Business Plan

BUSINESS PLAN:
Improvement of the Production of Fattening Beef Cattle of the Association of Cattle

Fatteners of the VILCANOTA VALLEY of the District of Quiquijana , Quispicanchi,
Cusco.
QUQUIJANA DISTRICT
MUNICIPALITY
PROCOMPITE - 2012
BUSINESS PLAN: “IMPROVEMENT OF THE PRODUCTION OF BEEF FATTENERS OF THE ASSOCIATION OF FATTENERS OF THE VILCANOTA
VALLEY, DISTRICT OF QUIQUIJANA, QUISPICANCHI, CUSCO”
INDEX
1. BUSINESS..............................................................................................................................3
1.1. BUSINESS DEFINITION..................................................................................................3
1.2. NAME OF THE PRODUCTIVE PROPOSAL......................................................................5
2. MARKET RESEARCH..............................................................................................................5
2.1 DEMAND ANALYSIS......................................................................................................5
2.1.1 Market segmentation...........................................................................................7
2.2 DETERMINATION OF THE DEMAND-SUPPLY GAP.....................................................10
3. SURROUNDING ANALYSIS...................................................................................................10
3.1 MACRO ENVIRONMENTAL ANALYSIS........................................................................10
3.2 MICRO ENVIRONMENT ANALYSIS.............................................................................12
4. ORGANIZATION..................................................................................................................14
4.1 LOCATION OF THE AEO..............................................................................................14
4.2 COMPOSITION OF THE AEO BOARD OF DIRECTORS.................................................16
4.3 AEO PARTICIPANTS....................................................................................................16
4.4 PROFIT DISTRIBUTION STRUCTURE...........................................................................18
4.5 MEASURES TO AVOID MISMANAGEMENT OF AEO...................................................18
4.6 AEO ORGANIZATION CHART......................................................................................18
5. BUSINESS PLANNING..........................................................................................................18
5.1 BUSINESS OBJECTIVES...............................................................................................19
5.2 SWOT ANALYSIS.........................................................................................................19
5.3 STRATEGIC ALLIANCES AND BUSINESS OPPORTUNITIES..........................................21
6. OPERATIONAL PLAN...........................................................................................................21
6.1 OPERATIONAL REQUIREMENTS OF THE AEO............................................................21
6.2 TECHNICAL EXPLANATIONS AND PRODUCT DESIGN.................................................22
6.3 DEFINITION OF THE PRODUCTION PROCESS.............................................................23
6.3.1 General characteristics of the production process.............................................24
6.3.2 Characteristics of the acquired animals..............................................................24
6.3.3 Productive process.............................................................................................25
6.3.4 Feeding program................................................................................................26
6.4 BUSINESS LOCATION..................................................................................................26
7. MARKETING PLAN..............................................................................................................28
7.1 MARKETING OBJECTIVES...........................................................................................28
7.2 TARGET MARKET........................................................................................................29
Association of Beef Fatteners of the Vilcanota Valley. Page 1

7.3 PRODUCT...................................................................................................................29
7.4 PRICES........................................................................................................................29
7.5 PROMOTION AND PUBLICITY....................................................................................30
7.6 SQUARE......................................................................................................................30
7.7 POSITIONING.............................................................................................................30
7.8 DISTRIBUTION............................................................................................................30
8. GENERAL FEATURES...........................................................................................................31
8.1 ENVIRONMENTAL IMPACT PLAN...............................................................................31
9. INVESTMENT AND FINANCING PLAN..................................................................................33
9.1 JUSTIFICATION OF CO-FINANCING............................................................................33
9.2 IMPROVEMENT OF THE PRODUCT OR SERVICE........................................................34
9.3 TECHNICAL ASSISTANCE AND/OR TRAINING REQUIRED...........................................34
9.4 INVESTMENT PLAN AND OPERATION AND MAINTENANCE COSTS..........................35
9.4.1 Total investment required for the PDN..............................................................35
9.4.2 PDN financing structure......................................................................................36
9.4.3 Analysis of Fixed and Variable costs...................................................................38
9.5 DETERMINATION OF THE SALES PRICE......................................................................39
9.6 DETERMINATION OF INCOME...................................................................................39
9.7 BREAKEVEN ANALYSIS...............................................................................................40
9.8 PROFITABILITY EVALUATION.....................................................................................40
10. INDICATORS OF IMPACTS OF THE PRODUCTION PROPOSAL..........................................41
11. CONCLUSIONS................................................................................................................44
12. ANNEXES........................................................................................................................45

PRODUCTIVE PROPOSAL:
“IMPROVEMENT OF CATTLE PRODUCTION IN GORDE,

VILCANOTA VALLEY, QUIQUIJANA DISTRICT,
QUISPICANCHI, CUSCO”
1. BUSINESS
1.1. BUSINESS DEFINITION
This business plan will be defined based on unsatisfied needs and potential clients, seeking to
be objective enough to be able to conceptualize it later, and flexible to be able to deal with the
changes that always arise in the business environment.
The concept is based on the findings of the market study that clearly demonstrate that within
the capital of the Cusco and Arequipa region, there is an unsatisfied demand for quality beef
and an immense potential market ceiling, due to the open and positive attitude. of the majority
of the population.
On the other hand, analyzing the environment, we find that in the rural sector work has been
done on the improvement of cattle through productive development projects that have
understood the strategic role of the species in peasant development. These projects face one of
their main challenges when seeking a market for products that, due to the positive impact of
their operations, have increased in quality and quantity in the area.
On the other hand, the business idea is to insert beef into the regional market through the
business plan called: “Improvement of the Production of Fattened Beef Cattle, from the
Vilcanota Valley, Quiquijana District, Quispicanchi, Cusco” and explained In the graph it
basically has the fusion of 2 needs, according to this approach:
 The need of the potential and effective demanding population. Which is that demand in
the market that is unsatisfied.
 The need of the supplying population. That population that from now on we will call the
producers (AEO) of livestock production.
Graph No. 01
Familias de la Región Productores organizados a

IDEA
Cusco que demandan tra vés de un Proyecto de
DE Des arrollo dirigido por una
carne de Res.
NEGOCIO Ins titución.
Necesidades de Necesidades de
satisfacer alimentación encontrar un Mercado
y deseo de consumo. para su Producción.
Source: self made.

In this context, our Business Plan “Improvement of the Production of Fattened Beef Cattle,
from the Vilcanota Valley, District of Quiquijana, Quispicanchi, Cusco” , was born due to the
initiative of the members of AEO and the potential and favorable conditions that each producer

and with the expectation of being able to increase the family per capita income, since there is
the necessary and sufficient assets as entrepreneurs, this activity adapts to our valley area; In
that sense we have a regional market (Arequipa and Cusco) to which we can insert ourselves;
For this purpose, this table explicitly explains the conditions and requirements required for a
business plan according to Law No. 29337 that establishes provisions to support productive
competitiveness - PROCOMPITE.
Among the possible business plans that we can develop according to our productive vocation
we have:
 PN1. Cattle fattening
 PN2. Dairy cattle production
 PN3. Starchy corn production
 PN4. Potato production
 PN5. sheep production
Table N°01
EVALUATION OF THE IDEA PRESENTED
PN 1 PN 2 PN 3 PN 4 PN 5
Y Y Y Y Y
Guiding Questions / Business Proposal (PN)
ea No ea No ea N0 ea No ea No
h h h h h
Do you want to do this project? x x x x x
Do I have assets to co-finance (labor, land, cash, etc.? x x x x x
Do you belong or could you form an association for the
x x x x x
good or service to be produced?
Is it possible to produce the product in the
x x x x x
district/region?
Is there an unsatisfied market for this product? x x x x x
Total "Ideas with Yes" 5 3 4 3 3
Our plan “Improvement of the Production of Fattened Beef Cattle, from the Vilcanota Valley,
Quiquijana District, Quispicanchi, Cusco”, aims to increase the productivity and
competitiveness of our product (fattened bull) in order to achieve a product according to the
demands of the market; In that sense, achieving our objectives will increase the level of sales
and family per capita income with a positive expectation of dedicating ourselves to this activity
in a comprehensive manner, which will lead to being able to increase our standard of living in
the medium term and a positive externality. to society as a whole.
In this context, our activity is basically focused on increasing the productivity and
competitiveness of our fattened cattle product through improving productive infrastructure,
availability of green forage, and technical assistance.
a) Location of the proposal in the production chain.

The economic activity in which our AEO is immersed within the productive chain, and with
which we wish to enter the market is “Beef cattle” in the production stage (sale of live
cattle); To achieve this expectation we need sufficient factors and inputs within our
association to be able to offer the demander a quality product according to market
demands.
Table No. 02
Location of the Productive Chain (PRODUCT) Tick
Production x
Post-production
Transformation
Commercialization x
b) References of productive proposals

 Central Association of Pre-fattening Cattle Producers of Huancané and Moho –
Puno.
 Huatasani District Association of Pre-fattening Beef Producers
 Huancané District Association of Pre-fattening Beef Producers.
 Villa Huichuma Agricultural Producers Association, from the district of Pallpata,
Espinar.
c) Experience
The AEO is made up of 28 active members, all of them producers who are dedicated to the
activity of fattening cattle, who live in the Accopata, Ccolca, Usi, Huacaytaqui, Huaraytapa,
Callacunca, Quiquijana communities of the Quiquijana district, having one of The main
economic activities are livestock activity, the main livelihood being the fattening of cattle,
because there are favorable climatic and environmental conditions for the development of
this activity as development assets.
They have been partners for more than 4 months, and since their organization they have
developed a series of activities to improve productive activity, including the expansion of
the forage frontier with the planting of pastures, attendance at training in organizational
strengthening.
1.2. NAME OF THE PRODUCTIVE PROPOSAL.
“Improvement of the Production of Fattened Beef Cattle, in the Vilcanota Valley, Quiquijana
District, Quispicanchi, Cusco.”
2. MARKET RESEARCH
We will first analyze the market demand and what factors influence our product, then we will
determine the demand for beef in the target market and the demand for cattle currently in the
market, on the other hand we will analyze the supply of beef cattle in the regional market and the
production that we currently have once our business plan is implemented and co-financed, to then
determine the balance of the beef cattle market, and as producers what percentage of this
unsatisfied demand we would like to cover once co-financing has been obtained through
PROCOMPITE.
2.1 DEMAND ANALYSIS
The present productive proposal of the AEO (Association of Livestock Feeders of the Vilcanota
Valley, District of Quiquijana, Quispicanchi, Cusco”) is made up of 28 producers, where each
producer will produce 4 cattle during a period of 4 months (120 days), in such a way that it will
produce 12 fattened cattle for the market in one year and in the association (AEO) they will jointly
produce 336 cattle for meat, which will be marketed on the livestock platforms of Combapata,
Sicuani and Urcos to the intermediaries, who articulate marketing with our potential demand that
will be the market of the Arequipa Region.

In this context we will analyze the factors that influence the determination of the demand for our
product:
 Price of the product.

One of the expectations that the plaintiff manages before consuming a product, the first
thing he sees is the price of the good, but not the quality and/or presentation in general,
in that sense according to the Technical Report on Implementation of the Initiative of
Support for Competitiveness Law No. 29337 – PROCOMPITE, carried out the market study
of prices in the regional market of Cusco, the result is that the price per kilo of live cattle
meat is S/. 9.00 Nuevos Soles.
On the other hand, the initiative of this business plan aims to offer a product with the
quality conditions demanded by the Arequipa market, where the price of the carcass is
above S/. 14.50 Nuevos Soles, a market that currently has unsatisfied demand.
It is also considered that jointly the AEO partners will produce fattened cattle weighing
over 364 kilos on average.
 Traditions.
Although this factor is not one of the determinants of demand in a higher percentage, it is
interesting to analyze it, since beef is highly sensitive because it has close substitutes such
as chicken meat, whose price is below beef, in that understanding and despite the fact
that our consumer prefers to consume and is accustomed to consuming our product; In
times of price inflation, they will prefer to consume close substitute products; To
counteract this our product will be a quality product.
 Preferences.
The preferences of the demander to consume a product are determined by the price and
the existence of substitute goods, so in order not to lose our potential clients as
producers, we will manage reasonable prices, as well as strategically use the recognition
that we have at the regional level as “Quiquijana”. , capital of the Fattened Bull.”
 Rent.
Consumers prefer to consume a product based on their per capita income, which is
decisive for their basic family basket. In this context, the strategy to use as producers of
this product is based on the quality of our product and the attributes it contains; achieving
a position within the regional market of intermediaries such as high-quality fattened bulls.
 Expectations about the future.

