1

LETTER OF TRANSMITTAL

August 1, 2015 Md. Bokhtiar Hasan Course Instructor, Department of Finance and Banking. Islamic University, Kushtia.

Subject: Submission of Business plan on “Poultry Farm”.

Dear Sir,

With due respect, we would like to inform you that, we have already made a business plan. It is a great pleasure for us to have the opportunity to submit the business plan on “Entrepreneurship Development” of BBA program. During the preparation of this plan, we have tried to give our best efforts to make it a comprehensive one. From different analysis we came to know much information related to our selected topic.

We shall be highly glad if you kindly receive this report and provide your valuable judgment. We would like to place for your evaluation & recommendation.

Sincerely Yours,

Group- D

2

Name of group membersRoll No Name1021031 MD Khairul Alam1021032 Khondakar Habibur1021033 Md. Monirul Isalm1021034 Belayet Hossen1021035 Jamil Hossain1021036 Shimul Sardar1021037 Abu Sayed1021038 Md.Shariful Islam1021039 SM Nahidul Islam1021040 Md. Touhidul Islam

3

Preface

Now a day without a proper business plan a business cannot be run successfully. But in Bangladesh most of the cases business man does not do that. We are happy to publish a business plan. As it is our first experience but we have tried to do something comprehensive for the society. However to start up a new business is researchable, costly and timely matter which has not adjustable.

But with a single time and assess on some research we have to publish business plan. Its name is “Poultry Firm”. Although this types of business familiar to our country but they are not organizely operated. However we hope this business plan will give a good response to entrepreneurs who want to do this successfully. Thanks Allah for completing this plan.

SM Nahidul Islam on behalf of the group - D

Table of Contents

4

Title Page No.

Introduction 6-7Origin of the report 6 Background of the report 6Objective of the report 6Sources of data collection 7Executive summery 8Project selection 9-11Macro screening 9Micro screening 10Starting state 11Background 12-13Poultry farm objectives 12Location and premises 12Contact information 12Business strategy and mission 12Realities and prospectus of poultry farm 13 Challenges facing the poultry industry 13

Product and services 14Product description 14Service description 14Research and development work 14Production summery 15Production plan 15Production costs 15Production systems 15Market analysis summery 16-19Market segmentation 16Target market segment strategy 16Extension of market 17Competition 17

5

Business competitive edge 17Market strategy 18Web strategy 19Sales strategy 19Human resources 20-21Management team background 20Duties and responsibilities of management team 20Payment of salaries and benefits to the management team

21

Personnel 21Financial planning 23-25Estimated amount and sources of funds 23Loan repayment schedule 23Poultry farm start up costs 23Projected income statement 24Cash flow analysis 25

6

INTRODUCTION

Origin of the report: The report titled “Poultry Farm”, oriented from the partial fulfillment of the course Entrepreneurship Development conducted by Group-D, to have a practical knowledge about the real world and how the business today forms and how to prepare an attractive business plan.

Background of the report:

Poultry farm is very familiar business now a days and it is very hard to create a different identity for a new poultry farm is a formidable task. Now there are so many poultry farms in the industry but to create its own reputation (goodwill), will be very difficult. Here in this report we are trying to show how to prepare a good business plan which can be worked as a guideline and can help to acquire financing in this competitive market. As we well know to become a successful company in this competitive market one has to have very good marketing strategies to satisfy their customers and to sustain in the business.

Objective of the report:

Primary objective of the report is to meet the requirement of the course “Entrepreneurship Development”. Our secondary objectives are as follows:

To identify the current market situation and previous trend in this sector. To know about the ingredients that will make a business plan attractive. To compare the business plan with the real world possibilities. To provide an example of good business plan.

7

Sources and methods of data collection:

The data collection method of this study was consisted of both secondary and primary sources.

