Date: Author: Address:

December, 2009 Joseph Kaisa P. O. Box 16 Jinja Uganda

Tel E-mail

: +256(0)-755-489171 : jkaisa@yahoo.com

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0. Executive Summary ........................................................................................... 3 1. THE BUSINESS ................................................................................................. 4 2. THE ENTREPRENEUR ........................................................................................37 3. THE FINANCIAL PLAN ..................................................................................... 399 4. THE DEVELOPMENT IMPACT ............................................................................ 455

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0. Executive Summary
Concept The Dairy industry in Uganda has to date in general , not adopted the improved
managerial and technological advances available world wide, which would have resulted in improved, efficient and profitable production of milk and other dairy products for the majority of Ugandans. Through this business plan, Kaisa Bamulangeyo and Sons Ltd., a Ugandan Company and part of a breeders association will use leading dairy management and technology to improve milk production levels, efficiency and profitability. Promoter Kaisa Bamulangeyo and Sons Ltd. is a Ugandan company with over 25 years experience in dairy farming. The company is a family business with eleven shareholders. The Market The national milk market is estimated to be 660 million litres per annum, valued at Ug. Shs. 330 billion. The current supply, as estimated by the annual report on Development of Animal Production and Marketing by the Ministry of Agriculture, Animal Industry and Fisheries, is 625 million litres. The market t herefore is not satisfied by the current supply. Management Kaisa Bamulangeyo and Sons management has long and substantial experience in dairy farming. The company has in addition to its experience established a strategic alliance with a dairy production and reproduction expert. Operations The operations will centre around the goals of achieving the production of 3,295 litres of milk per day and the starting of production of cream and butter. To achieve this production, high yielding cows will be purchased to add to the existing stock. There will also be improved nutrition and improved farm operations. Appropriate technologies and work processes will be adopted to achieve these objectives. Financials The projected sales revenue is in USD 512,816 for the first year; 725,699 for the second year; and 1,054,417 for the third year. The net profit is projected in USD to be 143,076 for the first year; 154,244 for the second year; and 291,597 for the third year. Overall, therefore, the financial basis for the concept to produce and sell dairy products in Uganda is promising. Investment The total investment in plant and equipment is estimated at USD 662,170. Kaisa Bamulangeyo and Sons. Ltd. expects to raise this through a combination of debt , equity, retained earnings and own contribution . Conclusion The final conclusion to be drawn is that the promoters and partners have the required technical capacity and are committed to running an efficient and profitable dairy enterprise, the business concept and ideas are realistic, the macro economic and political conditions are acceptable, the market potential is there, the human resource situation at Kaisa Bamulangeyo and sons Ltd. can be improved adequately, the risks and negative environmental impacts can be remedied, the financial viability of the project is commendable and the farm¶s impact on Uganda¶s society overall will be positive. The business plan is therefore technically and economically viable.

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1.1 Business model and value proposition
Kaisa Bamulangeyo and Sons Ltd., hereinafter referred to as the Kaisa Farm, is a Ugandan company whose principle business and subject of this business plan is milk production and processing. Milk produced by the farm is sold both as raw and processed milk. The farm is a member and leading organiser of the Kamuli Breeders Association and the East African Association of Dairy Stakeholders . The farm is also currently mobilizing small milk producers into an association for purpose of collecting and selling milk. The raw milk is sold to price and quality conscious households with relatively lower incomes, in suburban towns / trading centres on the Kamuli ± Jinja highway; around Jinja town; on the Jinja ± Iganga highway and around Iganga town. The Kaisa Farm targets to increase its customer base in this market segment and gain loyalty from these customers, to whom the biggest milk suppliers in the country do not sale too, given that they are not in the main urban centres where the biggest milk suppliers target. To do this, the farm will offer: (1) High quality milk sold in permanently established farm outlets within the proximity of the customers residences, with refrigerators to keep the milk at 4 degrees centigrade that is not adulterated as per normal practice of raw milk vendors. (2) A relatively lower price for the milk, given that middlemen have been eliminated and that the farm enjoys economies of scale given its production facilities that are relatively larger than most of the competitors in this market segment. (3) Delivery of appropriate quantities very early in the morning, to ensure availability of milk throughout the entire day till late at night when customers stop purchasing. The processed milk is sold mainly to middle and high income class household consumers that prefer a richer taste of milk (i.e. no fat/cream removed). These are mainly in urban centres. The processed milk is sold through primarily retail outlets (shops, kiosks, and supermarkets/groceries), secondarily through institutions (universities, colleges, schools and eating places) and thirdly hotels (e.g. The Nile resort hotel in Jinja). Like the raw milk, Kaisa Farm targets to increase its customer base in this market segment and to gain loyalty from these customers through emphasis on: (1) The quality of the milk with a rich taste. In comparison, some processors adulterate their milk to get more revenue from increased volumes, or sale milk with reduced fat. (2) Attractive packaging (3) Delivery of appropriate quantities very early in the morning to ensure availability of milk at the retail outlets. The Kaisa Farm customers therefore should expect value for money with the knowledge and satisfaction that they have received their worth for the money they would have spent ± that is - high quality nutritious milk to enhance the health of their households. The Kaisa Farm production facilities are located 65km outside Jinja, the second largest town in Uganda. The farm is comprised of four separate units (Namisambya- 95 acres; Naminage ± 185 acres; Namasagali-233.5 acres; and Nakavule-700 acres) with a total of 1,214 acres of land. The main unit, Namisambya, holds the farm¶s dairy processing and milling equipment. The dairy processing plant can pasteurise, homogenise and package up to 1,000 litres of milk per hour. The cooling storage facilities have a capacity of 5,000 litres. The distance between the four farming units are considerable. The distance measured from the main unit, Namisambya (95 acres) to other units are as follows: 4km to Naminage (185 acres); 30km to Namasagali (233.5 acres) and 15-20 km to Nakavule (700 acres). The roads connecting the four farming units are mostly dust roads. Namisambya, Naminage and Namasagali have reasonable infrastructure in form of buildings, roads and fencing, whereas Nakavule, was acquired recently and is yet to be fully developed.

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½.054. With total operating costs of US $ 308. second and third year respectively.649 for the first.900 litres of milk per day and sell an average 1.2 Products The Kaisa farm will sale both raw and processed whole milk. The whole milk has a higher fat content than the competitors¶ milk and a richer taste. Kaisa Farm will expand the current product range of raw and processed milk half-way through the first year to include cream and butter. In comparison. to assist with this effort. US $ 334. The farm therefore hopes to realise a total income from operations (EBITDA) of US $ 203. The farm however hopes to make total sales of US $ 512. processing and sale of processed and raw milk as follows. To achieve the above production it is anticipated to cost the Kaisa Farm US $. 1. The farm has established a strategic alliance with a livestock production expert who has extensive experience in animal production and reproduction. In the below tables (1.KAISA FARM BUSINESS PLAN To produce the milk. Kaisa Farm envisages to achieve production.170 in extra investment in fixed assets over the three year period of this Busi ness plan. 662.877. The Kaisa Farm focus is on quality ± both for the processed and the raw milk. US $ 725.445 and US $ 580. Within the three year timeframe of this business plan. The Kaisa Farm targets low income class households in suburban / trading centres for the raw milk and middle and high income class household consumers in urban centres for the processed milk.417 in the third year. 2. Breeding of the animals is mostly through Artificial Insemination (AI) an d over the next three years also through Multiple Ovary Embryo Transplant (MOET) for accelerated increase in high yielding animals. the farm breeds the cattle which are used for milk production. most vendors of raw milk and some processors adulterate their milk to get more revenue from increased volumes. The raw milk will be sold from established farm outlets established near the residences of the customers.1 Target market and customer base The Kaisa Farm operates in its home region with emphasis on the nearest big towns ± Jinja and Iganga. 3 and 4) the Kaisa Farm has listed key characteristics of the buyers of the various products marketed by the Kaisa Farm.699 in the second year and US $ 1.3 Market structure and analysis 1. Sales in the greater Kampala area and Entebbe were suspended due to high overheads given the level of production. and 1 litre plastic pouches bearing red and blue colours.939. The processed milk will be sold under the brand name ³Kaisa Fresh Milk´ and will be packaged in ¼.816 in the first year. He will be responsible for breeding of the animals on the farm and backstopping all farm activities. Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 5 . At the end of the three year period the farm would process and sell 3. It will be stored at 4 degrees centigrade to ensure that it maintains its quality at the point when bought by the customers.568 for the first second and third years respectively over the period of this business plan.000 litre of raw milk per day.254 and US $ 472. The Kaisa milk selling slogan ³NO ADDITIONS NO SUBTRACTIONS ± WHOLE FARM MILK´ puts emphasis on the quality of the product sold by the Kaisa Farm.3. 1. US $ 391.

Mainly in Jinja and Iganga. ³Individuals who take it directly. small-scale business people. Business people. Business persons. (1) Availability (2) Quality (3) Price Families Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 6 . ³They take it directly as a substitute to other products. Men and women. Men and women mainly of the lower income bracket. (1) Convenience (one litre pack). Some Kiosks (small shops). Table 4 ± raw milk Sold where: Sold through: Person buying: Characteristics: Reasons for buying: Consumer (end-user): Suburban and small trading centres. Supermarkets and Hotels. Universities. Families. mostly middle income bracket. Probably not focused on price. Other: See: person buying. Kaisa Farm outlets ± stored in containers in refrigerators. children. They purchase it for taking at home boiled as tea and/or as part of the children¶s nutrition. Sold through: Person buying: Characteristics: Reasons for buying: Consumer (end-user): Table 3 ± ¼ litre packs Sold where: Sold through: Person buying: Urban areas. ³the man on the street´. with some few in suburban areas. young adults and blue collar workers. Mostly men.KAISA FARM BUSINESS PLAN TABLE 1 ± 1 litre packs Sold where: Sold through: Person buying: Characteristics: Reasons for buying: Consumer (end-user): Table 2 ± ½ litre packs Sold where: Urban areas. Younger people. mainly middle and high income bracket. Mostly Jinja (centre) has been sold in Kampala (centre). Age 40+.´ (1) Price (2) Taste and (3) Quality Families Characteristics: Reasons for buying: Consumer (end-user): Mostly University and secondary school canteens Universities and schools: Directly to canteens. formal dressing (long sleeves and tie). Grocery stores and kiosks.´ (1) Price (2) its nutritious Universities and schools: Young people age group 12 ± 25. Has been sold in Kampala in the suburbs. All age and social groups. (2) Quality. or micro business owners. Schools and students. Other: Mostly children. Mostly employed in the informal sector.

5 MAIN REASON FOR CHOICE OF MILK TYPE (%) Cheapest type 50. and likewise declines in the dry season when supply is low and prices are high (author¶s field survey/experience). middle and high -income groups¶ consumption patterns. 1.3 6. There are clear differences between the low.3.g.3 UHT milk 6. 330 billion if based on t he lowest market cost of Ushs.: y Apart from direct consumption by children.4 83.4 2. y Farm families consume 50 ± 70% of the production directly at home. especially for the raw milk consumers to develop loyalty thus repeated sales over a long period of time.0 6.5 litres/day).g. When looking at the demand for / the consumption of milk in Uganda.7 73. a survey carried out by the International Livestock Research Institute revealed the following (see table 5 below) y y Table 5 .7 13.3 Fresh whole milk 56. 10%.consumption patterns for low.0 6.7 Most preferred 26. the average per capita consumption of milk (raw and processed) in Uganda is 30 litres per year (0. the estimated consumption of milk in the country stands at 660 million litres per annum (22 million X 30 litres/capita). Of the remaining 30 ± 50%. in different areas. with different incomes and backgrounds. farmers and traders sell 90% in the informal market. Middle and High Income groups.08 litres/day).3 0. most of the purchased milk is used for making beverages such as tea and coffee. however.3 Natural flavour 13.6 Total (%) 100 100 100 Avg.3 Only type available 3. There is also a tendency. There has lately. This equals to Ushs. Likewise the reasons for buying the various milk products differ.3 13. thus increasing its customer base. certain patterns emerge.7 10.0 3.7 Any type 13.0 13. e. HOUSE HOLD INCOME CATEGORY Type of milk consumed Low Income Middle Income High Income (%) (%) (%) Pasteurized Milk 23. 500/litre. been a change in adult consumption. quantity of milk consumed per day 1.4 3.3 13. E.2 Market size and potential According to the Dairy Development Authority (DDA) publication ± Dairy industry at a glance.3 Total 100 100 100 Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 7 . Consumption of unprocessed milk increases substantially during the wet season because of increased supplies and depressed prices.7 3. where direct taking of milk is increasing.7 56.KAISA FARM BUSINESS PLAN It can be concluded from the above that the Kaisa Farm reaches quite different segments.7 16.4 73. and rest. The reasons why these segments are served by the Kaisa farm is to reach a wide range of segments with the various products. Given the total population of 22 million people.3 6.3 High quality 6. This is only 15% of the per capita consumption level recommended by World Health Organization equal to 200 litres per year (0.7 0. is processed and sold in the formal market.

3 year out look It can be predicted that the demand for milk in Uganda. The steadily improving levels of education and spreading of health clinics are both seen as factors that are likely to increase the population¶s awareness of the benefits of milk. -The average consumption per day per household is 3. Growth in the national economy will result in increased demand for milk. (See table 6) Table 6 . overall. middle and high income groups. Urban population Low Income Middle Income Proportion of population 61% 29% Consumption 20% 43% High Income 10% 37% Furthermore it should be noted that urban consumption of milk per day per capita is estimated to be around 39 litres. Middle and High Income households: -Predominantly consume pasteurised milk and are not price sensitive. Through the yearly June dairy month celebration. Given a choice and ability to pay. will increase over the next three years for the following reasons: y The Uganda economy is estimated to grow by approximately 6% per year in the next three years. This increases the Kaisa Farm¶s sales potential. The Land O¶ Lakes. middle and high income groups consumption of milk in urban areas.5 litres for the high ± income groups ± much higher than for the low and middle ± income groups. as the fresh whole milk usually is the cheapest type of milk. This is estimated to be 30 litres. extensive coverage of milk promotion is carried out in newspapers and television. This is considerably higher than the national average. It can be concluded from the above that in urban centres.4 litres. there exists a general preference for pasteurised milk. y y Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 8 . These two findings support each other. Of the above information. These income groups choose what they prefer the most. which is pasteurised milk. There are clear differences between the low. being very price sensitive. USAID sponsored program seeks to create a higher awareness about the values of milk.consumption patterns for low. low income groups. in spite of their relatively bigger numbers. consume less than the high income groups. As Uganda is enjoying considerable economic growth the demand for pasteurised milk is likely to grow.KAISA FARM BUSINESS PLAN It can be concluded from the above that: Low-income households: -Mostly consume fresh whole milk (raw/loose milk). the following is relevant to the Kaisa Farm: The biggest household consumption of milk ca n be found in the middle and high -income households in urban areas. -The average consumption per day per household is 1. The Kaisa farm will target these promising markets with the pasteurized milk and will target low income households with the raw / loose milk .

± (See table 7 below) Table 7 ± potential Kaisa Farm sales per day Area Kampala Market Central zone Nakulabye-Kasubi-Kawala Bakuli ± Mengo-Rubaga-Kisenyi Kalerwe ±Bwaise-Kawempe-Bombo Bweyogerere-Banda-Nakawa-Luzira-Makindye-Gaba Ntinda-Bukoto-Kyebando-Bahai Mbalala-Lugazi-Mbiko-Nyenga Sub Total Entebee Market Entebbe Town Kampala-Entebbe Sub Total Jinja Market Central Suburbs Sub Total Iganga Market Central Suburbs Sub Total Grand Total Kaisa Farm Planned Production Potential Sales per day (Litres) 2010 2011 2012 2013 450 120 130 310 410 150 110 1680 513 137 148 353 467 171 125 1915 590 157 170 406 538 197 144 2202 649 173 187 447 591 216 159 2423 280 485 765 319 553 872 367 636 1003 404 699 1103 650 83 733 741 95 836 852 109 961 937 120 1057 390 61 451 3629 1500 445 70 514 4137 2700 511 80 591 4758 3740 562 88 650 5233 4900 The above figures are encouraging as they indicate that the demand is likely to increase and faster than the growth in the Kaisa Farm production. which the Kaisa Farm serves: The Uganda National Housing Survey estimates that the consumption in the Kaisa Farm¶s main markets Jinja/Iganga. is no guarantee Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 9 . y There are efforts to introduce school milk programmes. Kampala and Entebbe will increase by 10%.KAISA FARM BUSINESS PLAN y Schools are visited and free milk provided and exhibitions are carried out in different towns all over Uganda. Based on this survey¶s percentage estimates. however. The predictions above for the national level are also seemingly valid for the geographical areas. Market potential for Kaisa Milk in target Market. The same programme could be implemented in the army. whereby every child in Primary schools drinks a quarter of a litre of milk per day. This. 2011 and 201 2 respectively. a forecast has been made for the potential market for the coming years for the Kaisa Farm¶s main markets (and added a conservative 10% for 2013). consumption of milk on the whole has increased especially in schools. As a result. 14% and 15% for 2010.

Another dairy plant (White Nile) was about to close. 1. have a bigger market share.3. The processo rs with a higher installed capacity however. however. y y y y y y y Raw / loose milk vendors / suppliers Vendors / suppliers of raw / loose milk are predominantly operating in the informal sector. The Kaisa Farm has three main competitors in its main markets Jinja and Iganga. are the majority nationally and even in the urban areas which is the focus of the formal (processed) milk market. It was. This means that the competition on the Kaisa Farm¶s supply side for raw milk is low. however. It was not possible to establish the exact profits or losses of each processor. Whether the Kaisa Farm can sell it products will depend on a number of factors. Namely Dairy fresh. generally agreed that processors who are vertically integrated and/or having value added products are making a profit. There does not seem to be any particular correlation between performance and number of years in business. As mentioned earlier. they take about 90% of the milk market share and predominantly serve low ± income households. Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 10 . Nearly all processors are producing below the installed capacities. Most of the processors purchase milk from Mbarara and sell it in Kampala. As such there are no recorded statistics of their operations as individuals. They. which implies high transport costs.KAISA FARM BUSINESS PLAN that the Kaisa farm can sell its products. There does not seem to be any particular correlation between performance and the size (installed capacity) of the processors. but was taken over by new management. with production ranging between 20% . Milk processors characteristics By talking to six operating processors (although most were not willing to give much information) and by researching various published sources some characteristics that bear mentioning about processors are: y A number of dairy plants have closed down operations.35% of the installed capacity. GBK and White Nile. Only White Nile purchases raw milk. in the same area as Kaisa Farm. the most important being the market strategy adopted by the Kaisa Farm and how it positions itself in the market to effectively compete with other processors/producers.3 Competitor analysis Competition in the Uganda dairy industry exists in four different forms: Competition Competition Competition Competition from from from from milk processors ± formal sector raw/loose milk vendors/suppliers ± informal sector imported milk substitutes The four forms of competition are analysed below. A difference in distance of about 320 kilometres.

In Jinja. Nabuka Diary co-operative society in Mukono district.) Source: Department of Statistics . Direct raw milk sales to consumers by farm house holds. the volumes are too small to have any impact/effect on the market. imports of milk and other diary products is insignificant on the Uganda Market.644 877. Large proportions of the consumers are highly price sensitive which will make them opt for the raw / loose milk. Large farms usually use marketing agents who collect milk from a number of farms and then sell in the urban centres to urban households.984 865 10. 3. however.000 litres of milk daily. Moreover.Entebbe 2008 713 355 7. From discussions with key informants it is estimated that in Kampala and Jinja alone these distribute approximately 50. There are some suppliers/farmers who bring in milk from in and around Jinja. It is estimated Pevinta sells a total of about 600 litres of milk daily.495 159. Equator Katwe Dairy in Luwero district.218 2006 650 1. there are many suppliers without significant barriers to enter the market. As indicated in the table 8 below.KAISA FARM BUSINESS PLAN Raw Milk supply includes: 1. The supply from these is. institutions such as schools and army barracks.907 86. Table 8 ± Imports of Dairy products by year Milk and Cream of = <1% fat (Skimmed) ± (Kgs.082 319. which is then sold either directly to individuals/institutions or to marketing agents. There are a number of dairy cooperatives. Kibuye Diary. Imported Milk According to the Master plan of the Dairy sector. and Kungu Dairy co-operative in Mpigi district.) Milk and Cream of > 1% but < 6% fat ± (Kgs. small and non-consequential. House holds with small herds often sell their surplus milk in surrounding local markets.5% (Powder milk) (Kgs. Milk collected by dairy associations.) Milk and Cream of > 6% fat (Kgs. hotels. the biggest percentage of milk comes from milk agents. transporting milk from Kamuli district. 2.784 Milk Substitutes Instead of taking milk 80% of consumers interviewed by Kaisa Farm mentioned that they would take the following products. One major retailer ± Pevinta Fresh Dairy. The dominant associations/co-operatives include: Nakasongola co -operative union in Kampala.700 267 625. It can be concluded that the competition in the raw / loose milk sector is strong. hospitals etc.720 2007 7. has two outlets in Jinja. This is further supported by the quantities imported as per data provided by the Department of statitistics in Entebbe. where the Kaisa Farm sells raw / loose milk. farmers¶ associations that are actively involved in supplying urban milk markets.994 2005 17.) Milk and Cream in solid forms = < 1.069 1. restaurants and other food outlets. Milk collected by milking agents and then sold to individuals or to retailers.) 500 600 300 200 500 Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 11 . Table 9 ± Substitute Products Substitutes Price per Unit Quantity per day Soda (280ml) 500 1 Fruit Juice (300ml) 200 3 Porridge (500ml) 300 1 Dry Tea (500ml) 100 2 Mineral Water (500ml) 500 1 Source: Kaisa Farm field survey September 2009 Amount (Ushs.

