SANI SALIHU
AMADU BELLO UNIVERSITY ZAIRA
COLLEGE OF EDUCATION AKWANGA
COURSE TITLE: ENTREPRENEURSHIP
PHONE: 07038821088
ADDRESS: NASARAWA EGGON, NASARAWA
STATE
FISH FARMING
BUSINESS PLAN
GET ESTIMATED COST AND PROFIT
Table of Contents
1. Executive Summary
1.1. Fish Farming Startup Expenses
2. General Company Description
3. Products and Services
3.1. Industry Analysis
3.2. Customer Profile
4. Fish Farming Marketing Plan
4.1. Marketing Objectives
4.2. Pricing
4.3. Economics
5. Product
5.1. Features and Benefits
5.2. Customers
5.3. Competition
5.4. Niche
5.5. Strategy
5.6. Promotion
5.7. Sales Forecast
6. Operational Plan
6.1. Production
6.2. Location
6.3. Legal Environment
6.4. Personnel
6.5. Inventory
6.6. Suppliers
6.7. Credit Policies
7. Management and Organization
8. Personal Financial Statement
9. Startup Expenses and Capitalization
10. Financial Plan
10.1. 24-months (2-years) Profit and Loss Projection
10.2. Business Plan Projected Cash Flow
11. Share this:
11.1. Like this:
12. Related
Executive Summary
Fish farming is a lucrative business; it is also simple and can be started with small
capital. Anyone with a small space and can find a market within a locality can engage
in fish farming. In fact, with as little as $750 you can start fish farming. In this
business plan, we shall discuss how you can successfully set up a fish farming
business.
Our business plan on fish farming shall begin with the production of catfish but later,
tilapia shall be added. We shall sell fresh initially but later, the introduction of drying
and packaging also follows. Our customers shall be an open market, restaurant, and
grocery. Over time with reasonable expansion, we shall commence exporting the
product when the local market is satisfied. With the support of my husband, the farm
belongs to me, My Business Name, and I would see to the day-to-day operation of
the farm. We are looking forward to expanding the fish farming business for
sustainability. It will be a legacy for our children up continually, by God’s grace.
Since fish will always be consumed by man, our fish farming business will excel.
Fish Farming Startup Expenses
The fish farming project would take approximately N1,500,000.00 (One Million Five
Hundred Thousand Naira only) to be deployed as follows: please see VI. Startup
Expenses and Capitalization.
If you want to set up a fish farming business with less amount, say, N500,000 or
N1,000,000 then you will not include some equipment. See startup Expenses and
capitalization
The pelletizing machine and dryer would enable me to prepare my own feed which
would be cheaper in the long run, thereby increasing my profit. This is because
imported fish feed is expensive and would reduce the profit margin if depended upon
throughout the six months grow-out period.
General Company Description
Our business will basically be hinged on preparing the site, acquiring two mobile
ponds, fertilize the ponds within say 2 weeks, buy 500 fingerlings for each of the
ponds, feed them two times a day till maturity at 6 months, and then sale off as point-
and-kill or as dried fish or both. Having sold off, we stock again and repeat the
process of brood and sale. We shall also go into hatching over time.
Mission Statement: to be self-employed, create employment opportunities for
others, provide protein to the populace and help save some foreign exchange for
Nigeria.
Company Goals and Objectives: Our goal is to have a healthy, successful company
that is a leader in customer service and that has a loyal customer following. While
our Objective will be to have our dried fish in every pot of soup in Nigeria.
Business Philosophy: To earn a good living from what I offer to my customers,
while they continue desiring that we serve them always.
Target Customer: Since there are no religious, cultural, or demographic barriers to
the consumption of catfish, our customers shall be the open market, restaurants, and
grocery shops. Over time with reasonable expansion, we shall commence exporting
the product when the local market is satisfied or just to earn foreign currency.
Competition: The catfish farming industry is still in its infancy in Nigeria, with the
commodity very expensive because it is insufficient to go around. Most of the
practitioners do it on a small scale in their backyards and near their houses. With
enough financing, the country would begin to witness large-scale fish farming
running into hundreds of million naira. The cost of imported fish feed is very high
now because of the high cost of the dollar. This, in turn, makes the fish unaffordable
for the common man. With growth over time and encouraging national agricultural
finance policy, we desire venturing into commercial local fish feed production as
soon as possible so that we can have a first-time advantage.
Strength and Competencies: Fish farming, though available, requires skilled
manpower. To set up a fish farming business, you need to learn how to cater to the
fish. The most important strength and competence of the company are based on the
fact that the prime mover is a graduate and highly trainable. She can easily adapt to
changing situations. Our consultants also have many years experience in the industry
and they are also vast in management and are ever ready to keep supporting us. We
shall ensure that our top management personnel has high-level manpower, unlike
other fish farming businesses, where you mostly find the uneducated managing the
affairs of the business.
