Pork production process organization. Economic justification

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ProAgro Information Company has prepared the sample business plan

PORK PRODUCTION PROCESS ORGANIZATION. ECONOMIC JUSTIFICATION (4 000 heads)

The main benefit of a business planning is that a well developed business plan reveals prospects of company development, so eventually it answers the most vital question for an entrepreneur and an investor: is it worth investing in this business and will it allow to make profits which will suffice to repay all efforts and costs? Our business plan meets to the maximum all the requirements of Ukrainian banks as for similar documents while providing credits.

This study contains justification of a credit line opening for pork production process organization. The project involves reconstruction of the existing pig-raising farm, purchase of equipment necessary for pig raising according to the "Danish" technology, pig raising and sales in live weight directly to procuring and meat-processing enterprises.

Main parameters of the project:

  • planned feeder pig livestock- 4 000 pigs (2 piggeries), 300 sows;
  • management and fattening technology - "Danish";
  • feed - mainly purchased with prospects of the own feed production organization;
  • planned meat sales volume - 880 tons per year;
  • credit line - $ 2.2 mln., 3 tranches;
  • crediting period - 10 years;
  • lending rate is 14% in US$;
  • the project payback period - 65 months.

Integral indicators of the project efficiency

Indicator

Value

Payback period

65 months

Discounted payback period

72 months

Average profitability rate

40.32 %

Net present value, US$

2 106 023

Profitability index

1.95

Internal rate of return

31.35 %

Modified internal rate of return

16.77 %

Duration

5.62 years

The project analysis conducted according to the "Monte Carlo method", under unfavorable conditions provides sustainable positive forecasts: insignificant increase of the payback period, reduction of the average profitability rate and present value. It gives evidence of quite a high level of the project risk sustainability, its investment attractiveness and a guarantee of the bank credit reimbursement according to the terms agreed.

The project calculation part is in a separate appendix, which provides an opportunity to conduct recalculation depending on the change of input indicators. The appendix enables to export obtained table and graphical results of calculation and analysis to a text editor.

Table of Contents

1. Introduction

1.1. General remarks

1.2. Brief market characteristic

2. Enterprise description

3. Products description

4. Marketing plan

4.1. Market analysis and marketing strategy

4.2. Sales channels

4.3. Price formation

4.4. Market situation. Competitors analysis

4.5. Trends and forecasts for the industry development

4.6. SWOT - analysis

5. Investment plan

6. Operational plan

7. Financial plan

8. Project results

9. Project analysis

10. Project risk sustainability

11. Conclusions

12. Information sources used

13. List of tables

14. List of pictures and diagrams

The project consists of two parts: descriptive and calculation part. The calculation part is a special Russian-language software (it is a component of the project set together with a manual) that enables a user to change on his/her own account the project initial parameters depending on the specific conditions, to conduct all the necessary economic calculations and to analyze the project economic efficiency.

Furthermore, ProAgro Company is ready to prepare upon separate request a business plan for a pork production organization on your enterprise.

To get additional information about this work, please, contact to ProAgro Information Company: