SMS Spices Pvt Ltd – Model of a

Chili - Pepper farming venture

Muhammad Mudassir
Saba Afzal
Samia Saleem
Vision & Mission

 Our Vision Statement

Our Vision is to become one of the leading chili – pepper cum vegetable farm
brands not just in the Pakistan but also on the global stage.
 Our Mission Statement
Our mission statement as a commercial farm is to go into full – time cultivation of
chili – peppers and other vegetables that will not only be consumed in Pakistan, but
also exported to other parts of the world.
Reasons for Selection of Product
 Industry Overview
 Chili farming has evolved from small scale garden farming into a global industry in most
countries where it is carried out, because chili-pepper is used for stew, soup and a wide variety
of meals and it is consumed all over the world.
 In many cultures and areas of the world, chili & pepper is traditionally used in edibles.
 Chili has global demand. Historically, Asia, Latin America & Africa have been major
producers/consumers of chili & pepper.
 However, demand has been increasing in North America, Europe & Oceania

 Trade statistics of the product

 Total production : 31.13m tonnes
 World Trade : US$ 602,343,000
Reasons for Selection of Product (Contd)
 Pakistan is sixth largest Chili producing country in the world. Pakistan has a potential to export 90, 000 tonnes /
year
 Expected Foreign exchange: US$ 47m/ year
 Sindh produces around 88% of chili in Pakistan. Red dandicut chili in lower Sindh area is known as biggest chili
market of Asia.
 It is cultivated at an area of 40,000 hectares.
 Number of initiatives are being taken by various organizations to improve quality.
 Agribusiness Support Fund - a project of USAID funded construction of 588 solar driers in Kunri.
 Reduction in drying time from 8-10 days to 4-5 days.
 20% increase in income
 Dehydration plants - 30 tonnes/day
 As Sindh is the centre for chilli production, it will reduce transportation cost due to proximity of Port.
 Target Market:
 USA
 UK
 Netherlands
 Germany
 Japan
 Malaysia
 Middle East
SWOT Analysis
SWOT Analysis of our project yields below mentioned findings:
Strengths
 Our strength as a chili – pepper farm company is the fact
that we have healthy relationships with loads of major
players (agriculture merchants) in the agriculture
industry; both suppliers and buyers within and outside
of the Country.
 We have some of the latest chili – pepper cum vegetable
farming machines, tools and equipment that will help us
cultivate crops in commercial quantities.
Opportunities
 The opportunities that are available to us cannot be
quantified, we know that everybody on planet earth
eat chili – peppers and other types of vegetables.
 We are also ready to take advantage of any
opportunity that is available in the chili farming
industry.
Weakness
 Our weakness could be that we are a new chili farming
industry in the country, it might take some time for our
organization to break into the market and gain
acceptance especially from international markets in the
already saturated and highly competitive commercial
farming industry.
 Another weakness is that we may not have the required
cash to promote our business the way we would want
to.
Threats
 Both the number of small local farms and the number of
larger commercial farms have been growing. Increasing
imports of fresh produce will slightly constrain demand
for chili – peppers and other vegetables.
 The arrival of a new chili farm or commercial
greenhouse farm in the same location where our target
market exists and who may want to adopt the same
business model like us
Name of the company with address etc
 SMS Spices Pvt Limited
 194, Ahmad Plaza, Clifton, Karachi
 Telephone : (021) 8745599
 Website : www.sms-spices.com.pk
 For queries & information : info@sms-spices.com.pk
 For placing orders : orders@sms-spices.com.pk
Type of company and registration procedure
 The company will be “private limited” having three share-holders.
 The company will not be listed.
 Name of company has already been decided and confirmed.
 Office is already operational with three shareholders and six staff members.
 Chief Operating Officer
 General Farm Manager
 Administrator/Accountant
 Crop (Chili – pepper and other Vegetables) Cultivation Manager/Supervisor
 Sales and Marketing Executive
 Front Desk Officer
 Office equipment, Furniture, Electricity, Telephone, Website and e-mail addresses have been
procured.
 A bank account has also been opened in company’s name.
 Partnership deed has been signed and stamped.
 Below mentioned essential processes are underway:
 NTN Acquisition
 Membership from Karachi Chamber of Commerce & Industry
 Registration with SECP
Type of company and registration procedure (Contd)

