F.A.M. INHARRIME S J · 2017-10-24 · business plan – pineapple plantation f.a.m. inharrime rjr services mozambique 20 july 2017

BUSINESS PLAN – PINEAPPLE PLANTATION F.A.M. INHARRIME RJR SERVICES MOZAMBIQUE 20 JULY 2017

Business Plan – Pineapple Plantation www.telford.phcportal.com/od/Plantation

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TABLE OF CONTENTS

Executive Summary .................................................................................................................................... 2 1.1. People ........................................................................................................................................................................ 2 1.2. Premises and Equipment ........................................................................................................................................... 2 1.3. Products and Service ................................................................................................................................................. 2 1.4. Marketing .................................................................................................................................................................. 2 1.5. Finance ...................................................................................................................................................................... 2

2. Company Description ...................................................................................................................... 3 2.1. Company Registration ............................................................................................................................................... 3 2.2. Company Objective ................................................................................................................................................... 3 2.3. Company Background ............................................................................................................................................... 3

3. Opportunity, Industry and Market ................................................................................................... 4 3.1. Project Objectives ..................................................................................................................................................... 5 3.2. Benefits and Beneficiaries. ........................................................................................................................................ 5 3.3. Why Pineapples ......................................................................................................................................................... 6 3.4. The Market for Pineapples ........................................................................................................................................ 6

4. Business Strategy ............................................................................................................................. 7 4.1. Overall Business Strategy ......................................................................................................................................... 7 4.2. How we generate revenue ......................................................................................................................................... 8 4.3. Key Milestones ......................................................................................................................................................... 8 4.4. Barriers to Market Entry ........................................................................................................................................... 9

5. Management and Operations Summary ........................................................................................... 9 5.1. Key People ................................................................................................................................................................ 9 5.2. Our Collective Experience ........................................................................................................................................ 9 5.3. The Plantation Process and Accommodation Layout .............................................................................................. 10 5.4. Production Process .................................................................................................................................................. 10 5.5. Producing Soya Beans............................................................................................................................................. 11 5.6. Producing Pineapples .............................................................................................................................................. 11 5.7. Making Juice Products ............................................................................................................................................ 12 5.8. Getting Product to Market. ...................................................................................................................................... 12 5.9. Protection Against Disease and Pests .................................................................................................................... 12

6. Marketing Plan ............................................................................................................................... 12 6.1. Finding Customers .................................................................................................................................................. 12 6.2. Understanding Competitors .................................................................................................................................... 13 6.3. Production Capacity ................................................................................................................................................ 13 6.4. Go to Market Strategy ............................................................................................................................................. 14

7. Financial Plan................................................................................................................................. 14 7.1. Unit Costs for Cultivation and Juicing .................................................................................................................... 14 7.2. Set-Up and Running Costs ...................................................................................................................................... 15 7.3. Money Flow ............................................................................................................................................................ 15

8. Appendices ..................................................................................................................................... 18 8.1. Appendix 1 – Expenses for 12 months’ Time-Line ................................................................................................ 18 8.2. Appendix 2 – First Year Money Flow..................................................................................................................... 19 8.3. Appendix 3 – Second Year Money Flow ................................................................................................................ 20 8.4. Appendix 4 – Planting Strategy .............................................................................................................................. 21 8.5. Appendix 5 – Financial Modelling Spreadsheet ..................................................................................................... 22 8.6. Appendix 6 – Financial (Quantrix) Model .............................................................................................................. 23 8.7. Appendix 7 – The Plantation Project Presentation .................................................................................................. 24 8.8. Appendix 8 – Certificates and Documents .............................................................................................................. 24


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EXECUTIVE SUMMARY This project would not have started were it not for the persistence of a community of women farmers in Mozambique, all of them living well below acceptable levels of subsistence. All of them being well aware of the potential to better their situation but unable to do so without the help of forces outside their community to consult on finance, marketing and production.

The Objectives of the project are therefore mixed between solving the local humanitarian problems and the successful economics of building a working plantation.

1.1. People

The project's founder is James Smit, who gathered a selection of other local foreigners into a team ideal for building plantations after being approached by the Marginalized African Women Farmers (F.A.M.)

Three months into the basic research on crop choice, soil sampling, materials requirements, David Winter joined the team as Project Manager, bringing with him a 'corruption busting' project control methodology that is ideally suited to the cooperative business model.