Economic activity in general moves based on expectations that the consumer may have of
a certain product to be able to consume it in the present or in the future. For this, the
indicator that determines is price inflation or the low income that could be perceive
consumers in the face of changes in the economy, for this purpose our product will have a
standardized price in these circumstances.
 Main plaintiff groups.
The demand for beef today is in large quantities, this is due to the low price it has in the
market compared to other types of meat or substitutes. In this context, the demand for
beef in the Cusco market can be identify in the Food Markets of Vinocanchon, Wanchaq,
Cascaparo, San Pedro, among others; Likewise, a part of the production of fattened cattle
will be destined for the Arequipeño market, which offers better prices than the regional
market of Cusco; On the other hand, according to the Systematization Study: “Innovative

experience of fattening and marketing of beef cattle in the Cusco Region” 1 carried out by
the Puno Cusco Corridor Project, mentions that the per capita consumption of beef is 5.17
kg/inhabitant/year, with the department of Lima being the main demander with a per
capita consumption of 7.3 kg.
On the other hand, our beef cattle product, once the fattening production cycle has been
completed (4 months), will be in adequate and optimal conditions to take it to the market,
which will have the Arequipeño market as a potential demander, this through the sale of
our products in the cattle platforms mainly from Combapata, which are attended by
merchants, intermediaries who take to the Arequipa market.
 Consumer profile.
That intermediary who buys our product will have the negotiation conditions regarding
the determination of the price of live cattle (Intermediary of the Arequipa market), and
eliminating market failures regarding asymmetric information of real prices. In this way,
both producers and consumers have equitable profits.
2.1.1 Market segmentation.
To identify the target market of this productive proposal, it is necessary to segment the beef
demand market, so we consider the analysis of the Cusco region, Arequipa and at the national
level.
On the other hand, according to statistics on beef consumption at the national level, it is 5.17
kg per person per year, in the capital Lima, and according to FAO studies, it is recommended
that this should be 18 kilos per person per year, in This understanding of the per capita
consumption of beef in Peru is far below the recommendation provided by the FAO.
To adequately identify the demand for the beef market in the Arequipa and Cusco region, we
proceed to analyze the beef cattle profit data at the national level, the Arequipa region and the
Cusco region. According to the following detail:
Cuadro N° 03
Beneficio de ganado vacuno en camales. Año 2011
Beneficio camales Beneficio Beneficio camales
Región
unidades camales tn kg/und
Nacional 970506 169321 174.5
Are qui pa 86614 14640 169
Cus co 60462 9795 162
FUENTE: MINAG – OEEE. Producción pecuaria e Industria Avícola 2011
It can be seen that the Arequipa region represents 8.6% of the total livestock benefited at the
national level, and the Cusco region 5.78%.
1
Systematization Study: “Innovative experience of fattening and marketing of beef cattle in the Cusco Region.” Puno Cusco
Corridor Project.

To have a definitive idea of the beef marketing circuit at the national level and in the Cusco and
Arequipa region, we need to compare demand with supply. If a region's production is enough
for its own consumption, where to identify if a region is attractive as a market for meat-
producing regions.
To determine said supply we identify meat production in units, meat production in tons and
meat production in kg/und.
Table No. 04
Beef production (supply). Year 2011
Meat production
Region Prod. tn meat Prod. Meat kg/unit.
and
National 1263564 178582 141.3
Arequipa 10233 4708 169.1
Cusco 88230 12012 136.1
SOURCE: MINAG – OEEE. Livestock Production and Poultry Industry
2011
According to table 04, it can be stated that the Arequipa region represents 2.06% of the total
beef production at the national level, and the Cusco region represents 6.72%.
It can be concluded that the Arequipa region consumes 8.6% of the national meat production
but only produces 2.06%, so this region would not produce enough beef to cover its
consumption, making it an attractive market to place the surplus of the production from
regions like Cusco.
On the other hand, the Cusco region consumes 5.78% of the national beef production and
produces 6.72%, where the region produces enough beef to cover its consumption and 14% of
its production is outsourced outside the territory.
From this analysis it is concluded that the target market is the Arequipa region because it has
an unsatisfied demand.
2.1.1. Projected demand
To obtain the projected demand, the average growth rate is calculated, which is equivalent to
1.105%, based on the growth of supply and demand from 2008 to 2011.
The calculation of the projected demand for the beef market in the Arequipa region is specified
below:
Table No. 05
Projected demand for beef Region Arequipa
Year Demand tn
2008 8,733.00
2009 10,813.00
2010 14,010.00
2011 14,640.00
2012 16,901.88
2013 19,513.22
2014 22,528.01
2015 26,008.59

Source: own elaboration based on data from: MINAG – OEEE.

Livestock Production and Poultry Industry 2011
 The product or service of the productive proposal.

The Association of Fattened Bull Producers of the Qquehuarmayo Microbasin currently
has 28 members and/or families according to the register registered in the minute book,
where it currently produces an average of 9 cattle per year, which have levels feed
conversion rate below 950 grams per day, mainly due to the fact that fattening cattle are
tied with stakes to grazing areas, developing a semi-intensive activity, due to the fact that
they do not have productive infrastructure with feeders that allows stabling and avoid
energy loss, making the fattening process more efficient; but in view of the expectation of
the PROCOMPITE competitive plan, this sub-sector finds itself eager to undertake and
participate, where each producer, according to the conditions of their environment and
the assets they possess, in terms of the availability of the land factor and additional inputs
and the labor, aims to improve their production and productivity, where they propose
through their plan "Improvement of the Production of Fattened Beef Cattle, of the
Vilcanota Valley, Quiquijana District, Quispicanchi, Cusco", that each producer once
implemented the business plan and co-financed by the District Municipality of Quiquijana
will produce 4 cattle for a period of 4 months, with a marketing weight of 364 kilograms
per cattle (live weight) and during the year each producer will produce 12 cattle or
equivalent to 4,368 kilos of beef.
 Define the unit of measurement.

The Association of Fattened Bull Producers of the Qquehuarmayo Microbasin; Once
financing has been obtained from the local government through PROCOMPITE, it will be
dedicated to producing beef cattle (12 units per year), where its quantification will be
heads of bulls for fattening per period and/or year.
 Define the bidders.

The suppliers of the beef cattle market within our environment are those producers,
existing Associations within the Cusco region that are dedicated to this sub-sector in an
extensive and incipient manner for the most part, located mainly on the valley floor, the
market that The regional economy in this sub-sector is energized by the Combapata cattle
show and other existing fairs at the regional level.
 Offer estimation model.
It should be noted that the AEO is made up of 28 members, producers of fattening cattle,
whose main economic activity is the sale of fattened bulls on the Sunday tablada in the
district of Combapata and the tablada in the city of Sicuani. To obtain the product
(fattened bull of 364 kg on average), the following is considered:
 Three campaigns are carried out a year. With a duration of 120 days per
campaign
 Each partner starts with an average of 04 bulls per campaign. A minimum of 12
fattened bulls must be marketed each year.
Table No. 06. Projected AEO Product Offer with PDN

CANTIDAD DDE PRODUCCION

4 MESES AÑO
CANTIDAD KILOS CANTIDAD KILOS
PRODUCTOR 4.00 1,456.00 12.00 4,368.00
ASOCIACION 112.00 40,768.00 336.00 122,304.00
FUENTE: Elaboracion Propia.
It is considered that the PDN will have an evaluation horizon of 4 years where the
production of fattened cattle will be the same, 04 heads per campaign per member, a total
of 336 heads per year by the AEO.
2.2 DETERMINATION OF THE DEMAND-SUPPLY GAP
To determine the unsatisfied demand, we proceed to consider what was obtained in table No.
05, which is the projected demand for beef in the Arequipa region, subsequently with the data
obtained in table No. 04 of supply of beef in the Arequipa region, we proceed to project said
supply and identify the existing demand-supply gap.
Table No. 07. Projected demand for beef Arequipa Region

Beef in tons
Year
Offer Demand Surplus
2008 6,052.00 8,733.00 -2,681.00
2009 5,060.00 10,813.00 -5,753.00
2010 4,921.00 14,010.00 -9,089.00
2011 4,708.00 14,640.00 -9,932.00
2012 5,435.39 16,901.88 -11,466.49
2013 6,275.15 19,513.22 -13,238.07
2014 7,244.66 22,528.01 -15,283.35
2015 8,363.96 26,008.59 -17,644.63
Source: own elaboration based on data from:
MINAG – OEEE. Livestock Production and Poultry Industry 2011
Considering the information in table 06, it is specified that the AEO will produce for the year 2015
the quantity of 336 heads of fattened cattle, with an average weight of 364 kg, making a total of
122.3 tons of beef, which represents covering 0.69 % of the unsatisfied demand for the same
year of beef existing in the Arequipa region.
3. SURROUNDING ANALYSIS.
Our productive proposal environment is given by the macro-environmental and micro-
environmental guidelines and through the PESTA analysis, to determine the SWOT Analysis and
design strategies for the AEO.
3.1 MACRO ENVIRONMENTAL ANALYSIS.

At this level, the salient aspects of the Macro-environment will be analyzed for the business plan.
Methodologically we will use the PESTA analysis of social, economic, political, legal, technological
and environmental factors. The analysis of these factors will determine "opportunities" and
"threats" for the Business Plan proposal.
 Socio-cultural factors.
This factor allows us to know the demographic changes, and the cultural and social values
in the country, the population and its values represent the starting point for the debate on
market demand.
Under these parameters, population growth and cultural and social aspects within our
region are stable. Furthermore, local governments are promoting the opening of fairs that
generate greater dynamism within the regional economy. Even with these activities,

women are entering the market. giving value and spreading different customs, generating
dividends in society.
 Economic and Market Factors.

According to information from the Ministry of Economy and Finance of Peru, it will grow
this year slightly above 6%, highlighting internal demand that would grow around 7.5%
and the expansion of private investment that would be around 13%.
Likewise, in August, GDP grew 6.3%, with the non-primary sector standing out, growing
above 7.0% for the fourth consecutive month. For September, GDP growth was estimated
at around 6% due to greater domestic consumption of cement, which grew close to 20%;
the sale of family vehicles, which grew 22.5%; and bank credit to the private sector that
expanded by more than 15%. In addition, it should be noted that in the third quarter,
domestic demand would have grown close to 10%, and between January and September
private investment grew close to 15% and public investment grew by almost 30%.
On the other hand, the Regional Economic Activity Indicator (Cusco) for January-August
2012 showed an expansion of 3.5% in relation to the same period in 2011, mainly
explained by the increase in indicators related to the sectors: government services , and
agricultural.
In the same way, the growth in production of the livestock subsector, in August 2012, was
due to the greater production of milk and beef. Likewise, the increase in the accumulated
VBP was mainly explained by the greater production of milk and beef, as can be elucidated
in this BCRP table.
Table No. 08. Livestock product indices
Under this expectation with positive trends that have been managed within our country
and the Cusco region, an adequate climate of economic activity and economic stability;
which is vitally important to insert our product into this target market.
 Political Legal Factors.

