EXECUTIVE SUMMARY

Flora poultry is a farm focused on rearing of Chicks for meat and egg production that provides
for a large market range. It is based in Port Harcourt city The founder have noticed the health
implication of red meat and are creating a business to meet the increased demand for white
meat . Chickens happen to be a great source of white meat and are also largely known for egg
production.

We plan on provide products with quality and maintain this supply efficiently. This is a
partnership business that plans on distributing chicken and eggs to bakers, restaurants, home
delivery food centers, hotels, schools, clubs, catering businesses and supermarkets. We also
plan on doing this at very affordable prices. We will also distribute manure to farmers that are
into crop production.

This business plan is meant to articulate the vision and future of our poultry, and to appeal to
investors and external stakeholders to get involved in this business and help with its funding as
it is a capital intensive business. We also hope that it will serve as a guideline for the firm’s
employees to move towards the goal of the poultry.

Not only do we offer products, but we offer services as well. We plan on providing home
delivery services to customers who order a certain amount of products. This offer will mostly be
used by the section of our target market that uses eggs in large quantities like schools and
bakeries.

1000 chicks would be optimum for the initial operation of the business. Production site is in
Port Harcourt City, plenty open space, cheap labors, road connection, water availability
and immediate access to markets like choba market. A house with 3 rooms will be rented for
the storage of pellets, equipments as well as for the employees to guard the farm. Revenue for
this will be gotten from contributions from each partner. Investment in this business shall be
allocated to the following purposes: buying chickens, building cage house, stocking the pellets,
hiring the experts and other miscellaneous tasks. Fifty percent gross margin is expected within
6 months of its operations withholding the chances of any accidental or unexpected incidence
and we hope to obtain the breakeven point within 2 years.

We have considered the risks, financial, health and technology wisely

Poultry farm Objectives

Flora 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.

Poultry farm Mission

Flora poultry’s mission is to provide customers with quality, fresh, and valuable products. To
respect all employees and enable everyone to have a say in company affairs. Quality and
service are our number one priority. To provide investors with opportunities to receive a nice
return on investment and high-quality growth. To contribute to the community through
physical and social programs. Flora’s poultry farm intends to have the largest poultry farm
products.  We plan to increase and expand our production of chicken to challenge the ever
growing demand for chicken products. The nutritious and protein rich products from our farm
would always be the first choice of our consumers.

Our keys to success

Flora poultry will follow these principles in order to achieve success in its market:

 State of art cage framework accommodating optimum number of chickens with

lessened possible hazards.
 Diverse slaughters network, market chain management, optimum inventory level and
‘customer is king’ policy.
 Regular visits by veterinary medical workers and hygienic poultry house environment.

COMPANY SUMMARY

Company Ownership

Flora poultry is sole ownership business. But investors are needed and welcome to increase our
business.

Location and facilities

At this point in the business, we don’t have an exact point yet but we have narrowed the
location down to Trans Amado. We are trading from this spot because is it a great place to
reach our target market. 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.
We plan on renting the building at first, and then buy it after we gain enough profit.

INDUSTRY ANALYSIS

Poultry industry in the last 40 years has shown dramatic changes in both domestics and
international environments. Those environmental forces include are classified into 2 categories:
the internal forces and external forces. Internal and external forces include:

1. Poultry industry competitors: When the company have few competitors, it is more likely to
get more profit. For example in Nigeria, competition is today driven by a cost of manufacturing
and the quality of products sold to the customers.

2. Supplier dynamics: Suppliers of raw materials to the poultry companies are the ones the
affect the costs of poultry products. If there is development of new market and technology, the
price of raw materials will remain low.

3. Opportunities: Like in Nigeria, there are many opportunities in poultry industry. The first
opportunity is that there is small number of large scale poultry farmers, and the other ones are
small scale business farmers. So this will make businessmen to vertically integrate in the poultry
business.

