Ground-Maker™ A Product of Pound-Maker Agventures Ltd. AgEc 75.6 Capstone Final Presentation AgEc 75.6 Capstone Final Presentation Chad Nykolaishen Michael

Ground-Maker™Ground-Maker™A Product of Pound-Maker Agventures Ltd.A Product of Pound-Maker Agventures Ltd.

AgEc 75.6 Capstone Final Presentation AgEc 75.6 Capstone Final Presentation Chad NykolaishenChad NykolaishenMichael WheelerMichael WheelerKristen BestropKristen BestropSarah EymannSarah Eymann

Ground-MakerGround-Maker 22

Ground-Maker™Ground-Maker™

Ground-Maker™ is finished compost Ground-Maker™ is finished compost acquired from Pound-Makeracquired from Pound-Maker

Has many advantages for soil Has many advantages for soil improvementimprovement

Plans are to process 450 tonnes of Plans are to process 450 tonnes of compost/yearcompost/year


Philosophy Philosophy

Focusing on Saskatchewan Focusing on Saskatchewan Focusing on the environment in mind Focusing on the environment in mind Trying to use our resources and Trying to use our resources and

markets to the fullestmarkets to the fullest


Where?Where? Small bagging and storage facility to be Small bagging and storage facility to be

built near Pound-Makerbuilt near Pound-Maker Compost will be hauled from Pound-Maker Compost will be hauled from Pound-Maker

to our facilityto our facility

Operations Plan Operations Plan


Organizational StructureOrganizational StructureBoard of

Directors 7 External, 1 Internal

Manager

Marketing Department

Operations Department

Secretary/Treasurer

Bagging Technicians

ShareholdersShareholders Investors Investors ManagerManager


Site PlanSite Plan


Floor PlanFloor Plan


Site Setup Site Setup

Land costs: (10ac)Land costs: (10ac) 3,7503,750

Site Setup:Site Setup:

Yard lightsYard lights 2,0002,000

BuildingBuilding 86,80086,800

Swage SystemSwage System 3,5003,500

Electricity installation Electricity installation 25,00025,000

Town water installationTown water installation 14,30014,300

LandscapingLandscaping 400400

Total:Total: 135,750135,750


Building CostsBuilding Costs

Building Costs:

Cover-All 60,000

Office Building 20,000

Sasktel 500

Plumbing 6,000

SaskPower 300

Total Building Costs: 86,800


The FacilitiesThe Facilities

Large shell type building for bagging Large shell type building for bagging equipment and storageequipment and storage


Equipment CostsEquipment Costs

Equipment Costs:

Bagger 45,505

Screener 49,595

Scale 6,500

Total cost of equipment: 103,600


Flow of Work ChartFlow of Work Chart


Work Plan Work Plan

Plan to operate year round with Plan to operate year round with processing during certain monthsprocessing during certain months

Haul compost from Pound-Maker in fallHaul compost from Pound-Maker in fall Bag half of the product in the spring and Bag half of the product in the spring and

the other half in fallthe other half in fall 2 full time employees and 3 part time 2 full time employees and 3 part time

employees. employees.


Cost of Goods SoldCost of Goods Sold

Beginning finished goods inventory is Beginning finished goods inventory is $0$0

Cost of goods manufactured is Cost of goods manufactured is $$38,09938,099

Cost of goods available for sale Cost of goods available for sale $38,099$38,099

Ending finished goods inventory Ending finished goods inventory $3,500$3,500

Costs of goods sold is Costs of goods sold is $34,599$34,599


Costs of Goods ManufacturedCosts of Goods Manufactured

Direct materials

Bags $4,784

5,714

Handling $930

Nutrient tests $500

Direct laborPart time baggers $3,960 4,213

Overhead

Variable Overhead $8,212

28,172Fixed Overhead $19,960

Cost of good manufactured 38,099


Production and InventoriesProduction and Inventories

Production of compost for bulk is Production of compost for bulk is 100 tonnes and for bags 350 tonnes 100 tonnes and for bags 350 tonnes which is equal to 17,500 bagswhich is equal to 17,500 bags

Average days inventory will be held Average days inventory will be held for 60 daysfor 60 days

