Eric Mugume's Egg Production Enterprise

ERIC MUGUME’S EGG PRODUCTION ENTERPRISE: Business Plan
Corporate Document
1.0 INTRODUCTION
1.1 Project Brief
This Business Plan details the establishment and long-run continuous operation of a
medium-sized poultry egg production facility with a starting layer stock of 2,000 Hy-
line Brown or Shaver breed layers. One of the most attractive and potent
economic reasons for engaging in poultry egg production business in Uganda is the
fact that it is one of the most proven routes to homestead-based economic
empowerment as well providing a stable and assured source for improved
standards of living and food security. Hence, this is the primary motivator that has
inspired the project’s principal promoter – Mr. Eric Mugume to give first-line
priority consideration in setting up this poultry egg production enterprise as a
home-based enterprise that will be located at ------------------- in ------------------ District.
Besides, there are other reasons why raising chickens in Africa makes good sense.
For one, as the population increases, available land decreases, yet farmers don't
need a lot of land to raise chickens. Grazing cattle in a changing climate is also
unpredictable, but chickens can cope with drought and flood far better than cows.
Chickens also turn grains into high value protein, fast. But perhaps most
importantly, unlike growing cash crops or milking dairy cows, poultry doesn't mean
a lot of extra work for already overburdened home-based labour.
Looking at commercial egg production in Uganda, Shaver and Hy-line birds

continue to be the most popular, with both day-old chicks and fertile eggs imported
and hatched domestically. The majority of Ugandan producers prefer to keep their
birds in production for up to one and a half years. To them, this is usually more
profitable and cost-effective than culling after one year. On most layer units in
Uganda, the mean annual production per bird stands at 230-240 eggs, and the farm
gate price stands at 100-160 shillings per egg ($0.05-0.08). According to size, this
usually leaves the farmer with a profit margin of about 10-12% per egg.
The purpose of this Business Plan is to solicit for a 3-year loan facility that will be
applied to purchase the initial chicken layer stock, put up the requisite chicken
housing and other relevant infrastructure at the proposed project site, acquire the
necessary poultry farm production equipment and machinery, and set aside a
sizeable intitial working capital budget for purchase and inventory stock-up of feeds,
vaccines and drugs, plus payment for labour and other vital farm-use utilities and
inputs.
However, the over-arching strategic purpose of the proposed poultry egg production
enterprise is for it to emerge as one of the key exponents in providing domestic
consumers with a a steady and reliable source of lean protein, as well as stimulating
the local economy by adding value to agricultural activities.
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Layer farm business is a Live Stock based project. The major portion of the cost in
operating a poultry egg production business is on poultry feed.
Day old chicks of Layers are initially reared for a period of 5-6 months. On
completion of 5-6 months, the birds then start laying eggs for a period of next 52
weeks (12 months). On an average, one layer lays about 230-240 eggs per laying
season of 52 weeks.
After the completion of laying period, the layers are sold in the market as culled
birds. The selling price of these birds is determined on per bird basis.
1.2 Opportunity Rationale
Layer farming is a vital source for providing high quality animal protein ( Eggs)
which is daily requirement of the human body. Animal Protein is more valuable than
that of plant protein.
The Ugandan population of over 30 million people is comprised of 75% Christians

and 25% Muslims and non-religious denominations, such as animists. The country's
positive economic growth and development, which has been in the range of 5-8%
over the past 10 years, has also been reflected in the continuing positive growth
trends in production and consumption of poultry products in the country. From
2000-2006, egg consumption per capita increased considerably (28%) and poultry
meat consumption rose by over 60% (Table 1).
Table 1: Per capita egg and poultry meat consumption in Uganda from
2000 to 2006.
Year Eggs (number) Meat (grams)

2000 25 1,400
2002 28 1,800
2004 29 2,200
2006 32 2,300
Fast food outlets
Poultry meat and eggs are, of course, not the only livestock products consumed in
Uganda. Rising levels in the consumption of poultry products, however, can be
partly attributed to the rapidly rising number of fast food outlets selling ready-to-eat
poultry meat and eggs in a clean attractive environment. This is encouraging more
people who had previously been eating poultry products only occasionally, to now
consume them on a more regular basis. These fast food outlets serve the needs of
the growing number of young middle-class people who often don’t have time to
cook for themselves. In addition, the price of poultry dishes served from these fast
food outlets is usually pocket-friendly, making them affordable for those even in
lower income levels. These fast food chicken and other poultry products outlets are
also popular with the ever increasing number of tourists visiting Uganda every year.
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Modern breeds available
Although the meat and eggs from village birds continue to be well liked by many
Ugandan consumers, who prefer the longer grown, hardier meat and eggs with a
much deeper yellow yolk, the biggest supply of poultry meat and eggs to
households, hotels, restaurants, and other catering units, and the retail and
wholesale sectors of the market in Uganda continues to come from the modern bird
breeds – which are increasingly being reared by commercial farmers and a variety
of other poultry growers on semi-commercial and commercial poultry production
sytems throughout the country.
In summary, it can be herewith stated that in proposing to establish this egg poultry
production business/facility, the major motivations of Mr. Eric Mugume can be
summed as follows:-
(a) Tap the fast-growing market opportunities and increasing popularity for
poultry products throughout Uganda.
(b) Generate a strong farm-based income that will lead to fast growth of cash
flow and exponentially improve on the enterprise’s rate of return (ROI) and
profitability.
© Utilize the existing land and natural resources to the best commercial
advantage of the enterprise by using good farm and environmental
management practices for sustainable productivity and growth of the farm.
(d) Provide employment opportunities for locals within the area.
(e) Make the farm a model poultry egg production project that will grow to
inspire other up-and-coming poutrly farming enterprises within the area by
serving as a self-sustaining demonstration unit for agricultural inspiration and
on-farm training.
1.3 Total Project Cost
The proposed poultry egg production facility will start off with a bird population of
2,000 birds in an operator/promoter-owned land (valued at approx. Ushs. 20
million) requires a small capital investment of about Ushs. 2.98 million for
purchasing farm machinery and equipment. In addition to this, a sum total of UShs.
16.988 million is required as start-up working capital, which will be used for
purchasing Hy-line or Shaver layer stock (as day-old-chicks), plus raw material (feed
& vaccines) etc., and finacing the project start-up operating costs (that include
brooding expenses, labour expenses, utility bills, and transport expenses) for the
first 4 – 5 months of the project. When all the requisite mixed farm set up inputs are
factored into the project, the total capital cost of the project amounts to UShs.
64.588 million.
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1.4 Proposed Capacity
2,000 layer birds are a viable starting economic size to operate a robust poultry
farm, where the operational and fixed costs are justifiable. These birds (the layers)
are kept for eighteen months, which includes a rearing period of 5-6 months and
laying period of 12 months.
Table 2: Summary of Total Project Cost
Account Head Total Cost

(UShs.)
Land 20,000,000
Farm Buildings & Structures 4,620,000
Farm Machinery & Equipment 2,980,000
1 Pick-up Vehicle 20,000,000
Purchase of 2,000 Layer DOCs (Day Old Chicks) @ 2,250/= 4,500,000
Total Fixed Costs 52,100,000
Raw material inventory 5,218,399
Initial operating costs 7,270,000
Total Working Capital 12,488,399
Total Project Cost (UShs.) 64,588,399
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2.0 EXECUTIVE SUMMARY
ERIC MUGUME’S EGG PRODUCTION ENTERPRISE is a sole-proprietor mixed

farming enterprise based at ------------------- in --------------- County of
---------------- District with a special interest on poultry egg production that is
designed to meet an unsatisfied and growing marke demand need for quality
poultry products in the mostly urban areas of Uganda. The close proximity of the
ERIC MUGUME’S EGG PRODUCTION ENTERPRISE to the Kampala City will
ensure that the egg-production facility assumes a fast and steady growth character
owing to the concentration and proximity of households, hotels, restaurants, other
catering units, as well the highly significant retail and wholesale segments of the
Ugandan market. ERIC MUGUME’S EGG PRODUCTION ENTERPRISE objectives
are to develop a product-based enterprise whose goal is to exceed customer's
expectations, increase production efficiency by 10% a year, and lastly, and develop
a sustainable farm business, able to survive off their cash flow.
Products
ERIC MUGUME’S EGG PRODUCTION ENTERPRISE’s main output product will be

eggs weighing on average 50 – 55 grams per unit that are major consumption item
on the domestic poultry products market.
The Market
ERIC MUGUME’S EGG PRODUCTION ENTERPRISE is essentially focusing its

market outreach for the poultry eggs on principally four (4) market channels, which
include: (i) the local hotels and restaurants within the hospitality industry and
catering to a rapidly-growing domestic and tourist market segment; (ii) the
institutional egg-consumption market comprising of large governmental as well as
private sector institutions including universities, some urban schools and hospitals –
which have a more uniform demand and can be regular customers; long-term
contracts are possible. Delivery and service are important to this channel.; (iii) the
retail and wholesale market segment that comprises of local market
vendors/retailers and large chain supermarkets (e.g. Uchumi, Nakumatt, Shop
Rite, Capital Shoppers, etc.); and finally, (iv) export traders – who have secured
steady export market egg-supply contract to countries such as South Sudan, DR
Congo, etc.
In accessing and negotiating poultry egg supply deals with these markets, ERIC
MUGUME’S EGG PRODUCTION ENTERPRISE will mostly use the method of
negotiating and securing spot and forward egg-supply contracts – especially the
supermarket that have the deep pockets, consistency of demand, and business
organization to offer long-term supply egg-supply contracts, as well the logistics
capacity to collect eggs from proximally-situated egg-production-and-supply farm
units.
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Competitive Edge
ERIC MUGUME’S EGG PRODUCTION ENTERPRISE will employ two competitive

edges that will help them maintain strong growth rates, increasing their market
penetration. The first edge will be quality ERIC MUGUME’S EGG PRODUCTION
ENTERPRISE pride itself on the high quality of poultry egg products. Poultry egg
products and pigs that do not meet ERIC MUGUME’S EGG PRODUCTION
ENTERPRISE high standards of quality will be rejected as imperfects and go to a
not-for-profit food bank. ERIC MUGUME’S EGG PRODUCTION ENTERPRISE's
second competitive edge is its flexibility. The entire farm will be set up in such a
manner as to allow it scale existing poultry production output to meet demand. This
is a highly unusual business phenomenon as most livestock farms are unable to
scale up their productivity output at a short moment’s notice.
Management
ERIC MUGUME’S EGG PRODUCTION ENTERPRISE was founded and is headed by

Eric Mugume. Eric is a well-educated, outgoing, dynamic and energetic
agricultural entrepreneur who draws special inspiration and livestock-rearing
instincts from his strong farming family background. Eric’s main advantage is that
he has had a previous background exposure to livestock farming projects in
Mbarara District though at a much more limited scale than what he projects to do.
The additional motivator is the fact that he already has a reasonably-sized poultry
farm space (at his present residential location) as well as some personal savings
and financial capital (equity) that he has purposefully set aside and earmarked for
setting up the poultry farming infrastructure and other related production facilities.
2.1 Objectives
The objectives for the first three years of operation include:
1. To create a product-based egg-production enterprise whose goal is to exceed

customers' expectations.
2. To utilize the existing land and natural resource base to the best commercial
advantage of the enterprise by using good farm and environmental
management practices for sustainable productivity and growth of the farm.
3. To increase the efficiency of our production by 10% a year.
4. To develop a successful and sustainable enterprise farm, surviving off its own
cash flow.
5. Achieve positive cash flow once the layers begin their production cycle.
6. To become an active agent in the reduction of food insecurity and
malnutrition in Uganda – especially in children, by providing an adequate and
reliable supply of eggs to local markets.
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7. To stimulate the local economy by adding value to local agricultural
production and providing an expansion strategy to facilitate a transition
towards commercial production.
8. To develop the local economy with the introduction of scale-optimized egg
production
2.2 Mission
ERIC MUGUME’S EGG PRODUCTION ENTERPRISE’s mission is to provide the

highest-quality poultry egg products. The farm exists to attract and maintain
customers. When the ERIC MUGUME’S EGG PRODUCTION ENTERPRISE adheres
to this maxim, everything else will fall in to place. ERIC MUGUME’S EGG
PRODUCTION ENTERPRISE’s services will exceed the expectations of our
customers.
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3.0 ENTERPRISE SUMMARY
ERIC MUGUME’S EGG PRODUCTION ENTERPRISE is a scale-optimized poultry

egg production enterprise specializing in the production of marketable eggs
targeting the fast-growing domestic Ugandan market and tastes for exotic chicken
poultry products. ERIC MUGUME’S EGG PRODUCTION ENTERPRISE is located
----- kms off Kampala – Entebbe highway at --------------- village in -------------------------
County of ------------------ District. ERIC MUGUME’S EGG PRODUCTION
ENTERPRISE will principally sell its poultry eggs to four domestic market channels
that include – the local hospitality industry hotels and restaurants; the urban
institutional conumer market; the retail and wholesale market; and the poultry egg
export market represented by egg-exporters.
The farm business will be based out of Mr. Eric Mugume’s home at the farm site
at --------------------------.
3.1 Enterprise Ownership
ERIC MUGUME’S EGG PRODUCTION ENTERPRISE is a sole proprietorship with

Mr. Eric Mugume as its founder and promoter. Eric proposes to finance the
poultry egg production enterprise through both his own cumulative personal
savings and future re-current financial inputs and loan facilitations to be covered
under a farm-support credit finacing facility for a three-year period.
3.2 Start-Up Summary
ERIC MUGUME’S EGG PRODUCTION ENTERPRISE will use the existing land and
other basic infrastructure on site as the start-up investment platform of the project
as proposed in this Business Plan. These existing structures on site can easily be
transformed into poultry housing units (coops) – with some modification and
improvements – and should as such count as a significant equity capital base
towards the total investment cost of the project.
Other project inputs that will be contributed by the principal project promoter – Mr.
Eric Mugume will include a transportation pick-up vehicle (valued at about UShs.
20 million) for moving feeds, raw materials, and other essential production inputs to
the farm, while at the same time transporting out poultry eggs to the market –
during the laying period
The short-term credit facility will specifically be designated to financing the

completion of poultry housing infrastructure; purchase and installation of poultry
production equipments and machinery; purchase of the initial stock of 2,000 day-old
Hy-line Brown or Shaver chicks; acquisition of raw materials for egg-production;
while also meeting the initial operating costs of the business – for the first four (4)
months of the project in the run up to the full laying period.
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4.0 CURRENT INDUSTRY STRUCTURE
4.1 Poultry Production Systems
4.1.1 Background Information
The high growth rate of the Ugandan population and increases in urban migration
have increased demand for food. These factors have put pressure on land and other
resources for food production and other necessities. This has led to a focus on
farming systems and/or enterprises that maximize yield per unit area and input and
poultry production has been identified as one of the enterprises that falls within this
category. Meat consumption in Uganda is low and is estimated at 5.6kg compared
to 50kg recommended by FAO and WHO. According to 1994 figures, there was a
meat consumption gap of 800,000 tons. The annual rate of increase is projected to
be 7.4% for beef and goat meat, 3.32% for pork and 4.87% for chicken.
Chicken production is the main type of poultry production in Uganda. Turkeys,

guinea fowls, ducks, pigeons, geese and ostriches are also kept. Poultry production
in the country is conveniently categorized into two; namely; commercial or free-
range. There are wide variations within these two systems in terms of numbers,
types of birds, bio-security and management. The commercial system covers
production with improved hybrid breeds (and recently also with local breeds) under
intensive confined management of uniform stocks and age-groups primarily for
commercial purposes. Categorization may also be based on management systems
i.e. intensive, semi-intensive and extensive or free-ranging system. The intensive
system, which is based on specialized breeds, constitutes less than 20% of the total
poultry population in Uganda. This system is found mainly in urban areas, where
there are markets for eggs and chicken meat. Producers in this production system
aim at using the recommended standard practices, such as breed of choice
depending on production objectives, appropriate housing, feeding and health and
disease control programmes.
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Table 3: Characteristics of Poultry Production in Uganda

Characteristic Commercial Free-range
Intensive Semi-intensive (extensive)
Breed and flock Specialized Specialized and Local indigenous
Size breeds (exotic or dual purpose type: <50
indigenous): 500 breeds: 50 – 500
– 5,000 or more
Housing Modern housing, Varies from Varies from
generally with modern houses bespoke houses,
concrete walls to simple housing owner houses,
and regulated made trees, to
internal from locally nothing at all
environment available
materials
Feed resource Commercially Commercially Scavenging and
compounded compounded, occasional
feeds either by home-made feeding with
self or by millers mixtures and home grains and
free-range household refuse
Health Standard and Disease control No regular health
programme regular poultry and health programme
health programme at of disease control
programme varying levels measures
in place
Markets Varying from Input and output No formal
organized cold distribution marketing
chain system for is based on channels
input-output existing trading
distribution to centres
informal
Infrastructure Water, electricity Modest Under-developed
and infrastructure infrastructure
communication depending on
available proximity to
urban centres
Product storage Varies from Occasional No refrigeration,
and processing refrigerated dressing of birds sales of live
facilities for depending on birds and eggs
dressed birds and marketing
table eggs to chains
none
4.1.2 Sector 1: Industrial and Integrated Production
Intensive poultry farming was introduced in Uganda in the early 1950s, with the
establishment of two government farms at Entebbe and Mbarara. The industry
registered rapid development during the 60s, and the country had started exporting
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poultry products. However, it experienced a sharp decline during the late 70s and
early 80s due to civil strife and political turmoil. Although the industry has not yet
fully recovered, some progress has been achieved during the last ten years (UBOS,
2002). The map in Section 11 shows the distribution of exotic chickens in the
country by 2002 projections with high densities around the capital city Kampala in
the central region.
Currently only one farm (Ugachick) has the very high bio-security measures that
qualify it to be classified as Sector 1 according to FAO. Ugachick is located near the
capital city of Kampala and has major outlets in other main towns such as Jinja and
Mbarara, where they also have “outgrower’ farmers.The birds are housed and have
no contact with other domestic or wild animals, the farm manufactures their own
feed and has a well qualified veterinarian and a number of animal husbandry
experts. They process and/or package their products for both export (DOC) and
urban markets (DOC, poultry meat products, eggs and feeds). They are however
dependent on the open market for inputs, including medicines and vaccines.
4.1.3 Sectors 2 and 3: Other Commercial Production Systems
This system is characterized by a complete indoor housing system with commercial

feeds from either feed suppliers or self-mixed.
The system can be classified into the following categories based on scale of
production:
 Small-scale units categorised under FAO Sector 3. Mainly household/family

owned farms of 100 – 500 layers or broilers or indigenous chickens. It is
not uncommon to find one farmer keeping different types on the same
farm in different houses. These farms are usually run by women with one
or two assistants and much of the labour is supplied by members of the
family.
 Medium-scale units owned by individuals, companies or farmers’ groups,
with a capacity of between 500 – 5,000 layers or broilers and therefore
more specialised in terms of production. This category also includes farms
with a small parent breeding stock and hatching facilities. Bio-security
levels are not high at these units and they would also be categorised as
FAO Sector 3.
 Large scale units which are mainly breeders with hatching facilities and a
capacity of over 5,000. Currently, there are about three in this category,
and only one – Ugachick – would qualify as Sector 1 while the other two
(Biyinzika and Bukomo) would be categorised as FAO Sector 2.
 Breeding farms (hatcheries) whose main commercial activity is keeping
parent stocks and selling of DOC. Almost all of them will also be involved
in keeping commercial layers or broilers as well.
Breeding stocks and hatching eggs

