Final Project
Content
1:
³FOOD AND SAFETY ,HAND IN HAND´
TEAM MEMBERS: ZEESHANA MUSHTAQ AS CEO AFSHAN GAZI AS CMO KHURSHID MIR AS COO RAFIE MALIK AS CFO DEPARTMENT OF SBS ISLAMIC UNIVERSITY OF SCIENCE AND TECHNOLOGY(IUST) AWANTIPORA PULWAMA KASHMIR
TABLE OF CONTENTS
1. EXECUTIVE SUMMARY««««««««PAGE 2,PAGE 3 2. COMPANY SUMMARY«««««««««PAGE 4
3.
PRODUCTS AND SERVICES««««««PAGE 4,5
4. MARKET ANALYSIS SUMMARY««««PAGE 5,6
5. STRATEGY AND IMPLEMENTATION SUMMARY ««..« PAGE 7, 8.
6. OPERATION MANAGEMENT«««««.PAGE 8 TO 13
7. WEB PLAN SUMMARY«««««.«««PAGE 13.
8. MANAGEMENT SUMMARY««««««PAGE 14.
9. FINANCIAL PLAN««««.««««««PAGE 14 TO 19
10. APPENDICES ««««««««««««PAGE 20
1.0 EXECUTIVE SUMMARY Our project is about the conversion of the waste resources of APPLE POMACE into a safe and nutritional feed in order to counter difficulties being faced in providing sufficient and nutritious food for the live stock population. Since the cost of feed is very high and in recent years the price of conventional or basic feeding ingredients has tremendously increased, this has made live stock production very expensive. It is the need of the time to utilize unconventional feeds like agro industrial by-products to make a balanced feed which in addition will be freeing our environment of the various threats. Our project attempts to set an example for the efficient utilization of the wasted food resource ± APPLE POMACE by producing multienzyme bio-feed, biodegrade the antinutritional factors such as pectin and tannins in apple pomace, and obtain the nutritional enrichment of the fermented substrate. Undumped and untreated deposits of apple pomace has caused serious environmental problems.
Indian apple production averages nearly 2 million tonnes during 2009-10 making it the seventh largest producer of apples in the world. Nearly all of India¶s apples are grown in three mountainous states in north India- Himachal Pradesh, Jammu and Kashmir and Uttarakhand. Himachal Pradesh and Jammu and Kashmir each have roughly equal area planted to apples, but Jammu and Kashmir has the highest average yield and accounts for about two-third of the total production which stands as a base for our business idea and gives us an absolute advantage over other regions. Apple processing industries are one of the major industries of these states like juices, concentrates, wine, cider, canned slices, etc. Food industry In general generates a large quantity of wastes i.e peel, seed , pomace, rags, kernels etc which is biodegradable in nature. Due to richness in carbohydrates, dietary fibres and minerals, such wastes have the potential to support the growth of microorganisms involved in the production of various products. Apple pomace - a by-product of juice processing industry, represents about 25-35% of the weight of the fresh apple processed. is a rich source of many nutrients including carbohydrates, minerals, fibres except protein. Its disposal in the environment, being highly biodegradable (very high BOD), results in production of foul smell and affects the aquatic life since large amounts of the waste are dumped in various water bodies which compels for its proper treatment. Apple pomace has been utilized as an animal feed as such or after ensilage but due to low digestible proteins was not considered suitable as an animal feed. Attempt to increase the quantity of protein was made by addition of non-protein nitrogen to apple pomace but it led to birth of dead or weak calves Utilization of such a waste in an economical and effective way would be in the interest of prevention of resource wastage and better economy of the processing plants and hence provides a great business opportunity.
This project calculates the costs of starting a small venture with a list of all necessary purchases including tangible assets( for example equipment, and inventory) and services, working capital, sources , collateral and market feasibility and relevance of the firm with real market test and thee various strategies both pre and post launch and also various marketing tools to be used. VISION STATEMENT To strive for the development of a sustainable industry that acts responsible within the food chain by ensuring safe and nutritious feed for safe food. MISSION STATEMENT Company aimed at offering high-quality, moderately priced feeds using only natural ingredients. We view ourselves as partners with our customers, our employees, our community and our environment. We aim to become a regionally recognized brand name. We are building a business in which high standards permeate all aspects of our company. Quality is a state of mind at our company. GOALS/OBJECTIVES
y
y y y y y y
Our goal is moderate growth, annual profitability. To expand distribution channels of the company. To create a strong research &development base in unconventional feeds. To complete all planned projects within scheduled time and approved cost. To have loyal customers and provide complete value for money to clients. Use our innovative approach that will help firm to uncover new opportunities. Always take feedback from our customers.
Keys to Success
The keys to success for APPO VALLEY FEED are: 1. Investment capital to provide eco friendly feed favoring environment positively, and deliver a value-added product that produces cost savings for customers that far exceed the product cost. Aggressive marketing to introduce long-term care providers to the significant cost/benefit advantages of APPO VALLEY FEED. Product quality, ease of use, world-class customer service and support. Price competitiveness.
2.
3. 4.
2.0 COMPANY SUMMARY APPO VALLEY FEED is a mid-valley based farm and feed store dedicated to providing our customers with high quality feed products. APPO VALLEY FEED intends to offer only the best feed and products in the industry that are always fresh and available. It also offers its customers the option of a custom made feed. Our primary focus is on keeping our customers satisfied. 2.1 Company Ownership APPO VALLEY FEED will be created as a Limited Liability Corporation. It will be owned by its principal investors , khurshid, Zeeshana, Afshan and Rafie. Zeeshana And Rafie acting as CEO and CFO respectively and each holding 25% stake in the company. Also khurshid as COO and Afshan as CMO are holding 25% share each.There will no silent investors. 2.2 Start-up Plan The total start-up expenses include those of apple pomace, chemicals, jute bags, professionals, insurance, rent, construction, expensed equipment, etc. Start-up assets required include short-term assets (truck, machinery etc.), and initial cash to handle the recognition fee and expenses prior to opening. Long-term asset purchases and the assumption of long-term liabilities are anticipated. 2.3 Company Facilities This company will be located in the heart of the valley. The company has currently good infrastructure with good machinery . The quality supply chain is maintained and the process of production is streamlined with the use of advanced technology and efficient human labor.
3.0 PRODUCT AND SERVICES PRODUCT DESCRIPTION COMPETITIVE COMPARISON SOURCING AND FULFILMENT TECHNOLOGY FUTURE PRODUCTS Most developing countries are facing difficulties in providing sufficient food for their population. The cost of feed is very high and in recent years the price of conventional or basic feeding ingredients has tremendously increased. This has made livestock production very expensive. It is the need of the time to utilize unconventional feeds to make a balanced feed especially for livestock production efficiently. Realising this need we came up with this idea of using apple pomace as a non conventional cost effective animal feed. Unlike other cattle feeds like Hindustan Animal Feeds, PIOUS EXIM ± India, PERFECT Feeds & Chemicals ± India, Surya Feeds & Concentrates ± India, Eshwari Chemtech ± India and locally with Willayat cattle feeds, Royal Cattle Feed ,JK Feeds jammu,Americian feed jammu etc) it is a reliable, eco-friendly and high-quality product. The source of raw material would be different apple juice manufacturing companies which normally throw out pomace
after extracting juice from apples. We are using futuristic technology for the production which is eco- friendly and doesn¶t discharge anything hazardous into the atmosphere. In future we aim to create niche markets i.e., create markets out of existing markets like by making varied varieties of cattle feed, or different varieties for different animals and diversify in the same discipline as much as is profitable for the company. INDUSTRY ANALYSIS:We would go for the industry analysis on the basis of Porters Five Force Model. 1. Threat of substitutes ± as there are already various cattle feeds in the market, the threat of substitutes is large. 2. Bargaining Power Of Suppliers- because our product is entirely new , our bargaining power is going to be high 3. Bargaining power of buyers- as the buyers have no other option to choose from, their bargaining power is going to be less. 4. Inter firm rivalry- being the entrants in an entirely new product, rivalry is also less. We can be the price setters and have a major share of the market. 5. Threat of new entrants- is quite high as the market is varied and the potential customer base is large. INDUSTRY TRENDS:The business that we are entering is in an industry that is growing. But because our product is based on new technology and is cost effective, we would be able to create our own market and even capture a share of the existing market.
