Introduction
The Generaalsdraai farm is located at Wonderfontein in Mpumalanga. While the location and the climate are excellent in terms of harvesting, the farm has not been active as a business for the last couple of years. However, it has great potential that can be successfully utilized. At the moment, all the equipment is outdated, and no efforts were put into creating a flourishing environment effective for farming. The idea is to create an integrative system for fish farming (tilapia) and crop harvesting (garlic). These two interconnected activities will cooperate within one integrated farm since the tilapia waste will be used as compost for the garlic crops.
The objective is to put a system in place based on selling fish at the farmer’s market and producing supplements and seasoning using the harvested garlic crops. The business aims to produce quality crops, grow healthy fish, and process the crops for organic seasoning, holistic practices, and vitamin supplements. Our vision is to grow food security in our nation, which is why the small, non-commercial farm will produce healthy, organic, and beneficial products. Such objectives are at the core of the farm’s desirable outcomes, and with the proper equipment, planning, workforce, and marketing strategies, they can be fulfilled.
Production
Generaalsdraai will be an integrated farm, which means that more than one product will be produced. In this case, garlic and tilapia are two different agricultural materials obtain during the farming process. The garlic will be used to produce seasonings and health supplements, and the tilapia will be sold at farmers’ markets, and the waste will be used as organic compost for the herb crops and cover crops. The cover crops planted to prevent soil erosion are mint, eucalyptus, oregano, and parsley. The farm territory will be divided between the crop and the fish farming. The plan is to use between 3 hectares for the garlic. The rest will be designated for several ponds and tanks.
Forecast of Demand
Garlic supplements can be sold all year round since they can lower blood pressure, help with inflammation, and support the immune system. However, the demand will rise during the seasons when the general population experiences flu outbreaks and other immunity issues that lead to an increase in purchases of such products. Flu seasons usually occur during fall and winter, and these periods will be the most effective in terms of revenue. Garlic seasoning is another product that will be available all year round, with an emphasis on production before major holidays due to a predicted increase in customer demand. Tilapia will be sold at the farmers’ market any time of the year since the demand is always high due to the relatively low price and the nutritional benefits.
Options for Production
There are two different production sources, which is why it is essential to examine them separately. For the production of garlic supplements and seasoning, the process will start with purchasing the necessary seeds (Figure 1). Buying fertilizer is redundant since tilapia production will contribute to it. For 1 hectare of land, there is a need for 400kg of seeds. In this case, for 3 hectares, 1200 kg a needed. Plowing equipment is also needed, as well as additional workers. The plan is to hire three full-time laborers. Sowing will also require special equipment which will be bought. The following production process is yielding before processing the garlic through specialized equipment to crush it into multiple particles for the following packaging and selling.
The production schedule is presented in Table 1. Production takes approximately nine months, according to plan. Moreover, the soil quality will be tested for fertility before planting and once every month to ensure fertility. It is vital to keep a beneficial environment for the crops to grow strong and resistant to changes in weather or infestations of pests. The plan is to maintain the quality by using compost from tilapia farming. Moreover, additional cover crops like mint, eucalyptus, oregano, and parsley will be planted to cover the soil and prevent soil erosion.
The tilapia farming will begin with the setting of the system (tanks, water filtration, etc.). 600 fingerlings will be purchased and placed in the controlled environment (20/20 m pond). The water temperature, food, and supplements will be strictly regulated according to the general tilapia farming standards. The temperature will constantly be set between 28-30 degrees Celsius. The water pH will be monitored and kept between the pH of 6 to 9. The food given to the fish will contain such minerals as copper, zinc, iron, and magnesium for optimal health and growth. Certain fishes will be separated for breeding, while the other ones will be harvested eight months after purchase (Table 1). After this time period, the fish will be ready to be sold at the farmers’ market (Figure 2).
Moreover, the waste from tilapia will be used to fertilize the soil. After reseeding, the new fingerlings will be divided. A part of the new fish crop will be sold to other farmers while the rest will remain at Generaalsdraai for the next eight months. The breeding cycle will continue, and there will be no need to purchase fish after the first eight months. Furthermore, the fingerlings sold before they can be harvested will increase the revenue and be beneficial for the control of the number of fish in the tanks.
