Avocado oil Business plan

Table of contents:

Executive Summary…………………………………………………………………………………………1

Company Description………………………………………………………………………………………2

Market Description…………………………………………………………………………………………3

Organization and Management………………………………………………………………………4

Marketing and sales strategies……………………………………………………………………….5

Executive Summary:
Avocado production and exports have mostly recuperated after the effects of Hurricane Georges.
Preliminary estimates indicate a total production of 13,500 MT for CY 2000 and a forecast substantial
increase in 2001 (7- 10 percent increase). Very few farms have developed new acreage to expand
production, except for the Hass variety. There have been no government incentives to assist potential
producers. Local consumption is estimated at about five to six thousand metric tons. This is
approximately forty percent of total production, not including post-harvest losses which are not
included in production or consumption estimates (this is estimated at twenty-five percent). Dominicans
mostly consume the locally available criollo variety and commercial production which does not qualify
for export (due to deficiencies in grade, color maturity, minimum weight and diameter). The bulk of the
Dominican Republic’s exported avocados (95 percent) are bound for the United States (including Puerto
Rico and the Virgin Islands) with the remainder to the European Union, some Caribbean islands and
Canada. The natural market for the Dominican avocado has been the United States because of
proximity, price and the large numbers of Dominicans living in Chicago, Boston, New York and Puerto
Rico. U.S. Department of Commerce statistics show that the Dominican Republic is one of the top five
suppliers to the United States. U.S. Census data shows calendar year avocado imports from the
Dominican Republic at 6,291 MT valued at US$5.3 million for CY 1999 and 8,130 MT valued at $6.9
million for CY 2000. There is no governmental production policy nor direct support for avocado
production, consumption or export. High costs of inputs, refrigeration, credit and transportation
continue to discourage newcomers to the sector.

Company Description:

Welcome to Avocado Delight, where the vibrant landscapes of the Dominican Republic meet the
excellence of avocado oil production. At Avocado Delight, we take pride in cultivating avocados in the
fertile soils of our tropical haven. Our meticulous harvesting process, combined with state-of-the-art
extraction techniques, yields an exquisite, unadulterated avocado oil.

Avocado Delight, a premier company in the heart of the Dominican Republic dedicated to producing
high-quality avocado oil. Nestled amidst lush avocado orchards, we handpick the finest avocados to
extract rich, pure oil, capturing the essence of this tropical paradise. Our commitment to sustainable
practices ensures both the environment and your health thrive with every drop of Avocado Delight's
golden goodness. Elevate your culinary experience with the natural, flavorful essence of our Dominican
avocado oil.

Immerse yourself in the essence of our company a harmonious blend of tradition and innovation. Our
skilled artisans handpick each avocado at the peak of ripeness, ensuring a premium quality oil that
captures the essence of this Caribbean gem. The sun-drenched orchards and cool mountain breezes of
the Dominican Republic create the perfect conditions for avocados to flourish, resulting in a distinctive
flavor profile that sets Avocado Delight apart.

We believe in responsible farming practices, minimizing our environmental footprint while maximizing
the nutritional benefits of our avocado oil. From orchard to bottle, every step in our production process
reflects our dedication to preserving the natural beauty of the Dominican Republic.

Avocado Delight isn't just about oil; it's a culinary journey. Our avocado oil is a versatile companion in
the kitchen, enhancing the flavors of your favorite dishes with a touch of tropical elegance. Whether
drizzled over salads, used in sautés, or as a dip for artisan bread, Avocado Delight elevates every meal to
a gastronomic delight.

Market Description:
The Dominican Republic is the world’s second largest avocado producer, yet exports are a fraction of
production destined for local markets. Increased exports to higher-value markets could significantly
raise farmers’ incomes. High-quality agri-logistics are critical to accessing these markets by expanding
the services needed and decreasing their cost. Distribution logistics and cold chain management are
among the key hindrances for export competitiveness of perishable and semiperishable Dominican
products. The assessment will identify the most promising opportunities for the sector.