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The main commercial activity of breeding farms (hatcheries) is keeping parent
stocks and selling DOC; almost all of them will also be involved in keeping
commercial layers or broilers. The present national setting capacity for the
hatcheries is 510,000 eggs per week. Table 4 lists the major hatcheries and their
operational capacities.
Most of these eggs come from parent stock farms owned by the hatchery operators.
However, contract hatching eggs production is becoming popular. In addition, due
to the huge demand for DOC, several companies still import DOC and sell directly
sell to farmers.
Table 4: List of hatcheries and their operational capacities

Name Installed Current % No. of chicks
capacity (per utilization (per week)
week)
Ugachick 120,000 100% 90,000
Magigye
Bokomo 40,000 100% 48,000
Biyinzika Seeta 90,000 30% 24,000
Kigo Prisons 40,000 15% 6,000
LES – Entebbe 16,800 40% 5,000
Bulemezi Mukono 13,000 60% 7,000
Kiyita Kasangati 24,000 40% 8,000
Nsambya Catholic 12,000 60% 6,000
Senda – Mukono 11,000 67% 6,830
Kagodo Makindye 40,000 75% 23,000
Walusimbi Kiira 12,000 45% 4,800
Kiwanuka 4,000 50% 1,600
Kabowa
Gesica 12,000 58% 6,000
Namugongo
Others 9,000 _ _
4.1.4 Sector 4: Village or Backyard Production
Chickens
Indigenous poultry are found all over the country though the majority of these birds
are found in the Eastern parts of Uganda (Ssewanyana et al., 2001).
Under free-range management systems, the birds scavenge for their food and seek
shelter in the natural surroundings in trees and bushes. Others are provided with
different forms of housing that vary from staying with the owners in the family
houses to kitchens, in small shelters specifically made for them or roosting in trees.
Indigenous chickens are predominant in villages despite the introduction of exotic

and crossbred types, because farmers are not able to afford the high input
requirements of introduced breeds. In most villages, the birds have no regular
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health control programme, may or may not have shelter, and scavenge for most of
their nutritional needs. They form part of an indigenous and integral part of the
farming system, with short life cycles and quick turnovers, low-input production
systems with outputs accessible at both inter-household and intra-household levels
and a means of converting low-quality feed into high-quality protein.
Poultry in traditional village poultry systems provide scarce animal protein in the
form of meat and eggs, and are available for sale or barter in societies where cash
is not abundant. They are generally owned and managed by women and children.
Village chickens also fulfill a range of other functions for which it is difficult to assign
a monetary value. They are active in pest control, provide manure, are required for
special festivals and to meet social obligations, they are essential for many
traditional ceremonies (such as slaughter for important guests) and traditional
treatment of illness. Any cost-effective strategy that increases the productivity of
these birds will assist in poverty alleviation and the improvement of food security.
The increased availability of village poultry and eggs should result in an improved
intake of protein by the population and increased access to cash and other
resources. Poultry are often essential elements of female-headed and poor
households. This is a particularly important contribution in areas where child
malnutrition is common.
Households keep flocks of between 6 and 20 chickens per household excluding

chicks and growers, with very few keeping over 50 birds. Chicks are hatched and
reared by the hens. There are variations in numbers during the year because of the
occurrence of certain diseases such as Newcastle disease, which wipes out 60-100%
of the birds when it strikes. Farmers therefore sell many of the birds prior to such
disease occurrence in order not to incur losses during outbreaks. This creates
differences in the flock structures at different times of the year and thus the flock
dynamics. Due to the vulnerability of the chicks to several problems of disease and
management, the flock characteristics change the desired flock ratios. These are
also influenced by egg production.
The hens produce about 2-4 clutches a year each of about 10 – 12 eggs (Byarugaba
et al., 2002, Ssewanyana et al., 2003). While egg production and chick survival are
the major determinants of flock productivity, chick mortalities account for very high
losses in most villages (Kirunda and Mukiibi-Muka, 2003). Management practices
that minimise chick losses therefore could be used to increase output from the
scavenging chicken. Egg production also reflects the proportion of mature laying
hens in the flock. The proportion of laying chickens in some studies was on average
24% of the flock. If the proportion of laying hens can be increased, this would
increase egg production and hence output. The hatchability of the scavenging
chicken has been considered to be low. Studies have shown hatchability of between
45-75% (Byarugaba et al., 2002) and this falls within the range reported on other
countries. Some have even reported up-to 100% hatchability. Improved
management such as provision of appropriate nests for laying could help achieve
optimal hatching potential of these birds.
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Women and children play a key role in their day today management (90%) with
very little male participation (10%). Supplementary feeding is sometimes given in
the form of leftovers from household surplus although the broad range of the
available feed resources and in different periods of the year has not been
documented in Uganda. One of the major constraints to village poultry production in
Uganda is undoubtedly the existence of various diseases (Ojok, 1993). The problem
of diseases in village chickens is compounded by the interaction of different entities
that are of significant importance to disease epidemiology. There are uncontrolled
contacts in the villages between birds from different households as well as frequent
introduction of birds from markets, gifts or other purchases. Such birds bought from
markets and wild birds may be a source of infection.
Among the diseases most commonly recognised is Newcastle disease, which has
been ranked the most important (Mukiibi-Muka, 1992). Besides Newcastle disease,
there are also parasites - both external and internal - which are well recognised by
the farmers (Kiddu- Makubuya, 1998, Lubwama, 2002). Some of the parasites such
as stick tight fleas are known to cause serious losses especially in the chicks. In
these villages, local remedies are usually used to treat many of these diseases such
as use of paraffin to clean off external parasites and many herbs for internal
parasites (Kirunda and Mukiibi-Muka, 2003). Because of the virtual lack of extension
services, there is very little modern medicine used in disease control. As a result,
Newcastle disease has continued to wipe out many of the chickens when it strikes,
although vaccines are available. Rearing losses are very severe. It is estimated that
the mortality of indigenous poultry under scavenging conditions is 70% and above
in chicks up to 8 weeks of age (Kirunda and Mukiibi-Muka, 2003). These high
cumulative levels of mortality influence the structure of the flocks whereby 30-50%
of flocks are normally chicks. Efforts to increase productivity through improvements
in health, feeding, housing, genetics and management have been minimal.
Semi-intensive production system (backyard system)
In recent years there has been a development in the extensive system with
improvements in management, housing and flock size, especially in the urban and
suburban middle class. These farmers also follow intensive-based health
programmes for vaccination against common diseases and the general disease
control methodologies practised in the intensive system. In this semi-intensive
system, the birds are housed but have a wire mesh open enclosure where they can
free-range for food. In addition, these birds are provided with good quality water
and supplementary commercial feed. This has become popular with indigenous
breeds which are targeted for the preferential market of indigenous breeds. The
average numbers kept per household in this system are much larger than those
kept under the free-range system per household. Several farmers have organized
themselves into an association called the Uganda Local Chicken Farmers
Association (ULCFA) that helps the farmers in hatching DOC as well offers training in
improved management. The association currently has about 6,000 members in
about 14 districts all over the country. The breeds under this vary from the
indigenous breeds to cross bred as well as pure breeds. There are also variations in
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management under this system. Some still leave the birds to scavenge without
restriction but provide them with supplementary feeds, while others partially
release them under enclosed wire mesh-enclosed compounds. Flock sizes in the
semi-intensive production system are normally from tens to hundreds of birds.
Other species
Some households will also keep other poultry such as turkeys, ducks, geese,
pigeons and guinea fowls. Ostriches are also very popular in the north-eastern areas
of Karamoja.
4.1.5 Poultry Value Chain Analysis
The marketing of poultry in Uganda is not streamlined. Although the objectives of

the PMA focus on increased incomes and market share and directly highlight the
need for an efficient marketing system to enable farmers to gain from increased
productivity, this has not yet been achieved.
Chicken meat
Marketing of local poultry
Whereas free-range poultry meat and eggs are generally perceived to taste better
than broiler meat and commercial layer eggs, their prices are often higher and this
may mean that consumers select from other protein sources available. There are
several other sources of animal protein which compete more favourably in urban
and suburban areas in terms of prices, for example beans, beef, broiler and fish.
Table 5: Prices of free-range chickens in different markets