The political - legal situation of agriculture is based on the political will to develop a
market economy model in Peru in a context of open economy. Within this framework,

private investment is promoted in the agricultural sector, with those actions related to the
main factor of agricultural production gaining importance: land.
Developing a land market implies, in Peru, overcoming the lack of a rural cadastre and the
incomplete land titling.
The purpose of titling is to facilitate access to formal credit, encourage investment in land
and, therefore, increase agricultural productivity and production. It is also possible that,
with property rights secured, farmers will become better stewards and adopt conservation
techniques.
Both parcelling and informal occupation have led to the vast majority of farmers in Peru
lacking formal property rights over their land: Figures from CENAGRO 94 indicate that only
24% of all landowners had registered and valid title.
 Technological factors.
Since the opening of the free market called “Social Market Economy”, the population has
access to technologies according to the demands of the demander and their purchasing
power; This generates greater ease for the individual in their activity and at the same time
opens new markets.
In this context, the level of investment in research and development by competitors
allows us to anticipate any changes in production processes based on technological
development or new products, generating higher levels of sales and income, keeping the
consumer increasingly more informed. where information becomes symmetrical and
reducing monopoly levels, thus generating greater dynamism in the economy.
 Environmental factors.
It is important to identify the problems of actions in the environment, that is, the impact
that production generates on the environmental conditions of the planet.
- Global warming.
- Water contamination.
- Climate changes.
- Transformation of forest areas into agricultural areas.
In this context, man's activity in order to generate monetary surpluses seeks to generate a
direct relationship between the increase in Technology and the reduction of
environmental preservation, which is an opportunity cost that man incurs with negative
externalities.
For this purpose, the analysis of the factors using the PESTA analysis allows us to find those
opportunities and threats that can be positive and negative influences on our business plan,
which is why we must identify these combinations of political, economic, and social factors. ,
technological and environmental, the priorities to then carry out the SWOT analysis in its phase
of opportunities and threats and their respective strategies to achieve objectives within the
business plan.
3.2 MICRO ENVIRONMENT ANALYSIS.

The self-diagnosis or so-called potential analysis is vital for the insertion of the association in the
global market, since it identifies the capabilities in the different stages of the trade process. One
way to start is to perform a self-diagnosis, asking the company's degree of satisfaction in the
marketing process. Succeeding in the regional market may be necessary to reach the national
market, but the producer's potential shows the association's ability to take advantage of local,
regional, or national market opportunities.

In this context, the micro environment identified by a set of characteristics, such as the behavior
of the association in the market (suppliers, competitors, clients and distributor) to which it is
immersed, the resources, processes and products, etc., that determines strengths and
weaknesses. It is important to consider the factors external to the association to take advantage
of finding the opportunities and threats in the market in which it has to be inserted.
 Competitive Market Structure.

Five forces will initially be evaluated (buyers, suppliers, potential competitors, substitute
products and rivalry present in the market) that will directly influence the business, its
actions and competitive responses, according to M's model. Porter. The result of this
analysis, together with the results of the market study, determines "opportunities" and
"threats" that the business must take advantage of and overcome, respectively, through
the strategy.
- The Bargaining Power of Buyers:
 Wholesale intermediaries, those who are few and buy in large quantities, can
at the same time change suppliers and buy from several at the same time and
have the advantage of paying in cash, making the buying and selling process
attractive.
 The bargaining power of final buyers who have decision-making power

regarding prices because they consume in small quantities.
 Transformers and distributors have high bargaining power in the purchasing

process for the simple fact of offering better purchase prices at a higher price
during times when the demand for this value-added product increases
(holidays and/or parties).
- Bargaining power of suppliers.
 To determine the bargaining power of beef suppliers, the actors in the

marketing process as suppliers of the product will be analyzed.
Family and family-commercial beef producers have greatly reduced bargaining
power since they relate to the market only through intermediaries, sell small
quantities and are not able to meet quality and consistency in supply. that
other actors in the marketing process demand.
Commercial producers have greater bargaining power since they do not have
a single buyer, they manage several channels and are able to meet the quality
and supply required by processors, wholesalers and distributors. However,
they direct their production to the transformers where they have competition
with the collecting intermediaries.
 Wholesale intermediaries have high negotiating power when selling due to

the volume they handle permanently and because there are not many of
them.
- Threat from potential competitors.

 Currently it is feasible to enter the beef market by raising cattle in the Cusco
region since there are no strong entry barriers that prevent the presence of
potential competitors.
 The only barriers that can be identified to enter the market are not having
one's own initial capital, contact with actors in the process and inadequate
knowledge about raising cattle.
- Threats of substitute products.
 Within competitive products, the producer does not have the power to set
the price since the increase in the price per kilo of beef will generate the
purchase of a greater quantity of another product such as chicken meat at a
low price.
 These competitive products called in this case mass consumption meat

products: such as poultry, beef, pork, etc. These first three lead the meat
market, being products that are frequently consumed, in this understanding
the decisional factor is mainly in the knowledge of its presentation and
preparation, taste, promotion and price.
 It can be concluded that per capita meat consumption has increased, but this
situation is exclusively due to the increase in the consumption of chicken
meat, the rest of meats maintain a static or negative trend in recent years.
Therefore, expectations remain stationary, the differentiation would be in the quality of

the product with the appropriate combination of the inputs and/or technologies necessary
for said activity and the achievement of a product according to market demands; which
will establish the strengths and weaknesses of said producer organization:
4. ORGANIZATION
4.1 LOCATION OF THE AEO.
Table No. 09
Department Cusco
Province Quispicanchi
District Quiquijana
Cc: Accopata, Usi, Huaraypata,
Address Huacaytaqui, Ccolca, Callacunca,
Quiquijana.
Cc: Accopata, Usi, Huaraypata,
Populated Center Huacaytaqui, Ccolca, Callacunca,
Quiquijana.
Does the populated center
No
belong to the district capital?
Is the populated center rural Rural

or urban?
NATIONAL MAP CUSCO REGION
PROVINCE OF QUISPICANCHI QUIQUIJANA DISTRICT
SCOPE OF INTERVENTION
WITH THE BUSINESS PLAN
Graph No. 02
Source: self made

4.2 COMPOSITION OF THE AEO BOARD OF DIRECTORS.
The AEO, Association of Livestock Feeders of the Vilcanota Valley, for its due participation in the
PROCOMPITE competitive plan is made up of the following board of directors:
Table N°10
Mother's last
Post Last name name Names ID
Demetri 2521066
President Ccama Lloclle o 0
2521268
Secretary Quispe Aguilar Luke 7
Euphemi 2521066
Treasurer Sovia Quispe us 0
4247070
Fiscal Yucra Alvarez Sunday 5
4227104
Vocal Flowers Santa Cruz Roger 7
Source: self made
 Data of the person with whom the communication must be made.

Table No. 11
Person with whom communication must be carried out
Names and surnames Rolando Kana Ccama
Av. 06 de Octubre s/n of the district of Cusipata,
Exact direction
province of Quispicanchi-Cusco
Cell phone 984-550515 or 978-648577
Email kana_ryr@hotmail.com
4.3 AEO PARTICIPANTS.

Association of Livestock Feeders of the Vilcanota Valley, is an organization made up of natural
persons, it is made up of 22 men and 6 women; The fact that this association has few women is
due to the fact that the woman cannot attend the meetings due to household activities, but
those who are immersed and dedicated to this activity are the women and the minors.
Table No. 12
Kind of person Number
Legal persons NO
Natural people Yeah
Men who integrate 22
Women who integrate 6
This table details the relationship of the members of the AEO, Association of Cattle Feeders of the
Vilcanota Valley, specifies the names and surnames, identity document and community or annex
to which they belong within this Vilcanota Basin.

Table No. 13
N
NAME AND SURNAME ID
o. SECTOR
2521066
1 Demetrio Ccama Lloclle Quiquijana 0
8019775
2 Nazaria Aquino Zuniga Quiquijana 9
4085416
3 Second Condori Aquino Quiquijana 9
2521202
4 Victor Challco Cansaya Quiquijana 6
4181211
5 Geronimo Yucra Quispe Accopata 5
2521037
6 Felipe Quispe Condori Accopata 6
2521066
7 Eufemio Sovia Quispe Accopata 0
2522276
8 Luis Quiñones Thupa Accopata 9
2521270
9 Manuel Navidad Valenzuela Vitorino Accopata 0
1 2521027
0 Valentina Qqero Vda of Huanca Accopata 3
1 2521666
1 Honorio Merma Gaspar Huaraypata 6
1 2521430
2 Wilfredo Florez Santacruz Huaraypata 0
1 2521409
3 Zenon Saire Quispe Huaraypata 3
1 2521287
4 Santiago Horcon Quispe Huaraypata 2
1 4227104
5 Rogelio Flores Santacruz Huaraypata 7
1 4684868
6 Pilar Huaman Ccama Usi 4
1 4582656
7 Cecilio Huaman Ccama Usi 3
1 4419902
8 Florentino Quispe Ccama Usi 0
1 2521993
9 Gregorio Quispe Paucar Callacunca 3
2 2521995
0 Eloy Pacco Vasquez Callacunca 6
2 8000859
1 Valentin Vera Condori Callacunca 3
2 2521192
2 Domingo Yucra Alvarez Colca 1
2 2521986
3 Lucas Quispe Aguilar Huaccaytaqui 5
2 4626831
4 Julio Cesar Huaman Cansaya Huaccaytaqui 0
2 2521207
5 Walter Fernandez Vilcahuaman Huaccaytaqui 9
2 Gertrudes Yucra Cansaya Huaccaytaqui 8019431

6 0
2 2521267
7 Juliana Huanca Quispe Huaccaytaqui 6
2 2521465
8 Manuela Huayta Leon Huaccaytaqui 0
Source: self made
4.4 PROFIT DISTRIBUTION STRUCTURE
At the AEO level, joint sales are proposed in order to give producers greater bargaining power;
but the distribution of profits is an aspect that will be determined based on the production of
each beneficiary; The production of 12 heads of fattened cattle is planned for sale by an
independent producer. The profits resulting from the business plan are received independently
by each producer based on the aforementioned aspect.
4.5 MEASURES TO AVOID MISMANAGEMENT OF AEO.
To promote transparency in the administration of AEOs, certain measures are proposed to

help this end.
Table N°14
Is fulfilled
Situation
(Yes or No)
Periodically inform natural persons or shareholders of the situation of the AEO Yeah
Inform the amendments to the statutes that are carried out Yeah
Periodic rotation of the board of directors Yeah
Partners or natural persons must have the right to call a board meeting whenever
Yeah
they see fit.
Partners or natural persons must be treated equitably. Yeah
4.6 AEO ORGANIZATION CHART

The AEO “Association of Cattle Fatteners of the Vilcanota Valley” has as its highest authority the
board of directors made up of the president, secretary, member and prosecutor; Lastly, the 28
members of this organization according to this diagram.
Graph N°03
AEO
PRESIDENTE
SECRETARIO TESORERO VOCAL FISCAL
SOCIOS DE LA AEO.
FUENTE: Elaboracion Propia

5. BUSINESS PLANNING
Each of the members of the Vilcanota Valley Livestock Feeders Association has areas of cultivated
pastures as well as land available to expand the installation of improved pastures in an average
area of 1/3 of hectares and they also have livestock. beef of the same biotype for fattening that is
obtained from the livestock stands, fairs in the province of Canchis such as: Combapata, Tinta or
Sicuani; The fattening process begins precisely with the acquisition of the cattle, and then the
dosage (deworming) is carried out, in order to eliminate ectoparasites and endoparasites, later the
administration of vitamins is carried out in order to stimulate the appetite in the specimen. and
they are provided with concentrated balanced foods based on local products (bran, corn flour),
combining them with vitamin supplements, protein sources (fish meal) as well as provision of
improved pastures for a period of 4 months housed in the appropriate sheds. for fattening activity;
of course with adequate technical assistance from the qualified technical staff of the Economic
Development Sub-Management of the District Municipality of Quiquijana; to then develop the
commercialization of livestock in live weight in the regional market through intermediaries, in the
livestock platforms.
In this context, its sole purpose is to satisfy the needs and demands of our potential applicants,
characterizing us by their price, weight and presentation of the animal, generating sustainable
employment and social responsibility. Achieving coverage and positioning at the local and regional
level.
5.1 BUSINESS OBJECTIVES
 General objective.
- Increase the family per capita income of the association immersed in the Business
Plan, to contribute to improving their level of quality of life.
 Specific objectives.
- Improve the technological level of production, management and fattening of cattle

for subsequent commercialization.
- Increase the levels of productivity and competitiveness of cattle for marketing.
- Generate additional surpluses for producers.
- Increase the supply and quality of live cattle for the local, regional and national
market.
- Carry out commercial articulation at fairs within your jurisdiction.
- Strengthen the organization of beef producers with knowledge of business
organization and management.
- Raise the self-esteem of the Organization's partners, enabling counterpart economic
capital from the Local Government - PROCOMPITE.
- Contribute to the development of the District with employment generation: direct
and indirect, in participating family units.
5.2 SWOT ANALYSIS.
 Strengths.
- Organization of agricultural producers committed to undertaking this activity.
- Availability of land for planting improved pastures.
- It has water for irrigation.
- Production experience in cattle management at a basic level.
- Predisposition of the partners to grant the compensation.

