Cut Flower Farm - Rose

Pre-Feasibility Study
(Cut Flower Farm - Rose)
Small and Medium Enterprises Development Authority Ministry of Industries & Production
Government of Pakistan
www.smeda.org.pk
HEAD OFFICE
4th Floor, Building No. 3, Aiwan-e-Iqbal Complex, Egerton Road, Lahore Tel: (92 42) 111 111 456, Fax: (92 42) 36304926-7
helpdesk@smeda.org.pk
REGIONAL OFFICE Punjab 3rd Floor, Building No. 3, Aiwan-e-Iqbal Complex, Egerton Road Lahore, Tel: (042) 111-111-456 Fax: (042) 36304926-7 helpdesk.punjab@smeda.org.pk REGIONAL OFFICE Sindh 5th Floor, Bahria Complex II, M.T. Khan Road, Karachi. Tel: (021) 111-111-456 Fax: (021) 35610572 helpdesk-khi@smeda.org.pk REGIONAL OFFICE Khyber Pakhtunkhwa Ground Floor State Life Building The Mall, Peshawar. Tel: (091) 111-111-456 Fax: (091) 5286908 helpdesk-pew@smeda.org.pk REGIONAL OFFICE Balochistan Bungalow No. 15-A Chaman Housing Scheme Airport Road, Quetta. Tel: (081) 2831623, 2831702 Fax: (081) 2831922 helpdesk-qta@smeda.org.pk
Note: All SMEDA Services / information related to PM's Youth Business Loan are Free of Cost December, 2013
Cut Flower Farm (Rose)
TABLE OF CONTENTS
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 12.1 12.2 12.3 12.4 12.5 12.6 12.7 12.8 12.9 13. 14. 14.1 14.2 14.3 14.4 14.5 15. DISCLAIMER ......................................................................................................................... 2 PURPOSE OF THE DOCUMENT .......................................................................................... 3 INTRODUCTION TO SMEDA ................................................................................................ 3 INTRODUCTION TO SCHEME.............................................................................................. 4 EXECUTIVE SUMMARY ........................................................................................................ 4 BRIEF DESCRIPTION OF PROJECT & PRODUCT............................................................. 5 CRITICAL FACTORS ............................................................................................................ 5 INSTALLED & OPERATIONAL CAPACITIES ...................................................................... 5 GEOGRAPHICAL POTENTIAL FOR INVESTMENT ............................................................ 5 POTENTIAL TARGET MARKETS / CITIES .......................................................................... 6 PRODUCTION PROCESS FLOW ......................................................................................... 6 PROJECT COST SUMMARY ................................................................................................ 7 PROJECT ECONOMICS .......................................................................................................... 7 PROJECT FINANCING ............................................................................................................ 7 PROJECT COST .................................................................................................................... 8 LAND AND PLANTS REQUIREMENT ......................................................................................... 8 FARM TOOLS, EQUIPMENT AND FURNITURE ........................................................................... 9 RAW MATERIAL REQUIREMENTS............................................................................................ 9 HUMAN RESOURCE REQUIREMENT ........................................................................................ 9 REVENUE GENERATION ...................................................................................................... 10 OTHER COSTS ................................................................................................................... 10 CONTACTS SUPPLIERS, EXPERTS / CONSULTANTS ................................................ 10 ANNEXURE.......................................................................................................................... 11 INCOME STATEMENT ........................................................................................................... 11 STATEMENT OF CASH FLOW ................................................................................................ 12 BALANCE SHEET................................................................................................................. 13 USEFUL PROJECT MANAGEMENT TIPS ................................................................................. 14 USEFUL LINKS .................................................................................................................... 14 KEY ASSUMPTIONS ........................................................................................................... 16
1. DISCLAIMER
This information memorandum is to introduce the subject matter and provide a general idea and information on the said subject. Although, the material included in this document is based on data / information gathered from various reliable sources; however, it is based upon certain assumptions which may differ from case to case. The information has been provided on as is where is basis without any warranties or assertions as to the correctness or soundness thereof. Although, due care and diligence has been taken to compile this document, the contained information may vary due to any change in any of the concerned factors, and the actual results may differ substantially from the presented information. SMEDA, its employees or agents do not assume any liability for any financial or other loss resulting from this memorandum in consequence of undertaking this activity. The contained information does not preclude any further professional advice. The prospective user of this memorandum is encouraged to carry out additional diligence and gather any information which is necessary for making an informed decision, including taking professional advice from a qualified consultant / technical expert before taking any decision to act upon the information. For more information on services offered by SMEDA, please contact our website: www.smeda.org.pk
SMEDA Services / Information related to PMs Youth Business Loan are FREE OF COST -
2. PURPOSE OF THE DOCUMENT