4. Cultural and religious forces: As we know, the presence of taboos can be a hindrance in the
development of poultry farming. However in Nigeria, there are very few, maybe none, laws or
cultures that prohibit eating poultry products. This is a good opportunity for businessmen to
develop and expand their poultry farm with in the country without any challenge.

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.
OPERATIONAL PLAN
The firm will be a commercial poultry farm; therefore it will require a full time labour and
geared towars productivity on a scale for the sales of egg and sales of broiler birds.For egg
production, birds usually starts to lay at 18-22 weeks of age and continue to lay for Twelve
months (52weeks) on average laying fewer egg as the new mounting period. The typical
production cycle last about 17 months (72 weeks) and involves three district phases as follows:
PHASE 1: Pullets or broilers: This phrase last from 0 – 8 weeks during which small chicks
(pullets) are kept separately from broilers.
PHASE 2 (GROWERS): This period concerned is between 8 – 21 weeks of age. Growers are the
future laying birds and the way they grow up will largely determine how well they do in the
laying house.
Therefore management during the growing period is very important.
PHASE 3 (LAYERS): The laying period is taken to have started when the birds reach 5% egg
production on a daily basis. The laying period continues until the birds are sold at the end of a
laying period of normal length or are force mounted Housing time starts with the beginning of
the laying period. The number of birds housed is the number of pullet in the laying house when
egg production starts.

POULTRY FARM PRODUCTS

Product description

We offer chicken meat that will be gotten from 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.
Fakabe poultry shall produce high quality, contaminant-free chickens to satisfy the taste of our
beloved costumers. The products shall be distributed into a number of distributors -
supermarkets, public markets, bakeries, restaurants and in the company’s own retail space for
easy access for marketing agents and consumers. In brief our products are;

 Main products
a) Live chickens
b) Eggs
 By-products
a) Chicken droppings
Future products

We have big plans for the future which is the sale of processed chicken meat.

Service Description

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

Production plan

In our poultry, we are planning to keep the 1000 chickens for meat and egg production. For
every 3 months, about 250 adult chickens will be sold and more chicks will be bought to
improve sales. 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,
 Land
 Area of about one plot will be allocated for the farm workers
 A building will be constructed for offices and store.
 Long-term assets including the refrigerator unit for the shop, window displays, a
refrigerated delivery van.
Raw materials used include
 Broilers
 Layers
 Water, Feed
 Equipments e.g brooding house, generator etc

Production process

With the broilers, we buy day old chicks that will mature into live chickens in 8 weeks after
which another batch of day old chicks will be bought.

Production systems

There are two main production systems in Nigeria. That is laying cage and deep litter systems.
a) Battery cage system

Here hens are kept throughout their productive life time in cages. However, this system
requires high capital investment. Each cage that will cage 50 birds cost N30, 000. Therefore, for
500 birds, it will cost N300, 000. In a battery cage system, hens do not have contact with
droppings which reduces infections. Feeding, providing water, removal of litter and cleaning are
easier for the poultry attendants to perform.

b) Deep litter system

Here hens are confined in a house with floor space of 8 to 10 birds/m 2 to ensure free
movement. The floor will be covered with a 5cm to 10cm deep litter of grain husks (maize or
rice), straw, wood shavings or a similarly absorbent (but non-toxic) materials. That’s why there
is sawdust in the budget. After old litter has been removed out of the house, the floor will be
cleaned and disinfected.

PREPARING FOR ARRIVAL OF CHICKS

The poultry house should be cleaned and disinfected and allowed to rest for at least 7 days prior to
chicks’ placement. Also, equipment such as feeders, drinkers, brooders etc. should be cleaned and
disinfected. Fresh litter (straw, wood shavings etc.) should be spread over the up. Wood shavings are the
common litter used in Nigeria. Litter provides insulation from the floor and will soak up moisture from
the droppings. It also helps to prevent damage to the birds’ legs due to slipping on slippery surfaces. The
depth of the litter should be 8 to 10 cm. Feed and clean water should be provided before chicks’ arrival.
Feed may be placed in flat surfaces such as egg flats or box lids to encourage chicks’ to feed. The
producer should introduce chicks’ to water by dipping their beaks in the water immediately they are
placed on the floor. Chicks’ may be encouraged to drink and feed by hanging bright 100 watt bulb 1m
above litter level. Furthermore, poults may be encouraged to eat by placing feed in small silver-coloured
trays, and to drink by placing coloured marbles in the drinkers. The heat source should be on 24 hours
before the arrival of poults.