 Opportunities.
- Political, Economic and social stability.
- The agricultural sector has positive and ascending macroeconomic indices.
- Economic growth with positive expectations.
- Greater foreign private investment.
- Opening of new markets (Free Trade Agreements, Interoceanic)
- The customs of the inhabitants of the mountains, which include the consumption of
beef, increase.
- Existence of a Land Law in the process of development, which will generate a new
framework of opportunities for landowners.
- Existence of public sector programs that promote livestock fattening.
- Existence of programs that finance productive activities such as Law No. 29337 -
PROCOMPITE
 Weaknesses.
- Inadequate knowledge of the beef market.
- Lack of knowledge of technical aspects in beef cattle fattening.
- Poor implementation with productive infrastructure and tools.
- Unplanned production.
- They do not have enough capital to undertake.
- Weak development of commercial articulation processes.
- Inadequate productive infrastructure: stables, sheds.
 Threats.
- Some key aspects for greater accessibility to beef cattle production have not been
determined.
- A higher percentage of families in the capital Lima reject this product as part of their
basic family basket.
- A smaller percentage of the population of the mountains has property titles to their
lands.
- The weather situation: Frosts and gales that occur between the months of May and
August.
- General migration of ranchers due to lack of employment in the area.
- Interoceanic Brazil meat
- Diseases
 FO strategies.
- Increase the volume and quality of the product for the market.
- Association established which gives confidence to financial institutions for granting
credit.
- Strengthen the association of producers who have initiatives and manage support for
existing programs and projects.
 DO Strategy.
- Improve knowledge of the meat market by AEO members, taking advantage of the
support of existing projects
- Improve income and knowledge through institutions that are interested in providing
technical assistance and articulation to the market.
- Existence of financial entities to have equipment and tools for adequate production.
 FA Strategy.

- Disease prevention through constant monitoring, with support from institutions

- The association has farmland and a good climate, so they would easily switch to
another sector if demand falls.
 DA Strategy.
- Plan production and counteract the possible supply of meat from Brazil
- Increase the assistance capacity involved in the cattle fattening process.
- Overcome organizational deficiencies.
5.3 STRATEGIC ALLIANCES AND BUSINESS OPPORTUNITIES.
Table No. 15
Descripción de la alianza Característica de La alianza u

Empresa u
estratégica u oportunidad de Finalidad la empresa u oportunidad ¿Es
organización
negocio organización probable o concreta?
1. MUNICIPALIDAD DSITRITAL DE Cofinanciamiento
Organización Publica Concreta
QUIQUIJANA y Soporte Tecnico
3. ACOPIADORES MAYORISTAS DE
Comprador Empresa Privada Probable
COMBAPATA
4. RED DE PRODUCTORES DE
Fortalecimiento
ENGORDE DE GANADO VACUNO DEL Organización Privada Probable
Organizacional
DISTRITO DE COMBAPATA
6. OPERATIONAL PLAN
Within the operational plan to be considered by the Association of Beef Fatteners of the Vilcanota
Valley, District of Quiquijana, Quispicanchi - Cusco, once the Business Plan called “Improvement of
the Production of Beef Cattle for Fattening, of the Vilcanota Valley” has been presented. , District
of Quiquijana, Quispicanchi, Cusco”, to the PROCOMPITE - Quiquijana contest we will have in
advance our very solid organization against the negative externalities that could generate
distortions within this activity and against the existence of market failures such as asymmetric
information and the existence of monopolists and oligopolists in purchasing inputs and selling our
final product.
6.1 OPERATIONAL REQUIREMENTS OF THE AEO.

Once the favorable results of the PROCOMPITE – Quiquijana competitive plan have been obtained;
The ASSOCIATION OF FATTENERS OF THE VILCANOTA VALLEY will increase their production and
productivity through the implementation and construction of sheds appropriate to the area and
installation of improved pastures of Alfalfa, Oats and Red Clover, complemented with technical
assistance in monitoring the weight of the livestock. , deworming, application of vitamins and
determination of weight for sale.
Regarding marketing deficiencies, the strategy of searching (as a producer) for the final
intermediary in the Lima market will be applied, managing to sell our product at considerable
prices.
Table No. 16
Improvement of the product or service: Clarify the aspects in which the requested co-
financing will improve the product.
1. It will increase the level of productivity and competitiveness.
2. It will improve feeding levels through the implementation of improved pastures in an area
of 1/3 of a hectare per producer.

3. There will be adequate conditions for productive shed infrastructure.

4. Eliminate the greatest number of intermediaries, using a single intermediary who inserts
us into the Lima market.
Technical assistance and/or training required: The AEO requires technical assistance and/or
specific training in:
Table N°17
Technical Assistance/Training To improve the process of:
1. Sanitary management Improve animal health
Development in the shortest time and at the
2. Feeding management
lowest cost
3. Weighing control Commercialization.
4. Food production Feeding and reducing production costs.
5. Facility management Cattle breeding.
Resolution of production and marketing problems: Difficulties in the production and/or

marketing of the product or service and how they are planned to be solved.
Table N°18
Difficulties Solution found
Producers with welfare attitudes. Sensitization
Production of traditional foods. Mechanize production
Low productivity levels. Training
Market failures. Training
6.2 TECHNICAL EXPLANATIONS AND PRODUCT DESIGN
The Association of Livestock Fatteners of the Vilcanota Valley, of the district of Quiquijana, has as
its main activity the fattening of cattle, they have initiative as entrepreneurs in this area, which is
why they present this Business Plan to the PROCOMPITE fund of the District of Quiquijana , in
order to access funds intended to improve their production, productivity and competitiveness,
for this purpose within the techniques and design of the product to consider are:
 Implementation and construction of productive infrastructure or sheds.

 Installation of improved grasses such as Alfalfa, Rye Grass, oats and red clover; For
better development of the pastures, it will be complemented with organic fertilizers
produced from cattle manure, among others.
 Personalized technical assistance (per producer).
For this purpose, the feeding process for cattle is also taken into account to obtain a product with
the appropriate weight at the end of the cattle fattening period, which will last 4 months.

Graph N°04
PROTEINAS
ENGORGE
DE
GANADO
AGUA
MINERALES
Source: self made.
Once the entire production process has been carried out in terms of fattening cattle for meat, it is
possible to obtain the final product on average over 4 months to be able to send it to the market
(livestock boards of Combapata) and through intermediaries to the Arequipa market and which
They will be our potential plaintiffs.
6.3 DEFINITION OF THE PRODUCTION PROCESS.

The productive process of the business plan “Improvement of the Production of Fattened Beef
Cattle in the Vilcanota Valley, District of Quiquijana, Quispicanchi, Cusco” of the Association of
Livestock Feeders, is detailed through the explanation of a diagram and its due support of each of
the stages within the production process.
DIAGRAM OF THE CATTLE FATTENING PROCESS.

Graph N°05
ADQUISICION DE GANADO VACUNO (TABLADA GANADERA DE

COMBAPATA)
PESADO
ALIMENTACION BALANCEADA
DESPUENTE DE
DOSIFICACION
VACUNAS
APLICACION DE VITAMINAS Y
MINERALES
GANADO CON
364 KILOGRAMOS
TRANSPORTE
COMERCIALIZACION
FUENTE: Elaboracion P ropia.
6.3.1 General characteristics of the production process.

The production system that will be used is semi-intensive breeding, that is, the animals will
remain confined in the sheds and will be taken to graze in fields on occasional occasions,
throughout the fattening process that will last 04 months, a process that will allow a proper use
of different resources and meat production.
The raw material will be Brown Swiss cattle and Creoles crossed with Brown Swiss, the Creole
cattle being characterized by their rusticity, adaptation to the environment and their use of
dual purpose (meat, work), it has no degree of crossbreeding with other breeds, it is
also called typical Peruvian cattle.
6.3.2 Characteristics of the acquired animals.

When purchasing fattening cattle, the following characteristics will be taken into consideration:
 Type of livestock .

In this business plan it is intended to use the existing livestock capital in the area, which
will be Brown Swiss cattle and criollos crossed with Brown Swiss.
 Age.
The most suitable cattle for fattening are those whose ages range between 18 - 48
months of age (animals with 2 - 4 permanent teeth), these being the most efficient
animals to convert food into meat.
 Sex.
Whole male animals will be fattened, because they obtain better yields when fattened.
 Weight.
The initial weight of the animal influences the results at the end of fattening, so it will be
recommended that the initial weight range between 150 - 170 kg, but in our case, for
proper management, a cattle of 364 kg is expected.
 Conditions of the animal.
Physically and clinically healthy animals will be used, choosing animals with greater bone
structure, tall and thin that respond better to fattening, that produce good yields and
the product is EXTRA and FIRST quality meat.
6.3.3 Productive process.

a. Livestock management program.
The main management operations to which a cattle is subjected during the fattening period
are intended to prevent, control and evaluate the performance of the animal during the
fattening process.
Acquisition of cattle.
They acquire it from the Combapata cattle ranch; handling at reception upon arrival, the
animals will be verified and inspected for body and health appearance and the
corresponding purchase records and the following livestock tasks will be carried out:
 Heavy
It is the first operation that will be performed on the cattle upon their arrival at the
productive infrastructure or sheds. The animals upon reception will have a rest time to
reduce the stress of the trip, then they will be taken to the scale for their initial
weighing.
This data is very important to determine weight gain during the fattening period and
record adequate control throughout the process.
 Pointing of horns.
It will be carried out on all animals, cutting the tips using a metal saw. This operation is
carried out to avoid accidents caused by fights between them and the personnel in
charge of handling the animals.
 Dosages.
Elimination of endoparasites that influence production.
 Vaccines.
All animals will be vaccinated against foot-and-mouth and carbonaceous disease, given
its mandatory nature in the country.
 Application of vitamins and minerals.
It is the application of products that promote the use of food and improve the level of
weight gain in less time.
b. Management during fattening.
 Everything related to management at this stage refers to food and health.
 The feed will be distributed constantly, seeking maximum consumption per animal.
 Consumption on average of 3 – 4% of their live weight of DM.
 Provide fresh, clean water constantly. The average water consumption of fattening
cattle is 40 – 50 liters/animal.