4 Marketing and distribution 1. the Kaisa Farm hopes to achieve a market share of about 15%.4 Competitive advantage y Competitive Forward ± Backward Linkage: The Kaisa Farm will have a competitive forward ± backward linkage (vertical integration). Pricing: The Kaisa Farm will offer more competitive prices to the retailers through a discount of Ushs. High Quality: The Kaisa Farm will be in control of production of its milk. In comparison most processors and vendors depend on purchasing of milk that is transported in unhygienic conditions. 20 for any purchase of 20 litres and above. Whereas with the exception of Jesa Dairy Farm all processors depend on purchasing milk.900 litres per day (about 6% market share) within the period of this business plan. Milking machines to be purchased will further guarantee that the milk received is of the best quality. right from the stage of feeding the animals (vertical integration). Per Unit. In the target market.1 Marketing & Communication The Kaisa Farm marketing strategy¶s sales objectives will be to attain the sale of Kaisa fresh milk of 4. the majority of milk consumers have access to milk in one form or another ± either processed or raw.3. y y y 1. the Kaisa Farm. as such there will be little room for developing primary demand (development of new markets). it might be interesting for the Kaisa Farm to further test the new small ¼ package in all its markets. 1. thereby making savings and so increasing its competitive strengths Planned/Synchronised milk production: Given that the price of milk is high during the dry season and low during the wet season. as the demand already exists. the Kaisa Farm will synchronise its production to initially have a constant production during all seasons and at a later stage have the highest production during the dry season. This will be possible by taking advantage of the higher margins enjoyed due to the forward and backward linkages. The Kaisa Farm will therefore concentrate on: Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 12 . This indicates that the majority of the interviewed are not ready to spend Ushs 500 or more on non-basic items. The vertical integration further will avoid the Kaisa Farm from having to buy most of the raw milk for its production. In the long run.4. feeding. This will enable the Kaisa Farm to maximise its profits by having its highest production when milk supply is low and prices are high thus competing favourably against other milk sellers / processors. In response to these findings indicating that price is a key determining factor for consumers and that substitute products such as soft drinks are likely to become more competitive in price. through its vertical integration will be able to control the whole p rocess from breeding. Overall strategy The stated objective of the marketing strategy will be achieved through first and foremost ensuring that the existing customers of Kaisa Fresh Milk are retained and secondly through stimulation of selective demand by acquiring new customers who currently buy other brands. milking and delivery of the final products to the consumers.KAISA FARM BUSINESS PLAN Three out of five of the common substitutes mentioned above are priced between 100 ± 300 Ushs.

however. where the retailers if they purchase more than 20 litres. 2% in the second year and 3% in the third year. and sold at a competitive price. In addition the marketing manager and/or the Managing Director. and 1 litre pouches. It is envisaged that this will send a message to the consumers that the Kaisa Farm Milk is of the same quality as the leading brand. price and customer service. where the consumer price shall be set at a level similar with Dairy Fresh Milk. listen to grievances/complaints etc. open new outlets. y Simplifying and improving on the buying process ± Milk will be delivered to the customers premises and conveniently packaged in ¼. Pricing program The price of the Kaisa Fresh Milk will be set to achieve four main objectives: y y y y Sales growth Earning an acceptable profit Gaining a competitive advantage Creating a positive consumer perception of quality and value for money At the point of entry into the market. In this regard the Kaisa Fresh Milk packaging will differentiate it from other brands. while at the same time increasing Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 13 . the leading brand on the market. In order to gain a competitive advantage. will be given a discount. can at times be interpreted as a reflection of lower quality. The total cost of the various marketing programs outlined below will be covered by a special allocation in the budget equal to 1% of the total sales in the first year. Acquisition of new customers through clearly differentiating Kaisa Fresh Milk from other brands in areas such as packaging. A lower price. where the Kaisa Fresh Milk was sold at a lower price than the major competitors in order to stimulate an increase in demand. the Kaisa Farm adopted a penetration -pricing strategy. a slightly lower price than Dairy Fresh Milk will be offered to the retailers who stock more than 20 litres a day. Kaisa Fresh milk will also be delivered very early in the morning preferably. as this increases the likely hood of the customers to stock Kaisa fresh milk when the milk stocks are low. Retention of current consumers through: y Maintaining satisfaction ± Due to the excellent feedback on its products as demonstrated in a survey the Kaisa Farm carried out. Following below are the programs to be implemented. Such perceptions of low quality should not be promoted as customers of the Kaisa Farm products were found to focus on quality. before any other processor/supplier. Marketing Programs Various marketing programs will be put in place to achieve/implement the market strategies outlined above. however. will carry out routine visits to potential customers promoting the Kaisa Fresh Milk. to enable various customers purchase what suits their consumption.KAISA FARM BUSINESS PLAN 1. It is anticipated that the above illustrated pricing will lead to increased sales growth. ½. The Kaisa Farm will therefore adopt parity pricing to the final consumer. such that the money they derive from the sale of Kaisa fresh milk will be higher than other brands. y Reducing attractiveness of or opportunities to switching ± This will be achieved mainly through a pricing strategy. 2. As such they would be encouraged to stock Kaisa Fresh Milk. Kaisa Farm will maintain the quality of the Kaisa Fresh milk and advertise an image of quality for its milk.

½. Advertising program The objectives of the advertising program will initially be: y y To increase awareness and/or brand name recognition of the Kaisa Farm Products by targeting currently serviced segments as well as new segments. The survey carried out by Kaisa Farm revealed that the awareness level of the Kaisa Fresh Milk was 27%. The pricing of the individual products (¼. Cares for the environment in its production. The Kaisa Farm thereby creates a strong incentive to the retailer to stock and promote Kaisa Farm Milk. As the consumers are focused on quality. The Kaisa Farm: y y Is committed and strives to produce competitively priced.g. under the strictest hygienic condition. is able to promote and control high quality form the breeding of the cows¶ right up until the consumer opens the pouch. the ¼ litre pouch will be priced at Ushs.: ³The Kaisa Farm is Quality ± The farm you can trust. the retailer is likely to make a higher profit selling the Kaisa Farm Milk. Ideas for slogans. Because of its vertically integrated mode of production. the ½ litre pouch that is also relatively expensive to package and market will be priced at Ushs.´ Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 14 . 650 to the retailer. To project an image of the Kaisa Farm as a producer of quality products. This means that the smaller pouches will be priced higher per litre than the bigger pouches. which could promote an image of quality and good price. to attract the consumers it wishes to target.KAISA FARM BUSINESS PLAN the product profitability and creatin g a positive consumer perception of the Kaisa Farm Products. 650. Has long and strong traditions and uses the latest technology with milk being produced on the farm. taste and price. 30 years of dairy farming has taught us to use only our own milk from the best breeds ± processed with the best equipment. fresh dairy products. In addition the Kaisa Farm must. On the open market (whole sale price). might be: ³The whole milk from Kaisa Farm ± a whole lot more ± for the same price´ OR ³So much more for the same price´. 680 and the 1 litre pouch that is less expensive to package will be priced at Ushs. This will be supported by information e. Can ensure that prices are kept low because of few middlemen. 700. which appeals to these consumers. Please note that Dairy Fresh Milk¶s current wholesale price is Ushs 700 per litre. create an image. By selling its 1 litre pouches at Ushs. the Kaisa Farm will work to create an image which projects the Kaisa Farm as a producer of well tasting quality products giving value for money. which are highly appreciated by the consumer. Such an image could be built around or on the following statements about the Kaisa Farm. and 1 litre pouches) will be set to reflect the cost of producing and marketing the products. high quality. y y y The Kaisa Farm next will create messages and slogans based on the above statements and select media to efficiently and effectively communicate these messages and slogans. During the time frame of this Business Plan the Kaisa Farm will aim to increase awareness and / or brand recognition of the Kaisa Farm Products from the current 27% to around 70 ± 80% in the target markets.

from when it was started up to today ± mentioning long experience. The importance of targeting children must therefore be emphasised. which target these important groups. the main reasons appear to be the low price and the possibility of taking the milk instantly ± as you go.KAISA FARM BUSINESS PLAN Provided there is room on the package the Kaisa Farm might include a short history of the farm. The Kaisa Farm will therefore use slogans that do not refer to one particular product (e. These consumers also seem to have the lowest average age. The above suggested image has been created to appeal to buyers of all the Kaisa Farm¶s products. that there exists some groups of consumers. marketing messages and design marketing materials. however. To them. The promoted quality image will be supported by a guarantee for a refund of money to the consumer in case the product does not meet the stated quality. it is estimated that 1. In addition during the first year. Moreover. by: 1. When creating slogans it should be taken into consider ation that the Kaisa Farm will also be selling cream and butter. The two objectives stated above are planned to be achieved as follows during the three years of this Business Plan: In the first year. The posters will be placed in appropriate locations like supermarkets. The ¼ litre pouches could be designed specifically for these take-it-as-you-go customers. Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 15 . kiosks and any outlet where the Kaisa Farm Milk is sold and stocked. Whole Milk). One marketing shilling spent on children may generate more income than if spent on an adult.000 posters will be used. the farm¶s vast green lush pastures etc. to increase awareness in the areas that the trucks reach. children grow up to be adults and can as such become lifelong consumers. Based on the potential market.g. The image of a hygienic production and attention to detail will be promoted by having all staff wearing clean uniforms with the company logo. 2. primarily posters and flyers. Liaising with a marketing agency to create slogans. the Kaisa Farm might include health tips ± targeted towards families and children -. It is estimated that a considerable number of people will view these posters. which may not fall directly within the above groups: y The consumers of the ¼ pack pouches seem to buy this product not only because of the low price and stability. This and the previous observation indicate that children are involved in the purchasing processes. It should be noted. Provided there is room on the package. y y The above points to the fact that the Kaisa Farm may wish to create special marketing initiatives. Special packages and posters will be created for children. children mainly consume it. rain proof posters and/or paintings of Kaisa Fresh Milk will be put on the delivery truck and the delivery bicycles. The Kaisa Farm envisages targeting younger consumers directly ± in schools and universities. Though adults often buy milk. grocery stores. as they are one of the main consumer groups.

