seeds ltd
DESCRIPTION
Seeds Ltd. Business Plan For A New and Improved Seed Cleaning Plant Nav Khinda, Sean McAlpine and Noor Syed. April 05, 2007. Contents of the Plan. Introduction Background Current Situation Goals Key Questions Operational Plan Marketing Plan Financial Plan. Introduction. - PowerPoint PPT PresentationTRANSCRIPT
![Page 1: Seeds Ltd](https://reader035.vdocuments.site/reader035/viewer/2022081420/56815d8a550346895dcb9574/html5/thumbnails/1.jpg)
Seeds Ltd.Business Plan For A
New and Improved Seed Cleaning Plant
Nav Khinda, Sean McAlpine and Noor Syed
April 05, 2007
![Page 2: Seeds Ltd](https://reader035.vdocuments.site/reader035/viewer/2022081420/56815d8a550346895dcb9574/html5/thumbnails/2.jpg)
Introduction Background Current Situation Goals Key Questions Operational Plan Marketing Plan Financial Plan
Contents of the Plan
![Page 3: Seeds Ltd](https://reader035.vdocuments.site/reader035/viewer/2022081420/56815d8a550346895dcb9574/html5/thumbnails/3.jpg)
Introduction Seeds is an on-farm cleaning and packaging
plant in Sask.
size and color comparison of beans
•Cereals, pulses and oil seeds are cleaned and quality tested to broker’s specification
•Four machines clean and sort the seeds according to color, size, shape and density.
•Six employees
![Page 4: Seeds Ltd](https://reader035.vdocuments.site/reader035/viewer/2022081420/56815d8a550346895dcb9574/html5/thumbnails/4.jpg)
Color, Weight and Size Variations in Seeds
Assorted beanswheat grainfenugreek
black mustardhemp
green lentils dried peasgreen split peassoya beans wheat germ
oats Golden flax
Pinto beanscoriander
Variety of pulses
![Page 5: Seeds Ltd](https://reader035.vdocuments.site/reader035/viewer/2022081420/56815d8a550346895dcb9574/html5/thumbnails/5.jpg)
Background began seed cleaning operation in 1985
Seeds Ltd. became incorporated in 1997
Authorized for pedigree and certified for organic seed cleaning
![Page 6: Seeds Ltd](https://reader035.vdocuments.site/reader035/viewer/2022081420/56815d8a550346895dcb9574/html5/thumbnails/6.jpg)
Current Situation
Flax Unable to meet 99.99% purity
Chickpeas, Lentils, Peas and Beans
Not able to process fragile crops
Mustard Unable to meet 99.9% purity
Coriander Unable to remove splits and wheat
Wheat is an allergen
Small Lentils Not able to remove cereals
Gluten is allergen, 100% wheat free
Seed variety Unmet Requirements Comments
![Page 7: Seeds Ltd](https://reader035.vdocuments.site/reader035/viewer/2022081420/56815d8a550346895dcb9574/html5/thumbnails/7.jpg)
Current Situation Seeds Ltd. Business Plan
New equipment will further improve capability to clean seeds to customer specifications
Increase the plant capacity
![Page 8: Seeds Ltd](https://reader035.vdocuments.site/reader035/viewer/2022081420/56815d8a550346895dcb9574/html5/thumbnails/8.jpg)
Goals of New Plant
Reach sales of $1 M Continue superior quality service
![Page 9: Seeds Ltd](https://reader035.vdocuments.site/reader035/viewer/2022081420/56815d8a550346895dcb9574/html5/thumbnails/9.jpg)
ORGANIZATIONAL CHART
President
Administrative Asst. Plant AssistantsPlant Operator
Warehouse Technologist
3rd technologist
Warehouse Technologist
![Page 10: Seeds Ltd](https://reader035.vdocuments.site/reader035/viewer/2022081420/56815d8a550346895dcb9574/html5/thumbnails/10.jpg)
Plan View of Operations
Warehouse
Shipping Processing
Future Development
Area
Screenings
Raw Material Storage Screenings
Burning AreaReceiving
Long Term Storage
Bulk Shipping
![Page 11: Seeds Ltd](https://reader035.vdocuments.site/reader035/viewer/2022081420/56815d8a550346895dcb9574/html5/thumbnails/11.jpg)
WORK FLOW PLAN
CLEANING
PACKAGING
RECEIVING
1.
3.
2.
![Page 12: Seeds Ltd](https://reader035.vdocuments.site/reader035/viewer/2022081420/56815d8a550346895dcb9574/html5/thumbnails/12.jpg)
Packaging
![Page 13: Seeds Ltd](https://reader035.vdocuments.site/reader035/viewer/2022081420/56815d8a550346895dcb9574/html5/thumbnails/13.jpg)
HACCP and ISO
Canadian Food Inspection Agency
•Seeds Ltd. meets HACCP inspection regulations•Currently no certification for seed cleaning plants exists•Voluntary compliance and free inspection is available•New plant is designed with improvements in critical control points•According to customers specifications lab tests are outsourced
![Page 14: Seeds Ltd](https://reader035.vdocuments.site/reader035/viewer/2022081420/56815d8a550346895dcb9574/html5/thumbnails/14.jpg)
Marketing Questions
•Who are the current competitors?
•Unique services?
•Supply a niche market successfully?
•Buying and selling direct
•Will HACCP be a factor in the future?
•Should a quality control lab be part of the QC system? In-house?
•Organic industry expanding?
