Business idea agricultural farm

BUSINESS DEVELOPMENT PLAN
By Tanguy Monfred ZOUNGANI

MASTER IN BUSINESS AND ADMINISTRATION
BUSINESS
DEVELOPMENT PLAN
Name: ZOUNGANI Tanguy Monfred
Registration Number: 30FBNAPI814
Supervisor: Rekha HATKANAGALEKAR
Academic year: April 2015- June 2016

TABLE OF CONTENTS
Executive Summary .................. Erreur ! Signet non défini.
Chapter 1........................... Erreur ! Signet non défini.
BUSINESS IDEA ............................................................ 8
Overview of the State of Agriculture in Africa........................................................................... 8
The Case of Congo – The Market Opportunity........................................................................... 8
Crops to be produced............................................................................................................... 9
Animal’s reared ..................................................................................................................... 10
Business Objectives ............................................................................................................... 10
Structure of the Report .............................................................................................................. 10
Business Opportunity................................................................................................................ 12
Climate of Congo ...................................................................................................................... 12
Location of Farm....................................................................................................................... 12
Opportunities for Selected Crops to be grown ...................................................................... 13
Animals Raised...................................................................................................................... 13
Growth Expectation............................................................................................................... 14
Feasibility ................................................................ 15
Research Methodology.............................................................................................................. 15
Chosen Paradigm....................................................................................................................... 15
Market Feasibility ..................................................................................................................... 15
Market Analysis..................................................................................................................... 16
Risks to Consider................................................................................................................... 22

Aggregate Demand................................................................................................................ 17
Food Trade in Republic of Congo......................................................................................... 18
Environmental and Industry Feasibility.................................................................................... 19
PEST Analysis....................................................................................................................... 19
Industry Competitiveness.......................................................................................................... 22
Porter’s 5 forces..................................................................................................................... 22
Organizational Feasibility ......................................................................................................... 24
Description of the Business Structure ................................................................................... 24
Internal Principles.................................................................................................................. 25
External Principles................................................................................................................ 26
Professional Skills and Resumes ........................................................................................... 26
Financial Feasibility.................................................................................................................. 26
Projection of Expenditure...................................................................................................... 26
Sales/ Revenues Expectations ............................................................................................... 27
Break – Even.......................................................................................................................... 27
Projected Income Statement of Tanguy Farms...................................................................... 29
Projected Balance Sheet for Tanguy Farms .......................................................................... 29
Strategic Applications and Approaches ......................................... 29
SWOT Analysis..................................................................................................................... 29
TOW Matrix .......................................................................................................................... 30
Value Chain Analysis ............................................................................................................ 31
Porters Generic ...................................................................................................................... 34
Ansoff Matrix ........................................................................................................................ 35
CAGE Framework................................................................................................................. 36
Business Canvas Model......................................................................................................... 37
Chapter 5................................................................. 38
Business Plan ............................................................. 38

Overview of Tanguy Farms................................................................................................... 38
Ownership of Tanguy Farms................................................................................................. 39
Legal Registration of Tanguy Farms..................................................................................... 40
Value Proposition .................................................................................................................. 40
Marketing Plan ...................................................................................................................... 41
Market Segmentation............................................................................................................. 41
Market Targeting ................................................................................................................... 42
Positioning............................................................................................................................. 42
Marketing Mix....................................................................................................................... 43
Operational and Organizational Plan..................................................................................... 44
Location................................................................................................................................. 45
Supply Chain Management ................................................................................................... 46
Financial Plan ........................................................................................................................ 47
Cash Flow Statement............................................................................................................. 48
Net Present Value .................................................................................................................. 49
Business Schedule ................................................................................................................. 50
Risk Analysis......................................................................................................................... 51
Contingency Strategies to deal with risks.............................................................................. 52
Alternative Business Idea ...................................................................................................... 52
References................................................................ 53
Appendices ............................................................... 56