Data sources:

a) Primary data: Personal interview technique was the primary tool used for collecting information. The primary data also included interviews with some poultry farm owners to understand the ins and outs of a poultry farm.

b) Secondary data: We have collected our secondary data from Bangladesh Bureau of statistics, website and also from third parties (newspaper, journals, etc) reviews.

The scope of the report: This report deals with the factors related to make the report a realistic one which can be used for acquiring finance and can guide the business for its future activities. It can also be effective for making the venture a profitable one and will provide a higher rate of return. The scope of the report is very clear. It will only used for creating a successful project.

8

EXECUTIVE SUMMARY

This report is consisting a plan of poultry farm begins with the project selection process describing how the idea of the project actually came to the concern of the entrepreneurs. This process includes macro screening of five different projects and rating of those projects different macro variables are used for those purpose. After that micro screenings has been done by narrow down the number of two most likely projects and again rating them.

After the introductory page, the next part of the plan is background. This part consists of the overall focuses on the entire report, i.e. what have we done step by step for business plan.

After the background, the next step is product & services. The main activities have been started front this stage. Here we have described the main product and services of our business what we want to produce.

The next part is the production summery where the brief description of the entire production plant depicts. Here, the production plan has been described clearly. Moreover, a layout of the production plant has shown there.

After then, the next part is market analysis summary. This part consists about our product market, its sizes and where we are going to do business. It also describes about competitors. Here, marketing strategy has also been described. It also involves the marketing plan that involves the overall marketing mix advertisement and the mode of advertisement.

In the organizational plan part, the organizational structure of the business is included. The number of partners, their respective responsibilities in the management of the firm is also stated here. The background of the partners is also included in this part.

The next part is the internal environmental analysis where SWOT (stands for strength, weakness, opportunities and threats) has been analyzed. Then in the external environmental analysis part socio-cultural, Technological, Economic and Political factors has been analyzed.

At last the financial plan part, different financial statements (projected) are added. These statements will help to identify the financing needed for the business total production, total sales and cash flows statement for the project. There is — a pan of consisting the source of capital; and the application of capital. Since there is debt financing so a repayment schedule is included. Income statement will help to find out the solvency and profitability of business.

9

PROJECT SELECTION

Evaluation of Project Ideas

Macro screening

Initially three project ideas was evaluated by the entrepreneurs based on some majors macro criteria such as population, economic etc macro variable and the result was as follows summarized

Macro variable

Project name

Population Techno-logy

Polit-ical

Social and cultural

Legal Natural Econo-mic

Total

Rank

farm 4 3 4 3 3 3 3 23 3rd

PoultryFarm

5 5 5 5 5 4 4 33 1st

Fast Food

4 4 3 3 4 4 3 25 2nd

After evaluation it was found that the macro variables were most favorable to the poultry farm project.

o Weights 5 = Excellent 4 = Very much satisfactory 3 = Satisfactory 2 = Good 1 = Unsatisfactory

10

MICRO SCREENING

After macro screening of the above three projects the entrepreneurs narrow down the options between two projects which are:

Project Name

Market Demand

Availa-bilityof Rawmaterials

Availa-bilityof Skilled worker

Techn-ology

Availa-bilityof Capital

Pro-fita-bility

Risk Total Rank

Farm 4 4 4 4 4 4 4 28 2nd

PoultryFarm

5 5 5 5 5 5 5 35 1st

Weights

Good = 4 Better = 5

Profiability

Bellow 15%= 4 Above 15%= 5

Risk

Above 10%= 4 Bellow 10%=5

11

STARTING STATE

Selecting best alternative business plan:

Finally the process of formation of the business plan is begun in the stage. This part is basically important because we need stated objective determine goals here. It is hard to start is any work. Many suitable decisions are taking in this stage. such as location, types of business ownership etc. which are important factor?

At last we are able to select one firm, the alternative business plan. The selected business plan proposed name is “Poultry Farm” in this chapter we have described the reason of selecting the business.

12

BACKGROUND

The name of our venture is XYZ poultry farm. It is a partnership firm and the numbers of partners are five.

