Executive Summary

BACKGROUND
The production of tropical fish has become an extremely important economic activity in other countries such as
Brazil, Colombia, Mexico and Venezuela; In Bolivia there have been successful trials and experiences in
Cochabamba and Santa Cruz, where fish farms have been implemented in various systems (intensive, semi-
intensive and extensive), differing from each other by the projected production levels and their intensity in
stocking densities and artificial feeding with balanced rations.
Tropical fish meat has shown a significant increase in demand in the departments of Cochabamba, Santa Cruz
and La Paz, mainly the species Surubi, Pacu, Tambaqui, Dorado, Sábalo, Tilapia and others to a lesser extent,
in hotels and restaurants. , supermarkets, regional markets and popular markets, likewise the trend towards the
consumption of white meat for health reasons, the affordable price, habits and promotion through regional fish
fairs have caused a growing internal demand, which has an impact on the development of new products with
greater added value.
On the other hand, the alarming reduction in the supply of fish caused by the selective fishing traditionally
practiced and the overexploitation of these resources have left a significant void in the market that guarantees
the future and growth of the TAMBAQUI Association.
Recently the “Support Program for the Alternative Development Strategy in Chapare” PRAEDAC has
implemented in the surroundings of Ivirgarzama , 200 km away. from the city of Cochabamba and 180 km.
from the city of Santa Cruz on the main road that connects these two departments, 25 modules of family fish
production in 50 ponds of 1000 square meters each, projecting to benefit another 25 families with another 50
ponds, which organized as Association of producers will total 10,000 m2 of water surface with a production
capacity of 60,000 kilograms per year of tropical fish (Pacu, TAMBAQUI and Tilapia), also to efficiently serve
the market "The TAMBAQUI Fish Producers Association" will implement a collection, transformation company
and marketing, with the capacity to process 100,000 kg. annually, preventing subsequent growth up to that
volume.
GOALS
The short-term objectives are focused on the production chain of fish meat and derivatives being articulated
vertically from primary production to distribution and marketing, generating added value and increasing both the
profitability of the company and income for families. associated, while ensuring the food security of fish farming
families and their environment.
The long-term objectives are based on optimal business management, to position TAMBAQUI as a leader in
the differentiated production of tropical fish meat in the Bolivian market, whose economic return provides
prosperity to partners, families and the community.
STRATEGIES
In this business plan, it is proposed that the “TAMBAQUI” Association adopt a strategic position of broad
differentiation for the national domestic market and offer differentiation attributes, transferring added value to
the product such as reliability, freshness, safety, hygiene, etc. . attributes that are valued by target market
segments. On the other hand, it is recommended to adopt the growth strategy from two perspectives. The first,
related to the internal market, opting for a market penetration strategy, seeking

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the ways to increase participation in current markets, investing in global demand, increasing sales, acquiring a
position in the market, defending that market position, reorganizing undersupplied markets and improving
profitability. In a second perspective of the business, the international market must be considered; since new
markets are being treated with current products, a market development strategy must be chosen.
The product design has considered two linked production processes (fish production and primary processing or
industrialization), for the fish production process, the product is whole fish with viscera ; and several
products and presentations of the primary industrialization process for commercialization, these are:
^ Whole fish without viscera in bulk
^ Whole fish without viscera on trays
^ Whole fish without viscera vacuum-packed
^ Headless fish without guts HG in bulk
^ Headless fish without guts HG on platter
^ Headless fish without viscera HG vacuum
^ Bulk butterfly cut fish
^ Butterfly cut fish on a platter
^ Vacuum cut butterfly fish
^ Bulk fish fillet
^ Fish fillet on a platter
^ Vacuum-fed fish fillet
In addition to these presentations, the feasibility of entering more sophisticated processes such as smoking will
subsequently be evaluated, depending on demand and production volume.
The implementation of a small cold chain to ensure the freshness of the fish until it reaches the final consumer
will be the predominant factor to achieve the differentiation and positioning of the product as fresh
refrigerated fish from the Cochabamba Tropics. Likewise, the different types of presentation are designed
based on the proposed market penetration strategy, for example, products with bulk presentation have the vice
of similar characteristics with the products on the market. However, it should not be forgotten that fish meat will
be sold “chilled” and “fresh”, thus providing differentiation of the product from that of the competition. In the
same way, the product will be differentiated through the different types of cuts, with tray and vacuum
presentations.
Finally, the fact that the producers of the “TAMBAQUI Tropical Fish Producers Association” are the owners of
the collection, transformation and marketing company ensures the continuous supply of raw materials (whole
farmed fish), an advantage that must be carefully considered. if any investor decides to divert their investments
to another company in the same field.
CONCLUSIONS
It is timely and very useful to add additional conclusions on specific topics and areas that have been part of this
study and that have led to the achievement of the objectives.
A complete analysis of the fish meat industrial sector has been carried out. This has included the analysis of the
situation of the environment, analysis of textures, analysis of Porter's competitive forces, analysis of profitability
and attractiveness of the industrial sector, analysis of segmentation levels, impact of entry and exit barriers on
the profitability of industry and business risk analysis.
Based on all the previous information, the following has been established as a conclusion of the analysis of the
industrial sector: “The sector is established by few companies that have a share of

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significant market and none can influence the evolution of the industry. There are low entry barriers, absence of
economies of scale, high transportation and storage costs and diversity in customer needs, which is why it is
concluded that it is a fragmented industrial sector.”
The scope of the strategy in which TAMBAQUI must operate has been defined for its institutional consolidation
at all levels. To this end, the Strengths, Opportunities, Weaknesses and Threats have been identified and the
critical success factors have been identified.

The sales projections result in the following tables:

Description $us / Kg. Bs. / Kg.

Purchase price Kg of fish from the producer $us 1,65 13,00

Sale price kg. fish without guts 2,40 18,96

Sale price kg. fish without guts HG 3,02 23,89

Sale price kg. butterfly cut fish 3,14 24,84

Sale price kg. fish fillet 3,38 26,73

Mix and percentage of usable whole Year 1 Year 2 Year 3 Year 4 Year 5
weight ($us) $us) ($us) $us) ($us)
Kg. Fish without guts 20% $3182 12730 12730 12730 12730

Kg. Fish without guts and head HG 35% 6245 24981 24981 24981 24981

Kg. Butterfly cut fish 30% 5566 22262 22262 22262 22262

Kg. Fish fillet 15% 2827 11308 11308 11308 11308

Total income 17820 71281 71281 71281 71281

The investments planned for 2005 amount to 35,500 dollars, considering the production volumes that
TAMBAQUI will achieve starting that year, considering 50 modules and 100 ponds.

The income statement of TAMBAQUI presents a value of $us in the first year. 7,395, which tend to increase
constantly from the second to the fifth year, reaching a value of $us. 17.555.
The analysis carried out according to the sales and the investments that are intended to be made result in a net
cash flow with positive values in the five years. The cost-benefit ratio is low, 11 cents recovered per dollar
invested, but taking into account that the basic function of the processing plant is to capture the entire
production, it will contribute to the socioeconomic development of the region.

RECOMMENDATIONS
It is recommended to opt for initiatives to make products known to consumers through events such as fairs,
tasting sessions, as well as information on the different ways of preparation.
It is advisable to implement a policy for the management and use of process waste (viscera, bones, etc.),
consistent with an environmental management plan, which allows them to be used as additives for balanced
feed.

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It should be ensured that production and sales volumes increase rapidly by cultivating the recommended
planting densities and increasing the number of ponds, in order to access an economy of scale scenario.
The implementation of more ponds is recommended, either with the support of a cooperation agency or on its
own, since an increase in production volumes is expected as a result of the increase in the number of partners
or the growth of existing ones, based in the results of the financial year that were positive per family module,
from the three thousand meters of cultivated water surface (3 ponds)
It is recommended that the quality and presentation of the products that TAMBAQUI launches on the market
remain homogeneous and meet the requirements specified by customers at all times.
For the opening of markets, two aspects must be highlighted: the origin of the products (fresh, refrigerated
farmed fish from the Cochabamba tropics) and the socio-economic benefit it generates (strategy to support
Alternative Development).
Support for fish-producing beneficiaries should be aimed at planning sowing and harvesting, as well as
resource management and provision of funds for future purchases of fingerlings and inputs for subsequent
production cycles, this will allow them to achieve sustainable production and a adequate self-management
capacity.
The financial analysis has given guidelines to recommend the following:
The financial structure proposed for TAMBAQUI shows a lack of liquidity or availability of resources to cover
short-term obligations, for this reason the treasury accounts present negative results. On the other hand, the
shortage of own funds can increase in the future either through capital injection or retention of profits,
converting them into reserves.

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1. GENERAL INFORMATION ABOUT THE PLAN

The characteristics of the business plan that we propose, both in content and detail, are
fundamentally subject to the initial diagnosis and the needs of the beneficiary company.

1.1. Background

The fish producers of the tropical zone of the Carrasco province founded the
“Organization of Fish Farmers of Carrasco Tropical” whose distinctive acronym is
“TAMBAQUI”, on November 6, 2003, in the town of Ivirgarzama, fifth municipal section
of the province. Carrasco province of the department of Cochabamba. This is a private,
non-profit civil union organization, whose operation is oriented to the benefit of the
associated families that comprise it; Its area of influence is the municipal sections of the
Carrasco Province in its tropical zone, that is, the fourth, fifth and sixth municipal
sections, Chimoré, Puerto Villarroel and Entre Ríos.

The aims and objectives of TAMBAQUI are:

a) Promotion of the development of the production of fish meat and derivatives,

through the construction and management of breeding ponds.

b) Creation and operation of a peasant company for the processing and marketing
of products based on fish meat and its derivatives. Under this modality,
TAMBAQUI members plan to receive income from two sources: the sale of fish
meat and the distribution of profits at the end of each management.

c) Manage and channel institutional support and financing for the development of
fish production in the tropical zone of the Carrasco province.

d) Promote and carry out permanent training and training actions for associates and their
families to improve fish production.

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e) Coordinate with public and private entities in the fish farming sector, for the
development of fish farming in the Cochabamba Tropics.

Currently, the construction of the productive infrastructure (offices, production pools,

storage chambers and wholesale sales center) is planned.

Thanks to the support of PRAEDAC and the mayor's office of Puerto Villarroel, each of
the 25 TAMBAQUI partners have benefited from the construction of 2 1000m2 breeding
ponds, the supply of balanced feed and fingerlings, for a production cycle.

However, it is clearly established that this donation will end at the end of the cycle.

In the life of TAMBAQUI, management, administration and operating manuals have not
yet been developed, nor has a functional administrative structure been put together,
necessary for the operation of the company, nor have commercial channels been
defined with national and international companies. .

The development of this Business Plan is, therefore, one of the fundamental tools that
PRAEDAC provides to TAMBAQUI so that it can insert itself into a scenario of
comprehensive and sustained improvement, consolidate itself in the sector of production
and use of fish farming.

1.2. General objective

Establish a Business Plan that allows TAMBAQUI to lead towards a plan of strategic
and operational improvement, effective implementation and institutional consolidation.

1.3. Specific objectives

Carry out an initial diagnosis of the operation of the TAMBAQUI company, identifying
those areas that present failures or require improvement.