The objective of the pre-feasibility study is primarily to facilitate potential entrepreneurs in project identification for investment. The project pre-feasibility may form the basis of an important investment decision and in order to serve this objective, the document / study covers various aspects of project concept development, start-up, production, marketing, finance and business management. The purpose of this document is to facilitate potential investors in Cut Flower Farm (Rose) by providing them a general understanding of the business with the intention of supporting potential investors in crucial investment decisions. The need to come up with pre-feasibility reports for undocumented or minimally documented sectors attains greater imminence as the research that precedes such reports reveal certain thumb rules; best practices developed by existing enterprises by trial and error, and certain industrial norms that become a guiding source regarding various aspects of business set-up and its successful management. Apart from carefully studying the whole document one must consider critical aspects provided later on, which form basis of any Investment Decision.
3. INTRODUCTION TO SMEDA
The Small and Medium Enterprises Development Authority (SMEDA) was established in October 1998 with an objective to provide fresh impetus to the economy through development of Small and Medium Enterprises (SMEs). With a mission "to assist in employment generation and value addition to the national income, through development of the SME sector, by helping increase the number, scale and competitiveness of SMEs" , SMEDA has carried out sectoral research to identify policy, access to finance, business development services, strategic initiatives and institutional collaboration and networking initiatives. Preparation and dissemination of prefeasibility studies in key areas of investment has been a hallmark of SME facilitation by SMEDA. Concurrent to the prefeasibility studies, a broad spectrum of business development services is also offered to the SMEs by SMEDA. These services include identification of experts, consultants and delivery of need based capacity building programs of different types in addition to business guidance through help desk services.
4. INTRODUCTION TO SCHEME
Prime Ministers Youth Business Loans Programme, for young entrepreneurs, with an allocated budget of Rs. 5.0 Billion for the year 2013-14, is designed to provide subsidised financing at 8% mark-up per annum for one hundred thousand (100,000) beneficiaries, through designated financial institutions, initially by the National Bank of Pakistan (NBP) and the First Women Bank Ltd. (FWBL). Loans of Rs. 0.1 million to Rs. 2.0 million with tenure up to 8 years including 1 year grace period, and a debt : equity of 90 : 10 will be disbursed to SME beneficiaries across Pakistan, covering; Punjab, Sindh, Khyber Pakhtunkhwa, Balochistan, Gilgit Baltistan, Azad Jammu & Kashmir and Federally Administered Tribal Areas (FATA).
5. EXECUTIVE SUMMARY
Growing cut flowers, especially roses as they are most traded flowers of all flower varieties around the world, is a profitable business if done properly. Local demand for cut flowers is growing tremendously due to increased usage as decorative items in weddings, birthday parties, seminars, and other social gatherings. In Pakistan, this sector has not gained its full potential yet. The major reason for slow development of this sector has been the lack of requisite technical knowledge on part of the farmers, traders and retailers. The credit goes to small farmers / entrepreneurs who have kept on going without much technical and / or financial support over the years. Low cost of labor combined with reasonable land lease rates and a suitable climate for most part of the year make investment in this business a lucrative proposition. The cost for setting up the proposed project at 05 acres land is Rs. 2.20 million and will provide employment to 6 individuals in addition to seasonal labor for picking and pruning etc. The project, under Prime Ministers Youth Business Loan is proposed to be financed through 90% debt and 10% equity. The project NPV is projected Rs. 9.55 million, with an IRR of 54% and a payback period of 2.56 years. The legal status of the business is proposed as Sole Proprietorship.
6. BRIEF DESCRIPTION OF PROJECT & PRODUCT This pre-feasibility study is designed to provide information for establishing a 05 acre cut flower farm of Rose. The farm land is assumed to be acquired on long term lease i.e. 10 years at any of the suitable locations. The farm can be established at any of the locations identified in the geographical potential section The farm will have 50 thousand rose plants having productive life of 10 years. The farm will have a total production capacity of 5.00 million flowers per year, however, for the first year farm productivity is assumed at 40%. The cut flowers will be sold in the wholesale markets of the respective districts / metropolitan cities. The cost of this project is Rs. 2.20 million, with Rs. 0.52 million for working capital and remaining Rs. 1.68 million as capital cost.
7. CRITICAL FACTORS
The proposed project has following factors critical to success: Entrepreneurs knowledge, background and expertise in floriculture. Ability to identify and procure quality saplings from certified nurseries, preferably developing an in-house backup nursery. Availability / selection of suitable land and irrigation systems. Availability of trained farm labor for crop management and harvest Forward linkages with the bulk buyers, and appropriate storage & transportation services.
8. INSTALLED & OPERATIONAL CAPACITIES