Get Feeds, Feeders And Water Troughs

Chicken feed is very important if you want good harvest. You can buy feeds at stores and make sure you
buy the sack of feed that bears the label for the kind of chickens you have, such as Broiler starter, Chick
starter, Layer feeds, etc. The store feeds are basically balanced feed which will help your chickens do
fine if you don’t feed them other feeds. Avoid cheap feeds that have low nutritional value — your bird
wouldn’t do well with that, don’t just buy because they are cheap, buy because the feed is quality and
contains good nutritional value.

Most layers will start laying eggs the moment they are 18 weeks old but some wait till they are about 22
weeks old. Whichever way, Layer farming is considered the most lucrative of all poultry farming. This is
because Layers do two things, they lay eggs which fetch good money in the market, and are equally sold
for the meat.

MARKET ANALYSIS SUMMARY

Market segmentation

Although in the Nigerian 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 Christmas,
Eid-al-fitr, New Year, Easter etc.

Market Segmentation

Hotels and restaurants

Bakeries and food joints
Retail shops
Homes
Individuals

Others

Target market segment strategy

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

We have strategically placed our site close to these industries. They are restaurants, boarding
schools, home delivery food centers, retail shops and supermarkets.
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.

Market trends

While some countries are reputed to be important exporters of poultry products, Nigeria has a
problem of meeting its local demand of poultry products. This problem started for the poultry
market in 1984 when the federal government banned the importation of maize. This had quite
the effect on declining poultry production.

But the poultry market has seen more favorable times since the independence in 1960, peaking
in 1982 with 40 million commercially reared birds. But it has been declining since, to an
estimated 6 million in 1997. But then, it boomed again to 20 million in 2003 and has been
progressing ever so slowly since has more people are entering the poultry business.

In the poultry business now, most of the products supply comes from the informal farmers with
holdings of 50-700 birds. But then there are the “big guns” especially in the southern part of the
country, good examples being Obasanjo Farms (Nig.) Ltd and UAC foods.

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.

However, this is an increasing business in terms of number of people who are doing it. This is
because Nigeria still importing chicken product like eggs from other country. Our competitors
include those who sell meat and fish. Although those competitors are available, a large number
of Nigerians still lacking essential food components, which are proteins. According to data from
CBN and FAO, only 2Kg of beef is available to an average Nigerian per year, and only 4Kg of eggs
is available to each Nigerian in a period of one year. There are poultry farmers; however, many
of them are backyard farmers, small scale and they production is too low to satisfy the demand
of customers. The demand is high for live birds and eggs either for consumption or for gift in
the time of Christmas, New Year, Easter, id-el-fitri etc. restaurants, hotels, and supermarkets in
Nigeria. The products of poultry are also needed in fast food business which engages in the sale
of products like chicken, eggs bronze, etc. After having a look and analyzing this scenario we
decided to come in this industry to solve problem of malnutrition in our population. Therefore,
to achieve a breakthrough in our business we will be using our motto “customer is the king.”
This means that everything we will be doing is basically to satisfy the needs of our customers.

Business competitive edge

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

Flora 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, frozen ones will
also be available.

Pricing and Promotion strategy

The price of the chicken would range from N1500 up to N1700 depending on the size and
quality. The price of a wheelbarrow of manure costs about N200. The price of our eggs will
range from 1400-1700 depending the size. These prices would also vary depending on the
existing market price of poultry meat and eggs. As we compete with other poultries, we will
promote our products through advertisements with the aid of streamers and pamphlets. We
can also make our business known through recommendations and connections with well-
known businessmen in the locality. We will also make our products and service known in the
newspapers. We have created a website too to let the consumers know of our business.
Web strategy

Flora 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

MANAGEMENT SUMMARY

Management team

The management team is simply the partners in this business.