This is a business development plan which details the setting up of an agricultural farm in the
Republic of Congo. Whiles many countries in Africa have been able to make use of the vast farm
lands and conditions that support agricultural growth and production. The republic of Congo is
one of the very few exceptions with the country highly dependent on imported food crops for
domestic consumption. The lands in Congo, though suitable for agriculture are hardly used for this
purpose, due to a combination of factors, such as lack of expertize in the field and the lucrative
returns that oil production offers to investors in the country. Based on this gap, Tanguy Farms is
set up to be the first commercial Farm business in the country, which will focus on the production
of staple crops for domestic consumption.
The business plan will present the market opportunities, in terms of demand and supply, based on
secondary data collected from the Ministry of Agriculture and the Food and Agriculture
Organization of the United Nations. The plan gives a complete description of how the market
opportunities will be pursued.
To begin with, the first chapter of the business plan presents a brief of the current situation in the
Republic of Congo, where agriculture is simply in non – existence. The high revenues obtained
from the oil production, which contributes to 85% of the GDP of the country, has been enough to
sustain the country, hence the huge under – development of agriculture. However, as world fuel
prices have been fluctuating, the revenue stream of oil production in the Republic of Congo has
likewise reduced, leading to agriculture emerging as an alternative investment source. The
Government of the Republic of Congo has making arable land available to potential investors
through long term leasing and this is perhaps one of the biggest opportunities available in this
industry. To take advantage of this opportunity, the third chapter presents an in – depth feasibility
study, where the current quantity of imported food, as well as the daily consumption per unit
calories in Congo are identified. A feasibility study in the economy of the Republic of Congo
shows a positive growth rate over the last decade, which increases the per capita GDP of the
people. This implies that they do have the spending power to purchase food crops, which is a
necessity. The document also presents application of strategies to take advantage of the
EXECUTIVE SUMMARY

opportunity and enhance growth, such as a SWOT/TOWS analysis, Value Chain, Ansoff Matrix,
etc
BUSINESS IDEA
Overview of the State of Agriculture in Africa
Agriculture has been the source of national income for most countries in Africa. More than 75%
of the 52 countries in Africa are purely dependent on Agriculture for exports (UN, 2014). The
reason why this is so can be supported by the fact that the continent itself generally enjoys
moderate rain, with a precipitation rate that is between 2.5 mm (0.098 in) - 7.6 mm (0.30 in) or 10
mm (0.39 in) per hour (Radebe, 2011). Since crop production is also dependent on sunlight, which
provide the warmth needed for photosynthesis, an average temperature of 33.9 °C experienced by
African countries provides the grounds for rapid expansion in Agriculture at the expense of
industrialization. This is no doubt the reason why many African countries have turned to the
development of Agriculture as the tool for facilitating growth of the individual countries in the
continent. With support from the United Nations, there have been several programs such as the
Alliance for Green Revolution in Africa (AGRA), Agricultural Policy Guide to Sustainable
Development, Food Security and Agricultural Development in Agriculture and the Policy of
Achieving Middle Income Status through the Agriculture in Vision 2020 Millennium
Development Goals (UNDP, 2012). All these are polices that are development in accordance with
African countries to increase the growth of Agriculture in the continent
The Case of Congo – The Market Opportunity
Not all countries in Africa have been successful in Agriculture though. According to African
Rankings (2016) largest economies of Africa, of the 20 countries that were listed, only two were
agriculture dependent. Going by the information above non – agricultural dependency of Congo
should not put the country in any danger since Congo has other major forms of export, particularly
oil. The issue however, is not the non –dependence on agriculture for export, but rather the absence
of Agriculture. With summer conditions that has temperature averaging 31 Degrees Celsius and
precipitation of 0 %, to rainy season’s precipitation is within 6%, Congo has the ideal conditions
that can enable the inhabitants enter into commercial agriculture (Butler, 2013).
CHAPTER ONE

