INDUS DAIRY FARM

PURE & HEALTHY PRODUCTS

BY:
ISMAIL RAJPUT
MAZOOR MEMON
SAAD
IHSAN MEMON
HIRA JATOI
RUQIA KHUWAJA
 Indus Dairy Farm

1. Introduction:
The name of the venture is Indus Dairy Form, locatacted near Naushahro Feroze
bypass, in the province of Sindh, Pakistan. Its function is to provide milk and value added dairy
products to the Naushahro Feroze and it’s surroundings and some restaurents, hotels and
industries, The business will also provide cattle care services. For this venture one acer land
will be purchased in Rs.600,000. The total amount will be invested in the business will
approxemetly Rs. 5530,500. We will start this business with 9 buffalos and 6 cows. Our focus
will be on Sindh province specially on Naushahroferoz District. We would also rear animals for
sacrificial purposes that would almost yield 10000 per animal within two months. Initially we
plan to hold 2 calves for sacrificial purposes. The number of animals for fattening purposes
would be increased with our growth. Finally we would focus on a niche market, that is animal
banking ( i.e. rearing animals for certain fees or Adhyari). This would open up a new market.

Pakistan is fifth largest milk producing country but it lacks in organized farming. Pakistan have
to import powdered milk from various countries for meeting its domestic demand. We are
planning to add 5 animals per year as per our growth strategy. The milk pasturing unit is also
the core part of our growth strategy.

We will differentiate our business by providing Pure Milk, and Healthy Meat.
2. Financial Plan:
The total cost of the project is Rs. 5530500. Out of which capital cost of the project is Rs. 5270500 for
purchasing the animals and constructing the building and the rest is used to meet the working capital
requirement.

Project Cost:

Account Head Total Cost (Rs)

Land 600,000
Building/Infrastructure 1,545,500
Machinery & equipment 55,000
Animal Cost 30,00,000
Pre-operating costs5 70,000
Total Capital Cost 5270500
Raw material inventory 80,000
Cash 1,80,000
Working Capital Requirement (Rs) 2,60,000
Total Investment (Rs) 5530500

The proposed pre-feasibility is based on the assumption of 65% debt and 35% equity. However this
composition of debt and equity can be changed as per the requirement of the investor.

Project Financing:

Debt 65% 3594825

Equity 35% 1935675
Total project Investment 5530500
 Infrastructure cost Total:

Shed for Cows 1,500 310 465000

Open Paddock for Cows 1,500 10 15000
Shed for Buffaloes 2,000 310 620000
Open Paddock for Buffaloes 500 10 5000
Shed for Calves 550 300 165000
Open Paddock for Calves 550 10 5500
Shed for Calves (older than one year) 400 300 120000
Open Paddock for Calves (older then one 400 10 4000
year)
Stores for fodder, concentrate & machine
room

0
100 310 31000
Utensils & milk storage 100 310 31000
Servant Room, Wash room 200 420 84000
total infrastructure cost 1545500

Wage and Labor Cost:

Description No. Salary/month/Person Annual Salary (Rs)

Farm Supervisor 1 15,000 180,000
Workers 3 7,000 252,000
Total Labor Cost 4 432,000
INCOME Statement for 3 years:

Year 1 Year 2 Year 3

Revenue 2,834,800 3,553,000 4,317,400

Cost of goods sold 735,800 922,500 1,162,500
Gross Profit 2,099,000 2,630,500 3,154,900

General administration & selling expenses

Administration expense 432,000 474,060 520,215
Office expenses (stationary, etc.) 8,640 9,481 10,404
Professional fees (legal, audit, etc.) 12000 15000 18000
Depreciation expense 85861 85861 85861
Amortization expense 20000 20000 20000
Subtotal 558,501 604,402 654,480
Operating Income 1,540,499 2,026,098 2,500,420

Interest expense 400342 398282 380120

Tax 261884.83 344436.66 425071.4

NET PROFIT/(LOSS) AFTER TAX 878,272 1,283,379 1,695,229

Balance Sheet for 1st year:

Assets
Current assets
Cash & Bank 180,000
Raw material inventory 80,000
Total Current Assets 260,000
Fixed assets
Land 600,000
Building/Infrastructure 1,545,500
Animals 30,00,000
Revaluation Surplus/ (loss) -
Net value of animals 30,00,000
Machinery & equipment 55,000
Total Fixed Assets 5,200,500

Intangible assets
Pre-operation costs 70,000
Total Intangible Assets 70,000
TOTAL ASSETS 5,530,500

Liabilities
Long term liabilities 3594825

Stock holder's Equity

Paidup capital 1935675
Gain or loss
Retained earnings

Total equity 5530500

 3. Marketing Plan:

*Market research:
Marketing has a direct impact on overall business success. Changing buyer
demands, local and global competition, and Marketing research is the main basic component
to start a new business as we have not much knowledge about the market and its other
componentes in that area so we have decided to search for that and where the market of
cattle care business is standing now, we also want to know about the cutomers, goods
suppliers and others who are linked with the business, for that we have plan to start our
resarch on customers, goods suppliers and market. Beacuase our team is too mush intersted
to know about all those facts about the market.

For our marketing research first of all we will visit many cattle care
centers to know about the environment of centers and daily tasks who have started
performance in cattle care center, the tools for the business and their qulaity we will also try
to know the experience of owners of cattle care centers in the business and what kind of
difficultuies they face and how they resolve them. We will also visit google to know about the
some world class cattle care centers that how they are going in their business and what are
their strategies about the market. If we talk about the customers the mostly customers of
cattle care centers are from dairy firms, they puchase dairy products from the cattle care
centers and then they convert those in their products, for the other product cattle care like
meat we will contact only incially with only dealers on eid ul azha festival.
*Products:
1. Pure Milk; at reasonable price, without injecting buffalos, No mixture of powder, chemicals
and water.

2. Meat; Freash and healthy meat (free of water use) , no sick animals, anyone can see the
animals before slattering.

3. Cattle care services; Feeding on time, reasonable charges, Full care of animals, neat and
clean enviroment.

*Promotion:
We shall use cable media, A tea party to especial and populor persons, and use of penaflex as
well and we shall invite local people to visit the place and enviroment. We can take 200,000
promotion cost.

*Pricing:
Pricing will be reasonable so that people can afford for quality producys and services. We shall
compare the prices with competitors, The price will be relatively high then competitors
because of best quality and services, and people will willingly pay the prices for quality. Local
customers will not have the credit policy but companies and restaurants will have the credit
facility.
*Place:
Our business place is near Naushahro Feroze on national highway, people can come easily,
with a wide interior area along with parking place, as customers required. And there is no
competitor near to our business.

*Customers:
Local people, Tea Hotels, restuarents, milk pack companies, icecream producers.

I.e: Nestle foods company.

*Competition:
Local dairy forms will be the competitiors. But we shall make our image so strong that our
customers will remain loyal to us.

4. SWOT Analysis:
Strengths:
 Initially wide scope of milk production.
 Important source of food. i.e: milk & meat.
 Fresh meat and pure milk.
 Quality cattle care service.
 Vatenory medication.
 Neat and clean enviroment for animals.
 Reasonable price.
 Market approach and transportation.
Weaknesses:
 Hard climate of interior Sindh.
 Limited market area initially.
 No exports of products.
 Lack of record maintainance.
 Unawareness of basic farm managent practices.
 Dairy farm management is challanging work.

Opportunities:
 Very few dairy farms in Pakistan.
 No any dairy farm in Naushahro Feroze bypass.
 Always their is high demand of Milk.
 On Eid-ul-Azha high demand of Healthy live stock with high rates.
 High chances of growth.
 High demand of value added dairy products.

Threats:
 Security concerns.
 Viral dieases in live stock.
 Defective & unauthorized market.
 Inbalance of prices of inputs and outputs.
 Low saving.
 Sudden death of live stock.
 Fear of default.
 Increasing cost of production and higher rate of interest.