The main stakeholder in the venture is the body of women that the project is serving with their achievement of commercial independence, addressing of gender inequality issues and education both generally and farming in particular.

A major stakeholder is the network of investors, donors and NGO organisations that by starting this off in July 2017 will make possible not only this project but an expanding wave of others propagated by the Woman farmers themselves. Investment in this project is lighting the touch paper for a bright future for the marginalized women of Mozambique and Africa. The success of this project will be the trigger for launching many others from within the ranks of a newly educated, newly emancipated population of women farmers.

The management team comprises 5 Ex-Pat industry professionals and 300 farmers who are organised into working groups with 500 hectares of land divided between them.

1.2. Premises and Equipment

The hub of the farming operation is located in premises that will contain offices, storage, processing and packing facilities.

1.3. Products and Service

The plantation grows pineapples and provides the product in juice and fruit form. The centre has a place allocated for training where courses are offered to the community in all aspects of farming and agriculture. Team meetings and briefings are given here to keep the farming community aligned in the collective goal of the overall successful plantation.

1.4. Marketing

As a new venture the plantation activity is focused on growing the produce and delivering the entire first crops to a single customer at good price to them. For subsequent crops as the farming process matures, global marketing will increase starting with current main importers.

1.5. Finance

The long term financing of the venture is targeted at 75m Meticals (0.98m GBP, 16.8m SA Rand) for the whole 500 hectares that will be prepared and cultivated successively over a 5 year period. Projections show first revenue in month 10 and break even in month 21. Payback would be possible at the end of year 2 of the venture, but may be held over 7 years and paid as part of a cooperative share out.


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2. COMPANY DESCRIPTION

The company that will be conducting the project is RJR Serviços Limitada, a business registered in Mozambique and licensed to do all that is required of building, and commercialising a Plantation.

The project is being conducted on behalf of a community of woman farmers who have formed an association as a corporate entity that has officially mandated the project.

2.1. Company Registration

RJR SERVIÇOS LIMITADA, MOÇAMBIQUE (NUIT 400758298) is a 100% Mozambique registered company. Published in BOLETIM DA REPÚBLICA DE MOÇAMBIQUE, Quarta-feira de Junho de 2016 III SÉRIE – Número 65. Page 3788 Objecto:

Services Provided

Provision of services and logistics

Execution of works and technical assistance

Removal, assembly and sale of accessories for plumbing, gas, oil and metal structures

Restaurant and accommodation services

Import and export services

Sale of wholesale and retail products

2.2. Company Objective

To address the marginalisation of African women in the agricultural sector of Mozambique.

To provide practical education on farming as a means to sustainable livelihood and poverty alleviation.

To provide academic education on agricultural science for deep understanding on land cultivation and crop raising.

2.3. Company Background

The company was formed to assist artisanal fishermen and introduce them to international fleet owners to start joint ventures. Reputation grew while providing this service and we attracted the attention of the local community and were approached by a group of women farmers with a request to help them in the same way.

They asked for assistance with developing their small holdings to a level where they could compete in an international market place and achieve a level of profit that would take them to above the subsistence line.

We then started to work with them to build a plan for land preparation, ploughing, planting, irrigation, pesticides, herbicides and fertilizers, raising healthy crops, skilled picking and handling of produce, cold-storage, and juice extraction for added value for export and eventually marketing the product.


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Access to markets and reduction in post-harvest loss was our main concern. We determined that the scale and size of fresh produce markets in Mozambique alone is not enough to accommodate a Woman’s Union co-op farming development.

After some research we decided that the best approach to add value was to introduce farming technology, improve packaging and access export markets and to apply this to individual farmers grouped together into a cooperative business structure.

We decided to help and take on the challenge to secure a better future for the women, concentration on poverty reduction, creating employment, assisting and managing a sustainable farming development, education, skills transfer and introduction to the export markets. All of this to date is controlled by men.

3. OPPORTUNITY, INDUSTRY AND MARKET The motivation for this project is humanitarian as well as economic. We are addressing a widespread African problem; the poverty that exists among marginalized women whose efforts are exploited by an industry that conspires to keep them 'in their place'. We do not accept that. We think it's a waste of valuable human resources.

The tangible benefits from the project arise in four categories:

(1) Pineapple Products sold onto the international markets,

(2) Intellectual capital (farming 'know how' built through education of the women on the farms and in the administrative supply chain,

(3) Community prosperity that arises as a direct result of emancipation of a previously marginalised population,

(4) The template for similar projects that will result from this project successfully executed.

