Maize production by Women in the rural areas of Wakiso and Luwero

ROCKFORD HARRIS GROUP -PROJECT PLAN

Confidential & Copyrights © 2008 – Request permission to share or copy from the author 1

BUSINESS PLAN

Rockford Harris Group, Ltd

Shaka Robert

Chief Executive Officer, Rockford Harris Group.

P.O.Box 12451 Kampala

Station Office, Plot 35B, Luwero Road, Kasana Kampala Uganda

Tel: (+256) (774) (131555)

E-mail: [email protected].



0. Executive Summary:

PROJECT TO BE DEVELOPED:

Until the early 1990s, Maize trade was of less value in Uganda because quantities available for trade

were very low. Besides, quality and standards for Ugandan Maize is not valued. Maize production

in Uganda has increased from 50,000 to 170,000 tonnes per annum. This has made the country

reduce Maize imports from 60,000 metric tones in 2005 to 35,000 tonnes in 2007, saving about $30m

in the process and improving food security. However, due to lack of adequate storage facilities,

Maize grain cannot be protected and held for future sales. As such farmers accept whatever prices

they can get before their produce gets spoilt due to poor storage on farm. This is a contributing

factor on rural household poverty and food insecurity. In the months of April, May and June, when

the stocks are depleted, any available grain is great in demand.

In-spite of the many interventions made by government and Non-government institutions in the

agricultural sector, agricultural productivity and financing in Uganda has continued to decline.

Financing Agriculture in Uganda today requires mitigating two principal risks, 1. Production Risk

(the probability that the crop may never be harvested) and 2. Price Risk (the probability that cost

of production may be higher than market price). These realities discourage financiers from engaging

in financing agricultural value chain activities that are long term or non-collateralized.

Most Financial Institutions consider that the only way to finance agriculture is the traditional

way—that is financing production. Looking through the production finance lens, small producers

can rarely access loans because they lack collateral, loan amounts are small and the time frame for

lending is too long.

The Business Plan herein focuses on implementing an integrated market oriented, sector specific,

public-private intervention aimed at introduction of a Modern Maize Drying & Milling Equipments

and Warehouse receipt services . This package resolves many of the constraints to financing

agricultural sector and the associated agricultural production and marketing challenges because the

product (crop) is financed only after production, product is self-collateralizing and the loan terms

are normally short. Access to warehouse receipts encourages production and productivity because

opportunities for greater revenue (through temporal storage) become realistic to producers and cash

in hand from receipts directly finances production at no risk to the lender.

The Goal:

Transformation of the Maize sector through creation of public – private partnership opportunities

for improving rice productivity, quality, profitability and competitiveness among small scale

farmers in cental Uganda through access to a Modern Drying & Maize Milling Equipments and

warehouse receipt services as a model of value-chain development and market access.



1. THE BUSINESS

1.1 Business model and value proposition

Give a short description of the business model of the company – how will you make money?

ROCKFORD-MPBM focuses on geography of Five (5) Maize growing districts in Central Uganda

that will constitute the business production area namely Luwero, Nakaseke, Nakasongola, Wakiso

and Mukono. The target beneficiaries consist of groups of smallholder Maize farmers in the five

districts named above that are actively engaged in rice growing as the primary producers in the

value chain. Special interest groups such as out of school youth and active women groups. The

intention is to alleviate poverty among this category of the populations through provision of market

opportunities as well as maintaining conventional business principles for a Market Access Company.

It will identify key value-chain actors and build smart business linkages maximizing efficiency at

all levels through training, agro-processing, product developmnt and marketing.

The Business Plan is an evidence-based strategic intervention based on research and

development(R&D) studies by Rockford Harris Group for the National Agricultural Advisory

Services (NAADS) on how to enhance the capacity and the business development capacity of

smallholder farmer enterprises in Butaleja. The intervention is therefore demand driven with

business potential in the following services that shall be offered on a commission basis.

Warehouse Services on commission basis of 2% of farm-gate price per unit of the product.