 Provide an adequate area of shade for each animal. Weighings will be established 30
and 60 days after the animal is admitted, evaluating its performance.
 Observe the pattern of food consumption. Feeding the animals at levels of 12 – 13.5%
protein and 0.7 – 0.9 Mcal/Kg.Eng.
 Permanent and constant observation of the health status of the animals. If a health
problem occurs, isolate and treat the sick animal.
6.3.4 Feeding program.

a. Feeding system.
The feeding of fattening cattle will be based on green and concentrated forage; The food will
be supplied in the stable, however there is the possibility of using grazing with an adequate
pasture rotation system and supplying a good amount of good quality forage at the lowest
possible cost with due technical assistance.
The protein content of the ration depends on the growth potential of the animals, which is
related to age. Younger cattle require rations with a higher protein concentration (14 – 15%)
than adults (12 – 13%).
The concentrates will be based on Corn, Fishmeal and milling byproducts.
b. Fodder installation.
Considering the food source of the animals for the project, Alfalfa, Rye Grass, oats and red
clover will be installed, whose extensions are calculated based on the number of animals
supported per hectare/year, the daily consumption requirements of each animal, the same In
this way, the number of paddocks is calculated for an efficient rotation in the cuts of annual
forages, perennial grasses and thus obtain optimal regrowth of the grass.
c. Commercialization.
It will be transported to the livestock tablada of the Combapata district, and in cases to the
CAYLLAPAMPA – Quiquijana livestock tablada which takes place monthly; those animals that
have already completed the fattening process, which lasted approximately 120 days.
The project aims from the beginning to provide a constant quality of meat to the Lima and
Arequipa markets and in exceptional cases to the Cusco market, with a good number of
heads, which determines having a weight of over 364 kg of carcass meat from each fattened
bull. .
6.4 BUSINESS LOCATION.
The Quiquijana District has 18 peasant communities and 6 annexes; where the population of the
district amounts to 10,340 inhabitants (CPV 2007 – INEI), with an intercensal population growth
rate of 0.36%, with the urban growth rate being 0.52% and the rural growth rate being 0.33%,
which clearly shows us the growth of the urban population in greater proportion to the rural
population, in this context the present intervention through the PROCOMPITE – Quiquijana
business plan will be located in the peasant communities of Ccolca, Accopata, Huacaytaqui, Usi,
Huaraypata, Callacunca and Quiquijana. For this purpose, the AEO is made up of a total of 28
producers, of which 6 producers from the farming community of Huacaytaqui, 6 from Accopata, 5
from Huaraypata, 4 from Quiquijana, 3 producers from Callacunca, 3 from Usi, and one from
Ccolca.
In the following graph we can locate within the location sketch.

Graph No. 06
Once the present productive proposal that will be developed in the Association of Fatteners of
the Vilcanota Valley has been identified; through the construction of sheds complemented by the
planting of grasses and technical assistance; located 2-3 km. of the Cusco-Sicuani highway, in the
communities of the “Association of Livestock Feeders of the Vilcanota Valley of the
Quiquijana district, province of Quispicanchi-Cusco” , it is worth mentioning that these
geographical spaces meet the necessary conditions that allow greater net benefits to be
obtained. and lower production costs, taking into account the following criteria:
 Proximity of raw materials

This area has adequate accessibility to raw materials and low cost, since it is located 2 to 3
kilometers from the Cusco-Sicuani highway, which is a determining factor in the choice of
location.
For our project, this factor represents cost reduction in terms of transportation of inputs
and the final product.
 Location with respect to the consumer market

The location of this business plan with respect to the market is easy to access due to
having a paved road to the market and/or weekly fairs such as (Sunday fair of Combapata,
Tinta, Sicuani), livestock platforms in the district of Quiquijana (Ccayllapampa) , among
others. The highest percentage of potential demand is located and destined for the
province and capital of the Cusco region, and the lowest percentage is select quality meat
for the Arequipeño market through intermediaries.
In this context, this positive externality that exists with respect to the potential market
gives rise to the minimization of costs in terms of the transfer of the product, which will
allow us to obtain higher levels of profit.
 Transportation service availability

The existing access to the place of location of our productive proposal with respect to the
consumer market and/or inputs is easy to access, this distance with respect to the place of
intervention allows us to reach the market in a timely manner, at the same time it allows
us to minimize transportation costs. since the travel time between the location and the
consumer market and/or purchase of inputs is approximately one and a half hours.
 Climate conditions
The product of our business plan through the fattening of Brown Swiss cattle and criollos
crossed with Brown Swiss is adapted for this Andean and valley area specifically according

to the studies carried out by the Ministry of Production, which allows us to have
comparative advantages. compared to another close competitor.
 Labor availability
We can mention that in terms of the availability of both qualified and unskilled labor, it is
favorable for said intervention, given that in the area there are experienced technicians
from the Sub-Management of Economic Development of the local government of
Quiquijana, as well as unskilled labor by entrepreneurial producers to obtain additional
surpluses by dedicating themselves to this activity.
 Environmental factors
Within the environment of the present intervention, the construction of sheds and the
planting of improved pastures will not generate environmental impact problems that
could harm the development of society; they are insignificant, if there is any externality,
they will have to be compensated in a timely manner; Furthermore, the externalities that
this activity could generate are more positive than negative since with the intervention of
this plan the preservation of the environment would be sought.
In this context, the present intervention through the Improvement of the Production of Beef
Cattle for meat of the Brown Swiss breed and criollos crossed with Brom Swiss , the Association
of Livestock Fatteners of the Vilcanota Valley of the district of Quiquijana, province of
Quispicanchi-Cusco , is supported In ALFRED WEBER's theory of industrial location, which
considers distance as a basic location factor that seeks to minimize costs, it also takes into
account the origin of the raw material (M1 and M2), market. In this case, accessibility to technical
assistance and improved pastures and other complementary inputs and a nearby consumer
market with the aim of obtaining higher levels of surplus.
Graph No. 07
M1
MARKET Location of the

intervention.
M2
Source: self made.
7. MARKETING PLAN

7.1 MARKETING OBJECTIVES.

Among the objectives that we wish to achieve to achieve the sustainability of our plan by
Improving the Production of Beef Cattle for meat by fattening Brown Swiss breed cattle and
criollos crossed with Brown Swiss we have:
Short term objectives:

 Increase in net worth, income and assets by 15%
 Cover 2 % of the effective demand of the target market.
 Channel a link with a collector in the city of Lima that offers our produced product at
better prices.
Medium-term objectives:
 Increase in the net value of production and income by 15%
 Improving product competitiveness through constant improvements throughout the
production process.
 Increases in the level of competitiveness of beef cattle fattening in the annex with a view
to entering competitive markets such as that of the city of Lima.
7.2 TARGET MARKET.

The marketing criterion is through market segmentation chosen to define the target market of
the business, which is geographic segmentation given that the beef product line belongs to the
group of basic mass consumption products that are consumed locally, regionally and national.
The productive proposal is geographically located in the communities of Pataqquehuar and
Ñañuran in the district of Quiquijana, Province of Quispicanchi - Cusco, and constitutes a business
initiative organized for the fattening and marketing of cattle fed with cultivated and improved
pastures and using supplements, to improve the finishing time of the animals to be fattened with
due technical assistance and rearing in sheds, as a consequence, healthy fattened animals will be
obtained without the use of protein of animal origin with the use of fish meal. And due to the
location of the economic corridor, the target market of the project is in the Canchis Province,
with wholesale buyers from the city of Arequipa being buyers.
Animals will be marketed in optimal conditions of age, adequate weight and fat distribution.
 Animals with lean meat, that is, with a low fat content and of excellent quality, young
animals with tender meat of one or two years of age.
 The cattle to be used will be the typical Brown Swiss cross criollo, which is characterized
by its low precocity and low performance of the criollo cattle.
 At the end of the intensive fattening process, they weigh between 364 kg. of carcass
weight.
 Good quality meat.
7.3 PRODUCT.
The “Association of Livestock Fatteners of the Vilcanota Valley of the Quiquijana
district, province of Quispicanchi-Cusco” , produces and markets fattened cattle for benefit;
guaranteeing the productive offer and product quality. Among which it has characteristics such
as: the product to be offered consists of fattened cattle with the following characteristics:
 Age: 1 to 2 years old:
 Fattened animals are offered whose price depends on the weight gained in the fattening
process, with an average price of S/. 3,500.00.
7.4 PRICES

To meet the objective of obtaining a greater share in the market, the ASSOCIATION OF
LIVESTOCK FATTENERS OF THE VILCANOTA VALLEY OF THE DISTRICT OF
QUIQUIJANA, PROVINCE OF QUISPICANCHI-CUSCO , will offer its quality products
and services in comparison to the competition, offering a livestock beef for meat with good
weight, fiber and presentation; for this purpose the decision to position quality animals. It implies
that the producer association will have to charge a comfortable price; The price will depend on
the live weight of the animal and breed, Creole and Brown Swiss crossbred beef will be sold on
average 364 kg for sale, with an average price per kilogram above 9.00 nuevos soles; This, in the
best of cases, identifies the Lima market, which is our potential demand.
7.5 PROMOTION AND PUBLICITY

As the producers will be dedicated solely to fattening cattle, producing 3 times a year and in
order to position themselves in the local and regional market, whether they are destined through
intermediaries for consumers in Arequipa, these producers will use the strategy of participating
in agricultural fairs such as “Feria Regional of Yanacocha – Quiquijana” in the month of August
and at the Ccayllapampa livestock arena every last Friday of the month, among other exhibition
fairs and organizing and participating in hammer auctions, in this way the association will be
promoted and increasing the expectation of having potential clients.
On the other hand, as producers we will seek to contact the intermediaries of the Lima market in
the Combapata livestock platform to be able to sell jointly in quantities at prices above the
regional market.
7.6 SQUARE
The members of the association as producers of this sector have as their target market the
Combapata cattle ranch, where they will offer their products to intermediaries in the area,
Arequipa and Lima; For which the producer will intend to sell his products to intermediaries in
Arequipa and Lima who will demand high prices. On the other hand, they will have set dates to
be able to offer their product on the weekly boards of Combapata, Tinta and Sicuani.
7.7 POSITIONING
Having made a brief analysis of the potential market, where what they demand is quality and
volume. The product should be positioned as: “Healthy and well-behaved cattle” nutritious meat
for mass consumption, meat from improved Brown Swiss cattle and Creoles crossed with Brown
Swiss from the ASSOCIATION OF CATTLE FATTENERS OF THE VILCANOTA VALLEY
OF THE DISTRICT OF QUIQUIJANA, PROVINCE OF QUISPICANCHI-CUSCO” , fed on
natural grass, green forage and concentrate rich in proteins and with optimal technical
assistance; raised in sheds, resulting in quality and nutritious meat, a symbol of quality and
cleanliness.
That image of healthy and nutritious livestock must be in the minds of our future buyers.
7.8 DISTRIBUTION
Our product will be directed to the markets of the Arequipa region, therefore the design of the
marketing channel will be directly through an intermediary for sales purposes at the Combapata
Sunday fair.
And indirectly to the market of the regional fair of Yanacocha – Quiquijana and the monthly
tablada of Ccayllapampa for the benefit of the final consumer.
The marketing channel will be the following:

Production channel with intervention of an intermediary. Indirect

Referred channel where the product to be sold will be to the intermediaries and these to the
Channels and final consumer; This type of marketing channel, as producers, generates negative
expectations for the simple fact of selling at a low price.
PRODUCER INTERMEDIARY MARKET CONSUMER
Direct marketing channel.

Where as a producer it will be our paradigm to follow, in this way we can break market failures
due to the existence of asymmetric information and barriers of monopolists and monopsonists;
managing to generate greater income from the sale of the product for the producers and this
generates an incentive and positive externality directly to the producer.
PRODUCER CONSUMER
 Analysis of the competition.

As for the competitors of the product in the Sunday fair of the Combapata district, countless
producers, producer associations or individual producers from the towns of the Cusco
region participate, to offer their livestock from offspring, bulls, beef cattle, among others;
For this purpose, our product to be offered will be 364 kilograms of carcass on average once
the productive proposal is implemented with co-financing with PROCOMPITE resources,
producing in four months.
8. GENERAL FEATURES
8.1 ENVIRONMENTAL IMPACT PLAN

Within the framework of the Environmental Asset Safeguard Policy promoted in the last decade
at the national level, in the case of the productive proposal, the application of environmental,
social and cultural evaluation instruments is proposed to analyze the corresponding
environmental impact.
a. Typology of the proposal profile (instrument 1)

The profile of the productive proposal is considered within the group of Agricultural Rural
Activities (ARA) as an agricultural activity with its respective environmental components.
Table N°19. Profile typology of the Productive Proposal.