The farm will consist of 5 acres of agriculture land for growing Roses. On average there are 10,000 plants per acre producing 1 million flowers per year, with adequate pruning, picking and delivery arrangements. The plants have productive life of 10 years. Accordingly, the total production capacity of the proposed farm is 5 million flowers per year. However, 20% of the total production goes to rose petals, hence, quantity available for sale as rose petals would be 2,500 kg, derived from 1 million flowers.
9. GEOGRAPHICAL POTENTIAL FOR INVESTMENT

Although Kasur and Sheikhupura districts of Punjab, Matiari & Jhirk in Sindh and Swat and Quetta valley have developed some expertise in this field. However, as
SMEDA Services / Information related to PMs Youth Business Loan are FREE OF COST 5
Pattoki still serves as the hub for floricultural trade in Pakistan, it is therefore considered the most appropriate location. All major cities of the country with comparable land and atmospheric conditions can be selected for establishment of this kind of business. Patto mandi is the major forum for buying and selling of fresh cut flowers, especially roses. Flowers are distributed to all parts of the country including Karachi, Peshawar, Lahore, and Islamabad from here. There are few large players in this industry with an organized formal setup. Therefore, there is good potential to tap into this opportunity to start a cut flower business with a formal set up.
10. POTENTIAL TARGET MARKETS / CITIES

Potential markets for cut flowers (roses) are as under; Flower Market such as Patto Mandi and Begumkot Mandi at Pattoki and Sheikhpura districts respectively Retail flower shops at major urban centers Direct supply to corporate and institutional customers Wholesales; bulk sales for social, cultural and religious events
11. PRODUCTION PROCESS FLOW

Purchase of Saplings and Transportation
Land Preparation
Sowing
Treatment with life enhancing solution
Picking, Washing and Cleaning
Plant Management
Visual Inspection and Packing
Transportation
Auction
12. PROJECT COST SUMMARY

