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Business start-up

TITLE: JATROPHA GREEN FARMING PROJECT

BUSINESS PLAN: BUSINESS DRIVEN CONSERVATION INITIATIVE; Applicant: ARID GREEN FOUNDATION Location: KAJIADO SOUTH, RIFT VALLEY

II. PROJECT BACKGROUND
• To develop arid land available to the foundation in Kijiado South in the Rift Valley off Nairobi/Namanga Rd
• To sink water wells/boreholes both for the farm and social intervention by watering animals for local masaai pastoralist community
• To plant 10 acres of jatropha trees for environmental value
• To tend and harvest jatropha trees for its economic value
• To extract biodiesel for sale

Facts

Legal status business
Formally registered
Year of establishment

2010

Sales (US$)
Two years ago:
Last year:
This year (forecast): 84,440
Year 2 (forecast): 168,880
Year 3 (forecast): 253,320
Net profit after tax (US$)
Two years ago:
Last year:
This year (forecast): 17,732
Year 2 (forecast): 102,172
Year 3 (forecast): 186,612
Total number of Employees
Two years ago:
Last year:
This year (forecast): 130
Year 2 (forecast): 150
Year 3 (forecast): 200

Finance needed

Finance needed for fixed assets (buying of machines, buildings, ...) 69,712
Finance needed for working capital (salaries, stock, rental, leasing, transport, ...) 66,708
Total finance needed (US$) 136,420

How do you expect this to be financed? Please note: the total amount mentioned here should be equal to the total finance needed at the previous question.

Own Contribution in cash 13,640
Loans (debt) 116,000
Share capital that you seek from investors (equity) 0
Other sources 6,780
Total finance needed (US$) 136,420

The Business

What is your product/service?

To establish “Jatropha Green Farming Project” to produce biodiesel and byproducts such as fuel, soap, etc and sale to create earnings from local consumption and foreign incomes through exports. Also to tend the crop for environmental rehabilitation of this semi arid area in the Rift Valley Region of Kenya and to contribute to reduction of green house gas emissions, provide cheap, accessible fuel for domestic use and enhance food production.

What customer need/problem do your products/services satisfy?

- Expensive imported biodiesel products
- Scarce/unpredictable biodiesel products supply
- Unemployment opportunities
- Water scarcity
- Food Insecurity
- Harsh Semi arid environment

How will you make the product/service?

- Farm Preparation/Plantation Establishment/Management
Fencing, borehole, Water pump, Lay water polullycin pipes for drip irrigation, Dig earth dump
- Planting:Site Inspection/Assessment/Soil sampling/initial Soil testing and audit, Seed selection, tilling, Seed Nursery, seed transfer/planting, Pruning
- Harvesting:Storage, Extraction, Packaging
- Refining:Assessment of bio fuel; separation and standardization Kenya Bureau of Standards, etc

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

Local Consumption and for Export:

Sales: Dispatch salesmen/women targeting local consumers of kerosene and other products with local products emanating from jatropha

Marketing: Aiming at the domestic market by attacking the monopolies with superior products from jatropha, cheaper, accessible and of better quality through mass media and advertisement channels

Supplies: Establish distributor links countrywide , closer to the consumers

To whom are you selling, what is your market?

- Local consumers, local community members and institutions directly
retail shops
wholesales
schools
hospitals
hotels
generator users
tractor farming individuals/companies
- Export firms for international consumptions
- Motorists and bio-diesel machine operators
- Foreign expatriates who already know the value
- Aviation industry, aerospace consumers; Costa Rica, EU, Canada
- Transport industry seeking to cut cost on diesel prices

Describe your competitors?

Competitors of Jatropha products are multi-national bio-diesel producers, their products are already very expensive and scarce.

Whereas most byproducts of jatropha are of multi-use i.e. medicinal value, soap products for washing and bathing, mosquito repentant, fertilizer, for lighting and cooking fuel, the competing products are of single use and expensive, prices determined by international markets, hence unattractive to local consumers

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

Kenya is on the way to benefiting by contributing into the industry, thus Arid Green Foundation intends to achieve its twin objectives – green environmental and economic incomes through jatropha farming.

What makes your business, your product or service innovative?

The Aviation industry accounts for over 16 Billion gallons of Jet fuel per year, and upwards of 5% of the Green House gases. The large-scale growing of jatropha is a critical event for aviation/aerospace industry, biodiesel production for local consumption just as organizations such as the Jatropha Harvest Experience in Costa Rica has done, our business focuses on production/capacity issues to meet aviation/aerospace industry need in next 10years

How will you ensure the growth of your business?

Jatropha Green Farming is a durable long term investment. The Jatropha plant has a known economic lifespan of over 40 years without replanting. There are many examples of trees over 60 years producing more than 120kg of seed, per year.
It begins to yield after 6 – 8 months; 1st year seed yield/Ha 6,000kg, 2nd year seed yield/Ha 12,000Kg, 3rd year seed yield/Ha 18,000Kg, 4th year seed yield/Ha 20,000Kg, 5th+ year seed yield/Ha 24,000Kg

The Entrepreneur & Management

Describe the entrepreneur & management

Institutional/Accounting Capacity:
1. Foundation’s owned land – 10 acre farm in Semi-arid area of Kajiado South
2. High skilled Board and staff of Arid Green Foundation (graduates)
3. Internal Monitoring and Evaluation mechanism
4. In-build accounting systems
5. Proficient accounting staff - qualified
6. Internal finance/auditing processes (checks and balances)
7. Bank statements
8. Independent external auditors

What specifically makes you and (if relevant) your management team most qualified to build this business?

This conservation driven business opportunity is God given, Arid Green Foundation has own 10 acre land and have embraced the idea by mobilizing community in and around Kajiado South area towards an enabling project which is geared at wealth creation and environmental activities. And most of our board members are raised in the arid/semi arid harsh environment hence we already had aspirations same as this business plan to engage in similar venture

How much time do/will you expect to spend per week in the business?

Staff - 100%
Management Board - 50%
Local Community - 5%
Experts - 5%
GoK/Partner Bodies - 5%
Institutions of Higher learning - 5%

Development

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

Potential Impact:
Rehabilite semi-arid environment of Kajiado South and its environs, Growth of Agro-forestry business in the country, Provide water sources, Trained youth for Trainer of Trainers project countrywide to share best practices on poverty alleviation, Sustainable peace due to availability of green pasture and water for Masaai herds of cattle, Food security, Employment, Reversal of rural-urban migrations