Poultry farm Objectives

XYZ poultry will measure its success by its ability to achieve the following objectives: Becoming the "Best and most hygienic poultry producer in the area" complying by

the national standards for food and drugs. Turn in profits from the first six months of operations. Maintain 50% gross margin ratio. Winning the hearts and tastes of our beloved consumers and establishing a brand

image of the company through heavy marketing campaigns in the first one year.

Location and premises

The farm is situated at the Sheikhpara near the Islamic University, Kushtia. The location is very suitable as most of the materials are available here and product can be distributed very easily. We think the population base is large enough for our business and it has a stable economic base that promotes a healthy environment for the poultry. Also we think it is a spot that could tap a healthy workforce. We also considered pedestrian traffic and we think a large percentage of them are potential customers. We plan on having a good parking space and sufficient security in our working site to create a safe environment for the customers.

Contact Information

We can be contacted through our email address, xyzpoultry@yahoo.com. We also have a website hosted by Google at https://sites.google.com/a/aun.edu.ng/www-xyzpoultry-com/blog/homewhere we can reach our customers and see their complaints, feedback and recommendations. The website will also be a forum for customers to familiarize themselves with the poultry. All these and the phone numbers of the management team will be distributed in flyers and in the means we market our business as our contact information.

Business strategy and Mission:

The new strategy is to cover most of the locality of Kushtia and Jhenaidah city by providing better services.

13

The mission is to provide customers with quality, fresh, and valuable products at a reasonable price.

Realities and prospectus of poultry farm

The poultry industry has developed in Bangladesh. The poultry sector is playing a vital role in reduction of poverty, malnutrition and unemployment problems of the country. In just about two decades, the industry has been exponential growth. It was in 1995 that the poultry industry started in an organised manner in Bangladesh. Investment in the sector stands at about Taka 200 billion. Its growth rate is about 20 per cent. About five million people are involved, directly and indirectly, with the industry, and approximately 50 per cent of them are women. A large section of the marginalised rural people earns their living through this industry. Of the 18.6 per cent of the GDP, which comes from the agricultural sector, one-third is from the poultry industry. Credit certainly goes to the private sector entrepreneurs in this sector.

Challenges facing the poultry industry: Poultry farming has some challenges that need to be attended to with vigor. Below are some of the common challenges that are faced by poultry farmers:

Death of chickens: In poultry, one or many chickens usually die because of their fragile nature and the weather they are living in. Some factors such as heat and overcrowding causing that death can be controllable.

Diseases: Pneumonia and other minor diseases are among problems faced by poultry farmers, but this problem can be solved by seeking a veterinary doctor.

14

PRODUCTS AND SERVICES

Product description

We offer chicken eggs and chicken meat that will be gotten from layers and broilers to our target market. We plan to take pride in the uncompromising quality of our products. We also offer fertilizer in form of chicken manure. This is mostly used in vegetable farming and as an ingredient for feed in fish farming. XYZ poultry shall produce high quality, contaminant-free chickens and the freshest eggs to satisfy the taste of our beloved costumers. In brief our products are;

Main productsa) Eggsb) Live chickens

By-productsa) Chicken droppings

Service Description

We plan on servicing our customers by providing home delivery for customers who are willing to buy at least a certain amount of our products.

Research and development work:In preparing the business plan, it is important to consider need of the external sources and not merely provide their own perspectives. This will keep the plan from being an internalized document that emphasizes only the technical advantages of a product or market advantages of a service, without consideration of the feasibility of meeting market goals and long term financial projection. So for our project collecting information, we have completed various research and development works that are as fallow:

Firstly, we investigated the existing farm’s overall history, existing products or services background of the founders or management team and any information that might create favorable image.

Secondly, we investigated the present competitor’s position to gain more knowledge about strategy in the marketplace such as the process of distribution and advertisement.