A detailed financial model has been developed to analyze the commercial viability of the Cut Flower Farm under the Prime Ministers Youth Business Loan scheme. Various cost and revenue related assumptions along with results of the analysis are outlined in this section. The projected Income Statement, Cash Flow Statement and Balance Sheet are attached as appendix. 12.1 Project Economics All the figures in this financial model have been calculated for a target of 5,000,000 flowers per year for 5 acre farm, whereby in first year the plants will give 40% of its capacity which is 2,000,000 flowers. In second year plants will give flowers at full capacity. The following table shows internal rates of return and payback period. Table 1: Project Economics Description Internal Rate of Return (IRR) Payback Period (yrs) Net Present Value (NPV) Details 54% 2.56 Rs. 9,550,712
Returns on the farm and its profitability are highly dependent on the efficiency of raw material intake like good quality flower plants, fertilizers, pesticides, proper irrigation, pruning and weeding. In case, these factors are not properly managed, the required output cannot be attained. Farm owner will not be able to cover the potential market and recover payments; hence cost of operating the business will increase. 12.2 Project Financing Following table provides details of the equity required and variables related to bank loan; Table 2: Project Financing Description Total Equity (10%) Bank Loan (90%) Markup to the Borrower (%age/annum) Tenure of the Loan (Years) Grace Period (Year) Details Rs. 219,605 Rs. 1,976,448 8% 8 1
12.3 Project Cost Following requirements have been identified for operations of the proposed business. Table 3: Capital Investment for the Project Capital Investment Land Tillage and Rose Sapling Furniture & Equipment for Farm Land development and irrigation system Total Capital Cost Initial Working Capital Total Project Cost Amount (Rs.) 1,063,000 40,000 573,679 1,676,679 519,375 2,196,054
12.4 Land and Plants Requirement The land has been calculated on the basis of market prices, economically viable and sustainable area for this business is 4 acre, however, for this pre-feasibility study we take 5 acre land, inclusive of small nursery to be leased. Table 4: Land Requirement Land Requirement (in acre) Land Required 5 acre Per Acre Rent (Rs.) 55,000 Amount of rent per year (Rs.) 275,000
Farm practices for per acre plantation varies according to land condition, normally 6,000 to 12,000 plants per acre are cultivated; however, this prefeasibility study assumes 10,000 plants in one acre.
Table 5: Plants Requirement Cultivated Qty/acre Rose Plants Land Tillage Total 10,000 Total Plants required for 5 acre farm 50,000 Rate Per Plant (Rs.) 20 Total Amount (Rs.) 1,000,000 63,000 1,063,000
12.5 Farm Tools, Equipment and Furniture Following table provides list of tools and equipment required for an average 5 acre farm. Table 6: List of Farm Tools, Equipment and Furniture Description Farm Tools & Equipment Furniture Total Cost Rs/acre 4,000 Total Amount (Rs.) 20,000 20,000 40,000
12.6 Raw Material Requirements On time irrigation, use of prescribed pesticides & fertilizers and proper weeding are essential for required output and continuous supply in the market. Following table shows raw material requirement for 1,000,000 flowers from one acre land: Table 7: Annual Cost of Farm Inputs (Per Acre) Amount (Rs.) Fertilizer Pesticides Irrigation Weeding Total 50,000 45,000 70,000 40,000 205,000
* Considering first year to be most crucial for getting proper and continuous output from the farm for around 10 years, cost of above mentioned farm inputs is taken on higher side and therefore estimated at Rs. 512,500. 12.7 Human Resource Requirement The table below provides details of human resource required to run such a farm. Table 8: Human Resource Requirement
Description Owner Manager Worker Total Staff No. of Employees 1 5 6 Total Salary per month (Rs.) 20,000 50,000 70,000
Normally one worker is required for one acre while weeding will be done from outsourced laborers whose cost is already mentioned in Raw Material Calculation table.
SMEDA Services / Information related to PMs Youth Business Loan are FREE OF COST 9
12.8 Revenue Generation Table 9: Revenue Generation Product Flowers with Stems Flowers as Petal Total Unit Flowers Flowers Sales Price (Rs./Flower) 1.52 0.05 First Year Production 1,600,000 400,000 First Year Sales Revenue (Rs) 2,432,000 20,000 2,452,000
12.9 Other Costs An essential cost to be borne by the farmer is the packing (which is assumed as Rs. 0.2 per flower) and travelling cost (which is assumed as 2% on sales) from farm to Mandi.
13. CONTACTS SUPPLIERS, EXPERTS / CONSULTANTS

