COMMUNITY BASED FARMING
EXECUTIVE SUMMARY
www.mandifresh.co.in
INVESTMENT OPPORTUNITY PROFILE FOR
OFF SEASON VEGETABLE FARMING
This document is prepared by:
Mandi Fresh Agro Pvt. Ltd.
"Anytime fresh at your doorstep”
Mandi Fresh plans to develop several symbiotic community based farming groups that are run by a proficient and stable management system. Our effective utilization of machinery, labor and fertilizer by means of integrated farming concept and efficient water management methodology constitute an economically and environmentally viable model.
EXECUTIVE SUMMARY
To reduce the middleman chain of agriculture produce market by promoting “Consumer to become Grower” through community farming concept.
v There is a huge demand for fresh vegetables in the local and regional market. The facility of growing off-season vegetables also allows for growing non-conventional varieties and vegetables, which are in high demand in the domestic market.
v The importance of vegetables cannot be denied due to their nutritional value as these provide proteins, carbohydrates & salts that are essential ingredients for the growth of human body.
v Vegetables are used in raw form as salad or cooked food according to the taste, which provide a balanced diet and keep human being healthy. A large number of world population now prefer vegetables in their daily diet due to the awareness that vegetables provide better source of energy and nourishment to the body.
v By entering into production through advance cultivation technique we will ensure fruits & vegetable is of high quality as per international standard (level of insecticide and pesticide).
v The use of hybrid seeds provides higher yield which leads to lower unit cost.
v Chances of crop failure are almost none.
v Off-season cultivation of high value vegetables will fetch better price and provide continuous supply to the processing industries.
v Higher prices will be obtained by producing the right crops, at the right times of better quality and directly selling to the consumer through Mandi Fresh strong supply chain network.
v Vegetable and fruit market is largely unorganized; hence there is no fixed MRP of the product. A large gap exists between the farmer and the consumer, so at every stage the price escalates and if we cut these middlemen chain there is huge profit margin, even if we share some to both ends.
THE CONCEPT
v The proposed project shall be in the vicinity of Delhi NCR. The project is cultivation of farm vegetables in the off season when the prices are high.
v Low tunnel technology which is low cost and simple among several technologies available for off-season farming (low tunnel will be discussed in detail in production process) will be used.
v The product will be farm fresh vegetables, such as tomatoes, Potatoes, Turnip, Carrots, Cauliflower, Cabbage, Peas, Cucumbers, Hot peppers,, Lettuce, Onion, Spinach and other vegetables.
v On a farm of 15 Acers the produce is as detailed below.
Vegetables | Areas(Acres) | Production Quantity in (Kgs)/Acres | Total Production Quantity |
Tomato | 3 | 25,000 | 75,000 |
Cucumber | 3 | 25,000 | 75,000 |
Brinjal | 3 | 24,000 | 72,000 |
Hot Pepper | 3 | 12,000 | 36,000 |
Watermelons | 3 | 25,000 | 75,000 |
v Total capital cost of the project is a meager amount of Rs 800,000 on land of 15 Acers with good soil quality and fertilizers.
v 7 permanent employees and 4 part time employees will be required directly on the project.
PROJECT RATIONALE
v The proposed project is designed as a medium size off-season vegetable farming unit, spreading over a land area of 15 acres.
v Off-season vegetables, such as, tomatoes, potatoes cucumber, brinjal, hot pepper and will be cultivated using low tunnel technology.
v The land can be utilized for green farming during the idle period to maintain the fertility of soil
v The estimated yield potential of the farm varies according to the selected type of vegetable.
v For this project a mix of five vegetables is proposed and is listed below. For this vegetable mix it is estimated that a 15-acre farm unit will yield a total of 333,000 Kg per annum.