15

And finally, we also investigated the potential customers through the asking specific question on their needs, competitive products potential interest in the new venture’s products and services.

PRODUCTION SUMMARY

Production plan:

In our poultry, we are planning to keep 5,000 chickens for meat, and 5000 chickens for eggs. For 5000 chickens for eggs, each chicken is expected to lay at least 1 egg per day. For every 3 months, adult 2500 chickens will be sold. Our production target is to reduce cost of production by at least 20% in the next 3 years.

Production costs:

Our fixed costs include Insurance payments covering both general liability and product liability, Area of about one plot will be allocated for the farm; A house will be rented for the storage of pellets; Materials for office and store furniture, shelving, a computer, phone system, and

tools. Long-term assets including the refrigerator unit for the shop, window displays and a

refrigerated delivery van. Raw materials used include

Broilers Layers Water, Feed

Production systems:

There are many production systems in Bangladesh. But we will follow the Battery Cage System in which hens are kept throughout their productive life time in cages. However, this system requires high capital investment. In this system, hens do not have contact with droppings which reduces infections. Feeding, providing water, egg collection, removal of litter and cleaning are easier for the poultry attendants to perform.

16

MARKET ANALYSIS SUMMARY

Market segmentation:

Although in the Bangladesh populace, there are a few taboos, religious or cultural practices that will prevent the consumption of poultry produce, during the market segmentation, we found out that nearly everybody eats eggs and meat, so we are targeting the whole market, individuals, homes and firms that use eggs and chicken in large quantities. Specifically there is a high demand for live chickens for home consumption or as gifts during festivals like Eid-al-Fitr, Christmas, New Year, Easter etc.

Market Segmentation

Hotels and restaurantsBakeries and food jointsRetail shopsHomesIndividualsOthers

Target market segment strategy:

17

Individuals are a small sector in the market segmentation. They are a pretty large group but they buy a relatively small amount of eggs.

The part of the market that we hope to supply large amount of eggs are the industries that need eggs. We have strategically placed our site close to these industries. They are bakeries, restaurants, boarding schools, home delivery food centers, and retail shops.

Another part of our target market that will order our products in medium quantities are the homes that will require our home delivery as we have a set amount of eggs they need to order for. Homes generally utilize eggs in the preparation of edibles like chicken burger, chicken pie, salads, Scotch egg, omelets, egg soup etc.

The parts of our target market interested in live chickens are small scale poultry farmers and festive individuals. We have considered the needs of each section of the target markets and we plan on meeting these needs effectively.

Extension of Market:

The poultry product enjoys the extensive market all over the world. Poultry products (broiler meat in particular) have the highest per capita consumption in the world. People eat many different poultry products, including eggs, turkey ham, Buffalo wings, hot dogs, chicken nuggets, chicken-patties, fried, roasted, glazed, marinated, etc. Not all of poultry products, however, are directly consumed by humans. For example, eggs are also used for the production of therapeutic vaccines and are beginning to be used for production of antibodies and pharmacological proteins. Part of the increase in poultry production in the 1980s and 1990s can be attributed to the development of new, further-processed, value-added products. Similarly, the egg market has changed in scope through the late 1980s such that a greater proportion of eggs that are produced are destined for a liquid egg market. Liquid egg is used in a variety of institutions including hotels, restaurants, hospitals, and if dried, included in numerous other products, such as cake mixes.

Competition

Competition is not so keen in the markets, however it still exists. The reasons are;

Poultry products are not branded products; hence what usually matters is effective positioning and timing.

Poultry market is not crowded; it’s a seller’s market. Most poultry produce are sold through informal channels. Competition is usually

found within local products and imported ones.