Organizational structure

1. Florence Akinwumi, Chief Executive Officer: As the top manager, the CEO, he is typically
responsible for the entire operations of the poultry. It is his responsibility to implement
decisions and initiatives and to maintain the smooth operation of the poultry, with the
assistance of the management team
2. Aisha Alimi, Manager: as the manager, she looks after issues related
to marketing, sales, production and personnel. More hands-on than the CEO, the manager
looks after day-to-day activities while providing feedback to the CEO.
3. Morgan Joy, Secretary will takes inventory on the whole operations going on in the farm
and takes record for all sales.

Personnel

Apart from the management team, other personnel include

1. Poultry Attendants
2. Security
3. Veterinary doctor
 4. Driver
There are 2 security, 2 poultry Attendants 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.

The staff will ne paid montly others include the veterinary doctors, drivers and technician that
we pay by the hour.
Labor in poultry farms are usually unskilled laborers who take care of the poultry services,
guard the chicken and its products and make deliveries. Their skills differ and they are mostly
temporary labor.
Labor size in poultry production is usually unstable.

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
 Chickens 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 by products(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
 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 like NAFDAC.

FINANCIAL PLAN

In every project found. We have to pass through the financed process. This have to do with the
starting of business, whether the personal income used or term loans from banks. In our
business, the financing structure and ways of doing it is like the path below.

1) Equity contribution: this cover the land we are using for the poultry, and also the facilities in
the building. The total income will be store rooms, office and constructions as well as the
furnishing part.

2) Personal income of 3,000,000 Naira, which will be used to start-up the operations, the
hatchery equipment and other equipment’s needed for the poultry.

Since for a part up business borrowing money from a bank is not advisable for our financing
project. Financing by loan becomes our secondary motive if we can get enough income for the
start up business. When we borrow and use personal income, it is easier to obtain and quicker
than loan. The tax rate is low.

Projected Income statement

Income 1st year 2nd Year 3rd year

Live chicken Sales 5,512,000 5,512,000 11,176,000

Fertilizers 41600 41600 50000

Eggs 5,553,600. 5,5556,00. 11,226,000

Total

Expenses

Feed 64000 64000 150000

Day old chicken purchase 10000 10000 30000

Insurance 25000 25000 25000

Long term assets 1601000 0 100000

Labor 960000 960000 960000

Business card 2000 2000 2000

Advertisement 10000 10000 15000

Other expenses 10000 20000 25000

Taxes 379760 379760 379760

Depreciation 49830 49830 49830

Total

Net income

In the third year, we are planning to increase 500 addition broiler chickens. This will make our
income to rise as well as the cost of feed and boiler chicken to increase. We will need also 2
additional cages that will cost N450,000. The depreciation amount comes from the equipment’s
that are expecting to be sold after a certain period of time.

Cash flow analysis

No Particulars Year 1 Year 2 Year 2

I Costs:
1 Capital cost 3,000,000 0 0
2 Recurring Costs:
a Land and building 1,601,000 0 0
b Cost of chicks 975,000 975,000 985,000
c Cost of feed 2,640,000 2,640,000 2,772,000
d Insurance 50,000 50,000 50,000
e Labor 912,000 912,000 900,000
f internet 50,000 50,000 50,000
g Business card 2,000 2,000 2,000
h Advertising 10,000 10,000 15,000
i consultancy 60,000 60,000 60,000
j Other expense 100,000 200,000 120,000
Total
benefits
3 Sale of manure 41,600 41,600 50,000

4 Sale of live chickens 4,704,000 4,704,000 4,754,000

5 Sales of Eggs 2,500,000 2,700,00 3,000,000
a Cages 25,800 25,800 25,800
b Computer and printer 6,430 6,430 6,430
c Other equipment 11,600 11,600 11,600
d building 6,000 6,000 6,000
7 tax 37970 37970 37970
Total benefit
Tax to be paid is 10% of the net profit. Depreciation on cages is 8.3% of the money we bought them.
Depreciation on computer and printers is 9.2% of the money we purchased them. Depreciation on
building is 3% of the money used to build. Depreciation on other equipment is 15% of the money we
purchased them.

