THE POLYTECHNIC

FACULTY OF COMMERCE
DEPARTMENT OF MANAGEMENT STUDIES

PRESENTED TO: DR KIZITO KANYOMA

PRESENTED BY:

MODULE:

ASSIGNMENT:
BUSINESS PLAN FOR A SMALL BUSINESS START UP

SUBMITTED ON: 14/01/2022

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Business Plan

BIN 2 FERTILISER

Fertilizer for food from food

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I. Table of Contents

I. Table of Contents……………………………………………………………………..3

II. Executive Summary…………………………………………………………………...4

III. General Company Description.............................................................................5

IV Products and Services………………………………………………………………….6

V. Industry Profile.......................................................................................................7

VI. Competitor Analysis...............................................................................................8

VII. Marketing Plan........................................................................................................9

VIII. Plan of Operation..................................................................................................10

IX. Financial Forecast..................................................................................................11

X. Conclusion.............................................................................................................14

XI. References..............................................................................................................15

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II. Executive Summary

BIN 2 FERTILISER is a business startup aiming at meeting the needs of people who lead
a healthy lifestyle. These people are involved in exercising and eating organic food to
maintain a healthy body.

The company aims at contributing to reduction of environmental pollution by using

food waste to create organic fertilizer (Bin 2 Farmer Organic Fertilizer) which will be
used in the farm to produce organic food. Raw materials for fertilizer production will
be collected from urban centers where there is massive waste of food.

The company is expected to realize a profit of K2 million in 2024 after incurring losses
in 2022 and 2023. Profitability will be affected in the first two years due to expenditure
on equipment and buying farm land.

Further, marketing and stakeholder relationships will create brand awareness resulting
product acceptance and increase in revenue in 2023 and 2024.

Marketing of BIN 2 FERTLISER will focus on creating partnerships with organisations

working in the environment, especially those concerned with environmental
conservation. Clubs and groups promoting a healthy lifestyle will act as brand
promoters.

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III. Business Context
BIN 2 FERTILISER is a food waste management company. Born from the idea that food
waste is polluting the natural environment and that Malawians are experiencing acute
shortage of fertilizer, BIN 2 FERTILISER creates organic fertilizer for farmers use. The
company’s sole belief is that Malawians must get good food, that is free from harmful
chemicals. Good food can come from organic fertilizers and organic methods of
farming. BIN 2 FERTILISER business concept is concerned with environmental
friendliness. Therefore, all stakeholders must adhere to natural environment
sustainability goals to abate pollution, climate change and unnecessary diseases caused
by food chemicals.

Waste management firms, city and town assemblies and health conscious individuals
and organisations are key partners of BIN 2 FERTILISER. These will be key suppliers of
raw materials.

BIN 2 FERTILISER is a darling of the health conscious consumer and all stakeholders
concerned with environmental sustainability.

The aim of the business is to contribute to creating a healthy world through affordable
organic products.

Mission Statement: to be a trusted solution to organic products

Vision statement: a healthy world for all

Our tagline shall be fertilizer for food from food

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IV. Products and Services

BIN 2 FARMER ORGANIC FERTLISER

BIN 2 FARMER ORGANIC FERTLISER is the low cost organic fertilizer from reuse of
food waste for growing of crops.  People waste so much food every day. By recycling
this waste food, BIN 2 FERTLISER will generate organic fertilizers which are much in
demand by farmers in rural and urban areas. Research has shown that the process of
recycling does not emit any harmful or poisonous substances to people and the natural
environment. Farmers are supposed to use the fertilizer for basal and top dressing.

BIN 2 FARMER MODEL FARM

BIN 2 FARMER MODEL FARM is farm designed to produce organic plants such as
vegetables, maize and legumes. The farm will run throughout the year through
irrigation and rain fed agriculture to encourage small scale farmers to grow crops
throughout the year. Farm proceeds will feed into the operations of the fertilizer plant
and community welfare.

All activities in the farm from water management, paste and disease control to
harvesting will be organic in nature so that the health conscious consumer gets the real
value that they want.

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V. Industry Profile
Malawi has been heralded as ground zero for a green revolution in Africa. A
commitment to agricultural subsidies has substantially increased access of smallholder
farmers to modern varieties of maize and inorganic fertilizer (Snapp Sieg, 2015).
According to Sieg, the fundamental issue is soil productivity; indicated by maize
response to fertilizer, and the quality and quantity of food, fodder and fuel produced
over time. This is at the foundation of sustainability. He states that new evidence shows
soil sustainability is in jeopardy, and proposes interventions for rehabilitation of soil
productivity in Malawi.