Agro-processing of produce at a commission of 7% of farm-gate price per unit.

Product development, marketing and distribution as a commission of 3% of total volume at

farm-gate price per unit.

RPBM (Legal Corporate Business Entity)

Building Business Partnerships with Uganda Commodity Exchange,

Post Bank Uganda & Smallholder farmer groups

Smallholder farmer Enterprise Groups

Product Consumers

Warehouse Reciepts for crop finance

Storage of produce on commission

Agro-processing services

Grain purchase from farmers at

farm-gate prices

Value addition, packaging &

Branding

Capacity & Business enhancement

farmer groups

Product & Brand distribution

Franchise & retail contracting

Logistics and transport.

Researching consumer tests

fere

Linking farmers to consumers

Business Linkage Diagram



The company will manage a host of warehouses for storage of produce at a commission.

It will also offer warehouse reciepts that can be cashed by Post Bank in collaboration with

the Ugandan Commodities Exchange( Bank Interest rate 10%/yr paid after sale of produce

by company in addition to principle).

Cummulatively the company will have a total commission of 12% of the total value of the

produce at farm-gate price per unit.

Ugandan Commodities Exchange will have a commission of

Post Bank Uganda the financial partner that will clear warehouse reciepts with the

Ugandan Commodities Exchange will take a commission of 10%

Diagrammatic Representation of Business Implementation Model.

The multi-dimensional nature of the underlying constraints to the Maize sector calls for an

integrated strategy involving multi-disciplinary partners implemented through a public private

partnership. The business plan components and partnerships envisaged is enlisted in the table below

through a Value-Chain Approach.

Small Produ

Input Suppl

Traders

Processors

Wholesale and

Market Access Company run by local entrepreneurs offering market access services to small producers and market

Private National Company of support service providers operating at national level

Value Chain

Small Enterp

Support

Linking Local Learners

Market Access Service

Value Chain Actors



Potential Business Partners.

Activity/project component Project partner Type of partner

Ensuring adequate production

volumes to cover fixed collateral

management costs

Maize Producer’

Associations (DORSEFA,

Busolwe, etc)

Identified entreprise

farmers’ groups.

Quality control of the

commodity

Rockford Harris Group

(Promoter)

Private

Sound warehouse facilities Rockford Harris Group

(Promoter)

Private

Reliable market to off take the

commodity

AgriNet Uganda Ltd Private

Building trust and confidence

with producer associations and

other partners

NAADS &

Africa2000Network

Public & Civil Society

Provision of an efficient banking

system to discount receipts

Uganda Commodity

Exchange and Post Bank

Uganda Ltd

Public Parastatal

Modern Maize and Rice Drying & Milling Equipment and Warehouse receipt services . will be

fabricated and supplied by AGRO-INDUS company which has more than 26 years of experiences

in fabricating and supplying high quality modern Paddy Dryers, Paddy Storage Silo, Maize Milling

Equipment, Maize Processing Equipment, Maize Storage Silo,Maize Handling Equipment (Bucket

Elevator, Chain Conveyor, Screw Conveyor, Belt Conveyor).

Contact: Email: [email protected] today and send us your enquiry. or Call us now at +256

774131555

RICE V A L U E C H A I N A P P R O A C H MAC will provide warehouse reciept services,buy produce from farmers, process and package product for marketing through various franchise models.

POST HARVEST RISK MANAGEMENT,

Handling knowledge, Handling Technology,

Storage(WRS), Grades and Standards,

Traceability.

PACKAGING

Format by industry user, Format by consumer

market segment

CONSUMER MARKET

Rural, Urban, National, Regional,

continental, Niche, Mass market ,Nutrition, Industrial

AGRICULTURAL PRODUCTION

Genetic material, Fertilizers, Crop and livestock chemicals,

Farming systems, Water, Environmental sustainability,

Production, Household livelihood,

risk management

PROCESSING

Transformation of a Commodity,

Combining ingredients

TRADE LOGISTICS

Market information, Commodity price setting,

Production/Transformation inputs, Margin negotiation



1.7 Company structure

1.7.1 Management

The company has Technical and Support staffs for Administration and Operations. The

strategic Team deals with Administration-Marketing, Finance and HR. The Operation Team

entail a core group of field agents, logistics and transport staffs, warehouse support staffs,

Inventory control experts, product development, milling specialists etc. At the moment I

have a Team of experts on ground together pushing this business plan forward.