For the investor, he gets his investment of 75m Meticals (0.98m GBP, 16.8m SA Rand)) returned within a period of 7 years with a 4% planned profit.

The project is a consequence of our being asked for help by the local female farming community in Inhambane, Mozambique to develop a plan for a co-operative business that grows pineapples and produces juice for export to worldwide markets. The dual “Cash-Crop” will be Soya grown between the pineapple rows

The plan was conceived initially by an ambitious group of women farmers, each with a convicted interest in its success. They 'know' that the land can yield abundant crops and are aware of their shortfall in education and finance to make it happen. We see that as an encouraging indication that the entire prospective workforce of 300 women farmers will work very hard to do their part in bringing the project into reality, including attending classes for agricultural education and cooperating with management project controls procedures for keeping the project on track.

Having done research into the environment including soil research and crop requirements, we see this project as a potentially lucrative enterprise that if exploited in a co-operative business structure where all stakeholders benefit commercially from project success, will maximise the probability of success.

In terms of human interest, this project will have profound positive effect on the economy of the region of Inhambane. Currently women in agriculture in Mozambique are a wasted resource. Our experience shows that the attitude of women in this environment is exemplary in comparison with the men. Notably it is women who have come to us with their plan that is concerned not only with development of the plantation, but that also has a credible profitability structure that involve paying back the initial investment.


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There is a chance to conduct this project with full rigour of top class international project management methodology including Project Health Control that is overlaid onto classic Project Management Institute processes for project development through its lifecycle. The technical and managerial resources among the 5 key members of the project team have an ideal mix of skills necessary to make this project a resounding success.

3.1. Project Objectives

The overall objective of this project is to establish a simple and successful farming community based on a union of women co-op approach. Several objectives identified as integral to this main objective.

Objective Description

(1) An initial land allocation of 500 hectares will employ 300 women directly.

(2) Expansion to 1,000 and 1,500 hectares will occur in successive phases dependent on demonstrably successful cultivation of the initial 500 hectares in the first two years.

(3) Land will be granted by the Mozambique Farming Community. Taxation will benefit the Province as a whole.

(4) The women of the project will be educated in an in-house training facility on subjects that include crop growth and all the aspects of plantation development as the plantation matures.

(5) Marketing will be introduced into the in-house training at an elementary level and become more comprehensive in the second season, 20 months later.

(6) Development of the training facility will lead to the establishment of a college with an agricultural science curriculum that is recognised in Mozambique with a graduation certificate.

(7) Funds used in the start-up and development of the project will be repaid over a period of 7 years from profits in the sale of goods.

(8) An open style of collaboration will be established with related African business entities. A bank of information on tips, techniques and lessons learned will be developed and made available to all collaborating businesses.

3.2. Benefits and Beneficiaries.

There are a number of beneficiaries who enjoy various benefits from this project.

Benefit Beneficiaries

Revenue from supply of products, mainly Juiced Pineapples Investors, farmers, local community, state.

Employment Local workers

Productivity by addressing the gender inequality issue Women farmers

Satisfies a global demand for pineapple products Consumers worldwide

Education and training in farming methods Local workers, worldwide public


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Benefit Beneficiaries

Education and training in supply chain management Local workers, worldwide public

Education and training in project control methods Local workers, worldwide public

3.3. Why Pineapples

The climate in Mozambique is ideal for growing pineapples which need a tropical environment for best chance of a successful crop. Other crops will be grown also, a partial mitigation against risk of crop failure. Soya is the secondary crop. Pineapples are the primary.

Pineapples are a relatively labour intensive crop. Each has to be planted by hand, then while growing need to be tended. This time allows us the opportunity to educate the workers, in field and classroom, on how to farm successfully.

For the consumer, pineapples have widely publicised health benefits that fuels a demand.

References to Pineapple benefits are numerous:

http://www.gyanunlimited.com/health/top-10-amazing-health-benefits-of-pineapple-juice/6086/

http://www.livestrong.com/article/159381-health-benefits-of-pineapple-juice/

http://www.belmarrahealth.com/10-health-benefits-of-drinking-pineapple-juice/

https://www.tesco.com/groceries/product/details/?id=276956212

http://healthyeating.sfgate.com/pineapple-juice-effects-4383.html

http://www.stylecraze.com/articles/benefits-of-pineapple-juice-for-skin-hair-and-health/#gref

https://www.healthambition.com/health-benefits-of-pineapple-juice/

Another reason for Pineapples as a choice of main crop relates to the practicality of growing it. Pineapples are planted by hand and take 16 to 18 months to mature to harvest. During the growth, they need to be tended for and this needs consistent human interaction. This time with a slow growing crop gives us the opportunity to school the women on modern techniques of how to farm.