This is of utmost importance for the fruit industry, given the widespread locations of production, export
facilities, and tourist destinations. The primary fruit production zones are predominantly situated in the
southwest and south of the country for mango, the northwest for plantain, the southwest for avocado,
and the eastern (Monte Plata) and central regions for pineapple. The principal seaports and airports for
exports are located in Santo Domingo and Punta Cana. And cities such as Santo Domingo, Punta Cana,
Puerto Plata, La Romana, Samaná, and Santiago de los Caballeros serve as critical areas for tourism and
local consumption. The distances between these logistics points range from 8.5 linear kilometers to 573
linear kilometers, with a higher concentration of infrastructure in the areas surrounding Santo Domingo.

LOGISTICS MAP OF THE DOMINICAN REPUBLIC:

Agriculture: Sector Size and Performance:

The agricultural sector has been a keystone of the Dominican Republic’s economy and currently
represents 5.7 percent of the country’s GDP.176 Nevertheless, most producers are smallholders: about
71 percent of producers cultivate farms smaller than 4 hectares. A large part of production is dedicated
to crop activities (63 percent), followed by livestock activities (20 percent), and a combination of both
activities (17 percent).

Currently, agricultural exports from the DR to all markets represent around 18 percent of the country’s
total merchandise exports (about US$2 billion per year). The leading agricultural exports include cocoa,
bananas and plantains, and avocados. Additionally, thanks to a more flexible and open trading system
(that is, entry into the Central America–Dominican Republic Free Trade Agreement), the country has
made progress in phasing out most tariffs on fruits and vegetables and has also improved its sanitary
and phytosanitary measures.

After almost a decade of growth, Dominican tropical fruits have seen a decline in harvesting area and
production, while increasing in export value over the last two years (figure 4.14). Growth will lie in
continuing to improve access to higher value add markets rather than increasing production. The
following fruits represent 90 percent of exported products in the category “08 Edible fruit and nuts,”
and therefore, this assessment was largely based on their production and export data: bananas,
avocados, mangoes, pineapples, oranges, lemons, papayas, melons, coconuts, watermelons, and other
locally grown fruits such as fresh tamarinds, cashew nuts, jackfruit, lychees, sapodillo plums, passion
fruit, and carambola. As figure 4.14 shows, the value of fruit exports has increased over the last decade,
with higher growth for mangoes and more volatile growth for bananas.

Fresh fruits sector in the DR:

Harvested area: 214,293 hectares

• Production: 4.8 million tons

• Exports value: US$335 million (Exports are concentrated in a few countries and products; tropical
fruits are destined for the United States (27 percent), the United Kingdom (16 percent), the Netherlands
(11 percent), and Belgium (8 percent).

• The DR exports mostly agricultural commodities; however, 8.7 percent of agricultural land is dedicated
to organic production. The DR is the world’s largest producer of organic cocoa and organic bananas.

FRESH FRUITS PRODUCTION AND EXPORTS (BANANAS, AVOCADOS, MANGOES, PINEAPPLES, AMONG
OTHERS):

FIGURE 4.14:

Exports (value US$) Dominican Republic:

Avocado production in the Dominican Republic has gradually increased over the decades such that it has
become the fifth largest global producer and a relevant player for international markets, especially the
United States. The global avocado farming area reached 858,152 hectares (ha) in 2021, with the DR
share representing 4.4 percent (37,468 ha). The world’s main avocado producers are Mexico, Colombia,
Peru, Indonesia, and the Dominican Republic. As for domestic production, in 2021, the DR produced
643,388 tons179 and exported 56,456 tons (representing 9 percent of total production in 2021); the
value of the exports was USD$77,986,000, up 15 percent compared to 2020, making the DR the ninth
largest exporter in the world. The main buyer was the United States, followed by the Netherlands, Spain,
the United Kingdom, and Curaçao.180 In the DR, there are two avocado harvesting seasons every year;
the first runs from June to August/September for the Criollo, Simmonds, and Booth varieties; the second
runs from September/October to February/March for the Hass variety, which is mainly marketed in
Europe.