Records management

As to records management, each project will have a record book on which information on the
number of stocked live birds, slaughtered and deaths are recorded. Record keeping will help us
to budget accurately and make informed decisions about the poultry. The records will contain
information such as

 All feeds consumed and purchased

 Number of hens purchased
 Deaths and causes
 Vaccination and other veterinary requisites expenses
 Labor and other variable costs
 Water and feed intake daily.

RISK ASSESSMENT

Financial risks
  Changes in our pricing policies or that of our competitors
 Fluctuation in revenue from distributors and retailers
 Timing of costs related to acquisitions or payments

Health risks

Contagious disease and virus outbreak is very deadly; if one of the chickens should catch the
disease, all of them will be affected and if it's not recognized and treated early it will lead to the
death of all the chickens which is a great loss for the business. And also some of the diseases
are also contagious to human not just between the chickens which will affect the workers and
also those that eat it.

Disease prevalence varies from one area to the other. The problems that may trigger disease
conditions are direct sunlight on the housing system, poor ventilated houses and very high
temperatures in and outside the poultry house. All these conditions will be avoided to the best
of our abilities.

Another thing we considered during the risk assessment is the mortality of the chickens which
is inevitable since we are dealing with living things. This can be managed with good
management and has been calculated to range between 5-10%.

Technological risks

Technology is good but they also have their disadvantages. There are normally problems
involved in using technology; the use of the machine that preparing the chickens after
slaughtering may fail to work or spoil, making the work slow and adding more cost to the
business by repairing it. The cost for electricity is also not easy and some electric problems can
lead to fire outrage and burn the building causing the loss of assets and perhaps the entire
business.

Contingency plans

As we considered these risks we have also made contingency plans for unprecedented events
or occurrences. As per the health risks, we will have plans with a veterinary doctor that will
have regular checkups with the chickens while giving them the best environmental conditions.
Another contingency plan we will make is insurance that will protect our assets. One of the risks
we have to face mentioned earlier, the occurrence of a fire outrage will be curbed by placing
fire extinguishers at strategic places. And in case of financial crises, we may have to resort to
getting loans.
Legal requirement.

To start a poultry farm business in Nigeria, one must fulfill the following requirement, business regis-
tration one must register with the Corporate Affairs Commission (CAC) in Nigeria. Corporate Affairs
Commission is a body of the Nigerian Government that is charged with the responsibilities to regulate
and manage companies in Nigeria. It was introduced in 1990 with the passing of the companies and
allied matters act. It is headed by a chairman and closely assisted by the registrar general/ CEO.Local
Government Food Permit and Business Permit, a food/business permit must be obtained from the
Environment Service Department where the poultry farm will be situated. The poultry farm will be in-
spected by health officers for health and safety compliance. Once the permit is approved, business op-
erations can commence. Evidence of Tax Payment, the payment of tax by all businesses is a requirement
in Rivers State. it is advisable to have a photocopy of any tax payments for presentation when
approached by authorities.

Registration with Associated Industry Body, this is not compulsory, but it is advisable to register with an
associated industry body for example; the Poultry Association of Nigeria for information sharing and
collaboration. This will be useful to overcome common challenges and it could aid business growth.

(Cooperate Affairs Commission 2012)Corporate Affairs Registration 20,000 Once yearly

Local Govt. permit & licensing 10,000 Once Yearly.

FEASIBILITY REPORT ON 1000 POULTRY BIRDS ON FLORA POULTRY

IN

PORT HARCOURT CITY,

RIVERS STATE, NIGERIA

ELENWA FLORENCE AKINWUMI