It is anticipated that trial will lead to satisfaction with the Kaisa Fresh Milk. y To encourage inventory building by retailers within acceptable limits ± in order to reduce retailer stock-outs and thus maximise the availability of Kaisa Fresh Milk to consumers.000 and 200. Maintaining the advertisement on the delivery trucks 2. Replace torn posters at supermarkets. 4. During the third year. The purpose of this evaluation will be to get feedback on the advertising program enabling the Kaisa Farm to constantly improve its advertising efforts. 3. Carry out weekly classified advertisements in the New Vision. but who might try an alternative in Kaisa Fresh Milk and find it acceptable if the leading brand is not available. During the third year. These newspapers have respectively 400. Take up a monthly package for a total of four months (one month per quarter) with the Central Broadcasting Service Radio (CBS) which is most widely listened to radio in the target market. An advertising agency will therefore be hired to design appropriate messages and appropriate presentation on radio.000 number of readers per day. grocery stores etc. During the second year. The evaluation will be carried out in a way that allows the Kaisa Farm to obtain results per geographical area. Maintain the advertisement on the delivery truck 2. The evaluation results from the various geographical areas served will be compared to the sales statistics per geographical area. The Kaisa Farm will also have manufactured uniforms with the farm¶s logo printed on for use by its sales and delivery staff. Carry out weekly classified advertisements in the New Vision. however be taken ± in encouraging inventory building ± retailers will be chosen selectively among those who have enough facilities to store milk at 4 degrees centigrade in order to avoid sourage of milk. Promotion program The objective of the promotion program will be: y To encourage customer trial of the Kaisa Fresh Milk. Reducing stock-outs will enable retailers to avoid losing customers who otherwise would stick to Dairy Fresh Milk ± the market leader. Monitor and Bukedde News papers. therefore.KAISA FARM BUSINESS PLAN 3. leading to conversion from other milk brands or from product substitutes. The Kaisa Farm during the time frame of this Business Plan will be involved in three types of sales promotion namely: Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 16 . 220. Monitor and Bukedde News papers. At the end of each year the Kaisa Farm will carry out an evaluation of the advertising program interviewing consumers randomly in the target markets of their knowledge / perceptions of the Kaisa Farm Products. the Kaisa Farm will also have the objective of: y Targeting consumers to change beliefs about brands A good number of consumers develop buying habits and/or loyalty to certain mil k brands. besides the initial objective of increasing awareness and/or brand recognition. Replacing torn posters at the supermarkets. Caution will.000. 3. the Kaisa Farm will: 1. 4 daily 30 seconds spots during each of the four months. the Kaisa Farm will intensify its advertisement efforts by: 1. grocery stores etc.

pricing as the major brands ( in spite of higher quality).2 Sales and Distribution The objectives of the Sales and Distribution Program are to: y Promote a perception with the retailers and consumers of the Kaisa Farm Products as being always available. institutions and big work places (see year one point 2 for more detail). Offer free samples once every month in selected shops.KAISA FARM BUSINESS PLAN y y y Exhibiting and carrying out promotional sales during the June Dairy month. Schools are also visited and teachers and children are informed of the benefits of milk and free samples are given to the children. Land O¶ Lake Purchases processed milk like Kaisa Fresh Milk and distributes it for free to invited guests. Offer discount to retailers who stock 20 litres or more. The effect of the above initiatives should be captured by the yearly evaluations performed in connection to advertising program (see advertising program section).000 visitors among whom are retailers. 4. institutions and big work places. the products it offers and where they can be bought. 1. Exhibit during the June Dairy Month. Offer free samples once every month in selected shops. 3. heads of institutions etc. 5. Offer free samples once every month in selected shops. Exhibit during the June Dairy Month. Exhibit during the July National Agriculture and Trade Show. (see year one point 2 form more details). National Agriculture and trade show and the Uganda Manufacturers International Trade Show. The free samples shall be accompanied by a company flyer explaining about the Kaisa Farm. 3. During the third year. Exhibit during the July National Agriculture and Trade Show ± This is a yearly event at the source of the Nile in Jinja. solicit their opinion on the taste of the Kaisa Milk and assess whether they might be buying Kaisa Milk in the future. y Promoting a perception with the retailers and consumers of the Kaisa Farm delivery and sales staff as being knowledgeable about the products they sell. of good quality and competitively priced. During the first year. Information about the health benefits of consuming milk. 2.4. Exhibit during the June Dairy Month. its long traditions. This is a yearly event by Land O¶ Lakes aimed at creating awareness about the values of milk with a view to increasing milk and milk products consumption. unique production set-up (control of the whole process). if they have heard about Kaisa Farm before. Exhibit during the October Uganda Manufacturers Association International Trade Show ± This is the biggest yearly trade show in Uganda. institutions and big work places and briefly interview the consumers what they currently consume and how often. the Kaisa Farm will: 1. college students. Carrying out promotions among retailers where discounts will be given to encourage the retailers stock the Kaisa Fresh Milk. 4. 2. Offer discounts to retailers who stock 20 litres or more. Offer discount to retailers who stock 20 litres or more. During the exhibits. the Kaisa Farm will: 1. Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 17 . its commitment to quality. Offering free samples in targeted supermarkets. 2. school children etc. During the second year. grocery stores and institutions (such as schools and universities) and big work places. that attracts over 150.000 people. the Kaisa Farm will: 1. The show attracts about 75. Also future products. 3. fresh.

The Kaisa Farm will also deliver directly to institutions such as universities and schools and hotels among others.KAISA FARM BUSINESS PLAN y y Ensure that the major retail outlets / customers always have Kaisa Farm Products in stock. One group will be responsible for delivering the milk. In addition. The sales person will therefore not only become the Kaisa Farm representative to the customers but will also become the customer representative to Kaisa Farm where any needs. A questionnaire / form shall be prepared to monitor the quantitative aspects of the sales on a daily basis. to ensure that the milk is delivered quickly when it is still fresh. Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 18 . The sales staff will be responsible for obtaining the information required to complete these questionnaires. Iganga and Kampala markets. Considering the above. further stimulating competition among the staff and increasing sales. starting from about 7. Ensure that the Kaisa Farm Products always are well displayed and easily spotted. institutions. which will enable the farm to reveal positive / negative trends in the market. Deliveries will be made very early in the morning. These three staff will pay r egular visits to the current retail customers and establish and maintain a personal and effective relationship with the customers. storage. feed-back on customers¶ perception of the Kaisa Milk and marketing. such as: The retailers¶ perceptions of the reasons of low / high sales. A truck and/or bicycle will deliver to established retail outlets in all the target markets. problems encountered in the marketing / sales of the milk. these statistics will be used for comparing performance of the different sales personnel. therefore ensuring that the Kaisa Farm succeeds in having the retailers stock more of its milk. the sales staff. suggestions for improvement in delivery. In this regard the sales person will face the same buyer/customer over and over. sales. packaging. there is clear need for training the sales people in interpersonal skills and customer service. ensuring that the products are well displayed (eye catching). receiving feed-back from the retailers and customers. taste of the Kaisa Farm Products. A short distribution channel will be adopted.00 am. display. The Kaisa Farm will enter the sales figures into statistical software. which again will be used for awarding bonuses creating incentives for the sales personnel. The sales staff will aggregate these figures on a weekly basis and report back to the Kaisa Farm. negotiating with the retailers. The delivery person will record number of pouches delivered to the individual retailers / distribution points. Sales calls will also be made to potential customers. During the second year a refrigerated delivery truck will be purchased to deliver the milk. will be responsible for customer relations. pouches returned and total sales. if possible earlier than competing brands. and promoting the Kaisa Farm Products. The staff will be divided into two groups. while the other group. communication from the customer will be delivered to Kaisa Farm through the sales person. and become a major link between Kaisa Farm and its customers. and hotels by the sales people and regularly by the marketing manager or Managing Director to promote Kaisa Milk. Three people will initially be employed in the first year as sales staff for the Jinja. Another questionnaire shall be prepared to monitor the qualitative aspects of the sales.

y All sales personnel will undergo a rapid on the job training to equip themselves with the appropriate skills in salesmanship.295 litres/day by the end of this business plan period. The products are to be promoted in a limited number of markets. Jinja and Iganga. To process raw milk from the farm and sell the processed milk. The Marketing Manger will be responsible for all the sales and marketing functions. schools and colleges. The expansion and streamlining of the operations are necessary to reduce the operating unit cost.KAISA FARM BUSINESS PLAN During the first year of this Business Plan. The major objectives are: y To achieve the output of raw milk produced of 3. y The delivery staff (the drivers) delivering Kaisa Milk will in the market place report directly to the sales people. y The ³turn boy´ on the truck will directly be under the driver. The agent will be responsible for distribution of milk to consumers. The Jinja sales person will be expected to spend 70% of his/her time in the field making market visits.5 Production process & development Short Term Strategy ± Years 0-3 During the next three years. however. Staffing and Training y A senior Manager/Marketing Manager will actively handle the drive to retain the current customers and increase the customer base beginning first with the retail outlets such as supermarkets and grocery stores in Jinja and Iganga. in addition to selected institutions. but will also need to include Makerere University and some parts of Kampala to achieve its planned targets of 2700 litres per day. This will be achieved by an initial purchase of 100 high yielding milking cows (HYMC) in the first year to add to the existing stock. y y y Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 19 . 30% of his time will be devoted to making plans and administration. y The sales person in Jinja (the home market) will oversee activities of all the sales assistants who make bicycle deliveries to the retailers. An extra sales person will be employed for the Entebbe market in the third year. y Three sales people will be responsible for the Jinja.300 litres per day in the second year of operation. sourcing new clients as well as taking down consumer complaints. streamline and consolidate the operations of the farm centred around the production and marketing of the following products: Raw milk. Iganga and Kampala markets. Kaisa Farm wish to expand. he/she will be offered a discount to be agreed with management in order to entice him/her to stock Kaisa Milk. In addition an extra sales person will be employed to cover the Entebbe Market. Mid way through the fist year. to start up production of cream and butter and market these two by-products. will be intensified as well as in Kampala. Current efforts in the local markets. In the third year of operations. Kaisa Farm will need to increase its distribution efforts to fully cover the Kampala market. At a planned sales level of 3. which will ensu re a comfortable profit. the Kaisa Farm will concentrate its sales efforts within Jinja and Iganga.660 litres per day. processed milk. cream and butter. y An agent will be appointed for the Kampala market to reduce on the transportation costs and other overheads in the initial stages when the sales are low in Kampala. 1. the estimated sales are planned to be 3. customer service and interpersonal skills. To improve the farm operations as described below.