Dr. M. Aslam Parvez Director, Institute of Horticultural Sciences, Faculty of Agriculture, University of Agriculture, Faisalabad Ph: +92-41-9201281, +92-41-9200161 Ext. 2952 Dr. Muhammad Anjum Ali Director General (Extension) Agriculture Department, Govt. of Punjab 21-Davis Road, Lahore Ph: 92-42-99200732 Fax No: 92-42-99200743 Dr. Ghulam Jellani, PSO/ P.L (Vegetable) Programme on Vegetable Crop Horticulture Research Institute National Agricultural Research Centre Park Road, Islamabad Ph: +92-51 9255061, +92-51 9255012 Fax: +92-51 9255034 CEO Pakistan Horticulture Development and Export Company 30 N, Model Town Extension, Lahore (54700), Pakistan. Tel: +92-42-99232210-17 Fax: +92-42-99232220
10
14. ANNEXURE
14.1 Income Statement
Income Statement
Year 1 2,452,000 512,500 320,000 600,000 36,000 1,468,500 983,500 240,000 275,000 49,040 24,000 110,300 57,368 755,708 227,792 227,792 164,044 164,044 63,748 3,187 60,560 Year 2 4,045,800 1,148,000 672,000 660,000 39,600 2,519,600 1,526,200 264,000 302,500 80,916 26,400 110,300 57,368 841,484 684,716 684,716 150,184 150,184 534,532 57,680 476,853 Year 3 5,933,840 1,285,760 1,003,520 726,000 43,560 3,058,840 2,875,000 290,400 332,750 118,677 29,040 110,300 57,368 938,535 1,936,465 1,936,465 131,967 131,967 1,804,498 248,174 1,556,324 Year 4 6,527,224 1,440,051 1,123,942 798,600 47,916 3,410,510 3,116,714 319,440 366,025 130,544 31,944 110,300 57,368 1,015,621 2,101,093 2,101,093 112,239 112,239 1,988,854 275,828 1,713,027 Year 5 7,179,946 1,612,857 1,258,815 878,460 52,708 3,802,840 3,377,106 351,384 402,628 143,599 35,138 110,300 57,368 1,100,417 2,276,689 2,276,689 90,872 90,872 2,185,817 305,372 1,880,445 Year 6 7,897,941 1,806,400 1,409,873 966,306 57,978 4,240,558 3,657,383 386,522 442,890 157,959 38,652 110,300 57,368 1,193,692 2,463,692 2,463,692 67,733 67,733 2,395,959 336,893 2,059,065 Year 7 8,687,735 2,023,168 1,579,058 1,062,937 63,776 4,728,939 3,958,796 425,175 487,179 173,755 42,517 110,300 57,368 1,296,294 2,662,502 2,662,502 42,673 42,673 2,619,829 370,474 2,249,355 Year 8 9,556,509 2,265,948 1,768,545 1,169,230 70,154 5,273,878 4,282,631 467,692 535,897 191,130 46,769 110,300 57,368 1,409,157 2,873,474 2,873,474 15,533 15,533 2,857,942 406,191 2,451,751 Year 9 10,512,160 2,537,862 1,980,771 1,286,153 77,169 5,881,955 4,630,204 514,461 589,487 210,243 51,446 110,300 57,368 1,533,305 3,096,899 3,096,899 3,096,899 442,035 2,654,864 Year 10 11,563,375 2,842,406 2,218,463 1,414,769 84,886 6,560,523 5,002,852 565,907 648,436 231,268 56,591 110,300 57,368 1,669,869 3,332,983 3,332,983 3,332,983 477,447 2,855,536
Revenue Cost of sales Cost of goods sold 1 Packing Material Operation costs 1 (direct labor) Operating costs 3 (direct electricity) Total cost of sales Gross Profit General administration & selling expenses Administration expense Land lease rental expense Travelling expense Communications expense (phone, fax, mail, internet, etc.) Depreciation expense Amortization of pre-operating costs Subtotal Operating Income Earnings Before Interest & Taxes Interest expense on long term debt (Debt facility : Bank 1) Subtotal Earnings Before Tax Tax NET PROFIT/(LOSS) AFTER TAX
11
14.2
Statement of Cash Flow
Cash Flow Statement