However, whiles the country’s export from Agriculture is almost insignificant, it is further more
disturbing when it comes to the realization that much Agricultural produce, consumed
domestically in Congo are imported from other African countries.
In order to take advantage of the presence of arable land, access to labor, favorable weather
conditions and high aggregate demand, Tanguy Farms will be an establishment which will be
producing agriculture crops as well as animal husbandry. The objective of the company will not
be export the produce but rather to meet the local demand that they have. In the next years, the
success of this business venture will propel management to fancy the idea of Market development,
through exporting our produce into other countries.
Crops to be produced
On evidence of the quantity of crops produced in Congo, as well as the domestic consumption and
demand, four crops have been selected to be the main crops that will be grown in Tanguy Farms.
The main crops that will be grown in the initial years are Cassava, tomatoes, maize and Oil Palm.
An elaboration on the basis for which these crops are selected for initial production will be
explained in the second chapter of this document, under market opportunities
Cassava Tomatoes
Oil Palm Potatoes

Animal’s reared
Also already noted, Agriculture is both about crop production and animal husbandry. Tanguy
farms will therefore indulge in both to bring value to the populace. In the beginning though,
Tanguy Farms will focus on pig production to supplement the crops produced. In the years ahead,
Tanguy Farms will add cattle rearing to the animals raised
Business Objectives
The following are the objectives upon which Tanguy Farms is being established
✓ To bring innovation into the agricultural industry, which currently is under producing
adequate food supply for the people of Congo
✓ To become the pioneer of creating a unique model of self-sufficiency in agriculture,
thereby empowering other small scale farmers to grow in the industry and reduce the
dependence on imports
✓ To achieve a 15% growth in annual production of crops of meat, enough to engage in
exports into neighboring countries with 6 years of operations
Structure of the Report
Synopsis of Chapter 1
This report is structured into five chapters. The first chapter of the report is contains a general
introduction of agricultural, first in the continent of Africa, before the focus is placed on the
Republic of Congo. This chapter will also provide a brief of the company, crops to be grown and
the animals to be raised.

The second chapter focuses on the development of the business concept, brought about by the
business opportunity. Among the opportunities identified will be the nature of the climate and land
available, as well as the production and importation of the crops to be grown
The third chapter is a comprehensive feasibility test, which covers the market feasibility,
environment and industry, organization and financial feasibility of Tanguy Farms. Financial
statements are forecasted for a five year period
Strategic application of models is the focus in this chapter. Using models such as Value Chain,
Matching model and Ansoff Matrix, the capabilities, HR approaches and Growth options of
Tanguy Farms are strategized.
This is the concluding chapter in the is business development plan and provides an outlook of how
the business is going to be carried, It includes a marketing and operational plan, as well as possible
risks and contingencies approaches to the business.

BUSINESS OPPORTUNITY
This chapter focuses on the current opportunities that are in the country, which increases the
propensity and probability of this business to be successful. The first aspect that is going to be
considered is the climate of Congo
Climate of Congo
The Republic of Congo is bordered by Gabon, Congo DR, Angola, Central African Republic and
Cameroun. Of the five neighboring countries, only Cameroun has a well - functioning agricultural
system meaning that the other four countries represent huge attraction to export when the business
grows.
The republic of Congo covers a total area of 342,000 km², of which 341,500 km² is land, while
500 km² is water (Nkoudi, 2007). Congo has a tropical climate and rivers that flood seasonally,
this means that there is availability of water even in dry seasons. Up to 70% of the land of Congo
is covered by rain forest. However, a research carried by Bora said that only about 20% of the land
of Congo is arable (Nkoudi, 2007a).
Whiles the low percentage of arable land may appear to be a threat, it actually is an opportunity
nevertheless. This is because the 20% arable land actually represents 6840 km2 of arable land
(Kumah, 2013). According to Kumah (2013a) less than 10% of the arable land in Congo has been
used for farming purposes. Most of the inhabitants are gainfully employed in the oil sector, which
constitutes 92% of the total exports of Congo. Also, Congo is the only country in the world that
has a highest proportion of the population living in the capital. Even though Congo is a small
country of merely 4 million people, 70% of the population is inhabited in the Capital Brazzaville.
Areas of arable land, such as Likouala and Sangha are very sparsely populated.
Location of Farm
80% of the arable land in Congo is found in Likouala which is also the most sparsely populated
region in Congo (Climate data, 2008). There is lack of innovation to enter into agriculture because
CHAPTER TWO

