BUSINESS PLAN

NAME:

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YEAR OF STUDY:

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 THE BUSINESS PROFILE

Zinnykafor Nigeria (Best producer of the only meat to meet your need)

1.0 Executive summary

Zinnykafor Nigeria is into the production and sales of pork and life pig and is sited in Anambra
state. I plan to establish by June 2018 a company that will produce these pigs in commercial
quantity and sell to my numerous customers.

We aim to feed Nigeria with healthy meat and export to other countries. We will ensure that we
sell the highest number of pigs for pork in Nigeria and increase production every year in other to
satisfy our customers.

The most important thing in my business is hygiene and best practices in animal production.

Pig farmers, pig butchers, wholesalers, retailers, abattoirs, meat processing companies, food
packaging companies are my target customers.

My business is positioned to take advantage of growth trends in the industry.

My most important company strengths are measurement of life pigs weight, processing and
packaging of pork, none of my products are exposed for contamination, and best possible hygienic
measures are taken.

What We Intend To Sell

Zinnykafor Nigeria offers health pork and live pigs for daily consumption.
Financial Summary of the feasibility study
The business will be started largely by owner’s funds. It plans to fund its expansion
through a grants friends or family. The funds are mainly required to open a
production unit and expand into a larger wholesale establishment.

2
Business Opportunity
In Anambra and the eastern region, were there are high-end pork consumption and
production that offer house delivery services, this provides Zinnikafor with a unique
experience and opportunity to take advantage of the growth trend in the market.
Zinnykafor will serve Pig farmers, pig butchers, wholesalers, retailers, abattoirs, meat
processing companies, food packaging companies of over 25,000 potential customers.
Competitive Strategy:
The visible competitors of Zinnykafor Nigeria in Anambra state is De’pork Piggery and
Poultry Farm etc. who is the major pig farm in the town. Zinnykafor will be providing
the Anambra and community with high-end healthy and neatly produced pork and
live pigs. As a differentiated product and service provider, Zinnykafor will be
positioned at a lower price point to penetrate the market.
Founder:
Miss Chukwuma Benedicta is the founder of Zinnykafor piggery farm. She is vastly
experienced in the pig prouction industry having worked as the manager of NERZ Pig
farm Nsukka Enugu State. She is also a MOUAU ENT Trained Entrepreneur. She is an
undergraduate student of Agribusiness and Management at Michael University of
Agriculture, Umudike. Benedicta takes prides in her supreme customer service and
enormous experience, Zinnykafor is sure to gain attraction in the State.
Advantage of the Business
The businesses of Zinnykafor pig farm will serve as a source of living to the founder.
It will also provide employment to three (3) individuals. As a meat production
establishment, it will be a place of succour to individuals whose choice of food mostly
freshly processed meat for the events, home and healthy dietary purpose also for food
mineral and vitamin supplements.
Zinnykafor will succeed because we provide the most important basic need that is protein in form
of animal meat and our products are consumed daily by majority of Nigerians. Due to the fact that
3
the available meats are not enough and are not of the best hygienic standard, we will provide
quality meat and make profit.
With the experience, skills, and strengths of management and workers to be employed, we -will
ensure that this business grows to become a house hold name in Nigeria and a world class
company.

1.1 Mission and Vision

Mission Statement: To ensure effective and efficient production and distribution of meat at
affordable prices.

Vision Statement: To provide top quality meat for healthy living of people all over the nation.

1.2 Targeted Market and Customers

Pig butchers in Onitsha, Nnewi, Awka, Nkpor and Oba, Anambra State are our valued customers.
These customers buy pig from farmers in the state. It is our responsibility to locate and market our
products to them.

Local consumer of pork in Onitsha, Nnewi, Awka, Nkpor and Oba, Anambra State will be
encouraged through proper marketing technique using our point on purchase sales outlet. These
consumers buy pork in the market for consumption. Through proper marketing strategy, these
customers will be encouraged to buy our products.

Pig farmers in the state who need boar, piglets or sows are our targeted customers. They may
want to buy a boar, piglets or in- sows (pregnant pigs) for their farms. All pig farmers in the state
will be located and visited and how to sell products to them when they need them will be
strategized.

Wholesalers and retailers of pig in the state are our valued customers. They buy from farm and
resell to the butchers and consumers. They will be searched and located and their contact kept in
our record. They will be contacted when they need any product.

