Final project old

BUSINESS PLAN

BUSINESS: Dairy Farming

NAME OF THE FARM: VOICE:

Email -id:

Proprietor

NAME : Ashish Kumar

Sex : Male

DOB : 07 July 1992

Home : Danapur Patna 801503

Voice : 9504603272, 8409399411

Email-id : [email protected]

Qualification:

B.B.A.(Graduation) B.S. College M. U.(Bihar) Patna 2010-til it

Intermediate R.P.S. college B.E.I.C. Patna 2009

10th Baldev inter school B.S.E.B DANAPUR 2007

Experience

Work as Customer care executive for two month in call to connect India pvt ltd.

Objective

Establishment of small dairy farm.

Providing employment for at least 7-10 people.

To reduce milk crises.

Awareness' for organized dairy farm.

mailto:[email protected]

Executive Summary

Why do Dairy Farming?

Dairying is an important source of subsidiary income to small/marginal farmers and agricultural labourers. The manure from animals provides a good source of organic matter for improving soil fertility and crop yields. The gober gas from the dung is used as fuel for domestic purposes as also for running engines for drawing water from well. The surplus fodder and agricultural by-products are gainfully utilized for feeding the animals. Almost all draught power for farm operations and transportation is supplied by bullocks. Since agriculture is mostly seasonal, there is a possibility of finding employment throughout the year for many persons through dairy farming. Thus, dairy also provides employment throughout the year. The main beneficiaries of dairy programmers are small/marginal farmers and landless labourers. A farmer can earn a gross surplus of about Rs. 12,000 per year from a unit consisting of 2 milking buffaloes. The capital investment required for purchase of 2 buffaloes is Rs. 18,223/-. Even after paying a sum of Rs. 4294/- per annum towards repayment of the loan and interest the farmer can earn a net

surplus of Rs. 6000 - 9000/- approximately per year. (For details see model scheme enclosed). Even more profits can be earned depending upon the breed of animal, managerial skills and marketing potential.

According to World Bank estimates about 75 per cent of India's 940 million people are in 5.87 million villages, cultivating over 145 million hectares of cropland. Average farm size is about 1.66 hectares. Among 70 million rural households, 42 per cent operate up to 2 hectares and 37 per cent are landless households. These landless and small farmers have in their possession 53 per cent of the animals and produce 51 per cent of the milk. Thus, small/marginal farmers and land less agricultural labourers play a very important role in milk production of the country. Dairy farming can also be taken up as a main occupation around big urban centers where the demand for milk is high.

Scope for Dairy Farming and its National Importance

The total milk production in the country for the year 2001-02 was estimated at 84.6 million metric tonnes. At this production, the per capita availability was to be 226 grams per day against the minimum requirement of 250 grams per day as recommended by ICMR. Thus, there is a tremendous scope/potential for increasing the milk production. The population of breeding cows and buffaloes in milk over 3 years of age was 62.6 million and 42.4 million, respectively (1992 census)

Central and State Governments are giving considerable financial assistance for creating infrastructure facilities for milk production. The ninth plan outlay on Animal Husbandry and Dairying was Rs. 2345 crores.

Introduction

Description of the Business: The farm is into the business of selling quality cow milk.

The Vision: Our Farm is committed to provide quality and unadulterated milk to our customers.

Business Organization: The form of organizational structure chosen is sole proprietorship, as the capital required

is not very high and the entire range of business activities can be efficiently handled by a single person.

Growth Trends in This Business: The market for cow milk is always growing constantly. India's annual milk production has more than tripled in the last 30 years, rising from 21

million tons to 80 million tons in 2001.

Targeted Market and Customers: Our customer would be the co-operative milk society in the town.

Licenses: License is not mandatory for dairy farming.

Insurance: Each cow will be insured with “Cattle and livestock insurance” with a premium of Rs.

----per annum (as per norms). Secondly employee of farm will be also insured with health insurance and other if

needed, so they would be free from fear of disease.

Marketing Mix

Marketing mix is the primary responsibility of marketing. By offering the product with the right combination of the four Ps marketers can improve their results and marketing effectiveness.

Place The location of plant is in Maner. Its land is 3 kattha.

Advantages of location of Plant (Maner) are below:-

Fodder Farm is 1km far only. Maner is Proprietor’s home town and having his goodwill in this area from last

5decade. Therefore support of people will be always with the RNSpam dairy farm. Well constructed road connected to national highway with 2 way (approx 1km away)

with two way. Well draining system is available. Well established market is nearby, carrying all facilities. Veterinary hospital facilities are near by.

