Drought Resilience and Sustainable Livelihood Program

Supported Cooperative Association

Barako alle Livestock Fattening & Marketing

Cooperative
(Ltd Liability)

Business plan (final draft)

March, 2017 Jigjiga, Ethiopia

Table of Contents:
1. Introduction .............................................................................................................................................. 2
2. Profile of the cooperative association. ..................................................................................................... 2
3. Mission of the Cooperative ....................................................................................................................... 3
4. Vision of the Cooperative ......................................................................................................................... 3
5. Objectives................................................................................................................................................. 3
6. Implementation plan to start the Business Activities ............................................................................... 3
7. Material and inputs requirement Plan...................................................................................................... 4
8. Production and Marketing plan ................................................................. Error! Bookmark not defined.
9. Planned financial flow ............................................................................................................................... 6
10. Risk analysis ............................................................................................................................................ 7
10.1. Possible Risks ................................................................................................................................... 7
10.2. Mitigation mechanism ..................................................................................................................... 8
11. Major Socio Economic Benefits .............................................................................................................. 8
12. Business plan approval: ........................................................................................................................ 10

=1=
1. Introduction
The potential in terms of cattle and shoats is quite significant in the areas and can be serve as a
base for fattening and marketing business. These business ventures found viable with different
profitability and required investment. Livestock marketing/trading found the most profitable
since pastoralists and agro-pastoralists depend on livestock production for income source,
consumption and indication of wealth status. As it is projected in the livestock master plan of
the country, livestock production would grow from 1.275 to 1.933 million tons between 2015
and 2020. This would not, however, meet expected consumption growth of 58% by 2020 (to
2.008 million tons), leaving a 7% deficit (187,000 tones) in the 2015–2020 red meat production
and consumption balance. Therefore, undertaking of the business will have good market
opportunity to expand and improve the supply helps to generate income and improve
livelihood. Thus, livestock fattening and marketing cooperative will implement shoats fattening
in goljano district of Somali Region with the total initial investment cost of 180,000 birr and this
total amount of investment will be given from drought Resilience and sustainable livelihood
project. Therefore, this cooperative particularly works on shoats fattening and marketing and it
will enhance livelihood resilience of the member group of this cooperative association who are
vulnerable due to recurrent drought risks. Besides, it will also have key role in introducing
modern livestock production system and transferring knowledge and skill to the other pastoral
groups in the project target areas.
2. Profile of the cooperative association.
 Region: Ethiopian Somali Zone: fafan Woreda: goljano Kebele: sanxaskule
 Name of the cooperative: barako alle livestock Marketing Cooperative Ltd Liability.
 Type of Business: Livestock fattening and Marketing.
 No of Member: Male: 5 Female: 10 Total: 15
 Contact Address: Mobile No:_______________

=2=
3. Mission of the Cooperative
Build capability to manage risks resulted from recurrent drought and other natural hazards
through working on and diversifying livelihood strategies of member group.
4. Vision of the Cooperative
To see the target group are sustainably drought resilient and capable enough to economically
self supportive.
5. Objectives
 To manage risks resulted from recurrent drought;
 To enhance economically self-reliant cooperative;
 To promote collectively solve economic and food security problems;
 To minimize/reduce the individual impact of risks and uncertainties;
 To develop the social and economic culture through sharing knowledge and working on
livelihood activities.
6. Implementation plan to start the Business Activities
The major activities that will be done to implementing the activities shall includes finalizing
precertification activities, and post certification activities like training provision, procurement of
basic material inputs and building barn, as it is specified in this business plan document.
Accordingly, the following table summarizes activities and time frame in which it will be
accomplished by respective responsible institutions.
Table 1: Schedule for beginning of Implementing of the Activities (March –July, 2017)
S/ Description of the activities March April May June July Implementing
N organization
1 Finalizing documentation process RCPA & RPDRSLP
2 Certification RCPA
3 Procurement of material Inputs RPDRSLP, RCPA, woreda
and equipments procurement committee
4 Provision of Training
 skill training RLPDB,RCPA
 Administrative training.
5 Construction of Shed WPCU,
Cooperative society
=3=
 6 Start the business WoPCUs, RPCUs and
others
7. Material and inputs requirement Plan
The cooperative start the business with 95 heads of goats fattening and the main objective of
the business undertaking is to fatten this life animal in four production cycles per a year with
three months feeding interval and generate profit capable to improve livelihood of each
member of the cooperative association. Accordingly, required inputs and its corresponding
current market price were used to compute the aggregate investment cost of the business and
thus the total initial operational cost of the business is estimated to be 180,000 birr.
Cost Breakdown for the inputs required;
Cost of live Animals and feeding Requirements
S/ Input required Unit Qt. Unit Total When Planned Technical advice
N price investment required source of required for each
(month/ input/techno input/technology
season) logy
1 Shoats(20-25kg) No 95 900 85,500.00
2 Concentrated Kg 4275 10 42,750.00
Feed
3 Minerals(salt) Kg 63.34 6 380.04
4 Oilcake(fagulo) Kg 713.1 7 4991.84
2
Sub total 133,621.88
Note: The standard concentration feeding required for one shoat per a day ranges from 450-600g.
Accordingly, 0.5 kg was recommended for one shoat and the concentration feed required for 95 shoats
in one production cycle is 0.5*95* 90=4275kg and current market price of 1kg is 10 birr at the local
market.