4
Public markets are places where our customers may want to come and buy our product. Sellers
of pork are also our targeted customers.

Abattoir and meat processing companies are our targeted market. Our product will be sold to
them for further processing.

Food processing and packaging companies like UAC foods and other food packaging companies
in the state, eateries, restaurants and hotels are also our targeted customers. These companies will
be encouraged to put pork in their menu, and will be sold to customers. A very good marketing
strategy will be employed.

1.3 Business Overview

The name of our business is Zinnykafor pig farm, which will be located at Nnewi
Anambra state. We specialized in production and distribution of Pork, live pigs and
pig by-product.
Zinnykafor pig farm is considers its business as a start-up, but will expand. The company objective
is to start the business in one location and then add new branches in different areas. We are part of
the meat production industry that intends to maintain a green and friendly environment. I plan to
take more than 50% market share in the long run because I will employ the latest production
technique more than the local farmers. All the pig farmers are my targeted customers because of
the production technique in artificial insemination in pig production to be used. I plan to be a major
factor in the market.

1.4 Success Factor

The growth trends on the market is seriously increasing rapidly and more consumers preferring to
eat pork because it is affordable and readily available upon increase production. However products
in the market are not packaged and I will take advantage of this. We will introduce product
packaging to increase product development.

5
The pig industry can be a very reliable one due to certain attributes of pigs and the Nigerian
production system. Pigs have a high survival rate and also have the ability to utilize a host of agro-
industrial bye – products and crop residues with little or no processing and minimal cost. Pork is
the most popular meat consumed in the world today and about 44% of the world meat protein
consumption is derived from pork and pork products.

 Pricing

My method of setting prices is based on weight of my life pigs and pork. For my business, my
pricing policy is higher than that of my competitors because I am starting. I will increase quality
of my products and use this to sell my products to my targeted customers. My price will be fair
and I will compete on quality.

My company will charge fifteen thousand naira for 100 kilogram of life pig. Our processed one
kilogram of pork will go for four hundred naira. Price is important in this market but my
customers mostly make their purchase decision on quality. This is my pricing power.

 Management

I will manage the business on a day‐to‐day basis. My experience with managing NERZ pig farm
will be brought to this business. With my management team and me as managing director, we will
grow this business and provide jobs to many Nigerians. Working hours will be from 8am to 4pm
everyday from Monday to Friday except for security agents who will work all day and night.

 Location Criteria

My location is important to my customers. This is because it will reduce the cost of transportation
This location is not close to residential areas in the town. This will also help us to transport our
raw materials and feeds from agro based companies in the state.

This is to prevent residents from complaining of the noise of the animals.

This location is good for expansion because there is vast area of land available.

6
When customers come to my location, it is convenient for parking.

The location is very close to my market and also very close to my raw material especially agro
based industries.

Space requirements

• Amount of space: This space will house four pens of 10 by 10 feet built strategically. The
space can house at least six pigs conveniently.

• Type of building: Low cost housing that will last for a long time.

• Power and other utilities: Power and water bole hole are required.

Organization and management

Zinnykafor is a sole proprietor business with just 3 employees. The business

proprietor and owner is Miss. Chukwuma Benedicta .

The management team will comprise the proprietor, purchase and delivery man and

2 workers

Position Function
Chukwuma Benedicta 1. Coordinates the day to day activities of the
business
2. In charge of purchases and delivery of raw
materials and products.

7
2.0 MARKETING

2.1 Marketing Plan

I plan to use the following marketing tactics

1. Personal contact and letters to butchers, pig farmers, wholesalers, retailers, abattoir and restaurants,
hotels and food packaging companies in the major cities of Anambra State.
2. Product packaging by selling my packaged pork and live pigs will be used. This is an added
advantage as most meat is exposed without being packaged.
3. Point- of –purchase display and sales outlet will be used.
4. Relationship marketing to pig farmer, and other customers will be employed. This is maintaining
relationship and communication. I will visit them; send texts messages on special days in their life
in other to maintain relationship.
5. Free samples to food packing companies and restaurant will be used to increase customer interest.
This is for our processed product.
6. Publicity for increase awareness of huge benefit of pork consumption and using the medium to
advertise our product will be used.
7. Billboards as part of publicity and increasing awareness of our product will be used.
8. Our product will be weighed and sold on scale with increase customer services.
9. Our price will be fair, correct price for the value of our product.
10. My marketing and sales manager will personally be responsible for the contacts with the
appropriate buyers.