Establish a comprehensive Business Plan that includes the corrective measures

required to solve problems found, and guides company executives in strategic and
operational management tasks.

Design action and improvement plans for each area of the company, with the level of

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detail that each one requires, as a fundamental part of the comprehensive Business
Plan.

1.4. Goals

According to the information obtained from the beneficiary company, and its analysis,
we will later propose objective and real goals, in the short, medium and long term, that
allow us to evaluate compliance with the Business Plan from the planning phase.
implementation.

To do this we will have figures, indices and indicators for each of the areas; for example:
Production capacity, Percentage of non-conforming products, Net Profit, Sales volumes,
Internal Rate of Return, etc.

1.5. Products

A detailed analysis of the products and/or services offered by TAMBAQUI is essential to

design a complete and coherent business plan.

In this way, improvements or modifications can be established that make the products
more attractive and help carry out an effective marketing and sales plan.

The characteristics inherent to each product also allow us to analyze its qualitative
position within the framework of the industrial sector to which it belongs.

Food products such as TAMBAQUII and Tilapia fish species present numerous
advantages and disadvantages in terms of production, performance, quality and market
opportunities. For this reason, it is essential to carry out a complete and thorough
analysis of the products and/or services offered by TAMBAQUI. The proposed
guidelines in this sense will be seen later, specifically in the subtitles of product design,
process design and quality control .

1.6. Activities

Annex I, proposed Work Plan, shows the general activities that have been contemplated
for the preparation of this project. Basically they are the following :

a) Compilation of information on the topic; that is, bibliography and data on the

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 industrial, business and other sectors related to the beneficiary company.
b) Organization of work and logistics team with PRAEDAC.
c) Trip to the Tropics of Cochabamba.
d) Logistics organization in the Tropics of Cochabamba.
e) Contact and interviews with TAMBAQUI executives and technicians.
f) Return to Cochabamba
g) Field work evaluation meeting and coordination with the person responsible for the
productive development of PRAEDAC
h) Analysis of information collected in the company
i) Preparation of preliminary business plan report
j) Discussion of report with PRAEDAC directors
k) Final report presentation

1.7. Resources

To carry out this study, the following resources have been invested:

1.7.1. Humans

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 o Consultants (6)
o Responsible for the Productive Development Component of PRAEDAC
(support)

1.7.2. Materials

o Vehicle (2)
o Computers (6)
o Printer (3)
o Calculators (3)
o Stationery and stationery
o Floppy disks and compact discs

1.8. Features

For the preparation of this business plan, the following functions and their respective
managers have been proposed:

a) Plan: Consultant 1
b) Organize: Consultant 1 / Responsible for the Productive
Development Component of PRAEDAC.
c) Coordinate:
Responsible for the Productive Development
Component of PRAEDAC (support) / Consultant
d) Directs: Consultant 1
e) Control/execute: Consultants (6)

2. ANALYSIS OF THE INDUSTRIAL SECTOR

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2.1. Environment situation

As can be seen in Table 2.1, the Bolivian economy grew 2.9% in 2002, despite having
been affected by the reduced dynamism of the international economy and, in particular,
by the financial and exchange crises in neighboring countries. ; These hindered the
normal development of foreign trade and the flow of foreign direct investment; In
addition, the fall in the prices of several export products caused the terms of trade to
deteriorate.

GDP received a boost from the rebound in the transportation, communications and
construction sectors. The policy measures undertaken by the government sought to
reactivate the economic system in the short term through the creation of financing lines
for working capital, the granting of additional incentives for the rescheduling of company
debts and the reduction of bank defaults. .

Regarding inflation, the low domestic aggregate demand was the factor that most
influenced the low annual inflation (2.4%); Additionally, the freezing of hydrocarbon
prices, in force since the previous government administration and which sought to avoid
the further deterioration of the population's income, also had an impact in the same
sense.

Public finances were affected with a higher fiscal deficit that reached 8.6% of GDP due
to the expansion of public spending and weak tax collection; but the limited dynamism of
economic activity meant that this amount of deficit was not expressed in an inflationary
pressure factor.

Table 2.1 – Macroeconomic indicators Bolivia 2001-2003

Indicators 2001 2002 2003
Consumer's price index (%) 0.90 2.40 2.70
GDP, annual growth rate (%) 1.20 2.90 2.90

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0
 Fiscal deficit/GDP (%) 6.50 8.60 6.50
FOB Exports (Mil. $us) 1,285 1,319 Not available
CIF Imports (Thousand $us) 1,708 1,746 Not available
Trade balance balance (Mil. $us) -423.00 -427 Not available
Public investment (Mil. $us) 639.80 570 640
Foreign direct investment (Mil. $us) 825.70 1,044 Not available
Public external debt balance (Mil. $us) 4,412.10 4,299.70 Not available
Net international reserves (Mil. $us) 1,076 854 Not available
Exchange rate (Bs/$us) 6.83 7.50 8.00
Urban Unemployment (%) 8.50 8.69 Not available
Active interest rate (Foreign currency) (%) 13.50 11.92 Not available
Passive interest rate (foreign currency) (%) 2.79 3.29 Not available

Source: Price Waterhouse Coopers Bolivia

On the other hand, the depreciation of the national currency against the US dollar was 10%.
The low inflationary pressure also made possible the application of a policy of greater
depreciation of the Bolivian, in the face of the exchange crises that affected South American
countries, with which there is intensive commercial dealings.

Active interest rates in foreign currency tended to decline, compared to the levels of the
previous year; On the contrary, passive interest rates, also in foreign currency, experienced
increases due to the high concentration of deposits and credits in foreign currency in the
financial system.

In terms of foreign trade, the value of exports increased by 2.6% compared to the previous
year. In turn, imports were 2.2% higher, a fact that would be related to the rebound in the
level of activity in some sectors of the economy.

Sales of gold jewelry products and wood and leather manufactures in the US market had a
positive evolution, with great expectations for the growth of exports of textiles, leather
manufacturing, leather products, organic food products, oil and derivatives. .

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For all the above, it can be concluded, first, that there is an advantageous scenario for
foreign trade exchange; Second, there is an opportunity for investment due to low interest
rates, in addition to investment and access to credit that promotes the productive apparatus.
Finally, it is expected that domestically, aggregate demand will not suffer an immediate
increase, keeping inflation under control.

2.2. Texture analysis

A very useful tool to establish the characteristics of the environment of any business is
texture analysis. This analysis allows us to perceive the trend that the environment in which
we fit a certain business presents over time. The evaluation is carried out from various
points of view, taking into account, for example, cultural, technological, economic, market
factors, etc.

Graph 2.1 constitutes the first texture analysis leading to determining the different factors
that make up the environment of the fish harvesting industrial sector, in the past, present
and future. Annex III details the development of the graph.

Cultural Technological Market

Consumption habits Economical Geographic
Graph 2.1 – Texture Analysis

Legal
Source: self made

From the previous information, it can be seen that cultural factors, market and consumer
habits are the three most important factors and at the same time they have an increasing
behavior over time. Market factors take on greater importance over time due to the
positioning of the brand and the possibility of opening export markets. Consumption habits,

1
2
which are equally important, develop over time and there is a greater predisposition to
consume products that offer differentiation with the rest of the competition and this causes
market niches to be found and consumption habits to expand as they grow. the market.
Cultural factors, affected by the strength of promotion and inclusion of the product in the
market, change over time, making society more flexible, less conservative and more
innovative.

Technological factors vary very little due to the fact that they are standardized processes
whose technological evolution does not greatly affect the final product. However, it affects
the productive capacity.

The economic factors are descending over time due to the political-social instability that
Bolivia has been going through.

The geographical factors are descending due to the deconcentration that exists when
having the option of export markets, whose volume is much more attractive than national
demand.

Finally, legal factors are increasing due to the expectation of greater sales, production and
social benefits.

2.3. Analysis of competitive market forces (Porter Analysis)

The analysis of the five competitive market forces, called Porter Analysis, applied to the
case of TAMBAQUI, shows how they make up the structure of the industry and delimit
prices, costs and investment requirements that constitute basic factors to explain the
expectation of long-term profitability and, therefore, the attractiveness of the industry (See
Table 2.2).

Table 2.2 Analysis of competitive market forces

Effect Effect Effect

- + - + - +
Intensity of rivalry between competitors high # # x # Low high # # x # Low high # # x # Low
Negotiating capacity of clients
high # x # # Low high # x # # Low high # x# # Low
Negotiating capacity of suppliers
high # x # # Low high # x # # Low high # x# # Low

Threat of substitutes high # x # # Low high # x # # Low high # x# # Low

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3
Threat of new competitors high # # x # Low high # x # # Low high # x# # Low
Average intensity high x Low high x Low high x Low
Source: self made

Intensity of rivalry between competitors.- The medium-low effect is constant over the time in
which the rivalry of the competition moves in the future towards a leadership level. This
effect will be affected by the growth rate in the industrial sector, the magnitude of fixed costs
or storage costs, companies with attempts to achieve leadership, product differentiation and
finally, brand loyalty.

Negotiating capacity of clients.- This competitive force shows a high and constant average
intensity over time, depending on the number of important clients, importance in the buyer's
costs, degree of standardization of the product, and the income/profit of the clients. or
distributors.

Negotiating capacity of suppliers.- It can be seen that this force is constant over time, with a
medium-high intensity, taking into account the number of suppliers, supplier switching costs,
threats from the industrial sector of backward integration, threats from the supplier. of the
industry of forward integration, importance of the industry for the supplier, threats of
substitutes for suppliers and importance of the input for companies in the industrial sector.

Threat of substitutes.- It can be observed that over time, the medium-high effect is constant,
considering the relative price of the substitutes, the quality/price relationship, the profitability
of the industrial sector of the substitute, the

switching costs for the distributor or customer and the attitude of the customer or
distributor.

Threat of new competitors.- Despite being an industry with relatively high investment to
enter the sector, the threat of new competitors increases over time to a medium-high
intensity, considering economies of scale, customer sensitivity to prices, level of investment,
switching cost for the distributor or customer, cost advantages, government policy, growth
rate of the industrial sector, resources of companies in the sector to defend themselves,
barriers to entry and barriers to exit.

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2.4. Analysis of profitability and attractiveness of the industrial sector according to
the competitive forces of the market

The first fundamental determinant for the profit of a company is the attractiveness of the
industrial sector to which it belongs. To do this, a structural analysis must be carried out to
identify the attractiveness of the sector.

Competitive strategy must arise from an understanding of the rules of competition that
determine the attractiveness of an industrial sector; The ultimate intention of the competitive
strategy is to try to change those rules in favor of the company itself (See Table 2.3).

Table 2.3 Analysis of attractiveness of the industrial sector

• • • •
• Past Present • Future
- Effect + - Effect + - Effect +

Intensity among the competition high x Low high x Low high x Low

Negotiating capacity of clients high x Low high x Low high x Low

Negotiating capacity of suppliers high x Low high x Low high x Low

Threat of substitutes
high x Low high x Low high x Low
Threat of new competitors
high x Low high x Low high x Low
Attractive Low x high Low x high Low x high
Source: self made

The behavior of attractiveness in the fish meat industry over time is medium-low as seen in
the last row of table 2.3 (attractiveness), where the competitive forces of the market (row 2
to row 4) have an effect medium high, except for row 1 “intensity among competition”,
revealing the existence of entry barriers and exit barriers.