![Page 15: Seeds Ltd](https://reader035.vdocuments.site/reader035/viewer/2022081420/56815d8a550346895dcb9574/html5/thumbnails/15.jpg)
The Four P’s1. Products and Services
- cleaning, storage and packaging of various seeds- high quality of service
2. Pricing- cost plus; time required for processing- below or in par with others
3. Promotion - develop relations with existing and new brokers
![Page 16: Seeds Ltd](https://reader035.vdocuments.site/reader035/viewer/2022081420/56815d8a550346895dcb9574/html5/thumbnails/16.jpg)
STP Segmentation
Geographical location Broker specifications
Targeting Continue to focus on organic market
Positioning Consistent high quality std. Approachable, professional and dependable
![Page 17: Seeds Ltd](https://reader035.vdocuments.site/reader035/viewer/2022081420/56815d8a550346895dcb9574/html5/thumbnails/17.jpg)
SWOT Analysis•Strengths
•knowledge & experience•solid reputation•economy of scope
•Weaknesses•location (rail)•company size
•Opportunities•emerging trend of higher quality standards•growth in organic industry
•Threats•power of buyers•environment•large competitors•demand
![Page 18: Seeds Ltd](https://reader035.vdocuments.site/reader035/viewer/2022081420/56815d8a550346895dcb9574/html5/thumbnails/18.jpg)
Marketing Strategies Sales and Profit Objectives
$1 million in sales Channels of Distribution
Customers arrange for delivery and pickup Pricing Policy
Cost plus We recommend a market value approach
Select Markets/Products/Service Mix Organic, Export, High purity demands
Selling and Advertising Minimal effort $10,000 per year in trade shows
![Page 19: Seeds Ltd](https://reader035.vdocuments.site/reader035/viewer/2022081420/56815d8a550346895dcb9574/html5/thumbnails/19.jpg)
Debt and Equity
Breakdown of funding for BirdSeeds Ltd.
Finance Source Cdn $Owner Equity $ 598,300Venture Capital $ 1,015,872 Long Term Debt $ 356,928 Total Financing $ 1,971,100
![Page 20: Seeds Ltd](https://reader035.vdocuments.site/reader035/viewer/2022081420/56815d8a550346895dcb9574/html5/thumbnails/20.jpg)
Financial Analysis and Overall Financial Performance
Summary of the Financial Situation (Base case scenario)
Year 2008 2009 2013 2017
Sales $1,030,857 $1,149,312 $1,253,838 $1,367,870 COGS $809,634 $913,426 $727,290 $709,740 Gross Profit $221,223 $235,885 $526,548 $658,131 Expenses $72,685 $72,554 $71,326 $68,607 Net Income Before
Taxes $148,538 $163,331 $455,221 $589,524 Income Tax $14,854 $16,333 $59,327 $106,333 Net Income $133,684 $146,998 $395,894 $483,190 Net Cash Flow to
Equity $369,912 $483,930 $497,037 $504,836 Net Present Value
(NPV) $287,909
IRR 25.11%
![Page 21: Seeds Ltd](https://reader035.vdocuments.site/reader035/viewer/2022081420/56815d8a550346895dcb9574/html5/thumbnails/21.jpg)
Risk Analysis
VariableLevel of Importance (1, 2, 3)
Capacity 1Cleaning Price 1Grade Changes 2Number of Employees
2
Wage rates 2Seed Price 2Interest rate 2Inflation rate 2Tax rate 3
Key for the table.
1. Critical for success and feasibility
2. Important for financial performance
3. Minor importance, but has damaging effect on financial
performance.
![Page 22: Seeds Ltd](https://reader035.vdocuments.site/reader035/viewer/2022081420/56815d8a550346895dcb9574/html5/thumbnails/22.jpg)
Scenario Analyses
VariableBase Case
Worst Case Best Case
Capacity % 100% 80% 100%
Capacity 27.8 24.2 27.8Grade
Changes 1 3 0Packaging
Price $ 38.86 $ 36.91 $ 40.80
NPV $ 287,909 $(1,027,617) $ 855,391IRR 25% -6% 35%
![Page 23: Seeds Ltd](https://reader035.vdocuments.site/reader035/viewer/2022081420/56815d8a550346895dcb9574/html5/thumbnails/23.jpg)
Break even Analysis
0
5000
10000
15000
20000
25000
Year
Ann
ual T
onna
ge/t
IRRCash FlowNet Income
![Page 24: Seeds Ltd](https://reader035.vdocuments.site/reader035/viewer/2022081420/56815d8a550346895dcb9574/html5/thumbnails/24.jpg)
Break even Analysis
$-
$5.00
$10.00
$15.00
$20.00
$25.00
Year
Ave
rage
Cle
anin
g Pr
ice/
$/t IRR
Cash FlowNet Income
![Page 25: Seeds Ltd](https://reader035.vdocuments.site/reader035/viewer/2022081420/56815d8a550346895dcb9574/html5/thumbnails/25.jpg)
Summary
Volume is key Marketing will play an important role Viable Business Plan
![Page 26: Seeds Ltd](https://reader035.vdocuments.site/reader035/viewer/2022081420/56815d8a550346895dcb9574/html5/thumbnails/26.jpg)
Interactive Session
![Page 27: Seeds Ltd](https://reader035.vdocuments.site/reader035/viewer/2022081420/56815d8a550346895dcb9574/html5/thumbnails/27.jpg)
Thank You