Mr. Lugasira Henry. Henry holds a degree in Public Administration and management and

diplomas from Nkumba University, International institute of Environment, University of

Virginia, Howard University and United States Telecommunication Training Institute

(USTTI). He has worked with National Agricultural Advisory developmental services, Action

for the needy, Uganda parent’s care for the mentally handicapped children. He is currently

the deputy C.E.O and heads production department for Rockford Harris group

Mr. Paul Nyende. He holds a Masters in Agricultural Economics & a Bachelors of Science in

Agriculture from Makerere University. Paul has been a Project Coordinator for Africa2000 Network,

a Program Specialist with the UN Food & Agriculture Organization, Consultant for the National

Agricultural Advisory Services (NAADS) on Agricultural Information Systems & currently a Lead

Manager in Rockford Harris Group.

Mr. John Ereng. He holds a Master of Science in Agricultural Extension, Birmingham University,

UK, and a Bachelor of Science Degree in Agriculture, MUK. John has been a Project Coordinator

for Africa2000 Network. He has experience in business and product development having worked for

Strasburg in Ethiopia & British American Tobacco in Uganda. He is currently a Business

Development Consultant for Rockford Harris Group.

Mr. Kuteesa Wilberforce. Wilberforce holds a Bachelor of Business Administration, MUK Business

School. He also has a Higher Diploma in Stock and Inventory Control Cambridge Tutorial College.

He is a CIPS certified Logistician. He has worked for Mantrac as an Intern and now with Rockford

Harris Group as a Warehouse & Logistics specialist.

Ms. Helen Namulwana. Helen Holds a Master’s Degree in Business Administration, MUK, Bachelor

of Art Degree in Social Science, MUK, a Diploma in Public Administration, Uganda Management

Institute. She has worked as a Program Coordinator for Uganda Child Right NGO Network, a

Consultant for the Swedish International Development Agency in Oslo, now a business consultant

for Rockford Harris Group.

The Warehouse Receipt System service will be provided by Uganda Commodity Exchange (UCE),

the Uganda Government authority licensing WRS in Uganda.

KEY PROJECT ACTIVITIES

1. Production activities

o Mobilization of target beneficiaries (Smallholder farmer groups)

o Access to production inputs and capital (UNADA)



o Extension services (NAADS & DPO)

o Groups strengthening (Africa2000Network)

o

2. Processing and value addition (RPBM-Corporate Entity)

o Post harvest handling

o Drying

o Milling

o Grading

o Packaging

o Storage (Warehousing)

o

3. Marketing (Rockford Harris Group & AgriNet (U) Ltd.

o Market linkages

o Warehouse receipting (Uganda Commodities Exchange)

o Transport & logistics

4. Financing (Post Bank (U) Ltd

o Access to finance and capital

o Design and management of a loan scheme

o Acumen Fund.

1.2 Product / Service

Services:

Warehousing services

Agro-processing

Grain Purchase from farmers

Enterprise capacity & business development

Product:

Product development

Brand development, Marketing & Distribution

The long term business plan is building a distinctive brand of rice. It is a product that we envision

in the short and long term. Developing this brand is our long term vision while empowering the

primary producers, the smallholder farmers through services stated above. It will be affordable

relative to other existing brands based on our business model. It will be packaged for both bulk

purchase and small off shelf-units starting with 1.0 kg to 50kgs with clear inscriptions identifying

the brand. The 1Kg, 2kg, 5kg up to 10kg packs will be to facilitate ease of domestic shopping for

home consumption. The 20 & 50kg packs will be for bulk and contract supplies to corporate and

public clients such as World Food Program, Public Institutions, and UN Missions etc.