MARKET OPPORTUNITIES
v Delhi NCR has 74,248 ha non-agricultural land, 11,708 ha other uncultivatedland, 1,561 ha forest land, 1,267 ha under tree crops and grooves. The total percentage of agricultural land comes to 41.7 percent out of which 35 per cent is under vegetable cultivation.
v There is great demand of vegetables all year round and the price is high at the start of the season and at the end of the season. If modern techniques are applied to grow off season vegetable, high prices can be fetched. Vegetables can be cultivated in off-season, with the induction of an artificial technique like tunnel technology, in which temperature and moisture is controlled for specific growth of vegetables.
v Availability of rail, road and air transport, coldstorage, processing units, export houses and well established market network, will be helpful for taking up vegetable cultivation in Peri-urban areas of Delhi NCR in an organised way.
v Also, a huge quantity of solid waste generated during handling and marketing of fresh vegetable produce in NCR, Delhi, which is creating health and environmental hazards, can be used or recycled to produce vermicompost, etc., or use in organic vegetable production.
v Community farming is likely to result in a social symbiosis between farmers and city dwellers with mutual benefits and advantages.
v Major vegetables grown in and around Delhi include cauliflower, cabbage, carrot, spinach mustard (leaves), cucurbits, okra, brinjal and tomato. In addition, culinary herbs such as fenugreek and coriander are also cultivated.
BUSINESS PLAN ( Cultivation Approach )
v Most modern and cost effective farming techniques will be employed to produce greater yield of the vegetables. Also those vegetables will be grown which have highest demand.
v Round the year cultivation of vegetables and fruits (offseason and in season)
v Integrated farming with the introduction of fishery, poultry, dairy, mushroom cultivation, honey bee production.
v Use of Integrated pest management (IPM), integrated nutrient management (INM), and good agriculture practices (GAP) practices.
v Forming farmers association and providing training on integrated farming from government agencies.
v Building a team of agripreneurs and getting financial loan and subsidy support of government
v Marketing distribution and channels will be developed so that the vegetables reach the market in the least time.
Product sales
The expected sales of vegetables is given below.
Vegetables | Land (Acres) | Production/Acer | Annual production | | Annual revenue |
Tomato | 3 | 25,000 | 75,000 | 10 | 750,000 |
Potatoes | 3 | 25,000 | 75,000 | 7 | 525,000 |
Hot Pepper | 3 | 12,000 | 36,000 | 15 | 540,000 |
Cucumber | 3 | 24,000 | 72,000 | 8 | 576,000 |
Brinjal | 3 | 25,000 | 75,000 | 10 | 750,000 |
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| Total | 3,141,000 |
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Raw Materials.
Land 15 Acers with good soil quality. Fertilizers will also be required. Hybrid seed of
different vegetables. The seed prices as well as their cost per acre are detailed below.
Other material cost is also as detailed below.
Crop Assumption | Cost per Seed in Rs | Average Seed Requirement in unit / Acre | Average Seed Price / Acre |
Tomato | 0.45 | 15,000 | 6,750 |
Brinjal | 0.45 | 15,000 | 6,750 |
Cucumber | 1.35 | 15,000 | 20,250 |
Hot Pepper | 0.5 | 15,000 | 7,500 |
Watermelon | 0.25 | 6,000 | 1,500 |
Other material cost is also as detailed below. |
Water Cost Per Irrigation per Acres (Rs) | 200 |
Pesticide Requirement per Acre per Year (Rs) | 7,500 |
Fertilizer Cost per Acre per Year (Rs) | 7,500 |
PRODUCT MANUFACTURING PROCESS
The production flow varies slightly for different vegetables. The following production flow
is based on the production of tomatoes.
v Sowing of seeds in a separate plot of land for nursery.
v Preparation of seed beds in the field for cultivation of vegetables.
v Using fertilizer in the soil to maintain its fertility.
v Transplantation of nursery in the soil or sowing of seeds directly in the soil.
v Maintaining level of moisture in the soil.
v Protection from the pests, diseases and other wild growths by using pesticides/sprays of chemicals, and trimming.
v Using fertilizer of different varieties for the smooth growth of plantation.
v Picking/harvesting at various times as per nature/requirement of the plantation.
v Grading of crop on the basis of quality and other standards.
v Application of post harvesting technology for picking/plucking, packing and storing
v the vegetables in order to fetch the maximum price. Transportation to the sale points in local or export markets.