Year 0 Operating activities Net profit Add: depreciation expense amortization of pre-operating costs Deferred income tax Accounts receivable Raw material inventory Accounts payable Cash provided by operations Financing activities Debt facility : Bank 1 - principal repayment Add: land lease expense Land lease payment Additions to Debt facility : Bank 1 Issuance of shares Cash provided by / (used for) financing activities Investing activities Capital expenditure Acquisitions Cash (used for) / provided by investing activities NET CASH Year 1 60,560 110,300 57,368 3,187 (33,589) (97,458) 41,068 141,437 Year 2 476,853 110,300 57,368 57,680 (10,916) (64,002) 43,212 670,493 Year 3 1,556,324 110,300 57,368 248,174 (23,848) (53,554) 21,486 1,916,250 Year 4 1,713,027 110,300 57,368 275,828 (16,996) (65,978) 14,001 2,087,549 Year 5 1,880,445 110,300 57,368 305,372 (8,535) (81,285) 15,985 2,279,649 Year 6 2,059,065 110,300 57,368 336,893 (9,388) (100,144) 18,277 2,472,372 Year 7 2,249,355 110,300 57,368 370,474 (10,327) (123,377) 20,931 2,674,724 Year 8 2,451,751 110,300 57,368 406,191 (11,360) (152,000) 24,011 2,886,260 Year 9 2,654,864 110,300 57,368 442,035 (12,496) (187,264) 27,592 3,092,398 Year 10 2,855,536 110,300 57,368 477,447 (13,746) 994,439 (18,584) 4,462,760
(69,375) (69,375)
(275,000) 1,976,448 219,605 1,921,054
275,000 (302,500) (27,500)
(219,480) 302,500 (332,750) (249,730)
(237,697) 332,750 (366,025) (270,972)
(257,426) 366,025 (402,628) (294,028)
(278,792) 402,628 (442,890) (319,054)
(301,931) 442,890 (487,179) (346,220)
(326,991) 487,179 (535,897) (375,709)
(354,132) 535,897 (589,487) (407,721)
589,487 (648,436) (58,949)
648,436 648,436
(1,676,679) (1,676,679) 175,000
113,937
420,763
1,645,278
1,793,521
1,960,595
2,126,151
2,299,015
2,478,539
3,033,449
5,111,196
12
14.3
Balance Sheet
Balance Sheet
Year 0 Assets Current assets Cash & Bank Accounts receivable Raw material inventory Pre-paid annual land lease Total Current Assets Fixed assets Saplings & Land Tillage Machinary & Equipment Furniture & fixtures Total Fixed Assets Intangible assets Pre-operation costs Total Intangible Assets TOTAL ASSETS Liabilities & Shareholders' Equity Current liabilities Accounts payable Total Current Liabilities Other liabilities Deferred tax Long term debt (Debt facility : Bank 1) Total Long Term Liabilities Shareholders' equity Paid-up capital Retained earnings Total Equity TOTAL CAPITAL AND LIABILITIES Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
175,000 69,375 275,000 519,375
288,937 33,589 166,833 302,500 791,859
709,700 44,505 230,836 332,750 1,317,791
2,354,979 68,354 284,390 366,025 3,073,747
4,148,499 85,350 350,368 402,628 4,986,845
6,109,094 93,885 431,653 442,890 7,077,522
8,235,245 103,273 531,797 487,179 9,357,495
10,534,260 113,601 655,174 535,897 11,838,932
13,012,799 124,961 807,174 589,487 14,534,421
16,046,249 137,457 994,439 648,436 17,826,580
21,157,444 151,202 21,308,647
1,063,000 20,000 20,000 1,103,000
956,700 18,000 18,000 992,700
850,400 16,000 16,000 882,400
744,100 14,000 14,000 772,100
637,800 12,000 12,000 661,800
531,500 10,000 10,000 551,500
425,200 8,000 8,000 441,200
318,900 6,000 6,000 330,900
212,600 4,000 4,000 220,600
106,300 2,000 2,000 110,300
573,679 573,679 2,196,054