For faster growing crops, a high level of agricultural knowledge is needed, and whereas this is something that the farmers can aspire to, this project addresses the dignity aspect of production for the women, who will be learning about how to farm successfully while working.

3.4. The Market for Pineapples

The Pineapples are planted in November and December for optimum timing, but can be planted at any time, to fit in with other farm activities. They are planted by hand, not by mass seed spreading. It takes 18 months for a pineapple to grow from first planting. First harvest is one pineapple fruit per plant. Subsequent harvests annually yield up to 5 fruits per plant. After 5 years the plant is exhausted and needs to be replaced.


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There is a point in the growth of a pineapple fruit when it is judged to be available for harvesting. Irrigation can introduce constancy in fulfilment of water requirements to match the already ideal constancy of favourable climate. This means that harvesting is not done as a onetime activity but can be done in phases to supply a continual market demand.

One pineapple in two is now grown for sale on the export market. With an increased consumer demand for fresh pineapple and juice amounting to nearly 30 billion pounds a year, the pineapple export industry has developed into a complex supply chain.

Since 1960, pineapple production worldwide has risen by 400%. With the introduction of the "Gold" variety, developed and patented by Fresh Del Monte in the 1990's, the production of pineapple has grown again by nearly 50% since 1998.

Twelve countries absorb 90 % of the world demand of fresh pineapple. The US leads the demand and France, Japan, Belgium, Italy, Germany, Canada, Spain, England, Korea, Netherlands and Singapore share the rest of the supply.

References to Pineapple Markets are numerous:

http://www.asiafarming.com/pineapple-cultivation/

https://top5ofanything.com/list/e205c666/Pineapple-Producing-Countries

4. BUSINESS STRATEGY We sell juice as a luxury item to markets outside Africa. Strategy is product differentiation, 'Genuine Mozambique Organic Pineapple Juice'. We also sell more conventional fruit and Soya Bean and a range of other crops.

Revenue serves the business as a cooperative where profit is shared among stakeholders, including investors whose return is not fixed but variable over a period of seven years. Within the seven years, the return on investment will be according to profit.

4.1. Overall Business Strategy

We are working with sections of 500 Hectare (we call this a 'field'). For the first season, produce will be counted from one of the 500 Hectare sections (one field).

Each field produces 6m pineapples, which makes a total of 2m litres of juice (3 to 4 pineapples per litre).

We are considering several targets for revenue stream, each having market characteristics that need to be addressed separately: Fruit or Juice, allowable sale price per unit, shipping cost to the region, amount of product that can be accepted, what start up price per unit could be attractive for committed purchase. As soon as we secure enough demand for the first harvest, we stop looking and work towards that for the first two harvests.

First two harvests will involve one or more of these targets. Subsequent harvests will involve engaging them all in continual negotiation for production that will be adjusted continually to meet the demand.

Rather than bringing in a sales director at day one, we do the selling ourselves initially. Bringing the first few clients onboard not only builds confidence, but it also helps to create that all-important sales


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material. Our sales material will be refined and edited many times with the end result being a crisp, clean sales pitch that is easy to understand.

Once we have a clear understanding on the sales flow, we can then start to recruit that salesperson to take over the Sales-Arm of the Project. We need to establish and create core bread and butter accounts that will act as our underlying sales framework in place first, then once this network is built and ticking over nicely, look for the “wish list” accounts and the big ones that would be game changers to our Project.

We call upon our extended network, which will be willing us to succeed.

4.2. How we generate revenue

Initially we will sell to a prepared market limited to either one buyer or a few key buyers.

First harvests will go directly to the first pre-arranged buyers.

Examples of first buyers for pineapples and pineapple juice are Ceres, Compal, Parmalat. These organisations we know run out of pineapple juice before the end of east harvest year. There are many outlets for soya bean.

For subsequent harvests, once we have a fully working operation, we can expand the customer base and explore options for other crop juice sales or for selling the crops themselves (pineapples and soya).

We will nurture a contact network of distributors, and we can sell to end users by Internet service.