Because we are not investing directly in production, our cost of product development shall motivate

the emergency of an affordable brand for a whole range of customers. Our business plan is to invest

in modern hulling and sorting units that grade, sort and package our unique brand. The value will

be in quality for market satisfaction.

Finally, our distribution channels will be varied and broad as we build strategic partnerships with

the business community through unique franchise models. This will make access to our product not

only affordable but physically accessible by our customers.



1.3 Market structure and analysis

1.3.1 Target market and customer base

Uganda’s population is growing at a rate of 3.7% which is among the highest in the world. The price

of food like all the other commodities in Uganda has sky-rocketed due to the suction effect of

regional markets such as Southern Sudan, Rwanda and Eastern Congo. The global food market

supply chain has been distorted causing traditional exporters such as India and Pakistan to put cap

on their export to support their local food demands. Rice production in Uganda has increased from

50,000 to 170,000 tonnes per annum. This has made the country reduce rice imports from 60,000

metric tones in 2005 to 35,000 tonnes in 2007, saving about $30m in the process and improving food

security. However, Uganda’s national market still obtains $30M worth of rice from imports. This is

because there is growing demand not only with in the local but regional market too. Uganda’s local

market alone still exports $30m(foreign exchange) in importing more than 35,000 tonnes of rice a

consequence of low productions levels, poor harvesting technologies, poor quality of agro-

processings technologies, poor storage facilities for future seasonal demand etc. The average price

of a unit of rice has gone up as a result of increased demand from the regional market putting

pressure on more production as well as importing to meet the increasing demand.

RPBM Potential Customers.

Hotels

Schools

Regional military & police institutions

Domestic consumers

World Food Program

Referral Hospitals

Members/families of the diplomatic corps

UN Mission in Congo & Sudan

Rwanda & Burundi

We are focusing on both the local and the regional market. The average economic growth rate of

6.5% in the last two decades has created an emerging middle class that shop from retail chain stores

& super-markets. This market is distributed in urban centres around the country. There is a growing

market from foreign investors in the economy and members of the diplomatic corps and an emerging

sizeable young middle class in the country and the region. The market distribution is visible around

the region. We are talking about a regional market of approximately 120 million people.

1.3.2 Market size and potential.

The general market outlook, Uganda’s domestic market demand stands at slightly more than

200,000 tonnes a year. Production stands at 170,000 tonnes a year. Making a short fall in the

domestic market alone of more than 30,000 tonnes a year that is covered by an import bill worth

$30M. RPBM wishes to improve production and efficiency and tap into the $30m import market in

addition to expanding into the regional market import needs. The regional market is also creating a

suction effect on produce in the national market shifting the market price of a unit of rice and other

foodstuffs up.Uganda’s local market alone is approximately 30 million. The regional market stands

at more than 90 million people with a demand potential of approximately 700,000 tonnes a year .

Each of the regional countries are expriencing population growth, global warming effects impacting



on agricultural output and food demands. With an average economic growth of 6.5% and

population growth of an average of 3.2% in the region, we see an emerging market potential for our

product.

Our Market Estimates for the year 2020. Our growth estimates stand at 10% of the initial production

capacity of 5000MT a year.5000MT is 2.5% of the market target we are looking at in the initial year

of production. Below are estimates from our potential market segment in the entire region.

World Food Program (1,000MT)

UN Missions in Southern Sudan & DR.Congo (1,000MT)

Public Institutions such as schools,police, hospitals and the military (1,000MT)

Domestic consumers (1,000MT)

Regional franchise exporters (1,000MT)

Our initial output is estimated at 5,000 tones in 2010 which represents approximately 2.5% of the

domestic market. Note these 5000MT are based on the base production demand of the local market

but will be regionally distributed. The market structure currently is constrained by production

investment costs as manifested by the national import bill for rice. RPBM’s modest target of 2.5%

of the domestic market as a base spread over the region will provide the business the required energy

for expansion at an average of (500MT+/5000MT of 100) making a realistic growth rate of 10%+ a

year.