****Farm is 1 bigaha to cultivating green fodder in home village hulasitola****

Product The farm is into the business of selling quality cow milk. Our farm will milk and sell it in market. This product is highly demanded in the market due to scarcity of good quality of

milk. Our customer would be the co-operative milk society in the town and consumer will be local people of Patna district.

Production parameter of RNSpam

1. Order of location - one year

2. Milk yield - 15 liters / day

3. lactation day - 365 to 450 days

4. Dry days - 120 to 150 days

Price The price of milk is growing rapidly so there is no matter of good price of milk. Recently average price of milk in Patna market is Rs 15 to Rs 30 in society (Sudha, Raj, & natural etc) and retail(individual people) respectively. So the standard price that is assumed by the company is Rs.15.

PromotionPersonal selling of milk will be done to sell the product. No need to perform other promotional activity for our product.

SWOT Analysis of business

Strength

Proprietor is having PGDM (MBA) degree.

Own land and farm of Proprietor

Market is not going to ruin.

Higher demand of Milk.

Income from the day, first

Utilization of wastes (Gaumutra, Goabar)

Weakness

High maintenance

Opportunity

Less competition

High revenue

Threat

Communicable Disease

Uncertainty of productivity

FINANCIAL PLAN

Start up Working Capital / month

Sl. No.

Particular Physical unit & Specification Cost (in Rs)

1. Man power see in technical aspect para / section 16,500

2. Doctor + Medicine 5,000 + 5,000 10,000

3. Fodder + All required Rs.100 * 30Cows /day 90,000

4. Green fodder Farming in own farm 1350

5. Diesel Transportation + Generator 20,000

6. Electric bill 1,000

7. Stationary 500

8. Miscellaneous Charges 3,000

Total Start-up Expenses / month 1,42,350

Projected Start -Up Expenses Fixed Cost

Sl. No. Particular Physical unit & Specification Cost (in Rs)

1. Shed 1 2,00,000

2. Cow (30unit * Rs30,000) 9,00,000

3. Cost of transporting of Cows From purchased town 1,00,000

4. Pick up van 1 3,00,000

5. Milk Cain’s 6 15,000

6. Milking Machine 1 20,000

7. Chaff cutter 1 5,200

8. Milk containers (Balti) 10 3,000

9. Nad 30 20,000

10. Feed grinder & Mixer 1 25,000

11. Weighing machine 1 10,000

12. Driver for 3 months 7,500

13. Skilled & unskilled staff for 3 months 27,000

14. Manager for 3 months 15,000

15. Veterinary Doctor + Medicine for 3 months 30.000

16. Feed and fodder for 3 months 2,74,050

17. Electric Connection 3 KVA) 10,000

18. Generator 1 61,500

19. Tube lights + Fans + wiring 20 + 15 + as per required 25,000

20. Pump set (including pipe) 2 (Plant + farming) 50,000+65,000

21. Furniture 20,000

22. Others 1,00,000

Total Start-up Expenses (A) 22,82,750

Start-Up – Assets & liabilities

Assets

Particular Amount (Rs)

Cash Required 2,50,000

Long-term Assets (land, live stock, etc….) 5,00,000

Total Assets 7,50,000

Total Requirements (Total Start-up Expenses (A)

+ total asset)

30,32,750

Liabilities

Liabilities Amount (Rs)

Capital

Prashant Nirala (30,32,750)

Start-up (Start-up Expenses = 22,82,750) 7,50,000

Total Capital 7,50,000

Sale Forecast

1. Income from Milk = Rs. 20, 25,000

(a) Milk per day - 30cows * 15lits = 450 lits(b) Rate of Milk - @Rs.15 / Lits(c) Daily Income from milk - Rs. 6,750(d) 300 days income from milk - Rs. 20,25,000

**Selling in society**

Projected cash flow statement

Particulars Amount (Rs)

Cash Received

Cash from Operations

Sales Rs. 20,25,000

Cash Receivables 1,25,000

Total Cash Received (A) 19,00,000

Expenditure

Expenditure from Operation

Cash Spending 2,00,000

Bill Payment 50,000

Total Cash Spend (B) 2,50,000

Net cash flow (A-B) 16,50,000

Cash Balance (16,50,000+2,50,000) 19,00,000

Profit & Loss A/C

Income

Particulars Amounts in (Rs.)