even though the land is arable, it is not quite developed for commercial agriculture (See Picture of
site proposed in Appendices 2)
Opportunities for Selected Crops to be grown
Cassava: A very high source of carbohydrates, cassava is one of the most consumed crops in
Congo. This is because of Congo’s local dishes, Manioc is prepared with cassava. Other meals
known to be prepared and consumed along with cassava in Congo are Fufu and Kwanga. However,
domestic production of cassava in the Republic of Congo is less than 100 tons all year. Cassava in
imported from neighboring Democratic Republic of Congo
Potatoes: Despite being a high source of calories, potatoes are also very rich in Vitamin C,
potassium and iron. Just like cassava, potatoes are also a staple food in Congo. Most often, they
are boiled and consumed with vegetable sauce. Potatoes are either boiled or fried. Even though
there is high demand for potatoes, none is grown is Congo, with up to 50,000 tons being imported
from Rwanda each year (Nana, 2013).
Tomatoes: Also called the red vegetable, tomatoes are the most common vegetable used in Congo
because of its diversity. In other words, it is almost ever present in many of the many of the foods
that are prepared in Congo. Tomatoes are very rich in lycopene. They also lower the cholesterol
content in the body. Tomatoes are imported from Cameroun
Oil Palm: Oil palm nut are grinded and from them they are used to prepare soup called palm nut
soup. They are very rich in Vitamins K and E. The soup prepared can be consumed with Fufu
which is a staple meal. Palm nuts are also imported from Congo, with an average of 60,000 tons
being imported each year (Nana, 2013a)
Animals Raised
Pigs are very nutritious meat, very rich in protein. The downside of pig production in most places
is because of religious reasons, due to the fact that Muslims do not consume pork. However, Congo
is a country that has a Muslim population of only 1.6% (Demography of Congo, 2015). This has
made is the most consumed meat in Congo but like many of the other agricultural produce are
imported.

0
500
1000
1500
1 2 3
Pigs
Pigs
Growth Expectation
All the crops (with the exception of tomatoes) selected, if the done organically, is expected to reach
full maturity within 12 months. As a start – up, Tanguy farms expects to harvest 15,000 tons in the
first year. The company has the expectation to increase its production by 15%
Tomatoes will be harvested bi – annually. This is because it has a relatively faster growth and
harvest period. Tomatoes also require lesser land since a single tree can have several tomatoes
grown on it. Each harvest is expected to produce 20,000 tons of tomatoes and for this reason;
40,000 tons of tomatoes can be harvested each year with a growth rate of 15% per annum. Maturity
of the pigs will take a year. 800 pigs are expected to be sold during the first year with 15% growth.
0
20000
40000
60000
80000
100000
1 2 3
Crop Production
Crop Production

FEASIBILITY
This is a chapter which is focused on making a feasibility study in the Republic of Congo, on the
capacity of Tanguy Farms to be set up. In simple terms Dick (2003) defines feasibility as the
process of assessing the practicality of the business that is being proposed. The chapter will focus
market analysis of the Republic of Congo, industry and environment, organization and also
finance. Below is the research methodology that will be employed for this work.
Research Methodology
Chosen Paradigm
The paradigm refers to the approach of the research. This is a business development plan that is
proposing the setting up of a commercial farm in the Republic of Congo. For this reason the
positive approach to research is used, where the information obtained and used for this research is
not one which is compromised
Data Collection and Validity
Secondary data is used for this research. This is a method chosen due to the fact that the researcher
is currently not in the country in which the business is being proposed. In order to avoid biased
information, credible secondary sources from the Ministry of Agriculture of the Republic of
Congo, Ministry of Trade and Commerce, World Bank Report and UNDP are used for this
research. Even though these are credible sources, information will be triangulated to ensure that
there are validated
Limitation
One of the major limitations of this research is that it is solely dependent on secondary sources of
information. Even though the sources chosen are credible, they are not often current, due to the
lack of logistics and infrastructure in Africa. The absence of primary research methods in this
project further implies that there are very limited means of validating data obtained.
Market Feasibility
Market feasibility is used to bring out the depth and the condition of the market, in order to
understand what the requirements for success in the market are.
CHAPTER THREE

