Agribusiness has in recent time dominated the general Agricultural landscape. This success can be credited to tremendous growth in industrialization, increasing demand for food and growth of the food services value chain, urbanization and improved sustained public education.
As Agribusiness is seeing increasing growth, there is the need for young graduates and startups to explore avenues in Agribusiness in the area of Sales and Commercial ventures which requires little or no capital requirements, no immediate need for office space nor expensive marketing drive.
In this epistle, I am pleased to share with you three important ways you can become a player in the booming agribusiness space with little or no resource.
To begin with, Agribusiness can be described as any business operating along the Agricultural Value Chain. In other words, the Agribusiness value chain is the integrated range of goods and services (value chain) relevant for an agricultural product to move from the stage of the producer to the final consumer.
The basic characteristic of a Value Chain is market-focused collaboration; different business enterprises working together to produce and market products and services effectively and efficiently. Value Chains allow businesses to respond to the marketplace by linking production, processing and marketing activities to market demands.
Before I delve deeper into the subject under consideration, let me tease your mind on the supply chain of the modern-day agricultural value chain. As you seek to explore this path, understand that the supply chain can be categorized
- Upstream supply chain which includes the logistical and preparations prerequisite to the main production process. Opportunities in this area may include transport, sourcing of raw materials among others.
- Mid-stream supply chain in the agricultural value chain involves the activities which concerns the real production process such as the farming process.
- Downstream Agribusiness supply chain imbibes aspects which enhance the distribution, marketing and sales of produce.
For the purpose of this epistle, let me consider a typical value chain in the livestock value chain – specifically, Poultry. This analysis shall provide for the various stages of the supply chain and for the purpose of this presentation, I shall focus on some key aspects of the value chain and key Sales business opportunities for start ups and individuals
Table of Contents
Day Old Chick Supply
The Poultry industry thrives on the supply of good quality day old to farmers and brooders. This serves as good business opportunity for startups due to the level of demand by farmers at different period of the year. Day old Chicks are produced locally by local breeders. Importation is also prevalent. Currently, Local farmers have affinity for imported birds.
To start a business in the supply of Day-Old chicks, one can begin by serving as an incubator of fertile eggs supply to interested buyers in 21 days. To do this, arrange with farmers who cross quality breeds to produce fertile eggs at premium price. The eggs are set in a good incubator and expect hatchery in 19 to 21 days. This system is not mostly ideal as most farmers do not trust the quality of the hatches.
To target the premium buyers, build partnership with major importers like Premier Poultry Ltd – who produce globally standardized parents stock farms, breed and import day old chicks for distribution to local farmers. In this model, you can sign distributorship agreement which allows you to offtake some of their birds for distribution to your customers.
You can arrange with farmers to pick up at the airport or put in place efficient delivery channels to aid the delivery of birds directly to the farmers.
Likely Challenges:
The challenges to this system are issue of integrity. Farmers are conservative most of the time. Their ability to innovate largely depend on how well your product is recommended based on previous experiences.
Feed, Medical and Logistics Supply
The poultry industry has a high demand for vaccines, vitamins and antibiotics. Drinkers, feeders, feed and more are also high on the demand curve for the poultry industry. Egg Producers also demand crates for stoking eggs.
The above illustration establishes that, one can manage a supply chain business model serving farmers in clusters or far to reach areas can be served vaccines in preserved or cold facilities, medications and other essentials. This is a major business which can be done with little resources. Liaise with major vaccine importers, and other veterinary drug suppliers, build a financing plan and you can run one of the most successful enterprises in the poultry value chain.
In the case of feed, having a unique feed formulation which enhances early stage development (Chick starter), Enhance growth (grower mash) or improve Egg performance (layer mash) is key to making major impact. You can partner with commercial feed producers such as Premier Poultry, Sankofa feed, Kudjis feed amongst others, to become a key feed distributer to a target market.
Likely Challenges:
An important threat is the possibility of the vaccines to become ineffective. Vaccines require cold facility storage and transport. In the delivery of this model, be sure to make provisions for vaccine flask so the temperature requirement is kept with ice.
In the case of feed, you may need storage facility or delivery tracks in order to ensure success depending on the target market.
Aggregation, Processing And Distribution
As an Agribusiness consultant, I have worked with a small businesses and private individuals who were focused on aggregating birds from rural areas of the country to Accra and Tema for sale. I have also served in the capacity as lead developer in my works as Sales Manager for Premier Poultry Ltd where I assisted my prospects to sell off their old birds in order to purchase mine. The birds are bought from the farmers, sold and distributed to other buyers who process it for retail buyers in the major Markets. You can also engage in the business of providing dressed and package meat to homes and businesses.
The advantage in this model is that, you are not involved in the production, hence, saved from all the challenges in the initial stages.
To be successful at this, you need to develop the down-stream channel by having buyers or plans for pick up within a few days. You also need to have reliable business leads in the various districts and regions to help in identifying farms with broilers, layers or dual purposes breed.
The opportunity in this is that you get the chance to export aggregated live birds in large quantities to neighboring countries like Ivory Coast – who depend on processed live birds over imported carcass. You may as well process for local restaurants, cold stores and for major events.
Likely Challenges:
Just as with any business, this model may experience some shocks such as mortalities of birds arising from long distance travel stress, environmental change and infections. As a beginner, be sure to put appropriate logistics in place to avoid or minimize this risk.
Another challenge worth espousing is the challenge of tides. This model experiences huge demands during the festive seasons. This can help you plan in order to be relevant and efficient.
Another important first hand knowledge you need is that, it is capital intensive due to farmers unwillingness to give way to credit facilities due to the capital-intensive nature of their business. To breakthrough, you need to have a well-planned financing model, build credibility and be consistent.
Taking the First Leap
I believe by now; you have identified your area. To begin, you need to ensure fair assessment of your skills sets, resources and careful analysis of your target group. You are urged to seek further clarification in order to understand the real need of your chosen area. At PalmHouse Ghana, we have a dedicated experienced faculty as well as a pool of stakeholders across the value chain to help to start right and scale up. Get in touch with us via [email protected] | +233241016369
About PalmHouse Ghana
The PalmHouse Ghana is an Agribusiness consultancy firm in Ghana focused on supply chain management consultancy, Commodity trading, Market reports, Sales pipeline and Distribution channel development of Agri – produce as well as providing support services to joint venture investors.
Speak to us via +233501794533 / +233241016369 | [email protected]
This article is Originally published by Bright Emmanuel Abia on 19th September, 2023. All rights reserved.