Market type Average Hen prices Average Cock prices
Ug Shs USD Ug Shs USD
Farm-gate 7,000 3.68 10,000 5.26
price
Primary 9,000 4.74 12,000 6.32
market
Secondary 11,000 5.79 14,000 7.37
market
Urban market 14,000 7.37 17,000 8.95
All male and female members of the household are involved in the marketing of
free-range chicken. The women are involved more at farm gate level while the trade
is mainly male-dominated in markets and in towns. Although there is a weight and
size consideration both at sale and purchase, there is no established means of
verification. Chickens are usually sold live to fellow farmers, retailers or consumers.
The marketing chain (Figure 1) is simple and undeveloped with no market
infrastructure apart from for some stalls in towns. The main marketing channels are
from farmer to farmer or consumer (informal marketing), another is from farmer to
retailer and then to consumers (primary marketing). Some farmers sell direct to
restaurants while others sell to traders who take to secondary markets and urban
areas.
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Figure 1: Simple chicken marketing chain
Consumers
Traders (Wholesalers – Retailers)
Consumers Farmer Retailers Consumers
Restaurants
Consumers
There have been a few studies that have examined the gross margin analysis and
the various beneficiaries in the marketing chain of chickens. The price
competitiveness of the different poultry species and types with other available
alternative sources of protein in the country has also been studied (Mukiibi-Muka
and Kirunda, 2005). The quantity of chickens supplied and sold in the markets is
known to be elastic and to vary significantly with sex and the month of the year.
More cocks than hens are supplied in the markets and large quantities of free-range
chickens are sold in holiday seasons as well during ND outbreak seasons when
farmers prefer to sell them off than lose them to disease. Middlemen play a major
role in the local chicken marketing chain and earn more profit of the total income
generated in the local chicken marketing chain. It is however known that the profit
margins realized by farmers and middlemen were significantly influenced by the
months in which both parties sold chickens and the sex of the chickens, with cocks
earning higher profits than hens.
Factors affecting the marketing of local chicken in Uganda
Seasonal availability of birds
The seasonal effects of price fluctuations depend on festive seasons, crop activities
and disease outbreaks. Thus in a season when crops are likely to be destroyed by
chickens or in a period when ND strikes, most farmers will sell most of their
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chickens (Mukiibi-Muka, 1992). At festive seasons such as Christmas the prices will
be higher due to increased demand.
Transportation
Since there is no specialized transport of live chickens, the birds are bundled
together either on strings or baskets and are transported on different means of
public transport available such as motorcycles, lorries, buses or mini-buses together
with passengers. Such kind of transportation is a risk factor for possible
transmission of zoonotic infections.
Retailer output
When the retailer is selling roasted pieces of chicken, all pieces cost the same
irrespective of the original size of the hen or cock. The output of the retailer will
determine the type of chickens such retailers will buy.
Disease outbreaks
This affects both farmers and middlemen. When disease breaks out in an area,
farmers will panic and sell their chickens cheaply. Similarly, the middlemen who buy
the chickens cheaply may also lose a number of them due to disease.
Lack of information on prices
The farmers depend on information given to them by traders and often the traders
will want to maximize their own profits by offering as low a price as possible.
Lack of streamlined marketing channels
Although farmers get information that chickens may fetch high prices in towns or if
they sold to institutions, they lack the capacity and economies of scale to gather
enough stock for such a transaction.
Marketing of commercial poultry and their products
The marketing of commercial broilers or eggs as well as other products is more

complex. Some of the broiler and layer farmers have over time established reliable
clientele such as hotels, restaurants or roadside roasted chicken sellers or
middlemen who will always pick the products from the farms and transport them to
the consumer points or to secondary retailers. Others also deliver the products
directly to their clientele.
Some more organised companies such as Ugachick have introduced a contract

farming scheme whereby farmers are given either broiler or layer DOC and pay as
they get the returns back. Such systems help establish a clientele for the company
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and the farmers are also given support for their business in terms of training in
poultry management and vaccinations. Some even sell their products back to the
company for processing and subsequent marketing. Previously, the company
produced all their broilers which they processed and packaged for sale but they
introduced the contract farmers system as they realised that they would not sustain
the rearing business. At the moment, the contract farmers take over 20,000
chickens per month. Besides the extension services provided by the company (such
as visits by company veterinarians) the farmers are also assured a ready market for
their produce.
5.0 TRADE, MARKETING AND MARKETS
5.1 Trade, Marketing and Markets for Poultry in Uganda
5.1.1 Domestic Market
Types of markets
Informal markets
These operate within the villages involving farmer to farmer or to retailers. Although
the main purpose of selling is to raise income, sometimes fellow farmers who need
a certain hen or cock for breeding may demand the purchase from a neighbor.
Some farmers give their chickens to children to take to the roadside for sale in
areas where there are main trunk roads. Often chickens are bartered for larger
animals such as goats.
Primary markets
These are generally formed by several villages within a local area and are held on
gazetted days of the week. They are often in fenced areas with few or no facilities.
Traders may purchase chickens from several adjacent primary markets and
transport them to destinations within or outside the country. This is where the
majority of the rural farmers go to sell their chickens and also to buy various
household items from the income.
Secondary markets
Secondary markets normally have a larger throughput than primary markets but
also lack proper weighing, loading and hygienic facilities. Traders often come with
trucks to buy a full load of chickens for immediate transportation to large centres
such as Kampala. Animals are sold according to size, age and appearance through
negotiations between sellers and butchers/traders/farmers. The number of farmers
at secondary markets is small and is comprised of those who are close to the
market. The level of taxes and those involved is also increased at this type of
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market. Sometimes the sellers are disadvantaged because there may only be a few
traders present with whom to negotiate and because they normally do not know the
prices of livestock in the urban centres. In addition, they are often selling under
pressure, such as the need to meet an immediate cash need and they do not want
to risk losing a sale. However, in the districts where large numbers of animals are
available for sale and more traders exist, sellers are better able to bargain for fairer
prices.
Urban markets
These are in larger towns and cities and there are often designated areas where
makeshift chicken stalls are erected. Suppliers to such markets are traders who buy
from secondary markets, place chickens on trucks and take them to towns.
Consumers from such urban markets are hotels, restaurants and some affluent city
dwellers. An ordinary farmer or consumer is not likely to buy from such a market
because the prices are higher except on festive days like Christmas.
5.1.2 Import
All the hatcheries import their parent DOC from outside Uganda, as there are no
grandparent stock farms in the country. These are imported from various countries
including Holland, Mauritius, Kenya, Zimbabwe, UK, USA, France and Germany.
Imports from a number of these countries especially in Europe such as UK and
Germany, France, Holland were temporarily banned during the peak of HPAI H5N1
in Europe to prevent entry of the virus through imports. These import restrictions
have since been lifted but there is continuous monitoring and the ban may be
imposed at any time. MAAIF periodically reviews the countries from which imports
are allowed and issues import restrictions which are implemented through
requirements for import permits of poultry or poultry products enforced by law.
5.1.3 Slaughtering Facilities
In terms of processing, only Ugachick has a slaughter plant. The rest of the
slaughter is carried out in make-shift small slabs or in households or restaurants.
The products therefore may not be professionally handled, resulting in a lack of
grades and standards, inadequate market information and un-standardized
products being presented to consumers.
5.1.4 Poultry Feeds
Poultry feeds under the commercial system constitute the highest cost of
production, accounting for 60–70% of costs, particularly in intensive production
systems. Several feed millers provide the farmers with already mixed feeds.
However, because of the lack of sufficient regulatory policies, there have been
issues with quality and most farmers have therefore resorted to buying the
ingredients and mixing the feeds themselves. This is also usually a cheaper option.
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Besides the commercial feed factories there are several up-and-coming small-scale
feed producers which are not mechanized but nonetheless play a large role in
supplying feed to the various categories of poultry farmers.
Table 6 below shows the major feed mills producing poultry feeds for commercial
purposes.
Table 6: List of commercial feed factories in Uganda

Name Installed Capacity Present Production
Creda Africa 40 mt/wk Not known
Liberty Trading Co. Ltd. 200 mt/wk Closed
Formula Feeds 40 mt/wk 15 tons per week
Catholic Secretariat 42 mt/wk 6 tons/wk
Engano Millers Ltd. 60,000 mt/wk 1,100 MT/annum
Bulemeezi Farm 32 mt/day 5 tons/day
Enterprises
Ugachick Poultry 10 MT/day 6-7 MT/hr
Breeders
Kagodo Farm 45 tons/day 20-22 tons/day
Hill Top 1.5 MT/hr 1.5 MT/hr
While poultry feed production has increased from 32,000 MT in 1993 to the current
production of 80,000 MT, the present capacity utilization is still low at around 40
-45% of installed capacity. Most feed factories are located in and around Kampala
and Jinja far from areas of high cereal and other input production. Since most inputs
and poultry feeds themselves are bulky, transport makes the final products
expensive. The output of feed mills varies considerably from season to season,
resulting in irregular supplies and prices for farmers. Quality is inconsistent between
various manufacturers and also within the same company from season to season.
Generally, there is a lack of technically qualified staff in feed processing and
laboratory facilities for regular quality monitoring. The feed regulatory act has not
yet been enacted by parliament.
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6.0 FARM MANAGEMENT
6.1 Poultry Farm Management
6.1.1 Day Old Chicks
The chicks that will be purchased by ERIC MUGUME’S EGG PRODUCTION

ENTERPRISE for the purpose of setting up the farm will be of uniform size, active,
alert and bright eyed. The shank or leg covering (skin) of healthy chicks appears
bright and shiny. These improved and high yielding chicks will be purchased from
reputed farms.
6.1.2 Space Requirements
Coop design necessitates 2 square feet per bird. Therefore, a 2000-bird flock would
need two (2), 2000 square foot (186 square meter) coops. building design calls for a
building 20 feet wide and 100 feet long, plus an additional 5 to 10 feet in length for
a storage room. The length storage room can be tailored to needs of the location.
6.1.3 Scope
The poultry operation will consist of an initial coop capable of housing 2,000 birds
(pilot project unit). Subsequent coops will be capable of housing 500-to-600 birds.
The two tiers allow the project to experiment with different levels of risk. The issues
of disease management, temperature control, and predator theft (human and
animal) are key in this design decision.
6.1.4 Brooding
Proper brooding temperature is required to keep the chicks in comfort during

rearing period when they are sensitive to cold and need some artificial heat source
to maintain their normal temperature. Charcoal or sawdust is burnt for supplying
heat at the stage of brooding in the poultry farm.
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The Business Plan has taken a brooding expense at UShs. 100 per bird during the
rearing period.
6.1.5 Feeding
The requirement of feed during lying depends on the rate of egg production and the
body weight of layer birds. The actual feed consumption may be influenced by
several factors as follows:
• Body weight of the bird.
• Rate of egg production.
• Season and weather condition.
• Health and physical condition of the bird.
• Feed quality such as protein contents, caloric value of feed, etc.
Generally the feed intake increases with an increase in egg production.
Feed should be distributed simultaneously to the entire flock. Otherwise, birds lower
in the pecking order will be crowded out and will not get enough feed, while large
birds will over-consume.
6.1.6 Housing
The poultry house has been designed and constructed so as to be well ventilated,
cheap, durable, comfortable and safe. Each bird has been provided a floor space of
about 1.5 to 2 sq. ft. The calculations in the Business Plan are based on an area of
1.75 sq. ft. per bird.
Coop Architectural Designs
The three (3) diagrams shown below display the design concept that is considerd
most appropriate for this level of poultry egg production facility.
Figure 2: Standard Chicken Coop (Front View)
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Figure 3: Standard Chicken Coop (Rear View)
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Figure 4: Standard Chicken Coop (Basic Plan Diagram)
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6.1.7 Feeders
It is essential to provide adequate feeder space. Ideally, two pan type feeders are
sufficient for 50 birds. Therefore, for a total of 2,000 birds, 40 feeders are enough.
6.1.8 Nests
Birds need privacy when laying the eggs. The glistening and shiny appearance of
the wet egg can trigger cannibalism against the egg and against the hen laying the
eggs. 4 birds can share a nest; each nest is about 2 ft x 2 ft. A 2000 bird flock would
need 500 nests. Nests can be double-stacked and run along both the sides and
center of the coop.
6.1.9 Lighting
Light affects growth and reproduction of birds by different physiological actions.