Market Analysis
The Republic of Congo is the 34th
largest producer of oil in in the world and up through oil, the
country generates up to 85% income of the Gross Domestic Product. Declining world prices of Oil
has led to investors entertaining the idea of diversifying their incomes (Safi, 2013). Even though
there is centrality in hydrocarbons, there fall in prices, coupled with emergence of new discoveries
of oil in different countries cause of consternation in many oil-producing nations of which the
World Bank Report (2013) echoes as one of the Republic of Congo’s major concern.
The World Bank (2013) in their progressive policies highlighted Congo’s untapped agricultural
sector as having the capacity to be a source of sustainable and lucrative venture, which will
compensate the drops in oil – generated revenues. Congo has 10 million hectares of arable land
that can be utilized for agriculture but till date, only 10% is used, which contributes to merely 3.3%
of the GDP of Congo. The World Bank (2013a) states that the conditions of the climate and soil,
makes the country well placed to produce crops such as cassava, sugarcane, potatoes, cocoa, oil
palm, tomatoes and other forestry products.
Even though almost have of the population’s working force are employed in this sector, local
farmers do not have access to modern farming technologies and one of the main reasons for this
has been as a result of the closure of state companies in Congo, such as Staple Crops Office and
Office of Cocoa and Coffee which were in charge of marketing farmers' produce.
In Congo, there is the rise of traditional family farming, which in 2010, accounted for roughly
140,000 farms which is about 80% of the cultivated farm lands (Ogo, 2014). These are poorly
supported though. Civil was in the 1990’s reduced greatly expenditure on research and
development by Government to increase agriculture in the country. Donor countries subsequently
reduced their support towards agriculture in Congo. After the period of 1999, research and
development in agriculture has increased marginally, even though it still remains below the levels
prior to the wars. The Republic of Congo invested 1.2 billion CFA francs towards R&D (Ministry
of Food & Agriculture, 2014)

Country
profile
Agricultural
Land
Population
Estimate
Economy Poverty Gender
Congo 10.56 million 4.45 million 3.30% 54.10% 0.61
31% of country
land area (34.15
million)
10.6 million
by 2050
Share of
Agriculture GNI
per Capita $2,550
Population
living less than
$1.25 MPI:
0:534 (Rank
142)
Gender
inequality
5.0
Births/woman
Rank of Doing
Business (out of
186):185
Aggregate Demand
Food is a necessity product that has inelastic demand. Since most of the staple foods in the
Republic of Congo are prepared using the chosen crops, which is cassava, oil palm etc. primary
research conducted by UNDP (2013) showed the individual consumption of food stuff among 18
selected countries in sub – Sahara Africa.
The food consumption is expressed in kilocalories per capita each day and has been used as an
ideal determinant of measuring the evolution of the regional food situation (FAO, 2003). This can
also be expressed as the national average apparent food consumption, due to the fact that the data

