2. Agri-Business Planning Steps

Planning is a major ingredient in any successful business process. The facts are that :      

• Most  Farmer organizations operate without formal plans
• New businesses are often too busy and have little time to plan
• Mature businesses argue that they have always done well without them

The beginning point for farming as business should be having this discussion as a group

Step 1: Diagnosis and Finding Opportunity

Read this story and answer the questions below

After completing his primary education, Gasore had left his village to seek a job in the city. While the city life had been exciting, and he had found several work opportunities, it had also been a hard living. Gasore father was now too old to be managing the 1-acre family farm land by himself, and Gasore was now happy to return home. However, he wanted to make sure that he would be earning enough to support his family on a long-term basis. For this, he needed to know the current farming practices and see what could be done to raise the income generated by the land.

Upon return, Gasore started talking to the farmers in his own village, so that he could find out what crops were being grown in the area. He realized that most farmers were growing the same crops: beans, onions and maize. When asked why, they said because everyone else did; it was what they had always grown. He also learnt that these farmers were selling their produce to the first buyer who came to the farm.

As a next step, Gasore decided to find out other products could be produced in the area. He went to the nearest town where he talked to shopkeepers and traders, and found out that there was a high demand for garlic. Gasore knew that growing garlic was like growing onions, so it would not be difficult to produce. He also found three shopkeepers who said that they would buy garlic from him, provided it was of good quality. They said they normally paid RWF 100 per kg.

Before investing in garlic production, Gasore realized that he needed to know if he could make a profit by growing and selling garlic at the market rate. He visited a neighboring village, where farmers helped him calculate how profitable garlic.

As a final step, Gasore approached an extension worker from the local community organization who advised him to start garlic production by planting ¼ an acre with the new crop. The extension worker told him he should be able to harvest about 750 kg to 1000 kg per acre, so on ¼ acre, he should be able to produce between 190 and 250 kg of garlic.

After completing his investigations, Gasore decided to grow garlic on ¼ acre of his farm and plant beans, onions and maize on the rest of the land.

Questions

1. What did Gasore  realize about the farmers in his village?
2. What did Gasore decide to do? How did he do it? Why is this important?
3. What did Gasore learn from his visit to the market (shopkeepers and traders?)
4. What did Gasore decide to do? Why could he be confident about this?

Read the Story and answer the questions below

Based on what he had learnt from the market, the other farmers and from the extension worker, Gasore  set himself a goal of growing ¼ acres of garlic and marketing it to the three nearby shopkeepers. He figured out that if he sold 250 kg of garlic, he would obtain a total sales income of RWF 12,500. But in order to calculate the profit he could make, he first needed to know the costs of the inputs that would be used to grow and sell the crop.

Gasore listed the primary inputs he would need to grow the garlic,i.e. seed, fertilizer, pesticides, labour, small net bags in which the garlic would be packed, etc. He also factored in the cost of transporting the garlic from his farm to the shops. He calculated that all these inputs would cost him RWF 3,500, meaning that he could expect a total profit of RWF 9000 from garlic production.

Of course, Gasore now needed to implement his plan, i.e. buy the immediate inputs, organize labour, prepare his land and plant the crop. In addition, when the crop was ready, he also had to organize its packing and transportation.

Questions

1. What was Gasore plan?
2. Can the group come up with a joint plan on their production and each farmer plans what they are going to produce and what size of land is going to be allocated what crop?

Read the Story below and answer the questions below

When Gasore had organized all the inputs, he prepared his land and planted the garlic seeds. Within a month, however, Gasore realized that the germination was poor and the growth of the garlic was not as expected. He went to the extension worker for advice, who told him to replant using a different variety of seed. Even though this was an extra cost for Gasore, he obtained new seeds for planting, knowing that he had made a promise to several buyers in the market to supply good quality garlic. He did quick calculations and knew that he would still make a profit.

Knowing that the crop would now be delayed by at least a month, he made new arrangements for transport. This did not cost him anything extra. The second time, the germination was much better. A few weeks later, Gasore garlic was almost ready and it was looking good.

Close to harvest time, Gasore purchased the packaging he needed to market his garlic to the three shops. Very shortly thereafter, Gasore harvested his garlic. He was a month later than expected, but it was worth it.

Questions

1. What happened after Gasore planted his garlic? What did he do about it? Why?
2. When it got close to harvesting time, what did Gasore do?

Read the story below and answer questions

As the garlic was harvested from the field, it was checked and cleaned. The bad cloves were thrown away, while the rest was packed into the net bags and put into boxes. When everything was weighed, Gasore discovered that he had 200 kgs. It was a little less than expected, but based on his calculations, Gasore knew that he would still make a profit.

The transport arrived as planned. The boxes were loaded onto the vehicle and Gasore took his garlic to the three shopkeepers. Initially, the first shop refused to take his garlic since Gasore was one month late. However, Gasore showed the shopkeeper the quality of his produce and convinced him to buy it.

The second shopkeeper agreed to take the product, but wanted to pay Gasore after sixty days. Gasore explained that this was his first crop and he wanted to keep selling to this shopkeeper, but could not if they could not make a better deal on payment. In this way, Gasore persuaded the shopkeeper to pay 50 percent immediately and 50 percent after sixty days.

The third shopkeeper refused to pay the agreed price. He said that he was able to get cheaper garlic from another farmer. Again, Gasore showed the shopkeeper the quality of the product. He also told him that his competitors had bought the garlic at the agreed price. In this way, Gasore convinced the shopkeeper to pay the agreed price – in cash.

Questions

1. The harvesting and packaging went well. What happened when Gasore took the garlic to the three shopkeepers? In addition, what did he do about it? Why?