295 at the end of the three year period of this business plan and 2. It is assumed that the farm must expand to new markets and segments to continue to increase sales.Objective 1: Increasing the farm¶s herd size and quality will be achieved through a breeding program as descr ibed below: The main objectives of the reproductive health / breeding program for the Kaisa Farm are: y Every cow is to produce one calf per year so as to have an accelerated increase of the total number of animals. y Improve the physical structure of the animals. In order to accelerate the increase in number of high yield milking cows the Kaisa Farm will also purchase well structured local cows as recipient mothers for multiple ovary embryo transplanting. To undertake training of the employees¶ of the farm for purpose of increasing the efficiency of the employees and ensuring a smooth introduction of new technology ± as suggested in this business plan. To implement activities aimed at improving the internal and external environment on the farm. Half way through year three undertake a new market analysis to be completed 1-2 months before year four starts. To re-invest all profit from the farm ± in the farm during the first year of this business plan. This is envisaged achieved mainly by: Sub-Objective 1: Increasing the farm¶s herd size and quality through purchasing High yielding parent breeding cows in the first year for breeding through artificial insemination. The Kaisa Farm may also consider investing in/taking over other dairy producers to widen their reach and build the Kaisa Farm brand name. as suggested in this business plan. Sub. The purpose is to gauge the future demand for the Kaisa Farm products ± revising the current marketing strategy. Ad. To renovate the maize / feed mill. Sub-Objective 3: Purchasing a separator to produce cream and butter. Planned Activities Required Achieving Planned Objectives: Year 0-3 Below are listed activities in the production area which are deemed necessary to achieve the above mentioned planned objectives. As mentioned above the future farm operations will centre on the goals to: 1. In order to achieve the above. To start up production of cream and butter mid-year one. the farm will use artificial insemination from a variety of selected bulls as well as using semen from selected bulls from its own Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 20 . Sub-Objective 2: Increasing the farm¶s production of milk through applying dairy production best practices as described in this business plan and increasing the buying of raw milk from out-growers/external producers to achieve the target output. Achieve the production of milk on the farm of 3.KAISA FARM BUSINESS PLAN y y y y y y y y To implement changes in the organizational structure and the human resources management as suggested in this business plan. To improve the financial reporting as suggested in this business plan. To renovate and upscale the dairy plant. y Improve on the quality of the milk produced.

a baler. a bull will be introduced to service it.6 0. However. By the same date. Due to the difficulty in detecting heat among the heifers. to induce it to come on heat and be serviced thereafter. the Nakavule unit would be cleared to make room for making hay and growing maize. it is hoped that this will assist in accelerated production of High yielding cows.2 100 An ambitious programme for replanting the major pastures has been suggested. Table 10 Ingredients Maize Bran Wheat Bran Cotton Seed Cake Bone Meal Urea Premix Salt Total % of total 32.e. Cows will be served with semen from similar breeds. The feeding mix will be composed as indicated in table 11 below. An annual review as regards the bulls to be used will be made and if need be changes made. a trailer to: Till the soil.003 0. Investing in the first half of 2010 in a tractor. plant seeds and harvest the grasses and the crops. The farm also hopes to introduce reproduction throu gh embryo transfer technique.7 32.7 1. This will be accomplished by planting 40 acres of each unit every rainy season. the entire 233. artificial insemination will not be used on the heifers). 2. a bull will be kept for servicing the heifers (i.13 0. By 15th April 2014 the combined 280 acres of Namisambya and Naminage would have been planted with improved grasses including Rhodes grass. Three breeds of animals will be kept on the farm namely: Friesian.5 acres of Namasagali farm would have been planted with improved grasses including Rhodes grass. The improvement in the animals¶ nutrition will come partly from new and better types of grasses and crops to be grown on the farm¶s pastures (see below). in cases where the cow fails to come on heat three months after calving. No time schedule has been provided for the Nakavule unit. a harrow. The first part of planting program me will be finalized by 15th April 2010. it will not be serviced for 45 days even if it comes on heat. a planter. Ad.667 32. 1. partly through the buying and feeding mixtures preferably in the wet season for use in the dry season. Investing in the second half of 2010 in a hay barn for storage of the hay from the newly cultivated fields. a plough. Jersey and Ayrshire breeds. Sub-Objective 2: Increasing the production of milk will be achieved by: Improving the animal¶s nutrition. The bull will also be used in cases where a cow fails to conceive for two consecutive artificial insemination services. Finally. The animals are assumed to have a constant intake of feeding mixtures throughout the year. After a cow has calved. The grasses will be used to improve the fodder for the cows as jus t mentioned. an investigation by veterinary personnel will be carried out and if necessary the cow will be given hormonal treatment.KAISA FARM BUSINESS PLAN farms. Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 21 .

Naminage and Namisambya farm). which will improve the output from the fields and as a result the general fodder situation. responsible for backstopping all farm operations will visit the farm on a quarterly basis to hold management meetings with the Kaisa Farm management. The animals will be milked twice a day. Jackson Mubiru. Investing in the first half of 2010 in 47 kilometres of electrical fencing to be supplied by solar power. The dairy technician will spend a total of 3. Investing in the first half of 2010 in a manure spreader. y An expatriate experienced veterinarian will visit the farm twice during the three year period to assess the herd and the feed mixes. y An expatriate Dairy technician will visit the farm once during the first year and once during the second year. These investments will be supplemented in the second half of 2010 by construction of concrete manure pits and urine tanks at Naminage and Namisambya. 4.e. Electrical fencing is proven to be l ess damaging to cattle. The farm manager will to a great extent. The pieces of clothes will have to be replaced monthly depending on their durability. The construction of a better water distribution system for the cows will commence in the second half of 2010 . in the morning starting at 6. a urine sprayer and a front loader to: Collect and spread the manure. The animals will be collected 30 minutes prior to the milking time.00 am and in the evening starting at 5. Improving the farm operations as follows: Improving management ± training: y A qualified farm manager trained and highly experienced in animal production and husbandry will be hired. There is. be responsible for and carry out the training to be provided to the farm staff although Kaisa Farm will outsource extra know how for training as needed. Before the milking is done every animal will be checked for any traces of mastitis.00 pm. The new fence will replace the current barbed wire fencing. Investing in the first half of 2010 in the construction of a milking parlour for which a pipe milking machine. separator and equipment for making butter. The farm manager will be in charge of farming operations at operational and managerial levels. 7. the udders of the animals will be cleaned with a piece of cloth (one piece per animal) kept in a solution of chlorine for disinfecting.KAISA FARM BUSINESS PLAN 3. 8. Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 22 .5 months on the farm to facilitate the start-up of the production of cream and butter. 5. Milking: Milking will be done by milking machines on two of the farms (i. To ensure hygiene during milking time. will be procured in the second half of 2010 . Kaisa Farm will improve the distribution of water by laying down plastic pipes through which water will be pumped to water troughs at Naminage. Namisambya and Namasagali. y Dr. The milk will still be processed on the farm as the current plant easily can handle the increased volume. which can accommodate 40 high yielding cows at Naminage. Milk produced per animal will be recorded at every milking. 6. however need to carry out thorough renovations and a need to purchase a new packing machine.

Sick animals identification: The herds-men have daily contact with the animals. Tripanosmiosis treatment/control: As long as there is a threat of tripanosmiosis on the animals they will be covered with a curative drug (Berenil) and after three months they will be covered with a preventive drug (Samorin). to repeat the curative drug after six months.e.KAISA FARM BUSINESS PLAN The milking machines will be cleaned / disinfected with a solution of chlorine or any other available disinfectant and a strong commercial detergent. if it is found that this needs to be done regularly. However. preferably every last day of the month. Health Control: The health control program for the farms will mainly be comprised of: Spraying of animals: This will be done in the already established spray races. It will therefore be the responsibility of the veterinary assistant/doctor to advice the farm every year of what vaccinations if any that should be carried out. De-Hoofing: De-hoofing will be carried out as necessary on an individual cow basis. There will. where the rubbers will be removed and cleaned. Castration: All bull calves will be castrated and kept at Namasagali farm for a beginning as long as the total number allows this. but kept for breeding purposes as earlier mentioned or for sale to the National Animal Genetic Resource Centre & Data Bank (NAGRC & DB) in Entebbe. where these will on a daily basis remove pasture weeds i. These have to immediately be reported to management for either treatment or carrying out any preventive measures to the rest of the herd. the farm will freeze brand all animals. it will be carried out twice a year. The veterinary personnel will from time to time advise management as to the need to change the accaricide. be a selection of some bull calves that will not be castrated. using a solution of decatex or any other accaricide recommended by the veterinary staff. Castration will be carried out once every four months. Branding: For the purpose of identification and registration. A branding program with the oldest animal branded no. To be later kept in Nakavule for fattening and later sold off for beef. Pasture Maintenance: A permanent work force will be established to carry out pasture maintenance. it is important to ensure that every animal goes through the spray race. Freeze branding will be done once every four months. however. It will be the responsibility of the farm manager to oversee and provide proper training for milking. Vaccinations: Vaccinations will be carried out depending on the disease threat in the area/neighbouring districts. 1 and the youngest having the ³highest´ number will be adopted. grasses/shrubs Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 23 . as such an inventory of all animals will be carried out at every time of spraying. At the time of spraying. De-worming: The Adult herd will be de-wormed once every four months and the calves will be de-wormed every month. The milking machines will further be given a thorough cleaning once a month. The farm manager will further ensure proper maintenance of the milking machines and ensure that proper milking procedures are kept and proper milking environment is provided for the animals and that these skills are passed on to the farm workers. This will be carried out once every four months. Before being branded the calves will be identified by piercing the ears following punch numbers for each spot. De-Horning: In order to avoid the animals from causing injury to each other all heifer calves will be de-horned. The spraying will take place once a week during the dry season and every fourth day during the wet season. they will therefore be trained and have the responsibility of looking out for signs/symptoms of any sick animals.