Legal ownership: for now, our Legal form of ownership is Sole proprietorship and is
subject to available cash but, we are open to other business structures like
Partnership, Limited liability, and even Public Liability as our final destination.
business plan on fish farming
Cat Fish for Fish Farming
Products and Services
This fish farming will basically be hinged on preparing the site, acquiring two mobile
ponds, fertilizing the ponds within 2 weeks, buying 500 fingerlings for each of the
ponds, feeding them two times a day till maturity at 6 months, and then selling off as
point-and-kill or as dried fish or both. Having sold off we stock the ponds again and
repeat the process of brooding and selling. At this point, we intend to keep some fish
until we can use them for hatching. This would mean constructing another mobile
pond as hatchery/nursery ponds, like say 3 numbers of 8 x 8 feet. At the onset of
operations, the Fishery will have approximately 2 people to assist with the day-to-day
operations. Another important product and service is the preparation and sales of fish
feed. This would, however, require a separate capital outlay not covered in this
business plan.
Currently, the Nigerian economy is slowly recovering from recession. This
slowdown in the economy has also greatly impacted real estate sales, which has
halted to historical lows. Many economists expect that this recession will continue
through 2016, at which point the economy will begin a prolonged recovery period.
However, this should have a minimal impact on the Fishery’s ability to generate
revenues, as much of its produced fish will be geared towards popular fish that are
constantly in demand regardless of the general economic climate.
Industry Analysis
Each year, the industry generates a lot of money from fish farming through retail fish
sales. These sales also include the receipts generated by restaurants that specialize in
the sale of seafood. Among importers and distributors, a lot of money running into
billion is recognized annually among market agents. The industry also employs so
many people. The growth of the industry is expected to continue as more Nigerians
are seeking to add fish and other seafood products to their diets for both the taste and
health benefits associated with seafood. One of the most common trends in the
fishery industry is that newer technologies are actually increasing the net profit
margins of the business while concurrently lessening the environmental impact of
fisheries on the environment.
Customer Profile
It is extremely difficult to determine the customer profile of people that will acquire
the fish produced by us because fish is consumed by all. The Company intends to do
business with farmer’s markets, fishery coops, and fish/seafood wholesalers that will
acquire the Company’s inventories of fish.
Fish Farming Marketing Plan
The Fishery’s marketing operations will be minimal as once the Company solidifies
ongoing relationship with fishery coops and wholesalers, very little marketing will be
required to maintain these relationships. At the onset of operation, we intend to
aggressively develop relationships with local and regional fishery coops that will
assist the Fishery in maintaining stringent pricing (through forward and future
contacts) so that the Fishery always has a predictable stream of income. However, in
the future, we might seek to brand certain fish items that we produce. In this instance,
the Company will hire a marketing/advertising firm to properly position the
Company’s image and brand so that it can directly sell packaged fish to major
groceries, supermarkets, farmer’s markets, and select retailers.
This Fishery intends to maintain an extensive marketing campaign that will ensure
maximum visibility for the business in its targeted market. Below is an overview of
the marketing strategies and objectives of the Fishery.
Marketing Objectives
We intend to develop a relationship with major groceries and fish/seafood
wholesalers that will acquire bulk inventories from us and polish ongoing purchase
order relationships with cooperatives throughout the target market.
Pricing
Our pricing shall be as in the table below:
AGE in months PRICE (N)
Fingerling up to 1 30
Juvenile 2 50
Table Size 6 1000 per kg
Brood Stock 8 and above 2500 per kg
The price of various categories of our fish shall be average prices and compete on
quality and service. Our intended customers really make their purchase decisions
mostly on price, so we are better off remaining average. Our credit policy shall be
cash and carry so that our customers would always come with their money.
Economics
As stated in the executive summary, we intend to develop the Fishery as a multi-fish
producing farm that will spawn, grow, and distribute its fish to seafood wholesalers
throughout the target market. We already have the potential land, but the equipment
that will be used for the Fishery’s operations would be sourced. Additionally, it
should be noted that we will join a fishery cooperative that will assist with the
distribution and sale of the fish.
Facts about our industry:
The size of the market is as huge as the population of Nigeria because everybody eats
catfish but, the only problem is affordability because disposable income is on the
decline.
Our percentage share of this market is as good as 0 because 1,000 pieces of catfish
per year mean nothing to the Nigerian market. The important thing is that we shall
finish selling output and continue to grow.
The current demand in the target market is that of the sellers’ market because total
supply is far below demand.