1.3.3 Competitor analysis

Kibimba, a rice estate famed for its Tilda rice brand, is one of Uganda’s leading rice growing estates.

Tilda currently produces 20,000 metric tonnes of rice per year, accounting for about 10 % of the

domestic market.It is a well established corporation that is engaged in crop production,value

addition, branding and distribution. Tilda is an extensive business that takes advantage of

economies of scale with combined harvesters, product development lines and distributions channels.

It is engaged in mechanized forms of production, post-harvest handling and product development.

It has an established distribution system of its product and brand. Tilda Brand is widely distributed

in the market through franchise distrubition points. It is a high quality brand that targets a high

class niche of the market reason its unit shelf price stands at $2.5/kg. In otherwords it has curved

out its niche. 90% of the market is shared by rudimentary millers and the imported commodity. It

is from this 90% that we anticipate to break in first. Competition with Tilda will be on price and

quality and the capacity to market and distribute our brand. RPBM will have leverage on price

because our entry point is not on the production level of the value chain.

While Tilda has a business model that addreses a certain market segment demand for a quality

product,the supply can’t meet the demand reason the domestic import of rice costing Uganda more

than $30m. This has given rise to small supply chain actors;the small processors who distort the

value-chain due to ineficiency .The existence of this cohort of the value and commodity chain actors

explains the existence of gaps for our market entry. Demographic expansion by default expands

market opportunities in the region too.

Tilda’s Headquarters are based 80kms from the focus area of RPBM. While Tilda is a robust

business entity in the industrial terms, it does not answers all the questions to the domestic and the

regional food demands that is increasing every year given the disruption of the global food supply

chain. RPBM will not compete with the smallholder farmers but rather form a cooperative business

partnership with them to meet the primary production side of the value chain, a responsibility they

are already doing.



RPBM model makes entry into the market low. It does not have to worry about production costs

but product development, marketing and distribution. RPBM jumps in at a strategic level of the

value chain contrary to Tilda’s whole value chain range engagement. RPBM by default spreads

social economic benefits and a sense of ownership thus stimulating the business and enterprise

enviroment as potential for downstream business emerges.

1.3.4 Competitive advantage

Social entrepreneurship as a concept. Our primary partners will be the smallholder farmers through

the various farmers’ forum we have set up. Our long term goal is developing a rice brand that will

be uniquely identifiable by the market. RPBM as a cooperative business model will have farmers at

core of its business as producers. We will promote production through farmers rather than directly

engage in production lowering our entry costs. Our product will be legally registered with a logo, our

corporate mission statement clearly identifying our unique product with the industry regulators.

Our unique selling points will be the level of quality and product price, the packaging of our product

and the depth of distribution of our product through innovative franchise models.

The risks of our competitor will be remediated by constantly reviewing market dynamics,

innovation in our product development lines, quality and affordability of our product to our

customers and finally adherence to our social entrepreneurship concept of community building. This

concept is about building business and social relationships in the community in which we run our

business.

1.4 Marketing and distribution

1.4.1 Marketing & Communication

Marketing & Distribution Strategy.

Community Radio

Print media & electronic media

Internet Marketing-electronic commerce & e-news letters

Flyers & Inscription on product packages

Publications

Bill Boards

Network marketing concept.

Logistics & transport, outsourcing transport, franchising distribution & sales points etc.

1.4.2 Distribution.

Rockford Harris Group was registered in 2007 as a Non Governmental Organization in agribusiness

enterprise development. It has conducted both research and consulting work for the National

Agricultural Advisory Services (NAADS) and other international organizations. This Business Plan

is based on research on business opportunities in the rice value and commodity.

Rockford Harris Group will employ the following distributions points.

Franchise focal points



Whole sale and retail outlets

Setting up of Regional distribution points

Retail chains stores/super market partnerships

Commission agents

Contractual/Tender supplies

1.4.3 Sales

Our ambitious upper limit sale targets in 2014 is 5,000 tones which represents 2.5% of the domestic

demand. We anticipate a 10% growth rate of our initial year of production capacity for our facility

over a period of 3 years. Our strategic partnership with the National Agricultural Advisory Services

and other private sector actors in the value-chain will create incentives for increased production for

Smallholder farmers as well as boost our product output and supply chain to our target market in

the immdiate and long term.