When these innovative marketing tactics are employed and the customer show interest to buy, the
sales manager will sell to the customers directly. The customers will come to the farm to purchase
live pigs. If customers want us to deliver the live pigs, transportation charges will be included. For
processed products, it will be delivered to the customer. Sales agent will be employed to sell and
distribute the product in the state.

8
3.0 FINANCIAL ANALYSIS

In our projections we assume that

Inflation rate will balance the fluctuation during the year

Interest rate is expected to stabilize at ₦300.00 per dollar through the year.

My existing asset are worth ₦160,000. Will require the sum of ₦500,000 for

equipment raw materials and some overhead bills for a month

3.1 Start-Up Cost

The Start-up plan for this project is as follows:

Items Details Amount

Pre-operating expenses ₦200,000
Initial stock ₦150,000
Initial operating expenses 6 months ₦50,000
Total project cost ₦400,000

3.2 Source of funds

The funding requirement for this project is ₦750,000 and the company is counting

₦300,000 into the project.

Source Amount Percent

Personal fund ₦160,000 40
Family and friends ₦240,000 60
Total project cost ₦400,000 100

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3.3 Raw materials

S/N List of all expenses on raw materials Cost (N)

1 Pig Feed 30,000
2 Treatment and Drugs 5, 000
3 Pig 120, 000
TOTAL 155,000

3.4 Pre-operating activities and expenses

ITEM Description TOTAL AMOUNT

Rent ₦7,000/month ₦84,000
Equipment expense ₦91,000
Business registration ₦15,000
Advertisement ₦10,000
Total ₦200,000

3.5 Milestones

We want to achieve the following milestones as part of our business objectives

S/N Activity Funding Budget Period of

accomplishment
1 Purchase of land and Personal ₦3,500,000 3year
building of farm +loan
2 Introduction of poultry Personal ₦1,500,000 3year
3 Acquisition of a Personal ₦2,000,000 1year
purchase/delivery van +loan

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3.6 Farm Implements( Variable Cost)

S/ No Particulars Qty Unit Price (N) Total Value (N)

1. Water Bowls 10 100 1000
2. Water Gallons 10 500 5000
3. Bowl 10 50 500
4. Packer 3 50 150
5. Broom/brush 10 50 500
6. Shovel 100 400 4000
7. Wheel barrow 1 7000 7000
8. Plastics Bowls 5 300 1500
9. Izal disinfectant 5 100 500
10. Detergents 10 400 4000
11 Bucket 3 200 600
12 Weight gauge 2 7500 15000
13 Plastic Tank 1 52,000 52, 000
Total 91, 750

Estimated Purchase and Sale of 6 Pigs At December

I started with 6 pigs. 3 sows and 3 boars are purchased. The pigs will be purchased at N20, 000
each totaling N120, 000.

I assume only 2 pigs are given birth to instead of 3 piglets which is fair enough as an estimate.

At the end of the year, I assume I will sell first 6 piglets bought at N20, 000

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3.7 SWOT ANALYSIS

Strength
 Produce high quality pork
 Relatively good infrastructure systems
 Good marketing system
 Pigs are not seasonal products and can be eaten any time of the year
 In this area, the piggery business hasn’t been over-exploited
 Pigs are environmentally friendly

Weakness
 Capital intensive. Starting a pig business requires a large capital funding.
 Outbreak of disease can ruin entire business in a go.
 The smell can be quite disturbing

Opportunities
 Expansion into large scale production of by products(fertilizer)
 Export to neighboring towns
 A large and successful piggery will ensure food security

