There have been quite a number of concerning interests in the agricultural value chain and the wealth it seems to offer. The benefits this sector holds is a huge goldmine that is yet to be tapped and processed into unending wealth production. With the current state of interest by every stakeholder in the Nigerian economy, no doubt this sector is set for wealth creation.
Three Things you should consider in farming the green gold.
1. Do you home work: As profiting as the agribusiness is, you still need to do a lot of realistic assessment in comparison to facts available. In as much as various sector tends to appear profitable, be well abreast with the feasibility survey of the sector(poultry, arable crops, animal husbandry, piggery, apiculture etc) you intend venturing into. First is to see the policies available in that sector, as well as the governments interest in same. Also set out to know your immediate target market (agents, middle men, wholesalers and final consumers), this will help you to have a broad view of the prospects, in terms of long term profitability and short term losses. Have an idea of the entire value chain of that sector. Take for instance poultry; products available are the eggs, the birds sold live as fresh meat and frozen meat. Having in mind the necessary tools needed to profit from each value chain.
2. Set out on the Proposal alignment: Quite a lot of people may hide under the guise that its their project so they do not need any proposal, as what they intend to achieve is in there head. As this may be right, but you still need to put it down in black and white. This would give you a clearer perspective of the venture when compared with the reality on ground. It is easy to say that aquaculture is profitable and gives about 30% profit markup. The reality is that there are competition to face also and this you need to identify and have a strategy to break into the market and get known, as it is a free entry and free exit market.
3. Don't dive in, put in your right foot: It is obvious that the banks and loan facilitator may not be interested whether you use all the funds at your disposal or not, as their repayment plan must be adhered to. Yet stick to a common business rule, test the market. Go slow on step at a time. Yes volume is key in business, this may be true in the service business, but in agriculture, sustainability is key and it translates to profit. Once you can sustain your produce, volume will take care of itself. Take for instance, if you proposed budget is for 10,000 birds, I STRONGLY ADVICE you start off with one quarter (2,500 birds). See how the process goes for 3 months, then you increase in doubles or at percentages over the year. Once you can successfully manage 25% of the initial produce, then you can work out modalities for increase. This may not be applicable to existing agropreneurs as I assume you may have understood your process.
Every business has got its thick and thin side, so also agriculture is not spared. If not properly done would nose dive, so also it could be a great harvest. Its not a constant line graph sloping upwards like other businesses. As the factors that are impeding profitability and growth are enormous. Apart from the human factor of power, personel and policies, there is the force- majeure (act of nature) which you may have little or no control over. Such a s thunder storms, rain storms, drought, flooding, air/water borne diseases etc.
You need to also have a clear picture of the factors you can control and mange, as well as those you cannot control, but reduce their destructive impact.
Remember, profit is key to any business, even if you love agriculture from the marrows of your bone, without profit there would be no continuity.
I encourage everyone to look and invest www.agricshow.com in the Nigerian agriculture economy, its a green gold mine field yet to be tapped.