MARKETING:Now as per the plan where we are marketing non-conventional cattle feed but if it is not marketed appropriately whole plan will be ineffective. First of all we need to identify if there exists a need for a particular product or not. And in our case we know there is a grave need of an innovative product. After assessing the need we try to identify our market segment which will be based on product specialization (single product for all markets). Since it is starting as a small business we will focus on people who rear cattle in rural areas. People of the kind have little money at disposal so this cost effective feed would be highly beneficial for them. Identification is just not enough what we need to do is that we need to create positive attitude of people towards the product that we are offering. And how can a positive attitude be possibly created. One of the ways is to create a positive brand image not by highlighting ESP (emotional selling point) because people these days are very rationale and logical but by highlighting the USP. The USP in our case would be price. After getting the customer base by using USP we get use tactics to get attached to our customers emotionally which will in turn help us in increasing the brand equity. Here we need to take care of positioning which must be appropriate, say healthy, varied and balanced diet for animals.
Branding
We would brand our product using the brand pyramid model which take care of following aspects a. Mark of specification: distinguish product from our competitors (level like Hindustan Animal Feeds, PIOUS EXIM ± India, PERFECT Feeds & Chemicals ± India, Surya Feeds & Concentrates ± India, Eshwari Chemtech ± India and locally with willayat, royal etc) using low price high quality strategy competitors at national b. Mark of assurance: by giving high quality, consistent and reliable product. c. Moment of choice : making it the only choice available for people in terms of ecofriendliness, cost, usefulness etc d. Mark of association: initiate to make emotional attachment by using different strategies ( emotional appeal) e. Emotional involvement: here people should associate themselves with our product/ brand Keeping in view the PLC we can start niche marketing. Create markets out of existing markets like by making different feed for different animals based on their nutritional requirement. The problem with all these manufacturers is that they make conventional and high cost animal feed. Comparatively we are making non conventional and cost effective feed as mentioned earlier. We believe in value based marketing and the surplus value we will be providing will be the value of convenience and reliability. Pricing would also be thus value based. For our promotions we shall be using different ways of marketing like viral marketing, buzz marketing, ambush marketing, subliminal marketing and green marketing. We can also make use of local media -both online and offline, advertisements, campaigning, small group sessions with the target audience, sponsoring different social and environmental events (ambush marketing).
STRATEGY:Bain & Company¶s View ³Strategy is a company¶s game plan for winning; it maps out the moves a business must make to outwit the competition, captivate customers and increase long-term shareholder value.´ Our strategy would be to go for first intensive growth (improve existing business), then integrative growth (both forward n backward integration) to achieve EOS and finally for diversification as suggested by Ansof¶s matrix (market penetration, product development, market development and finally diversification). With time we will go for niche marketing. For production we will use geocentric approach but for marketing we will go for polycentric approach Pricing would be value- based. MARKETING CHANNELS: A company¶s channel decisions directly affect every other marketing decision. We would be using Wholesalers and Retailers. There are two reasons for that: 1. That sector is mature. 2. These people buy in bulks. Thereby reducing costs in terms of transportation etc. VALUE ADDITION: Based on Michael Porters value chain. Adding value at every possible step on primary actions like Inbound logistic Operation Outbound logistic Marketing/sales Services And secondary actions include supporting activities like infrastructure, HR, technology, procurement. STRATEGY PYRAMID: Strategic objective: To become recognized as a provider of the highest-quality cattle feed. Tactics: use low cost raw material to produce high quality feed which will be highly useful. o Quality assurance with total quality management. o Use developed and cost effective distribution channel Programs: people with right skills will be placed at right place at right time. This will reduce intensiveness of labor and bring in more of quality work in proposed time. Using finance judiciously and arranging skill enhancing programs from time to time for employees. We will be revising and updating our programs, tactics & strategies to be the leaders in the market. PROMOTION STATEGIES:As we are mainly focusing on the rural section of the people who have access to radio and television only, we would be promoting our product via radio, television and newspapers.
SALES STRATEGY:Once we have identified our target market and assessed the benefits our products can potentially bring to our customers, the next step is to plan what method to use in selling our product. The geographical catchment area will help you to determine the best sales methods for your business. These include:
y y y
Personal contact (direct selling, retail) Direct mail (special offers, catalogues) Telesales
The sale is just the beginning. Following up the deal will strengthen the relationship with our new customer, and could provide opportunities for additional sales. STRATEGIC ALLIANCES:We can go for a strategic alliance with the apple juice manufacturing companies in the future to ensure a continuous supply of the apple pomace , so that we can catch up with the demand. The Center for Veterinary Medicine regulates animal feed products. A feed license is required by states for persons manufacturing or distributing commercial feed. Hindustan Animal Feeds - India
OPERATION MANAGEMENT Bioconversion of apple pomace into a nutritionally enriched substrate by Candida utilis This work aims to select biological treatments and conditions for the bioconversion of apple pomace by Candida utilis, into an enriched substrate with increased digestibility for use as ruminant feed. After C. utilis fermentation, the protein level increased 100% and the mineral content 60%, accompanied by 8.2% of increase in the digestibility. The level of free sugars decreased 97% after substrate supplementation with ammonium sulphate (10 g /l). After optimization, sequential fermentation with C. utilis and P. ostreatus achieved a high protein level with 500% of crude protein enrichment after 60 days of fermentation as well as a considerable increase in the mineral level. The level of free sugars increased after the fermentation with P. ostreatus alone due to pectin and hemicellulose degradation. Considering the time required for fermentation, the C. utilis treatment was the most efficient treatment to convert apple pomace into a more nutritive substrate for ruminant feed. Apple pomace is presently used to feed ruminants or simply added to soil as a fertilizer. Several factors adversely affect the value of apple pomace as a ruminant feed. Firstly, the residue has low digestibility due to considered high lignin/cellulose ratio. Secondly, the pomace has a high free sugar content, which after ingestion by ruminants and fermentation in the rumen causes animal alcoholaemia, a problem for cattle farmers. Thirdly, the protein, vitamin and mineral content of apple pomace are low, which contributes to the low nutritional level and consequently low commercial value of the residue.
Fermentation of apple pomace by C. utilis 300 g of wet apple pomace (80% humidity) was mixed with 600 ml of distilled water in 2lErlenmeyer flasks and sterilized at 121 _C for 15 min. The substrate was cooled to room temperature and then inoculated with 100 ml of C. utilis inoculum, previously centrifuged at 850 · g for 10 min and resuspended in 100 ml of sodium chloride solution (8.5 g l)1). Fermentation was performed at 30 _C under constant aeration using small air pumps. After 6 days of fermentation, the pomace was dried at 50 _C for 72 and several chemical parameters were evaluated. The total digestible nutrients, a parameter that evaluates the total nutrients able to be metabolized by animals, also increased after fermentation. These nutrients increased around 16%, changing from 53.4% (w/w) in the non-fermented pomace to 61.8% (w/w) after fermentation (Table 1). In addition, the content of three important mineral elements for ruminant diets, calcium (Ca), phosphorus (P) and potassium (K), also became more concentrated in the substrate after C. utilis treatment. These minerals increased 20, 30 and 23%(w/w), respectively. During the fermentation, the microorganisms oxidized the organic matter present in the substrate, thus increasing the rate of mineral content. The content of total nucleic acids, although presenting an increase of 50% after fermentation, can still be considered a low concentration (0.003% w/w), and not hazardous for animal health. The soluble Klason lignin fraction decreased after C. utilis fermentation.This result was responsible for the increase in the apple pomace digestibility, since this polymer is related to the low digestibility of a lignocelluloses substrate. On the other side, the insoluble fraction of Klason lignin was not degraded during the fermentation. Lignin degradation is extremely dependent on the presence of oxygen and it is therefore possible that the result might have been different if the cultivation was in conditions in which the oxygen availability was higher, e.g. not under submerged conditions. The cellulose fraction of the pomace was slightly degraded (7.8%), and the pectin fraction was consumed 16%. Although several yeast species are able to degrade pectin, cellulolytic ability among yeasts has been observed only in C. utilis. The slight degradation of cellulose also contributes to the increase of apple pomace digestibility. The fermentation of apple pomace by C. utilis was the most efficient biological treatment and it reached our objectives, which were to reduce the free sugars level of the pomace in a short period of time, in addition to nutritional enrichment of the fermented substrate. Nevertheless, even though the fermented pomace digestibility was decreased after the sequential fermentations using C. utilis and P. ostreatus, the fermented substrate presented high potential to be used as protein supplement, if mixed with other more digestible substrates, in cattle feeding. However, factors such as the long time needed to obtain such protein increment and the requirement of large spaces for the processing of high volumes of substrates makes this treatment less feasible than treatment with C. utilis only. In contrast, the fermentation of apple pomace by P. ostreatus alone seems not to be a viable alternative, since the treatment did not decrease the free sugar level of the substrate, and the protein increment was considerably lower than the other treatments and also required a longer period of fermentation. This work only addressed one of the several possible processes to be used to ferment apple pomace .Although the apple pomace is a seasonal agroindustrial residue, the high amount of this residue available annually make it possible that high quantities of supplement for cattle feed could be produced in a short period of time with low cost.