used is obtained from the national Food Balance Sheet of the Republic of Congo, rather than
consumption surveys.
The above table shows that aggregate demand and consumption of food in the Republic of Congo
average 1954.06 kilocalories per capita per day. However, between 1981 and 1991, spanning a ten
year period, the consumption significantly dropped. This has been called the dark years of Congo
which was marred by Economic crises, stemming from civil wars fought between political parties
for power.
Since domestic production was not – existent, the war cause imports to reduce as well bringing
consumption to an all-time low. Also, this period was marred by thousands of deaths. At the turn
of new millennium however, the consumption per calories increased by 616.34. This was as a
result of political stability and positive population growth. The positive population growth rate has
(3.7%) been a key determinant of consumption in the country as current consumption per
kilocalories is recorded as 2731.53. The continuous increase has not only shown greater demand
for food crops and meat, but has also put pressure on government to increase importation. Since
2010 imports of oil palm, cassava, potatoes, pork and tomatoes have averaged 18% (Appendices
3 shows the quantity of oil palm, cassava, potatoes, tomatoes and pork imported into the Republic
of Congo over a 6 year period)
Food Trade in Republic of Congo
One of the best measures to measure demand for food is to use the ratio of food trade. Food trade
refers to the degree of imports and exports of the country (FAO, 2003). A trade gap may be positive
of negative, depending on whether the volume of food exports exceeds that of imports of vice –
versa. In making this analysis, excess a deficit occurs when food imports exceeds that of exports
and this shows that the country is less dependent on imported foodstuff.
Location 1961-1971 1971-1981 1981-1991 1991-2001 2001-2007 2007 - 2015
Rep. of Congo 1909.03 1990.55 1702.76 2319.1 2444.76 2731.53
Total food consumption (kcal/capita/day)

The above diagram shows a huge gap between import and export of agricultureal products. From
the period of 2000 up until 2013, exports of agricultural was almost non – existent, with the country
constatntly depending on imports, to meet demand. Sligh increase in exports was in cocoa
production in 2015. However, demand and dependence for staple crops is still signifantly high
Environmental and Industry Feasibility
PEST Analysis
This model is used to bring out the macro environmental conditions affecting the business.
According to Pandey (2011), it is fundamental for deriving the impact that external factors have
on the organization and is used as a strategic analytical technique. The model was framed by
Aguilar (1967) when he found Economic, Technology, Political and Social (ETPS) as the main
environmental factors for scanning the environment.
Political
The Republic of Congo is credited to be one of the largest producers of oil in Africa. However, the
same cannot be said when it comes to agriculture, especially in crop production and animal
husbandry. The economy is simply not diversified enough with the large chunk of the country’s
national output coming from oil production. According to Africa Economic Outlook (2013) the
highly underperforming agriculture sector of Congo employs 43% of the population though it must

be said that most of them are into aquaculture (fish farming). In 2008, out of 178 countries listed
on World Bank’s Ease of Doing Business, Congo was placed at 175. In 2015, the country climbed
2 places up to 176th
, out of 198 countries (World Bank Group, 2016). Until policy measures in
2011 to encourage Agriculture, Government’s means of reducing poverty has been heavy
importation of agricultural produce, which in 2012 was recorded at 90%. External shocks in
continental agricultural prices lead to price fluctuations in the country. The following are
governing regulations:
• Regulations to safeguard the environment upon which farming is done
• Regulations towards agriculture aid installations as well as infrastructure selected by the
Ministry of Agriculture
• Setting of tax structure on agriculture produce
These are only a few highlights of the Republic of Congo Law No. 2 – 2000 on Agriculture. The
Government has also entered into partnerships with investors to increase the quantity of
agricultural activity, by giving long term lease of lands to them.
Economic
Even though Oil is by far the main contributor to GDP, the revenues have not matched the
expectations because the Government has mortgaged a substantial portion of the petroleum
earnings. In the past the republic of Congo has dealt with high levels of inflation, with a
devaluation of the Congolese Franc in 1994 leading to 46% inflation (Trading Economics, 2014).
However, this has improved with figures from 2015 showing that inflation rate is 3.70%. It does
not appear that the Agriculture potential in Congo will be tapped anytime soon. This is because
the less than 2% of the arable land in use is as a result of the fact that apart from petroleum, Congo
has a large deposit of untapped minerals such as diamond and gold. Currently, Agriculture only
contributes to 3.5% of the GDP of Congo (Min. of Agriculture, 2014). Congo has a 2016 GDP of
9.769 billion and a per capita income of $2,165 (Mosely, 2015). The GDP growth rate in 2015 was
6% and it is expected to be 7.5% at the end of 2016