Cost of Medication, feed and water trough

S/ Input required Unit Qt. Unit Total When Planned Technical advice
N price investment required source of required for each
(month/ input input
season)
1 Medication Pack 4 100 400.00
Multivitamin Bottle100ml 2 50 100.00
Wound spray No 4 200 800.00
=4=
 (Ecto parasite)
Veterinary drug Bottle 3 50 150.00
(Antibiotic oxy 100ml
20%)
2 Feed trough
Lumber(30cm) No 9 400 3,600.00
Nail(5cm) Kg 1 60 60
Labor cost Birr 1 500 500.00
3 water trough
Metal Barrel No 4 700 2800.00
Labor cost Birr 1 500 500.00
Paint (Antirust) Gallon 1 300 300.00
Watering can Number 12 90 1,080.00
Subtotal 10,290.00

Construction of barn
S/ Input required Unit Qt. Unit Total Planned source Technical advice
N price investment of required for each
input/technology input/technology
1 Barn (7M*12 M )
Sheet metal No 60 140 8400.00
Nail(5,7,8 & 9cm) Kg 10 60 600.00
Door(lamera) No 2 500 1000.00
Pool No 40 120 4800.00
Purling No 15 100 1500.00
Truss No 20 70 1400.00
Small size truss No 100 25 2500.00
Wire mesh Roll 1 550 550.00
Wire mesh Meter 40 70 2800.00
Floor(sand/red soil) M2 8 315 2520.00
Labor cost No 60 150 9000.00
Cement Quint 5 200 1000.00
al
Sub Total 36070.00

8. Production and Marketing plan

Cycle Description Unit Qt Unit Total sales Market place
=5=
 price Within Outside Within Other
kebele kebele woreda markets
1 Selling of fattening No 95 1744 165,680.00
animal
2 Selling of fattening No 95 1766 167,770.00
animal
3 Selling of fattening No 95 1766 167,770.00
animal
4 Selling of fattening No 95 1766 167,770.00
animal
Note: After three months 1% initial direct investment cost increase will be expected to gain calculate the actual
95 shoats total sell in each production cycle (three months).

9. Planned financial flow

Expected revenue by Quarter

S/N Revenue Quarter

1st quarter 2nd quarter 3rd quarter 4thquarter

1 Selling fattening 165,680.00 167,770.00 167,770.00 167,770.00

shoats

Expected expenditures by Quarter

S/N Expenditure items
1st quarter 2nd quarter 3rd quarter 4thquarter

1 Cost of live animal and 133,621.88 133,621.88 133,621.88 133,621.88

feeding requirements
2 Medication, feed and 10,290.00 2200.00 2200.00 2200.00
water trough
3 Construction of small 36,070.00 - - -
shed
Total 179,981.88 135,821.88 135,821.88 135,821.88

Financial feasibility statement

=6=
Quarter (a) Income (b) Expenditure(c) Profit/loss d=(b-c)
Fattening phase 1st 165,680.00 179981.88,000.00 -14,301.88
Fattening phase 2nd 167,770.00 135,821.88 31,948.12
Fattening phase 3rd 167,770.00 135,821.88 31,948.12
Fattening phase 4th 167,770.00 135,821.88 31,948.12
81,542.48
10. Risk analysis

