Project
Project
Project
Prepared By:
Promoters:
1. Getachew Reta
2. Lewognesh Bekele
3. Meron Adefris
4. Yemesirach Mengistu
Purpose of the business: Production of Quality Poultry Products (Eggs and Meat)
Being the largest and most dominant sector in the country’s economy, agriculture constitutes
more than 80% of Ethiopia’s population. However, this sector is still backward and
underdeveloped. Yet, still it’s an area which could give high profitability if it is worked on,
Although poultry farm business is one of the widely growing businesses in Ethiopia the
contribution of the sector to the country’s total GDP is currently low compared to its potential,
this sector holds great promise as a source of export diversification and import substitution for
the future. Recognizing that large capital investments are needed to exploit the Ethiopia’s
resources, various incentives are being provided to encourage investment in the agricultural
sector including but not limited to the following: Guarantee facilities for loans by USAID and
specially when engaged in export, Conducive policies and strategies of the government
especially of this sector, so that the agricultural sector makes a significant contribution to
Ethiopia’s development.
Poultry products such as Eggs and chicken meat are among the main sources of protein in
nutrition and should be easily available both in quality and quantity for the ever growing market.
The increase in population coupled with improvement in purchasing power would make the
demand for quality egg and meat products to be increased at a high rate.
Currently the unsatisfied demand for poultry meat and egg in Addis Ababa is estimated at 7750
tons and 5410 tons respectively. The demand is expected to reach at 7845 tons and 11,283 tons
highly increasing market demand encouraged the Addis Youth Poultry Farm Entrepreneurs to
The Entrepreneurs have diversified experiences and academic background of different felids like,
entrepreneurship, business management, sociology, and sales experience. This modern poultry
farm has planned to rear 15000 chickens per year with rearing 5000 new chickens every 4
The site of the project will be at prime location in Oromiya Region Lege Tafo town on 1 hectare
of land, which will be acquired from the government on lease basis. The envisaged poultry farm
project has consumed total initial investment cost of Birr 862,000 of which 30% (Birr 258,600)
will be acquired from bank loan, and the remaining 70% is equity capital. Hence, the feasibility
study is aimed at determining the viability of the poultry farm project by capturing the current
and future demand for chicken meat and egg products in Addis Ababa and its surroundings.
The main findings of this study indicate that on the first year of the project it will generate a
gross profit of birr 7,140,000. In addition to that the project will have positive net cash flows
Consequently, both from the commercial and financial perspectives, Addis Youth Poultry Farm
is considered to be feasible and profitable. Thus, authorities for financial extension (banks and
credit associations) are expected to play their stake soon in providing the necessary loan for
unmet and growing demand for chicken meat and egg products in the urban centers of the
country.
In almost all urban retail markets and supermarkets of Ethiopia poultry products (chicken meat
and eggs) appear to be sold more quickly. Each and every people need chickens and eggs. Eggs
are the ingredient for cake, bread, omelet etc. so, cafes, restaurants, hotels, bakery, community
centers etc needs these poultry products every day. Thus, in addition to the normal household
consumptions the above mentioned other customers has high demand for chicken and eggs as a
Furthermore, with the growing number of large supermarkets in the city which has a positive
effect for the distribution of poultry products this project identifies the market opportunity in
The ADDIS YOUTH poultry farm company also plans to make its own contribution in terms of
protecting the health and safety of consumers by giving a significant priority and focus for
huge gap to meet the equilibrium between the demand and supply as a result of supplier’s failure
to satisfy their customers with their scarce products. Especially, in the case of food business
which is a necessary for daily consumption this unbalance between the demand and supply
of daily protein consumption. Although chickens are reared in most households traditionally yet
this barely serves the demand of the household and usually will not be served to the market.