Our market share target is approximately 2.5% of the domestic market(spread over the region) in

the short term which we anticipate to grow by 10% of the first year production capacity over the

next 3 years. Remember we are talking about a domestic market acounting for approximately

200,000 metric tones and a regional market of approximately 700,000 metric tonnes.

1.5 Production process & development

The project proposed herein focuses on implementing an integrated market oriented, sector specific, public-private intervention aimed at introduction of a Modern Paddy Maize and Rice Drying & Milling Equipment and Warehouse receipt services . This package resolves many of the constraints to financing agricultural sector and the associated agricultural production and marketing challenges because the product (crop) is financed only after production, product is self-collateralizing and the loan terms are normally short. Access to warehouse receipts encourages production and productivity because opportunities for greater revenue (through temporal storage) become realistic to producers and cash in hand from receipts directly finances production at no risk to the lender. Farmers will have access Modern Paddy Drying Maize & Rice Milling Equipment and warehouse receipt services.

Smallholder Farmers through a cooperative will be the primary commodity producers

A modern paddy drying & Milling Plant will be set up by company.

Warehouses for bulking,grading of produce and product storage will be set up.

Farmers near the plan will deliver produce for processing while company will collect produce at central points to the plant for processing.

Partnerships with the Uganda Commodities Exchange & Post Bank for clearance of warehouse reciepts.

Provide warehouse reciepts to farmers for clearance by Post Bank.

The company through its warehouse infrastructure and human resource will grade,sort, brand and package the rice based on target market segment.

Through our chain of distribution will transport the product to its outlets



1.6 The suppliers and raw materials

Activity/project component Project partner Type of partner

Ensuring adequate production

volumes to cover fixed collateral

management costs

Focus Youth Dev’t

Association

Public

Quality control of the

commodity

Cereal and Pulse EA Private

Overall Partnership

Coordination & Business

Development

Rockford Harris Group Public

Sound warehouse facilities Focus Youth Dev’t

Association

Public

Reliable market to off take the

commodity

AgriNet Uganda Ltd Private

Building trust and confidence

with producer associations and

other partners

NAADS Farmer For a and

AgriNet Uganda Ltd

Public and Private

Provision of an efficient banking

system to discount receipts

Uganda Commodity

Exchange and Post Bank

Uganda Ltd

Private

1.7.3 Partners:

Our approach is one of partnerships and establishment of business linkages and relationships

between and among value and commodity market chains. Our key partners are the smallholder

farmers and the “village companies” or enterprise groups that we have identified, whose business

capacity is being developed. Through NAADS we have conducted Agribusiness Consulting, baseline

surveys in collaboration with the district farmers’forum, Community Based Organizations(CBOs)

and development NGOs engaged in community development. This infrastructure is fertile for a

cooperative partnership for both community development and business opportunities both for the

community and the business enterprises. The business therefore, will be based on the cooperative

business model through a network of partners or value-chain actors.

Our partners such as the National Agricultural Advisory Services, a puiblic institution has given us

the critical political support. This business intervens by stimulating critical market conditions for

rural development. The District Local Governments, Uganda Commodities Exchange and the

farmers forum find this partnership critical for alleviating poverty. From a social perspective, the

ground is set for the farmers to do primary production of the produce while the company positions

itself strategically to develop a product, brands it and deliver it to the market based on sound

business statistics.

The only financial partners we are bringing on board is Post Bank. This is a public institution that

will clear warehouse reciepts. The company on reciept of produce, will issue a warehouse reciept to

a farmer that will be cleared by Post Bank. The company will be licenced by the Uganda

Commodities Exchange based on its sound warehouse infrastructure to have its warehouse reciepts

to farmers honoured by Post Bank. This business model has political support already. The produce



in the warehouse is the collateral held in trust by the company. At this point the company has the

obligation to the Bank to add value, market and distribute the product all on a commission basis

after which it pays the Bank both the Principle and the interest accrued at 10%.