The duration of the light period should not be decreased during laying period.
Adequate lighting boosts up egg production by 5 to 10 percent. Lighting encourages
the birds to eat more feed, more of which will lead to better growth and more eggs
production. Irregular lighting results in drop in egg production.
Young birds need dark conditions, while mature birds lay more eggs with increased
light. The birds sense light through their skulls, not just their eyes. The maturation
process is enhanced by managing the light. Due to these factors, the ability to
control light is desirable and should be incorporated in the design and construction
of the barns.
6.1.10 Temperature Control
Natural ventilation and cooling is critical in considering temperature control through

coop design. In cold climates or higher elevations, temperature control will require
heating systems. (Heating systems are also required for the arrival of day-old
chicks.)
6.1.11 Insulation
To hold down the roof temperature and prevent heat radiation during sunny days, it
is necessary to insulate the roof to an R-value of 5. Material like 1-inch-thick foam-
type insulation with hard fiberglass (or similarly durable material) glued to the lower
side should prevent birds and other critters from pecking or chewing away material
from the underside of the roof. A thatched roof could provide an effective R-value.
6.1.12 Ventilation
An effective method for ventilation would be a continuous 6-inch-wide ridge opening

running the length of the building. To prevent rain from entering the coop, the ridge
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opening should be capped with a small roof-type structure that is 12 or 14 inches
wide, located 12 inches above the ridgeline. This will allow warm air to exit the
opening without being restricted by this ridge cap.
6.1.13 Drinkers
Adequate drinking space should also be provided to the birds. It is necessary to

provide extra water during extremely hot weather. The drinker should contain fresh,
clean and cold water.
A continuous supply of water is vital for layers. Nipple drinkers are ideal for
preventing disease; a ratio of 1 nipple per 15 hens is preferred.
Capturing rainwater reduces labor and may be essential if the coop is located far
from a well. Rain barrels will collect and hold water from the roof during storms.
This storage tank will be connected to an interior nipple drinker system. Excess
water could also be channeled into a drip irrigation system for a garden around the
coop.
6.1.14 Litter
Litter is spread on the floor to prevent the direct contact with the floor. Straw,
coffee-husk and sawdust are generally used for making the litter. It should be dry
and free of moulds. Caked or moldy material should be removed and refilled with
fresh materials. Extensively wet and dusty litter should also not be used. Using new
litter for each flock is good for raising disease-free broilers and layers. Litter can
also be resold in the market.
6.1.15 Vaccination
Vaccination can be applied to chicks through injections. The medicine can also be
mixed in the water and also through eye drops. Vaccination is provided to the birds
once in the rearing period and once in the laying period. Average vaccination cost
per bird usually varies between UShs. 200-400. The Business Plan has taken
vaccination cost at UShs. 300 per bird.
6.1.16 Fumigation & Spraying
It is essential to check all equipment and walls of the broiler house carefully that
they are clean, and washed with disinfectant solution, and dried. The rooms should
be white washed and sprayed before the arrival of birds.
Disinfectant solution can be prepared with Phenol, Potassium Permanganate,

Carbolic Acid and Formaline. A solution of Sodium Hydroxide/Caustic Soda with
warm water can also be used to clean the house.
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To sanitize the broiler and layer houses from germs and insects, they are fumigated
with Formaldehyde Gas, which is produced by putting Formaline on Potassium
Permanganate. The rooms are first vacated and then sealed for 30 minutes after
the fumigation so that the gas infiltrates in every corner of the room.
In the Business Plan report, the cost of fumigation has been taken as UShs. 200,000
per flock.
6.1.17 Floor
Concrete is the preferred flooring material for coop designs. A separate roost area
helps manage the waste products. It is preferable to avoid hard woodchip floors.
6.1.18 Isolation
Coops should be in a relatively isolated part of the village, as isolation is imperative

for mitigating the risk of disease outbreak. Therefore, it is advised to keep the coops
in the back of the village, away from roads, paths, and other highly trafficked areas.
Human traffic should be limited to as few people as possible; ideally only 2 or 3
people would ever have access to the coops. In addition to limiting human traffic, it
is vital to limit the exposure to wild animals. Sturdy building, as well as tree-
trimming above the coop, will reduce the chances a wild animal will enter or
contaminate the coop. Finally, ventilation is an important consideration; building the
coop in an open area will facilitate natural ventilation.
6.1.17 Culling
Culling is the procedure of selection and rejection of unproductive and poor

producers. Culling is a very important job for running layer farm profitably. Poor
layers should be culled to minimize the cost of production. The birds that have laid
well for short period but have stopped laying for one reason or another should be
culled out. Sales price varies in a range of UShs.3,500 to 5,000. In the feasibility
study the culled birds are sold at a rate of UShs. 4,000 per bird.
6.1.18 Rearing and Laying Schedule
The cycle of one flock of layer farm is divided into two distinct phases, the rearing
phase and the laying phase. During the rearing phase of 6 months, the birds
consume feed and are non-productive. After the rearing phase is over, the birds
start laying eggs and remain productive for the next 12 months. So, the revenues
and costs occur in the form of cycles. The schedule for this calculation for the first
ten years of operation of the farm is shown in Table 7.
Table 7: Schedule for Calculation of Revenues and Expenses (1 – 2 Years)

Yea Rearing Laying Frequency per year
r Months Months Birds Birds Litter Litter Spray Vaccination
Sale Purchase Sale Purchase Cost Cost
d d
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1 6 6 0 1 1 2 2 2
2 5 6 1 1 2 2 2 2
7.0 MANPOWER REQUIREMENTS
Semi skilled workers are needed to look after the feeding, vaccination and cleaning
operations at the farm. A single person can handle 1,000 birds easily. Two people
will therefore be hired to manage the operations of a layer farm of 2,000 layer birds.
Each attendant will be given a monthly salary of UShs. 100,000. Hence, the reason
why the total monthly labour cost is indicated as UShs. 200,000 per month.
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8.0 OPERATIONS
8.1 Bird Selection
Day old chicks are readily available through a number of local breeders – Ugachic
Poultry Breeders, Bokomo, Biyinzika Seeta, Kigo Prisons, Livestock
Experimental Station (LES) Entebbe, Bulemezi – Mukono, Nsambya
Catholic, etc. as well as from the neighboring Kenya.
8.2 Feed Supply
The availability of feed is perhaps the most integral factor impacting the success of
any poultry egg production project. It is critical to have a dependable source of
high-quality feed. Often, local feed mills will produce a variety of feeds and can
advise as to which local variety is best for the current lifecycle of the bird. In terms
of operational profitability, it is essential to analyze and control the cost of feed.
In addition to price, quality is very important, with heavy emphasis on the protein
content. Ideally, feed should have about 20% protein; other minerals and vitamins
can also enhance the feed performance. Gold’n Plump can do testing of feed
nutrients.
Ideally, the project would do well to have its own feed mixing model, which will
reduce the cost of feeds by about 25%.
Feed consumption will increase as the birds age.
8.3 Veterinary Care
There is na imperative need for this project’s management to cultivate and maintain
strong working relationships with both private and government veterinarians and
extension workers. Locally available veterinarian care services are crucial in caring
for the chickens. An experienced vet is a valuable asset for maintaining bird health
and training. The vet should be capable of procuring and administering vaccines.
8.4 Training
Comprehensive training successfully addresses brooding practices; feed and

feeding practices; factors impacting growth and development of chickens; factors
impacting the egg production; disease recognition and management; molting
management; and record keeping and accounting principles. These areas are
covered in this document, but firsthand training will greatly help the success of the
project.
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9.0 PRODUCTION PLAN
9.1 Land, Buildings and Facilities
9.1.1 Land Availability
The chicken coops will be built on property currently owned or available to the
principal project promoter – Mr. Eric Mugume. The existing land and structures on
it will be a useful starting point for the implementation of this project and are
entirely out of the efforts and hard work of the project promoter – Mr. Eric
Mugume.
9.1.2 Existing and Planned Structures
Table 9 below provides a breakdown of area (in square feet) and corresponding
value (in UShs.) of the existing and planned poultry farm structures at ERIC
MUGUME’S EGG PRODUCTION ENTERPRISE.
Table 8: Space dimensions and financial value of existing and planned

poultry farm structures
Particulars Specifications Physical Unit Total Cost

Units (Sq. Cost (UShs.)
ft.) (UShs.)
Management building 180 sq. ft. 180 sq. ft. 10,000 1,800,000
Store room 70 sq. ft. 70 sq. ft. 6,000 420,000
Shed space for layers 2 sq. ft./bird 4,000 sq. ft. 600 2,400,000
TOTAL 4,250 sq. 4,620,000
ft.
Building Cost Estimates
Obviously, the construction costs should be minimized. Effective ways of doing this
is by the use of local material and traditional construction techniques. The building
plans put forth in this document are mainly to outline design elements Therefore
adapting the design to local build customs is appropriate.
9.1.3 Infrastructure Facilities
Poultry's farming needs to be handled tactically, right from the selection of the site
to the final stage when the birds are sold. That being the case, the selection of the
farm at Kichwamba was done in such a way to ensure that the transportation of
birds and feed can be always be easily handled.
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The entrepreneur will try his level best to ensure that the following things are
available at the farm site before gearing up to full production parameters:
• Electricity connection
• Drinking quality water
• Road access
• Drainage of rain water
9.2 Farm Equipment
Various types of farm equipment are needed for feeding, drinking and handling the
birds. List of the required farm equipment is given in Table 9:
Table 9: Farm Equipment for Layers