Threats
 More competition
 Swine flu
 High fat

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 3.8 SALES FORCAST
Periods SALES P1 P2 P3 P4 P5 P6 P7 P8 P9 P10 P11 P12 TOTAL
P1 Qty 6 20 20 20 20 20 20 20 20 20 20 20 226
Price 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 600,000
Amt 500,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 11,500,000
(₦)
P2 Qty 20 20 20 20 20 20 20 20 20 20 20 20 240
Price 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 600,000
Amt 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 12,000,000
(₦)
P3 Qty 20 20 20 20 20 20 20 20 20 20 20 20 240
Price 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 600,000
Amt 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 12,000,000
(₦)
P4 Qty 20 20 20 20 20 20 20 20 20 20 20 20 240
Price 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 600,000
Amt 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 12,000,000
(₦)
P5 Qty 20 20 20 20 20 20 20 20 20 20 20 20 240
Price 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 600,000
Amt 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 12,000,000
(₦)
P6 Qty 20 20 20 20 20 20 20 20 20 20 20 20 240
Price 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 600,000
Amt 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 12,000,000
(₦)
P7 Qty 20 20 20 20 20 20 20 20 20 20 20 20 240
Price 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 600,000
Amt 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 12,000,000
(₦)
P8 Qty 20 20 20 20 20 20 20 20 20 20 20 20 240
Price 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 600,000
Amt 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 12,000,000
(₦)
P9 Qty 20 20 20 20 20 20 20 20 20 20 20 20 240
Price 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 600,000
13
 Amt 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 12,000,000
(₦)
P10 Qty 20 20 20 20 20 20 20 20 20 20 20 20 240
Price 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 600,000
Amt 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 12,000,000
(₦)
P11 Qty 20 20 20 20 20 20 20 20 20 20 20 20 240
Price 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 600,000
Amt 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 12,000,000
(₦)
P12 Qty 20 20 20 20 20 20 20 20 20 20 20 20 240
Price 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 600,000
Amt 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 12,000,000
(₦)

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3.9 COST FORCAST

periods SALES P1 P2 P3 P4 P5 P6 P7 P8 P9 P10 P11 P12 TOTAL

P1 Qty 6 30 30 30 30 30 30 30 30 30 30 30 336
Price 20,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 1,120,000
Amt (₦) 120,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 3.420,000
P2 Qty 30 30 30 30 30 30 30 30 30 30 30 30 360
Price 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 1,200,000
Amt (₦) 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 3,600,000
P3 Qty 30 30 30 30 30 30 30 30 30 30 30 30 360
Price 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 1,200,000
Amt (₦) 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 3,600,000
P4 Qty 30 30 30 30 30 30 30 30 30 30 30 30 360
Price 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 1,200,000
Amt (₦) 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 3,600,000
P5 Qty 30 30 30 30 30 30 30 30 30 30 30 30 360
Price 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 1,200,000
Amt (₦) 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 3,600,000
P6 Qty 30 30 30 30 30 30 30 30 30 30 30 30 360
Price 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 1,200,000
Amt (₦) 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 3,600,000
P7 Qty 30 30 30 30 30 30 30 30 30 30 30 30 360
Price 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 1,200,000
Amt (₦) 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 3,600,000
P8 Qty 30 30 30 30 30 30 30 30 30 30 30 30 360
Price 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 1,200,000
Amt (₦) 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 3,600,000
P9 Qty 30 30 30 30 30 30 30 30 30 30 30 30 360
Price 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 1,200,000
Amt (₦) 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 3,600,000
P10 Qty 30 30 30 30 30 30 30 30 30 30 30 30 360
Price 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 1,200,000
Amt (₦) 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 3,600,000

15
P11 Qty 30 30 30 30 30 30 30 30 30 30 30 30 360
Price 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 1,200,000
Amt (₦) 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 3,600,000
P12 Qty 30 30 30 30 30 30 30 30 30 30 30 30 360
Price 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 1,200,000
Amt (₦) 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 3,600,000

16
 3.10 CASH FLOW PLAN

COMPONENTS PRE- P1 P2 P3 P4 P5 P6 P7 P8 P9 P10 P11 P12 TOTAL

STARTUP
Cash inflow
Cash at hand
Cash sales
Revenue 500,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 11,500,000
Equity 160,000 160,000
Grant 340,000 340,000
Total cash 500,000 500,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 12,000,000
inflow
Pre-operating 400,000 400,000
expenses
Opening
inventory
Total cost 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 3,600,000
Interest
Loan
repayment
Rent 7,000 7,000 7,000 7,000 7,000 7,000 7,000 7,000 7,000 7,000 7,000 7,000 84,000
Insurance
Other
purchases
Income tax
Total cash 400,000 307,000 307,000 307,000 307,000 307,000 307,000 307,000 307,000 307,000 307,000 307,000 307,000 4,084,000
outflow
Cash balance 100,000 193,000 693,000 693,000 693,000 693,000 693,000 693,000 693,000 693,000 693,000 693,000 693,000 7,916,000