In a similar way to the previous analysis, we can operate with the profitability variable of the
industrial sector.

Table 2.4 summarizes the profitability analysis of the food industry related to fish meat,
taking into account Porter's 5 competitive forces.

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 Table 2.4 Profitability analysis of the industrial sector

• • • •
Past Present • • Future
- Effect + - Effect + - Effect +

Intensity among the competition

high x Low high x Low high x Low

Negotiating capacity of clients high x Low high x Low high x Low

Negotiating capacity of suppliers high x Low high x Low high x Low

Threat of substitutes high x Low high x Low high x Low

Threat of new competitors

high x Low high x Low high x Low
Average profitability high x Low high x Low high x Low
Source: self made

The high average profitability remains stable over time since the characteristics of the
industry reveal that fish meat is a mass consumption product, with options for opening
markets.

2.5. Analysis of segmentation levels

Market segmentation is the process of dividing a potential market into distinct subsets of
consumers and selecting

one or more segments as a target of attack to be reached with a different type of

marketing.

It is essential to analyze the segmentation of the market object of this study: fish meat of the
TAMBAQUI and Tilapia species. The applicability of this analysis means that segmentation
strategies are designed to discover the needs and wants of specific groups of consumers so
that specialized products can be developed and promoted to meet their needs. Historically,
many new products have been developed to fill gaps in the market revealed through
research of a certain segment.

When searching for appropriate market segments, it is of great importance to establish the
basis for defining segments that would be the most fruitful for creating a successful business
strategy. To this end, the following subheadings detail the analyzes of mega segmentation,
macro segmentation, micro segmentation and reference market of the industrial sector of
primary fish production and processing.

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2.5.1. Mega segmentation

Its objective is to establish a distinction between large areas that within them have a set
of homogeneous activities, both technologically and market-wise.

Graph 2.2 – Mega segmentation analysis

Source: self made

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2.5.2. Reference market

This level of segmentation maintains the same function and displays the axis of a homogeneous
group of users or consumers who are served with a certain technology.

(consumers)

Source: self made

Graph 2.3 – Reference Market Analysis

2.5.3. Macro segmentation

As can be seen in the following table, this level of segmentation, in addition to displaying the
axis of users or consumers served, allows for the identification of large groups of consumer
functions, which constitute specific and different reference markets.

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 Table 2.5 Macro segmentation analysis

Consumer
Features Popular Local fairs and Super - Restaurants Hotels Hospitals Quarters
markets markets markets

Nutrition x x x x x x x

Natural health x x x x x x x

Flavor x x x x x x x

Versatility x x x x x

Status x x x

Source: self made

2.5.4. Micro segmentation

The purpose of micro-segmentation analysis is to identify, in each business, subgroups of

consumers that pursue the same set of attributes or advantages.

Table 2.6 Micro segmentation analysis

Consumer
Zonal fairs and
Features Popular markets Supermarkets Restaurants Hotels Hospitals Quarters
markets
ABC1 II C2 1 C3 1 OF I ABC1 II C2 1 C3 II DE II ABC1 1 C2 1 C3 1 OF 1 ABC1 II C2 IE C3 IE DE I ABC1 || C2 ■1 C3 IE OF I ABC1 IE C2 IE C3 I OF I ABC1 IE C2 • C3 • DE ■

Nutrition x x x x x x x x x x x x x x x x x x x x

Natural health x x x x x x x x x x x x x x x x
Flavor x x x x x x x x x x x x x x

Versatility x x x x x x x x x x x x x x x
Status x x x x x
Source: self made

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 2.6. Impact of entry and exit barriers on the profitability of the company
industry.
One of the elements to take into account in the competitive scenario are the strategic advantages
derived from placing high barriers to entry into the market. This protects the segment more safely, and
obtaining barriers is more important than the simple knowledge of being in a privileged position.

Based on the different components determined for each market as entry and exit barriers, and having
classified them as low or high as appropriate, an analysis matrix with two columns by two rows can be
constructed.

It analyzes, depending on the type of barriers, the characteristics of the profits to be achieved
(profitability) and the risk levels (stability) for investments in said markets (See Chart 2.4).

Graph 2.4 – Analysis of the impact of entry and exit barriers on the
profitability and stability of the production and processing industry
fish.

(Low) (Elevated)

(Elevated)
High and stable profitability High but possibly unstable profitability

BARRIERS
OF
ENTRANCE

Cost effectiveness Cost effectiveness

low and stable low and unstable
(Low)

EXIT BARRIERS

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0
 Source: self made

The characteristics of the industry show that it is not difficult to enter this sector, since the
market allows the profitability of the entrant to not be lower than what current competitors
are obtaining, nor does it have leadership that imposes a brand image, patents or
government regulations exist. It has been seen that there are still no economies of scale,
privileged access to raw materials and distribution channels or special production
processes; Therefore, it is concluded that there are no high entry barriers.

On the other hand, exit barriers are low, since there are no specialized fixed assets and
fixed costs are relatively low.

Due to the aforementioned characteristics, TAMBAQUI is within an area with low but stable
profitability.

2.7. Business risk analysis

Table 2.7 shows an analysis of systematic risk or own risk, which depends on internal
factors of the company, and non-systematic risk, which depends on the competitive forces
of the market, resulting in the impact of competitive forces on risk factors. .

Table 2.7 – Business risk analysis

Own Risk High Medium I Low ■ Competitive Forces High Medium Low

x Threat of substitute products x

Demand variability
Threat of new income x

Bargaining power of buyers x

x
Sales price variability Rivalry between existing firms x
Ability to adjust sales prices
Bargaining power of buyers x
x

Variability of input prices x Bargaining power of suppliers x

Bargaining power of suppliers x

Operating Leverage
Rivalry between existing firms x
x
Average own risk • X •• Average Total Risk • • X
Source: self made

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 There is a medium risk, mainly affected by the variability of demand, input prices and
sales prices.

The total risk as an industry is also medium, where all variables

involved points to that result.

2.8. Conclusions on the industrial sector

The sector is established by few companies that have a significant market share and
none can influence the evolution of the industry. There are low entry barriers, absence
of economies of scale, high transportation and storage costs and diversity in customer
needs, which is why it is concluded that it is a fragmented industrial sector.

3. PROPOSED PLAN

3.1. Strategy definition

3.1.1. Determination of competitive advantages

Below are some of the competitive advantages identified for the TAMBAQUI
association.

o The agro-environmental conditions of tropical growing areas; Humidity, stable

temperatures, a regular level of precipitation throughout the year and optimal
soil conditions allow the production of a uniform product with important qualities
of flavor and consistency.

o Its strategic location allows the transportation of fish meat in optimal conditions,
and permanent and timely access to the central axis markets.

o The availability and alternative, supplementary inputs for fish feeding (banana,

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papaya, cassava, etc.) that allow a considerable reduction in production costs.

o The tradition of consuming fish from the tropical Chapare area conditions a brand
positioning.

o The proximity to fingerling suppliers (PIRAIBA – UMSS) and private suppliers in

Santa Cruz.

3.1.2. Critical factors of success

Mainly, the following critical success factors have been identified for the
development of competitive advantages and institutional consolidation of
TAMBAQUI:

o The raw material suppliers are partners and shareholders of TAMBAQUI.

o The geographical location of TAMBAQUI. It is strategic for the supply, use and
marketing of fish in the national market.

o Production and sales volumes must increase rapidly to be able to access an

economy of scale scenario.

o The quality of the products must remain homogeneous and meet the
requirements specified by customers at all times.

o TAMBAQUI must implement a planned and efficient commercial management

system.

o To open export markets, two aspects must be highlighted: the origin of the
products (Fresh farmed fish

refrigerated from the tropics of Cochabamba) and the partner benefit economic
they generate (strategy to support Alternative Development).

3.1.3. SWOT Analysis

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Strengths

o The existence and operation of the company will allow the promotion of the fish
farming sector in the Tropics of Cochabamba.

o There is backward vertical integration.

o The company's staff is strongly involved in all the company's activities, from the
cultivation of raw materials to their marketing.

o The permanent optimization of production costs will allow the company to achieve
a higher profit margin.

o TAMBAQUI will have a wide range of products for sale, represented in different
presentations and specifications.

o The production modules will be concentrated and close to the collection and
processing plant.

o TAMBAQUI has a policy of achieving loyalty from its suppliers, so activities and
training courses will be carried out, aimed not only at producers, but at their
families, on topics such as accounting, marketing, etc., which at a certain time
contribute to the comprehensive improvement of the company.

Weaknesses

o There are few production modules.

o Limited technological level in production and disease prevention

o Low production volume and uncompetitive internal prices to meet international

demand.

o Lack of scientific research.

o The lack of sufficient working capital could constitute an economic limitation for

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 the company.

o The institution is still in the full phase of strategic and operational organization
(this plan is part of it), this may reflect a certain weakness in attending to and
reacting to important commercial undertakings.

o TAMBAQUI does not yet have ISO 9001:2000 and HACCP (Risk Analysis and
Critical Control Points) certifications, which can constitute a disadvantage when
facing competition and especially the demands of international clients.

o TAMBAQUI does not yet have a website that shows the products, their technical
and commercial specifications, in addition to the services it offers, this is a first-
hand tool that should be developed to be able to serve future clients in an agile
and timely manner. everyone.

Opportunities

o The global trend towards the consumption of white meat, foods rich in protein and
low in fat, implies comparative advantages over other meats.

o TAMBAQUI, like other institutions in the Cochabamba Tropics, has inter-

institutional support.

o The geographical location of TAMBAQUI in the Cochabamba Tropics is strategic from

the point of view of raw material supply and commercial operations, since it allows agile
access to regional markets.

o There is a growing demand at a national and international level, so the sale of the
product with the greatest added value (additional processes, compliance with
standards, etc.) would translate into a greater margin of profitability and market
diversification.

o Fish cultivation is carried out in stages throughout the year, trying to obtain two or
three segmented harvests, which ensures the continuity of sales.

Threats

o The entry of new competitors into the market would cause certain instability.

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o The social, political and economic instability, resulting from the conflict related to
the eradication of coca crops, harms the normal development of growth policies
in the sector, where the transportation component is fundamental.

o The fall in prices in the market could force the company to sacrifice profitability to
remain in the market.

o Natural disasters and weather factors in the production region, usually adverse at
certain times of the year, harm the transportation of raw materials.

o The use of importing agents for marketing in the external market can cause a gap
in distribution (markets can be put at risk due to a poor commercial
interpretation of the intermediaries).

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 3.1.4. Definition of the generic strategy

Chart 3.1 – Position of the generic strategy

TYPE OF COMPETITIVE
ADVANTAGE WANTED

Lower cost Differentiation

Large
representative
sample of
buyers
TARGET MARKET

A limited
segment of
buyers

Source: self made

The previous graph shows the strategic position that is desired to be taken, based
on the sources of competitive advantage, whether cost advantage, product
differentiation or a hybrid strategy, linked in turn to the competitive environment,
that is, if you want compete in a broad market sector or simply in a market segment.