Revenue model allows for first revenue after 10 months that comprises advance sales of some cash crops before sales of pineapples for which the harvests are from 12 to 18 months. Start-up expenses are for machinery and materials.

We will invoke the age-old and trusted formula, the 100,10,1 rule. One hundred calls will get us 10 meetings and result in one sale. As we get better and more confident, the pitch gets cleaner, the meetings get easier and the numbers grow.

4.3. Key Milestones

There are milestones which are all critical to ensure Planting, which must be finished before the end of December (pre-requisite for pineapple crop).

Milestone Description

(1) Primary Research – done

(2) Feasibility Analysis - done

(3) Business Plan - done

(4) Funding Secured - target mid July 15

(5) Initial Purchasing - target early July 17 for major purchases to allow area works

(6) Soil Preparation - target finish end Oct 17 before planting

(7) Building works - to happen during soil preparation target finish mid Sep 17

(8) Planting - target start early Nov 2017 and finish mid Jan 2018.


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4.4. Barriers to Market Entry

The fruit and juice market is well established. We will have to adapt quickly to what we learn about how the market works and what is required of us from buyers.

Our starting point is simply to transfer all output to a willing buyer who must be contracted to receiving the produce before the project starts. We will be building relationships with all buyers in all countries in our target market as a continual mitigation of the risk of ineffective entry to the markets.

Produce can be stored for up to 12 months within which time it must be delivered and consumed.

5. MANAGEMENT AND OPERATIONS SUMMARY

5.1. Key People

Name Role Skills / Experience

David Project Manager

U.K. based BSc Engineering Graduate with 30 years of industry experience, heads up the project as manager and will introduce his vast knowledge on Project Health Control (PHC) to guide the project finances, time-line commitments and administration management, identifying dormant risks that can later impact on the project and remedy. His knowledge and understanding of project Y and X axis’ will guarantee that the project break-even point is met on time, implementing the correct tools to ensure that the project stays on track.

Garth Agriculture Specialist

Mozambique based, has the Landscaping and Horticultural skills and qualifications to implement the land preparation, apply 1

st phase fertilizers,

assisting in the planting of produce and manage the fertilizer, pesticide and herbicide programs.

Shaun Farm Manager

His degree and qualifications and years of experience with pineapples and produce destined for juice extraction will manage the land clearance and harrow activities, ploughing and contour establishment to avoid soil erosion with excessive rains, crop plantation and growth management to harvest stage and produce handling and cold storage.

James Works Manager

Civil Engineer and Construction Management National Diploma will oversee all land preparation for foundations of sheds, cold storage plants building or alterations of process facility, construction, fencing, project security, juicing and bottling and labelling and access roads establishment to and out of the plantations.

Gary Maintenance Manager

NTC 5 diesel fitter and turner and mechanic will be the plant manager overseeing all maintenance of farming machinery and process plant and repairs. His remote area with the challenges experience is sound for this project.

5.2. Our Collective Experience

Main application of experience will be over four areas. Irrigation, Land Preparation, Harvesting and Storage, Pest control.


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We have experience in cultivating a variety of different crops and access to technical knowhow for application of science to the agricultural challenge.

References to Pineapple Cultivation are numerous:

http://www.asiafarming.com/pineapple-cultivation/

5.3. The Plantation Process and Accommodation Layout

The document 'Plot Plans' show each part of the project territory as a series of progressively detailed maps from overview showing geographical boundaries and access roads, to detail of the office building and field layout.

The area at the centre of operations is organised into sections with logistic operations from planting through to harvest, processing, storage and dispatch.

5.4. Production Process

There are a few key processes that are needed on the project. We maintain documentation on all processes that is live and continually enhanced and refined as work progresses. The document 'Processes' shows all processes as lists of Activities in the form of 'What is done, by whom, with what materials, where, and using what equipment'.


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5.5. Producing Soya Beans

Establish proportion/area of land allocated to Soya Beans, Establish material needs (seeds, fertilizer, support structures), Prepare the land, Plant the crop, Monitor crop for growth status and signs of disease, Harvest, Transport to Pre-Market Preparation and Packaging Plant.

5.6. Producing Pineapples

Establish proportion/area of land allocated to Pineapples, Establish material needs (suckers & slips, fertilizer, support structures), Prepare the land, Plant the crop, Monitor crop for growth status and signs of disease, Harvest, Transport to production and Process plant.