Parameter I Reducing sugars Crude protein Digestibility (DMSIV) Total digestible nutrients Klason lignin Soluble klason lignin Pectin Cellulose Nucleic acid Ash Phosphorus Calcium (Ca) Potassium 15.0 4.1 58.5 53.4 23.5 0.01 5.5 7.2 0.002 2.0 0.07 0.10 . 0.43
Treatments (% (w/dry weight of sample) II 3.0 8.3 63.3 61.8 24.0 0.003 4.6 6.6 0.003 2.6 0.09 0.12 0.53 16.5 5.2 62.6 61.5 27.0 0.006 2.9 8.0 0.003 2.4 0.08 0.12 0.58 III
OVERVIEW OF APPLE POMACE CONVERSION INTO NUTRITIOUS CATTLE FEED . The problem was overcome through fermentation and thus, manufacturing a high protein animal feed. The promising method included fermentation of apple pomace with yeasts, separating out ethanol and using the left-over protein rich material after drying as an animal feed. The major hurdle is to find out the acceptability of feed developed in appropriate animals by actual feeding trials. Recently, feeding of fermented apple pomace to the broilers was found to be successful. Keeping this in view, the present study was undertaken to find out the acceptability of the feed produced by fermentation of apple pomace and to study the effects of its feeding on rats. To utilize apple pomace in an economical and effective way, a feed was developed by solid state fermentation (SSF) using sequential interactive co-culture of Candida utilis and Kloeckera. Removal of ethanol and drying of the left - over residue. Feeding trial was conducted in white albino rats before and after reconstitution of apple pomace feed in the choice and no choice study. Feeding of apple pomace feed in the rats before reconstitution indicated that neither in fermented nor in unfermented form it was acceptable. In the no choice study both in 100% fermented and unfermented apple pomace group feed intake decreased continuously resulting in death of rats apparently due to decreased digestibility owing to high fibre content. Further, fermented or unfermented apple pomace based feed had lower digestibility and efficiency of conversion than the standard rat feed. Compared to the
standard feed group, growth rates in all the feed groups were negative. Incorporation of fermented apple pomace into standard rat feed in the ratio of 1:1 gave better acceptability and digestibility. Reconstituted feed with 10% jaggery, 2% groundnut oil, 0.01% mixed flavour and 1% salt was the most acceptable. The post-mortem examination of the rats that died during the feeding trial revealed generalized oedema, probably due to some hepatotoxin in the feed. The blood glucose level in the apple pomace feed group except that was reconstituted with jaggery, showed a general hypoglycemia, though falling in the range. It also suggested damage to the liver. The mortality rate, post-mortem examination of the rats that died during the feeding trial and blood biochemical analysis of rat serum suggest a more elaborative study for extended period of time. Preparation of animal feed Apple pomace was fermented with sequential cultures .Fermentation was carried out in plastic barrels with Candida utilis for 96 hrs followed by Kloeckera spp. for 120 hrs with intermittent rotation. After completion of fermentation and ethanol recovery, fermented apple pomace was dried in a mechanical dehydrator at 60o 1oC for 8 hrs and was ground and packed in polythene bags. The powdered apple pomace was used for feed acceptability studies. Apple grown areas where there is abundance availability of such feeding material can be used in the diet of lactating animals for the cost effective milk production. Pomace being rich source of energy can replace the starchy ingredients like maize to the extent of 33% in a ration of dairy calves. It contains high level of moisture, which can be evaporated by sun
drying reducing to 10 -15% for its inclusion in the ration. Apple pomace contained 4.72% crude protein (CP), 20.50% crude fibre, 3.22% ether extract, 2.60% ash and 68.96% nitrogen free extract (NFE). The potential digestibility of nitrogen free extract (NDF), acid detergent fiber (ADF) and hemi cellulose were found to be 74.90%, 71.33% and 85.42% respectively. Earlier reports showed that inclusion of apple pomace make the dai ry ration economical and cost effective. The experiment was designed to study the effect of supplementing apple pomace in the dairy ration on milk yield and milk constituents. The information as such is very scanty in such animals and therefore such trial was conducted.
Table 1. Concentrate ingredients and chemical composition of feed (% on DM basis Particulars Group I Group II Oat fodder Feed Ingredients, % Maize 35.0 23.0 Apple pomace 12.0 Peanut cake (deoiled) 31.0 35.0 Wheat bran 31.0 27.0 Mineral mixture 2.00 2.00 Common salt 1.00 1.00 Chemical composition Organic Matter Crude Protein Crude Fibre
88.4 19;0 8.01
88.0 19.2 10.1
22.0 06.8 03.0
DMI and Nutrient intake (With Apple Pomace) ME Days of intake, Lactation Mcal/day 0-30 7.60 31-60 8.20 61-90 8.60 91-120 7.90 121-150 8.30 151-180 7.50 181-210 8.80 211-240 9.10 241-270 9.60 271-300 8.50 Mean 8.41
of cow (Red Sindhi x Jersy) at different stages of lactation: Group ± II Concentrate mixture, kg/day 2.90 4.00 4.60 3.90 3.60 3.20 2.90 2.40 1.60 1.00 3.01 Total DM intake, kg/day 10.50 12.20 13.20 11.80 11.90 10.70 11.70 11.50 12.20 9.50 11.52 CP intake, kg/day 1.05 1.30 1.44 1.26 1.23 1.10 1.13 1.05 0.87 0.74 1.12 TDN intake, kg/day 0.89 8.01 8.67 7.75 7.80 7.04 7.66 7.52 7.31 6.19 6.88
ME intake, M cal/day 24.53 28.27 30.87 27.59 27.77 25.06 27.27 26.77 26.02 22.04 26.22
In spite of a higher level of crude fibre in apple pomace it contributed readily available source of energy due to presence of soluble carbohydrate which increased the productivity of milk almost at par with the control (2274.55 kg Vs 2265.27kg). It was very interesting to note that the constituents of milk were not affected much due to dietary change. The milk yields of crossbred cows (RS x J) have been presented in table 5 and graphically represented in figure 1.
Milk productions in cows in the two groups at different stage of lactation Milk yield, kg Trimester wise milk production, kg Days of Group-I Group-II Group-I Group-II lactation Total Yield Yield/day Total Yield Yield/day Total Yield Yield/day Total Yield 0-30 31-60 61-90 91-120 121-150 151-180 181-210 211-240 241-270 271-300 Total* 224.39 275.00 334.44 313.44 284.00 243.44 231.44 182.56 123.11 62.33 2274.55 7.50 9.17 11.14 10.45 9.47 8.11 7.71 6.10 4.10 2.08 7.58 219.50 300.50 346.12 296.00 271.12 242.13 218.25 184.64 126.13 60.88 2265.22 7.32 10.02 11.59 9.87 9.03 8.07 7.28 6.15 4.26 2.03 7.56 833.83 9.26 866.12
Yield/day 9.62
840.88
9.34
809.25
8.99
537.56
5.97
529.02
5.87
6.0 Web Plan Summary APPO VALLEY FEEDs, website will enable us to offer customers current information on special sales, promos, new product releases, events, and public service announcements. We also plan on utilizing the Web to sell and market our products and services. An e-store will also be implemented into our web design, allowing customers to place orders for the feed they need right on our website. We will be able to accept and process check and credit card orders immediately online. Our customers will still have the options of paying by cash, check or money order as well.