Due to the market characteristics, it is proposed that TAMBAQUI adopt a strategic

position of broad differentiation for the national domestic market and offer
differentiation attributes, transferring added value to the product such as reliability,
safety, hygiene, etc. (attributes that are valued by the market segments shown
above).

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 3.1.5. Definition of the growth strategy

The growth strategy must be considered from two perspectives. The first, related to the
internal market, is a current product in a current market, so a market penetration strategy
must be chosen.

Here management must look for ways to increase the market share of its recent products in
its current markets, investing in global demand, increasing sales, acquiring a market
position, defending that market position, reorganizing undersupplied markets and improving
profitability.

Chart 3.2 – Position of the growth strategy

PRODUCT
Current New

Source: self made

In the second business perspective, the international market must be considered, as
these are new markets with current products. In this sense, a market development
strategy must be chosen.

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 Chart 3.3 – Position of the growth strategy (Cont.)

PRODUCT
Current New

Source: self made

Management must look for new markets whose needs can be satisfied with its current
products, seeking new segments in the international market, new distribution circuits
and geographic expansion.

3.2. Administration and other organizational aspects

a) 2.1. Mission

The following Mission is proposed based on the founding document of the organization
of tropical Aleppo fish farmers:

We act so that the production chain of fish meat and derivatives is vertically articulated
from primary production to distribution and marketing, generating added value and
increasing both the company's profitability and income.

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 for the associated families, while ensuring the food security of the fish farming
families and their communal environment.

b) 2.2. Vision

The following Vision is proposed for TAMBAQUI:

Based on optimal business and quality management, our vision aims to position
TAMBAQUI as a leader in the differentiated production of tropical fish meat in the
Bolivian market, whose economic return provides prosperity to partners, families and
the community.

c) 2.3. Organization chart

Based on all the previous information, and taking into account the aforementioned
strategies, the proposed organizational chart for TAMBAQUI is presented below. (See
Chart 3.5).

Graph 3.4- Proposed Organization Chart

Source: self made

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 3.2.4. Strategic and financial objectives of TAMBAQUI.

Based on the analysis carried out to define the strategy, and as a fundamental part of
this business plan, the following strategic and financial objectives are proposed for
TAMBAQUI.

Strategic objectives

a) Consolidate the backward vertical integration of TAMBAQUI , for the development

of productive activities.

b) Unify the individual efforts of TAMBAQUI associates, guiding them to achieve joint
objectives.

c) Obtain the best quality and homogeneity of products through the design,
implementation and maintenance of a quality control and assurance system.

d) Increase production volumes and use of the modules to access a scenario of

economies of scale.

e) Implement and maintain an aggressive and proactive marketing and sales policy in
the national market .

f) Develop the capacity to compete in international markets.

g) Implement a human resources training system that, in addition to providing the best
qualifications to personnel, constitutes an additional motivation factor, recipient and
manager of new initiatives .

h) Provide a better quality of life to TAMBAQUI associates.

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 Financial Objectives

a) Access an increase in income in the shortest possible time.

b) Increase profits in the shortest possible time.

c) Obtain the highest contribution margins on each product.

d) Obtain higher dividends for all associates.

e) Achieve greater profitability on invested capital.

f) Establish a more diversified income structure based on the manufacturing of

alternative products and providing technical assistance, training and other services.

g) Increase cash flow and maintain sufficient working capital , at all times.

3.3. Production

3.3.1. Plant location

The fish production modules of the “TAMBAQUI Producers Association” have been
implemented in the surroundings of the town of Ivirgarzama located 200 km away.
from the city of Cochabamba and 180 km. of the city of Santa Cruz on the main road
that connects these two departments, having considered in the selection criteria for the
construction of the fish production ponds, the centralization of the beneficiaries in order
to make logistical tasks such as the provision of fry and inputs, as well as harvest and
post-harvest tasks.

For this purpose, the formation of a collection and marketing company that would have
a primary processing plant has been proposed.

to differentiate the product by giving it added value. In the same way, the Association is in
the process of identifying the land for the construction of the fish processing plant in the
most easily accessible place for all the producers of the association.

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3.3.2. Infrastructure and facilities

The association, having been recently implemented, has 50 new ponds, each of
approximately 1000 m2 in production area and has planned for the current
administration (2004) the construction of another 50 ponds of the same dimensions to
reach the projected production of 50 Tm in management 2005.

The construction of the ponds has been supervised by an external advisor and we
believe that the design and dimensions are appropriate for this type of cultivation.

It is necessary to build 2m concrete ponds as soon as possible. long by 1m. wide in

each production module to facilitate harvesting tasks, collecting the fish destined for the
processing plant and pre-filtering the fish before entering the slaughterhouse.

Likewise, for 2004, the construction of the processing plant has been scheduled, for
which we allow ourselves to make some recommendations.

^ The design and dimensions of the processing plant must be in accordance with the
goal of greater production projected by the association.

^ The size of the equipment to be implemented in the processing plant (cold room, ice
factory, conservators, etc.) must be implemented considering the production and
marketing policy (fresh chilled fish) that the company is going to assume to meet its
needs. target markets.

^ To ensure the quality and freshness of the fish, the equipment of the processing
plant has been considered to include a cold room, an ice factory and insulated
refrigeration bins (Bins) that serve to transport whole fish recently harvested from
the ponds. from production to the processing plant, and from the manufactured
product from the processing plant to the markets.

^ Discounting the support environments (office and warehouses), the fish processing
plant must have at least two environments, the dirty room where all the fish will be
handled at the time of reception and the bleeding, gutting and washing the
product and the clean room where the most sophisticated processing tasks will be
carried out such as deheading, filleting and packaging the products for dispatch
to the destination markets.

^ The implementation of 6 production ponds within the processing plant premises is

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 suggested, to develop research activities, mainly those related to the optimization
and adjustment of balanced rations. The dimensions of these pools must be
identical to those of the family production modules, meaning 1000 m2.

^ Likewise, the construction of 1 or 2 concrete ponds is suggested for filtering filter-

feeding species and, optionally, they can be used to purchase fingerlings of less
than 3 grams and carry out their pre-breeding until they reach the optimal stocking
weight of 3 to 5 grams. .

3.3.3. Compliance with occupational safety and hygiene standards

Considering the importance of the individual's role in any production process, the
association must pay great interest to raising awareness of the difference between
its product and the fish traditionally known to it . This will motivate the completion
of certain production procedures that ensure the constant quality of the products. fish
produced and processed by the association.

It is worth taking into account that both the fish production process and the design of the
processing or primary industrialization plant must aim to be susceptible to international
certification.

3.3.4. Design of products

With the understanding that we are working with two linked production processes (fish
production and processing or primary industrialization), we will refer to a single product
of the production process , which is whole fish with viscera ; and a mix of various
products and presentations of the primary industrialization process, these are:

^ Whole fish without viscera in bulk

^ Whole fish without viscera on trays
^ Whole fish without viscera vacuum-packed
^ Bulk HG gutless headless fish
^ Headless fish without guts HG on platter
^ Headless fish without viscera HG vacuum
^ Bulk butterfly cut fish
^ Butterfly cut fish on a platter
^ Vacuum cut butterfly fish
^ Bulk fish fillet

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^ Fish fillet on a platter
^ Vacuum-fed fish fillet

In addition to these presentations, the feasibility of entering more sophisticated

processes such as smoking will subsequently be evaluated, depending on demand and
production volume.

3.3.5. Process design

However, among the shortcomings that every productive process faces in the regional
context, we must refer to those that are specific to fish production and its processing or
primary industrialization, to

We must analyze this effect in the first instance those that refer to the fish
production process in ponds.

Considering the training work and implementation of the communal fish production
modules that PRAEDAC promoted; Some of the beneficiaries have learned many of the
tasks that make up a productive cycle, especially those related to pond conditioning
(liming and fertilization) and fish handling (feeding, sampling, selection, etc.).

We believe that in this new cycle, the support and training for fish-producing
beneficiaries should be oriented toward planning sowing and harvesting , as well as
resource management and fund forecasting for future purchases of fingerlings and
inputs for subsequent production cycles. This will allow them to achieve sustainable
production and adequate self-management capacity.

For the implementation of the plant of the collection and marketing company, as we had
already pointed out in the paragraph referring to infrastructure and facilities, the size of
the plant and machinery to be implemented must be carefully selected.

Below we will refer to the processes and procedures that fish producers and the
processing plant must implement.

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 Graph 3.5- Process diagram for the intensive production of
tropical fish

1. Determination of production volume

ei
ther Quantity of kg. to produce Number of fry required
ei Number of sowings
ther Kg. of food required
ei

2. Pond conditioning or whitewashing

o Fertilization

3. Acquisition of Fingerlings

o Quality assessment
o Choice of suppliers

4. Stocking of fry

either Planting programming

either Logistics and transportation coordination
o Acclimatization

5. Fattening
o Regular sampling of average sizes and weights
o Determination of the daily ration

6. Harvest
o Harvest planning based on the difference in sizes and weights
o Fasting of fish 48 hours before harvest
o Harvesting fish using ice

The processes for producers conclude when the fish are delivered to the person in
charge of the processing plant.

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 Below we will make a brief description of the processes considered in the
processing plant for the fish produced by the fish producers association
“TAMBAQUI”.

As described in Graph 3.5 - Process diagram for the primary industrialization of tropical
fish, the designed processes are not exclusive, meaning that the same product is
susceptible to advancing to the last process or being packaged and marketed after its
first slaughter. This will depend on the preference in demand and the variation in
weights and sizes that the same harvest produces as a result.

Graph 3.5- Process diagram for the primary industrialization of

tropical fish

4. Packaging or presentations

eit In bulk
he In heat-sealed trays
r in vacuum
eit
he

5. Dispatch to distribution or marketing

Registration of product type, net weights, number of pieces and boxes

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 3.3.6. Production capacity

The production capacity of the fish producers association “TAMBAQUI” for 2004 is
projected to reach 50 MT of fish annually with 100 ponds of 1000 m2 each, which gives
us a combined area of 10 hectares of water bodies. available, improving the logistical
conditions for the provision of fingerlings and inputs for balanced feed, we believe that it
is possible to achieve 60 Tm of fish annually with the same number of ponds. In any
case, we believe that the design and size of the plant should be calculated to receive an
annual flow of 100 tons of fish per year, foreseeing a subsequent growth of the
association up to that volume.

3.3.7. Machinery and equipment

Here we will basically refer to the equipment that must be provided to the company's
collection, processing and marketing plant that the association will implement for the
proper management of its production.

Implementing a small cold chain to ensure the freshness of the fish until it reaches the
final consumer will be essential to achieve the positioning of the product as fresh
fish from the Chapare.

Considering the projected production volume and the sales strategy to be implemented,
we believe that the plant should basically have the following equipment:

^ A 3m cold chamber. long by 3m. wide and 2m high.

^ An ice factory with the capacity to produce 350 kg. of ice daily.

^ 25 Bins (Insulated Preservatives) of 100 kg. of load capacity each.

^ A heat sealer.

^ A vacuum packer with the capacity to pack 20 kg. by

hour.

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3.3.8. Required labor

According to the suggested process diagram for the primary industrialization of tropical
fish, and the projected production capacity, the processing plant would require the
following labor force.

^ 1 technician in charge of plant (personnel administration, inventory and product

movement)

^ 1 commercial assistant (customer contacts, product dispatch, collections, etc.)