Currently, the societies are facing a supply shortage of the stated products in the country and
trying to get these products with a higher cost on top of that. Having this in mind the intention of
this project is to engage in poultry farming and providing the associated poultry products for the
In addition Addis Youth Poultry Farm Company is designed to meet the domestic market’s
demand with better quality and sufficient quantity of chicken and egg products with focusing on
and having the very importance of these products for the society in every age in mind the Addis
Youth Poultry Farm project is conceived with a primary goal of providing adequate, safe
(hygienic) and high-quality chicken and chicken products(meat and eggs) to all residents and
institutions in Addis Ababa and the surrounding areas at a reasonable prices and in the long run,
to expand the supply of these products to other regions of the country so that the society can be
benefited at large.
and individuals in Addis Ababa and its surrounding areas. Addis Ababa, the capital city, has
population of nearly 7 million with an annual growth rate of about 3.1%. This population
constitutes 4% of the country’s total population and about 28% the urban population. With this
growing number in population size the demand for poultry products in the daily food
requirements of the city will increase substantially in the coming years. Thus this project will
benefit the targeted population by satisfying their requirements of chicken and chicken products
of generation of foreign currency. Its contribution can equally be well expressed at household
level by its role in enhancing income, food security and social status.
The poultry production system in Ethiopia, in respect to marketing situations, can be broadly
categorized into three systems: The urban poultry production system (the city, Addis Ababa, and
regional towns); the peri-urban poultry production system (proximity to Addis Ababa and
regional towns); the rural poultry production system (farmers in the villages).
However in most of the systems, the poultry products markets are dominated by informal
marketing systems. Almost all chicken and egg supply to Addis Ababa is from urban SME
poultry farmers in Addis Ababa and peri-urban poultry farmers located around the city in Oromia
The farms deliver chicken and chicken products to customers or, consumers may collect it at the
producer's gate. Studies indicate that in terms of volume 71% of intra-urban producers sell
chicken and eggs directly to consumers and payment to producers is generally on a monthly
basis. In addition, on the current market most of the poultry farms provide their products to the
market with a relatively high price while there are no standards or quality control mechanisms
farmers working in the proximity of the city of Addis Ababa and other regional towns.
Currently, Micro and Small poultry farm enterprises, the “Elfora” agro-industry and private
poultry farmers around Addis Ababa are supplying poultry products to the city market.
Nowadays, many investors are interested in participating in the development of the poultry farm
SWOT Analysis
SWOT stands for strength, weakness, opportunities and threats and we have made an analysis in
Strength
• Eggs and chicken are not seasonal products and can be eaten any time of the year
Weakness
capital funding.
Opportunities
Threats
• Outbreak diseases
significant and it comes second to coffee in foreign exchange earnings. Its contribution can
equally be well expressed at household level by its role in enhancing income, food security and
social status.
Almost all people in the country enjoy chicken and chicken products such as egg and meat in its
natural form and also use it to make a wide range of food products, including cake, bread,
Although poultry farm in general involves rearing different classifications of birds such as, duck,
goose, chicken, turkey etc, in Ethiopia the vast majority of poultry products used for commercial
and consumption purpose is from chickens. Thus this demand analysis focuses on chicken
related products.
As studies show the present unsatisfied demand for poultry meat and eggs in Addis Ababa is
estimated to be 7,750 tons and 5,410 tons respectively. And the demand is expected to reach at
7,845 tons and 11,238tons for meat and eggs respectively by 2020.
As complementary to these research findings, Addis Youth Poultry Farm company has
conducted additional assessments on the demands and most of the findings proved that poultry
products are in short of supply and the demand for additional diverse products is very high.
The project is planning to produce quality and modern breed chicken and chicken products egg
and meat for the market. These products, though badly needed on the market, are in limited
5. Technical Analysis
The main raw materials that are essential for this project are presented as follows.
i) Chicken Feed
The primary raw material required in this project is Chicken feeds. There are different chicken
feed producers in the country such as, Akaki Feed Factory, Ethio feed and Friendship Agro-
Industries. There is a difference in the type of feed for egg producing chickens and chickens for
meat. Thus considering this the feeds will be obtained from suppliers who have specialized in the
area.
