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FARM LTD
CHILI PEPPER BUSINESS FOR RWANDA
THE CONCEPT PAPER

EXECUTIVE SUMMARY

Chili peppers are the fruits of capsicum pepper self- pollinated plants, noted for their hot flavor.
They are members of the nightshade family, related to bell peppers and tomatoes and most
belong to a species known scientifically as capsicum annuum.

This world known food spice was originated from Mexico after the Columbian exchange, many
cultivars of chili pepper spread across the world used for both food and traditional medicine.
Green Chili pepper features heavily in the cuisine of the Goan region and all the Parts of India,
China and Indonesia In Asia, Mexico and USA in America and Turkey,UK and Spain in Europe.

There are many varieties of chili peppers such as cayenne (helps in hair growth) and jalapenos
Chili peppers are primarily used as spices or minor ingredients in various dishes, spice blends
and sauces. They are usually eaten cooked, or dried and powdered in which from they are
known as paprika. Capsaicin is the main bioactive plant compound in chili peppers, responsible
for their unique pungent(hot ) taste and many of their health benefits and several vitamins
such as : Vitamin C which is a powerful antioxidant, important for wound healing and immune
function, Vitamin B6 very important in energy metabolism, Vitamin K1: Also known as
phylloquinone, very essential for blood clotting and healthy bones and kidneys, Potassium: An
essential dietary mineral that serves a variety of functions in the body. Adequate intake of
potassium may reduce the risk of heart disease, Copper: Often lacking in the Western diet,
copper is an essential antioxidant trace element, important for strong bones and healthy
neurons and Vitamin A: Red chili peppers are high in beta-carotene, which is converted into
vitamin A in the body.

The European import of fresh chili peppers from developing countries has increased from an
average of 30-40 thousand tons in 2013-2015, to 40-45 thousand tons in 2015 and 2016,
Morocco and Turkey are mostly responsible for this growing supply.(Morocco 20.1 thousand
tones and Turkey 11.7 thousand tones) were the leading non-European suppliers of chili
peppers in 2017. Other medium-to- larger suppliers in 2017 included India,Uganda, Macedonia
and Kenya each supplying between one and two thousand tones, wholesalers in the European
market favor larger producers for reasons of supply certainty.

The chili peppers market is drastically spreading across Europe, Asia, America and the world
over thus creating high demand on chili peppers producers across the globe. …….Farm Ltd
produce, processes and exports packaged chili oil, dried or fresh red chili in Europe ,Asia and
America, to start by producing and selling fresh chili for market establishment.

Vision: we aspire to become the first Chili producers and exporters in Rwanda in the next 15
years.

Mission: To constantly produce and deliver the best quality chili pepper across the globe,to
make horticulture and permaculture in a more advanced way as well as engaging youth in
smart farming that leads to considerable personal development.

MARKET ANALYSIS:

Due to the present demand for certainty of various types of chili pepper supply; no doubt that
the demand is currently available in Asia and Europe.

The market for Chili pepper products is available in food industries, hotels, restaurants and
homes.

SWOT Analysis:

Below is the SWOT analysis for the chili pepper business in Rwanda.

Strength:

 Strongly passionate in this domain

 Technology and all facility premise available.
 Favorable climate for chili pepper production
Weakness:

 We are a startup with limited investment and experience.

 Have not yet secured overseas market

Opportunity:

 The current industry is virgin with potential of a fast ROI in one year.
 Seeds are readily available.
 The fastest growing and emerging markets
 Our country is highly devoting in agriculture.

Threat:
Limited capital to scale-up.

PESTLE ANALYSIS:

Political, economic, social and technology factors have been observed also for chili pepper
production in Rwanda.

Political Factor:

There is a political will by the Government of Rwanda to drive hard on the provision of
sustainable and high tech agriculture that boost economy of its citizens.

Economic:

The economic benefits of chili pepper business are huge both to the entrepreneurs since
payback period is guaranteed and assured market. Smart spices such as Chili oil is on demand
both in Rwanda and world over.

Social:

Since some farmers in Rwanda knew this crop for many years; mobilizing to form cooperatives
for chili pepper production shall not be difficult.

Technology:

Technology for both production and processing is enabling and available.

Environmental:

Chili pepper is an environmental friendly crop that enjoys most in temperate climate.

STRATEGY

SALES AND MARKETING

…….Farm will use its network in Europe, Asia and America to find importers, we will also attend
international trade fairs and make sure we brand for our products.

Our Pricing Strategy

Pricing depends on cost of production, processing and other uncontrollable factors; it has to be
competitive without compromising the quality of our products.

FINANCIAL ESTIMATES

CHILI PEPPER FINANCIALS-7MT PRODUCTION PER ANNUM

A. OPERATIONAL EXPENSES
S.N
o Particulars Total amount in (Frw) Total amount in (USD)
1 Land rental 250,000.00 $ 280.90
2 Seedlings 120,000.00 $ 134.83
4 Mulching 250,000.00 $ 280.90
5 Irrigation 1,315,600.00 $ 1,478.20
6 Fertilizes(animal compost) 120,000.00 $ 134.83
7 Insecticides 70,000.00 $ 78.65
8 Land preparation and planting 100,000.00 $ 112.36
9 Weeding 40,000.00 $ 44.94
10 Recolting and packaging 800,000.00 $ 898.88
11 permanent employee 960,000.00 $ 1,078.65
12 Follow up 200,000.00 $ 224.72
13 Transportation to the market 200,000.00 $ 224.72
14 Contingencies 500,000.00 $ 561.80

  Total 4,925,600.00 $ 5,657.98

  CAPITAL INVESTMENT
1 Irrigation machine and accessories 1,500,000 1,685.40
2 Pulverizer machine(2) 120,000 134.83
  Subtotal 1,620,000 1820.23
  Investment required 7,545,600 8478.20

C PROFITABILITY

1 Seasonal production (kg) 7,000.00  

2 Selling price per kg 1,500.00 1.69

3 Total sales 10,500,000.00 11,797.75

4 Gross profit before taxes 4,574,400.00  5,139.78

Notes:

1. With chili pepper, the production prolongs for 2 years thus making profit of USD
 10,279.55.
2. The pilot test is ongoing and we intend to scale up by production at five (5) hectares in
September 2019, thus making profit of USD 25,698.88 per year and USD 51,397.75
per two years of scaling up.
3. We intend to process and export chili oil in the future.
4. Exchange rate: 1US$ = 995 RWF

CONCLUSION

……welcomes funding partners to exploit potential for chili pepper in Rwanda and in the globe
at large.