516,311 516,311 2,300,870
458,943 458,943 2,659,135
401,575 401,575 4,247,422
344,207 344,207 5,992,852
286,839 286,839 7,915,862
229,472 229,472 10,028,166
172,104 172,104 12,341,935
114,736 114,736 14,869,757
57,368 57,368 17,994,247
(0) (0) 21,308,647
41,068 41,068
84,281 84,281
105,767 105,767
119,768 119,768
135,753 135,753
154,030 154,030
174,962 174,962
198,973 198,973
226,565 226,565
207,981 207,981
1,976,448 1,976,448
3,187 1,976,448 1,979,636
60,867 1,756,968 1,817,835
309,041 1,519,272 1,828,313
584,869 1,261,846 1,846,715
890,241 983,054 1,873,296
1,227,135 681,123 1,908,258
1,597,609 354,132 1,951,741
2,003,800 2,003,800
2,445,834 2,445,834
2,923,282 2,923,282
219,605 219,605 2,196,054
219,605 60,560 280,166 2,300,870
219,605 537,413 757,018 2,659,135
219,605 2,093,737 2,313,342 4,247,422
219,605 3,806,763 4,026,368 5,992,852
219,605 5,687,208 5,906,813 7,915,862
219,605 7,746,273 7,965,878 10,028,166
219,605 9,995,628 10,215,233 12,341,935
219,605 12,447,379 12,666,984 14,869,757
219,605 15,102,243 15,321,848 17,994,247
219,605 17,957,779 18,177,384 21,308,647
13
14.4
Useful Project Management Tips
Technology Apart from emphasis on the farm technology, storage & delivery equipment and best practices to be ensured.
Marketing Product Development & Packaging: Expert's help may be engaged for product development and packaging Ads & P.O.S. Promotion: Business promotion and dissemination through banners and launch events is highly recommended. Sales & Distribution Network: Expert's advise and distribution agreements should be taken. Price - Bulk Discounts, Cost plus Introductory Discounts: Price should never be allowed to compromise quality. Price during introductory phase may be lower and used as promotional tool. Product cost estimates should be carefully documented before price setting. Government controlled prices shall be displayed, where ever applicable.
Human Resources Training & Skill Development: Encouraging training and skill of self & employees through exposure to similar facilities elsewhere.
14.5
Useful Links Prime Ministers Office, www.pmo.gov.pk Small and Medium Enterprise Development Authority, www.smeda.org.pk National Bank of Pakistan (NBP), www.nbp.com.pk First Women Bank Limited (FWBL), www.fwbl.com.pk Government of Pakistan, www.pakistan.gov.pk Ministry of Industries & Production, www.moip.gov.pk Ministry of Education, Training & Standards in Higher Education, http://moptt.gov.pk Government of Punjab, www.punjab.gov.pk Government of Sindh, www.sindh.gov.pk Government of Khyber Pakhtunkhwa, www.khyberpakhtunkhwa.gov.pk
14
Government of Balochistan, www.balochistan.gov.pk Government of Gilgit Baltistan, www.gilgitbaltistan.gov.pk Government of Azad Jammu Kashmir, www.ajk.gov.pk Trade Development Authority of Pakistan (TDAP), www.tdap.gov.pk Securities & Exchange Commission of Pakistan (SECP), www.secp.gov.pk Federation of Pakistan Chambers of Commerce and Industry (FPCCI) www.fpcci.com.pk State Bank of Pakistan (SBP), www.sbp.org.pk University of Agriculture, Faisalabad, www.uaf.edu.pk Barani Agriculture Research Institute, Chakwal, www.barichakwal.org Pakistan Horticulture Development & Export Company, www.phdeb.org Parks and Horticulture Authority, www.pha.gop.pk
15
15. KEY ASSUMPTIONS