Rural Environmental Components
Agricultural Physicists Biological Socioeconomic Cultural
Activities Quality of
(ARA) Floor Water Flora Fauna Income life Knowledge Tradition

Plot of cultivated Production and

Livestock pasture cattle fattening marketing Traditional breeding
Source: self made.
b. Environmental categorization (instrument 2)
Based on the table of environmental categories, it was determined that the proposal is within
environmental category A, which corresponds to projects in which no adverse effects on the
environment are anticipated, therefore not requiring environmental mitigation measures.
c. Exclusion list (instrument 3)
It is confirmed that the type of productive proposal corresponds to environmental category A,

according to the exclusion list table, which is the second filter with which this proposal was
analyzed, confirming its categorization.
d. Checklist (instrument 4)
As the profile passed the exclusion list, it was submitted to the environmental checklist to
outline the possible impacts of the productive proposal, determining that it does not generate
harmful impacts on the environment in four main aspects as can be seen in the following
tables:
Table N°20
Name of the Productive Proposal
IMPROVEMENT OF CATTLE PRODUCTION OF THE ASSOCIATION OF CATTLE FATTENERS,

DISTRICT OF QUIQUIJANA, QUISPICANCHI, CUSCO
Verify the development of the following instruments

Environmental Checklist But Because?
Environmental impact assessment matrix But Because?
It doesn't
Mitigation Plan But happen
It doesn't
Environmental Monitoring Plan But happen
Maximum Score
Diagnosis 20 18
1. Production system of the good or service 5 3
2. Changes in the production system with the PDN 9 7
3. Alternative 3 3
4. Technology and local environmental offer 3 5
Description 20 19
5. Location of the PDN 4 4
6. Access 4 4
7. PDN size 4 3
8. Proper use of land 4 4
9. Risks 2 2
10. Environmental standards 3 3

Identification of environmental impacts 20 20

11. Exclusion List 3 3
12. Environmental impact assessment matrix 3 3
13. Coherence of the Environmental Mitigation Plan 5 5
14. Adequacy of the Environmental Mitigation Plan 4 4
15. Identification of possible impacts 2 2
16. Field evaluation report 2 2
17. Environmental limitations 1 1
Impact mitigation measures 20 20
18. Forecast of mitigation measures 5 5
19. Planning of mitigation measures 4 4
20. Approach to mitigation measures 4 4
21. Approach to compensation measures 4 4
22. Remedial measures 3 3
Monitoring measures 20 19
23.Environmental monitoring plan 3 2
24. Monitoring indicators 2 2
25. Schedule 5 5
26. Monitoring Plan Cost Estimate 5 5
27. Training needs 5 5
TOTAL 100 96
Based on the environmental evaluation form and the PDN qualification criteria, it achieves a
high score, which is why it is declared that it is prioritized, and that its environmental mitigation
plan is basically adapted to organic waste management practices, because it does not involve
increased risk of environmental contamination l.
9. INVESTMENT AND FINANCING PLAN
9.1 JUSTIFICATION OF CO-FINANCING
Given the inadequate conditions of production and fattening of cattle in our association and the
desire to undertake this activity in our Qquehuarmayo Microbasin and the identification of the
comparative advantages for this sub-sector, we consider that the search for co-financing through
this is of great importance. half. In this sense, the following table explicitly explains the positive
externalities that could be generated once co-financing is obtained.
Table N°21
It is considered that the requested co-financing will help reinforce the following aspects
1. Improve productive infrastructure to increase production and productivity.
2. Lower production costs and increase profit margins by channeling marketing.
3. By having exclusive facilities for this breeding, the productivity of our specimens increases to
above 364 kg per cattle.
4. The intensification of breeding will contribute to the productive specialization of each partner,
producer, reducing mortality rates, implementing better management, control and preventive health.
5. They will generate positive externalities in terms of cattle production and increase the kilos per

cattle.
On the other hand, the problems of market failures in the face of asymmetric information
regarding the sale of our fattened bull product will be reflected in the reduction of these, due to
obtaining a quality cattle product and in accordance with the standards required by the potential
plaintiff.
9.2 IMPROVEMENT OF THE PRODUCT OR SERVICE.
The activity of fattening cattle that is practiced in the association has good potential due to the
climate, agricultural land with sufficient water for the production of pastures and mainly due to
easy access to communication routes (purchase of balanced feed , veterinary medicines and sale
of animals) due to its proximity to local and regional markets.
However, despite the important and potential activity, the families that are dedicated to
fattening cattle, the beneficiaries of said association have not yet solved their problems of
economic income and therefore their quality of life. In this sense, the productive proposal seeks
to help increase productivity based on the live weight gain of cattle and the number of heads that
are fattened and destined for the market.
The construction of sheds for cattle will improve the productivity and profitability of each
producer.
Given the expectation of PROCOMPITE – Quiquijana; The association of producers of the

Vilcanota Valley aims to solve the following:
Table No. 22
Difficulties Solution found
1. Inadequate production infrastructure. Construction of cattle sheds for fattening
Strengthening the Association, in order to carry out
2. Marketing individually
joint marketing.
Technical Assistance in the cattle fattening
3. Poor application of practices in the fattening of cattle.
process.
9.3 TECHNICAL ASSISTANCE AND/OR TRAINING REQUIRED
The central strategy proposed is the productive chain approach, which is to access training
services, technical assistance, generation and transfer of new knowledge and reduction of
production and marketing costs.
The approach has an impact on the development of capacities, facilitating the generation of
new knowledge through a process of peasant inter-learning, carrying out training events, and
technical assistance visits that contain demonstration actions.
The intervention strategy focuses with greater interest on the development of this component,
seeking techniques and ways to pre-fatten cattle in less time with greater daily live weight
gains, promoting the process of social and organizational interlearning to take advantage of

resources. local activities that contribute to the sustainability of the subsector; for this purpose,
a series of activities have been carried out, which are detailed below.
In order to increase our Productivity and Competitiveness
Table No. 23
ACTIVITY TO IMPROVE THE PROCESS OF
1. Technical Assistance in
- Production, previous results of the experience, goals sought, generation of
initial weighing and deworming of
reflections on private investment.
fattening cattle.
2. Technical Assistance in vitamin - The administration of vitamins fulfills the function of stimulating people to
administration. eat more forage and helping them better assimilate the forage that is supplied.
3. Technical Assistance in anabolic - The administration of anabolic plays the role of helping to complete the
administration. formation of muscle mass in fattening cattle.
- Determination of the daily live weight increase, so that the producer

4. Technical Assistance in confirms the results of his work and makes the decision if it really justifies
final weighing of fattening cattle doing controlled technical fattening in less time.
- Determine the marketing price according to its live weight.

5. Technical Assistance
- Improve the provision of fresh green forage as a complement to the diet.
Installation of Improved Pastures
9.4 INVESTMENT PLAN AND OPERATION AND MAINTENANCE COSTS
9.4.1 Total investment required for the PDN
The total investment of the Business Plan is. S/. 198,199.11 (One Hundred Ninety-eight
thousand, one hundred ninety-nine and 11/100 Nuevos Soles).
Within which an investment of 23.26% on the part of the beneficiaries is considered, amounting
to S/. 46,097.69 and co-financing is sought for an amount of S/. 152,101.42, which represents
76.74% of the total amount, which is expected to be assumed by the local government through
the PROCOMPITE competitive funds.

Table N° 23 Total investment needed by the PDN

1. COSTOS FIJOS
MONTO FINANCIADO POR MONTO FINANCIADO INVERSION

DESCRIPCION UNIDAD CANTIDAD PRECIO REFERENCIAL
LOS AEOs (S/.) POR EL GL (S/.) TOTAL (S/.)
ALAMBRE NEGRO # 16 KG 372.12 4.50 0.00 1,674.54 1,674.54
CLAVOS PARA MADERA CON CABEZA DE 2" KG 84.00 4.80 0.00 403.20 403.20
CLAVOS PARA CALAMINA KG 127.68 7.00 0.00 893.76 893.76
ACERO CORRUGADO fy=4200 kg/cm2 GRADO 60 KG 3955.28 3.29 0.00 13,012.87 13,012.87
ARENA FINA M3 14.84 149.00 0.00 2,211.16 2,211.16
BARRO PREPARADO M3 43.40 4.00 173.60 0.00 173.60
BARRO PREPARADO CON PAJA M3 24.64 4.20 103.49 0.00 103.49
PIEDRA GRANDE DE 8" M3 391.44 25.00 9,786.00 0.00 9,786.00
PIEDRA MEDIANA DE 4" M3 88.48 25.00 2,212.00 0.00 2,212.00
PIEDRA GRANDE DE 6" M3 10.64 25.00 266.00 0.00 266.00
SUMIDERO CROMADO DE 3" UND 28.00 5.00 0.00 140.00 140.00
ADOBE 0.40 X 0.30 X 0.15 m UND 27695.36 0.40 11,078.14 0.00 11,078.14
CEMENTO PORTLAND TIPO IP (42.5 kg) BLS 851.48 25.00 0.00 21,287.00 21,287.00
YESO DE 56 Kg BLS 50.40 8.50 0.00 428.40 428.40
LACA DESMOLDEADORA gal 6.16 115.00 0.00 708.40 708.40
HORMIGON DE RIO M3 175.56 80.00 0.00 14,044.80 14,044.80
MADERA CORRIENTE P2 3151.40 2.40 0.00 7,563.36 7,563.36
MADERA EUCALIPTO ROLLIZO Ø 5" x 8.00 m. PZA 28.00 38.00 1,064.00 0.00 1,064.00
REGLA DE MADERA P2 42.84 2.60 0.00 111.38 111.38
MADERA ROLLIZO PAR MODILLO Ø 5"x5.08m @ 0.90m UND 280.00 15.00 4,200.00 0.00 4,200.00
CORREAS DE MADERA (3"x2"x26 1/4') UND 196.00 40.00 0.00 7,840.00 7,840.00
VIGAS DE AMARRE (5"x4"x 26 1/4') UND 56.00 20.00 1,120.00 0.00 1,120.00
TRIPLAY DE 6 mm PARA ENCOFRADO PL 13.16 49.00 0.00 644.84 644.84
CALAMINA GALVANIZADA 11 CANALES 1.80x0.80x0.21mm PL 1064.00 20.00 0.00 21,280.00 21,280.00
HOJA DE SIERRA UND 37.52 5.00 0.00 187.60 187.60
CODO PVC SAL DE 3" X 90° UND 28.00 2.50 0.00 70.00 70.00
TUBERIA PVC SAL 3" M 28.00 16.00 0.00 448.00 448.00
TRAMPA P PVC SAL 3" PZA 28.00 17.50 0.00 490.00 490.00
CORDEL RLL 88.76 15.00 0.00 1,331.40 1,331.40
HERRAMIENTAS MANUALES GLB 1.00 1,118.04 0.00 1,118.04 1,118.04
SEMILLA DE ALFALFA VAR. MOAPA (INOCULADO) KG 336.00 28.00 0.00 9,408.00 9,408.00
SEMILLA DE TREBOL BLANCO (INOCULADO) KG 168.00 24.00 0.00 4,032.00 4,032.00
SEMILLA DE RYE GRASS ITALIANO KG 140.00 12.00 0.00 1,680.00 1,680.00
SEMILLA AVENA SATIVA (NEGRA) KG 196.00 3.00 0.00 588.00 588.00
MATERIALES DE ESCRITORIO GLB 1.00 1000 0.00 1,000.00 1,000.00
TOTAL ACTIVO FIJO 30,003.23 114,167.89 144,171.12
2. COSTOS PRE - OPERATIVOS
MONTO FINANCIADO POR MONTO FINANCIADO INVERSION

DESCRIPCION UNIDAD CANTIDAD PRECIO REFERENCIAL
LOS AEOs (S/.) POR EL GL (S/.) TOTAL (S/.)
FORMULACION DE PROPUESTAS PRODUCTIVAS UNIDAD 1.00 5000 0.00 5,000.00 5,000.00
ASISTENCIA TECNICA GLOBAL 1.00 3,333.33 0.00 3,333.33 3,333.33
MANO DE OBRA CALIFICADA GLOBAL 1.00 29,600.20 0.00 29,600.20 29,600.20
MANO DE OBRA NO CALIFICADA GLOBAL 1.00 16,094.46 16,094.46 0.00 16,094.46
TOTAL 16,094.46 37,933.53 54,027.99
TOTAL INVERSION 46,097.69 152,101.42 198,199.11
Source: self made.
9.4.2 PDN financing structure
The financing structure of the PDN responds to the opportunity to participate in category A, in
the PROCOMPITE Contest for the fattening beef production sector by the District Municipality
of Quiquijana according to the following detail:
 PDN total investment cost : S/. 198.199,11 (100%)