Catfish production would grow to such a time when fish processors would also enter
the scene. The little that is produced now is just not enough for processing and
packaging, it is just consumed.
Growth potential and opportunity for a business of our size are limitless.
However, we are faced with the under listed barriers of entry into this market:
High capital costs
High production costs
High marketing costs
Consumer brand recognition
Training and skills
Unique technology and patents
Unions
Shipping costs
To surmount the above barriers, however, we have of course plunged into the
business and begin to eliminate them one after the other from our comfort zone.
Apart from natural disasters, we do not foresee any adverse effect on our business as
a result of a change in technology since we are currently almost manual in our
operations. Change in government regulations most likely would favour us as it must
be a ban on imported fish. There is no way change in the economy, no matter how
bad, would affect the total rejection of catfish by man.
Product
We have described our products and services under the Products and Services section
above as we see them. Now follows their description from our customers’ point of
view.
Features and Benefits
Fingerling production shall be within one month order. This will enable us to produce
and supply any number demanded by our customers. We shall not be selling the last
grade of fingerlings to our customers rather; we will grow them ourselves for dried
fish purposes only. We must use daphnia or artemia to raise our fingerlings, for 2
weeks at least, to enable our fish longevity. What we have said so far also applies to
our juvenile, which is grown with balanced rations. When you feed animals regularly
with balanced rations, they grow out having more density and are testier because they
had all they needed. Our table size shall be after 6 months, weighing between 1 and
3kg. As for the bloodstocks, we must make sure they stay up to 8 months and their
eggs brown, before declaring them for sale.
Apart from the testy and palatable aroma and sensation we derive from catfish in our
food, the importance of fish protein and oil in our diet and our body system can never
be over-emphasized. Please consult a medical doctor for the importance of seafood to
us.
In doing our business, we will be contributing to the reduction of unemployment by
employing as much as will be profitable to us.
Our after-sale services will include delivery, service contracts, support for
processing, follow-up on startup fish farms, and refund policy.
Customers
Our customer base cuts across all religions, ages, gender, location, social class,
educational level, and occupations. However, point-and-kill catfish is for middle and
high-income levels, while the dried one would readily be available to the low-income
earners.
For business customers, we have open markets, restaurants, and grocery shops.
Nigeria is yet to witness the entry of fish processing factories, so we are not thinking
of them for now, especially with our small capital base: N1.5m.
Competition
Most fish farmers around us depend on imported fish feed with its huge overhead
cost. We intend to formulate our own feed which will be nutritive enough but
cheaper, translating into higher profits even when we sell cheaper. Although all the
fish farmers put together cannot yet saturate the market because all of us are currently
very small-scale farmers. So, competition is too early to be given consideration in
catfish production in the Nigerian context, but we shall prepare ourselves in
readiness. Imported frozen fish is not catfish and tests different.
Of cause, we still envisage indirect competition, from meat, for example, beef, pork,
chicken, snail, goat meat, frozen fish, stockfish. Again, meat tests different from fish.
Other fish farmers are excluded because put together, we cannot produce enough for
now. The competition is only on certain customers because a customer who wants a
point-and-kill must have catfish or nothing at all.
Competitive Analysis would have been necessarily had it been that the fish farming
business has become institutionalized in Nigeria, but the reverse is the case.
Niche
Our unique corner of the market is just to start producing table size catfish for
resellers, restaurants, etc.
Strategy
Our strategy shall be phone call and messaging and personal contacts to inform our
readiness to sale at maturity and average prices.
Promotion
Advertising: phone calls, short text messages, posters and handbills.
We shall also use other methods such as dealer incentives, word of mouth and
network of friends or professionals.
We want to project success to our customers so that they would see us as successful
catfish farmers.
In addition to advertising, we plan to have graphic image support. This would include
things like logo design, cards and letterhead, brochures, signage, and interior designs
for customer visits.
We would computerize our operations, identify repeat customers and then
systematically contact and reward them accordingly.
Promotional Budget
We have budgeted N150,000.00 (One Hundred and Fifty Thousand Naira) for
promotions.
Proposed Location
We do not yet have a precise permanent location picked out yet. That is why we are
starting to run from home for a while with mobile fish ponds, before pinpointing a
permanent location and concrete/earthen ponds.
Our current location is motorable and highly accessible, convenient with enough
parking space. Whether rain or sunshine the compound has enough shade.
Distribution Channels
Our distribution channel shall be retail for families, wholesale for resellers, agents,
and independent representatives who might want some commission are also
welcome.
Sales Forecast
Except for 10% mortality, which is provided for in any animal husbandry outfit, we
forecast 95% sales of our output. We, therefore, predict an annual growth rate of
45%. The loan would have a 2-year term with a 10% interest rate.