Keeping the health and safety of our products is the main priority of this project. To supply good
quality products for the market having chickens with good health is compulsory. In Ethiopia a
number of vaccines for poultry are produced by one of the well known veterinary vaccine center
named Pan African Veterinary Vaccine Centre which is found in Debre Zeit. The center
produces a number of vaccines for poultry, such as live and inactivated Newcastle disease, Fowl
pox, and Fowl typhoid. Currently the Ethiopian government is registering more and more
veterinary medicines and vaccines. At the moment some of the most important suppliers of
veterinary products are: Equatorial Business Group, East-Africa Pharmaceuticals, Rang vet PLC
Beside the above mentioned raw materials some additional equipment are also required for the
Feeders
Feeders are equipments used in feeding poultry birds. The food is deposited in the feeder and the
birds feed from it. The amount of feeders provided for a poultry farm should be according to the
Incubator
An incubator is an instrument used for hatching eggs. Egg hatchery with an incubator can be
described as a means of hatching of eggs in an unnatural way. These means can be employed
Heaters
Heaters are equipments used in regulating and increasing the temperature of the poultry farm
especially during cold weather. These facilities help to keep the birds warm and comfortable
Chick box
The chick box is equipment where the poultry birds are kept for egg laying. It has a roll away
egg tray attached to it so that when eggs are laid, they roll away and the birds will not trample on
the eggs. This particular equipment help in preventing the eggs from damage.
Egg Tray
These trays are tray-like equipments which are used for setting the collected eggs without
Ventilation Fan
Ventilation fan is equipment used for ensuring maximum ventilation in the poultry farm and it is
used for reducing the temperature of the poultry farm during a hot weather.
Laying Nest
Laying nest is equipment that helps the birds for lying of eggs. One of the advantages of this
Egg Scale
This is equipments used in weighing the weight of the eggs. It helps the poultry farmer know the
eggs that are fertile enough for hatchery because it is assumed that an underweight egg does not
Clean water is a basic necessity for a healthy growth and digestion of poultry birds just like in
humans. Therefore, the drinkers are equipments used for supplying water to the birds.
Cages and Coops
This poultry equipment is used for keeping poultry birds. Coops and cages are poultry
In addition to the above mentioned equipments, the use of protective clothing for humans is also
very essential. Some of the protective clothing required for this project are hair caps, rubber
gloves, boots and coverall are required to avoid transmission of unnecessary pathogens or
Poultry farm equipments are available in several farm equipment distributors. The distributors
import these equipments from several companies in abroad, such as Belgium, Italy, the
Netherlands, India, China, etc. The well known importers and suppliers in the domestic market
are Gasco Trading, Wise team PLC and Friendship Agro-Industries which supplies own-made
the regional government on lease basis. This location is chosen taking into account the
availability and reliability of basic infrastructures like telephone lines, asphalted road, power and
water supply, and considering the proximity to target market as well as the favorability of agro
climatic conditions.
In addition, we think it is a spot that could tap a healthy workforce. We also considered
pedestrian traffic and we think a large percentage of them are potential customers.
5.3 Environmental Impact Assessment
This section briefly describes some of the environmental impacts associated with the primary
The main environmental issues associated with poultry farming are: the generation of solid
manure and manure slurries, which may pollute surface water and groundwater. In most cases,
the solid manure from chicken droppings is applied to pastures and cultivated land.
Beside this effluents from the farm are generally held in some form of lagoon to allow
sedimentation and biological degradation before they are irrigated onto land.