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5.7. Making Juice Products

Receive fruit into production area, Prepare fruit for juicing / Make juice, Accumulate waste (for further processing), Package Juice into cartons, Package cartons into outer cartons, Label product for export.

5.8. Getting Product to Market.

Establish customer list, Agree pricing, Pack product into containers, Transport to port, Invoice.

5.9. Protection Against Disease and Pests

We use pesticides and herbicides to a timed programme of application to the fields. The document 'Disease Control Process' describes the process.

6. MARKETING PLAN

6.1. Finding Customers

For the first two harvests, we sell by previous agreement to a buyer or group of buyers already contracted to take the output.

For subsequent crops we will continue to develop a schedule of countries and importers that we can target for sales of the juice as a commodity that we should be supplying reliably to an expanding core set of customers.

We will continue to develop marketing strategies for finding customers in the target countries and getting commitment for their custom. For successive harvests we will commit an increasing percentage of the output to the customer network.

Once fully operational, each country identified as a target market, there should be activity in researching existing retailers who carry juice commodity from competitors. We offer our product at


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market prices with added value as branded from Mozambique and with characteristic taste that's consistent, perfected through the manufacturing process.

The product from the pineapple crop is Pineapple Juice. This product not suitable for the local market that would see it as a non-affordable luxury item. Main markets outside Africa are America, Europe and Asia. This will briefly entail the following:

Preliminary Marketing Strategy for Local Consumption 20%

Secondary Strategy for International Consumption of Excess Stock 80% also attracting Foreign Exchange

6.2. Understanding Competitors

Pineapples are grown in countries with tropical climates, like Hawaii, South America, Africa (south, and west) and Asia (southeast).

Top 5 Pineapple Producing Countries

Pineapple Production % of World Total

Costa Rica 2,685,131 m/t 10.8%

Brazil 2,483,831 m/t 10.0%

Philippines 2,458,420 m/t 9.9%

Thailand 2,209,351 m/t 8.9%

Indonesia 1,837,155 m/t 7.4%

Top 10 Producing Countries: Philippines, Thailand, Costa Rica, Indonesia, Chile, Brazil, India, Nigeria, Mexico and Colombia.

References to Pineapple Production are numerous:

https://top5ofanything.com/list/e205c666/Pineapple-Producing-Countries

6.3. Production Capacity

There is a limited production capacity for a given area of plantation. For the first season a subset of the plantation will be used to test the production process, 30% of total land available. The quantity of juice will be calculated from projected yield of pineapples and the actuality recorded against forecast. Predicted output for subsequent seasons will be progressively more accurate and useful as a target for sales activity.

Overall we are harvesting a maximum of 6,000,000 pineapples per season. This is processed into 2,000,000 litres of pure, pasteurised organic juice before we experience post-harvest loss. Our objective is to get through the first year minimising risk to the absolute minimum by prior agreement with a wholesale buyer. We are also growing cash crop of soya bean alongside the pineapples.


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For the purpose of modelling the production output of the project we are allowing for separate areas for each crop. In practise some crops will be grown together. This will tend to result in yields better than projected by our model and forms a level of contingency.

6.4. Go to Market Strategy

Strategy Description

Build Contact Network Attending luncheons and business breakfasts, LinkedIn, Business card & Stationery, Website, Seminars & Webinars, Newsletter [no bought in lists, we make our own], free special report, free gifts & content

Offer a Rebate

A rebate is a deferred discount, issuing a percentage of the price in cash after our Produce or Juice is purchased. Like a discount, but it alludes to a bond with the client, that sends a strong message. “Buy our produce and juice and we will look after you”.

Participate in Coupon Programs

Distributed through newspapers and magazines in the USA, U.K. and Europe coupons have long been an effective way to publicize products and increase sales.

The Internet introduced electronic coupons which will reduce the cost of distribution even further. Daily Deal Web-Sites such as Groupon and Living Social, aggressively seek companies willing to offer their products at a discount in return for exposure to their large markets of coupon users.

Local coupon aggregators combine the offers of different companies into books, which are then sold or given away to potential buyers. We need to research the market and find an issuer of coupons for our Juice.

Hone Our Pricing Strategy Price is the single most important factor in a decision to purchase a product or service. A low price can represent a “bargain” or low quality in the buyer’s mind.

Offer Special Discounts We can do this wherever it can secure the interest of new markets.

Reduce, or Eliminate Shipping and Handling Charges

We can do this wherever it can secure the interest of new markets.