 Below mentioned tasks are in pipeline and included in Business plan of the
company:
 Start–up Capital generation
 Purchase of All forms of Insurance for the Business
 Drafting of Employee’s Handbook
 Purchase of the needed farming tools, machines and equipment
 Leasing of farm land in Sindh (preparing the farm land inclusive)
 Farm land Treatment, Health and Safety Arrangement
 Graphic Designs and Printing of Packaging, Marketing/Promotional Materials
 Creating Awareness for the business (Business PR)
 Establishing business relationship with key players in the industry (agriculture farm
produce merchants, food hub, transporters and suppliers of seeds, fertilizers, pesticides
and insecticides)
Sales, Marketing & Pricing Strategy
 Sales & Marketing Strategy
 Introduce our farming business by sending introductory letters alongside our
brochure to stakeholders in the agriculture industry, companies that rely on the
agriculture industry for their raw materials, food hubs, supermarkets, grocery
stores, hotels and restaurants and agriculture produce merchants et al
 Advertise our business and agriculture produce in agro – allied and food related
magazines and websites
 List our chili – peppers cum vegetable farms on yellow pages ads
 Attend related agriculture and food expos, seminars and business fairs et al
 Leverage on the internet to promote our business
 Engage in direct marketing
 Encourage the use of word of mouth marketing (referrals)
 Pricing Strategy
 We are quite aware that one of the easiest means of penetrating the market and
acquiring loads of customers for our chili – peppers is to sell them at competitive
prices hence we will do all we can to ensure that the prices of our farm produces
are going to be what other commercial farmers would look towards beating.
Financial Projections and Costing
Below are some of the basic areas we will spend our start – up capital in setting up our
chili farm;
 The total fee for incorporating the business– $750
 The total cost for payment of insurance policy covers (general liability, workers’
compensation and property casualty) coverage at a total premium – $9,400
 The amount needed to acquire/lease a farm land – $50,000
 The amount required for preparing the farm land – $70,000
 The cost for acquiring the required working tools and equipment/machines/fencing et
al – $10,000
 The amount required for the purchase of the first set of chili – peppers and other
vegetable seedlings et al – $50,000
 Operational cost for the first 3 months (salaries of employees, payments of bills et al)
– $40,000
 The cost of launching an official website – $600
 The amount required for payment of workers for a period of 3 months – $100,000
 Additional Expenditure (Business cards, Signage, Adverts and Promotions et al) –
$2,000
 Going by the report from detailed research and feasibility studies conducted, we will
need an average of $500,000 to start a standard chili farming setup.
Identify the main HS Code of the product
and their subheads
 Product: 09 Coffee, tea, maté and spices
 Product: 0904 Pepper of the genus Piper; dried or crushed or ground fruits of the genus Capsicum or of
the genus Pimenta
 Product: 090421 Fruits of the genus Capsicum or of the genus Pimenta, dried, neither crushed nor
ground
 Product: 09042110 Fruits of the genus Capsicum or of the genus Pimenta, dried, neither crushed nor
ground: dried, neither crushed nor ground: red chillies (whole)
 Total exports of the subject product from Pakistan in the last
5 years
Pakistan's exports to World
Product code Product label
2009 2010 2011 2012 2013 2014 2015 2016
Fruits of the genus Capsicum or of the genus Pimenta, dried,
9042110 neither crushed nor ground: dried, neither crushed nor ground: 0 0 0 4969 6339 3970 5907 7163
red chillies (whole)

HS: 9042110

7163

6339
5907

4969

3970

0 0 0 0
2009 2010 2011 2012 2013 2014 2015 2016
THANKYOU