Layer Farm Equipment Unit Unit Cost Total Cost
(UShs.) (UShs.)
Brooders 20 20,000 400,000
Drum Heaters 2 40,000 80,000
Nipple Drinkers 140 6,000 840,000
Feeders 40 4,000 160,000
Nests 500 2,000 1,000,000
Shifting Box 10 50,000 500,000
TOTAL 832 2,980,000
9.3 Location
The precise location of the ERIC MUGUME’S EGG PRODUCTION ENTERPRISE is

------- kms off the Kampala – Entebbe main road makes it suitable for setting up an
enterprise of this nature since an isolated place will minimize the risk of disease
outbreaks among the piggery hear and poultry flocks on the farm.
Also, given the farm’s close proximity to the main road and Kampala City and
Entebbe town will enable the enterprise to have a quick communication with the
market for the purchase of farm inputs (feed, drugs, etc.), and the selling of
marketable poultry eggs.
On balance therefore, the relative isolation of the poultry egg production farm as
well as its proximity to the highway and major urban centres in Central Uganda
reduce the risk of disease and also facilitate the fast acquisition of farm inputs and
marketing of its outputs at the same time.
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10.0 EXPANSION
This section specifically highlights on the deliverables and tracks the variables to be
expected on the planned route for expansion of this poultry egg production
enterprise over the medium- to long-term course.
10.1 Phase 1
Construct a modern and viable poultry egg production facility capable of housing a
flock of 2,000 birds. The goal of this phase is to test hypotheses formed from the
poultry experience that the principla project promoter already has in the field. This
phase also includes the cost of training and refining operations. The cash flow
model and development goals will be re-evaluated based on the output of this
experiment.
Estimated cost for Phase 1 = Ushs. 64.6 million
10.2 Phase 2
The goal of this phase is to expand the scale of operation by the construction of four
additional coops and further enhancements. The rate and scale of this expansion
depends on the results from Phase 1. As these questions are answered, the plan can
be adjusted and modified as the operation is expanded.
Greater production capacity can be achieved by constructing multiple coops,

which will enable the economies of scale to drive down production costs. Redundant
coops will also allow the project to more reliably serve its customers, especially as
older flocks are replaced—or in case a flock dies due to disease outbreak. Phase 2
allows the main project beneficiarie to scale up poultry production by building
multiple coops and to focus on this as a major economic activity.
This phase could, in part, be financed by cash flows from the first coop, or
perhaps the manager could take a loan.
Estimated cost for Phase 2 (per coop) = Ushs. 24.0 million – Ushs. 36.0 million
10.3 Phase 3
Phase three focuses on incremental improvements in laying performance. This can

be achieved through additional investments in barn equipment, specifically by
adding automated lights and feeders. Strict lighting and feeding programs can
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greatly increase laying performance. Additional investment can be made in
effective ventilation, which helps to reduce bird stress.
The cost of Phase 3 is highly variable and is to be implemented as a continuous
improvement campaign.
10.4 Phase 4
The success of this proposed poultry egg production project and its promoting
entrepreneurs will represent qualified business partners and investment
opportunities for established poultry ompanies seeking to expand their international
operations. This success should therefore present any egg-production international
company a filtering process allowing it to develop a relationship before investing
large amounts of time or money in the enterprise.
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11.0 PROJECT ECONOMICS
Table 10: Project Economics
Account Head Total Cost

(UShs.)
Land 20,000,000
1 Pick-up Vehicle 20,000,000
Purchase of 2,000 Layer DOCs (Day Old Chicks) @ 2,250/= 4,500,000
Total Fixed Costs 52,100,000
Total Working Capital 12,488,399
Total Project Cost (UShs.) 64,588,399
Table 11: Financing Plan
Initial Financing UShs. In Actuals

Loan 37.92% 24,488,399
Equity (Personal Contributions) 62.08% 40,000,000
Table 12: Loan Disbursement Plan
Project Investment Item Loan Financing

Amount (UShs.)
Purchase of 2,000 Layer DOCs (Day Old Chicks) 4,500,000
TOTAL 24,588,399
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12.0 KEY SUCCESS FACTORS
• Farm Management
Layers
Professional farm management is the key success factor to increase the birds’
productivity. The farm labour is experienced enough to look after the
biological/disease matters of the farm. Timely feeding and vaccination is only
possible if some person is available at the farm 24 hours a day.
• Market Information
Layers
Sale price of eggs may sometimes fluctuate during a year. The entrepreneur should
be well aware of this price fluctuation. This will help the entrepreneur to negotiate
well the sale price of eggs.
• Vaccination and Medication
Layers
Mortality is the most critical component in determining the viability of a Layer farm.
Some times the epidemic diseases results in heavy mortality of up to 25%. Proper
vaccination and medication is very helpful to reduce the mortality loss up to 10%.
• Mortality Losses
Mortality can only be controlled if the farm conditions are hygienic. Mortality losses
should be kept below 8% by timely vaccination & medication.
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13.0 THREATS FOR THE BUSINESS
• Price fluctuations in the market
Layers
Egg prices are determined by supply and demand phenomenon in the market.
• Disease Epidemics
Layers
Mortality is the most alarming threat to the viability of the farm. In this regard, Bird
flu is considered to be the most fatal issue, according to a study, during Bird Flu
40% of the investors withdraws their investment from the industry.
• Shelf Life
Layers
Egg is a perishable commodity and cannot be stored for a long time at the room
temperature. It needs to be either sold within short time or has to be stored at a
cool temperature.
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14.0 PROJECT FINANCIAL ANALYSIS
14.1 Liquidity
The project’s liquidity position of ERIC MUGUME’S EGG PRODUCTION

ENTERPRISE is found to be of a generally sound performance. The poultry egg
project’s cash inflows and outflows are shown in its 3-Year Net Income Statement
(Annexure 1). The Projected Net Income Statement (Annexure 1) also
indicates a viable and lively liquidity position – especially from the second year of
the poultry egg production project.
14.2 Profitability
From Annexure 1, the profitability position of the project is found to be quite

robust and healthy with a steadily rising Cumulative Retained Earnings position
building up from UShs. 15,959,623 [Month 12] to a good cumulative retained
earnings position of UShs. 51,405,798 million by the end of the 36th Month of the
projected period.
14.3 Overall Financial Viability
As already indicated by the project’s 3-Year Net Income Statement, and also based
on projections drawn against conservative and prudent assumptions, ERIC
MUGUME’S EGG PRODUCTION ENTERPRISE would be a worthwhile investment
that is bound to be profitable, liquid and secure – and therefore worth its every dime
in credit support.
The highlights of the mixed project farm’s viability can be enumerated as:
o Very profitable and stable (especially in the second year after it has gained
production and market stability)
o Medium – High real returns
o Healthy cash flows
o Easy operations with low overheads
o Good improving balance sheet

14.4 Cash Flow Model Assumptions
37
Corporate Document
Our cash flow model makes a few material assumptions as listed below.
1. The cash flow is after factoring variable costs, such as labour, transportation,
supplies, and weekly savings.
2. No consumption factor by the project promoter was factored into the
analysis.
3. A typical layer, in conditions of the Project, will produce 4 or 5 eggs per week,
averaged over its lifetime. Actual performance will decline with age. See
Appendix (Layer Performance Graph, Page 43).
4. The layers should be sold once cost of feed for the hens amounts to more
than the revenue produced in eggs, typically occurring at about 80 weeks.
14.5 Internal Accounting and Audit Controls
Ensuring:
 Both accounting and auditing internal control systems will be pursued by this
mixed farming enterprise to their accuracy and correctness.
 Documents leading to the receipt and the release of both financial and non
financial data will be released timely and regularly.
 Internal audit systems have been put in place.
 Money collected will be banked intact.
 Making use of financial institutions’ facilities.
 Restrict unnecessary use of funds/extravagance and giving credit facilities to
suppliers.
Financial Projection Summary
It is important to know the total amount of cash that is needed before the birds start
laying eggs, because if the beneficiaries do not have adequate funds to purchase
feed or veterinary care, then the long-term performance of the flock could be
compromised. It is imperative to keep the following factors in mind:
1. To maximize cash flow, feed cost needs to be minimized and egg price needs
to be maximized.
2. Feed quality cannot be sacrificed, Long-term, it would be wise to investigate
methods for creating feed supplements. (For example, sunflower mash has
excellent potential to be used as a feed component and would dramatically
reduce the feed costs).
3. Theft and excessive yield loss are major risks to the operation.
14.6 Conclusion and Recommendation
ERIC MUGUME’S EGG PRODUCTION ENTERPRISE project’s profitability status is

found to be good with a sound and fast-improving liquidity position. This project will
offset all it financial obligations and responsibilities without any financial difficulties.
38
Corporate Document
ERIC MUGUME’S EGG PRODUCTION ENTERPRISE is thus found to be technically

feasible, financially viable, socially and economically desirable and beneficial and
thus deserves all the support that it can muster to realize its commercial goals and
objectives.
15.0 KEY ASSUMPTIONS
Table 13-1: Production Assumptions