6.1 Website Marketing Strategy Our website will be promoted through the use of sponsor listings and affiliate memberships [confidential and proprietary information removed]. Our site will be registered with all of the major search engines. We will also share links with our distributors and manufacturers. 6.2 Development Requirements Our website will be initially developed with few internal technical resources. IPower Web will host the site and provide the technical back end. MX-Productions will produce the graphics, logos, artwork, and flash media as they will be developing our website from scratch. Our site will be maintained by one of the owners.
7.0 MANAGEMENT SUMMARY:
7.1 ORGAZATIONAL STRUCTURE :
APPO VALLEY FEED depends on an organized division of responsibilities in order to run an efficient, diversified enterprise. Main decisions and responsibilities will be divided between the four top partners. They will focus on maintaining high quality and a cohesive business entity. Top division managers will be given specific responsibilities such as marketing, finance, strategic management, or research and development. 7.2 Management Team APPO VALLEY FEED is completely departmentalized. The main departments are finance, marketing, management, and operations. RAFIE MALIK, owner of the company, assumes the responsibilities of the CFO, while his counterpart, ZEESHANA, will be responsible for the duties of CEO, operations will be done by KHURSHID as COO and AFSHANA will be taking care of Marketing sector as CMO.. The company will make all decisions in accordance with the company mission. Employees are delegated tasks based upon their specialty. Every three months, the four partners will assess the results of these tasks, and the personality of the employee involved, to determine promotion and/or salary issues. 7.3 Personnel Plan Appo valley Feeds,. is currently run and operated by about 50 persons including the top management team of four persons.we have good chunk of labors available in the company to carry out different tasks.. In time, as we implement our marketing plan, we will need to hire in an additional employees to assist the already working employees. We also could possibly need to hire a delivery person in the year 2012. When the business expands with new customers and larger feed orders, Afshan will need to be on site to assist Khurshid with inspecting the orders prior to delivery to ensure quality and accuracy of all orders. As growth evolves other family members may be of age to assist in the processes or employees may need to be placed. 8.0 FINANCIAL PLAN 8.1 Important Assumptions: y Easy entry into the industry. y Demand is there in the market. y 100% recovery from debtors y Raw material available in plenty.. y An adequate loan amount to allow for initial implementation of plans. y Competition and buying patterns remain similar to those used for forecasting. y Existing customer base maintained. y Market research is on target and current (received from different state organizations). y Long-term interest rate will be no more than 7%. y Income tax rate is 30%. y Sales tax rate is 6%.
8.2 Key Financial Indicators. POSITIVE OPERATING CASH FLOW: there is a positive operating cash flow, the PBP of the unit is & months. The costs incurred in the establishment of the unit will be recovered in 7 months. INTEREST COVERAGE RATIO: The company's ability to service its debt is another important criterion to judge its health. The lower the interest coverage ratio, the more difficult it is for the company to service its debt. More debt servicing ratio more is it in the favour of the firm. ICR = PBIT/Fixed interest charges. 6,89,700/12,250 =56.
RETURN ON CAPITAL: EBIT/Capital employed. 6,89,700/8,00,000. = 0.86. Variable and Fixed costs per unit. Raw Materials. Rs 10.00 Transportation. Rs 1.00 Chemicals. Rs 20.00 Packaging. Rs 3.00 Wages/ salaries. Rs 20.00 Electricity. Rs02.00 Diesel. Rs 2.00 Water. Rs 1.00 Marketing. Rs 15.50 Stationary. Rs 0.50 Fixed costs. Rs 1.00 Inventory. Rs 1.01 Misc. Rs 0.10
Total Costs/ unit.
Rs 77.11
8.3 Break even analysis. Break-even is based on fixed costs of approximately Rs 6,00,000. including loan repayment, maintenance and labor. Additionally, controllable such as service labor, advertising and legal/professional fees are included. The volume of sales where revenues are equal to the total costs (fixed+variable). B.E.P or B.E. Sales = fixed costs/contribution per unit. F.C=10,000, variable costs/unit= 77.11, sales/unit=100. BEP= 10,000/22.9= 436.68 units. Profit generated from sales of 436.68 units = 436.68*22.9=9999.97 This will meet our fixed cost requirements only.
8.4 PROJECTED PROFIT AND LOSS To opening stock. To purchase of raw material To carriage inwards. To diesel. To manufacturing wages. To factory rent. To depreciation. Furniture. Machinery. To water and electricity. Total To gross profit c/d Na 9,90,000. 30,000. 60,000. 3,36,000. 15000. 2500. 12500. 90,000. 18,00,000. 14,64,000. By sales. By closing stock. Raw material. Partly manufactured goods. Finished goods. 30,00,000.
-
----------
Total
30,00,000.
To Indirect expenses. To salaries. To storage. To advertisement. To Marketing. To stationary. To Distribution. Total
2,64,000. 30,300. 3,00,000. 1,50,000. 15,000. 15,000. 7,74,300.
To gross profit b/d. By indirect in comes.
14,64,000. - -
Net profit.
6,89,700.
8.5 PROJECTED CASH FLOW Cash flow statement of APPO VALLEY FEED from October-December 2010
Oct.
Cash inflows. Opening balance. . Cash sales. Collection from debtors. Total cash inflows. Cash outflows. Variable expenses. Rent. Creditors. Wages and salaries. 200,000 Total cash outflows. Closing balance. 30100. 5000. 5,40,000. 200,000. ----------. 10,00,000. ---------10,00,000.
Nov.
Dec.
2,24,900. 10,00,000. ------. 12,24,900.
4,49,800 10,00,000. ------14,49,800
30100. 5000. 4,90,000. 200,000.
30100. 5000. 4,90,000. 2,00,000.
7,75,100. 224900.
7,75,100. 4,49,800.
7,75,100. 6,74,700
8.6 PROJECTED BALANCE SHEET
Liabilities. Long term Liabilities. Loans and advances from banks Capital. P&L a/c.
Figures for current year 7 lac. 8 lac. 2,79,215.
Assets. Fixed assets. Land. Building. Plant and machinery. Furniture.
Figures for current year
500,000. 100,000.
Current liabilities. Sundry creditors. Outstanding expenses. interest Provisions. For taxation. Income tax @ 30%. Sales Tax @ 6% For insurance. For Rent of Building and land
........... 12,250.
2,03,235. 1,80,000. ............ 15,000.
Current assets. Cash & bank balances. Stock in trade. Work in progress. Sundry debtors. Advance payments. Bills receivable.
15,89,700. .......... .......... .......... .......... ..........
Total 8.7 Business Ratios.
21,89,700. Total
21,89,700.
The business ratios of the APPO VALLEY FEED for the first three months of business remain constant. As our assumptions suggest that the production, sales, current assets as well as liabilities remain the same. There is no growth in sales because our product is in initial stage and we don¶t want to take risk of holding any kind of inventory, that holds our money. After having a detailed investigation of the market and if there is a potential for increasing the production, APPO VALLEY FEED will expand its business as per customer needs. PBP = 7 months. October 0% 0% 100% 45.98% 3.87% November 0% 0% 100% 45.98% December 0% 0% 100% 45.98%
Sales growth Current liabilities Percent of sales PBIT Current ratio
8.8 Long term Financial Plan. APPO VALLEY FEED, is expected to grow at a steady pace. In conversations with other feed owners, this topic is already a common theme. Many feed stores are beginning to experience record breaking growth rates. This is an exciting time to purchase an already established and successful store in this market. As we expand our customer base, offer more products and bring the dreamed of equine boarding stable to life, we will be positioning APPO VALLEY FEED. amongst the elite dealers in the state of Jammu and Kashmir. We will continuously review our business plan as we implement changes. By doing so we will ensure accuracy and stability. Our goal is to take over this great business, protect it, nurture it, and provide for it. Doing these things will enable us to grow and expand the business in a professional atmosphere.
APPE
1. Masami izumiya (lab. Of regional research management ) 2. Humiko tsushma and Shinnouska TAMA:The research of Apple Friut juice
processing business in Aomori Prefecture Working Paper No.2(1992). 3. Kouji TOYOKAWA and Seiji Murayama:answer book about utilization of apple pomace for livestock feed(cow). Hirosaki University. 4. Masami IZUMIYA:Economic Analysis of biomass industry , lab. Of rural resource distribution, Hirosaki university.
CALCULATIONS: Efficiency of feed utilization The efficiency of different types of feeds given to the rats was analyzed on the basis of consumption index, growth rate, efficiency of conversion of ingested feed and digestibility of feed, as described by Waldbauer (1968).