7. FINANCIAL PLAN

7.1. Unit Costs for Cultivation and Juicing

We can predict the number of pineapples produced per hectare. We know the requirements for fertilizer, seeding, insecticide, and other material needs per hectare. We can therefore predict the cost of producing a pineapple.

We know how many pineapples are needed for a batch of cartons. We know the cost of packaging, labels, machine costs, and cost of transportation of batches to the port. We can therefore predict the cost per carton of juice.


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7.2. Set-Up and Running Costs

We have a simple list of cost items together with descriptions of their nature and use in our Financial Appendices.

7.3. Money Flow

We stick to government guidelines to the letter. Mozambique tax laws are straightforward. TTaxation is built into the financial forecasts.


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The NGO is central handling point for money from investment/funding sources, including investor's returns.

It is the Project that is responsible for deployment of funds from NGO and revenue from sales. Cash flow is planned and monitored in full scrutiny of all project stakeholders. There is nowhere for money to hide.


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Stage Timing Outline Finance

(1) Start-Up Aug, Sept

The wage part of the plan for the 4 ex-pats and the first 100 farm workers can start drawing wages. Land clearing and soil and harrowing and ploughing preparation. Project Manager will be occupied with Marketing of Cash-Crop. Soya.

See Financial Appendices

(2) First major purchases and planting

Oct, Nov, Dec,

Starting in August to allow a useful proportion of the land preparation and planting. 100 Hectares


(3) Operation Costs to break even

Jan 18 to Apr 19

Operations starting in August 2017, expecting first revenue in June 2018 from dual cash crop. Soya.



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8. APPENDICES

8.1. Appendix 1 – Expenses for 12 months’ Time-Line

A major part of the first year’s expenses are for establishing machinery and equipment.

There are many possible scenarios for developing the plantation and the variables include crop choice, amount of land and people employed. In this scenario we concentrate on cultivating 250 hectares from 500 initially available to the project. The remaining 250 hectares will follow in year two.

The projections show the results of cultivating 500 hectares and harvesting soya beans progressively and pineapples over an intensive 4 month period after 18 months from first planting.


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8.2. Appendix 2 – First Year Money Flow

To keep cash flow balance positive in this scenario, 75m Meticals is required until first income from soya bean harvest at month 10.


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8.3. Appendix 3 – Second Year Money Flow

Target revenue is projected to a level where payback of the initial 75m meticals should be possible in month 24, though in practise we intend to keep the initial sum as working cash buffer to ensure commercial viability through years 3 to 5 and beyond.

Total project cost at year two is projected as 127m meticals. Total project cost for the entire project through to year 5 and year 7 will depend very much on success achieved during the first two years.


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8.4. Appendix 4 – Planting Strategy

The amount of produce is estimated and the target projections will be refined as soon as the work on land preparation begins. As each hectare is cultivated, the objective is to maximise produce by implementing various configurations of planting. The figure above represents one such implementation. Other implementations will be made as experiments from which the results will direct future planting.


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8.5. Appendix 5 – Financial Modelling Spreadsheet

We operate two separate models for development. The first and primary model is a simple excel spreadsheet that allows what-if scenarios for testing profitability.

The four tabs are: (1) Cost Items, (2) Sale Items, (3) Currencies, (4) Income Expenditure

[see Appendix-2 and Appendix-3 – for first and second year’s income/expenditure]

The graphs in the Income_Exp tab are generated from raw data in the Cost Items and Sale Items tabs.

Document Title / Filename / Location

Financial Modelling Spreadsheet Financial_Model_20170719.xlsx

Tab – Cost_Items A5_Financial_Modelling1A.pdf

A5_Financial_Modelling1B.pdf

Tab – Sale_Items A5_Financial_Modelling2A.pdf

A5_Financial_Modelling2B.pdf

Tab - Currencies A5_Financial_Modelling3.pdf

Tab – Income_Exp Income_Expenditure_First_year3.pdf

Income_Expenditure_Second_year3.pdf

http://www.telford.phcportal.com/od/Plantation_BP/LinkedDocuments/Income_Expenditure_Second_year3.pdf

http://www.telford.phcportal.com/od/Plantation_BP/LinkedDocuments/Income_Expenditure_First_year3.pdf

http://www.telford.phcportal.com/od/Plantation_BP/LinkedDocuments/A5_Financial_Modelling3.pdf

http://www.telford.phcportal.com/od/Plantation_BP/LinkedDocuments/A5_Financial_Modelling2B.pdf

http://www.telford.phcportal.com/od/Plantation_BP/LinkedDocuments/A5_Financial_Modelling2A.pdf

http://www.telford.phcportal.com/od/Plantation_BP/LinkedDocuments/A5_Financial_Modelling1B.pdf

http://www.telford.phcportal.com/od/Plantation_BP/LinkedDocuments/A5_Financial_Modelling1A.pdf

http://www.telford.phcportal.com/od/Plantation_BP/LinkedDocuments/Financial_Model_20170719.xlsx


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8.6. Appendix 6 – Financial (Quantrix) Model

The second model is a comprehensive all-inclusive financial model.