Sales 20,25,000

Total Sales (a) 20,25,000

Expense / yearly

Sl. No. Particular Physical unit & Specification Cost (in Rs)1. Payroll See in Technical aspect para / section 1,98,000

2. Medicine 5,000/month 60,000

3. Fodder + All required Rs.80 * 30Cows /day * 365 days 8,76,000

4. Insurance 5% of each cow’s cost 45,000

5. Diesel Transportation + Generator 1,00,000

6. Electric bill 500 / month 6,000

7. Stationary 250/month 3,000

8. Miscellaneous Charges Purchasing + Welcome 50,000

Total Expenses (b) 13,38,000

Profit Before Interest and Taxes (a-b) = “20,25,000 - 13,38,000” 6,87,000

Interest Expense -

Taxes Incurred _

Net Profit 6,87,000

Projected Balance Sheet

Assets …

Current Assets Amount(Rs)

Cash Balance 19,00,000

Accounts Receivable 1,25,000

Total Current Assets = 20,25,000

Long-term Assets

Long-term Assets (land & live stock) 5,00,000

Accumulated Depreciation (20,000)

Total Long-term Assets = 4,80,000

Total Assets 25,05,000

Liabilities…

Particulars Amount (Rs)

Current Liabilities

Accounts Payable 20,000

Sundry creditors 1,24,000

Total Current Liabilities = 1,44,000

Capital 30,32,750

Start up expenses (22,82,750)

Earnings 6,87,000

Total Capital = 14,37,000

Total Liabilities and Capital = 15,81,000

Profit & Loss A/C for next 3 years

1. First year Profit & Loss A/C

Snapshot Total no. of cow 30 units

Sale Forecast


a) Milk per day - 30cows * 15lits = 450 litsb) Rate of Milk - @Rs.15 / Litsc) Daily Income from milk - Rs. 6,750d) 300 days income from milk - Rs. 20,25,000


Expense / yearly

Sl. No. Particular Physical unit & Specification Cost (in Rs)1. Payroll See in Technical aspect para / section 1,98,000

2. Medicine 5,000/month 60,000









Interest Expense -

Taxes Incurred _

Net Profit 6,87,000

2. Second year Profit & Loss A/C

Snapshot

Purchasing of 15 Cow in next batch Total no. of cow 45 units Incrimination of one skilled employee

Sale Forecast


a) Milk per day - 45 cows * 15lits = 675 litsb) Rate of Milk - @Rs.15 / Litsc) Daily Income from milk - Rs. 10125 / dayd) 300 days Income from milk - Rs. 30,37,500


Expense / yearly

Sl. No. Particular Physical unit & Specification Cost (in Rs)1. Payroll (6 employee) See in Technical aspect para / section 2,34,000

2. Medicine 7500 / month 90,000









Interest Expense -

Taxes Incurred _

Net Profit 11,61,800

3. Third year Profit & Loss A/C

Snapshot Purchasing of 25 Cow in next batch Total no. of 100cow units

1st year + 2nd year + 3rd year = Total 60 units + 15 units + 25 units = 100 units Incrimination of two skilled & two Unskilled employee

Sale Forecast


a) Milk per day - 100 cows * 15lits = 1500 Lits

b) Rate of Milk - @Rs.15 / Lits

c) Daily Income from milk - Rs. 22,500/ day

d) 300 days Income from milk - Rs. 67,50,000


Expense / yearly

Sl. No. Particular Physical unit & Specification Cost (in Rs)1. Payroll (10 employee) See in Technical aspect para / section 3,78,000

2. Medicine 16,666 / month 2,00,000

3. Fodder + All required Rs.80 * 100Cows / day * 365 days 29,20,000

4. Insurance 5% of each cow’s cost 1,50,000


6. Electric bill 1,000 / month 1,20,000

7. Stationary 500 / month 6,000

8. Miscellaneous Charges Purchasing + Welcome 4,00,000



Interest Expense -

Taxes Incurred _

Net Profit 24,26,000

1. First year Profit = Rs 6, 87,000

2. Second year Profit = Rs 11, 61,800

3. Third year Profit = Rs 24, 26,000

4. fourth year plan = check out below future plan

5. fifth year plan = check out below future plan

Future plan of RNSpam dairy farm

In time span of 1 year, RNSpam dairy farm will be well established to move properly in milk production, Cow management, etc.

In second and third year Rnspam dairy farm will extend its arms in both direction vertically by opening outlets nearby such as Maner, Bihta, Danapur, etc to sell Ghee, Butter, Peda, lassi etc as well as horizontally by opening Collection centre also parallels as per requirement for our product.

In fourth to fifth year, The goal of RNSpam is to reach on such a position that it can be RNSpam Pvt. Ltd.