Sub-Objective 3: Purchasing a separator to produce cream and butter will be achieved by: y Purchasing a second-hand separator for cream and butter in by the end of the 1 st half of 2010. further increase the sales of cream and butter. Selected staff of the dairy plant will be trained by the dairy technician to allow for commercial production by the start during the second half of 2010 . The advantage is that when demand is low. This way. y Miscellaneous: Working conditions influence operations. Kaisa Farm during the next three year period wishes to: Depending on the new marketing strategy (see short term-strategy for years 0-3) further increase the production and processing of milk on the farm aiming for a raw milk output of 6. y Half way through year six undertake a new market analysis to completed 1-2 months before year seven starts. the Kaisa Farm will create a supply buffer. The Kaisa Farm plans to invest in the construction of new staff housing during 2011 and in other working environment friendly minor initiatives in the first half of 2010 . y The Namasagali farm unit may be opened up to accommodate 200 cows for milking. equipment will need to be purchased for cutting overgrown grasses. y The Kaisa Farm during this time frame will continue to use reliable quality conscious out-growers for an approximate 10-20% of its milk supply. In the future. Ad. Culling: Regular culling will be carried out in accordance with established targets of the Kaisa Farm. the farm will not waste its own milk but instead reduce the intake from out-growers. Medium Term Strategy ± Years 4-6 Assuming the objectives for the first period have been achieved. y Depending on the new marketing strategy. Kaisa Farm may also consider investing in/taking over other dairy producers to widen its reach and build the Kaisa Farm Brand name. This will be achieved by: y A steady increase in the number of High yielding milking cows and further increase in yield. y Start Yoghurt production in year 5 y Test production of ice cream in year 6. Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 24 . y Human resource management will continue to be strengthened as will financial reporting systems and administrative functions. This will require further training of personnel.500 litres per day in year 6.KAISA FARM BUSINESS PLAN that are not eaten by the cows. The purpose is to gauge the future demand for the Kaisa Farm products ± revising the current market strategy. It is assumed that the farm must expand to new markets and segments to continue to increase its sales.

1 Management The Kaisa Farm Board of Directors are: Mr. Mr. Mr. Kaisa Mr. Joseph Kaisa After graduating from Makerere University with a bachelors degree in social sciences (social administration and political science). Mr. By combining the farm¶s and the out-growers efforts. Joseph Kaisa is the vice chairman Board of Directors and the Managing Director. Joseph Kaisa assisted with the general management of the Kaisa Farm and day to day operations before proceeding to the USA for his MBA studies. He is also a business management systems adviser with the International Trade Centre (ITC). Joseph Kaisa has served as the Chairman Board of Directors of the National Animal Genetic Resour ces Centre and Data Bank (NAGRC & DB) an organization that is responsible for the improvement of livestock in Uganda through animal breeding and regulation of importation of livestock and genetic material. 1. Kamuli District.6. Positions he has held include General Manager. B. In the USA he held various management positions first as finance manager and later as operations manager with the North America Association of Christians in Social Work. The use of milk from out-growers should be limited to out-growers. S. B. USA. where he trains Entrepreneurship and Finance for Non-Finance Managers.6 Company structure 1. Kaisa is also a member of the executive committee of the Eastern African Association of Dairy Stakeholders (EADAS). the farm wishes to increase its purchasing of milk from outgrowers. Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 25 . Kamuli District and Chairman animal breeding association. Namulesa Coffee Factory.KAISA FARM BUSINESS PLAN Long Term Strategy ± Years 7-10 Assuming that the medium term objectives have been achieved. Joseph Kaisa is also a resource person with Enterprise Uganda. This will be achieved by: y A steady increase in the number of High yielding milking cows . y Moreover. He also worked as a consultant for the Global Partners Investments based in Pennsylvania. the Kaisa Farm during the next four years may consider to: Depending on the new marketing strategy (see medium term ± strategy for years 3 ± 6 above) further increase the production and processing of milk on the farm. Kaisa is the Chairman Board of Directors. a further increase in their yield and an improvement in the quality of milk produced. Animal Industry and fisheries. S. y A possible acquisition of neighbouring farms bordering the Naminage and Namisambya units or acquisition of farm units closer to the Kaisa Farm main markets to reduce transport costs. including the 3 rd prize in dairy competitions of the Ministr y of Agriculture. Chairman Land Commission. S.000 litres/day in year 10. Mr. B. Mr. member of National Animal Breeding Policy task force committee. Member of the Board of Directors of then Uganda Commercial Bank. member of the governing council of the Church of Uganda province. the farm hopes to reach a raw milk base of 12. Mr. Mr. who are quality conscious as the Kaisa Farm so as to safeguard the Kaisa Farm¶s relatively high product quality ± around which its marketing efforts are centred. Kaisa has over 30 years experience in the dairy and poultry business. He has won several prizes in the dairy and poultry farming.

it will necessitate to recruit additional staff and training of the current and new staff. assume responsibility for establishing clear targets for their individual area. In order for the staff to perform fully.KAISA FARM BUSINESS PLAN Other company Directors are: Mrs. Siraje Katuntu and Mr. in consultation with the Managing Director.K Kisenyi ± Member Mrs. y y y y y y It is expected that the above will improve the efficiency on the Kaisa Farm. accurate and easily measurable targets. In view of the planned future expansion of the production and sales at the Kaisa Farm. he is trained in forage management and animal husbandry. The middle managers would. the desired candidate will have experience in animal production and dairy processing. Keep attendance records ± and pay staff according to the days they report to work. Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 26 . B. it will be necessary to specify what exactly each staff member is expected to do and ensure that they are aware of this. Kaisa ± Treasurer Dr. Joshua Biko. E. In the organizational plan. Katuntu is a trained artificial inseminator and Para-Vet. managing their own area. Have the remuneration reflect: the complexity of the job / current market price for the job ± adjusted for the employees¶ current level of skills. Mr. Mr. Dr. Grace Kaisa ± Member Management Mr. production and sales. The company is in the process of recruiting a farm manager. S. Review all employees¶ skills against their job descriptions and ensure that all staff have either adequate skills or will be trained. Jackson Mubiru. Kaisa and Mr. Have contracts for all staff to which the job description would be attached specifying the conditions o f service and. Katuntu has one of the best records in artificial insemination with non repeat service of about 80%. M. Joseph Kaisa above are directly involved in the management of the company. B. Other key people involved with the day to day operations are Mr. Keep a roster for the various staff categories ± to ensure that the farm can always quickly recruit replacements for non-performing staff. Dorothy Nuwamanya ± Member Dr. Mr. The Kaisa Farm also hopes to further increase efficiency by improving on the working conditions for the middle-managers by the construction of staff housing on the farm. it is required to: y Prepare job descriptions for all employees which clearly define each employee: -Responsibilities -Duties -Daily activities -Daily or monthly targets These job descriptions will be kept short ± with simple. Therefore. The Kaisa Farm has therefore reviewed / formalized its organisational structure. the consequences in case of non-performance. importantly. Clearly define who reports what to whom and when. related activities have been clustered and middle -managers have been inserted to be responsible for individual areas such as finances. a veterinary doctor and a specialist in assisted reproductive technologies and animal breeding provides technical backstopping on all operations of the farm. monitor progress and report to the Managing Director. Biko is a supervisor on the farm.

Training program A training program has been designed for the Kaisa farm in line with the current / future technology and work processed to be applied on the Kaisa Farm. The inv olvement of the employee in the planning process will ideally create greater commitment to the farm¶s overall goals or at least the employee¶s own goals. The performance evaluation system will also allow for discussing the employee¶s career aspirations. which would create additional incentives for the employees and might enable the management on the farm to identify staff that aspires for higher positions in the future. based on a rolling strategy planning. has formed the basis for the training model. objectives and concrete activities derived from the Farms mission statement. and how to achieve them. the employer would review the employee¶s performance with the employee to detect under or over compliance. At least twice a year. This will allow the manager to constantly adjust the work areas of the individual employees to ensure that work is accomplished according to the targets set ± and possibly adjusting salary to ensure that the incentive structure is fair.KAISA FARM BUSINESS PLAN Once the above improvements have been implemented and are working satisfactorily the Kaisa Farm will establish a simple performance evaluation system. Through a farm wide negotiation process staff will be involved in setting targets for the farm (ideally) and for their own work areas (more realistic in this case). At a yearly negotiation the employee to the extent possible will set his/her own targets for the next year / each month. where there is a supervisor who supervises the daily operations. and thereby enable the Kaisa Farm to maximize the operational output of the investments. Training assumptions Kaisa Farm¶s present organizational structure. The present level of training of the farm staff is not adequate to achieve the goals and values of the Kaisa Farm. The employee¶s job description would be revised to reflect the change in responsibilities. from top to bottom. Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 27 . Another positive outcome of the performance appraisal system will be that it will force management to regularly set targets for the organization including management itself. The remuneration will initially be set according to the level of work that the employee has committed him/herself to complete. Training objective The training objective for the staff at the Kaisa Farm is to improve the skills of the individual staff member in his/her function. is focused in its undertakings. if any. A performance management system is basically a tool that will seek to ensure that all employees agree to pull the Kaisa Farm in the right direction by: y y y y Ensuring that the farm always has updated objectives and strategies Increasing the involvement of all staff as they negotiate and agree on their job descriptions and output targets (derived from the farm¶s objectives) Implementing an incentive structure to support these efforts ± monetary and career wise Improving the planning and monitoring by regu larly reviewing in detail each employee¶s performance A performance evaluation system will take its point of departure in the strategies. It also will force management to regularly review the staff¶s skills and training requirements. making it more likely that the Farm.

how the milk is handled ± to make them fully acquainted with the product they are promoting and its delicacy. However. This part of the training will be reviewed periodically and the Farm Manager together with the Managing Director will work out and update the training plans continuously based on the reviews with 3 -4 months intervals. to ensure that the product the consumer drinks is always fresh. External training will mainly be for the Managing Director in an established training programme to be sourced. y y Cattle-management training and Field-management training Cattle management training The following areas will be covered during the practi cal ³on-the-job´ cattle-management training (see table below).g. as it will be implemented continuously during the three year period of this business plan. On-the-job training will be by far the largest input. This will enable them to better handle the milk ± and they would be better able at instructing the retailers on correct storing of milk. to be implemented by the Farm Manager to be recruited External training to be implemented in another country ± (African or abroad) The training considered for the Kaisa Farm is primarily meant for the production staff at the farm. On-the-job training will consist of two major parts. on-the-job training of various staff members in their functions will be concentrated on the management and foremen levels to ensure that further training of staff is implemented by these individuals. Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 28 . The sales personnel would also be better equipped for answering questions and for projecting the quality image the Kaisa Farm seeks to promote. The sales staff (especially the sales / marketing manager) will also participate in some of the training ± e.KAISA FARM BUSINESS PLAN In general the training will be designed as follows: y y On-the-job training. It is assumed that the qualification of the Farm Manager will strengthen the applied structure of the on-the-job training. for the dairy plant ± on hygiene. However. Training of the foremen in the two separate sections of the milking parlour and fields is considered important and will therefore be included in the detai led training plan. training of the assistant farm manager in skills in animal and field farm management is required.