10.1. Possible Risks

The livestock fattening and marketing cooperative business might be encountered unforeseen
risks during its operational time. The business is vulnerable to risks of different type because of
the nature of production and this may differently impacts production and productivity of the
business. In other words though investing in small ruminant production is one of the most
profitable agribusiness in the pastoral area there are various kinds of associated risks impacts
production and productivity of the business. Particularly, the main risks associated with small
ruminants fattening and marketing include:
 Weak monitoring and evaluation system,
 Feeble livestock extension service,
 Diseases,
 Change of weather condition,
 Waste management system.
Specifically, in its nature risks emanate from disease hazards are contagious and it will not only
resulting substantial physical loss of animals but also a simultaneous cause loss of demand for
the product and thereby negativity affecting tastes and preference of the consumers.
Therefore, proper mitigation strategy shall be used to timely manage the risks and ensure
sustainable livelihood resilience of the target beneficiaries.

=7=
10.2. Mitigation mechanism
The following possible mitigation measures will be used to copy up different types of risks
might be arising and negatively impact implementation of the business.
 In order to avert diseases related risks preventive measures should be in place through
proper management such as supplying proper feed and clean water and supplying
veterinary services such as vaccination, medicaments and lock monitoring.
 Enhance intersectoral linkage to provide technical advice and related services for the
target beneficiaries;
 The marketing linkage shall be created for the selling of fattening live animals in each
production cycle;
 In order to avoid feed shortages, the cooperative should have reasonable reserve feed
stock.
11. Major Socio Economic Benefits
 Increased meat Production
Increased production will contribute to local meat supplies and reduce regional and national food
shortage.
 Income and Employment
The implementation of the fattening activities will create employment opportunities for 15 individual’s
member of the cooperative association in the goljano woreda. Therefore, improved fattening
production business will increase individual/household income through cash income available
for food or other purchases.
 Food Security
Increased cash income resulting from increased fattening production will result in higher family
consumption of a greater variety of foods. This in turn will result improved diets and nutrition levels.

 Technology Transfer
Improved technology and fattening practices will be available to users as a result of the
support and extension services.
=8=
Woreda Goljano
Kabele Sanxasgule
cooperative Barako-alla
name
Cooperative Livestock fattening and marketing
type
S/n Name Age Sex Price per Reg.fee
share
1 Nimco abdi hoosh 60 F 15 150
2 Istaahil khaliil sh. tahir 38 F 15 150
3 Mahamed ali faroole 22 M 15 150
4 Nuura ahmed haashi 28 F 15 150
5 Hinda osman abdi 20 F 15 150
6 Ugaso jama shiil 29 F 15 150
7 Ardo muhumed hayd 40 F 15 150
8 Haybis abdi ahmed 28 F 15 150
9 Hasan mahamed yahye 30 M 15 150
10 Haashi abdi farah 33 M 15 150
11 Nuuriya mahamed Hussein 28 F 15 150
12 Khadra mukhtar aadan 24 F 15 150
13 Asad yuusuf qalinle 35 M 15 150
14 Foosiya abdi osman 32 F 15 150
15 Mahamed mahamoud 60 M 15 150
a/laaahi

San xasgule

Cooperative name: barako-allah

Administration committee

s/n Name Position

1 Nimco abdi hoosh chair person

2 Istaahil khaliil sh. Tahir deputy
3 Mahamed ali faroole seceratory
4 Nuura ahmed haashi accountant
5 Hinda osman abdi cashier

=9=
Kabale : San xasgule

Cooperative name: barako-allah

Monitoring committee

s/n Name Position

1 Ugaso jama shiil chair person

2 Ardo muhumed hayd Member
3 Haybis abdi ahmed Member

Kabale : San xasgule

Cooperative name: barako-allah

Procurement committee

s/n Name Position

1 Hasan mahamed yahye chair person

2 haashi abdi faarah Member
3 Nuuriya muhumed hasan Member

12. Business plan approval:

Prepared By: Approved By:
1._______________________________________ 1._____________________________________
2. ________________________________________ 2._____________________________________
3. _______________________________________ 3. ___________________________________

=10=