Equipment
The necessary equipment for the garlic crops includes a planter, a harvester, and an irrigator. Moreover, a storage building is required for the crops to be placed between harvesting and processing. For the tilapia farm, there is a need for building ponds. Moreover, we will be purchasing a filtration system and tanks. It is essential to mention that three separate ponds and multiple tanks are needed due to the plan to separate breeding adults, fingerlings, and adult fishes ready for consumers to buy. There is no need for transportation purchase since the plan involves hiring a contractor with existing transportation equipment. Another important purchase that will increase revenue is a large processor that will turn the garlic into the powder that will be used for the final steps before packaging. While there is no necessary equipment in the current assets, the plan is to invest in all the required technical machinery since these investments will be covered by the subsequent revenue from selling the products. To avoid certain risk factors, the supplier will be chosen based on the reviews from other similar farmers.
Risks
Farming correlates with certain risks that need to be addressed and minimized early on. According to researchers, the agricultural business is one of the riskiest due to its reliability on natural conditions, the market, and specific national regulations (Riepina et al., 2020). The first risk is having unfavorable climate condition during the time period when the garlic crops will be most vulnerable. However, garlic is relatively safe to plant due to its high resistance. If planted at least six weeks prior to the first autumns freeze, the crops will survive. Moreover, the climate in the area is favorable for effective harvesting.
The SWOT analysis (Figure 3) illustrates further weaknesses, strengths, opportunities, and threats. In terms of tilapia farming, there is a risk of certain diseases caused by inadequate water quality. This, however, will be abolished with an efficient filtration system and frequent tests of the water pH. Certain shipping risks will be minimized by hiring a skilled transportation contractor with personal equipment.
Organic Farming Challenges/Solutions
Since we strive to produce organic products to attract a particular demographic, there are three main risks that occur. They are the soil quality, weed, and pests. In terms of soil, no pesticides or chemical fertilizers will be used. Instead, as mentioned before, the waste obtained from farming tilapia will be used as natural composting material. Moreover, cover crops will keep the soil in good condition before the winter freeze destroys them. To ensure the quality is good, tests will be performed all year around to see if there are nutrients that are lacking. Furthermore, planting more cover crops also helps with excess weed yet keeps the soil full of nutrients. In terms of pests, organic farming involves controlling, not eliminating them. If the crop is strong enough, pests tend to avoid it. This is why good-quality seeds will be purchased and planted according to farming standards.
Supply Chain
Several actors will be involved in the business. However, as the farm is small, the supply chain consists of suppliers, the farm itself, and customers. We will contact reliable and affordable seeds (garlic crops) and fingerlings (tilapia farming) suppliers. Purchasing high-quality seeds and healthy fingerlings will directly impact the outcomes of the farm. Moreover, the equipment will be purchased from trusted suppliers of farming machinery. The laborers, contractor, and owner will deal with all the steps within the production and transportation phases. The next stakeholder, the customer, will be able to purchase the finished product at the farmers market where we plan to distribute our goods.
Human Resources Plan
As it is a small business, there is no need for multiple trained employees. Based on the analysis of the production process and finances, the farm requires three laborers responsible for both the crops and the fish farming. Some of the daily responsibilities include checking the water in the ponds for temperature and pH, separating breeding tilapia from the rest, feeding the fish, checking the filtration system, etc.
All the employees will have a schedule of five days a week from 6 AM till 4 PM. The farm will never be empty since some of the workers will work weekends and have two days off during the week. This will ensure that all the labor work will be done in time and no excesses will occur. Moreover, employees will receive bonuses for working overtime if they choose this option during the harvesting seasons. Since the harvesting seasons will be most challenging, it is crucial to motivate workers with bonuses. The plan is to have at least two laborers available on any given day. Each of the workers will be designated with different tasks daily. They will switch from fish farming responsibilities to garlic crop maintenance interchangeably.
In regards to the crops, the laborers will be involved in soil testing, crop planting, watering, harvesting, storing, processing, and packing. The laborers will contribute to every step of the process except for the transportation of the finished products. A hired contractor will operate this task. The contractor will use personal machinery to transport the goods to the next supply actor. The need for such services depends on the production, which is why the contractor will work based on the production schedule. This allows for a cut in expenses in terms of not hiring a full-time employee and avoiding purchasing other expensive transportation machinery.
As the small farm owner, I will take on marketing research responsibilities, supervise the employees, examine the marketing, look for development strategies, and research existing data on practical farming. As the business is still in the initial phase, I will also help with farm work if required, especially during harvesting seasons or other busy periods that require additional implications. Moreover, I will be responsible for planning and scheduling production plans, expenses, spending, and the overall financial domain of the business.
Financial Plan
The financial plan (Table 2) illustrates the farm’s economic potential during the first three years. After analyzing the market and our potential, it was determined that we are able to sell 1000 packets of seasoning and 1000 tubes of supplements in the first year. The supplements will cost $10, and the seasoning $7. Moreover, we will be able to sell 500 adult tilapias for 15.00$ each (first year).
