E nter p r ise

G r o w th S er vic es

H o w c an c h ic k ens l ay
th e f o u nd atio ns f o r
h eal th ier c o m m u nities?
With EY’s help to improve efficiency,
EthioChicken can provide more malnourished
families with an affordable source of protein.
ey . c o m / egs # B etter Q u estio ns
 “ E th ioch ick en”

S ocial entrep reneurs are using th e p ow er of th e m ark et L ocal b reed

to innovate p ath s out of p rob l em s as diverse as j ob
creation, social ineq ual ity and l ack of access to l if e-
enh ancing services l ik e h eal th , education, energ y, cl ean
w ater and sanitation. Th ese are true l eg acy b uil ders
and sup p orting th em is th e reason E nterp rise G row th
S ervices ( E G S ) exists.

O p erating at h eavil y sub sidiz ed rates, E G S extends th e

benefit of EY’s services to people and places we don’t
norm al l y reach . B y h el p ing th ese sm al l and g row ing
entrepreneurs to operate more efficiently and grow
sustainab l y, w e extend th eir reach and im p act — a rip p l e
ef f ect th at is ch ang ing l ives and l ivel ih oods in som e of
the world’s most deprived communities.
G r eater f o o d sec u r ity . An “ eth ioch ick en” is b ig g er, m ore
resil ient, reach es m ark et- w eig h t f aster and l ays nearl y f our
tim es as m any eg g s com p ared to l ocal b reeds. Th ese are vital
considerations in E th iop ia, a country w h ere nearl y h al f of al l
ch il dren are m al nourish ed.

2 | E nter p r ise G r o w th S er vic es — E th io C h ic k en

Helping entrepreneurs
change lives

2 m ch ick s
p e r y e a r
10 U S $ 12 0
1m ch ick s
s in c e 2 0 1 0

1 y e a r 3 y e a rs

S u p p o r ting entr ep r eneu r s. E th ioC h ick en op erates via
a network of smallholders who act as agents. A flock of
10 “ethiochickens” can produce a profit of US$120 per year —
a m aj or contrib ution to th e h ouseh ol d in a country w h ere p er
capita income is US$470.
A l o c al su c c ess sto r y . E th ioC h ick en h as al ready distrib uted
one million chicks since 2010. Its ambition is to double the
num b er of day- ol d ch ick s it p roduces to tw o m il l ion a year
w ith in th ree years, and exp and op erations.

E nter p r ise G r o w th S er vic es — E th io C h ic k en | 3

1
EthioChicken is not just
improving food security; it’s
creating a new generation
T h e p r o j ec t of entrepreneurs.
Sixty percent of Ethiopia’s smallholders — the vast majority of whom
are women — keep chickens. They’re an important source of protein
in a country w h ere al m ost h al f of al l ch il dren are m al nourish ed, and
what’s more, chickens are relatively easy to raise. However, local
b reeds typ ical l y tak e a year to reach m ark et w eig h t, p roduce an
averag e of 6 0 eg g s a year and are h ig h l y suscep tib l e to disease.
Th is is w h ere E th ioC h ick en com es in. Th e com p any, one of th e
l arg est p oul try p roducers in E th iop ia, sp ecial iz es in F rench and
D utch b reeds th at are b ig g er and m ore resil ient to th e h arsh l ocal
environm ent. And in contrast to th e l ocal variety, an “ eth ioch ick en”
reaches market weight in three months and lays 230 eggs a year.
EthioChicken is not just improving food security; it’s creating a new
g eneration of entrep reneurs.
Th e com p any runs on a f ranch ise m odel — rath er th an raising th e
ch ick ens th em sel ves, th e com p any h as devel op ed a netw ork of
sm al l h ol ders w h o act as ag ents. Th ey b uy day- ol d ch ick s, raise
them to maturity, and sell the meat or eggs for profit. A flock of
10 “ethiochickens” can produce a profit of US$120 per year to an
ag ent, a m aj or contrib ution to th e h ouseh ol d in a country w h ere
per capita income is US$470.
N etw ork of
140 agents
Five
p roduction f acil ities
4 | E nter p r ise G r o w th S er vic es — E th io C h ic k en
It’s this focus on entrepreneurship that attracted the attention
of Acumen, a US-based venture capital fund that supports
entrep reneurial com p anies around th e w orl d. Today, Acum en is one
of th e investors b eh ind E th ioC h ick en and is com m itted to b ack ing
its next stag e of g row th , w ith h el p f rom E G S .
E th ioC h ick en is al ready a success story in north E th iop ia, h aving
distributed more than a million chicks via a network of 140 agents
since 2010. Its ambition is to double the number of day-old chicks
it p roduces to tw o m il l ion a year w ith in th ree years, and rep l icate its
success in th e south of th e country. To th at end, th e com p any w il l
b eg in m anag ing anoth er tw o p roduction f acil ities, tak ing th e total
number up to five.
In order to expand sustainably, EthioChicken needs to first connect
al l p arts of its currentl y disp arate b usiness th roug h an E nterp rise
R esource P l anning ( E R P ) system . J ack G ol dstein, an Advisory
senior b ased in L ondon, sup p orted b y f el l ow Advisory col l eag ue
Selamawit Bekele (EY Ethiopia), spent three months in Ethiopia on
an EGS assignment working with Acumen and EthioChicken to find
th e m ost ap p rop riate E R P system .
It was also part of the EGS team’s remit to work closely with
EthioChicken’s management to examine their back office and
identif y im p rovem ents to existing p ol icies, p rocesses, and data
cap ture and m anag em ent.
Project phases