17
4.0 Sensitivity analysis

4.1 Return on investment (ROI)

ROI gives the rate at which a business operation within a given period of time can

generate the investment made expressed as the ratio of earnings before interest and

tax (EBIT) and total investment (EBIT/total investment) a project will be accepted if

it is greater than zero

𝑝𝑟𝑜𝑓𝑖𝑡 𝑏𝑒𝑓𝑜𝑟𝑒 𝑡𝑎𝑥 + 𝑖𝑛𝑡𝑒𝑟𝑒𝑠𝑡

𝐸𝐵𝐼𝑇 =
𝑡𝑜𝑡𝑎𝑙 𝑖𝑛𝑣𝑒𝑠𝑡𝑚𝑒𝑛𝑡

𝟏𝟏, 𝟓𝟎𝟎, 𝟎𝟎𝟎 +0

𝐸𝐵𝐼𝑇 = = 0.95 ≅ 95%
𝟏𝟐, 𝟎𝟎𝟎, 𝟎𝟎𝟎

4.2 Summary/conclusion

Our project has high return on investment. The implication is that, the project will be

a very profitable business if implemented.

We will therefore like to be supported to commence the project implementation as it

will benefit all involved, proprietor, government promoters and general public.
5.0 Internal control

My experience in this type of business will help me set up a system of farm records and internal
controls to make sure that the company will receive all of its income without any of it being
siphoned off by waste, fraud, dishonest employees or carelessness.

Included in an internal control policy is who can sign for goods and services and who controls the
release of goods and services out the door. Included in the internal control policy will be the
requirement that the only person authorized to sign purchase orders, make capital acquisitions and
sign checks will be I personally.

5.1 Credit Policies

I plan to sell on credit to credit worth customers who have been proven to pay on time. I need to
sell on credit because the wholesalers buy large numbers and supply before they get their money
and pay. It is customary in my industry and it is expected by my customers.

Policy on who gets credit and how much are based on sales and volume of transaction in the past
and faithfulness in prompt payment over time.

I will check the creditworthiness of new applicants by not granting it on first time. I will make it
known that it is based on volume of product bought and paid for in the past. Upon time, I will
evaluate whether the new applicant is worthy or not. I will offer discount on prompt payment of
credit. The due date for credit will be due upon negotiated date. No payment dead line will be
extended and the customer will be held responsible for bridging the terms of the credit.

5.2 Business Risk

The following risk will be managed.

1. A key customer cancels a contract to buy my pigs or pork.

2. My sales projections are not achieved.
3. Failure to buy feed from a seller or company due to failure to deliver.
4. Public opinion on pork consumption due to religious, cultural and socio economic challenges.
5. Failure to find the trained and experienced labor.
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 6. Death of my animals in the farm.
7. Disease outbreak which cannot be controlled.
8. Death of piglet during delivery due to complications.
9. Paying my employee too much
10. Hiring friends and family members rather than most qualified candidate.
11. Under estimating cost of project and other costs.
12. Loss of sales.
13. Overlooking competition.
14. Not satisfying my customers.

My policy in handling problem or risks identified above will be to identify and acknowledge
problems promptly and honestly. I plan to put the following policies into effect promptly if and
when the following adverse scenarios emerge during my growth program.

The risk of running out of cash: I plan to maintain very frequent monthly cash flow projections.
Forecasts for income, expenses and unanticipated contingencies will be stated conservatively. Any
period of cash deficits will be remedies promptly by cutting cost to maintain a positive cash flow
and profitability.

Disease outbreak will be handled by the veterinary doctor and appropriate action taken to prevent
further outbreak and loss. Death and other related issues will be handled seriously.

A drop in sales or insufficient sales:

1. I will be prepared to take prompt remedial steps by cutting costs.

2. I will improve every aspect of product value, performance and image
3. I will seek out new ways to expand sales
4. I plan to stick with this specialized business that I know best unless fatally defective

Dishonestly, theft, shrinkage: I intend to implement the same policies that have been proven by
De’pork Piggery and Poultry Farm, one of my biggest competitors.

Business recessions: I am prepared to promptly cut costs to maintain liquidity. I will also be on the
lookout for good business opportunity during periods of adversity.

On 25% reduction of sales, I plan to increase cost on advertising to increase sales but maintain
cost of production due to increase number of pigs in the farm.

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