Therefore, organic farming is one way to improve the soil because organic fertilizers
help deposit of organic matter which improves soil structure and fertility. According to
Huber M. (2011) natural fertilizers, like manure, work perfectly fine, and organic
farmers are happy to use this smellier, yet safer form of fertilizer. Further, organic foods
help reduce impact of non-communicable diseases like cancer and diabetes.

There is a growing concern towards a healthy lifestyle. The population of people who
are seen exercising and eating consciously just to ensure healthy living is growing.
Activities such as aerobics and hiking are taking center stage, just to make sure people
remain fit.

Unlike in the rural set up, where people stay fit because of manual labour, the working
urban population focuses on exercising and good food. Such a population comprises of
middle to upper class, which has money to spend on the food they want.

BIN 2 FERTLISER will promote its farm produce products to the health conscious urban
population. The fertilizer product line will be promoted to organic farmers who target
the health conscious urban population.

Currently, local farmers use inorganic fertilizer which is detrimental to the health of the
soil and consumers. Therefore, BIN 2 FERTLISER brings a solution to two problems.

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VI. Competitor Analysis
BIN 2 FERTLISER is entering a highly competitive market. Farmers are already used to
using inorganic fertilizers. Therefore, the company may face resistance to motivate
established farmers to use organic fertilizers. Key competitors are inorganic fertilizer
manufacturers such as Optichem and Malawi Fertilizer Company and a hoard of
imports.

There is also an existing organic fertilizer manufacturing company, Funani Fertilizer,

which uses animal dung and remains of field produce. The main weakness of the
company is that it does not does not have a model farm where farmers can appreciate.
The source of raw materials are also different as BIN 2 FERTLISER will use food waste
as inputs.

However, to outwit competition, BIN 2 FERTLISER will first of all focus on the already
motivated health conscious consumers and farmers whose population is growing
exponentially.

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VII. Marketing Plan

Market Entry Strategy

According to Scarborough N. and Cornwall J (2016) the quickest route to business
failure is to sell “me too” products. BIN 2 FERTILISER will produce fertliser for food from
food. This means the company will recycle food waste and produce organic fertilizer for
production of organic food. The whole aim is to remove harmful chemicals in the food.
Therefore, the value proposition of the business is; fertilizer for food from food.

Marketing Strategy
Scarborough N. and Cornwall J (2016) state that showing customer claims and
documenting customer interest are factors that prove that a profitable market exists.

Showing customer interest: Section V indicates that there is an increasing movement

for a healthy life style, which demands healthy food, exercising and flexible working
among others. BIN 2 FERTILISER has realized that this is a lucrative market which
easily accepts organic products to maintain their much sought for healthy lifestyle.

Documenting market claims: As an entry point, BIN 2 FERTILISER will target 1% of

the total population that wants a healthy life style and organic farmers who supply
organic foods to the populace.

Target market: A target market consists of a set of buyers who share common needs or
characteristics that a company decides to serve (Kotler P. and Armstrong G. 2018). BIN
2 FERTILISER targets healthy living customers. These are middle to upper income
urban dwellers that have enough money to spend on healthy food. The company also
targets organic farmers who need organic inputs for their produce. Since organic
farmers are also in business, BIN 2 FERTILISER will dedicate corporate relationship
executives.

Advertising and promotion: BIN 2 FERTILISER will have to communicate customer

value to customers and key stakeholders in order to gain support. Promotion shall be
through public relations, advertising and personal selling. Public Relations shall involve
stakeholder engagement through partnerships in green initiatives and health activities
such as aerobics and jogging or hiking. BIN 2 FERTILISER shall also engage in
environmental preservation and replenishment through reforestation.

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As a startup and an organization which targets middle to upper class consumers, BIN 2
FERTILISER will focus on social media advertising. However, personal selling and
email marketing shall take center stage for business customers such as farmers and
corporates.

Distribution: BIN 2 FERTILISER organic fertilizers will be distributed directly to

farmers while as farm produce will be sold to retailers who will in return sell to
consumers. Vendors who sell vegetables in trading centers will be allowed to buy
directly from the farm. Therefore, direct and indirect distribution approaches will be
undertaken.