³FOOD AND SAFETY ,HAND IN HAND´
TEAM MEMBERS: ZEESHANA MUSHTAQ AS CEO AFSHAN GAZI AS CMO KHURSHID MIR AS COO RAFIE MALIK AS CFO DEPARTMENT OF SBS ISLAMIC UNIVERSITY OF SCIENCE AND TECHNOLOGY(IUST) AWANTIPORA PULWAMA KASHMIR
TABLE OF CONTENTS
1. EXECUTIVE SUMMARY««««««««PAGE 2,PAGE 3 2. COMPANY SUMMARY«««««««««PAGE 4
3.
PRODUCTS AND SERVICES««««««PAGE 4,5
4. MARKET ANALYSIS SUMMARY««««PAGE 5,6
5. STRATEGY AND IMPLEMENTATION SUMMARY ««..« PAGE 7, 8.
6. OPERATION MANAGEMENT«««««.PAGE 8 TO 13
7. WEB PLAN SUMMARY«««««.«««PAGE 13.
8. MANAGEMENT SUMMARY««««««PAGE 14.
9. FINANCIAL PLAN««««.««««««PAGE 14 TO 19
10. APPENDICES ««««««««««««PAGE 20
1.0 EXECUTIVE SUMMARY Our project is about the conversion of the waste resources of APPLE POMACE into a safe and nutritional feed in order to counter difficulties being faced in providing sufficient and nutritious food for the live stock population. Since the cost of feed is very high and in recent years the price of conventional or basic feeding ingredients has tremendously increased, this has made live stock production very expensive. It is the need of the time to utilize unconventional feeds like agro industrial by-products to make a balanced feed which in addition will be freeing our environment of the various threats. Our project attempts to set an example for the efficient utilization of the wasted food resource ± APPLE POMACE by producing multienzyme bio-feed, biodegrade the antinutritional factors such as pectin and tannins in apple pomace, and obtain the nutritional enrichment of the fermented substrate. Undumped and untreated deposits of apple pomace has caused serious environmental problems.
Indian apple production averages nearly 2 million tonnes during 2009-10 making it the seventh largest producer of apples in the world. Nearly all of India¶s apples are grown in three mountainous states in north India- Himachal Pradesh, Jammu and Kashmir and Uttarakhand. Himachal Pradesh and Jammu and Kashmir each have roughly equal area planted to apples, but Jammu and Kashmir has the highest average yield and accounts for about two-third of the total production which stands as a base for our business idea and gives us an absolute advantage over other regions. Apple processing industries are one of the major industries of these states like juices, concentrates, wine, cider, canned slices, etc. Food industry In general generates a large quantity of wastes i.e peel, seed , pomace, rags, kernels etc which is biodegradable in nature. Due to richness in carbohydrates, dietary fibres and minerals, such wastes have the potential to support the growth of microorganisms involved in the production of various products. Apple pomace - a by-product of juice processing industry, represents about 25-35% of the weight of the fresh apple processed. is a rich source of many nutrients including carbohydrates, minerals, fibres except protein. Its disposal in the environment, being highly biodegradable (very high BOD), results in production of foul smell and affects the aquatic life since large amounts of the waste are dumped in various water bodies which compels for its proper treatment. Apple pomace has been utilized as an animal feed as such or after ensilage but due to low digestible proteins was not considered suitable as an animal feed. Attempt to increase the quantity of protein was made by addition of non-protein nitrogen to apple pomace but it led to birth of dead or weak calves Utilization of such a waste in an economical and effective way would be in the interest of prevention of resource wastage and better economy of the processing plants and hence provides a great business opportunity.
This project calculates the costs of starting a small venture with a list of all necessary purchases including tangible assets( for example equipment, and inventory) and services, working capital, sources , collateral and market feasibility and relevance of the firm with real market test and thee various strategies both pre and post launch and also various marketing tools to be used. VISION STATEMENT To strive for the development of a sustainable industry that acts responsible within the food chain by ensuring safe and nutritious feed for safe food. MISSION STATEMENT Company aimed at offering high-quality, moderately priced feeds using only natural ingredients. We view ourselves as partners with our customers, our employees, our community and our environment. We aim to become a regionally recognized brand name. We are building a business in which high standards permeate all aspects of our company. Quality is a state of mind at our company. GOALS/OBJECTIVES
y
y y y y y y
Our goal is moderate growth, annual profitability. To expand distribution channels of the company. To create a strong research &development base in unconventional feeds. To complete all planned projects within scheduled time and approved cost. To have loyal customers and provide complete value for money to clients. Use our innovative approach that will help firm to uncover new opportunities. Always take feedback from our customers.
Keys to Success
The keys to success for APPO VALLEY FEED are: 1. Investment capital to provide eco friendly feed favoring environment positively, and deliver a value-added product that produces cost savings for customers that far exceed the product cost. Aggressive marketing to introduce long-term care providers to the significant cost/benefit advantages of APPO VALLEY FEED. Product quality, ease of use, world-class customer service and support. Price competitiveness.
2.
3. 4.
2.0 COMPANY SUMMARY APPO VALLEY FEED is a mid-valley based farm and feed store dedicated to providing our customers with high quality feed products. APPO VALLEY FEED intends to offer only the best feed and products in the industry that are always fresh and available. It also offers its customers the option of a custom made feed. Our primary focus is on keeping our customers satisfied. 2.1 Company Ownership APPO VALLEY FEED will be created as a Limited Liability Corporation. It will be owned by its principal investors , khurshid, Zeeshana, Afshan and Rafie. Zeeshana And Rafie acting as CEO and CFO respectively and each holding 25% stake in the company. Also khurshid as COO and Afshan as CMO are holding 25% share each.There will no silent investors. 2.2 Start-up Plan The total start-up expenses include those of apple pomace, chemicals, jute bags, professionals, insurance, rent, construction, expensed equipment, etc. Start-up assets required include short-term assets (truck, machinery etc.), and initial cash to handle the recognition fee and expenses prior to opening. Long-term asset purchases and the assumption of long-term liabilities are anticipated. 2.3 Company Facilities This company will be located in the heart of the valley. The company has currently good infrastructure with good machinery . The quality supply chain is maintained and the process of production is streamlined with the use of advanced technology and efficient human labor.
3.0 PRODUCT AND SERVICES PRODUCT DESCRIPTION COMPETITIVE COMPARISON SOURCING AND FULFILMENT TECHNOLOGY FUTURE PRODUCTS Most developing countries are facing difficulties in providing sufficient food for their population. The cost of feed is very high and in recent years the price of conventional or basic feeding ingredients has tremendously increased. This has made livestock production very expensive. It is the need of the time to utilize unconventional feeds to make a balanced feed especially for livestock production efficiently. Realising this need we came up with this idea of using apple pomace as a non conventional cost effective animal feed. Unlike other cattle feeds like Hindustan Animal Feeds, PIOUS EXIM ± India, PERFECT Feeds & Chemicals ± India, Surya Feeds & Concentrates ± India, Eshwari Chemtech ± India and locally with Willayat cattle feeds, Royal Cattle Feed ,JK Feeds jammu,Americian feed jammu etc) it is a reliable, eco-friendly and high-quality product. The source of raw material would be different apple juice manufacturing companies which normally throw out pomace
after extracting juice from apples. We are using futuristic technology for the production which is eco- friendly and doesn¶t discharge anything hazardous into the atmosphere. In future we aim to create niche markets i.e., create markets out of existing markets like by making varied varieties of cattle feed, or different varieties for different animals and diversify in the same discipline as much as is profitable for the company. INDUSTRY ANALYSIS:We would go for the industry analysis on the basis of Porters Five Force Model. 1. Threat of substitutes ± as there are already various cattle feeds in the market, the threat of substitutes is large. 2. Bargaining Power Of Suppliers- because our product is entirely new , our bargaining power is going to be high 3. Bargaining power of buyers- as the buyers have no other option to choose from, their bargaining power is going to be less. 4. Inter firm rivalry- being the entrants in an entirely new product, rivalry is also less. We can be the price setters and have a major share of the market. 5. Threat of new entrants- is quite high as the market is varied and the potential customer base is large. INDUSTRY TRENDS:The business that we are entering is in an industry that is growing. But because our product is based on new technology and is cost effective, we would be able to create our own market and even capture a share of the existing market.