Maximum Capacity Utilization 100%
Number of Birds in Layers Foundation Stock (1 – 6
months) 2,000
Number of Birds in Subsequent Layer Flocks (7 – 36
months) 2,000
Number of Flocks per Year (Layers) 1
Total Mortality Rate 7.3%
Mortality Rate (Rearing Period) 2%
Mortality Rate (Laying Period) 5.3%
Total Mortality Loss (Birds) 146
Total Number of Birds Laying Eggs (Foundation Stock) 2,000
Total Number of Birds Laying Eggs (Subsequent Flocks) 2,000
Length of Rearing Period (Months) 5
Length of Laying Period (Months) 13
Lag time between the Flocks (Weeks) 4
Table 13-2: Economy Related Assumptions

Electricity growth rate 10%
Wage growth rate 5%
Table 13-3: Expense Assumptions

Administrative overheads (% of Sales) 0.5%
Raw material price growth rate 5%
DOC Cost (Day Old Chicks – Layers) – UShs. 2,250
Weight of Feed Bag (Kg) 100
Rearing Period (0 – 8 weeks) Feed
Consumption/Bird/Month (Kg) 1
Rearing Period (0 – 8 weeks) Cost of Feed/Bird/Month–
UShs. 350
Rearing Period (9 – 20 weeks) Feed
Consumption/Bird/Month (Kg) 2.33
Rearing Period (9 – 20 weeks) Cost of Feed/Bird/Month–
UShs. 817
Laying Period (21 – 75 weeks) Feed
Consumption/Bird/Month (Kg) 3.0
Laying Period (21 – 75 weeks) Cost of Feed/Bird/Month–
UShs. 1,050
Vaccination Cost per Bird – UShs. 300 (layers)
Spray Cost per Flock – UShs. 200,000
Utilities (Electricity + Water) Expenses per Month– UShs. 500,000
Brooding Expense per Bird – UShs. 100
Transport Expense per Month – UShs. 300,000
Packaging Materials Cost (per Tray) – UShs. 500
39
Corporate Document
Sales & Marketing Expenses per Month – Ushs 300,000
Miscellaneous Expenses per Month – UShs. 400,000
Buildings depreciation factor 5%
Poultry equipment depreciation factor 10%
Table 13-4: Revenue Assumptions:

Number of eggs laid/Bird/Month 22.5
Production Output in Year 1 (Trays) 10,855
Eggs selling price (per Tray) 4,500
Off-layers selling price (UShs./bird) 4,000
Litter selling price (per Flock) 100,000
Sales price growth rate 10%
Table 13-5: Cashflow Assumptions:

Raw Material Inventory (Days) 40
Accounts Receivable Cycle (Days) 30
Table 13-6: Financial Assumptions:

Loan 37.92%
Equity 62.08%
Short-Term Financing tenure (Years) 3
Minimum Cash Balance 2,000,000
40
Corporate Document
41
Annexure 1: ERIC MUGUME'S POULTRY PROJECT - PROJECTED NET INCOME STATEMENT (USHS) –
YEAR 1
MONT
H
Item 1 2 3 4 5 6 7 8 9 10 11 12
Total Chickens (1st Flock) 1,995 1,987 1,978 1,969 1,961 1,953 1,944 1,936 1,927 1,919 1,911 1,902
Total Chickens (2nd Flock) 0 0 0 0 0 0 0 0 0 0 0 0
Egg Sales (Trays) 0 0 0 0 736 1,465 1,458 1,452 1,445 1,439 1,433 1,427
Off-layer Sales (Nos.) _ _ _ _ _ _ _ _ _ _ _ _
CASH INFLOWS
20,000,00
Start-up Working Capital 0 0 0 0 0 0 0 0 0 0 0 0
3,312,0 6,591,3 6,561,0 6,534,0 6,503,62 6,476,62 6,449,62 6,419,25
Egg Sales (Ushs) 0 0 0 0 00 75 00 00 5 5 5 0
Off-layer Sales Ushs) 0 0 0 0 0 0 0 0 0 0 0 0
20,000,0 3,312, 6,591, 6,561, 6,534, 6,503,6 6,476,6 6,449,6 6,419,2
Total Inflows 00 0 0 0 000 375 000 000 25 25 25 50
CASH OUTFLOWS
Purchase of Layer DOCs 4,500,000 0 0 0 0 0 0 0 0 0 0 0
1,616,0 1,608,6 1,602,1 2,050,6 2,041,2 2,032,8 2,023,35 2,014,95 2,006,55 1,997,10
Feeds (Layers) 698,250 695,450 26 73 37 50 00 00 0 0 0 0
Brooding Expenses 200,000 0 0 0 0 0 0 0 0 0 0 0
Admin. Overheads 0 0 0 0 16,560 32,957 32,805 32,670 32,518 32,383 32,248 32,096
200,00 200,00 200,00 200,00
Labour (Production Staff) 200,000 200,000 200,000 200,000 0 0 0 0 200,000 200,000 200,000 200,000
Vaccination Cost 600,000 0 0 0 0 0 0 0 0 0 0 0
Spray Cost 200,000 0 0 0 0 0 0 0 0 0 0 0
500,00 500,00 500,00 500,00
Utilities (Electricity + Water) 500,000 500,000 500,000 500,000 0 0 0 0 500,000 500,000 500,000 500,000
300,00 300,00 300,00 300,00
Transport 300,000 300,000 300,000 300,000 0 0 0 0 300,000 300,000 300,000 300,000
368,00 732,37 729,00 726,00
Packaging Materials 0 0 0 0 0 5 0 0 722,625 719,625 716,625 713,250
300,00 300,00 300,00 300,00
Sales & Marketing Expenses 300,000 300,000 300,000 300,000 0 0 0 0 300,000 300,000 300,000 300,000
Interest
Financial Charges
400,00 400,00 400,00 400,00
Miscellaneous 400,000 400,000 400,000 400,000 0 0 0 0 400,000 400,000 400,000 400,000
Insurance (6% of Flock
Costs) 270,000 0 0 0 0 0 0 0 0 0 0
Depreciation of Assets 54,917 54,917 54,917 54,917 54,917 54,917 54,917 54,917 54,917 54,917 54,917 54,917
8,223,16 2,450,3 3,370, 3,363, 3,741, 4,570, 4,557, 4,546, 4,533,4 4,521,8 4,510,3 4,497,3
Total Outflows 7 67 943 590 614 899 922 387 10 75 40 63
Net Profit 11,776,8 - - - - 2,020, 2,003, 1,987, 1,970,2 1,954,7 1,939,2 1,921,8
33 2,450,3 3,370, 3,363, 429,61 476 078 613 15 50 85 87
67 943 590 4
11,776,8 9,326,4 5,955,5 2,591,9 2,162,3 4,182,7 6,185,8 8,173,48 10,143,7 12,098,4 14,037,7
CASH BALANCE B/F 0 33 66 23 33 19 95 73 6 01 51 36
- - - -
11,776,83 2,450,36 3,370,9 3,363,5 429,61 2,020,4 2,003,0 1,987,6 1,970,21 1,954,75 1,939,28 1,921,88
NET CASH BALANCE 3 7 43 90 4 76 78 13 5 0 5 7
11,776,83 9,326,46 5,955,5 2,591,9 2,162,3 4,182,7 6,185,8 8,173,4 10,143,7 12,098,4 14,037,7 15,959,6
CASH BALANCE C/F 3 6 23 33 19 95 73 86 01 51 36 23
Annexure 1: ERIC MUGUME'S POULTRY PROJECT - PROJECTED NET INCOME STATEMENT (USHS) - YEAR 2
MONT
H
Item 13 14 15 16 17 18 19 20 21 22 23 24
Total Chickens (1st Flock) 1,894 1,886 1,878 1,869 1,862 1,854 0 0 0 0 0 0
Total Chickens (2nd Flock) 0 0 0 0 0 0 1,995 1,987 1,978 1,969 1,961 1,953
Egg Sales (Trays) 1,421 1,415 1,409 1,402 1,397 1,391 0 0 0 0 736 1,465
Off-layer Sales (Nos.) _ _ _ _ _ 1,854 _ _ _ _ _ _
CASH INFLOWS
6,365,25 6,338,25 6,307,87 6,284,25 6,257,25 3,312,00 6,592,50
Egg Sales (Ushs) 6,392,250 0 0 5 0 0 0 0 0 0 0 0
7,416,00
6,392,25 6,365,2 6,338,2 6,307,8 6,284,2 13,673, 3,312,0 6,592,5
Total Inflows 0 50 50 75 50 250 0 0 0 0 00 00
CASH OUTFLOWS
4,500,00
Purchase of Layer DOCs 0 0 0 0 0 0 0 0 0 0 0 0
1,485,22 1,478,92 1,471,83 1,466,32 1,460,02 1,616,02 1,608,67 1,602,13 2,050,65
Feeds (Layers) 1,491,525 5 5 8 5 5 698,250 695,450 6 3 7 0
Brooding Expenses 0 0 0 0 0 0 200,000 0 0 0 0 0
Admin. Overheads 31,961 31,826 31,691 31,539 31,421 68,366 0 0 0 0 16,560 32,963
Labour (Production Staff) 200,000 200,000 200,000 200,000 200,000 200,000 200,000 200,000 200,000 200,000 200,000 200,000
Vaccination Cost 0 0 0 0 0 0 600,000 0 0 0 0 0
Spray Cost 0 0 0 0 0 0 200,000 0 0 0 0 0
Utilities (Electricity + Water) 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000
Transport 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000
Packaging Materials 710,250 707,250 704,250 700,875 698,250 695,250 0 0 0 0 368,000 732,500
Sales & Marketing Expenses 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000
Interest
Financial Charges
Miscellaneous 400,000 400,000 400,000 400,000 400,000 400,000 400,000 400,000 400,000 400,000 400,000 400,000
Costs) 454,560 0 0 0 0 0 0 0 0 0 0 0
4,443,21 3,979,2 3,969,7 3,959,1 3,950,9 3,978,5 7,953,1 2,450,3 3,370,9 3,363,5 3,741,6 4,571,0
Total Outflows 3 18 83 69 13 58 67 67 43 90 14 30
- - - - -
1,949,03 2,386,0 2,368,4 2,348,7 2,333,3 9,694,6 7,953,1 2,450,3 3,370,9 3,363,5 429,61 2,021,4
Net Profit 7 32 67 06 37 92 67 67 43 90 4 71
15,959,62 17,908,6 20,294,6 22,663,1 25,011,8 27,345,2 37,039,8 29,086,7 26,636,3 23,265,4 19,901,8 19,472,6
CASH BALANCE B/F 3 60 92 59 65 02 94 27 60 17 27 14
- - - -
2,386,03 2,368,46 2,348,70 2,333,33 9,694,69 7,953,16 2,450,36 3,370,94 3,363,59 2,021,47
NET CASH BALANCE 1,949,037 2 7 6 7 2 7 7 3 0 -429,614 1
17,908,66 20,294,6 22,663,1 25,011,8 27,345,2 37,039,8 29,086,7 26,636,3 23,265,4 19,901,8 19,472,2 21,494,0
CASH BALANCE C/F 0 92 59 65 02 94 27 60 17 27 13 85
Annexure 1: ERIC MUGUME'S POULTRY PROJECT - PROJECTED NET INCOME STATEMENT (USHS) - YEAR 3
MONT
H
Item 25 26 27 28 29 30 31 32 33 34 35 36
Total Chickens (1st Flock) 0 0 0 0 0 0 0 0 0 0 0 0
Total Chickens (2nd Flock) 1,944 1,936 1,927 1,919 1,911 1,902 1,894 1,886 1,878 1,869 1,862 1,854
Egg Sales (Trays) 1,458 1,452 1,445 1,439 1,433 1,429 1,421 1,415 1,409 1,402 1,397 1,391
Off-layer Sales (Nos.) _ _ _ _ _ _ _ _ _ _ _ 1,854
CASH INFLOWS
6,534,00 6,502,50 6,475,50 6,448,50 6,430,50 6,394,50 6,367,50 6,340,50 6,309,00 6,286,50 6,259,50
Egg Sales (Ushs) 6,561,000 0 0 0 0 0 0 0 0 0 0 0
7,416,00
6,561,00 6,534,0 6,502,5 6,475,5 6,448,5 6,430,5 6,394,5 6,367,5 6,340,5 6,309,0 6,286,5 13,675,
Total Inflows 0 00 00 00 00 00 00 00 00 00 00 500
CASH OUTFLOWS
Purchase of Layer DOCs 0 0 0 0 0 0 0 0 0 0 0 0
2,032,80 2,023,35 2,014,95 2,006,55 1,997,10 1,988,70 1,980,30 1,971,90 1,962,45 1,955,10 1,946,70
Feeds (Layers) 2,041,200 0 0 0 0 0 0 0 0 0 0 0
Brooding Expenses 0 0 0 0 0 0 0 0 0 0 0 0
Admin. Overheads 32,805 32,670 32,513 32,378 32,243 32,153 31,973 31,838 31,703 31,545 31,433 68,378
Labour (Production Staff) 200,000 200,000 200,000 200,000 200,000 200,000 200,000 200,000 200,000 200,000 200,000 200,000
Vaccination Cost 0 0 0 0 0 0 0 0 0 0 0 0
Spray Cost 0 0 0 0 0 0 0 0 0 0 0 0
Utilities (Electricity + Water) 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000
Transport 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000
Packaging Materials 729,000 726,000 722,500 719,500 716,500 714,500 710,500 707,500 704,500 701,000 698,500 695,500
Sales & Marketing Expenses 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000
Interest
Financial Charges
Miscellaneous 400,000 400,000 400,000 400,000 400,000 400,000 400,000 400,000 400,000 400,000 400,000 400,000
Costs) 466,560 0 0 0 0 0 0 0 0 0 0 0
5,024,48 4,546,3 4,533,2 4,521,7 4,510,2 4,498,6 4,486,0 4,474,5 4,463,0 4,449,9 4,439,9 4,465,4
Total Outflows 2 87 80 45 10 70 90 55 20 12 50 95
1,536,51 1,987,6 1,969,2 1,953,7 1,938,2 1,931,8 1,908,4 1,892,9 1,877,4 1,859,0 1,846,5 9,210,0
Net Profit 8 13 21 56 91 31 11 46 81 88 51 06
21,494,08 23,030,6 25,018,2 26,987,4 28,941,1 30,879,4 32,811,3 34,719,7 36,612,6 38,490,1 40,349,2 42,195,7
CASH BALANCE B/F 5 03 16 37 93 84 15 26 72 53 41 92
1,987,61 1,969,22 1,953,75 1,938,29 1,931,83 1,908,41 1,892,94 1,877,48 1,859,08 1,846,55 9,210,00
NET CASH BALANCE 1,536,518 3 1 6 1 1 1 6 1 8 1 6
23,030,60 25,018,2 26,987,4 28,941,1 30,879,4 32,811,3 34,719,7 36,612,6 38,490,1 40,349,2 42,195,7 51,405,7
CASH BALANCE C/F 3 16 37 93 84 15 26 72 53 41 92 98
Appendix 1: Layer Performance Graph
The graph above shows a hen’s daily production over its lifetime. The actual
performance will vary due to many factors: breed, bird health, light, feed, water,
and temperature all affect production, and results will probably be much lower in
actual project applications. If the birds laid an average of 5 eggs per week, that
would equate to a 70% daily performance, which is the level of output occurring at
week 80 on the above graph. For the sake of this project, daily production values of
4, 5, and 6 eggs per bird per week should be tested.
Appendix 2: Feed Consumption