 AEO Financing : S/. 46,097.69 (23.26%)
 PROCOMPITE – MDQ co-financing: S/. 152,101.42 (76.74%)
Profit per producer of S/. 7,078.54 (Seven thousand seventy-eight with 54/100 nuevos soles)
Participation Category : TO
Number of beneficiary families : 28

The detailed costs and financing structure are presented below:
Table No. 24. Structure of the necessary financing of the PDN

AMOUNT AMOUNT TOTAL
PRICETA
ITEM GUY UNIT QTY FINANCED BY FINANCED BY INVESTMEN
G
THE AEOs (S/.) THE GL (S/.) T (S/.)
BLACK WIRE #16 KG 372.12 4.50 0.00 1,674.54 1,674.54
WOOD NAILS WITH 2" HEAD KG 84.00 4.80 0.00 403.20 403.20
CALAMINE NAILS KG 127.68 7.00 0.00 893.76 893.76
CORRUGATED STEEL fy=4200 0.00
kg/cm2 GRADE 60 KG 3955.28 3.29 13,012.87 13,012.87
FINE SAND M3 14.84 149.00 0.00 2,211.16 2,211.16
PREPARED MUD M3 43.40 4.00 173.60 0.00 173.60
MUD PREPARED WITH STRAW M3 24.64 4.20 103.49 0.00 103.49
8" BIG STONE M3 391.44 25.00 9,786.00 0.00 9,786.00
MEDIUM 4" STONE M3 88.48 25.00 2,212.00 0.00 2,212.00
6" BIG STONE M3 10.64 25.00 266.00 0.00 266.00
3" CHROME SUMP UND 28.00 5.00 0.00 140.00 140.00
ADOBE 0.40 X 0.30 X 0.15 m UND 27695.36 0.40 11,078.14 0.00 11,078.14
PORTLAND CEMENT TYPE IP 0.00
(42.5 kg) BLS 851.48 25.00 21,287.00 21,287.00
56 Kg PLASTER BLS 50.40 8.50 0.00 428.40 428.40
Supplies and Materials
DEMOLDING LACQUER gal 6.16 115.00 0.00 708.40 708.40

RIVER CONCRETE M3 175.56 80.00 0.00 14,044.80 14,044.80
CURRENT WOOD P2 3151.40 2.40 0.00 7,563.36 7,563.36
ROLISH EUCALYPTUS WOOD Ø
5" x 8.00 m. PZA 28.00 38.00 1,064.00 0.00 1,064.00
WOODEN RULER P2 42.84 2.60 111.38 111.38
ROUGH WOOD PAIR MODEL Ø
5"x5.08m @ 0.90m UND 280.00 15.00 4,200.00 4,200.00
WOOD STRAPS (3"x2"x26 1/4') UND 196.00 40.00 0.00 7,840.00 7,840.00
TIE BEAMS (5"x4"x 26 1/4') UND 56.00 20.00 1,120.00 0.00 1,120.00
6 mm TRIPLAY FOR
FORMWORK P.L. 13.16 49.00 0.00 644.84 644.84
GALVANIZED CALAMINE 11
CHANNELS 1.80x0.80x0.21mm P.L. 1064.00 20.00 0.00 21,280.00 21,280.00
SAW BLADE UND 37.52 5.00 0.00 187.60 187.60
3" X 90° SAL PVC ELBOW UND 28.00 2.50 0.00 70.00 70.00
PVC SALT PIPE 3" M 28.00 16.00 0.00 448.00 448.00
PVC SALT P TRAP 3" PZA 28.00 17.50 0.00 490.00 490.00
STRING RLL 88.76 15.00 0.00 1,331.40 1,331.40
MANUAL TOOLS GLB 1.00 1,118.04 0.00 1,118.04 1,118.04
ALFALFA SEED VAR. MOAPA 0.00
(INOCULATED) KG 336.00 28.00 9,408.00 9,408.00
WHITE CLOVER SEED 0.00
(INOCULATED) KG 168.00 24.00 4,032.00 4,032.00
ITALIAN RYE GRASS SEED KG 140.00 12.00 0.00 1,680.00 1,680.00

AVENA SATIVA SEED (BLACK) KG 196.00 3.00 0.00 588.00 588.00

DESK MATERIALS GLB 1.00 1000 0.00 1,000.00 1,000.00
FORMULATION OF 0.00
Services PRODUCTIVE PROPOSALS UNIT 1.00 5000 5,000.00 5,000.00
TECHNICAL ASSISTANCE GLOBAL 1.00 3,333.33 0.00 3,333.33 3,333.33
SKILLED LABOR GLOBAL 1.00 29,600.20 0.00 29,600.20 29,600.20
UNSKILLED LABOR GLOBAL 1.00 16,094.46 16,094.46 0.00 16,094.46
TOTALS 46,097.69 152,101.42 198,199.11
CO-FINANCING %: (CO-FINANCED AMOUNT / TOTAL INVESTMENT) X100 23.26 76.74 100.00
CO-FINANCING AMOUNT PER HOUSEHOLD: CO-FINANCED AMOUNT /
TOTAL BENEFICIARY HOUSEHOLDS 1,646.35 5,432.19 7,078.54
Source: self made.
9.4.3 Analysis of Fixed and Variable costs.
Fixed costs are considered to be those directly involved in the production process for the
production of beef cattle, which we detail below:
- Commercialization.
- Health.
- Feeding.
- Unskilled labor.
The production costs incurred when fattening cattle for meat, and the operation and
maintenance costs for which the following assumptions are considered:
- Beef Marketing Costs S/. 10.00 per head

- Cattle Health Costs S/. 15.00 per head
- Campaign duration 120 days.
- Number of cattle per campaign 4 adult cattle.
- Beef feed requirement = 3.0 Kg/day
- Labor in production S/. 350.00 monthly. = S/. 1400/period.
- Cost of 01 kg of alfalfa equal to S/.0.008
- Cost of 01 kg of bran at S/. 1.00
- Cost of 01 kg of corn flour at S/. 1.80
- Cost of 01 kg of fish meal at S/. 2.30
- Cost of 01 kg of mineral salts at S/. 10.00
- Cost of 01 kg of common salt at S/. 1.00
Considering the above, the operation and maintenance costs are projected, which can be seen
in the following table:

Table N°25 . Operation and maintenance costs with PDN

COSTO
UNIDAD DE COSTO
COSTOS DE OPERACIÓN CANT. UNITARIO Año 1 Año 2 Año 3 Año 4
MEDIDA TOTAL
(S/.)
1. Costos Indirectos 5,040.00 5,040.00 5,040.00 5,040.00 5,040.00
Costos de Sanidad Animal Global 1.00 5040.00 5,040.00 5,040.00 5,040.00 5,040.00 5,040.00
2. Costos Directos 1,009,048.32 1,009,048.32 1,009,048.32 1,009,048.32 1,009,048.32
Materia prima e insumos 883,048.32 883,048.32 883,048.32 883,048.32 883,048.32
Vacunos Cab 336.00 2,100.00 705,600.00 705,600.00 705,600.00 705,600.00 705,600.00
Afrecho Kg 76,809.60 1.00 76,809.60 76,809.60 76,809.60 76,809.60 76,809.60
Harina de maíz Kg 36,288.00 1.80 65,318.40 65,318.40 65,318.40 65,318.40 65,318.40
Harina de pescado Kg 4,838.40 2.30 11,128.32 11,128.32 11,128.32 11,128.32 11,128.32
Sales minerales Kg 604.80 10.00 6,048.00 6,048.00 6,048.00 6,048.00 6,048.00
Sal común Kg 1,209.60 1.00 1,209.60 1,209.60 1,209.60 1,209.60 1,209.60
Forraje Verde Fresco Kg 403,200.00 0.04 16,934.40 16,934.40 16,934.40 16,934.40 16,934.40
Mano de obra directa. 126,000.00 126,000.00 126,000.00 126,000.00 126,000.00
Mano de obra en la produccion Mensual 168.00 750.00 126,000.00 126,000.00 126,000.00 126,000.00 126,000.00
3. Gastos de administración 9,600.00 9,600.00 9,600.00 9,600.00 9,600.00
Administrador Servicios 12.00 800.00 9,600.00 9,600.00 9,600.00 9,600.00 9,600.00
4. Gastos de Ventas 3,360.00 3,360.00 3,360.00 3,360.00 3,360.00
Costos de Comercializacion Global 1.00 3360.00 3,360.00 3,360.00 3,360.00 3,360.00 3,360.00
Total Costos de Operación 1,023,688.32 1,023,688.32 1,023,688.32 1,023,688.32 1,023,688.32
Source: self made.
9.5 DETERMINATION OF THE SALES PRICE.
According to the market study carried out with a field study, it was possible to obtain that the kilo
is S/.9.00 nuevos soles, this is the price at which the intermediaries in this area buy and that the
meat is destined for the market of the province of Cusco, in that sense we, as products, will
produce for the Arequipa market through contact with intermediaries of this market in the cattle
ranch of the Combapata district, where prices per kilo are valued wholesale according to the
Cusco market.
Table No. 26
INGRESOS BRUTOS
PES O EN CANTIDAD
ES PECIFICACION CANTIDAD PRECIO INGRES OS
KILOS EN KILOS
P OR GANADO 1.00 364.00 364.00 9.00 3,276.00
P OR P RODUCTOR 12.00 364.00 4,368.00 9.00 39,312.00
P OR AEO 336.00 364.00 122,304.00 9.00 1,100,736.00
FUENTE: Elaboracion P ropia
9.6 DETERMINATION OF INCOME.
The producers individually will produce 12 cattle where each cattle is valued at 3,337.88 soles at
market prices per year, with a weight of 364 kilos per head and a price of 9.17 soles, this in the
Lima market in which we will be immersed; On the other hand, the AEO (association of fattened
bull producers of the Qquehuarmayo Microbasin) will produce 336 heads of cattle per year for
the market.
Table N°27. Projected Income Flow for 04 years

PERIODO (Años)
RUBROS
0 1 2 3 4
A) INGRESOS 0 1,100,736.00 1,100,736.00 1,100,736.00 1,100,736.00
Cantidad de produccion (Productos) 0.00 336.00 336.00 336.00 336.00
Precio Unitario 0.00 3,276.00 3,276.00 3,276.00 3,276.00
Source: self made

9.7 BREAKEVEN ANALYSIS
The breakeven point is the amount of products or services that need to be sold to sustain the
business, that is, cover costs. In other words, the break-even point provides you with the
minimum amount that has to be produced and sold in order not to gain or lose.
Table No. 28. Determination of balance point.