Key Constraints to the Development of Agri-logistics:

The Dominican Republic faces great challenges to consolidate its logistics infrastructure. According to
the latest World Bank’s Logistics Performance Index (LPI) measurements, the Dominican Republic has
remained average for Latin America and the Caribbean. However, in the most recent edition available
(2023), the country score declined from 2.68 to 2.6 (out of 5); the DR has worsened its results in this
survey in variables such as timeliness of delivery, international shipments, and tracking and tracing.
However, it has improved its performance in infrastructure and customs.200 Mexico and Panama are
the most important competitors for the Dominican Republic, and both countries are twice as efficient as
the DR in the LPI.
Leading destinations for exports of avocado from the Dominican

Republic in 2020, based on export value: (in million U.S. dollars)

Competition:

The avocado is one of the main fruits produced in the Dominican Republic and it is ranked in the fourth
position in the importance of fruits worldwide due to its planting area and marketing volumes. This fruit
sector has great prospects of development in the international market due to the strong unmet demand
in the markets of the European Union for the types of both green cultivars (Green Skin) and Hass variety.

The country has increased its avocado planting in order to meet the international demand. Such
scenario allows for a potential aim of export growth as a strategy to cope with the deficit in the
country's trade balance.

The production of competing countries with the Dominican Republic remains more or less stable in
recent years, which allows the country to explore the possibilities of a greater placement of the volume
of Dominican products in international markets.

In the Dominican Republic, the phenomenon known as the “avocado escape”, a term used in agriculture
to describe the harvest in large quantities of the product, begins at the beginning of November every
year. The Dominican Republic has four main areas of avocado production, and this fruit is currently
ranked in the third place of American export products. There are countries such as the United Kingdom,
Canada, the United States, Spain, France and Germany that become an export destination.

There are currently 21,875 hectares planted with avocados in the Dominican Republic, of which 32% are
in the North region, 28% in the Southwest, 26% in the Central region and 14% in the South region. The
vast majority of the avocado varieties are local.

The Dominican Republic, thanks to its different production areas, altitudes and varieties, has avocado
available throughout the year. However, the Hass variety is harvested mostly between the months of
September and February. Due to their situation, the times of greatest production will coincide with
those of Mexico.

There are different types of avocado varieties grown in the country. The main export is the Semil 34
type, which is harvested from October to January; Hass, which is the most demanded avocado in the
world and is produced in the Dominican Republic all year long (whose main destination is the United
States); Popenoe, which is harvested from May to July; Simmonds, Pollock and Doctor Dupoi, which
have a great acceptance in international markets. The country also grows the Carla variety, which is
harvested between March and April. There are other varieties that do not have a significant importance
in the markets.

Increasing Demand for Organic Avocado Oil:

Organic avocado oil is derived from organically grown avocados. The organic avocados are cultivated
without the incorporation of artificial fertilizers or harmful chemicals. The farmers use organic growth
stimulators in avocados cultivation. Organic avocados allow the retention of essential nutrients without
hampering the nutritional aspect of the product. The use of chemicals and fertilizers in conventional
farming mostly affects the health aspect and nutrients level. Rising inclination of people toward organic
products has encouraged the food manufacturers to invest heavily in products produced with organic
constituents. This is further projected to bolsters the growth of the organic Avocado Oil Market.

Consumer spending on organic food products has been increased consecutively in years. The consumers
in developed and developing countries such as the US, Canada, Germany, France, Italy, UK, China, India,
Japan, and Australia, among others, are willing to pay higher prices for organic products, such as organic
avocado oil. This demand is also ascribed to rising willingness to spend on healthy and nutritional food
and rising awareness among the consumers related to benefits offered by the consumption of organic
food products. The rising population demanding more healthy food options and increasing disposable
income have been fueling the demand for organic avocado oil. Therefore, the emerging trend of organic
food is projected to provide huge market opportunities for avocado oil producers over the projected
period.

Distribution Channel-Based Insights:

The avocado oil market, based on distribution channel, is segmented into hypermarkets and
supermarkets, specialty stores, online stores and others. The hypermarkets and supermarkets segment
accounted for a substantial share of the global avocado oil market, whereas the online stores segment is
expected to register the fastest CAGR during the forecast period. An increase in the global population,
coupled with an increase in the number of mobile phones online retail, has expanded significantly for
years. Benefits such as quick service, home delivery, different and secured payment options, and
attractive discounts have also fuelled the growth of online retailers worldwide. Consumers opt for online
shopping of avocado oil also because it saves time, and it is convenient. The manufacturers prefer selling
avocado oil online as it eliminates the need for wholesalers and retailers, thus giving them a larger share
in profits. Besides, selling online can help the avocado oil manufacturing companies to strengthen their
brand, control the pricing, and also to connect directly to customers. Companies such as Amazon,
Choosefoods, Natures Basket, Nykaa, Flipkart, and Rouhessentials are involved in selling avocado oil
online. The online retail segment dominates the distribution segment for the Avocado Oil Market as
online retail provides more options to purchase biscuits at a discounted price.

