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Reclaiming Arid Land In Kenya - Jowell Enterprises

Farming of Holticulture Produce

We plant the following crops to sell to exporters; French Beans, Garden peas ,Runner beans and baby corns.We farm in Arid area and use water to irrigate. We also plant trees to serve as weed breaker assisting in afforestation. Its labour intensive hence more jobs are created to locals.

Facts

Year of establishment

2006

Sales (US$)
Two years ago:
Last year:
This year (forecast): 97,500
Year 2 (forecast): 200,000
Year 3 (forecast): 500,000
Net profit after tax (US$)
Two years ago:
Last year:
This year (forecast): 60,000
Year 2 (forecast): 120,000
Year 3 (forecast): 270,000
Total number of Employees
Two years ago:
Last year:
This year (forecast): 20
Year 2 (forecast): 50
Year 3 (forecast): 70

Finance needed

Finance needed for fixed assets (buying of machines, buildings, ...) 30,300
Finance needed for working capital (salaries, stock, rental, leasing, transport, ...) 6,000
Total finance needed (US$) 36,300

How do you expect this to be financed?

Own Contribution in cash 20,000
Loans (debt) 50,000
Shares in your company that you offer to investors (equity)
Other sources 15,500
Total finance needed (US$) 85,500

The Business

What is your product/service?

Our main crops that we grow include french beans, Cascadia, garden peas, runner beans and baby corns. However, in seasons when the export market is not favourable, we plant tomatoes and cabbages for local market.
In kenya, there are a number of large horticulture companies growing for export. They are howver not growing sufficient to meet their orders from the foreign and local markets. They therefore sub contract other farmers who must go through Rigorous tests and conditions to qualify to produce for them. Ones you have passed this test, you then sign an annual contract with them to supply the crop throughout the year. There is also a high local demand from the supermarkets. At Jowell Enterprises, we are currently supplying to exporters only. In a season of 90 days, one acre yields about 5 tonnes while the exporters prices vary between 0.8 USD to 2.5 USD.

Horticutural crops are very sensitive to weather and even the environment. One is therefore reqiured to prepare the land well and apply chemicals to kill all the insects and fungi. The planting is also labour intensive with each acre requiring 5 labourers per month. Only general. The labourers just need to know how to read so that they can follow instructions especially when using chemicals. After planting, you need to keep irrigating the crop quite often. Regular spraying of chemicals is also important to ensure good health of the crop. The harvesting will normally start from the 45 th day from the date of germinating and will continue for another 45 days from the date of the first harvest.
Because of the pumping of water from the borehole and the river, a powerful pressure pump is required.

Our suppliers are the exporters( Currently on contract with Everest Enterprises Ltd) who supply seeds and information on plant care. The others are the Local Agri- chemical shops supplying fertilisers and chemicals, local community for the supply of labour, Local transports some of whom use donkeys to transport the raw materials to the farm. We also have the Ministry of Water that permits us to use the water from the river.

Explain how you will sell your product/service (marketing strategy) and how you will reach your customers (distribution strategy)?

The growing of horticultural crops in Kenya is labour and capital intensive. The demand for the farmers who can grow the same is very high. The buyers/ exporters normally set out some conditions that must be met to qualify to be their farmer. After all is set, they supply the seeds and provide Field Officers to assist in guiding during the planting. All the planting dates are thereafter diarised and the Field Officers keep paying visits to the farm to see the progress of grow. On harvest day, they normally come to collect the produce from the farm.

To ensure that our products are not rejected by the customer, we also follow their conditions and also have created a good rapport with the labourers to ensure that they are satisfied with our conditions of work thereby resulting in quality produce.

Ones a contract has been signed and all the conditions set by the exporters are met, then they will always come to collect the produce even if it is during the time when their market is flooded.

By growing our crop in an arid land, the warm weather favours the maturity of the crop giving them the reqiured colour and shape.

What makes your business different/better than your competitors (competitive advantage)?

Our product is unique in the sense that we don't relay on the rain seasons to plant but we are able to plant throughout the year. Again, its for export meaning that we assist our country in earning foreign currency.

The Entrepreneur & Management

Describe the entrepreneur & management

We started the holticulture farming with my wife in October 2006 and leased 10 acres of land. In six months, we had already started making some returns with each acre giving about USD 2,000.00. We have also been coexisting well with the local community who have been also supplying labour to us.Furthermore, we have signed a contract with Everest Enterprises Ltd, one of the leading exporters of fresh produce in Kenya who are also very suportive in terms of giving seeds on credit and the support of their field officers.

This experience has given us immense strength to continue with the business.
The business is so far doing very well and we have learnt that by involving the local community treating them well, they also reciprocate and add value to our business.

Development

How does your business improve the local living standards (social and environmental)?

As mentioned, horticulture farming is labour intensive. We therefore offer direct employment to the locals. Again the produce is then transported by the Truck drivers who also earn their living. Our produce ones purchased by the exporter, he also employs staff in the offices to coordinate between the market and the source( farm). The overall effect is that most of the locals are able to afford food and take their children to school.

Our hope is that in the next two years, most of our labourers will have learnt alot by gaining skills that they can employ to start their own small skill farming and improve on their living standards.

2 comments

RECLAIMING ARID LAND IN KENYA

More than half of Kenya's Land is either Semi Arid or Arid land. The area is however very productive when there are sufficient rains.

Mr & Mrs Joseph Wambugu, 4 June 07, 16:40

INTERNATIONAL MARKET FOR CAPSICUM CAYNE & LEEKS

Conglatulations to all those who made it in this competition. I must also admit that i have learnt alot from the judges feedback.

I am still carrying on with my horticultural farming and have now diversified by planting some more products. These are;
(i) Capsicum Cayne
(ii) Leeks
These products will be ready by early February 2008.
Is there an international market for these products?

Regards,

Joseph Wambugu

Mr & Mrs JOSEPH WAMBUGU, 22 Nov 07, 12:30
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