Accommodation of calves. Health Management 4. y Feed hygiene control. y Heat control. hygiene in the cow boxes. Milking hygiene. Ventilation in the barn. y Calving and breed control. Cattle Reproduction Management 3. y Feed intake control. Daily routines in the barn. y Type of service personnel. Feed supplements and course of feed. Climate. mastitis control. y Treatment of animals. y Farmers¶ yield control. y Disease problems in calves.KAISA FARM BUSINESS PLAN Area for training 1. Feeding with raw milk. y Cattle replacement management. y Livestock building hygiene. Milking machine and milking tank management. One-day feed control exercise. Livestock building management 8. Working environment training. y Tail injury / necroses. Procedures for inspecting the milking plant. Calves Management y y y y y y y y y y y y y The above practical training will be implemented continuously during the 36 month of this Business plan. All levels of staff at the farm will be covered. Disease Management What is to be covered y Quality and composition of animal feeds. y Hygiene in connection with calving. bronchial infection. y Monitoring heat. Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 29 . Production Control 7. Hygiene of calves. y Disease in the udders. grass tetany and fat lever. y Budgeting animal feeds. Milking Management 6. y Diarrhoea. Drinking control / water. y Controlling gestation . Periodic feed control measures. 5. Cattle Feed and Fodder Control 2. Cattle nursing and care taking. including calving fever ketose. y Metabolic diseases in cows. Recording the milk production . y Digestive diseases due to wrong feeding. y Other animals in livestock building. y y y y Milking techniques. y Purchase / selling of animals.

y The stomach¶s feed requirements. y Purchase of animals. y Diseases of the udders. y Heat cycle. y Heat control and gestation percentage. y Complete feed analysis. y Recording the milk production . there will be no time limits involved in this type of training. y Other animals in the livestock building. y Limbs and hooves. y Replacement percentage. y Hormone system. Consequently. 10. y Livestock building hygiene. Breeding Strategies 13. This training will cover the following areas. y Breeding Strategy. Records Management and Registration What is to be covered y Registration of the herd. allocation of feeds. y Intestinal parasites / mastitis y General disease problems in calves. y Factors determining the feed for dairy cattle. y Diseases of the skin. y Recording health and diseases. y Observing heat. y Recommended max. The other part of the cattle-management training will constitute a theoretical ³on-thejob´ training. y Service personnel. y Selecting the bulls. which must be repeated continuously until they are a part of the staff¶s way of working. y Digestive diseases in cows. y Cost control and planning. y Feed budgets and feed systems. Health and Diseases Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 30 . y Quality and composition of feeds. Area for Training 9. y Tail injury / necroses. y Minerals and Vitamins. Feed Management 11. y Planning and insemination. y Infectious diseases. Reproductive Techniques 12. y Registration of the feed composition. y Reproductive organs. y Metabolic diseases in cows.KAISA FARM BUSINESS PLAN The above trainings are basically routines. y Immunity and immunity status. y Registration of the breeding and insemination. y Bronchial infection. y Treatment of animals. y Hygiene in connection with calving. y Protection against infections. y Feed rations.

Load factors. Raw milk. Organic fertilizers. Preparing and sowing place. Field-Management Training The following areas will be covered during the practical ³on-the-job´ field-management training. Gross proceeds. Fertilizer planning. Book depreciation. The total number of people who will be trained is approximately 10. Feed control. Calves Milking techniques. Disease and Pest Control y y y y y y is to be covered Seed change and management.KAISA FARM BUSINESS PLAN 14. Animal environment. Results from farming. The theoretical training will be implemented at foreman level. Classification. Feed supplements and course feeds. Waste and products from 22. Contribution margin. Unit costs. Goal for re-production. Milking hygiene. Fungi. Soil Treatment 23. Bacterial control and counting. Bacteria. Trade fertilizers. Meat Production 18. Result of capital payback and shareholders return. Planting Protection 25. Sowing depth. Harvesting Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 31 . Economy y y y y y y y y y y y y y y y y y y y y y y y y y 19. The duration of each section of the theoretical training is estimated approximately three weeks. Milking Management 15. Pest and germ control. Distribution methods. Milk and beef production. Arrangement of cattle-houses. Viruses and deficiency diseases. Climate and watering. Financial costs. Area for Training 20. Cell counting. Production Control 16. Feed control. Levels of ripeness. Sowing methods. The use of commodities for planting protection. Milk recording. Choosing the crops 21. Water and drinking. Livestock Building 17. The use and adjustment of the field spraying. Animal handling and management. Hygiene and calves¶ housing. The theoretical training will commence beginning of 2010 . Fertilising What y y y y y y y y y y y 24.

Means of cohesion. Pest. Germination. Type of Crops What y y y y y y y y y y y y y y y y y y y y y y y y y y y y is to be covered Climate. Through practical education on-site. Organic fertilisers. Storing plant-protection commodities. Safety of machines. Protective means and dosing. Fertilisers. Soil treatment.protection 33. This will cover the following areas. Water content. Fungi. Reaction numbers. Soil types 32. Vegetation and Flora 27. including systematic treatment. The above practical training will be implemented continuously during the 3 6 months of this Business Plan. Bacteria. Treatment of leaves. 30. Area for Training 29. phosphorus and calcium count. Type of crops. All levels of staff at the farm will be covered. The other part of the field-management training will constitute a theoretical ³on-the-job´ training. Types of soils. Selective means / non ± selective means. Sowing bed. Germination. Means of plant . Watering options. Poisoning of humans and animals. Diseases and pest control y y y Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 32 . The Crop¶s need for fertilisers 31. Techniques for taking notes 28. Storing and treatment of the field after harvesting. Damage to crops. Climatic conditions. Through practical education on -site. Contribution to profitability. Texture analysis. Expected yield from fertilisation.KAISA FARM BUSINESS PLAN y y y 26. Change in seed and grain planning. Treatment of soil. Maintenance of machines. Sowing and sowing methods. Green fields ± disease from change of seed and grain. Soil types. Pollution from out-washing and dewatering. Driving techniques. Machines y y y y y harvesting. Rainfall patterns and pre-ripping.

Accidents and Machines What y y y y y y y y y y y y y y y is to be covered Power and transmission exchange. Field-leaves for fodder sale. Ecological planting and cultivation. Water balance account and water accounting. Harvest 35.KAISA FARM BUSINESS PLAN 34. Artificial fertilising. Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 33 . Products for treatment of diseases. Falling Accidents 42. Macro/micro fertilisers. Stairs and ladders. Weight of dry matter. Practical education on site. In addition to the above training. Accidents involving animals 39. Noise 41. Soil treatment. Seed change planning. y y y y y y y y y y y y y y y y y y Virus diseases. Covering chains and straps. and procedures to ensure a good w orking environment will be undertaking. Weed control and round-up. Planting and cultivation. Driving safety. Dust Control 40. special training tailored for the purpose of training in safety procedures. Area to be Trained 37. Air humidity. Timing and planning the treatment. Notes and Records Management. The following areas will be covered. Children and other traffic. Field-leaves for fodder-crops. where necessary expertise will be out-sourced to conduct the training. Noise from machines and tractors. Manuring and soil-structure. Level of ripeness. Storage density. Noise control. Jackson Mubiru responsible for backstopping all farm activities will also play an active role in the training. Lifting and Pushing Techniques The farm manager will be responsible for the overall training and the sourcing of the training materials/content. Mechanical milking of animals. Conditions for production. The time schedule for the field-management training will be the same as for cattle management training as described above. Coupling de-coupling machines. 38. Ecological Farming 36. Removing animals. Safety training and training in Good working practice and Environment. Dr. Hand-railing. Field covering and control. Fertiliser planning.

a barn. milking parlours. The Kaisa Farm will also closely monitor the developments related to the production and sales. These are indicated in table below Key issues Potential / actual negative impacts Pollution of nearby bore hole Pollution of the soil. To ensure a successful and timely implementation of these numerous activities will require careful work and financial planning as well as minute monitoring. soft hooves and soil on the udder Mitigation measures implemented to be Objectively verifiable indicators Bacteria in analysis samples Cleaner and healthier cows and better milk quality. two urine tanks and two storage areas for manure . updating the financial schedules. These sales are pivotal in maintaining a healthy bottom line. planting of new pastures and harvesting which requires training. Water holes to be supplied by pumps through pipes from distant water source Tests of ground water immediately below ± before and after construction Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 34 . Fertiliser spread on the fields Waste water from the dairy Waste water.KAISA FARM BUSINESS PLAN 1.one set at each milking parlour. related activities and assign responsibilities and state deadlines. Special attention will need to be paid to the third year when the target market will need to be moved aggressively to absorb the quantities of milk that are going to be supplied by the farm. constantly analysing the reasons for deviations and recommending remedial actions in case of negative developments. Also. construction of fencing. installation of new milking machines. manure pits and urine tanks. Without them the business plan as presented will be hampered. The Kaisa Farm will at an early stage develop a work plan format which includes all outputs within a production year. Spreading of urine / waste water and manure by use of respectively a urine spreader and a manure spreader mounted on a front loader and pulled by a tractor Construct more water holes for the herd on three of the farm units. In addition the staff need s to learn how to become more productive and to use the correct techniques in caring for the herd. marketing efforts will need to focus on moving cream and butter sales. The K aisa Farm on a monthly basis will compare actual developments with the projections made.7 Risks The Kaisa Farm¶s greatest risk lies in the area of achieving the targeted productivity of its cows and its farm labourers. Other risks related to scheduling of the implementation of the various activities needed to achieve the planned objectives for year one. manure and urine from the milking parlour Manure and urine concentrated around water hole Pollution of ground water Analyze the water for organic and inorganic pollution in the short term Construction of two concrete collection areas for the cows. There are also environmental risks (external and internal) due to expanded production which have been analyzed and mitigation measures put in place. The Kaisa Farm must also be certain to expand its markets as forecast. Care must be taken to ensure good genetic animals are purchased right from the beginning and that the cows receive a sufficient and steady supply of good food and water. clearing land. These activities involve procurement of Livestock and equipment. Quite a number of activities have been scheduled for execution during the first year.