After the breeding season, we will be able to sell 300 fingerlings for 2.00$ each. The estimates allow for a comprehensive plan that shows the possible outcomes and spendings for the next three years. Moreover, according to the calculations, the profit will substantially grow after all the necessary equipment is purchased. The highest costs are expected in the first year due to a lack of all the necessary machinery and materials for both garlic crops to be planted and harvested and the tilapia farm to be established, developed, and maintained. However, the current assets allow for such spendings during the initial phase since such inventory is permanent and will only need maintenance during multiple following seasons.
The current financial resources that are available to be invested into the business are $150,000. This is enough for purchasing all the necessary equipment and materials. Moreover, the current finances will cover the salaries of the laborers and the contractor for the first year. Table 2 illustrates the total spending, the production cost, and the revenue expected in the second and third years. Moreover, the profit margin for the crops alone will be around $6,000 per hectare.
Input
The production of the farm is based on conversing inputs into outputs. The inputs consist of human force (owner, three laborers, one contractor), the raw material (the fish and the garlic crops), and the natural resources (water, soil). The employees will be paid a reasonable wage, and the crops and the fish will be handled appropriately to maximize input. As mentioned before, the water will be filtered and controlled through equipment in terms of healthy pH, minerals, and temperature. The soil will be fertilized according to general garlic harvesting standards. Moreover, chemical pest and weed control application programs will not be used since we strive to market our products as organic.
Marketing Plan
After extensive market research, it has been concluded that there is a demand for high-quality organic seasonings and supplements. Moreover, the market of tilapia fish is always active due to the product’s price in combination with the nutrition value. While tilapia is a product that is always in steady demand, the market for organic supplements is growing every year. Consumers are more interested in the product if it is marketed as organic, which is our strategy.
Target Market
The target market is different for each product. For the seasoning, the target audience is women between 40-60 years old as this demographic is most active when it comes to frequent cooking. As for the supplements, two separate audiences will be most inclined to purchase the vitamins. The first one consists of people between 30 to 40 years old who are well-educated in terms of health and nutrition. The second targeted population is elders between 60 and 70 due to the decline in health and the benefits that they can derive from garlic supplements. The most likely buyers for tilapia are women between 40 and 60 years old who cook more often than other categories of the population.
Branding
We strive to have a strong positioning that contrasts with other farmers in the same field. This is why we will emphasize the fact that what we sell is healthy and organic. The demand for healthy foods is growing, which is why this strategy is beneficial not only for consumers in terms of health outcomes but also for us in regards to revenue. We aim to promote the Generaalsdraai farm as reliable, trustworthy, and honest towards consumers.
Market Strategy
Our market strategy is to focus on sustainability, simplicity, and naturalism. The brand Generaalsdraai will not resemble supermarket products that are made in extensive facilities. We will keep an effortless aesthetic for the packaging and rely on the fact that what we offer is organic, sustainably made, and effective. Instead of following standards, the strategy is to create unique customer experiences and a trustworthy relationship between us, the suppliers, and the consumers. Moreover, there is no budget for advertisement because the farm will be relatively small, and we intend to use the farmer’s market as a source of clients. The agricultural market in South Africa is growing. Furthermore, researchers mention South Africa as a significant agricultural exporter with a global influence (Fischer & Tramberend, 2019). The international market is also moving towards more sustainable and organic ways of harvesting, which is why Generaalsdraai will be a flourishing farm able to compete with other small farming facilities.
Conclusion
The Generaalsdraai farm will be a reliable and trustworthy supplier of tilapia, garlic supplements, and seasoning. While the business is small, our goal is to grow food security in our nation, and we can do it by producing healthy, organic, and nutritious products for our customers. Moreover, Generaalsdraai will become a profitable business in the next couple of years, which suggests that the idea of creating an integrated farm is practical from a financial standpoint. Our goal is to treat our future customers with respect by building a trustworthy relationship through high-quality products.
References
Climate Data. (n.d.). Mpumalanga climate and rainfall graphic. Web.
Fischer, G., & Tramberend, S. (2019). South African agriculture towards 2030/50. IIASA Research Report.
Riepina, I., Chukhraieva, N., & Kehrein, E. (2020). The influence of market risks upon the agribusiness value. Management Theory and Studies for Rural Business and Infrastructure Development, 41(4), 35–40. Web.
Appendix A
Appendix B
Table 1. Production schedule.
Appendix C
Appendix D
Appendix E
Table 2. Financial Plan.