NAME: AGWALLA DAVID OGECHUKWU

COURSE CODE: AFE 202

DEPARTMENT: MEDIA AND COMMUNICATION STUDIES
LEVEL: 200
MATRIC NUMBER: 18/SMS04/004
Agwalla Hydroponics Farm Business Plan
Executive Summary
Introduction

Agwalla Farm will be a project built around a highly successful businessman and the

development and training of skilled and semi-skilled staff in the hydroponics and instant turf

market. The project aim is to carry out intensive and high turnover production, off a small area,

while providing work and leadership experience for local women.

The company is a combination of cutting edge, high quality, efficient food technology and
production. It is committed to the improvement of taste in vegetables and excellent quality and
nutritional value.

The company will provide education, experience and research in the hydroponic field. It has the
experience and extensive knowledge of well-known grower Mike Shelly as a consultant.

This project will be KZN-based, and will supply vegetables for the national and international
markets, and instant turf for the local market.

Products
The 4 main crops to be grown will be instant turf, long life tomatoes, cucumbers, and coloured
peppers.
Tomatoes: 4ha under plastic which will produce 2100 000 kgs per year
Cucumbers: 1ha under plastic which will produce 205 000 kgs per year
Peppers: 1ha under plastic which will produce 250 000 kgs per year
Turf: 30ha in the open.
Financial considerations
The company is seeking both short-term and long-term funding to finance the purchase of a new
farm and development costs of the project.
This will cover startup expenses and first year loses. It is estimated that the company will begin
to make a profit in year 2 of operations.

The project is expected to begin production within 8 months from start of the first tunnel being
erected.

1.1 Objectives
The objective of this project is to establish an intensive farm, producing high-quality produce for
both the national and international market year round.

1.2 Mission
Agwalla Farm is a KZN-based company with a two-fold mission:

 to produce high quality, nutritional, and flavourful vegetables for consumption in both local
and international markets.
 to create opportunities for leadership and highly productive teamwork for local women who
work on the farm.
The women working on the farm will be organized into intensive work groups, and each group
will be paid incentives on production and performances, in addition to the standard wages.

1.3 Keys to Success

 Efficient production utilizing greenhouses.
 No existing projects of this magnitude in the KZN region.
 Experience in the vegetable industry goes back to 1996.

Company Summary
Agwalla Farm will be a partnership of successful businessmen developing a small farm into a
highly productive hydroponics and instant turf project.

Hydroponics is the growing of high-quality vegetables in high-tech, multi-span greenhouses. The

produce is grown in 15L bags with a medium used to support the root system. The plants are
automatically fed nutrients through irrigation systems.

The plants are grown in the best suitable growing conditions, which allows each plant to produce
the maximum fruit possible.
Instant turf will be grown out in open field production. The turf will be irrigated via overhead
spray units, using the run-off fertilizer from the multispan tunnels.

This fertilizer is highly effective and will provide all the requirements the instant turf will
require. The turf will be cut and sold by the square meter, and is harvested with a sod cutter.
The company will concentrate on the production of tomatoes, peppers and cucumbers in the
tunnels, and in time will pursue more selective vegetables and the fresh cut flower market.

2.1 Company Ownership

Agwalla Farm is owned jointly by its two founders, one of whom will serve as the project
manager.

2.2 Start-up Summary

The company is seeking to raise investment for the purpose of financing the acquisition of the
vegetable farm, facilities modifications, multi-spans and equipment, and funding operating
expenses.

Facilities
The operation will utilise :

 Six large greenhouses enclosing the vegetable area

 irrigation, fertilization, temperature control and water treatment devices
 outdoor production of instant lawn
 pack houses and washbay facilities
 business office building
An additional portion of the operation will be the growing of instant lawn. Local landscape
operations have trouble with meeting the demands of instant turf supply, and the company has
recognised the need in the market.

The company plans to supply the local nurseries and landscapers with top quality, premium
garden lawn.

The largest portion of the start-up requirements is for purchase of the site and construction of the
necessary buildings and infrastructure, including well-digging. These are listed below as long-
term assets.

The start-up period is five months long, and includes construction and one and a half months for
growing the first crops, to be sold beginning in July.
Products
Hydroponics is the production of vegetables in state-of-the-art, temperature-controlled, multi-
span tunnels. The structures being used are richelle multi-spans, which come complete with
computer temperature sensors, automatic opening and closing vents, automatic misting units and
temperature controlled fans. The advantages of growing in high-tech tunnels are:

 faster, longer growth

 harvest labour reduced by 80%
 harvest time reduced, and by doing so:
 decrease loss in weight gain
 eliminate weight loss from shock
 allow greater yield per plant
 provide optimum temperature for plant growth
Vegetables
Agwalla Farm’s first line of production will be tomatoes, peppers and cucumbers. The farm will
have the capacity sufficient to produce in excess of 2 550 000 kg of vegetables per year.
Instant lawn
The company’s outdoor horticultural aspects include the production of 30ha of instant lawn. The
company will sell between 20 – 25ha per annum.
Research and development
The company will seek contact with local and international companies in order to learn about
and acquire new hybrids of vegetables that are hardier and grow faster in our local climate.
These and other available species and systems will be constantly tracked.
In addition to the above, the company will seek contacts at universities and researchers that are
involved in greens, and will continue the quest for the best flavoured, large, and firm vegetable
throughout the year.

Future product plans

In the future the company would like to explore the possibility of flower production. Agwalla
Farm believes this to be a high revenue venture, which, if successful, could become our number
one endeavour.
We are also considering the production of bananas. Currently there is a huge shortage of
bananas, and the selling price has been above average for the past 2 years.

Market Analysis Summary

In an era of big-box food stores, when 4 major grocery chains control the purchase of vegetables,
the proliferation of open air markets has come out of nowhere, giving more consumers an option
to purchase fresh vegetables.
Such markets include retailers such as Fruit and Veg City and VegExpress. Agwalla Farm will
not only supply the major supermarkets, but also the markets mentioned above.
With these trends in mind, Agwalla Farm will also concentrate on wholesale live vegetable
markets that sell hydroponic produce, fresh farmers’ markets, and export to neighbouring states
and international markets.

4.1 Market Segmentation

For the purposes of this plan, we are focusing on retail outlets and VegCity shops within 45
miles of our location.

4.2 Target Market Segment Strategy

The target customers include the major retail outlets and export markets for the vegetables.

The target customers for instant lawn include nursery and garden centres, landscapers, and
private customers.

4.3 Industry Analysis

The hydroponic industry is still fairly new in the Nigerian market, in terms of research and the
number of completely developed farms. The biggest negative is the start-up costs to erect a fully
state-of-the-art project. Therefore, if a project is going to be developed, two major factors need to
be taken into account.

Selected Markets. Due to high quality, vegetables must be sold retail outlets, etc. to retrieve
highest price.
Project size. The project must be able to supply produce all year round; if not, retail outlets will
not be interested.
The Industry is still small, and therefore a project of this magnitude will create interest among all
the major veg outlet markets.

4.3.1 Competition and Buying Patterns

Agwalla Farm aims to be the biggest growers of hydroponics in the KZN region. At present there
are very few big growers, minimizing the competition.

The advantage of hydroponics on a large scale is the availability to produce vegetables all year
round in large quantities. This immediately becomes a positive factor with major retail outlets
and exporters.