^ 1 responsible for warehouses and records (machinery control, provision of ice,

knives, packaging, etc.)

^ 2 cutters (eviscerators and headers)

^ 3 fish washing machines and packing plants.

^ 3 filleters.

It is very likely that at the beginning of the processing plant's activities, only 50% of the
personnel suggested above will be required.

3.3.9. QA

Establishing a quality control system within the framework of a comprehensive quality

management system for the fish producers association “TAMBAQUI” could be the
subject of a broad and intense study, but we believe that with the implementation or
consideration of certain elements that allow The management of quality products will be
able to offer a homogeneous product from its production phase, through its
transformation or primary industrialization until its final commercialization in the
identified markets.

For the fish production phase, the first link in this productive chain, we suggest the
following elements.

^ Pond conditioning work (liming and fertilization) must be standardized for all
production modules.

^ The purchase of fry per production cycle must be from the same supplier for all
production modules.

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^ A food with a unique composition or balance must be validated using local and
some external inputs for all producers.

^ The work of acclimatization and stocking of the fry must be carefully carried out to
avoid mortality due to the stress to which the fish are subjected due to the change in
their living environment.

^ Periodic (monthly) sampling of the size and weight of the fish, to establish a
daily ration or feeding rate , should be a consistent task to guarantee uniform
growth of the fish in all production modules.

^ It is essential to fast the fish 48 hours before harvest . The work of harvesting
the fish and handling them, as well as placing them in refrigerated transport
containers with ice, must be carried out carefully, trying not to mistreat the fish, thus
avoiding bruises or crushing of the muscle tissue that affect the quality of the
product in its final presentation.

For the processing plant, it is recommended to consider the following quality control
elements.

^ The reception of the fish and their disposition for gutting must have a constant
replenishment of ice to ensure its freshness until its final destination.

^ The handling of the fish should always be delicate, taking care not to throw the fish
into the work containers, but rather to arrange them , so as not to hurt them during
the entire process.

^ Gutting, deheading and filleting must be carried out with appropriate and properly
sharpened utensils (knives) to avoid errors in the cuts that affect the quality of the
fish until packaging.

^ The packaging of the fish must be carefully carried out, ensuring that fish or fillets
of the same size, color and external appearance are always accommodated in
the same packaging.

^ By applying all these recommendations, products of homogeneous quality will be

obtained during all production cycles.

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3.3.10. Logistics and operations

It is essential to ensure customers a continuous and not a seasonal supply of the

products that the collection and marketing company will offer for marketing.

In the fish production process, the stockings in the ponds should be alternated or
staggered, scheduling them according to the availability of the fry. This will allow
obtaining cyclical productions that are linked and allow a continuous weekly flow of fish
harvested at the same time. processing plant and subsequent distribution to the
markets.

Taking into account the projected fish production volumes (60,000 Kg. annually = 5000
Kg. monthly) we believe that the plant should operate a regular and sustained flow of
1250 kg. of fish weekly in two processes of 625 kg. each one, to avoid freezing the
products and ensure the delivery of the product to the final consumer as Fresh
Refrigerated Fish from Chapare Cochabambino

3.4. Marketing and sales

3.4.1. Demand study

Domestic demand

The demand for tropical fish meat, represented mainly by the species Surubi, Pacu,
TAMBAQUI, Dorado, Sábalo, Tilapia and others in a lesser proportion, has been
segmented, by species and price in hotels, restaurants, supermarkets, regional markets
and popular markets, There has been a significant increase in demand, especially in
high seasons, particularly during Easter.

Likewise, the trend towards the consumption of white meat for health reasons, the
affordable price, habits and promotion through regional fish fairs have caused a growing
internal demand, which results in the development of new products with greater added
value.

International Demand

As can be seen in the following table (Table 3.1), within the total production of
aquaculture, fish production (fish farming) itself is the main one and amounted to 23

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million tons in 2000, which represents approximately 65 percent. of total aquaculture
production. Most of this total was carp (68 percent of total fish production in 2000),
which are consumed locally in producing countries (mainly China and India).

Table 3.1 - World fisheries production (in millions of tons),

in the period from 1994 to 1999

Production 1994 1995 1996 1997 1998 1999

Sweet water 18,8 21,4 23,4 25,1 26,7 28,0
Capture 6,7 7,2 7,4 7,5 8,0 8,2
Aquaculture 12,1 14,1 16,0 17,6 18,7 19,8
Source: www.desenvolvimento.gov.br/arquivo/sti/publicacoes/futAmaDilOportunidades/futAmazonia_0

One of the species whose production has increased dramatically is tilapia (aquaculture
production of tilapia and other cichlids totaled approximately 1,265,800 tons in 2000).
International trade, although limited, is growing, especially between Central American
producers (Costa Rica, Ecuador and Colombia) to the United States, and between
Asian producers (Taiwan Province of China, Indonesia and Thailand) to Japan and the
United States. . There is also more modest trade between Jamaica and the United
Kingdom. The largest exporter, Taiwan Province of China, supplies Japan with high-
quality tilapia fillets for its sashimi market, as well as frozen tilapia to the United States
market (40,000 tons in 2001). Taiwan Province of China exports approximately 70
percent of domestic tilapia production. Thailand and Indonesia export less than 5
percent of their production. Viet Nam has recently entered the international tilapia
market, and China exported 12,500 tonnes to the United States in 2001.

In the United States, tilapia is now the third most imported aquaculture product by
weight (56,000 tons in 2001), after shrimp and salmon. Imports into the United States
have grown rapidly and are expected to continue to do so in the future.

Brown catfish are currently the fifth most consumed fish in the United States (0.5 kg
edible weight per capita in 2000), and domestic production reached 280,000 tons in
2000. Exports are minimal because production is directed to the domestic market. The
reason for the success of brown catfish is the similarity of its meat to that of tilapia: there
is strong consumer demand for easy-to-prepare white fish fillets.

On the other hand, the supply of groundfish was very limited in the first half of 2001.
Supplies of groundfish (Alaska pollock); They were reduced in all the main markets, and
lower catches of (cod and hake) were also recorded, with the consequent decrease in
supply. Prices did not rise as expected (Table 3.2) since other species (salmon and
tilapia) are replacing groundfish in many markets.

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 Table 3.2 – Groundfish (c&f) prices in the united states

Source: FAO Globefish

In recent years, the following important issues have been raised in international trade in
fishery products: changes in quality control measures applied by the main importing
countries with a view to applying a preventive strategy based on Hazard and Critical
Point Analysis control (HACCP).

The EC and the United States made HACCP plans mandatory for all facilities that
produce fish products for their markets. While the United States applies these measures
through its importers, the EC carries out its control through the competent authorities in
the exporting countries.

Export Logistics

As is already common in many sectors, transportation is still a disadvantage also in the

fish meat production chain, due to the delicate nature of its meat. Once the product is
packaged and depending on the markets, prices and volumes achieved, the type of
transport to be used will be defined, in any case if we take into account

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 The successful experiences of exporting trout by air carried out by the company “Productos
titikaka SA” allow us to deduce that the handling and export of fish should not have
complications that affect the viability of opting for foreign trade of the fish produced by the “
“TAMBAQUI Fish Producers Association”

In case of export by land, costs will vary according to the offer, distance and place of delivery of
the merchandise. For example, a 40 cubic foot container, consolidated, loads 400 qq of 50 KG
on pallets (20,000 to 25,000 KG). In the following table (table 3.3), the costs of transporting a
container, insurance and others can be shown:

Table 3.3 Transportation costs of a 40 cubic foot container

Transportation cost Chapare – Arica* 1320 $US
Transportation cost Chapare – Pocitos 1210 $US

Transportation cost Arica – Santiago 1760 $US

Transportation cost Pocitos – B. Aires 1870 $US
Transportation cost Arica – Hamburg 3740 $US

Transportation cost Chapare – Hamburg 4620 $US

Insurance 150 to 250 $US

Dispatchers 1.5 to 3.5 About FOB value

Various aliquots 0.5 to 1.5 About FOB value

* The costs have considered an additional 10% for cooling Source: UNIX (2004)

3.4.2. Commercial strategy

3.4.2.1. Product definition

It is proposed to develop four types of products, detailed in table 3.4 with three different
presentations, which offer elements of differentiation, given mainly by the type of cut, the
packaging and the form of presentation, with the purpose of covering the different

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 needs that have been identified in the market segmentation analysis.

Table 3. 4 - Description of product characteristics

Characteristics Presentation type Code Tradename

Whole fish – without visors In bulk
In trays – thermo sealed
in vacuum
Headless fish without In bulk
viscera HG
In trays – thermo sealed
in vacuum
EGG
^ Pacú a Bulk
^ Bulk Tilapia
EGT ^ Pacú on a platter
^ Tilapia on a platter
EGV
^ Pacú in the vacuum
^ Vacuum Tilapia
HGG ^ Pacú headless in bulk
^ Bulk Headless Tilapia
HGT
^ Pacú headless on a platter
^ Headed tilapia on a platter
H.G.V. ^ Pacú HG vacuum Tilapia HG vacuum

Fish Court In bulk BTG

butterfly, without head, ^ Pacú butterfly in bulk
without viceras, without ^ Bulk Butterfly Tilapia
tail In trays – thermo sealed MTB ^ Pacú butterfly on a platter
^ Butterfly tilapia on a platter
in vacuum BTV
^ Pacú vacuum butterfly
^ Vacuum butterfly tilapia
Fish steak In bulk F.G.
^ Bulk pacú fillet
^ Bulk Tilapia Fillet
FT ^ Pacú fillet on a tray
In trays – thermo sealed ^ Tilapia fillet on a tray
in vacuum F.V.
^ Vacuum pacú fillet
^ Vacuum Tilapia Fillet
Source: self made

The purpose of the different types of presentation is based on the proposed market
penetration strategy, for example, products with bulk presentation have the vice of similar
characteristics with the products on the market. However, it should not be forgotten that fish
meat will be sold “chilled” and “fresh”, thus providing differentiation of the product from that
of the competition. In the same way, the product will be differentiated through the different
types of cuts, with tray and vacuum presentations.

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 It can be seen in table 3.5, the micro segmentation analysis assigns to each product the
needs identified by each sector. For example, in the popular market sector, for the C3
stratum (low income) the product to cover the functions of nutrition, natural health, flavor and
versatility will be “whole fish without visors” with a “bulk” type of presentation. .