Table 10: Cash Flow Assumptions Accounts Payable (Days) Accounts Receivable (Days) Raw Material Inventory (Days) Table 11: Expense Assumptions Communication Expenses Travelling Expense 10% of administration expenses 2% of sales 15 5 30
Table 12: Capacity Utilization Assumptions Starting Capacity Utilization Annual Growth Rate Maximum Capacity Utilization for the Project 40% 20% 80%
16

Cut Flower Farm - Rose

Uploaded by

Document Information

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Cut Flower Farm - Rose

Uploaded by

Copyright:

Available Formats

Pre-Feasibility Study

(Cut Flower Farm - Rose)

Cut Flower Farm (Rose)

Cut Flower Farm (Rose)

Cut Flower Farm (Rose)

2. PURPOSE OF THE DOCUMENT

Cut Flower Farm (Rose)

Cut Flower Farm (Rose)

8. INSTALLED & OPERATIONAL CAPACITIES

9. GEOGRAPHICAL POTENTIAL FOR INVESTMENT

Cut Flower Farm (Rose)

10. POTENTIAL TARGET MARKETS / CITIES

11. PRODUCTION PROCESS FLOW

Treatment with life enhancing solution

Picking, Washing and Cleaning

Visual Inspection and Packing

Cut Flower Farm (Rose)

12. PROJECT COST SUMMARY

Cut Flower Farm (Rose)

Cut Flower Farm (Rose)

Cut Flower Farm (Rose)

13. CONTACTS SUPPLIERS, EXPERTS / CONSULTANTS

Cut Flower Farm (Rose)

Cut Flower Farm (Rose)

Statement of Cash Flow

Cash Flow Statement

(275,000) 1,976,448 219,605 1,921,054

275,000 (302,500) (27,500)

(219,480) 302,500 (332,750) (249,730)

(237,697) 332,750 (366,025) (270,972)

(257,426) 366,025 (402,628) (294,028)

(278,792) 402,628 (442,890) (319,054)

(301,931) 442,890 (487,179) (346,220)

(326,991) 487,179 (535,897) (375,709)

(354,132) 535,897 (589,487) (407,721)

589,487 (648,436) (58,949)

(1,676,679) (1,676,679) 175,000

Cut Flower Farm (Rose)

175,000 69,375 275,000 519,375

288,937 33,589 166,833 302,500 791,859

709,700 44,505 230,836 332,750 1,317,791

2,354,979 68,354 284,390 366,025 3,073,747

4,148,499 85,350 350,368 402,628 4,986,845

6,109,094 93,885 431,653 442,890 7,077,522

8,235,245 103,273 531,797 487,179 9,357,495

10,534,260 113,601 655,174 535,897 11,838,932

13,012,799 124,961 807,174 589,487 14,534,421

16,046,249 137,457 994,439 648,436 17,826,580

21,157,444 151,202 21,308,647

1,063,000 20,000 20,000 1,103,000

956,700 18,000 18,000 992,700

850,400 16,000 16,000 882,400

744,100 14,000 14,000 772,100

637,800 12,000 12,000 661,800

531,500 10,000 10,000 551,500

425,200 8,000 8,000 441,200

318,900 6,000 6,000 330,900

212,600 4,000 4,000 220,600

106,300 2,000 2,000 110,300

573,679 573,679 2,196,054

516,311 516,311 2,300,870

458,943 458,943 2,659,135

401,575 401,575 4,247,422

344,207 344,207 5,992,852