Business competitive edge

18

Our strength over its competitors is firstly based on the fact that we are not entering this business to make much money. We are entering this industry to solve the present problem that our population is facing. We are here to provide quality affordable chicken products. We saw that some of our competitors are seasonal they only produce their chicken at a given period of time. We won’t work like that always is ready to provide chicken and eggs. We know the importance of time and know that people have many and varying activities; knowing all that we will be delivering our products to the customer’s door. Through our motto “customer is the king” we will have an ever fast delivery. The other factor that will help us to have success over our competitors is to motivate our employees and helping them to improve their way of living, this will help our employees to be focused on their work and provider better services to their customers. We expected our business to grow and start working at national level and this will be achieved through hardworking of management team and efficiency and effective use of materials and time is the key to be successful over our competitors.

Marketing strategy

XYZ poultry will strive for the production of products with the highest quality and we plan on employing the following strategies. Our location puts us in proximity of a major hotel, restaurant, schools with campuses and home deliver food centers we will be supplying to. We would also make contracts with hawkers in markets to sell our live chickens and eggs. We would also make contracts with retail shops for constant supply of eggs at intervals.

Focusing on associated following issue:

Packaging: In case of packaging the egg the farm use well equipped mechanism which helps the product to maintain its quality and getting the confidence of the consumer.

Pricing: It is very formidable task to select the price of the egg because if the farm fixes the price without concerning the demand and supply situation of the market the farm may have to lose the market. The farm selects the price by considering the following factors:

Quality of the egg. Conducting the marketing research and try to determine a reasonable price that the

consumers are willing to pay. Knowledge of competitor’s price.

Policy:

The farm is giving some discounts and allowances for quick payment. There is also some credit terms are fixed with retailers. Payments period.

19

Distribution: The management of the farm evaluates all possible options for distribution before making a decision in the marketing plan. Marketing research as well as networking among associated business farms, friends and consumer helps the farm to select the right distribution channel.

Factors such as:

a. Type of channel.b. Member of intermediaries.c. Cost.d. Location of channel members.e. Area of coverage.f. Transportation.

Are also take into account before making the decision by the farm. The farm is using both whole seller and retailer in their distribution.Whole seller is used to deliver the egg to the institutional customer and for market and retailers is used for the distribution of egg to home of local area. The poultry farm also has two vans to provide the egg in different stores.

Promotion: Like the other venture this poultry farm also takes the necessary steps to inform. The farm is considering the following factors before going into the promotion of the product:Evaluate each of the media alternatives

a. Considering the cost associated.b. Effectiveness of the medium.c. Media interest in publicity.

The poultry farm generally use leaflet in local area as a media. And it also uses newspaper to the promotion of the farm and the product. Sometimes the farm also uses Radio as a media to introduce the farm.

Web strategy

XYZ poultry also has a website where customers can interact with us and get a feel of what the business is about. We know a site or two where we can place online advertisements and we would also make mentions of our poultry in online newspapers.

Sales strategy

Better farm management practices Regular visit by veterinary doctors Recycling wastes as fertilizer “consumer is king” policy Keeping up with new technology for production efficiency

20

HUMAN RESOURCES

Management Team Background:

The management team of the partnership business will consist of six individuals. Five of the six are active partners of the farm and the remaining one person is an experienced one in this sector.

Name and background of each of the management team individual is given below:

Belayet Hossen (partner): Born and raised in Narail. Currently graduating from the Islamic University, Kushtia major in finance & banking. No background relative to this sector.

SM Nahidul Islam (partner): Born and raised in Khulna. Currently graduating from the Islamic University, Kushtia major in finance & banking. No background relative to this sector.

Md. Touhidul Islam (partner): Born and raised in Bogra. Currently graduating from the Islamic University, Kushtia major in finance & banking. No background relative to this sector.

Shimul Sardar(partner): Born and raised in Bagerhat. Currently graduating from the Islamic University, Kushtia major in finance & banking. No background relative to this sector.

Abu Sayed (partner): Born and raised in Meher Pur. Currently graduating from the Islamic University, Kushtia major in finance & banking. No background relative to this sector.