Business information from the Quantrix model is used for company records and in published accounts.

The outputs included with the package have not been processed and will not be processed until the projecnt is started. They are included here only for information on how the business reporting will be done.

The data in these outputs is not for scrutiny as part of this business plan and will be developed with the project’s accountant after the project is started.


Profit & Loss

PL_Summary_Chart_STF_Agritech.pdf [Chart]

PL_Summary_STF_Agritech.pdf

PL_Detail_STF_Agritech.pdf

Income & Expenditure IE_Summary_STF_Agritech.pdf

IE_Detail_STF_Agritech.pdf

Cashflow Forecast CF_Summary_STF_Agritech.pdf

CF_Detail_STF_Agritech.pdf

Balance Sheet BS_Summary_STF_Agritech.pdf

BS_Detail_STF_Agritech.pdf

http://www.telford.phcportal.com/od/Plantation_BP/LinkedDocuments/BS_Detail_STF_Agritech.pdf

http://www.telford.phcportal.com/od/Plantation_BP/LinkedDocuments/BS_Summary_STF_Agritech.pdf

http://www.telford.phcportal.com/od/Plantation_BP/LinkedDocuments/CF_Detail_STF_Agritech.pdf

http://www.telford.phcportal.com/od/Plantation_BP/LinkedDocuments/CF_Summary_STF_Agritech.pdf

http://www.telford.phcportal.com/od/Plantation_BP/LinkedDocuments/IE_Detail_STF_Agritech.pdf

http://www.telford.phcportal.com/od/Plantation_BP/LinkedDocuments/IE_Summary_STF_Agritech.pdf

http://www.telford.phcportal.com/od/Plantation_BP/LinkedDocuments/PL_Detail_STF_Agritech.pdf

http://www.telford.phcportal.com/od/Plantation_BP/LinkedDocuments/PL_Summary_STF_Agritech.pdf

http://www.telford.phcportal.com/od/Plantation_BP/LinkedDocuments/PL_Summary_Chart_STF_Agritech.pdf


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8.7. Appendix 7 – The Plantation Project Presentation

This presentation is a live data bank containing questions and answers on the Plantation Project. It is intended as a tool for talks on the project for promotion as the project gets underway.

This is a living document that will develop rapidly during the early stages of the project and will be subject to changes and development throughout the life of the project.


Plantation Project Presentation [online] http://www.telford.phcportal.com/od/Presentation

Plantation Project Presentation Business_Plan_Presentation.pptx

8.8. Appendix 8 – Certificates and Documents


Article on Agriculture in Mozambique Agriculture in Mozambique.pdf

Certificate of Incorporation of the Women’s Association [Associacao Farmeiras Africanas Manhambanas]

FAM.pdf

Governor’s Endorsement of the Pinaple Plantation Project

Governor_Endorsement_20170614105103.pdf

Pineapple Plantation Project – Business Plan Mindmap Plantation Business Plan Map.pdf

Project Health Control (PHC) – tri-fold leaflet Project Health Control.pdf

http://www.telford.phcportal.com/od/Plantation_BP/LinkedDocuments/Project Health Control.pdf

http://www.telford.phcportal.com/od/Plantation_BP/LinkedDocuments/Plantation Business Plan Map.pdf

http://www.telford.phcportal.com/od/Plantation_BP/LinkedDocuments/Governor_Endorsement_20170614105103.pdf

http://www.telford.phcportal.com/od/Plantation_BP/LinkedDocuments/FAM.pdf

http://www.telford.phcportal.com/od/Plantation_BP/LinkedDocuments/Agriculture in Mozambique.pdf

http://www.telford.phcportal.com/od/Plantation_BP/LinkedDocuments/Business_Plan_Presentation.pptx

http://www.telford.phcportal.com/od/Presentation