MARKETING:Now as per the plan where we are marketing non-conventional cattle feed but if it is not marketed appropriately whole plan will be ineffective. First of all we need to identify if there exists a need for a particular product or not. And in our case we know there is a grave need of an innovative product. After assessing the need we try to identify our market segment which will be based on product specialization (single product for all markets). Since it is starting as a small business we will focus on people who rear cattle in rural areas. People of the kind have little money at disposal so this cost effective feed would be highly beneficial for them. Identification is just not enough what we need to do is that we need to create positive attitude of people towards the product that we are offering. And how can a positive attitude be possibly created. One of the ways is to create a positive brand image not by highlighting ESP (emotional selling point) because people these days are very rationale and logical but by highlighting the USP. The USP in our case would be price. After getting the customer base by using USP we get use tactics to get attached to our customers emotionally which will in turn help us in increasing the brand equity. Here we need to take care of positioning which must be appropriate, say healthy, varied and balanced diet for animals.
Branding
We would brand our product using the brand pyramid model which take care of following aspects a. Mark of specification: distinguish product from our competitors (level like Hindustan Animal Feeds, PIOUS EXIM ± India, PERFECT Feeds & Chemicals ± India, Surya Feeds & Concentrates ± India, Eshwari Chemtech ± India and locally with willayat, royal etc) using low price high quality strategy competitors at national b. Mark of assurance: by giving high quality, consistent and reliable product. c. Moment of choice : making it the only choice available for people in terms of ecofriendliness, cost, usefulness etc d. Mark of association: initiate to make emotional attachment by using different strategies ( emotional appeal) e. Emotional involvement: here people should associate themselves with our product/ brand Keeping in view the PLC we can start niche marketing. Create markets out of existing markets like by making different feed for different animals based on their nutritional requirement. The problem with all these manufacturers is that they make conventional and high cost animal feed. Comparatively we are making non conventional and cost effective feed as mentioned earlier. We believe in value based marketing and the surplus value we will be providing will be the value of convenience and reliability. Pricing would also be thus value based. For our promotions we shall be using different ways of marketing like viral marketing, buzz marketing, ambush marketing, subliminal marketing and green marketing. We can also make use of local media -both online and offline, advertisements, campaigning, small group sessions with the target audience, sponsoring different social and environmental events (ambush marketing).
STRATEGY:Bain & Company¶s View ³Strategy is a company¶s game plan for winning; it maps out the moves a business must make to outwit the competition, captivate customers and increase long-term shareholder value.´ Our strategy would be to go for first intensive growth (improve existing business), then integrative growth (both forward n backward integration) to achieve EOS and finally for diversification as suggested by Ansof¶s matrix (market penetration, product development, market development and finally diversification). With time we will go for niche marketing. For production we will use geocentric approach but for marketing we will go for polycentric approach Pricing would be value- based. MARKETING CHANNELS: A company¶s channel decisions directly affect every other marketing decision. We would be using Wholesalers and Retailers. There are two reasons for that: 1. That sector is mature. 2. These people buy in bulks. Thereby reducing costs in terms of transportation etc. VALUE ADDITION: Based on Michael Porters value chain. Adding value at every possible step on primary actions like Inbound logistic Operation Outbound logistic Marketing/sales Services And secondary actions include supporting activities like infrastructure, HR, technology, procurement. STRATEGY PYRAMID: Strategic objective: To become recognized as a provider of the highest-quality cattle feed. Tactics: use low cost raw material to produce high quality feed which will be highly useful. o Quality assurance with total quality management. o Use developed and cost effective distribution channel Programs: people with right skills will be placed at right place at right time. This will reduce intensiveness of labor and bring in more of quality work in proposed time. Using finance judiciously and arranging skill enhancing programs from time to time for employees. We will be revising and updating our programs, tactics & strategies to be the leaders in the market. PROMOTION STATEGIES:As we are mainly focusing on the rural section of the people who have access to radio and television only, we would be promoting our product via radio, television and newspapers.
SALES STRATEGY:Once we have identified our target market and assessed the benefits our products can potentially bring to our customers, the next step is to plan what method to use in selling our product. The geographical catchment area will help you to determine the best sales methods for your business. These include:
y y y
Personal contact (direct selling, retail) Direct mail (special offers, catalogues) Telesales
The sale is just the beginning. Following up the deal will strengthen the relationship with our new customer, and could provide opportunities for additional sales. STRATEGIC ALLIANCES:We can go for a strategic alliance with the apple juice manufacturing companies in the future to ensure a continuous supply of the apple pomace , so that we can catch up with the demand. The Center for Veterinary Medicine regulates animal feed products. A feed license is required by states for persons manufacturing or distributing commercial feed. Hindustan Animal Feeds - India
OPERATION MANAGEMENT Bioconversion of apple pomace into a nutritionally enriched substrate by Candida utilis This work aims to select biological treatments and conditions for the bioconversion of apple pomace by Candida utilis, into an enriched substrate with increased digestibility for use as ruminant feed. After C. utilis fermentation, the protein level increased 100% and the mineral content 60%, accompanied by 8.2% of increase in the digestibility. The level of free sugars decreased 97% after substrate supplementation with ammonium sulphate (10 g /l). After optimization, sequential fermentation with C. utilis and P. ostreatus achieved a high protein level with 500% of crude protein enrichment after 60 days of fermentation as well as a considerable increase in the mineral level. The level of free sugars increased after the fermentation with P. ostreatus alone due to pectin and hemicellulose degradation. Considering the time required for fermentation, the C. utilis treatment was the most efficient treatment to convert apple pomace into a more nutritive substrate for ruminant feed. Apple pomace is presently used to feed ruminants or simply added to soil as a fertilizer. Several factors adversely affect the value of apple pomace as a ruminant feed. Firstly, the residue has low digestibility due to considered high lignin/cellulose ratio. Secondly, the pomace has a high free sugar content, which after ingestion by ruminants and fermentation in the rumen causes animal alcoholaemia, a problem for cattle farmers. Thirdly, the protein, vitamin and mineral content of apple pomace are low, which contributes to the low nutritional level and consequently low commercial value of the residue.
Fermentation of apple pomace by C. utilis 300 g of wet apple pomace (80% humidity) was mixed with 600 ml of distilled water in 2lErlenmeyer flasks and sterilized at 121 _C for 15 min. The substrate was cooled to room temperature and then inoculated with 100 ml of C. utilis inoculum, previously centrifuged at 850 · g for 10 min and resuspended in 100 ml of sodium chloride solution (8.5 g l)1). Fermentation was performed at 30 _C under constant aeration using small air pumps. After 6 days of fermentation, the pomace was dried at 50 _C for 72 and several chemical parameters were evaluated. The total digestible nutrients, a parameter that evaluates the total nutrients able to be metabolized by animals, also increased after fermentation. These nutrients increased around 16%, changing from 53.4% (w/w) in the non-fermented pomace to 61.8% (w/w) after fermentation (Table 1). In addition, the content of three important mineral elements for ruminant diets, calcium (Ca), phosphorus (P) and potassium (K), also became more concentrated in the substrate after C. utilis treatment. These minerals increased 20, 30 and 23%(w/w), respectively. During the fermentation, the microorganisms oxidized the organic matter present in the substrate, thus increasing the rate of mineral content. The content of total nucleic acids, although presenting an increase of 50% after fermentation, can still be considered a low concentration (0.003% w/w), and not hazardous for animal health. The soluble Klason lignin fraction decreased after C. utilis fermentation.This result was responsible for the increase in the apple pomace digestibility, since this polymer is related to the low digestibility of a lignocelluloses substrate. On the other side, the insoluble fraction of Klason lignin was not degraded during the fermentation. Lignin degradation is extremely dependent on the presence of oxygen and it is therefore possible that the result might have been different if the cultivation was in conditions in which the oxygen availability was higher, e.g. not under submerged conditions. The cellulose fraction of the pomace was slightly degraded (7.8%), and the pectin fraction was consumed 16%. Although several yeast species are able to degrade pectin, cellulolytic ability among yeasts has been observed only in C. utilis. The slight degradation of cellulose also contributes to the increase of apple pomace digestibility. The fermentation of apple pomace by C. utilis was the most efficient biological treatment and it reached our objectives, which were to reduce the free sugars level of the pomace in a short period of time, in addition to nutritional enrichment of the fermented substrate. Nevertheless, even though the fermented pomace digestibility was decreased after the sequential fermentations using C. utilis and P. ostreatus, the fermented substrate presented high potential to be used as protein supplement, if mixed with other more digestible substrates, in cattle feeding. However, factors such as the long time needed to obtain such protein increment and the requirement of large spaces for the processing of high volumes of substrates makes this treatment less feasible than treatment with C. utilis only. In contrast, the fermentation of apple pomace by P. ostreatus alone seems not to be a viable alternative, since the treatment did not decrease the free sugar level of the substrate, and the protein increment was considerably lower than the other treatments and also required a longer period of fermentation. This work only addressed one of the several possible processes to be used to ferment apple pomace .Although the apple pomace is a seasonal agroindustrial residue, the high amount of this residue available annually make it possible that high quantities of supplement for cattle feed could be produced in a short period of time with low cost.
