces) 1,68,000
Closing Inventory:
 Fry 2,10,000
 Hybrid Cows( Like Australian Cow, 5,00,000
Pakistani Shahiwall)
 Chicken 30,000
 Ducking 30,000
 Seed & seedling 80,000

8,50,000

22
 Fish creel
40,000
Bamboo
80,000
Start-up cost: 14,85,500
(RC:9,35,500+ LF:50,000+OM:5,00,000)
Total Assets:
61,84,000
Liability & Owner’s Equity:
Liability:
Bank-loan
30,00,000
Interest Payable:
On Capital 7,50,000
On Bank Loan 4,50,000
12,00,000
Account Payable 10,00,000
Owner’s Equity (50,00,000- NP:40,16,000) 9,84,000
Total Liability & 61,84,000
Equity:

Projected Cash Flow Statement

For The First Accounting Period

PRTICULERS TK TK
Cash-flows from operating activities:
Cash receipts from revenues 1,00,000

23
 Cash payments for expenses (14,94,000)

Net cash provided by operating (13,94,000)

activities:
Cash-flows from investing activities:

Cash-flows from financing activities:

___ ____
Interest on loan(Payable)
Interest on capital(Payable)

Net increase in cash: (13,94,000)

Cash at the beginning of the period: 20,79,500
Cash at the end of the period: 6,85,500

Workings:

1. Calculation of the Beginning Cash Balance:

Cash Beginning of the period:

Capital & Loan TK. 80, 00,000 80,
Start-up cost (59,45,500-Deplation: 25,000) 59,20,500 00,000

(59,20,500)

20,79,500

24
2. Calculation of Interest:

Interest on Capital = TK. 50, 00,000 * 15% = TK.7, 50,000

Interest on Loan = TK. 30, 00,000 * 15% = TK. 4,50,0000

Notes:

1. Only little revenue will be obtained in first year from sale of the vegetable and other materials.

2. The cost of production will be done tk.5, 00,000 by cash and remaining tk.10, and 00,000 on
account receivable.

3. As the business will have only little profit, the interest on bank loan and capital will be paid
latter.

4. As there will be no profit in first year, business need not pay tax on net profit.

5. The value of the closing inventory will have increased, but will be shown in cost, because of
the lower of cost than the market value.

6. The depreciation of the assets will be shown in double declining method.

7. The depreciation of the assets will not be shown in the start-up cost, because assets will not be
used before production. But depletion will be shown in the start-up cost, because leased
assets have been purchased before the production.

Break Even Point Analysis:

Expected Portion of Our Business Products:

 Fish 35%
 Poultry 30%
 Milk 20%
 Meat 10%

25
  Vegetables 5%

Expected Price of the Products:

 Average Price of Fish per kg. TK.140

 Average Price of Hen and Duck per kg.TK.130
 Average Price of Milk per Litter TK.35
 Average Price of Meat per kg.TK.220
 Average Price of Vegetable per kg. TK.10

Expected Variable Cost of the Products:

 Average variable cost of Fish per kg. TK.50

 Average variable cost of Hen and Duck per kg.TK.50
 Average variable cost of Milk per Litter TK.10
 Average variable cost of Meat per kg.TK.100
 Average variable cost of Vegetable per kg. TK.4

Expected Contribution-Margin of the Products:

 Average Contribution-Margin of Fish per kg. TK.90

 Average Contribution-Margin of Hen and Duck per kg.TK.80
 Average Contribution-Margin of Milk per Litter TK.25
 Average Contribution-Margin of Meat per kg.TK.120
 Average Contribution-Margin of Vegetable per kg. TK.6

Weighted-Average Contribution =90*.35+80*.30+25*.20+120*.10+6*.05 = TK.72.8

Fixed-Cost:

Manufacturing Fixed Cost Tk.7, 00,000+Operating Fixed Cost (Employee Salary-6, 24,000+
Taxes and Rent-12,000+Maintenance- 1, 20,000+ Telephones & Telegraph-8,000+Electricity &
Water-36,000+Insurance Expenses-60,000+Depretion-3,22,000+deplation-1,00,000+Others-
5,000) +Other-Fixed Cost (Interest on Capital & Loan)-12,00,000 = TK.31,87,000

26
Weighted-Average Break Event Point Quantity= Tk. 31, 87,000 / TK.72.8 = 43,777.47253 units

Average Quantity of Break Event Point for Specific Products:

 Average Quantity of Break Event Point for Fish = 43,777.47253*.35 =15,322.11539 kg

 Average Quantity of Break Event Point for Hen and Duck = 43,777.47253*.30 =
13,133.24176 kg
 Average Quantity of Break Event Point for Milk per Litter = 43,777.47253*.20 =
8,755.494506 litter
 Average Quantity of Break Event Point for Meat =43,777.47253*.10 = 4,377.747253 kg
 Average Quantity of Break Event Point for Vegetable = 43,777.47253*.05 =
2,188.873627 kg

Note: Break Event Point is subject to change, because of the change of depreciation which is
calculated on double declining method and other change of the fixed cost.

Financing the Business:

We will finance our business by collecting capital from the partners. Our estimated capital
requirement is TK. 80, 00,000. Financing of the business will be as follows:

From Partners:

 Md.Golam Kibria TK.10,00,000

 Md. Ashan Uddin TK.10,00,000
 Md.Mahmudul Hasan TK.10,00,000
 Md. Israfil Buiyan TK.10,00,000
 MD. Kabir TK.5,00,000
 Barun Chandra Dey TK.5,00,000

From Bank-Loan:

TK.30, 00,000 for 10 years @15%

27
Profit Distribution Policy:

For first four years no profit will be distributed. After four years 10% of profit will be
distributed, after 10 years 35% profit will be distributed. Partners are allowed to take loan from
the business according to the decision taken by all, if available.

28