Manure wastes represent a valuable source of nutrients for fertilizers. However improper storage
and land application of manure and can result in serious pollution of surface waters and
As for many other farming operations, the main environmental impacts associated with all
poultry farm activities are the high consumption of water, the discharge of effluent with high
organic loads and the consumption of energy. Poultry farming requires very large quantities of
fresh water. Water is used primarily for cleaning process of equipments and work areas so as to
maintain hygiene standards. The dominant environmental problem that could be caused by
poultry farm is the discharge of certain quantities of liquid effluent. The effluents generally
High organic load due to the presence of organic components from the chickens;
1. Look for workers and proper site for the project. The workers shall consist of the following:
Poultry Caretaker 1
good returns on investment. Both poultry and pig farming are labor-intensive enterprises. For
maximum production, efficient labor is required on daily basis. Therefore close supervision is
necessary. Feeding, watering, cleaning and sanitation, observation of diseases and disorders,
collection of products for market and arranging an efficient system of sales must be well
The management teams of this project are simply the partners of the business who has held
1. Yemesirach Mengistu
- As the top manager or the CEO, she is typically responsible for the entire
initiatives and to maintain the smooth operation of the poultry, with the assistance
2. Lewognesh Bekele
- She is responsible for analyzing and reviewing financial data, reporting financial
3. Meron Adefris
- Assessing the existing market for the farm’s products, and in charge of all
4. Getachew Reta
areas.
Other Personnel
In addition to the management team, there are also other personnel in the poultry farm which
works in the day to day activity of the farm. These include Cleaners, Security, and a driver. All
Total 7 13900
Organizational Structure
General
Management
Investment Structure
Land 1,000,000
Building 300,000
Working Capital
Our project has start up cost and we will need a bank account, we chose our bank to be
commercial bank of Ethiopia because of its proximity in the area. This section of the plan shows
Start-up expenses for the project include initial insurance payments covering both general
liability and product liability, pre-launch marketing to cover flyers, a direct mail campaign, and
advertisements in local papers, the development of a website for customer interaction, and the
normal legal expenses for consultation and permitting. Other current assets include office and
store furniture, shelving, a computer, phone system, and tools. Long-term assets include the
In our business, the financing structure and ways of doing it is like the path below.
1) Equity contribution: this cover the land we are using for the poultry, and also the facilities in
the building. The total income will be store rooms, office and constructions as well as the
furnishing part.
2) Personal income of 1 million birr, which will be used to start-up the operations, the hatchery
Since for a part up business borrowing money from a bank is not advisable for our financing
project. Financing by loan becomes our secondary motive if we can get enough income for the
start up business. When we borrow and use personal income, it is easier to obtain and quicker
Expenses
purchase
purchase
Financial risks
Health risks
Contagious disease and virus outbreak is very deadly; if one of the chickens should catch the
disease, all of them will be affected and if it's not recognized and treated early it will lead to the
death of all the chickens which is a great loss for the business. And also some of the diseases are
also contagious to human not just between the chickens which will affect the workers and also
Disease prevalence varies from one area to the other. The problems that may trigger disease
conditions are direct sunlight on egg trays or nests, poor ventilated houses and very high
temperatures in and outside the poultry house, which may weaken egg shells resulting in poor
egg quality. All these conditions will be avoided to the best of our abilities.
Another thing we considered during the risk assessment is the mortality of the chickens which is
inevitable since we are dealing with living things. This can be managed with good management
Technological risks
Technology is good but they also have their disadvantages. There are normally problems
involved in using technology; the use of the machine that collects eggs may fail to work or spoil,
making the work slow and adding more cost to the business by repairing it.
The cost for electricity is also not easy and some electric problems can lead to fire outrage and
burn the building causing the loss of assets and perhaps the entire business.
Contingency plans
As we considered these risks we have also made contingency plans for unprecedented events or
occurrences. As per the health risks, we will have plans with a veterinary doctor that will have
regular checkups with the chickens while giving them the best environmental conditions.
Another contingency plan we will make is insurance that will protect our assets.
The occurrence of a fire outrage will be curbed by placing fire extinguishers at strategic places.