Parameter I Reducing sugars Crude protein Digestibility (DMSIV) Total digestible nutrients Klason lignin Soluble klason lignin Pectin Cellulose Nucleic acid Ash Phosphorus Calcium (Ca) Potassium 15.0 4.1 58.5 53.4 23.5 0.01 5.5 7.2 0.002 2.0 0.07 0.10 . 0.43
Treatments (% (w/dry weight of sample) II 3.0 8.3 63.3 61.8 24.0 0.003 4.6 6.6 0.003 2.6 0.09 0.12 0.53 16.5 5.2 62.6 61.5 27.0 0.006 2.9 8.0 0.003 2.4 0.08 0.12 0.58 III
OVERVIEW OF APPLE POMACE CONVERSION INTO NUTRITIOUS CATTLE FEED . The problem was overcome through fermentation and thus, manufacturing a high protein animal feed. The promising method included fermentation of apple pomace with yeasts, separating out ethanol and using the left-over protein rich material after drying as an animal feed. The major hurdle is to find out the acceptability of feed developed in appropriate animals by actual feeding trials. Recently, feeding of fermented apple pomace to the broilers was found to be successful. Keeping this in view, the present study was undertaken to find out the acceptability of the feed produced by fermentation of apple pomace and to study the effects of its feeding on rats. To utilize apple pomace in an economical and effective way, a feed was developed by solid state fermentation (SSF) using sequential interactive co-culture of Candida utilis and Kloeckera. Removal of ethanol and drying of the left - over residue. Feeding trial was conducted in white albino rats before and after reconstitution of apple pomace feed in the choice and no choice study. Feeding of apple pomace feed in the rats before reconstitution indicated that neither in fermented nor in unfermented form it was acceptable. In the no choice study both in 100% fermented and unfermented apple pomace group feed intake decreased continuously resulting in death of rats apparently due to decreased digestibility owing to high fibre content. Further, fermented or unfermented apple pomace based feed had lower digestibility and efficiency of conversion than the standard rat feed. Compared to the
standard feed group, growth rates in all the feed groups were negative. Incorporation of fermented apple pomace into standard rat feed in the ratio of 1:1 gave better acceptability and digestibility. Reconstituted feed with 10% jaggery, 2% groundnut oil, 0.01% mixed flavour and 1% salt was the most acceptable. The post-mortem examination of the rats that died during the feeding trial revealed generalized oedema, probably due to some hepatotoxin in the feed. The blood glucose level in the apple pomace feed group except that was reconstituted with jaggery, showed a general hypoglycemia, though falling in the range. It also suggested damage to the liver. The mortality rate, post-mortem examination of the rats that died during the feeding trial and blood biochemical analysis of rat serum suggest a more elaborative study for extended period of time. Preparation of animal feed Apple pomace was fermented with sequential cultures .Fermentation was carried out in plastic barrels with Candida utilis for 96 hrs followed by Kloeckera spp. for 120 hrs with intermittent rotation. After completion of fermentation and ethanol recovery, fermented apple pomace was dried in a mechanical dehydrator at 60o 1oC for 8 hrs and was ground and packed in polythene bags. The powdered apple pomace was used for feed acceptability studies. Apple grown areas where there is abundance availability of such feeding material can be used in the diet of lactating animals for the cost effective milk production. Pomace being rich source of energy can replace the starchy ingredients like maize to the extent of 33% in a ration of dairy calves. It contains high level of moisture, which can be evaporated by sun
drying reducing to 10 -15% for its inclusion in the ration. Apple pomace contained 4.72% crude protein (CP), 20.50% crude fibre, 3.22% ether extract, 2.60% ash and 68.96% nitrogen free extract (NFE). The potential digestibility of nitrogen free extract (NDF), acid detergent fiber (ADF) and hemi cellulose were found to be 74.90%, 71.33% and 85.42% respectively. Earlier reports showed that inclusion of apple pomace make the dai ry ration economical and cost effective. The experiment was designed to study the effect of supplementing apple pomace in the dairy ration on milk yield and milk constituents. The information as such is very scanty in such animals and therefore such trial was conducted.
Table 1. Concentrate ingredients and chemical composition of feed (% on DM basis Particulars Group I Group II Oat fodder Feed Ingredients, % Maize 35.0 23.0 Apple pomace 12.0 Peanut cake (deoiled) 31.0 35.0 Wheat bran 31.0 27.0 Mineral mixture 2.00 2.00 Common salt 1.00 1.00 Chemical composition Organic Matter Crude Protein Crude Fibre
88.4 19;0 8.01
88.0 19.2 10.1
22.0 06.8 03.0
DMI and Nutrient intake (With Apple Pomace) ME Days of intake, Lactation Mcal/day 0-30 7.60 31-60 8.20 61-90 8.60 91-120 7.90 121-150 8.30 151-180 7.50 181-210 8.80 211-240 9.10 241-270 9.60 271-300 8.50 Mean 8.41
of cow (Red Sindhi x Jersy) at different stages of lactation: Group ± II Concentrate mixture, kg/day 2.90 4.00 4.60 3.90 3.60 3.20 2.90 2.40 1.60 1.00 3.01 Total DM intake, kg/day 10.50 12.20 13.20 11.80 11.90 10.70 11.70 11.50 12.20 9.50 11.52 CP intake, kg/day 1.05 1.30 1.44 1.26 1.23 1.10 1.13 1.05 0.87 0.74 1.12 TDN intake, kg/day 0.89 8.01 8.67 7.75 7.80 7.04 7.66 7.52 7.31 6.19 6.88
ME intake, M cal/day 24.53 28.27 30.87 27.59 27.77 25.06 27.27 26.77 26.02 22.04 26.22
In spite of a higher level of crude fibre in apple pomace it contributed readily available source of energy due to presence of soluble carbohydrate which increased the productivity of milk almost at par with the control (2274.55 kg Vs 2265.27kg). It was very interesting to note that the constituents of milk were not affected much due to dietary change. The milk yields of crossbred cows (RS x J) have been presented in table 5 and graphically represented in figure 1.
Milk productions in cows in the two groups at different stage of lactation Milk yield, kg Trimester wise milk production, kg Days of Group-I Group-II Group-I Group-II lactation Total Yield Yield/day Total Yield Yield/day Total Yield Yield/day Total Yield 0-30 31-60 61-90 91-120 121-150 151-180 181-210 211-240 241-270 271-300 Total* 224.39 275.00 334.44 313.44 284.00 243.44 231.44 182.56 123.11 62.33 2274.55 7.50 9.17 11.14 10.45 9.47 8.11 7.71 6.10 4.10 2.08 7.58 219.50 300.50 346.12 296.00 271.12 242.13 218.25 184.64 126.13 60.88 2265.22 7.32 10.02 11.59 9.87 9.03 8.07 7.28 6.15 4.26 2.03 7.56 833.83 9.26 866.12
Yield/day 9.62
840.88
9.34
809.25
8.99
537.56
5.97
529.02
5.87
6.0 Web Plan Summary APPO VALLEY FEEDs, website will enable us to offer customers current information on special sales, promos, new product releases, events, and public service announcements. We also plan on utilizing the Web to sell and market our products and services. An e-store will also be implemented into our web design, allowing customers to place orders for the feed they need right on our website. We will be able to accept and process check and credit card orders immediately online. Our customers will still have the options of paying by cash, check or money order as well.