Khairul Alam (Non-partner): Born and raised in Kushtia. Passed HSC in the year 2009 from Kushtia Govt. College. He has an experience to work in a poultry farm for last 3 years successfully.

Duties and Responsibilities of the Management Team:

21

Belayet Hossen:

Designation-General Administrator Manager.

He will take care of the daily business operations. Includes hiring new employees as well as providing training and supervising. Periodic employee performance evaluation will also be performed by him.

Md. Touhidul Islam:

Designation- Sales Marketing and Promotion Manager.

Responsible for creating marketing and promotional activities, monitoring daily sales. He will be responsible for the design and distribution of all direct marketing materials.

Shimul Sardar:

Designation- Distribution and Research & Development Manager.

Responsible for maintaining the regular distribution network. Performs all the research & development activities related to the business. Find any trend in the economy; forecast the future demand, any change in demand, and entry of any new potential competitor.

SM Nahidul Islam:

Designation- Financial Manager.

He will be responsible for keeping records of all daily transactions. He will handle all the financial dealings. Another partner having the check signing authority on behalf of the business. Handles all the purchase and sales of assets. Responsible for payroll, billing and other legal matters.

Khairul Alam:

Responsible for all the chicks related matters. Such as knowledge about daily production, maintaining healthy environment in the farm, taking care of the chicks, keep them safe from diseases.

Payment of salaries and Benefit to the Management Team:

According to the partnership contract the partners will not get any kind of salaries or bonuses for performing their respective responsibilities. Partners will only share profit or loss at the end of a financial year after the auditing has been performed. But in case of the last member in the management Khairul Alam the treatment will be different. Since he is a non-partner and will not share any profit and loss so he will get monthly salary of Tk.8000 per month.

Personnel

22

Apart from the management team, other personnel include

1. Cleaners2. Security3. Technician4. food technician5. Veterinary doctor6. Driver

There are 5 cleaners, 2 security, 1 technician, 2 food technicians and a veterinary doctor. There is also a driver to make the delivery services. Except from the veterinary doctor, the personnel are on a monthly payroll and are all in a short time contract with the poultry.

INTERNAL ENVIRONMENTAL ANALYSIS

SWOT analysis:

SWOT stands for strength, weakness, opportunities and threats and we have made an analysis in each case.

Strength

Produce high quality eggs enriched with protein Relatively good infrastructure systems Good marketing system Eggs and chicken are not seasonal products and can be eaten any time of the year In this area, the poultry business hasn’t been over-exploited Poultry are environmentally friendly

Weakness

Capital intensive. Starting a poultry business requires a large capital funding. Outbreak of disease can ruin entire business in a go The smell can be quite disturbing

Opportunities

Expansion into large scale production of byproducts(fertilizer and detergent) Export to neighboring towns A large and successful poultry will ensure food security

Threats

More competition Avian diseases High feed ingredients prices

23

Threat of import of frozen chicken

EXTERNAL ENVIRONMENTAL ANALYSIS

Socio-cultural – Eating habits of our consumers will definitely affect our business. Also, the success of restaurants and other firms that order our products will indirectly affect our business.Technological - A good technical infrastructure would lead to better production and hence lower costs. Technology will also mean more effective business marketing.Economic – economic trends such as demand and supply will determine the sustenance and profitability of the business. Also inflation rates will affect the way we pay our employees and the price of the product.Political – this will include government policies concerning inspection by the ministry of health and organizations.