AÑOS Año 01 Año 02 Año03 Año 04
Costo variable S/. 888,088.32 S/. 888,088.32 S/. 888,088.32 S/. 888,088.32
Costo fijo S/. 135,600.00 S/. 135,600.00 S/. 135,600.00 S/. 135,600.00
Precio S/. S/. 3,276.00 S/. 3,276.00 S/. 3,276.00 S/. 3,276.00
Cantidad Cab. 336 336 336 336
Costo variable unitario S/. 2,643.12 S/. 2,643.12 S/. 2,643.12 S/. 2,643.12
Precio - costo valor unitario S/. 632.88 S/. 632.88 S/. 632.88 S/. 632.88
PUNTO DE EQUILIBRIO 313 313 313 313
Ingreso Bruto S/. S/. 1,100,736.00 S/. 1,100,736.00 S/. 1,100,736.00 S/. 1,100,736.00
Costo Total S/. S/. 1,023,688.32 S/. 1,023,688.32 S/. 1,023,688.32 S/. 1,023,688.32
Utilidad S/. S/. 77,047.68 S/. 77,047.68 S/. 77,047.68 S/. 77,047.68
Source: self made
9.8 PROFITABILITY EVALUATION
For the evaluation of profitability, the following criteria are used:
- The net present value (NPV): It is a procedure that allows calculating the present value of a
certain number of future cash flows that the project will generate, discounted at a discount
rate and deducting the initial amount of the investment.
The discount rate can be obtained from the return that will be achieved in a second best
investment alternative available, and for this purpose alternatives that are strictly comparable
in terms of the degree of risk must be considered. The business is profitable when NPV is
greater than zero. The following table details the evaluation criteria:
NPV < 0 The project is rejected

NPV = 0 It is rejected
NPV > 0 The project is accepted
- Internal rate of return (IRR) : It is the minimum interest rate by which the investment is
recovered. The IRR is the discount rate that makes the NPV equal to zero. To make the
decision it is necessary to relate the IRR with the discount rate. Thus we have:
IRR <i The project is rejected

IRR =i It's indifferent
IRR >i The project is accepted

Table No. 29. Projected cash flow for 04 years

PERIODO (Años)
RUBROS
0 1 2 3 4
INGRESOS TOTALES 0.00 1,100,736.00 1,100,736.00 1,100,736.00 1,100,736.00
EGRESOS TOTALES 198,199.11 1,023,688.32 1,023,688.32 1,023,688.32 1,023,688.32
FLUJO DE CAJA ANTES DE IMPUESTOS -198,199.11 77,047.68 77,047.68 77,047.68 77,047.68
VALOR ACTUAL NETO (VAN) S/. 46,031.67

TASA INTERNA DE RETORNO (TIR) 20.33%
COSTO DE OPORTUNIDAD DEL CAPITAL (COK) 10%
VENTAS EN LOS PROXIMOS 4 AÑOS (S/.) S/. 4,402,944.00
UTILIDADES EN LOS PROXIMOS 4 AÑOS (S/.) S/. 109,991.61
Source: self made
In the analysis of private profitability, the PDN is positive with an NPV S/. 46,031.67 and an IRR of
20.33%, with a discount rate of 10%, which indicates that for every S/.100.00 (one hundred and
00/100 nuevos soles) of investment in year 04 of implementing the PDN, not only the investment
made but S/.20.33 (twenty and 33/100 nuevos soles), reflected in the economic improvement of
the AEO beef cattle fattening producer.
10. INDICATORS OF IMPACTS OF THE PRODUCTION PROPOSAL
According to the studies carried out by the technical team, the following results were evident
among the members of the Association of Fattened Bull Producers of the Qquehuarmayo
Microbasin of the Quiquijana district.
 Production levels.
By dedicating themselves to this activity as producers in this valley area, it is possible to
demonstrate that they carry out the activity with the fattening process of Brown Swiss cattle
and Creoles crossed with Brown Swiss where the production time is 6 to 12 months of
fattening. , but there are producers who are dedicated to this activity incipiently and
extensively where they obtain daily weight gains that are scarce (ranging from 100 to 250
gr/day/cow) due to the movement of cattle in the natural pasture, they lose energy and at the
same time said Animals are used as labor force in agricultural activities (Sowing and Hilling).
 60% of the cattle population are dual-purpose animals, these animals not being net
meat or milk production animals.
 There are no environments conditioned for a good breeding system.
The fattening system proposed is to increase the feed conversion capacity and in less time,
which makes the resources available in the area efficient, improving the quality of meat, with a
fattening period of maximum 120 days, complemented with energy, protein foods, mineral

salts and vitamin boosts that are within the reach of producers, where a weight gain of 900 gr
to 950 gr/day is obtained.
 Costs.
The production costs using the traditional model (Brown Swiss) and Criollo improved by
Cabeza/Cattle in this area to be intervened are valued above 2,780.00 nuevos soles, this is due
to the fact that the production stage tends to extend beyond 6 months and this causes
production costs to increase.
On the other hand, according to the technical report on the implementation of the initiative to
support competitiveness Law No. 29337 PROCOMPITE – District Municipality of Quiquijana, a
production cost structure paradigm was used, where the assumption is that each producer
produced two cattle. for meat, where the production costs were 5,562.96 nuevos soles in order
to be able to make comparisons of production with the intervention of the PROCOMPITE
Business Plan and without a business plan.
 Productivity level.
Currently, productivity levels range from 100 to 250 gr/day/cow; In this context, the
productivity levels of cattle before marketing them are determined through the calculations of
a cattle tape, where the weight reached on average is 336 kilograms, where on average for sale
each head of cattle is valued at S/. 3,024.00.
The fattening system proposed with the PdN is mixed, which makes efficient use of the
resources available in the area, improving the quality of meat, with a fattening period of
maximum 120 days, complemented with energy foods, proteins, salts. minerals and vitamin
supplements that are within the reach of producers, where there is an expectation of obtaining
a weight gain of 0.9 Kg to 0.95 Kg/day; at the same time a product (livestock) with an average
weight of 364 kilograms (biometrically) at least in each campaign.
 Sales levels.
Currently, the marketing of beef cattle is carried out individually, where each producer sells his
product to intermediaries or rescuers due to the existence of market failures in terms of
asymmetric information on real prices.
Each producer currently produces on average 9 cattle per year for the market with an average
weight of approximately 336.00 kilograms.
 Number of jobs in the town .

The Economically Active population of the District of Quiquijana represents 36.02% of the total
population of the district according to the 2007 Population and Housing Census, of which
61.80% are men and the rest women. In this district, the trend continues to incorporate a high
percentage of children and young people into productive activities, mainly in rural areas, which
is why the percentage of EAP is higher than the National average, which is 33.1.
According to the Quiquijana Concerted Development Plan 2012-2021, they pointed out to us
that the economic sector that concentrates the most people is agricultural activity (88.40% of
the total EAP), there is the almost non-existence of primary industrial activities and the scarcity
of services. that are provided to the inhabitants of this district.
The economic structure of the district was fundamentally based on livestock activity, in which
the production of cattle, sheep, alpaca, pigs and guinea pigs was dominant. For this purpose,
the institutions that worked are: the Puno Cusco Corridor Development Project, World Vision,
Ministry of Agriculture, CCAIJO and Guamán Poma de Ayala.
 Income levels of producers.

According to the analysis carried out (technical report on the implementation of the
competitiveness support initiative Law No. 29337 – PROCOMPITE), there is currently a monthly
economic income of S/. 145.68 in this sense the profits are minimal so with this income the
fattening cattle breeders will only survive but will not have an adequate quality of life, this
being a secondary activity but it could be a primary activity for the resident of the Quiquijana
district.
The income levels that are intended to be achieved (under the assumption that only 2 cattle for
meat are produced per producer) with the productive initiative of PROCOMPITE – Quiquijana, a
monthly income per producer can be obtained Monthly economic income S/. 283.59. This, at
the same time, is good in order to improve the quality of life of the producer and generate
expectations for the producer and a positive externality to other producers not immersed in
this business plan.
 Degree of customer satisfaction.

Currently, effective demand is frustrated by the low quality of cattle and in inadequate
conditions for sales to retailers or final consumers, because the producer produces according to
his artisanal criteria.
With the intervention of this PROCOMPITE Business Plan, it is possible to produce a quality
product according to the production standards and market demands (which is what the market
wants and not what the producer wants to produce).
 Women's participation.
Currently, the participation of women is in a large percentage, this is because in this area the
woman has the activity of housewife and to complement her daily activities, she assists the
cattle by grazing and providing food.
With the implementation of the business plan, it is intended to insert women into this activity
to improve their family per capita income.

11. CONCLUSIONS
• The problem of “Low production of fattening cattle, of the Association of Livestock Feeders of
the Vilcanota Valley” is due to: Limited spaces and productive infrastructure for the
development of the activity and the low availability of green forage, lack of knowledge of the
productive management, weak management of feed ration for beef cattle and weak business
organization.
• The business plan is economically profitable, presenting an IRR of 20.33%, and a NPV S/.
46,031.67, with a discount rate of 10%, which indicates that for every S/.100.00 (one hundred
and 00/100 nuevos soles) of investment in year 04 of implementing the PDN, the investment
made is recovered and S/.20.33 ( twenty and 33/100 new soles) reflecting the economic
improvement of the livestock producer.
• The implementation of this Productive proposal for 28 partners will increase the production
of beef cattle with an average of 12 cattle per producer per year and jointly with the AEO a
total of 336 animals per year, remaining constant until year 4.
• The main activities will be: implementation with productive infrastructure such as 8x4.5 m
sheds, Technical Assistance in the production process and marketing, Installation of pastures
on 1/3 of hectares per home.
12. ANNEXES
Photographs.

CURRENT CONDITIONS TO BE INTERNED


TECHNICAL
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BUSINESS PLAN:

Improvement of the Production of Fattening Beef Cattle of the Association of Cattle

Association of Beef Fatteners of the Vilcanota Valley. Page 1

Association of Beef Fatteners of the Vilcanota Valley. Page 2

“IMPROVEMENT OF CATTLE PRODUCTION IN GORDE,

Familias de la Región Productores organizados a

Source: self made.

Association of Beef Fatteners of the Vilcanota Valley. Page 3

a) Location of the proposal in the production chain.

b) References of productive proposals

1.2. NAME OF THE PRODUCTIVE PROPOSAL.

2.1 DEMAND ANALYSIS

Association of Beef Fatteners of the Vilcanota Valley. Page 5

 Price of the product.

 Expectations about the future.

Association of Beef Fatteners of the Vilcanota Valley. Page 6

2.1.1 Market segmentation.

Association of Beef Fatteners of the Vilcanota Valley. Page 7

2.1.1. Projected demand

Association of Beef Fatteners of the Vilcanota Valley. Page 8

Source: own elaboration based on data from: MINAG – OEEE.

 The product or service of the productive proposal.

 Define the unit of measurement.

 Define the bidders.

 Offer estimation model.

Table No. 06. Projected AEO Product Offer with PDN

Association of Beef Fatteners of the Vilcanota Valley. Page 9

CANTIDAD DDE PRODUCCION

Table No. 07. Projected demand for beef Arequipa Region

3.1 MACRO ENVIRONMENTAL ANALYSIS.

Association of Beef Fatteners of the Vilcanota Valley. Page 10

 Economic and Market Factors.

Table No. 08. Livestock product indices

 Political Legal Factors.

Association of Beef Fatteners of the Vilcanota Valley. Page 11

3.2 MICRO ENVIRONMENT ANALYSIS.

Association of Beef Fatteners of the Vilcanota Valley. Page 12

 Competitive Market Structure.

- The Bargaining Power of Buyers:

 The bargaining power of final buyers who have decision-making power

 Transformers and distributors have high bargaining power in the purchasing

- Bargaining power of suppliers.

 To determine the bargaining power of beef suppliers, the actors in the

 Wholesale intermediaries have high negotiating power when selling due to

- Threat from potential competitors.

Association of Beef Fatteners of the Vilcanota Valley. Page 13

- Threats of substitute products.

 These competitive products called in this case mass consumption meat

Therefore, expectations remain stationary, the differentiation would be in the quality of

4.1 LOCATION OF THE AEO.

Association of Beef Fatteners of the Vilcanota Valley. Page 14

NATIONAL MAP CUSCO REGION

PROVINCE OF QUISPICANCHI QUIQUIJANA DISTRICT

Association of Beef Fatteners of the Vilcanota Valley. Page 15

4.2 COMPOSITION OF THE AEO BOARD OF DIRECTORS.

 Data of the person with whom the communication must be made.

4.3 AEO PARTICIPANTS.

Association of Beef Fatteners of the Vilcanota Valley. Page 16

Association of Beef Fatteners of the Vilcanota Valley. Page 17

4.4 PROFIT DISTRIBUTION STRUCTURE

4.5 MEASURES TO AVOID MISMANAGEMENT OF AEO.

To promote transparency in the administration of AEOs, certain measures are proposed to