All the farmer has to do is to deliver his crop for drying, milling and processing. After which its

weighed and the farmer given a reciept which he/she can present to Post Bank for the farm-gate

price equivalent.

Lastly but critical, are the shareholders or co-investors in RPBM. These are legal co-owners of the

business. They will provide that critical capital to kick start the business through infrastructural

investments that have proved to be capital intensive. Roles and responsibilities will be shared out

based on the level of shareholding.

1.8 Risks

What are the main risks of your business?

Risk Measure to counteract the risk

High interest rates on borrowing. Invest personal resources

High Initial capital intensity Frugal business model approach

Loss of property to banks/creditors Strategic and cautious rate of borrowing credit

1.9 SWOT analysis

Indicate the internal (you, your company and product’s) strengths and weaknesses. Then

indicate the external (market, consumers, economy, prices, competitors, etc.)

opportunities and threats.

STRENGTHS WEAKNESSES

Social enterprenuership

Well organized, experienced & committed

staff in agribusiness industry

Financial frugality in line with mission

objectives

Company Mgt still focussed on initial

business goals

Need for Capital intensive

Prices starting to go high

Staff composition still thin/low training

opportunity.

Limited business expansion capability

Limited financing options.

OPPORTUNITIES THREATS

Market still growing

Public Policy well aligned to business needs

Company still has internal capacity to survive

in the market

Possibility of saturation in 20 years

Public intervention in future may distort

market

1.10 Price breakdown.

Rates as of Today:

$1=2500 UGX



The cost of a high quality packaged kilogram of rice in Uganda off the shelf of a retail store is $2.2

Unit Price(Ikg) Product Level Cost in $ per unit Total Price ($)

Farm-gate Processed/Sorted 0.75 0.75

Packaging/Labour Branding/Product

Development

0.20

0.20

Transport/Distribution Supply chain to Market

Outlets

0.20

0.20

Storage Warehousing 0.20 0.20

Total Cost of a Unit up

to Brand Level

1.35 1.35

Retail Shelf Price Retail Store,Shop,Super

Market

2.2

2.2

Net Profit$/kg

(Super Branded

Product)

After shelf 0.85 0.85

We consider the farm-gate price as the cost of a unit of rice after processing. This is a competitive

market rate for the farmer. The price a smallholder farmer would find reasonable if he invested in

transportation of his product to the nearby urban-peri-urban centre.

Investment in other value-addition points to the product including branding would bring a unit

profit margin of $0.85/kg after other costs as indicated in the table above.



3.1 Budgeting Sheet ($)

FINANCIAL PROPOSAL: Financing needs & Sources: Financial Resources needed to kick start the project of Modern Maize Drying & Processing

Equipments and warehouse receipt services (FOOD SECURITY)

Item Description/QTY Unit Price Type of Activity Amount

1. 5Maize Warehouses and 5 Processing equipments

1,500 each x 5 AND 1250 each x 2

Repairing of 5 Warehouses and Procurement of 5 Maize processing equipments for Maize processing.

100,000

2. 20,000

Training shall be regular in initial stages in order to find out which unit best suits a given woman farmer.

20,000

Training of 5000 Women Farmers in food security and Commercial Agro-trading through Marketing and value chain addition.

3. Logistics & Transport, Product Development

40,000

This category will entail Transportation and logistics supplies like Hybrid seeds for Maize

40,000

4. Training Materials: Books, Pens, Publications & Public Address systems

20,000

Guiding brochures and materials demonstrating the set of activity work plan

20,000

5.

Land and Lab our Rockford Harris shall provide specific land for training then



transferred to farmers gardens.

6. Supply of Hy-breed seeds and fertilizers to farmers

70,000

Accessing Hybreed seeds to farmers in five districts.

70,000

7 Total 250,000 250,000

2.4 References

1. Dr.Johnson Kagoye, District National Agriculture Advisory Services Coordinator, Butaleja

District P.O.Box 1 Butaleja Tel: +256-772-480674

2. Dr.Willy Were, CDC Program Specialist

P.O.Box 49 Entebbe Tel: +256-772-230-777

4. THE DEVELOPMENT IMPACT

Five (5)Maize growing districts in Cental Uganda will be covered by the project namely Luwero,

Nakaseke, Nakasongola, Kayunga and Mukono. We focusing on a farming community of

approximately 300,000 farmers at household level and a total of approximately 2 million household

members as direct beneficiaries of the project in the long term. The target beneficiaries consist of

groups of smallholder rice farmers in the five districts named above that are actively engaged in rice

growing. Special interest groups such as out of school youth and active women groups. The intention

is to alleviate poverty among this category of the population through provision of market

opportunities and business skills development in agribusiness.

Increasing household incomes in rural Uganda translates into increased productivity. The threat of

food insecurity in the country is not because there is no capacity to produce. It is purely about

distrubution. One region is good at rice growing while another is good at diary farming.

Commercializing these value chainsb means facilitating each community to afford what it does not

produce through building distribution channels, market access intervention as well as value-

addition.

Rockford Harris Group in the short term views its social mission as more critical. It identifies

community development as a long term strategy to build its business foundation in the community

as partners. Mid-term we view our strategy as a contributor to the national tax base through

stimulation of community productivity, employment as well as a robust business case with sound

profit margins. Job creation is certainly one way we can increase not only productivity but also our



committment to building Uganda’s tax base as legitimate contributors to the economic growth of

Uganda.

4.1 Local economic impact of the business

- Number of direct employees per year (note also how many of these were previously

unemployed or earned and income below the minimum wage).

- Number of indirect jobs created or income increased (e.g. employment spin offs of your

business for suppliers and buyers, distributors, sales)

Five (5) Maize growing districts in Central Uganda will be covered by the project namely . We are

focusing on a farming community of approximately 300,000 farmers at household level and a total

of approximately 2 million household members as direct beneficiaries of the project.

Statistically, Uganda’s employment rate is low since the assumption is that 80% of Ugandans are

engaged in agriculture. Problem is 80% of Ugandans are subsistence farmers and largely poor.

Our business models answers key constraints in stimulating agriculture as a business. Through the

WRS farmers will be able to obtain fertilizers, farm inputs, input suppliers and transporters will be

active pariticipants in the food chain.The economic spin off will be an expanded hinterland by

default stimulating both markets and enteprises in various commoditiy chains.

4.2 Local social impact of the business’s products or services

- Increased access to education (knowledge & skills)

We are looking at a model that can be replicated in other value-chains such as cotton, maize, and

wheat in the region. Rural farmers lack market information. The collapse of the cooperative

movement left them fragmented since public intervention was not practical in a liberalized

economy. Given the level of competition that has seen the emergency of multinationals that take

advantage of economies of scale through mechanization and agricultural subsidies, it is imperative

social entrepreneurs revisit the agricultural sector to not only make it competitive but also profitable

to the rural farmer if we are to make them agents of their change and development.

Through our value-chain development programs, farmers will learn the importance of synergy

through membership in farmer associations as business enterprises or village companies in this

particular value-chain. Our skills development program will entail a package that facilitates a

smallholder farmer commercialize his/her activity in agriculture as a business through enterprise

development.

Through our approach of public-private partnerships, we shall adopt the warehouse receipt system

(WRS) that will facilitate access to collective storage, quality and credit from banking institutions

by farmers.

Direct access to market through our Market Access Company Model will reduce cost of doing

business in Luwero. Increased incomes, will act as a motivator for increased production both for

domestic consumption and for commercial activities. Increased incomes mean reduction in domestic

violence, food insecurity and ability to afford access to education and health.

Maize production by Women in the rural areas of Wakiso and Luwero

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Transcript of Maize production by Women in the rural areas of Wakiso and Luwero