MARKETING CHANNELS
The final product will directly supply to the consumer eliminating role of intermediaries through Community based Farming.
HUMAN RESOURCE REQUIREMENT
The Human resources at farm are depicted below in tabular form..
Description | Number | Monthly Salary | Annual Salary (Rs) |
Farmer Manager | 1 | 5,000 | 60,000 |
Labor | 5 | 3500 | 210,000 |
Guard | 1 | 3000 | 36,000 |
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| Total | 306,000 |
Apart from the above mentioned staff requirement part time workers for three month will be required during the picking season. Following table shows the part time staff requirement:
Part Time Staff Requirement
Description | Number | Salary (per Day) (Rs) | Salary per Month (Rs) |
Labor | 4 | 50 | 1,500 |
PROJECT FINANCIALS
Operational Data
All land will be cultivated from year one, so full capacity will be utilized.
Raw materials
Tunnel material i.e. mild steel bar, Plastic Sheet, Iron Wire, Bamboo, is available locally from different suppliers. Fertilizers of all kinds are available locally. Pesticides of different natures are also available locally. Water is available from canal.
Fixed Cost
Investment in the fixed assets to the tune of Rs 795,300 will be required for the vegetable farm, as shown below.
Description | Cost (in Rs) |
Building & Civil works | 225,000 |
Plant & Machinery | 107,500 |
Furniture & Fixture | 50,000 |
Vechicle | 350,000 |
Pre-Operation Cost | 62,800 |
Total Fixed Cost | 795,300 |
Working Capital
The working capital required for the farm is Rs 166,227 as detailed below.
Cash | 41.227 |
Equipment Spare Parts Inventory | 5,000 |
Up-Front Land Lease | 120,000 |
Total Working Capital | 166,227 |
Overheads
Following Overheads are assumed to occur in the first year of production
Expense | Year Amount |
Utilities | Rs 36,000 |
Depreciation | Rs 62,000 |
| Rs 333,000 |
Packing | Rs 333,000 |
Admin and Selling | Rs 26,700 |
Admin salaries | Rs 21,600 |
Total | 812,300 |
FINANCIAL SUMMARY
Sales | Rs 30,00,000 |
Gross Profit Margin | 44% |
Net Profit Margin | 12% |
Internal Rate of Return | 61% |
Net Present Value (14%) | 1,593,717 |
Management Team
v Shilu Sinha (Founder): An Agriculture engineer and MBA Sales & Marketing from Pune University. Shilu has 4 years of agriculture marketing and cultivation experience. v Jayant Sinha: B.E Production and MBA in Supply chain from NITIE, Mumbai. Jayant has 9 years of supply chain and IT consulting experience globally. Worked with Accenture USA Consulting. v Prashant Shekhar: MBA Marketing from Pune University. Prashant has 4 years of retail operation, procurement and sales experience. v Annu Sinha: Graduate and Advance diploma from NIIT. Annu has 6 years of experience in managing human resources, call center support & system support.
Advisors
v Deepak Rao: Deepak has Engineering and MBA degree in supply chain management. Deepak is based out of USA and having 9 years of vast experience in supply chain and IT v Sutirtha Sinha: Sutirtha has done engineering from IIT Kharagpur and MBA from IIM Kolkata. He has over 11 years of experience in business development and sales.
v Rajeev Ranjan: Rajeev is a production engineer from BIT Sindri. He has 11 years of enriching experience in account relationship management and strategy.
For further information please contact:
Shilu Sinha
B.Sc (Agri Eng) & MBA (Marketing)
(Director)
+91-9910035164
+91-9560158973