Table 3.5 Assignment of products to micro segmentation

Popular markets Zonal fairs and markets Supermarkets Restaurants

Features
ABC1 C2 C3 OF ABC1 C2 C3 OF ABC1 C2 C3 OF ABC1 C2 C3 OF

FT,FV,
FT,FV,
HGT,H
Nutrition EGG EGG HGT, BTT HGT HGT,HGV, BTT,FT BTG,HGG EGG EGG
GV,BTT,B
BTT,BTV
TV

FT,FV,
Natural health EGG HGT, BTT ,, HGT HGT,HGV,
BTT,FT BTG,HGG EGG
HGT,H

G V ,B TT
BTT,BTV , BT V

FT,FV,
FT,FV,
HGT,H
Flavor EGG EGG HGT, BTT HGT HGT,HGV, BTT,FT BTG,HGG EGG
GV,BTT,B
BTT,BTV
TV

FT,FV,
,, HGT HGT,HGV,
Versatility EGG HGT, BTT HGT,H BTT,FT BTG,HGG EGG EGG
G V ,B TT
BTT,BTV , BT V

FT,FV,
FT,FV,
HGT,H
Status HGT,HGV, BTT,FT BTG,HGG
GV,BTT,B
BTT,BTV
TV

Hotels Hospitals Quarters

Features
ABC1 C2 C3 OF ABC1 C2 C3 OF ABC1 C2 C3 OF

FT,FV,BTT, BTT,BTG,HG
Nutrition HGG EGG BTT,FT HGT,BTT HGT,EGT EGG BTT,HGT HGT
BTV T,HGG

FT,FV,BTT BTT,BTG,HG BTT,FT HGT,BTT HGT,EGT EGG BTT,HGT HGT

Natural health ,BTV T,HGG

FT,FV,BTT, BTT,BTG,HG
Flavor BTV T,HGG HGG BTT,HGT HGT

FT,FV,BTT BTT,BTG,HG
Versatility HGG EGG BTT,FT BTT,HGT
,BTV T,HGG

FT,FV,BTT,
Status BTV

Source: self made

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 3.4.2.2. Market analysis

Initially, due to their proximity to production centers, the cities of Santa Cruz and
Cochabamba have been identified as potential markets. For each of these urban centers,
different methodologies have been determined in order to collect reliable information.

Below we will describe each of these analyses.

For the analysis of the Santa Cruz market, probing surveys have been carried out in the
main fish market (Mercado Florida) and two traditional distributors, fish marketers. The
survey model is shown in Annex V, and its results are shown in Annex VI.

Table 3.6 summarizes these surveys with their respective observations and comments.

Table 3.6 Summary - Fish Market Survey Survey

Santa Cruz

Species Min. Weight Origin Presentation Prices Average

Kg. High Low
Pacu – TAMBAQUI 2,6 Beni Whole 25,29 20,29

Fillet 35,74 32,49

Chop 28,30 26,30
Surubi 5,3 Beni Whole 25,71 21,71
Fillet 35,86 32,61

Chop 28,63 26,63

croaker 2 Beni Whole 17,86 14,86
Piranha 0,5 Beni Whole 15,33 12,50
Golden 2 Villamontes Whole 20,29 15,71
Shad 1 Villamontes Whole 12,00 8,00
Observations

*None of the merchants would receive farmed fish less than 2 kg. unit weight
* Some received 0.5 kg crop pacus. at 12 and 13 Bs.c/Kg. and it took them months to market them

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 * The Pesca SRL fishmonger would receive up to 1000 kg per week of pacus of more than 2 kg each at 17Bs.c/Kg.
* The Santa Cruz fishmonger received pacus weighing 1Kg each 18Bs. c/Kg and sold it for 21 Bs.
* Most of the steak sold as Surubi is Paiche
* According to the merchants in the Florida market, they sell between 70 and 150 Kg. weekly.

Source: self made

For the analysis of the market in the city of Cochabamba, the methodology used to
categorize potential clients has been based on “in-depth interviews with experts”, as well as
opinion polls with old and traditional tropical fish marketers, on the other hand, is taking into
account for the city of Cochabamba (fenced) the “Percentage volume of fish consumption by
Zones in the city of Cochabamba”, and the “Percentage distribution of preferences by
species ” from the market analysis work carried out in the thesis “Prefeasibility project for the
installation of a trout processing center” by Fabián Claros, detailed below, in tables 3.7 and
3.8 respectively. To support the quality of the information, the profiles of the experts have
been defined according to the following detail:

^ Years of experience in the field.

^ Years of specific experience in the Chapare area.
^ Involvement in production processes.
^ Involvement in marketing processes.
^ Knowledge of the domestic and international market.

It is worth clarifying that the opinion of the experts as well as that of the marketers showed us a
clear image or definition of the supply volumes traditionally managed by them and that were
always below the demand in their marketing positions, which gives rise to project yourself
positively in these points of sale.

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To prepare the list of potential clients, the opinions previously stated have been taken into account, in the
segmentation format already presented (annex IV shows the list of the most important clients).

Table 3.7 - Percentage volume of fish consumption by area

in the city of Cochabamba

Residential area 44.6%

intermediate zone 24.8%

popular area 30.6%

Source: Pre-feasibility project for the installation of a trout processing center” by Fabián Claros

Table 3.8 - Percentage distribution of preferences by species for

the city Cochabamba

SURUBI 31.9 %

PEJERREY 29.93%

TROUT 21.38%

SHAD 13.82%

PACU 1.64%

GOLDEN 0.66%

OTHERS 0.66%

ALL 0.66%

Source: Pre-feasibility project for the installation of a trout processing center” by Fabián Claros

3.4.2.3. Competitor analysis

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Competitor analysis

The competition has been located basically in the department of Santa Cruz, due to its
physiographic characteristics and the existence of companies that have been in the field for
some years.

Two companies have been identified that produce their own fingerlings and that have
already ventured into fattening tambaquis, pacus and Tambacus (Hybrid between tambaqui
and pacu), however, since the production of fingerlings is only in its second year of
production successful, the first experiences have been in fishing centers and recently, due to
the high levels of production of fingerlings from the last spawning, an interesting volume is
being fattened in intensive systems to release fish meat to the Santa Cruz market.

On the other hand, the demand in this market for large fish of no less than 2 kg. of unit
weight, will allow the “TAMBAQUI” association to compete with the product differentiated by
its presentations and added value.

We believe that the market is fully open and that it will depend on the speed and quality with
which it is penetrated to captivate it and achieve quotas with volumes that allow the
production projected by the “TAMBAQUI” association to be marketed.

The following table shows the most representative producers of the competition and market
segments:

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 Table 3.9 List of competitors by brand and market segment
Name of
Brand Segment of Department
the market
competitor
1. Mr. Chacho Echo Fishing Fish and pay, for Santa Cruz
Serrate “Vallecito SRL.” segments
ABC1, C2 and C3
2. Dr. Alan “Tonoshiro” ABC1, C2, C3, DE Santa Cruz
Antezana Aquaculture
3. Dr. Navil Curcuy The Prado UGRM ABC1, C2, C3, DE Santa Cruz

Source: self made

The identification of these competitors has contemplated the most representative ones,
considering the type of competition - for example in the case of “Catch and pay”, whose
reaction patterns are quite aggressive, due to the growing incursion of various loopholes that
offer this type of service and that consumers are accepting very strongly. If the state of
competitive relations is taken into account, it can be concluded that the TAMBAQUI
association currently cannot face this type of competition, first due to the conditions that the
competition offers to clients, from canoe rentals, fishing equipment , rental of grills and
recreation spaces, the recommended action for the TAMBAQUI association, in a first stage,
develop the environments and gaps that can offer this type of service, and then attack that
captive market segment, also covering consumers from Santa Cruz, to those from
Cochabamba.

3.4.2.4. Sales forecast

The sales forecast, expressed in kilograms, is explained in the following table (table 3.10),
detailing the types of products, for the next five years.

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 Table 3.10 Sales forecast

Product Year 1 Year 2 Year 3 Year 4 Year 5

Kg. Fish without guts
20%
1326 5304 5304 5304 5304
Kg. Fish without guts
and head HG 35%
2065 8261 8261 8261 8261
Kg. Butterfly cut fish 3
0% 1770 7081 7081 7081 7081
Kg. Fish fillet 15%
835 3342 3342 3342 3342
Source: self made

The amount of these sales expectations has considered the cost of transportation and
services, as detailed in table 3.12:

Table 3.11 Transportation and service costs

Transport Year 1 Year 2 Year 3 Year 4 Year 5

Freight (from the modules to the plant) $ 960 $ 960 $ 960 $ 960 $ 960
max.20Km
Services
Water $us monthly 120 120 120 120 120
Electric energy $us monthly 120 120 120 120 120
Telephone $us monthly 120 120 120 120 120
Source: self made

3.4.2.5. Marketing plan

To formulate the marketing plan, the marketing mix (Marketing Mix) has been developed,
according to the product, price, distribution and communication, as described below:

Product :

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 The range of products, described in table 3.4, identifies the fundamental characteristics of
the products to be marketed, the form of presentation, the benefits and the commercial
name. Similarly, table 3.5 describes the assignment of products to the different market
segments identified in the micro-segmentation analysis.

Price :

To determine the sales price, prices have been investigated through an assessment of the
Santa Cruz fishing market, chosen as the main reference because it has the greatest
representativeness of competitors. In this sense, it is recommended that a strategy of equal
prices be adopted, since under this strategy, prices are equal to those of the competition, but
differentiating and exclusive elements of the product are highlighted, such as hygiene, the
type of packaging. and the freshness of the product.

It has been considered that the price of the raw material (purchased from the producer) is
Bs. 13 per kilogram; From this price, the variables of slaughter factor, processing cost,
packaging cost and utility have been included, which are described in the financial tool,
annexed to this business plan. In this sense, the sales forecast is in direct correlation with
the financial projections, within a “probable scenario.”I , as indicated in the following table
(table 3.12):

Table 3.12 – Price of products

Product Year 1 Year 2 Year 3 Year 4 Year 5

Fish without guts 18,96 18,96 18,96 18,96 18,96

Fish without guts HG 23,89 23,89 23,89 23,89 23,89
Butterfly cut fish 24,84 24,84 24,84 24,84 24,84
Fish steak 26,73 26,73 26,73 26,73 26,73
Source: self made

I For sales projections, three scenarios have been taken into account, a probable, an optimistic and a pessimistic .
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 Distribution:

The recommended distribution will make it possible to make the different products available
to the different consumer segments. Thus, the distribution channels are in direct relationship
with the consumers identified in the micro segmentation, as shown in table 3.13:

Table 3.13 Distribution of products according to market segment

and distribution channel:

Code of Consumer segment Distribution channel

Product
EGG C3, DE
Popular markets, Restaurants, Hotels, Hospitals
EGT
EGV
HGG C2 Restaurants and Hotels
HGT ABC1, C2, C3 Local markets and fairs, Hotels, supermarkets,
Hospitals and barracks
H.G.V. ABC1, C2 Supermarkets
BTG C2 Restaurants and Hotels
MTB ABC1, C2 Supermarkets, Hotels, Hospitals and barracks
BTV ABC1, C2 Supermarkets and Hotels
F.G.
FT ABC1,C2
supermarkets, Restaurants, Hotels,
hospitals
F.V. ABC1,C2 Supermarkets and hotels
Source: self made

Communication:

The means of promotion and advertising will be developed according to the following
scheme:

o Brochure or institutional catalog (Option: triptych) that shows TAMBAQUI

as a solid and profitable company, highlighting the quality of the product and
providing sufficient information and

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specifications about it to attract the customer's attention. It is advisable to manage two types of catalog:
one for export and another for the domestic market; The reason for this is the socio-cultural difference
and requirements of both markets.

o Participation in fairs and events; This is a low-cost promotional element with massive
reach, through which the company and the product are not only shown with the
purpose of attracting new consumers (through an exhibition or business conference)
but also to achieve a reinforcement in customer loyalty. customers (direct
advertising).

o During the time of low demand, highlight the quality of the product and the benefits of
the service provided by the company through relationship marketing.