FINANCIAL PLANNING

Estimated amount and sources of funds

Equity financing 1000000 (partners capital)Debt financing 1000000 (long term debt)Total financing = 2000000

Loan repayment schedule

Year Amount of loan

Principal payment

Rate of interest

Interest payment

Total payment

1st 1000000 200000 10% 100000 3000002nd 800000 200000 10% 80000 2800003rd 600000 200000 10% 60000 2600004th 400000 200000 10% 40000 2400005th 200000 200000 10% 20000 220000

Poultry farm start up costs

Items CostsLand 300000Building 200000Advertising / marketing 18000Equipments (Feeders and drinkers, Crates, Egg tray, Cages, Refrigerator)

200000

Computers 100000Insurance 50000Electricity, water supply and sewerage installation and system development

20000

24

Pre-production cost (Registration of partnership deed) 2000Food stuff godown 10000Day old chicken purchase ( 5000 chicks × tk 80) 400000Laying eggs chicken purchase (5000 chicks × tk 80) 400000Farm house 100000Other outlays 50000Total initial outlay = 1850000

Projected Income statement

Poultry Farm Project

Income: 1st year 2nd year 3rd year 4th year 5th year1. Live chicken

Sales20000 kg × tk 120

20000 kg × tk 120

22000 kg × tk 125

23000 kg × tk 125

25000 kg × tk 130

2400000 2400000 2750000 2875000 32500002. Eggs sales 150000 eggs

× tk 6150000 eggs × tk 6

160000 eggs × tk 6

170000 eggs × tk 6

180000 eggs × tk 6

900000 900000 960000 1020000 10800003. Fertilizers 80000 80000 85000 90000 950004. Total income

(1+2+3) = 3380000 3380000 3795000 3985000 4425000Expenses:5. Day old

chicken purchase

(5000 chicks × tk 80)

(5000 chicks × tk 80)

(5000 chicks × tk 80)

(6000 chicks × tk 80)

(6000 chicks × tk 80)

400000 400000 400000 480000 4800006. Laying eggs

chicken purchase

(5000 chicks × tk 80)

(5000 chicks × tk 80)

(6000 chicks × tk 80)

(6000 chicks × tk 80)

(6500 chicks × tk 80)

400000 400000 480000 480000 5200007. Feed 800000 800000 875000 895000 9500008. Insurance 100000 100000 100000 100000 1000009. Internet 20000 20000 20000 20000 2000010. Labor 192000 192000 192000 192000 19200011. Advertisement 18000 18000 18000 18000 1800012. Depreciation 185000 185000 185000 185000 18500013. Other

expenses 50000 50000 50000 50000 5000014. Total 2165000 2165000 2320000 2420000 2515000

25

expenses = 15. Net income

before interest and taxes (4-14)= 1215000 1215000 1475000 1565000 1910000

16. Interest = 100000 80000 60000 40000 2000017. Net income

before taxes (15-16)= 1115000 1135000 1415000 1525000 1890000

18. Taxes (40%) 446000 454000 566000 610000 75600019. Net income

(17-18) = 669000 681000 849000 915000 1134000

Cash flow analysis

Poultry Farm Project

Items Year-0 Year -1 Year -2 Year -3 Year -4 Year -51. Net income 669000 681000 849000 915000 11340002. Depreciation 185000 185000 185000 185000 1850003. Operating cash

flow(1+2) 854000 866000 1034000 1100000 13190004. Salvage value

(after tax)1200000

5. Initial investment

(1850000)

6. Net working capital

(150000)

7. Total I.I. (5+6) (2000000)8. Total cash flow (2000000) 854000 866000 1034000 1100000 2519000

Pay Back Period (PBP) = 2.27 (approx.) Net Present Value @ 15% (NPV) = 1958703 Internal Rate of Return (IRR) = 44.52 % (approx.)

Additional consideration:

Initial requirement of working capital = Tk. 150000 The depreciation rate is 10% for the project After 5 year the project will be sold at tk. 2000000

26

Conclusion

Some times reports used only to acquire financing from the financial institutions and having no particular use. But this report is prepared from the viewpoint of reality and will use for creating and maintaining a real poultry farm. So this plan has a real good prospect in its real life application.

Appendix:

United Nations Conference on Trade and Development. United Nations, New York and Geneva, 2003.

www.researchgate.net/...Poultry_Business_Plan http://www.entrepreneur.com/businessplan/index.html http://www.entrepreneur.com/article/247574