Body weights and feed requirements of leghorn-type pullets and hens
Age Body Weight (g) Feed Typical Egg

(weeks) Consumption Production (hen-
(g/week) day %)
0 35 45 _
2 135 90 _
4 270 180 _
6 450 260 _
8 620 325 _
10 790 385 _
12 950 430 _
14 1,060 460 _
16 1,160 460 _
18 1,260 460 _
20 1,360 460 _
22 1,425 525 10
24 1,500 595 38
26 1,525 665 64
30 1,725 770 88
40 1,815 770 80
50 1,870 765 74
60 1,900 755 68
70 1,900 740 62

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ERIC MUGUME’S EGG PRODUCTION ENTERPRISE: Business Plan

1.1 Project Brief

Looking at commercial egg production in Uganda, Shaver and Hy-line birds

1.2 Opportunity Rationale

The Ugandan population of over 30 million people is comprised of 75% Christians

Year Eggs (number) Meat (grams)

Fast food outlets

(d) Provide employment opportunities for locals within the area.

1.3 Total Project Cost

Table 2: Summary of Total Project Cost

Account Head Total Cost

Total Project Cost (UShs.) 64,588,399

ERIC MUGUME’S EGG PRODUCTION ENTERPRISE is a sole-proprietor mixed

ERIC MUGUME’S EGG PRODUCTION ENTERPRISE’s main output product will be

ERIC MUGUME’S EGG PRODUCTION ENTERPRISE is essentially focusing its

ERIC MUGUME’S EGG PRODUCTION ENTERPRISE will employ two competitive

ERIC MUGUME’S EGG PRODUCTION ENTERPRISE was founded and is headed by

The objectives for the first three years of operation include:

1. To create a product-based egg-production enterprise whose goal is to exceed

ERIC MUGUME’S EGG PRODUCTION ENTERPRISE’s mission is to provide the

3.0 ENTERPRISE SUMMARY

ERIC MUGUME’S EGG PRODUCTION ENTERPRISE is a scale-optimized poultry

3.1 Enterprise Ownership

ERIC MUGUME’S EGG PRODUCTION ENTERPRISE is a sole proprietorship with

3.2 Start-Up Summary

The short-term credit facility will specifically be designated to financing the

4.0 CURRENT INDUSTRY STRUCTURE

4.1 Poultry Production Systems

4.1.1 Background Information

Chicken production is the main type of poultry production in Uganda. Turkeys,

Table 3: Characteristics of Poultry Production in Uganda

4.1.2 Sector 1: Industrial and Integrated Production

4.1.3 Sectors 2 and 3: Other Commercial Production Systems

This system is characterized by a complete indoor housing system with commercial

 Small-scale units categorised under FAO Sector 3. Mainly household/family

Breeding stocks and hatching eggs

Table 4: List of hatcheries and their operational capacities

4.1.4 Sector 4: Village or Backyard Production

Indigenous chickens are predominant in villages despite the introduction of exotic

Households keep flocks of between 6 and 20 chickens per household excluding

Semi-intensive production system (backyard system)

4.1.5 Poultry Value Chain Analysis

The marketing of poultry in Uganda is not streamlined. Although the objectives of

Marketing of local poultry

Table 5: Prices of free-range chickens in different markets

Figure 1: Simple chicken marketing chain

Traders (Wholesalers – Retailers)

Consumers Farmer Retailers Consumers

Factors affecting the marketing of local chicken in Uganda

Seasonal availability of birds

Lack of information on prices

Lack of streamlined marketing channels

Marketing of commercial poultry and their products

The marketing of commercial broilers or eggs as well as other products is more

Some more organised companies such as Ugachick have introduced a contract

5.0 TRADE, MARKETING AND MARKETS

5.1 Trade, Marketing and Markets for Poultry in Uganda

5.1.1 Domestic Market

5.1.3 Slaughtering Facilities

5.1.4 Poultry Feeds

Table 6: List of commercial feed factories in Uganda

6.0 FARM MANAGEMENT