6.1 Website Marketing Strategy Our website will be promoted through the use of sponsor listings and affiliate memberships [confidential and proprietary information removed]. Our site will be registered with all of the major search engines. We will also share links with our distributors and manufacturers. 6.2 Development Requirements Our website will be initially developed with few internal technical resources. IPower Web will host the site and provide the technical back end. MX-Productions will produce the graphics, logos, artwork, and flash media as they will be developing our website from scratch. Our site will be maintained by one of the owners.
7.0 MANAGEMENT SUMMARY:
7.1 ORGAZATIONAL STRUCTURE :
APPO VALLEY FEED depends on an organized division of responsibilities in order to run an efficient, diversified enterprise. Main decisions and responsibilities will be divided between the four top partners. They will focus on maintaining high quality and a cohesive business entity. Top division managers will be given specific responsibilities such as marketing, finance, strategic management, or research and development. 7.2 Management Team APPO VALLEY FEED is completely departmentalized. The main departments are finance, marketing, management, and operations. RAFIE MALIK, owner of the company, assumes the responsibilities of the CFO, while his counterpart, ZEESHANA, will be responsible for the duties of CEO, operations will be done by KHURSHID as COO and AFSHANA will be taking care of Marketing sector as CMO.. The company will make all decisions in accordance with the company mission. Employees are delegated tasks based upon their specialty. Every three months, the four partners will assess the results of these tasks, and the personality of the employee involved, to determine promotion and/or salary issues. 7.3 Personnel Plan Appo valley Feeds,. is currently run and operated by about 50 persons including the top management team of four persons.we have good chunk of labors available in the company to carry out different tasks.. In time, as we implement our marketing plan, we will need to hire in an additional employees to assist the already working employees. We also could possibly need to hire a delivery person in the year 2012. When the business expands with new customers and larger feed orders, Afshan will need to be on site to assist Khurshid with inspecting the orders prior to delivery to ensure quality and accuracy of all orders. As growth evolves other family members may be of age to assist in the processes or employees may need to be placed. 8.0 FINANCIAL PLAN 8.1 Important Assumptions: y Easy entry into the industry. y Demand is there in the market. y 100% recovery from debtors y Raw material available in plenty.. y An adequate loan amount to allow for initial implementation of plans. y Competition and buying patterns remain similar to those used for forecasting. y Existing customer base maintained. y Market research is on target and current (received from different state organizations). y Long-term interest rate will be no more than 7%. y Income tax rate is 30%. y Sales tax rate is 6%.
8.2 Key Financial Indicators. POSITIVE OPERATING CASH FLOW: there is a positive operating cash flow, the PBP of the unit is & months. The costs incurred in the establishment of the unit will be recovered in 7 months. INTEREST COVERAGE RATIO: The company's ability to service its debt is another important criterion to judge its health. The lower the interest coverage ratio, the more difficult it is for the company to service its debt. More debt servicing ratio more is it in the favour of the firm. ICR = PBIT/Fixed interest charges. 6,89,700/12,250 =56.
RETURN ON CAPITAL: EBIT/Capital employed. 6,89,700/8,00,000. = 0.86. Variable and Fixed costs per unit. Raw Materials. Rs 10.00 Transportation. Rs 1.00 Chemicals. Rs 20.00 Packaging. Rs 3.00 Wages/ salaries. Rs 20.00 Electricity. Rs02.00 Diesel. Rs 2.00 Water. Rs 1.00 Marketing. Rs 15.50 Stationary. Rs 0.50 Fixed costs. Rs 1.00 Inventory. Rs 1.01 Misc. Rs 0.10
Total Costs/ unit.
Rs 77.11
8.3 Break even analysis. Break-even is based on fixed costs of approximately Rs 6,00,000. including loan repayment, maintenance and labor. Additionally, controllable such as service labor, advertising and legal/professional fees are included. The volume of sales where revenues are equal to the total costs (fixed+variable). B.E.P or B.E. Sales = fixed costs/contribution per unit. F.C=10,000, variable costs/unit= 77.11, sales/unit=100. BEP= 10,000/22.9= 436.68 units. Profit generated from sales of 436.68 units = 436.68*22.9=9999.97 This will meet our fixed cost requirements only.
8.4 PROJECTED PROFIT AND LOSS To opening stock. To purchase of raw material To carriage inwards. To diesel. To manufacturing wages. To factory rent. To depreciation. Furniture. Machinery. To water and electricity. Total To gross profit c/d Na 9,90,000. 30,000. 60,000. 3,36,000. 15000. 2500. 12500. 90,000. 18,00,000. 14,64,000. By sales. By closing stock. Raw material. Partly manufactured goods. Finished goods. 30,00,000.
-
----------
Total
30,00,000.
To Indirect expenses. To salaries. To storage. To advertisement. To Marketing. To stationary. To Distribution. Total
2,64,000. 30,300. 3,00,000. 1,50,000. 15,000. 15,000. 7,74,300.
To gross profit b/d. By indirect in comes.
14,64,000. - -
Net profit.
6,89,700.
8.5 PROJECTED CASH FLOW Cash flow statement of APPO VALLEY FEED from October-December 2010
Oct.
Cash inflows. Opening balance. . Cash sales. Collection from debtors. Total cash inflows. Cash outflows. Variable expenses. Rent. Creditors. Wages and salaries. 200,000 Total cash outflows. Closing balance. 30100. 5000. 5,40,000. 200,000. ----------. 10,00,000. ---------10,00,000.
Nov.
Dec.
2,24,900. 10,00,000. ------. 12,24,900.
4,49,800 10,00,000. ------14,49,800
30100. 5000. 4,90,000. 200,000.
30100. 5000. 4,90,000. 2,00,000.
7,75,100. 224900.
7,75,100. 4,49,800.
7,75,100. 6,74,700
8.6 PROJECTED BALANCE SHEET
Liabilities. Long term Liabilities. Loans and advances from banks Capital. P&L a/c.
Figures for current year 7 lac. 8 lac. 2,79,215.
Assets. Fixed assets. Land. Building. Plant and machinery. Furniture.
Figures for current year
500,000. 100,000.
Current liabilities. Sundry creditors. Outstanding expenses. interest Provisions. For taxation. Income tax @ 30%. Sales Tax @ 6% For insurance. For Rent of Building and land
........... 12,250.
2,03,235. 1,80,000. ............ 15,000.
Current assets. Cash & bank balances. Stock in trade. Work in progress. Sundry debtors. Advance payments. Bills receivable.
15,89,700. .......... .......... .......... .......... ..........
Total 8.7 Business Ratios.
21,89,700. Total
21,89,700.
The business ratios of the APPO VALLEY FEED for the first three months of business remain constant. As our assumptions suggest that the production, sales, current assets as well as liabilities remain the same. There is no growth in sales because our product is in initial stage and we don¶t want to take risk of holding any kind of inventory, that holds our money. After having a detailed investigation of the market and if there is a potential for increasing the production, APPO VALLEY FEED will expand its business as per customer needs. PBP = 7 months. October 0% 0% 100% 45.98% 3.87% November 0% 0% 100% 45.98% December 0% 0% 100% 45.98%
Sales growth Current liabilities Percent of sales PBIT Current ratio
8.8 Long term Financial Plan. APPO VALLEY FEED, is expected to grow at a steady pace. In conversations with other feed owners, this topic is already a common theme. Many feed stores are beginning to experience record breaking growth rates. This is an exciting time to purchase an already established and successful store in this market. As we expand our customer base, offer more products and bring the dreamed of equine boarding stable to life, we will be positioning APPO VALLEY FEED. amongst the elite dealers in the state of Jammu and Kashmir. We will continuously review our business plan as we implement changes. By doing so we will ensure accuracy and stability. Our goal is to take over this great business, protect it, nurture it, and provide for it. Doing these things will enable us to grow and expand the business in a professional atmosphere.
APPE
1. Masami izumiya (lab. Of regional research management ) 2. Humiko tsushma and Shinnouska TAMA:The research of Apple Friut juice
processing business in Aomori Prefecture Working Paper No.2(1992). 3. Kouji TOYOKAWA and Seiji Murayama:answer book about utilization of apple pomace for livestock feed(cow). Hirosaki University. 4. Masami IZUMIYA:Economic Analysis of biomass industry , lab. Of rural resource distribution, Hirosaki university.
CALCULATIONS: Efficiency of feed utilization The efficiency of different types of feeds given to the rats was analyzed on the basis of consumption index, growth rate, efficiency of conversion of ingested feed and digestibility of feed, as described by Waldbauer (1968).