Assess
Understand EthioChicken, including desired
future state
Interview staff and customers
Understand local business environment, including
software market

Analyse
Test solution for robustness, scalability and
availability of local support
Identify additional improvements to existing back
office policies, processes, and data capture and
management

Deliver
Issue proposed strategy paper; outline current
situation, recommendations, budgets and
timescales
Identify additional cost and efficiency
improvement opportunities, prioritized according
to greatest impact

Enterprise Growth Services — Jibu —  | 5

2
T h e c l ient’ s p er sp ec tive:
“EY’s support will
help us make the
best decisions
for our business,
J o sep h S h iel d s enable us to grow,
At EthioChicken, our focus goes beyond profit growth — we’re also
concerned ab out p roducing a source of p rotein to m ak e a dif f erence
and thereby have
in our country.
an even greater
positive impact on
L ack of p rotein causes h eal th issues in ch il dren th at, if l ef t
untreated, l ead to devel op m ental p rob l em s such as reduced
language, learning and social skills. It’s a long-term issue that
af f ects society as a w h ol e.

W e w ant to continue to scal e our b usiness, so th at w e can h el p k eep

m ore ch il dren h eal th y.
To do so, w e need an accurate, real - tim e view of our entire
organization — for example, we want our finance department to be
able to “talk” to HR, and the warehouse to be linked to sales. That
way we can produce operational, sales and financial information
including KPIs in real time, and better identify risks such as waste
and th ef t. Th e w ay to do th at is th roug h an E R P system .
The EY team were a great help. They brought a wealth of
k now l edg e ab out tech nol og y; th ey al so k new h ow to navig ate th e
business environment in East Africa; and they were flexible, given
the challenges of doing business in Ethiopia. For example, it’s not
uncommon to have internet access for only 30 minutes a day and
th ere are al so f req uent p ow er outag es.
our community.”
Th e resul t w as a h ig h - q ual ity, p rof essional , p ractical rep ort th at h as
h el p ed our org aniz ation im m ensel y. B ased on th eir interview s and
research , w e now h ave a strateg y p ap er th at covers an assessm ent
of our current situation, recom m endations f or an E R P system ,
b udg ets and tim escal es.
In addition, their analysis of our back office identified more than
100 cost and efficiency improvement opportunities that were
p rioritiz ed according to w h ich w oul d h ave m ost im p act, and
accom p anied b y an im p l em entation p l an.
EY’s support will help us make the best decisions for our business,
enab l e us to g row , and th ereb y h ave an even g reater p ositive
im p act on our com m unity.

6 | E nter p r ise G r o w th S er vic es — E th io C h ic k en

3
“It’s been extremely
rewarding to be
involved with a
T h e c o nsu l tant’ s p er sp ec tive: pioneering company
J ac k G o l d stein like EthioChicken
As I analysed EthioChicken’s business, and talked to its staff and
where you play a
customers, I got a good understanding of the organization: some
of its b usiness is onl y conducted on p ap er, som e orders are tak en small part in directly
transforming
m anual l y, and in som e instances p rocesses are autom ated. Th ese
dif f erences w ere causing inaccuracies, del ays and dup l ication.

It’s hard for EthioChicken to review and monitor actual financial

performance compared to budget, and it’s equally challenging to peoples’ lives. I’d do
it all again tomorrow
prepare accurate and timely financial reports.

A m aj or p art of our p roj ect invol ved w ork ing w ith col l eag ues in

if I could.”
EY Ethiopia to better understand the local software market, in
order to source systems that are robust, scalable, fit for purpose
and well supported locally. I received particularly significant pro
bono support from Amaha Bekele of EY Kenya, who leveraged his
contacts and k now l edg e to g reat ef f ect.

The local EY team’s knowledge was extremely useful. There aren’t

yet m any estab l ish ed p rivate enterp rises in E th iop ia, w h ich m eans
there isn’t much in the way of information or support to help
local companies to scale. It occasionally felt like I was a detective,
f ol l ow ing up contacts, w ork ing out h ow to g et around dead ends
and track ing dow n sug g estions on suitab l e vendors.

This EGS assignment was a huge learning curve. It was my first time
to lead a project, in a completely different environment to what I’m
used to, and I had to adapt quickly.

I also worked outside my usual area of strategy to cover finance,

HR, procurement, sales and IT. As a result, my confidence as a
consul tant h as g row n.

On a more personal level, it’s been extremely rewarding to be

invol ved w ith a p ioneering com p any l ik e E th ioC h ick en, w h ere you
play a small part in directly transforming peoples’ lives. I’d do it all
again tomorrow if I could.

E nter p r ise G r o w th S er vic es — E th io C h ic k en | 7

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