Project Organization:
The permanent staffs are 20, and contracted casuals range from 30-50 depending on the time of
theseason. The permanent staffs are mainly responsible for general management,
procurement andlogistic, quality control, and sales, while casual laborers
are responsible for picking upavocados, sales promotion, packaging, transportation, processing and so
on. The companywebsite management and packing such as bottling and labeling are outsourcing.
Marketing and sales strategies:
Local Branding:

 Develop a distinctive and appealing brand identity that highlights the quality and authenticity of
the avocado oil.
 Emphasize the Dominican origin of the avocados to resonate with local consumers.

Educational Campaigns:

 Conduct awareness campaigns to educate consumers about the health benefits of avocado oil
and its versatile culinary uses.
 Showcase the nutritional value and unique selling points through online and offline channels.

Influencer Collaborations:

 Partner with local influencers or chefs who can create engaging content showcasing the usage of
avocado oil in recipes.
 Leverage their credibility to endorse the product and reach a wider audience.

Tasting Events:

 Organize tasting events in supermarkets, farmers' markets, or popular public spaces to allow
consumers to experience the flavor and quality of the avocado oil firsthand.
 Provide promotional offers or discounts to encourage immediate purchases.

Retailer Partnerships:

 Establish partnerships with supermarkets, health food stores, and specialty retailers to ensure
widespread availability of the avocado oil.
 Implement attractive in-store displays and promotions to capture consumer attention.
Online Presence:

 Develop a user-friendly website with e-commerce capabilities to facilitate online sales of

avocado oil.
 Utilize social media platforms to engage with the audience, share recipes, and run targeted
advertising campaigns.

Promotional Bundles:

 Create promotional bundles or packages that encourage consumers to try multiple products or
sizes.
 Offer limited-time promotions, discounts, or exclusive deals to incentivize purchases.

Certifications and Quality Seals:

 Obtain and prominently display relevant certifications for quality and authenticity.
 Highlight any organic, non-GMO, or other certifications that align with consumer preferences.

Customer Loyalty Programs:

 Implement a customer loyalty program offering rewards, discounts, or exclusive access to

encourage repeat purchases.
 Collect feedback and use it to continually improve the product and customer experience.

Collaboration with Restaurants and Culinary Events:

 Partner with local restaurants and chefs to feature avocado oil in their dishes.
 Sponsor or participate in culinary events to showcase the versatility of avocado oil in various
cuisines.

Promotion:
.Advertising

Online advertising. For example, News and stories about avocado nutrition andrecipe with avocado oil
are updated every day online to maintain
customersloyalty on such social networks as Face Book, Telegram, Twitter. Besides,advertise on
attractive websites and video platforms.

 Attending some exhibitions and fairs

 Cooperating with some charity groups and donates some of the revenue to helpchildren to get
nutritious food in distant areas

 Designing some packages with some high-end products such as milk power or wines in certain
festivals such as Ethiopian New year and Christmas festivals.

 Holding some free cooking course or lectures for pregnant women or mothers toadvertise
avocado oil

 Advertising on local newspapers and food magazines Promotional gifts (freesamples and other
materials

Sales promotion:
Avocado oil is different from olive and other oil in that avocado oil produce a light creamsmell while
olive oil and other produce a little bit spicy grass flavor, so avocado oilis more preferred by babies. Apart
from that, the vitamin A, B, C, D, E of avocado oil is four times more than that of same amount of olive
oil. Avocado oil is full of nutrition as fruit oil. The rich omega 9 helps to anti-
inflammation and thedevelopment of nervous system, mentality and vision as well. It can also lower
therisk of atherosclerosis, cardiovascular diseases and stroke. Avocado is free of cholesterol, and low of
sugar and starch.