Will improve the ability to easily and swiftly remove the manure and urine in the parlour.e.8 SWOT analysis STRENGTHS y Experience in the dairy sector y Arable and large acreage of land y competitive forward and Back ward linkage OPPORTUNITIES y Growing economy y Increasing demand of milk y Appropriate climate for milk production y Relatively stable country ± politically and economically and Friendly government policies encouraging investment in dairy sector y Name recognition and consumer satisfaction with Kaisa Farm products in primary market y Availability of specialized human WEAKNESSES y Few trained personnel y Poor production equipment THREATS y Strong and versatile competition y Relatively long distance from market y Fluctuating demand for milk ± (i. Contamination of the milk due to inadequate hygiene Use of plastic jerry cans which cannot be properly cleaned Ceiling to ground polyethylene flap doors for the in ± and outlet of the spray race. The current fencing requires too much wire and too many poles. Gloves and gum boots for the staff. Construction of 4 houses for main supervisors on each of the farms.KAISA FARM BUSINESS PLAN Pasture fencing Chemicals from the spraying race The barbed wires give wounds on the animals. Interviews with the workers ± before and after Test of the milk quality (bacteria) Easier to recruit and retain qualified management staff Out . manure / urine inside the milking parlour Working environment related: The carrying of milk is potentially strenuous to the staff The manure and urine create unhygienic working conditions General working environment Hygiene in production Distance of work Inadequate housing / long transport (65 km from the Kaisa Farm to Jinja) deters qualified staff from working on the farm. Will also improve on the hygiene in relation to the handling / storing of the milk in the parlour. Electric wire fencing powered by solar energy Lesser wounds on the animals and lesser use of wire and poles Interviews with the workers ± before and after Surface soil tests Carrying of milk in the main milking parlour.growers The Kaisa Farm to rent or sell Stainless milk churns to the out growers Better milk quality (tests) 1. high during dry and low during wet season) y Perishability of the product Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 35 . Spreading of the chemical waste from the race over a huge area by using the urine spreader. with pump / pipe milking machine to avoid the staff to carry the milk. Construction of new milking parlour at Naminage. The spray chemicals present a health hazard to the staff and may pollute the soil.

299 69.713 10.000 33.) Concrete Cow yard (Nbya) Milk pipelines and pump (Nbya) Milking machines (Nbya) Dairy plant renovations Drinking water for cows Nge water piping and pump Nbya water piping Ngali water piping and pump Distribution Equipment Truck 3-ton.218 22.874 16.989 13.954 2.9 Investment Plan A .138 1. refrigerated Fences Fencing Nge/Nbya/Ngali w solar gens Housing Housing ± Manager Housing .494 46.069 6.KAISA FARM BUSINESS PLAN resources ± production reproduction experts and 1.505 4.138 10.506 4.253 Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 36 .000 16.500 37.586 298 40.898 73.500 17.345 8.713 6.506 23.Finance needed Fixed assets by area of improvement : Livestock Breeding cows Equipment Milking facilities and equipment Improve parlour Concrete cow yard.195 11.759 50.Staff Pasture: Equipment.989 13.483 4. (Nge. seeds and storage Baler Harrow Planter Plough Sprayer Tractor Trailer Seeds Barn Hay storage Waste Management ± facilities & Equipment Front loader Manure Spreader Urine sprayer Concrete Manure pit ± Nge Concrete Manure pit ± Nbya Amount (USD) 109.000 4.

buildings and some limited equipment. Mr. equity. He is engaged in farming out of personal belief that this is his contribution to the development of Uganda.1 Personal motivation & individual qualities For the majority of his work experience. He is highly motivated and self driven.3 Personal role Mr. He has travelled and visited various dairy enterprises in the region which in addition to the above has tremendously prepared him to build up a successful dairy enterprise. a government agency responsible for development of livestock in the country. USA. 2.443 into the farm. USD 40. Given the vast natural resources in the country.062.000 as own contribution and the balance will be raised from reinvestments of the company income. It hopes to raise USD 400.000 TOTAL INVESTMENT still NEEDED (USD): 702. 2.Nbya Working capital: Working Capital ± Purchase Animal Feeds & Milk 1. He is also an executive member of the East Africa Association of Dairy Stakeholders. He believes that Africa in general and Uganda in particular will never develop. Uganda. The majority of which went into purchase of land. specifically dairy. Kaisa is a graduate of Makerere University.000 for working capital from a loan.506 747 Amount (USD) 40. He also has a Masters degree in Business Administration ± Economic Development from Eastern College.2 Experience Mr. His work experience spreads across 20 years working in Agribusiness. poultry and commercial maize growing.000 from equity. Mr. THE ENTREPRENEUR 2. Kaisa would like to set up one of Uganda¶s most productive and efficient dairy enterprise. Kaisa has excellent team building and interpersonal skills. own contributions and retained earnings/reinvestment of profits. 2. USD 20. He has carried out various short trainings in dairy production and processing. until people can meet their basic needs especially in terms of feeding themselves. Where he obtained a Bachelor of social science degree in social administration and political science. Kaisa has been in private Agribusiness having grown up on a farm. the employees and the local community. Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 37 . Kaisa as managing director ± will be the main driving force of in the execution of the business plan for the Kaisa Farm.KAISA FARM BUSINESS PLAN Urine tank ± Nge Urine tank . Over the next three years therefore Mr. Mr.170 The above stated capital is expected to be raised through a combination of debt. Kaisa Farm has to date invested USD 1. Kaisa believes that he can positively contribute to the sustainable development of his local community and make a contribution to the overall economic development of Uganda while earning good profit for himself and other shareholders. utilising leading and appropriate dairy practices so that the highest market returns will reward the farm shareholders. Pennsylvania. Kampala. Jackson Mubiru who will back stop most of the activities on the farm. He has served as a Board Chairman of the National Animal Genetics Resource Centre and Data bank. The farm does not have any current outstanding loans. He however has set up strategic alliances with an expert in dairy production and reproduction Dr.

4 References Dr.co. O. Charles Ocici Executive Director Enterprise Uganda P.com Office Tel: +256-414-320563 Mobile Tel: +256-772-594923 Mr. Mwanja Commissioner Ministry of Agriculture Animal Industry and Fisheries P. Box 4 Entebbe Email: wwmwanja@yahoo. O. 1966 Place of Birth: Namisambya Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 38 . Box 24581 Kampala Email: ocici@enterprise.KAISA FARM BUSINESS PLAN 2.ug Office Tel: +256-312-261900 Mobile Tel: +256-772-699808 Personal details for Joseph Kaisa Passport number: B0635143 Nationality: Ugandan Date of Birth: March 17.

1 Budgeting Sheet Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 39 .KAISA FARM BUSINESS PLAN 3. THE FINANCIAL PLAN 3.

KAISA FARM BUSINESS PLAN 3.2 Fixed Asset Purchases (P.T.O) Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 40 .

KAISA FARM BUSINESS PLAN Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 41 .

KAISA FARM BUSINESS PLAN 3.3 Cash Flows Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 42 .

KAISA FARM BUSINESS PLAN 3.4 Profit and Loss Statement Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 43 .

5 Balance Sheet Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 44 .KAISA FARM BUSINESS PLAN 3.

A positive environmental initiative is the collection of manure from the milking cows for use as fertiliser on the fields. urine tanks. In addition. the project will increase the use of raw materials / inputs. The milking machines and the dairy plant. iron. The supplying of still higher quantities of milk to the local market as well as the cultivation of the fields will require an increased use of transport and petrol / diesel ± a non ± renewable resource.1 Economic Impact Impact on Employment: Over the three years the employment on the Kaisa Farm is projected to increase by 36 staff. To increase the consumption of milk in the country it is theref ore essential to Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 45 . however. More packing material will be needed for the processed milk. manure pits. they are common in this kind of production. The Kaisa Farm through this business plan is likely to increase both the quantity and the quality of consumed milk in Uganda. staff housing) will temporarily necessitate an increased use of various raw materials ± cement. in the production and in sales. the various construction projects (milking parlour. the consumption of milk in Uganda is far below WHO¶s recommended levels. concrete cow yards. The various construction projects (hay barn. bricks. to be carried out by external contractors. will consume more electricity. 4. Electricity. will create extra employment in the construction industry as well as in the industries supplying them with materials. however. As mentioned in the market analysis. The increased requirement for material / inputs. milking parlour. With increases in the production. the Kaisa Farm will also have positive social impact described below: Impact on Health: Milk is highly recommended for consumption due to its positive health impacts. The consumption of water will increase significantly. Water«. can be described as reasonable seen from perspective: They are indispensable to the implementation of the project. processing and selling of milk and the cultivation of fields there will be a continuing increase in the consumption of the various inputs required to sustain these activities. Impact on the consumption of Raw materials. Overall. they cannot easily be replaced or reduced.KAISA FARM BUSINESS PLAN 4. THE DEVELOPMENT IMPACT This section includes information on the Kaisa Farms impact on the economic and social development of Uganda. Quantity A major part of the reason for the low consumption of milk is the low income levels in the country.2 Local social impact of the business¶s products or services Besides the economic impact described above. 4. including the storage fridge. and staff housing).

First by increasing the supply of milk. according to the Kaisa Farm¶s mission statement. this should be very feasible. Impact on Technical Capacity The Kaisa Farm business plan includes a significant component of training to be provided through a strategic alliance with a specialist in livestock production. This can be achieved by stimulating the competition in the sector forcing the producers to lower their prices. To avoid these consumers from falling sick from drinking the raw milk. Quality Raw milk needs to be boiled before consumption. The business plan has shown that there is room for additional improvement in the handling and processing of the milk and the Kaisa Farm is committed to carrying out such improvements. it is likely that not all consumers of raw milk actually do boil the milk. the farm¶s objective is exactly to lower the price of milk through more efficient production and lower unit cost. however. the effects of the capacity building will gradually seep out into still wider parts of the Ugandan ag ricultural sector. field management and safety. Confidential & Copyrights © 2009 ± Request permission to share or copy from the author 46 . Secondly by stimulating an efficient production on the Kaisa Farm. The Kaisa Farm will also benefit the local community through production of quality processed milk. In the long term. The training provided by the specialist falls within the areas of cattle management. The Kaisa Farm is stimulating the competition in the sector in two ways. With the technical assistance from the strategic alliance with an expert. This initiative will build the Kaisa Farm¶s professional capacity and benefit the farm operations. It is also likely that there will be a spill-over to the neighbouring farms.KAISA FARM BUSINESS PLAN reduce the cost of milk. however. the raw milk must be produced under hygienic production as it is the Kaisa Farm¶s objective to make quality products. as the Kaisa Farm hopefully expands its operations and / or as the staff change employment and / or the staff interact with peers. An efficient production may not necessary mean lower prices for the consumers.

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