TECHNICAL ASPECTS

Managerial Staff

Sl. No. Post of Employee unit Payment /month1. Veterinary Doctor 1 5,0002. Driver 1 2,5003. Skilled & unskilled 1 3,000 *

Housing:1. Construction of shed on dry, properly raised ground.

2. Avoiding of water-logging, marshy and heavy rainfall areas.

3. The walls of the sheds would be 1.5 to 2 meters high.

4. The walls would be plastered to make them damp proof.

5. The roof would be 3-4 meters high.

6. The cattle shed would be well ventilated.

7. The floor would be pucca/hard, even non-slippery impervious, well sloped (3 cm per

meter) and properly drained to remain dry and clean.

8. Providing 0.25 meter broad, pucca drain at the rear of the standing space.

9. A standing space of 2 x 1.05 meter for each animal is designed.

10. The manger space would be 1.05 meter with front height of 0.5 meter and depth of

0.25 meter.

11. The corners in mangers, troughs, drains and walls would be rounded for easy

cleaning.

12. Provide 5-10 sq. meter loaf space for each animal.

13. Providing proper shade and cool drinking water in summer.

14. In winter & raining, Animals will be kept indoor during night and rain.

15. Controlling of external parasites (ticks, flies etc.) by spraying the pens, sheds with

Malathion or Copper sulphate solution.

18. Draining of urine into collection pits and then to the field through irrigation channels.

19. Disposal of dung and urine properly. A gobar gas plant will be added further.

20. finally giving an healthy and adequate space for the animals.

****Housing Space Requirements for Crossbred cattle Annexure I ****

Electricity

1. Source of electric Connection - BSEB

2. Approval of Connection cost - Rs. 5,000

3. Connection Load - 3 KVA

4. Problems of power failure - 8 hours

5. Arrangements for generator – Rs.61500 (Honda-EXK2800S)

Water (farming & plant)

1. Source - Ground water

2. Quality of water - Drinkable / Good

3. Investment (2units) - Rs. 50,000 + 65,000

4. Structure - Boring

5. Design - Submersible Motor(plant) + diesel engine(farm)

6. Availability of sufficient quantity for drinking, cleaning nad, fodder production,

as well as cultivation.

Milking of Animals 1. Milk of the animals two times a day.

2. Milking at fixed times.

3. Milking in one sitting within eight minutes.

4. Milking would be done by the same person regularly in a clean place.

5. Washing of the udder and teat with antiseptic lotions/ luke -warm water and dry before

milking.

7. Milk will be free from any contagious diseases and should wash his hands with

antiseptic lotion before each milking.

8. Sick cows will be milked at the end to prevent spread of infection.

Selection of Animal

1. Proposed species - Jersey, Sahiwal

2. Source of purchase - West Bengal, Haryana , Panjab

3. Cost of animals - Rs. 30 (average)

4. Purchasing freshly calved animals in their second/third lactation.

5. Before purchasing, ascertain actual milk yield by milking the animal three times

consecutively.

6. Identification of the newly purchased animal by giving suitable identification mark

(ear tagging or tattooing).

7. Vaccination for the newly purchased animal against disease.

8. Firstly, Newly purchased animal would be under observation for a period of about two

weeks and then mix with the general herd.

9. Purchasing of the second animal/second batch after 5-6 months from the purchase of

first batch of animal.

10. As cow are seasonal calvers purchase them during July to February.

11. As far as possible purchasing of the second batch animal when the first animal is in

its late stage of lactation and is about to become dry, thereby maintaining continuity in

milk production vis-à-vis income. This will ensure availability of adequate funds for

maintaining the dry animals.

Breeding Care 1. Observation of the animal closely and keeping specific record of its coming in heat,

duration of heat, insemination, conception and calving.

2. Source semen - Artificial insemination

3. Location - At dairy farm only

4. Expenditure - Rs. 500 / yrs

5. Breeding of the animals when it is in peak heat period (i.e. 12 to 24 hours of heat).

Care during Pregnancy

Special attention will be provided to pregnant cows two months before calving by providing adequate space, feed, water etc.

Feeding of Milch Animals

1. Feeding the animals with best feeds and fodders. That may be in such a combination

2. Quantity required (kg./day)

Cost(Rs. / Kg) Lactation period Dry Period Young Stock

Green Fodder Rs. 3 7kg 4kg 2kg

Dry Fodder Rs. 2 10kg 8kg 4kg

Concentrates Rs. 20 3kg 2kg 1kg

3. Green fodder will be grown on my own farm itself for this purpose all facility

will be arranged by own like Boring and own land are also available.

