BUSINESS DRIVEN BY NEED
BUSINESS SOLUTIONS TO HUNGER IN THE LAND - VOL 1: CHICKENS
Nigerians awoke to the chaos of protests on August 1st, some in support, others not so much but all of us fully aware that Nigerians are suffering - for those who venture, meet opportunity.
Tues.August.6.2024 - Ubochi Eke
The businessman who anchors his actions on need, can find no better hunting ground than the Nigeria of today. The Nigerian government and the old order of business and Social leadership has left the country a wasteland but the land is not barren and the people are not dumb, as such greed has merely created opportunity.
Often my friends and family from abroad ask me about business opportunities in nigeria, well here are the top 7 opportunities to solve a piece of the hunger in the land, while grabbing land sized rewards.
For easy reading and to ensure an indepth collection of articles that are truely helpful to the reader i will split it into 7 Distinct Articles. This is Volume 1, on Chickens.
POULTRY CHICKENS
When people are poor, proteins are the 1st thing that goes out of the window. in Nigeria today and maybe much of Africa there is a drastic reduction in protein consumption much to the dismay of human nutrition and also to the general ecosystems of Agricultural productions that sustain it.
In Nigeria and much of Africa, the mix for animal proteins fall in this order 1. Cows (Beef), 2. Goats, 3. Fish, 4. Poultry (Chickens) and 5. Bush Meats (Hunted variety).
Of all of the aforementioned, pond fishes like Catfish and Tilapia, and Poultry like Chickens and Turkey form the lowest hanging fruit as a solution to malnutrition and food affordability in the country.
For the purposes of this article i will focus on Chickens, specifically Meat Chickens.
The Meat Chicken presents several opportunities that are a direct result of food inflation in the country and it has many challenges that make it a perfect investment for the Nigerian who is truely concerned with the development of his people and can make a great profit through great impact.
STATUS QUO
due to the rising cost of foreign exchange and the dependency on foreign inputs for animal feeds in Nigeria, especially Chicken meal, Meat chickens have become excessively expensive and terribly inaccessible for the masses of Nigeria and much of Africa. Furthermore the imported alternatives (frozen Chicken) from European countries are still in accessible due to the steep rise in foreign exchange
On average today, a 2kg Broiler Bird will cost N8,000, the same size cost N5,000 2 years ago and a mere N1,500 10 years ago, under the administration of President Goodluck Jonathan.
In reference, the average wages for the average Nigerians are N30,000, N25,000 and N15,000 respectively for each of those years. The implication is that while the cost of Chickens have risen 533%, the income and purchasing power has lagged behind, rising by a Paltry 100%. Even with the recent rise in the Official minimum wage, we expect the average wage to merely rise to N50,000, the skew Occasioned mainly by the rise in income for Government Employees.
WHY CHICKENS AND NOT THE OTHERS
opportunities exist in Goats, Cows, Snails and just about any other source of protein, but I specifically chose chickens due to their 1. Speed to harvest, 2. ease of Management, 3. Scalability on any budget and 4. Instant impact on the economic story.
in speed, a Broiler Chicken reaches max maturity in 3 months with many being market weight by 45-60 days depending on the intensive nature of the farming practices. Native free range Chickens can also reach market weight in 9 months and other varieties like Cockerells can reach market weight in 6 months with less intensive efforts.
In ease of management, Chickens are much more of an easy entry into farming than the idea of ranching cows whose mere size can be intimidating, attitudes dangerous and the nature of housing and land needs Prohibitive.
In scalability, Chicken farming can be started in the backyard and can also be done on an industrial scale and you can easily start small and grow into whatever your dreams and zeal allows. This is harder with Cows and even fish need minimal economics of scale for profitability and have construction needs that make them inaccessible to smaller capital, unless you are farming near a natural stream or in riverrine areas.
In Instant impact, the time to market, general acceptability, nutritional value and other attributes of the meat Chicken provide a clear path to a positive contribution in the society, now, or to be more specific, within 90 days.
WHY CHICKENS AND NOT THE OTHERS
opportunities are found in the gaps between the ideal and the status quo and presently the gap exists in the deep dependency of Chicken Farmers on 1. Imported Feeds, 2. Western Techniques, 3. imported Chemicals and Drugs and 4. Subsistence scale Agriculture.
1. In the importation of feeds, Chicken farming is consequently dollarized and is no longer market relative much in the way that Cows remain relatively resilient to currency fluctuations. in fact, as the currency balloons the changes in cow prices are more an extraction of margin by their owners, as the cattle rearing process does not really have any dollarized costs.
2. In adopting Western techniques, our people fail to recognize climatic differences and the general perfections of utility scale infrastructure that enables the likes of Al marai and Purdue to farm at the scale that they do and with the intensity and automations they Implement.
For the nigerian farmer, with access to low cost labour, to over mechanize is to loose the inherent employment opportunities that are present in manual productions and is an unnecessary expense since the cost of manpower is much cheaper than the cost of acquiring the systems for a Western style farm.
3. In depending on Steroids, Pharmaceuticals and Feed additives, we essentially split profit margins with Western Giants and further Impede our ability to sustain productivity, year in and year out. We waste scarce human capacity, when our Food and Animal Science graduates are left to waste without funding for basic research on the natural advantages that surround us in food and medicine, all of which can increase productivity while reducing cost and making the processes of care so accessible that mortality rates are also positively affected.
4. In farming just to survive, one is never innovative enough to survive the ever changing malaise of policy Summersaults that out nations keep Heaping on their citizens, furthermore, one is incapable of building a concrete business, the likes of which is needed to gradually and Entrepreneurially rescue our peoples, where Governments, Enterprises and the Social Institutions of today, have woefully failed.
MAKING IT PAY
if you can build a Chicken Farming Enterprise with the following factors managed, i am sure of your success.
To succeed you need to farm with the capacity to ensure the following, 1. independent feed formulation, 2. Independent grow out Plans, 3. Scalable plan, 4. no dependency on the farm for immediate daily bread and if possible 5. independent production of Feeds.
FEED FORMULATION: Since feeds form the most dramatic inputs in Chicken farming, it is essential that you at least work on a formula for feed production that is based on local inputs. It is ridiculous for us to try to produce feeds based on purdue formulas developed for American Broiler farmers. Wherever you are in nigeria or Africa, find the waste products and by-products of other food productions that can be added into your feeds, such that you can mill your own feed within your area. This will lead to steep reductions in the cost of feed and increase your profit margins.
it is however not an easy way out, but a serious matter, that requires that you invest in adequate research, at least to the extent that if you cannot device the feed yourself, you can at least find a local University and ask the students or Professors for help in formulating feed from locally available inputs. To do this right, you must be willing to fund the research. this should be easy because if you fail to do it, you will still foolishly lump off cash to feed sellers for American innovations that kill your margins.
for Example, Enugu, Anambra and Lagos, house Beer brewers whose plants generate massive amounts of Spent Grains of Wheat and Barley all of which can be used in feed production. For those in areas with high cassava production, you can look to integrate Aribo (Dried Cassava) and Cassava Peals. For those in Palm Oil producing States like Imo, Enugu and Edo, you can look to introduce Palm Kernel Cake etc. For those in the north, find formulas that use whole grains, soaked grains and grain sprouts since you can easily access grains at a massive savings to other regions.
This of course in an over simplification of the subject matter but i hope that you get the point in summary.
GROW OUT PLAN: You must also draw up a grow out plan that is suitable to your own intentions. For example, if you have access to ample rural land, why would you want to raise caged birds? it would make more sense to build a cage for the Chickens to shelter in but in general to draw out your major plans around allowing the birds to roam freely. While this will adversely affect their speed to market, it will support their overall health, limit mortality and with proper Planning will have positive effects on feed expenses, as they grow in sunlight and water.
i remember vividly, that we grew up on very plump native Chickens. Back then, the idea of the Broiler was not a trend, and it worked. I have also raised Broilers of my own that roamed part of the day, the roaming was not such that it became exercise but more of a small yard in front of their cage that allowed them to bathe in sand and soak in the sun. In my case the only adverse impact was that they required more time to make weight.
Why not, when the dollar is rising through the roof? Can't we afford to wait a little and bring to market, Chickens that our people can afford? Chickens that you can sell profitably, just by giving them a little time in the Sun.
SCALABLE PLAN: Whatever the level at which you enter the business, i strongly suggest that you have a plan to scale. Even when you have billions to spend, I would not suggest that you pour it into the market all at once. No matter the scale, i suggest a plan that starts with the instant market needs in mind but is also built to grow with the market and to stimulate the growth of the market both in terms of the affordability of the Chickens but also in pushing appetites and budgets towards Chickens as a go-to protein. Your plan must not be a plan to conquer the Nation, it can be a plan for a State, City, Village or even just total domination of your Street or School.
In writing, I do not pick winners, as such this same plan can readily apply to other areas of Meat productions, i however chose Meat Chickens as more apt to my intentions with these 7 articles. it sinks more perfectly into the immediate possibilities in quenching the hunger in all of our bellies, while ensuring that you do not empty your pockets for nothing.
NO IMMEDIATE DEPENDENCY ON THE FARM FOR FOOD: Subsistence farming is not a business. It is moreso a very stressful way of "Owning your job". It is not a business, period.
As such much of the complaints about the unprofitability of Agriculture in nigeria and Africa comes from the fact that we in the Wealth Classes avoid it and leave it for people who cannot sustain the jestation periods needed to allow the investments to finally mature and pay the right dividends.
While a Broiler Chicken Farm (90 days), other Commercial Chickens and Turkey (180 days) and Free Range Native birds (270 days), can begin to yield returns quickly, they are not something that should be done for subsistence but should be a commercial venture that is planned out and therefore allowed true investments including the reinjection of yields until they reach a true point of maturity, in line with your own Visions and scale and can then become cash cows.
When this is purely a business and not an immediate source of income, you can gently build it out for efficiency and ensure that it is truely a solution to the local, regional, national or continental problems that you wish to solve.
This is no way means that small scale farmers cannot enter. At any scale, you must identify a market that needs you and build to "seal" at scale, your peculiar market.
For example, you can farm just to serve your neigbourhood or Estate. You must therefore know the gaps in their access to Meats in general and Chickens in particular and build a business that can stamp out the need for the neighbourhood grocery store or the area market, which ever best applies to what you are doing.
A successful Chicken Farm can be merely 50 Chickens but it cannot be your own source of protein, or you may eat your profits.
iNDEPENDENT FEED PRODUCTION: Chickens are feed and Feed is Chicken. As such the holy grail of Chicken farming is the production of feeds. This can be classified into 3 categories, namely 1. Feed Production, 2. Feed production plus inputs Wholesale and finally 3. Feed Growth and Production.
In the 1st instance, you merely have the equipment to produce your feed and the ability to buy inputs and additives in large quantities. This can also be just the ability to buy feeds in sufficient scale that you can chip off a 5% margin from the wastes in the logistics and retail purchase price, giving you more competitive margins over less optimized neighbours.
in the 2nd instance, you engage in the trade of the feed production inputs such that you can earn a margin on the mere consumption of your direct wholesale feeds. With this approach you earn a guaranteed profit through internal consumption by your Chickens of wholesale goods which others have to access at retail prices. in this instance, it is also ideal to complement this activity with actual production of the feeds and possibly the sale of the feeds to others, no matter the scale of your productions.
The main aim is to increase margins automatically by 10%, simply from your own consumption.
In the 3rd instance is the development of an integrated farm such that your Chickens are consumers of products you farm, mill and sell, such that you have created a cyclical enterprise that nets at least a 15% margin over similar sized competitors simply on the basis of intelligent design.
These are not theories, I have put each of them to practice in real world research and it works. The basic excess of inefficiencies in Nigeria make mere optimization a great way to achieve margins that near, equal and in some cases exceed the normal trade margins of "any" business.
in each of these instances you can choose to pass the savings down to the consumer, pocket it, or use it to scale your business. no matter what you do, the economy will be better off.
even if you just pocketed it and were feeding fine on your people, no problem, because at some point you will need blocks or buy new pants that are more fitting to your pocket. In the worse chase, no hunger in "your" lands.
better any of these than the current trend of wasting scarce foreign exchange on Wheat and frozen Chicken.
IMPACT
The impact? hunger in the land, will need to sit down for a minute with this 1st punch.
we always fail to recognize the impact of the small activities of everyday men, in making the world better or worse. No matter your economic capacity, if you enter into Chicken production with the average mans stomach in mind, I can assure you of genuine success and in no time at all, I can also assure you that your efforts will make great impacts on the lives of everyday people, directly or indirectly.
SMALL TIME FARMING: the small time farmer should target an objective niche like a neighbourhood, Breeding type, Packaging approach or any other unique attributes that will allow his small productions to be a "dependent" need for his target audience.
For example, if i was doing a small farm of say 50-200 birds, I would never take my products to the market. Traders will haggle you into quitting the business. i would rather find a nitchie audience of neighbours and sell to them at the gap between the haggling of the market and the profiteering by traders. This is to say that if the market sells at N8,000 and buys from suppliers at N7,200, I will fight to find customers who are willing to pay N7,500 and serve them well. In fact i would be willing to serve them so well that when they add the service provided they will find that they cannot walk out with a Chicken in the same condition and with the same convenience for under N8,200.
These additions can be as simple as killing, cutting and packaging options. it can also be mode of delivery and in fact it can be as simple as the way in which you greet and thank them for buying from you as opposed to buying from the market, showing extreme gratitude even though you both know that they are buying from you, in order to save.
in my own research i have found that many small-scale farmers overcharge the local audience for their own failings and inefficiencies and in an attempt to recoup the damage done to them by wicked market traders, who are willing to price at charity levels for even the best Chickens.
At this scale you can change the lives of those in your community by providing them access to quality nutrition and a savings on the logistical inefficiencies of sourcing their Meat from afar.
BUSINESS GRADE: If you at least have the economic capacity to sustain 1,000 to 5,000 birds, then you are truely in business. In today's market this will require N4 - 10million depending on your level of patience and the outfitting of your farms. These costs articulate grow out costs and cheap housing and do not articulate land and the cost of more permanent Chicken housing.
This is the right entry point but you do not need to start here. You can start small and then strive to get to this minimum so that it is truly a business that can sustain you and your family.
A Chicken farmer with a N50million investment can net as much profit per annum as a N900million hotel. if this doesn't motivate you and justify the "shitty" nature of Chicken farming, then i can't help you.
In the area of impact, such a business can sustain the businesses in its area, like neighbourhood meat shops, you can also sustain an entire community if you are located in a rural area and can comfortable seize up city blocks and Estates if you choose a direct to consumer approach. in fact you can merely open a meat shop simple to retail your own Chickens and still make a steady "killing".
BIG BUSINESS: the ideal however is when a true businessman who has economic success in other areas, takes his time to make a laboured investment in Chicken farming. i believe that the ideal farm size for economic dominance of a region in most states is A1million.
When the investment is at this scale you have the ability to truly purchase inputs at wholescale or scale down the bird volume and actually farm portions of your feed or in the best instance, create an integrated farms whose efficiencies are optimized for Chicken production.
Such a farm can easily do 50,000 birds without issue and clock much better profits than 3 hotels built with 3 times the money.
in terms of impact, just the change in the mindset of the people about agriculture and Chicken farming in particular is quite an impact. this impact can be much better felt if the design of the farm and its general developments showcase genuine concern for the quality of life for the Chickens, cleanliness in your farming environment, supportive tools for staffs' mental development, physical health and task ease and all the appurtenances of a refined business that will encourage adoration and imitation.
Furthermore, such enterprises will drive down the cost of access to food and Chicken's in particular, not merely by sacrificing margins but in the regular course of business, the stimulation of the competitive environment, innovations and efficiency and the general availability of local supply.
DANGOTE: In the ideal, I look forward to whoever will do a multi-billion A investment in Chicken Farming. such an enterprise will alleviate the needs for Nigerians and can even meet export demand for the West African sub-region. if nobody does it before me, them of course am ready to take up this particular challenge.
1-2 billion A properly invested in Chicken Farming will easily yield 1 million birds per day, a figure that dwarfs Nigeria's needs of 500,000 birds per day. This should not be done at once as it will destroy the market, but with conscious development over a 3-5 year period. this can be done without market disruption and will provide the market with adequate supply for internal consumption and external need, of course such a development will incorporate farming and feed production and can be fully independent of imported inputs.
this is needed, it has been far too long that Africa has depended on the foreign for even basic feeding and it is about time we capture our market and crash theirs.
The impact?
hunger in the land, will need to sit down for a minute with this 1st punch.
And by the way, don't our children need the break of actually eating like the rest of the world for a change? Get in the game, if you're not Chicken.
Business should be driven by need!
CONCEPT
THE RAW NAKED TRUTH
this is a syndicated Article Released Every Friday and taking an Unbiased Approach to unraveling the implications of the weeks leading events to the Lifes of My People.
Read with an open mind...
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