3.5. Finance

For the economic and financial analysis of TAMBAQUI, a tool has been developed to simulate
financial statements over a period of five years, using interactive Excel spreadsheets. The tool was
designed to simulate different scenarios according to the awareness of variables such as price,
demand, costs, etc. This simulation can be carried out from the perspective of the “producer”, the
“producer association” and the “processing company”. A copy of the tool has been attached on CD
to this work. Likewise, an interactive course has been developed on the use of the tool, its
calculation base and input data.

Considerations and assumptions for the 2004-2008 budget projection

For the analysis of budgetary control, conservatively feasible variables have been proposed, the
characteristics of each of them are cited below:

Regarding the producers association:

1. The participation of the 25 partners already established in the first year has been considered,
with 50,000 m2 of mirror water, and a net production of 6,630 Kg. of fish, a figure that results
from the stocking of fingerlings carried out by PRAEDAC.

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 2. For the second and subsequent years, the conclusion of the implementation of the 50 family
production modules projected by PRAEDAC has been considered, with 100,000 m2 of total
water surface and a net production of 26,520 Kg. of annual fish.

3. The stocking density of fish per m2 has been estimated conservatively, taking into account
the experience of the first year in terms of regular availability of fry, achieving the density of
one fish per m2 from the second year onwards.

4. The average unit weight of the harvest has initially been considered 400 gr. Per fish, this will
be adjusted depending on the market and its demand.

5. Production indicators, such as survival, conversion rate and others, have been raised
conservatively, in relation to the rates that are regularly used in the sector.

6. The assumed sales price is 13 Bs per kg, this allows the producer positive results from the
third year, considering the appropriate stocking density (1 fish/m2) and two additional ponds,
that is, 4000 m2 of mirror. water (four ponds).

Regarding TAMBAQUI as a collection, transformation and

marketer:

1. The purchase volumes of raw materials (whole fish without visors) have been projected by
directly relating them to the production that the producer association achieves annually.

2. The utilization percentages (slaughter factors have been considered conservatively, in relation to the
percentage of waste regularly used).

3. The suggested product mix shows for the first year small volumes of processed fish that can
be processed artisanally to introduce them into the market segments, and these can be
adjusted according to demand.

4. The price list for each product after the transformation process has considered the difference
by slaughter factor from whole fish to its final presentation and an additional profit for
services.

5. The suggested prices leave room for profits for intermediaries, without moving away from
the prices at which tropical species are currently marketed without any added value.

6. TAMBAQUI can start operating from the first year, marketing the fish from the first harvest,
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 creating a minimal administrative structure that gets to know the market and acquires
experience in business management.

7. Taking into account the aforementioned assessments, TAMBAQUI shows positive results
from the first year, increasing its profit proportionally to the volume processed and marketed,
with values of $us. 1788 for the first year and $us. 7154 since the second year

3.5.1. Investment requirement

Table 3.16 shows the investment required by TAMBAQUI for the first year of operation,
amounting to a total amount of $us 35,500 .

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 Table 3.16 – Investment in civil works and equipment.

Civil Works and Equipment Amount Total $us

1 20000
Processing plant (land, offices, warehouse, rooms)
Cold chamber 1 8000

ice factory 1 2000

Conservative bins 100 kg./cu 25 2500
Heat sealer 1 500
Vacuum packing machine 1 2000
Accessories Global 500
Source: self made

3.5.2. Funding sources

Once the PRAEDAC financing ends, the company, depending on its performance, could access
private financing as it has a guarantee of its assets. The downward trend in interest rates in the
country is an indicator that would favor investment.

In order to cover immediate financial needs, when a negative cash flow occurs, it is proposed to
manage a line of credit with a rate of 12% for five years. The modification of these parameters in
the financial tool is feasible if required.

3.5.3. Cost sheet

The projected costs for the next five years are described in the following table (table 3.17),
taking into account salaries, materials, supplies, transportation costs and cost of services:

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 Table 3.17 – Cost Sheet

Remunerations Year 1 Year2 Year3 Year4 Year5

1 Tech. Plant manager $us/month 4800 4800 4800 4800 4800

1 Commercial assistant $us/month 3600 3600 3600 3600 3600

1 Warehouse and supplies manager $us/month 3600 3600 3600 3600 3600
2 Eviscerators (8 wages per month) $us/day 672 672 672 672 672

3 filleting machines (8 wages per month) $us/day 1008 1008 1008 1008 1008

3 Packers (8 days per month) $us/day 1008 1008 1008 1008 1008

Plastic baskets 30 kg/cu Units 150 150 150 150 150

Materials and supplies Year 1 Year2 Year3 Year4 Year5

Plastic baskets 30 kg/cu Units 150 150 150 150 150

Ice kg. Year 1 530

Ice kg. Year 2 2122

Ice kg. Year 3 2122 2122 2122

Knives units 12 12 12 12 12

Cloths (dryers) linear meters. 50 50 50 50 50

Covering polyethylene film (roll). 100 100 100 100 100

Heat-sealed PVC film (roll) 100 100 100 100 100

Vacuum packaging bags units 1500 1500 1500 1500 1500

Packing trays units 445 445 445 445 445

Raw material Year 1 Year2 Year3 Year4 Year5

Whole fish without viscera Kgrs/$us year 1 10910 0 0 0 0

Whole fish without viscera Kgrs/$us year 2 43641

Whole fish without viscera Kgrs/$us year 3 43641 43641 43641

Staff salaries are around $14,688; These are within the salary levels established for the tropics,
both for technicians and for skilled labor.

The materials and supplies have been calculated in relation to the volume of fish meat to be
processed in the processing plant.

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 Table 3.18 - Economic technical sheet for the processing plant
Primary fish (Expressed in dollars)

AMOUNT
ITEM AMOUNT
Year 1 Year 2 Year 3 Year 4 Year 5
Civil Works and Equipment
Processing plant (land, offices, warehouse
1 20000 0 0 0 0
Cold chamber 1 8000 0 0 0 0
ice factory 1 2000 0 0 0 0
Conservative bins 100 kg./cu 25 2500 0 0 0 0
Heat sealer 1 500 0 0 0" 0
Vacuum packing machine 1 2000 0 0 0 0
Accessories Global 500
35500
Remunerations
1 Tech. Plant manager $us/month 400 4800 4800 4800 4800 4800
1 Commercial assistant $us/month 300 3600 3600 3600 3600 3600
1 Warehouse and supplies manager $us/month 300 3600 3600 3600 3600 3600
2 Eviscerators (8 wages per month) $us/day 3,5 672 672 672 672 672
3 filleting machines (8 wages per month) $us/day 3,5 1008 1008 1008 1008 1008
3 Packers (8 days per month) $us/day 3,5 1008 1008 1008 1008 1008
14688 14688
Materials and supplies
Plastic baskets 30 kg/cu Units 60 150 150 150 150 150
Ice kg. Year 1 6630 530
Ice kg. Year 2 26520 2122
Ice kg. Year 3 26520 2122 2122 2122
Knives units 24 12 12 12 12 12
Cloths (dryers) linear meters. 100 50 50 50 50 50
Covering polyethylene film (roll). 1 100 100 100 100 100
Heat-sealed PVC film (roll) 5 100 100 100 100 100
Vacuum packaging bags units 10000 1500 1500 1500 1500 1500
Packing trays units 5000 445 445 445 445 445
2887 4479
Raw material
Whole fish without viscera Kgrs/$us year 1 6630 10910 0 0 0 0
Whole fish without viscera Kgrs/$us year 2 26520 43641
Whole fish without viscera Kgrs/$us year 3 26520 43641 43641 43641

Mix and percentage of usable whole weight

Kg. Fish without guts 20%
78% 1326 5304 5304 5304 5304
Kg. Fish without guts and head HG 35% 67% 2065 8261 8261 8261 8261
Kg. Butterfly cut fish 3 0% 67% 1770 7081 7081 7081 7081
Kg. Fish fillet 15% 62% 835 3342 3342 3342 3342
5997 23987 23987
Transport
Freight (from the modules to the plant) max.20Km $us 20 960 960 960 960 960
p
Services
Water $us monthly
10 120 120 120 120 120
Electrical energy $us monthly 10 120 120 120 120 120

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 3.5.4. Analysis of the income statement

The income statement of TAMBAQUI presents a value of $us in the first year. 7,395, which tend
to increase constantly from the second to the fifth year, reaching a value of $us. 17.555.

The analysis carried out according to the sales and the investments that are intended to be
made result in a net cash flow with positive values in the five years. The cost-benefit ratio is low,
11 cents recovered per dollar invested, but taking into account that the processing plant's basic
function is to capture the entire production, it will contribute to the socioeconomic development
of the region.

Table 3.19 – Income statement

MOVEMENT OF THE INCOME STATEMENT

□ AFTER TAX BENEFITS

Source: self made

The analysis carried out according to the sales and the investments that are intended to be
made result in a net cash flow with positive values in the five years. The cost-benefit ratio is low,
11 cents recovered per dollar invested, but taking into account that the basic function of the
processing plant is to capture the entire production, it will contribute to the socioeconomic
development of the region .

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 Table 3.20 Cash flow, cost benefit ratio
(Expressed in dollars)

YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5

CASH FLOW 7.395,82 17.555,52 17.555,52 17.555,52 17.555,52

COST BENEFIT 1,11 1,11 1,11 1,11 1,11

RELATION

IRR 12,08%
GO 128,89
RATE 12,00%

The return obtained is 12% at a 12% discount rate, achieving a discounted value of $ 128.89
per year.

3.5.5. Balance Sheet Analysis

The financial structure proposed for TAMBAQUI shows a lack of liquidity or availability of
resources to cover short-term obligations, for this reason the treasury accounts present negative
results. On the other hand, the shortage of own funds can increase in the future either through
capital injection or retention of profits, converting them into reserves; To give you a clearer idea,
a table has been created that refers to the general balance projected for the fifth year, which is
described in Annex VII.

3.6. Investigation and development

In the globalized environment in which we live, technological competitiveness and the quality of the
products offered play a predominant role. Staying technologically current requires a systematic
policy of research, development and improvement of products, accompanied by qualified human

3.6.1. Identification of the need or not for a strategy

Investigation and
development
resources managing the processes.

A large majority of fish meat processing industries face, as we already mentioned, two
significant obstacles to their development: low rates of human resource training and lack of
appropriate technology. These especially affect companies belonging to Small and Medium
Enterprises, a sector to which TAMBAQUI currently belongs.

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 The scientific-technological infrastructure of the food industrial sector in our country has not
generated the tools and information necessary to incorporate this valuable resource into the
production process to the extent appropriate to its frontier of possibilities, thereby postponing
valuable years of economic and industrial benefits. There is a real need to start a serious
research and development venture in the food industrial sector, specifically on fish meat
processing, and TAMBAQUI could be the pioneer institution.

We believe that the degree of base information that will be available, the capabilities and
experience of the human resources that TAMBAQUI will have, added to the facilities that the
laboratories and specialists of universities and companies, public and private, national and
international, incorporate, They would allow research and development projects to be
adequately addressed with a high probability of success in achieving their objectives.