Pricing: Market research has shown that organic products are highly priced on the
market because they are scarce and hard to produce. However, BIN 2 FERTILISER will
use a market penetration pricing strategy. According to Kotler P. and Armstrong G.
(2016) companies set a low initial price to penetrate the market quickly and deeply—to
attract a large number of buyers quickly and win a large market share. He states that
high sales volume results in falling costs, allowing companies to cut their prices even
further. However, BIN 2 FERTILISER will adjust prices upwards once the sizable
market share is achieved, so as to realise profit in year three (2024) as shown in section
X.

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VIII. Plan of Operation
To complete the description of the business, an entrepreneur should construct an
organization chart identifying the business’s key positions and the people who occupy
them (Scarborough N. and Cornwall J. 2016). BIN 2 FERTILISER took the legal status of
a sole trader. The company is run with two managers, the farm manager and
production manager. The farm manager shall be responsible for activities of the farm.
He or she shall be responsible for financial management, operations and marketing of
the farm. While as the production manager shall be responsible for activities of organic
fertilizer production. His or her responsibilities shall include business development,
financial management and production operations.

The business unit managers shall work hand in hand with the financial controller who
shall be responsible for financial management of the whole company.

The senior managers will be supported by staff and seasonal workers depending on
production variations.

To cut down on labour costs, some workers in the farm and at the production unit will
on part time basis.

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IX. Financial forecast
The financial forecast starts with sales forecast. Table 1 below presents a month to
month sales forecast for the year 2022. As compared to other years in table 2, BIN 2
FERTILISER will incur a loss in the year 2022 because the costs are higher than revenue.
However, due to marketing, the company may start selling more in the coming years.
Further, due to experience in the business, BIN 2 FERTILISER will produce more at a
reduced cost than the first year. Therefore, the company will start making profit in 2024,
while 2023 will see a reduction of the loss.

Table 1: 2022 Sales Forecast (12 Months)

  Jan Feb Mar April May June

Organic
Fertilizer 9,000,000.00 8,000,000.00 9,500,000.00 10,000,000.00 9,500,000.00 9,000,000.00
13,083,333.3
Model Farm
12,083,333.33 3 11,583,333.33 12,083,333.33 13,583,333.33 12,081,333.33
TOTAL 21,083,333 21,083,333 21,083,333 22,083,333 23,083,333 21,081,333

Annual
July August Sept Oct Nov Dec Totals

8,000,000.0 9,500,000.0 10,000,000. 11,000,000. 13,000,000. 13,500,000. 120,000,000

0 0 00 00 00 00 .00
14,000,000. 11,569,333. 11,083,333. 11,183,000. 11,083,332. 11,583,000. 144,999,999
00 33 33 33 33 33 .63
22,000,000 21,069,333 21,083,333 22,183,000 24,083,332 25,083,000 265,000,000

Table 2: Financial forecast

YEAR 2022 2023 2024

Estimated revenue 265,000,000.00 298,000,000.00 320,000,000.00

Estimated costs 280,000,000.00 295,000,000.00 318,000,000.00

Estimated profit or (15,000,000.00) (3,000,000.00) 2,000,000.00

loss

Capital expenditure

BIN 2 FERTILISER will need equipment for the farm and fertliser production
equipment. Equipment for the farm shall include greenhouse, irrigation kit and farm
land. Cost of equipment for the farm translates to K65 million.

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Whereas the fertilizer production unit will need production equipment. The equipment
shall include machine to extract or recycle the organic matter from food waste and a
mixer that creates the fertilizer. The equipment is estimated at K75 million.

BIN 2 FERTILISER will also need waste collection equipment and trucks which will
move around town collecting waste and deliver to the distribution plant.

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X. Conclusion

BIN 2 FERTLISER comes to break the market with products that excites the healthy
conscious consumer. It is the belief of the owners and management the company will
contribute to environmental sustainability and enabling a healthy population.

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XI. References

Kotler P and Armstrong G, (2018) Principles of Marketing. Global Edition, Pearson

Education. United Kingdom

Scarborough N. and Cornwall J (2016) Essentials of Entrepreneurship and Small

Business Management 8th Edition England: Pearson.

Snapp Sieg, (2015). A Green Revolution in Malawi: Next Steps Toward Soil
Rehabilitation and Productivity. Working Paper. Michigan State University

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