4. The oil cakes would be flaky and crumbly.

5. Moisten of the concentrate mixture before feeding.

6. Providing adequate vitamins and minerals including salt licks besides addition

of mineral mixture to the concentrate ration.

. Providing adequate and clean water by own pump-set.

7. Arrangement of adequate exercise to the animals. Cows would be taken for

wallowing. In case if this is not possible sprinkle sufficient water more particularly

during summer months.

8. To estimate the daily feed, the animals should consume about 2.5 to 3.0 percent

of their body weight on dry matter basis.

**** Feeding schedule is given in Annexure III****

Protection against Diseases / Veterinary Aid

1. Always alert for signs of illness such as reduced feed intake, fever, abnormal discharge

or unusual behavior by permanent veterinary Doctor.

2. Always a veterinary doctor will be with team for help if illness is suspected.

3. Protection of the animals against common diseases.

5. Periodic tests would be arranged for Brucellosis, Tuberculosis, Johne's disease,

Mastitis etc.

6. Deworm the animals regularly.

****Vaccination schedule is given in Annexure II****

Marketing of Milk

1. Source of sales - Co-Operative milk society

2. Place of disposal - Raj dairy Pvt. Ltd.

3. Distance (km.) - 2 km

4. Price realised - Rs. 15 / lit

5. Basis of payment - Cash / cheque

6. Periodicity of payment - Weekly

7. Marketing of milk immediately after it is drawn keeping the time between production

and marketing of the milk to the minimum.

8. Washing of milk cans thoroughly with detergent and finally rinse with chloride

solution to handle milk in hygienic way.

9. Transporting of the milk during cool hours of the day.

Care of Calves

1. Feeding colostrums to calf.

2. Assisting the calf to suckle if it is too weak to suckle on its own within 30 minutes of

calving.

3. Keeping the calf separately from birth till two months of age in a dry clean and well

ventilated place.

7. Protecting the calves against extreme weather conditions, particularly during the first

two months.

8. Group the calves according to their size.

9. Vaccinate calves.

Equipment/Plant and Machinery :i) Chaff cutter

iii) Milking machine

iv) Feed grinder and mixer

v) Milking pails/milk cans

Annexure I

Housing Space Requirements for Crossbred cattle

Age-group Manger Space (mtr.)

Standing or covered area (sq.mtr.)

Open Space(sq.mtr.)

4-6 months 0.2-0.3 0.8-1.0 3.0-4.0

6-12 months 0.3-0.4 1.2-1.6 5.0-6.0

1-2 years 0.4-0.5 1.6-1.8 6.0-8.0

Cows 0.8-1.0 1.8-2.0 11.0-12.0

Pregnant cows 1.0-1.2 8.5-10.0 15.0-20.0

Bulls* 1.0-1.2 9.0-11.0 20.0-22.0

Annexure II

Programme for vaccination of farm animals against contagious diseases

Sr.

No.

Name of disease

Type of vaccine

Type of vaccination

Duration of immunity

Remarks

1 2 3 4 5 6

1 Anthrax (Gorhi) Spore vaccine Once in an year premonsoon vaccination

One season -

2 Black Quarter (Sujab)

Killed vaccine - do - - do - -

3 Haemorrhagic Septicaemia (Galghotu)

Ocladjuvant vaccine

- do - - do - -

4 Brucellosis (Contagious abortion)

Cotton strain 19 (live bacteria)

At about 6 months of age

3 or 4 calvings

To be done only in infected herds

5 Foot and Mouth disease (Muhkhar)

Polyvalent tissue culture vaccine

At about 6 months of age with booster dose 4 months later

One season After vaccination repeat vaccination every year in Oct./Nov.

6 Rinderpest (Mata)

Lapinised avianised vaccine for exotic and crossbred catte, caprinised vaccine for zebu cattle.

At about 6 months of age

Life long It is better to repeat after 3 to 4 years

Annexure III

Feeding Schedules for Dairy Animals

(Quantity in Kgs.)

S.No. Type of animal Feeding during

Green Fodder

Dry Fodder Concentrate

1 2 3 4 5 6

(A) CROSSBRED COW

a) 6 to 7 litres milk per day

Lactation days

Dry days

20 to 25

15 to 20

5 to 6

6 to 7

3.0 to 3.5

0.5 to 1.0

b) 8 to 10 litres milk per day

Lactation days

Dry days

25 to 30

20 to 25

4 to 5

6 to 7

4.0 to 4.5

0.5 to 1.0