3.6.2. Definition of the Research and Development strategy

Despite the importance for TAMBAQUI of implementing a research and development policy,
there are currently no economic or technical conditions to do so systematically in the short term.

TAMBAQUI is in a period of strategic and operational consolidation and must first address
aspects that articulate its efforts towards the achievement and maintenance of new markets,
with optimal quality products.

In the short term, TAMBAQUI should outsource research and development services for new products and
processes, either by resorting to private sector companies, or by establishing service exchange
agreements or inter-institutional cooperation with universities or technical institutes.

In the medium term, it would be advisable for TAMBAQUI to carry out research and
development work, in its facilities and with its own equipment, within the framework of a planned
testing system.

3.7. Human Resources

3.7.2. General features

It is necessary to prepare function manuals, from which opportunities for improvement can be
found, especially regarding the definition of job profiles for managerial, administrative,
commercial and plant personnel, as well as carrying out evaluations. periodic evaluations of
performance and the identification of training needs.

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 3.7.3. Implementation of a comprehensive training program

As mentioned previously, one of the strengths of TAMBAQUI is that in addition to being

dedicated to the marketing and transformation of fish meat, it has the capacity to provide
services to its associates such as: technical and extension assistance, comprehensive training
and transportation of raw material.

It has also already been noted that a large part of small and medium-sized companies in our
country face two significant obstacles to their development, which significantly reduce their
technological competitiveness:
a) low training rates of its human resources and b) lack of appropriate technology.

We believe that with a reduced investment, TAMBAQUI could increase its training offer and
position itself in the country's fish farming sector as

trained human resources management entity. In addition to being a very useful strategy to
recruit new associates, guarantee the adequate supply of raw materials and standardize the
quality levels of their products, it would allow homogenizing the technical qualification levels of
associates and non-members, which would benefit the entire sector. dedicated to fish farming .

3.8. Information systems

In the diagnosis carried out on the TAMBAQUI company, it was noted that it has an information
system, not computerized, in which some of the results of the activities carried out are reflected
through forms.

It is appropriate to propose the implementation of a planned information management system. This

should be organized according to the following scheme:

o Identification of information requirements according to area

o Implementation of the information system considering the following basic points:

^ Report type and content

^ Production manager

^ Recipient

^ Production frequency

^ Delivery time

^ Maintenance, evaluation and improvement of the

^ information system

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 o Computerization of the information system

The preparation and discussion of one or several reports, periodically, allows the identification of
problems, feedback of concepts related to possible solutions and the timely monitoring of the
variables that affect each department.

4. CONCLUSIONS

^ In relation to the general objective and expected results: A Business Plan has been designed for the
TAMBAQUI company, which responds to its current needs and situation and which, if implemented,
will lead it towards a strategic and operational improvement plan , effective implementation and
institutional consolidation.

^ In relation to the first specific objective: An initial diagnosis of the operation of TAMBAQUI has been
carried out, the areas and aspects susceptible to improvement have been identified and the
information has been organized in a format similar to that of the proposed plan, which allows
carrying out an evaluation of its effectiveness by comparing current and future scenarios.

^ In relation to the second specific objective: With the development of the Comprehensive Business
Plan, a work tool has been established that, in addition to serving in planning and problem-solving
tasks, will guide the company's executives in all areas. other strategic, operational and financial
management tasks.

^ In relation to the third specific objective: Action and improvement plans have been designed and
proposed, in general, for each area of the TAMBAQUI company. Their extension has been affected
by the delimitation in scope of this study and by the level of detail that each plan for each area has
required.

It is timely and very useful to add additional conclusions on specific topics and areas that have been
part of this study and that have led to the achievement of the objectives.

^ A complete analysis of the fish meat industrial sector has been carried out. This has included the
analysis of the situation of the environment, analysis of textures, analysis of Porter's competitive
forces, analysis of profitability and attractiveness of the industrial sector, analysis of segmentation
levels, impact of entry and exit barriers on the profitability of industry and business risk analysis.

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 Based on all the previous information, the following has been established as a conclusion of the
analysis of the industrial sector: “The sector is established by few companies that have a significant
market share and none can influence the evolution of the industry. There are low entry barriers,
absence of economies of scale, high transportation and storage costs and diversity in customer
needs, which is why it is concluded that it is a fragmented industrial sector .

^ The scope of the strategy in which TAMBAQUI must operate has been defined for its institutional
consolidation at all levels. To this end, the Strengths, Opportunities, Weaknesses and Threats have
been identified, the critical success factors have been identified - summarized in the following
paragraph - and both the generic strategy and the growth strategy that is recommended to be
followed have been determined (the latter are detailed in the Recommendations subtitle).

For the development of competitive advantages and institutional consolidation of TAMBAQUI, the
following critical success factors have mainly been identified:

o The Ivirgarzama region has the privileged agro-environmental conditions of tropical growing
areas, such as humidity, stable temperatures, and regular rainfall throughout the year.

o Its strategic location will allow the transportation of fish meat in optimal conditions, and
permanent and timely access to the central axis markets.

o The availability of alternative, supplementary inputs for fish feeding (banana, papaya,
cassava, etc.) will allow a considerable reduction in production costs

o There is a deep-rooted tradition of consuming fish from the tropical Chapare area, this
conditions a brand positioning.

o TAMBAQUI for success in the cultivation of the chosen species is close to suppliers of
fingerlings and food inputs (PIRAIBA – UMSS) and private suppliers of Santa Cruz.

o The suppliers of the raw materials for the collection, processing and marketing
company are the family producers, partners and shareholders of “TAMBAQUI”.

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 ^ In the administrative and organizational aspect, TAMBAQUI have proposed two Vision and Mission
proposals.

^ In the production area, specifically in product design, the need has been identified to develop a mix
of various products and presentations of the primary industrialization process, these are:

^ Whole fish without viscera in bulk

^ Whole fish without viscera on trays
^ Whole fish without viscera vacuum-packed
^ Headless fish without guts HG in bulk
^ Headless fish without guts HG on platter
^ Headless fish without viscera HG vacuum
^ Bulk butterfly cut fish
^ Butterfly cut fish on a platter
^ Vacuum cut butterfly fish
^ Bulk fish fillet
^ Fish fillet on a platter
^ Vacuum-fed fish fillet

^ There is a latent demand in export markets, and it is possible that with the recovery of economic
stability in the region it could obtain unsatisfied market shares.

^ On a financial level, the investments planned for 2005 amount to $35,500, considering the production
volumes that TAMBAQUI will achieve starting that year, considering 50 modules and 100 ponds.

^ The income statement of TAMBAQUI presents a value of $us in the first year. 7,395, which tend to
increase constantly from the second to the fifth year, reaching a value of $us. 17.555.

^ The analysis carried out according to the sales and the investments that are intended to be made
result in a net cash flow with positive values in the five years. The cost-benefit ratio is low, 11 cents
recovered per dollar invested, but taking into account that the processing plant's basic function is to
capture the entire production, it will contribute to the socioeconomic development of the region.

5. RECOMMENDATIONS

^ TAMBAQUI in the future, must take advantage of its strategic position and the nature of the
characteristics of that industrial sector (fragmentation) so that, on the one hand, specialization can
occur, whether by product, by type of client, by type of purchase, by geographic area or by service
area. And on the other hand, try to concentrate the sector to export economies of scale, standardize
the needs of different markets, neutralize or separate the origins of fragmentation.
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 ^ It is proposed, in the scope of the generic strategy, TAMBAQUI adopts a strategic position of broad
differentiation for the national domestic market and offers differentiation attributes, transferring
added value to the product such as reliability, safety, hygiene, etc. (attributes that are valued by the
market segments shown above).

^ It is recommended as a growth strategy that TAMBAQUI adopts, for the domestic market, a “Market
Penetration” strategy. To do this, the company must look for ways to increase the market share of
its recent products in its current markets, investing in global demand, increasing sales, acquiring a
position in the market, defending that market position, reorganizing its undersupplied markets and
improved profitability. In parallel,

recommends adopting a market development strategy, focusing on the opening of international markets
such as Argentina, Peru, Chile and the United States.

^ It is suggested to direct all TAMBAQUI resources towards the fulfillment of the following strategic
and financial objectives:

i) Consolidate the backward vertical integration of TAMBAQUI , for the development of

productive activities.

j) Unify the individual efforts of TAMBAQUI associates, guiding them to achieve joint
objectives.

k) Obtain the best quality and homogeneity of products through the design, implementation and
maintenance of a quality control and assurance system.

l) Increase production volumes and use of THE modules to access a scenario of economies of
scale.

m) Implement and maintain an aggressive and proactive marketing and sales policy in the
national market .

n) Develop capacity to compete in international markets.

o) Implement a human resources training system that, in addition to providing the best
qualifications to personnel, constitutes an additional motivation factor, recipient and manager
of new initiatives .

p) Provide a better quality of life to TAMBAQUI associates.

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 Financial Objectives

h) Access an increase in income in the shortest possible time.

i) Increase profits in the shortest possible time.

j) Obtain the highest contribution margins on each product.

k) Obtain higher dividends for all associates.

l) Achieve greater profitability on invested capital.

m) Establish a more diversified income structure based on the manufacturing of alternative

products and providing technical assistance, training and other services.

n) Increase cash flow and maintain sufficient working capital , at all times.

^ It is suggested to implement this business plan, using all the proposals and recommendations made,
in the proposed Plan module, for each of the areas of the company.

^ It is recommended to opt for initiatives to make the products known to consumers through events
such as fairs, tasting days, as well as information on the different ways of preparation.

^ It is highly recommended to implement a policy for the management and use of waste from the
product process (viscera, bones, etc.), consistent with an environmental management plan, which
allows them to be used as additives for balanced feed.

^ It should be ensured that production and sales volumes increase rapidly by cultivating the
recommended planting densities and increasing the number of ponds, in order to access an
economy of scale scenario.

^ The implementation of more ponds is recommended, either with the support of a cooperation
agency or on its own, since the

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increase in production volumes as an effect of the increase in the number of members or the growth of
existing ones, based on the results of the financial year that were positive per family module, based on
the three thousand meters of cultivated water surface (3 ponds)

^ Monitoring and training is recommended during the implementation period of the company, since it
will be of utmost importance for TAMBAQUI to train personnel who will later be able to direct the
company, leading it to efficient self-management.

^ It is recommended that the quality and presentation of the products that TAMBAQUI launches on the
market must remain homogeneous and meet the requirements specified by the clients at all times.

^ TAMBAQUI must implement a planned and efficient commercial management system.

^ For the opening of markets, two aspects must be highlighted: the origin of the products (fresh
refrigerated farmed fish from the Cochabamba tropics) and the socio-economic benefit it generates
(strategy to support Alternative Development).

^ Support for fish-producing beneficiaries should be aimed at planning sowing and harvesting , as
well as resource management and provision of funds for future purchases of fingerlings and
inputs for subsequent production cycles, this will allow them to achieve sustainable productions and
an adequate capacity for self-management.

^ The financial analysis has given guidelines to recommend the following: The financial structure
proposed for TAMBAQUI shows a lack of liquidity or availability of resources to cover short-term
obligations, for this reason the treasury accounts present negative results. On the other hand, the
shortage of own funds can increase in the future either through capital injection or retention of
profits, converting them into reserves.

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