Operational Plan
The daily operation of the business is as simple as manually feeding the fish twice a
day, between 6 am and 8 am and 5 pm and 7 pm. While doing this we make sure that
¼ volume of water flows out and is replaced every day.
Production
The ponds are washed, fertilized, and stocked with fingerlings; manual feeding
continues for 6 months when maturity is achieved.
Aerated water constantly flows through the pond to achieve an artificial stream.
Depending on the age and size of the fish, the correct size of feed, measured in mm,
is used in the feeding.
Customers are placed on notice when the fish will mature.
Daily feed consumption is noted to ensure that we have enough for 1 month before
restocking.
Our consultant is always handy to assist our product development and general
support.
Location
We would prefer a sloppy topography or a location with an adequate drainage system
so that discharging our wastewater would not waterlog the environment.
Physical requirements of a plot of land, measuring 100 by 100 feet, would be ok for a
start. A small office, store, fishponds, overhead tanks, water borehole, and
powerhouse. Electricity is very important.
Access to our location is excellent, we have excellent proximity to freeways, airports,
railroads, and seaports.
The only unavoidable construction needed for a start now is 2 units of 10 feet by 10
feet mobile fishponds.
Legal Environment
We shall register our business with CAC (Corporate Affairs Commission) and
affiliate with an appropriate cooperative in Umuahia South LGA. Affiliation with
NASSI (Nigerian Association of Small-Scale Industrialists) and AFAN (All Farmers
Association of Nigeria) will be also pursued. There is no law prohibiting fish farming
and so no permit is required to practice. The loan amount shall be insured by NAIC
(Nigerian Agricultural Insurance Corporation).
Personnel
The number of employees shall be 2 for a start, the type of labor shall be skilled,
professional input shall be on consultation. We shall get the right employees by
personal contact; those staff will receive training. Their salary shall be in line with
the labor market and as applicable in our industry. Over time, we shall evolve a
schedule and written procedures and job descriptions for employees. Surely, for
certain functions, contract workers must be used in addition to employees.
Inventory
The major inventory in this business is fish and the feed, with some fuel to pump
water. We shall also keep feed raw materials since we intend to formulate and
prepare our own feed. We are looking at an inventory investment of N480,000.00
(Four Hundred and eighty Thousand Naira only). The lead time for orders is 1 month.
Suppliers
Key supplier for fish feed is Zyex Nigeria Limited, Obizi, Amakama, Olokoro,
Umuahis South LGA, Abia State. You can request any quantity from them, their
credit policy is cash and carry. Their feed is nutritious and highly fortified with
vitamins and minerals. It is also noted that supply costs are always on the increase,
hence the option to formulate and produce our own feed.
Credit Policies
We do not plan to sell on credit because it is not customary in this industry and
clients would neither be expecting it.
Management and Organization
My Business Name will manage the business on a day-to-day basis. She has post-
NYSC experience coupled with the training she received from Zyex Nigeria Limited,
who is also in constant consultation and SEEDC (South East Entrepreneurship
Development Centre). She has distinctive competencies in accounting, management,
communication, and marketing. The plan is to train everyone in the family/company
as a way of ensuring continuity.
Professional and Advisory Support
Board of directors:
Attorney:
Accountant:
Insurance agent:
Banker:
Consultants:
Mentors and key advisors:
Personal Financial Statement
Stockholder Assets Liability
30% 1,000,000.00 100,000.00
50% 500,000.00 0
20% 150,000.00 0
Startup Expenses and Capitalization
fish farming business plan - startup expenses
Financial Plan
Our financial plan consists of a 24-months (2years) cash-flow projection and a break-
even calculation. Together they constitute a reasonable estimate of our company’s
financial future. More importantly, we hereby present the financial insight into the
inner financial workings of our company.
24-Months (2-years) Profit and Loss Projection
As is evident in our 2-year Cash Flow in the table below, with a loan of N1.5m we
will be able to generate 2,052,000. We project 2 sales within the year, that is every 6
months. After the sales, we restock our ponds and the cycle is repeated. We assume
that each fish will grow out into 2 kilograms. This is not generally the case as the
weights vary between 1kg and 3kg at grow out.
From the above projection, it can be seen that we will be able to repay the N1.5m
(One Million Five Hundred Thousand Naira) loan within one year but, we prefer the
repayment spread over 3-years with the 1-year moratorium.
Business Plan Projected Cash Flow
The profit projection is the heart of our business plan, cash flow is the blood that the
heart pumps.
The preliminary expenses in the TOTAL under 2-months 934,833 Naira, plus
recurrent monthly expenditure bringing it to (1,114,167) for the first five months
before sales in the following month.
We want to stop at the above explanation until we start having live operating data and
then a real Cash Flow.