Year ending inventory is equal to Year ending inventory is equal to $3500 $3500


Working CapitalWorking Capital

A/R 3,538

Raw Inventory 0

Finished Inventory 3,500

A/P 13,839

Total: 20,877


Capital Budget SummaryCapital Budget Summary

Land 3,750

Building 86,800

Equipment 106,200

Working Capital 20,877

Total Capital Required 217,627


FundingFunding

Private and business investmentPrivate and business investment LoansLoans Possibility of Pound-Maker investingPossibility of Pound-Maker investing

Human Resources Human Resources Plan Plan


Human ResourcesHuman Resources

Manager/Marketer- to have a degree Manager/Marketer- to have a degree in business managementin business management

Secretary/Accountant- post Secretary/Accountant- post secondary diploma secondary diploma

Baggers/Screeners- grade 10 Baggers/Screeners- grade 10 education. Knowing how to work the education. Knowing how to work the machines is more important. machines is more important.


Human Resources PlanHuman Resources Plan

Wages:

Manager / Marketer 59,000

Secretary 15,000

Baggers @ 3 people @ $11.00/hr 3,465

Employment Insurance 986

Canada Pension Plan 1409

Workers Comp 784

Total of wages: 80,644

Marketing Plan Marketing Plan


The Marketing MixThe Marketing Mix Products & Services – composted beef Products & Services – composted beef

cattle manure in bulk and 20kg bagscattle manure in bulk and 20kg bags Pricing – competitive pricingPricing – competitive pricing

- selling bags for $6.00/bag- selling bags for $6.00/bag - selling bulk for $225/tonne- selling bulk for $225/tonne Promotion – promote locallyPromotion – promote locally - environmentally friendly- environmentally friendly - natural product - natural product Place – based mainly in Saskatchewan Place – based mainly in Saskatchewan

through retail and direct salesthrough retail and direct sales


Opportunities and ThreatsOpportunities and Threats

OpportunitiesOpportunities

-growth in organic farming-growth in organic farming

-environmentally friendly -environmentally friendly

-contracts-contracts

-gardening industry is growing-gardening industry is growing ThreatsThreats

-how much product will be sold-how much product will be sold

-indirect competition is the greatest threat-indirect competition is the greatest threat


Competition - BagsCompetition - BagsAgricore – the real Agricore – the real thingthing

Lethbridge, ABLethbridge, AB

40L is 40L is equal equal to to 18kg18kg

$8.98$8.98

NU- GrowNU- Grow

Calgary/OntarioCalgary/Ontario20kg20kg $3.99$3.99

Green LeafGreen Leaf

Olds, ABOlds, AB20kg20kg $3.68-$3.99$3.68-$3.99

Wholesale Wholesale $2.44$2.44

***Prices shown are retail prices which may vary.


Competition - BulkCompetition - BulkLakeshore Garden Lakeshore Garden CentreCentre

$24.99/cubic yard$24.99/cubic yard

RetailRetail

Wilson’s GreenhouseWilson’s Greenhouse $14-$15/cubic yard$14-$15/cubic yard

Own UseOwn Use

Agricore – the real Agricore – the real thingthing

20 tonne truck 20 tonne truck delivered $600.00delivered $600.00

***Prices shown are retail prices which may vary.


Segmentation, Targeting and Segmentation, Targeting and PositioningPositioning

Segmentation – environmentally friendly Segmentation – environmentally friendly green thumb green thumb

Targeting – gardenersTargeting – gardeners - green houses, landscapers- green houses, landscapers

Positioning – promote environmentally Positioning – promote environmentally friendly productsfriendly products


S.W.O.T.S.W.O.T.

Human ResourcesHuman Resources

Strengths Strengths

- Ground-Maker does not require a - Ground-Maker does not require a large number of laborerslarge number of laborers

WeaknessWeakness

- seasonality and location- seasonality and location


S.W.O.T.S.W.O.T.

Physical ResourcesPhysical ResourcesStrengthsStrengths

- located by the supplier - located by the supplier - deals with a large company - deals with a large company - only large scale operation in - only large scale operation in

Saskatchewan * Saskatchewan * WeaknessWeakness

- climate only allows the company - climate only allows the company to operate during certain months due to to operate during certain months due to coldcold


S.W.O.TS.W.O.T

Financial ResourcesFinancial ResourcesStrengths Strengths

- lower over head- lower over head- inventory level is low in off - inventory level is low in off

season.season.WeaknessWeakness

- profits are based less on large - profits are based less on large margins and more on volumemargins and more on volume

- pay out large dividends in the - pay out large dividends in the second year.second year.


Market AnalysisMarket Analysis

On average a store sells around 400 On average a store sells around 400 bags a yearbags a year

61 garden centers in Saskatchewan 61 garden centers in Saskatchewan 14 landscaper companies in Saskatoon 14 landscaper companies in Saskatoon 15 greenhouses in Saskatoon 15 greenhouses in Saskatoon Potential for increased sales due to Potential for increased sales due to

increased environmental awareness and increased environmental awareness and Kyoto Kyoto


Marketing StrategyMarketing Strategy

Sales and Profit- receiving 20% on Sales and Profit- receiving 20% on selling of 450 tonnes across selling of 450 tonnes across Saskatchewan. Saskatchewan.

Channels of Distribution- bags sold Channels of Distribution- bags sold retail and bulk will be sold direct.retail and bulk will be sold direct.

Pricing Policy- making 20% of the Pricing Policy- making 20% of the price Ground-Maker will receiveprice Ground-Maker will receive


Marketing StrategyMarketing Strategy

Select Markets/Products/Service Mix- Select Markets/Products/Service Mix- competitive market, consisting of competitive market, consisting of peat moss and chemical fertilizerspeat moss and chemical fertilizers

Selling and Advertising – Selling and Advertising – – advertising through a web page, flyers, advertising through a web page, flyers,

& pamphlets. & pamphlets. – marketing manager will be traveling marketing manager will be traveling

around promoting the product.around promoting the product.


Marketing Plan BudgetMarketing Plan Budget

Marketing and Advertising :

Traveling 500

Cell phone 480

Internet - Web page 350

Flyers and pamphlets 300

Trade shows 3,000

Hotel 1,200

Meals 300

Business Cards 100

Total $6,230


Selling FeaturesSelling Features

Saskatchewan made productSaskatchewan made product Natural fertilizerNatural fertilizer Contains less weed seeds and Contains less weed seeds and

pathogens than raw manurepathogens than raw manure Slowly releases nutrientsSlowly releases nutrients

Financial PlanFinancial Plan


Income StatementIncome Statement

Sales Revenue:

Bulk 22,500

Bags 119,000

Total 141,500

Cost of Goods Sold 34,599

Gross Margin 106,901

The quantity stays the same, but the The quantity stays the same, but the inflation rate of 2.5% is added on to each inflation rate of 2.5% is added on to each year.year.


Year One Cash Flow Year One Cash Flow

Cash from (used in) operating Cash from (used in) operating activities $42,218activities $42,218

Cash from (used for) financing Cash from (used for) financing activities $257,597activities $257,597

Cash from (used for) investing Cash from (used for) investing activities $241,950activities $241,950


Risk AnalysisRisk Analysis

Over the next 10 years Ground-Over the next 10 years Ground-Maker is very stable with no Maker is very stable with no extremes. extremes.

Internal Rate of Return is 26.2%Internal Rate of Return is 26.2% External Rate of Return is 19.2%External Rate of Return is 19.2%


Worst, Base,& Best Case Worst, Base,& Best Case Scenarios Scenarios

Variable Worst Case Base Case Best Case

Quantity of Sales

50% 100% 110%

Average Selling Price

75% 100% 125%

Average Trucking Costs

150% 100% 75%


Dividend PolicyDividend Policy

Dividends are paid out when cash Dividends are paid out when cash available exceeds 1.5 times the cash available exceeds 1.5 times the cash required for the following year. required for the following year.

Dividends start being paid out in the Dividends start being paid out in the second year. second year.

Questions?? Questions??

Documents

Ground-Maker™ A Product of Pound-Maker Agventures Ltd. AgEc 75.6 Capstone Final Presentation AgEc 75.6 Capstone Final Presentation Chad Nykolaishen Michael