Population 4.6 million
GDP per Capita $2,190
GDP Composition by Sector Agriculture – 5
Industry – 60
Services – 35
GDP growth rate (%) 6%
% below poverty line 42.3
Inflation 3.78%
GNI Index 47.3
Life Expectancy 54
HIV prevalence 3.5
Overseas Development aid per capita 34
Net official Development assistance (2015) 129
2015 HDI Ranking 136
Social
With an urbanization rate of 70%, Kanto (2013) recalls Congo as one of the most urbanized
countries in Africa. Despite being a relatively small country, Congo has a very diverse ethnicity
with up to 62 spoken languages recognized in the country. However, these can be grouped into
three main categories, which are the Kongo, the Teke and the Boulangui. Across these ethnicities,
cassava is the most common food among them. Pig consumption is also very high in Congo,
because of the small Islamic population (1.6%). Agriculture importers and farmers target
Brazzaville as the main market. This is because of the 4 million population of Congo; 1.3 million
reside in Brazzaville, Pointe Noire and Dolsie.
Technology

Congo has experienced a lot of advancement in technology. However this technological
advancement is industry specific as the oil sector has been the most beneficiary. The technologies
in this sector have been used in subsea production and processing of petroleum. Internet
penetration in Congo in 2013 was on 2.2% though it has more than doubled in 2016. In the
agriculture sector, the most significant form of technology has been the improvement in irrigation
systems that can sustain local famers’ water for crops and livestock during dry seasons.
Risks to Consider
Even though the Republic of Congo has been putting measures to court international investment,
there are several challenges that it presents to investors. Infrastructure in the country remains
highly under-developed. This includes erratic supply of power, lack of adequate roads connecting
agricultural lands to major cities, among others. Mismanagement and corruption has also been a
contributor to making investments in Congo relatively unattractive. There has been widespread
controversy in Congo, as a result of the growing trend of leasing agricultural lands to foreigners.
Industry Competitiveness
Porter’s 5 forces
According to Delph (2007) porter’s five forces is one of the most simple and yet the powerful
strategic models which is used to understand the source of power in a business situation. The model
effectively identifies the form of competition as well as to recognize the current competitive
position as well as the strength of the position that the company is going to move into.
Threats of Market Entry - low
This describes the difficulties that firms face in an attempt to enter into this industry. The threats
of market or industry entry may arise from many factors, such as government roles, that of
competitors among others. In the agriculture industry, threats of entry are very low. This is very
true and evidence of the fact is that less than 10% of foods consumed are prepared from crops
produced within the country (Bram, 2014). The government cannot be faulted for the lack of
interest in entering this industry. Balance of payment deficits have been as a result of heavy
importation but the main threats of entry are lack of developed lands for agriculture, and the allure
of transferring resources into the petroleum and mining sectors ahead of agriculture.

Bargaining power of Buyers - Low
The bargaining power of buyers is the lowest in the industry. This is simply because of lack of
crop production and animal husbandry. Buyers therefore do not have control over the prices that
of crops and meat that are being imported. Importers transfer the taxes paid on importation to
consumer’s final price. Because of the low bargaining power of buyers, importers have been
increasing the quantity of agricultural produce imported into the country because the low
agriculture products are necessity goods and have inelastic demand
Bargaining power of Suppliers - High
The suppliers in this industry are the few existing farmers in the country, as well as the importers
of agricultural products. Also, the suppliers will include the human capital that offers their services
for farming. The fact that there are very few farmers in Congo, engaged in crop production and
animal has increased their bargaining power. The reason is that local producers are able to sell
their farm produce comparatively cheaper than imported ones. Their produce is therefore absorbed
quickly than the imported ones. In the case of importers, their bargaining power is also high when
considering the fact that the local suppliers only offer one – tenth of aggregate demand. The human
resources that offer their inputs to production have a moderate bargaining power. This is because
this highly underperforming sector employs 46% of labor.
Threats of Substitutes - low
Agriculture products simply have no substitutes. These are crops that are needed for the livelihood
of the people of Congo and there are no substitutes for foods. There are however alternatives,
besides the crops and meat that are being produced. However they are all imported oriented such
as chicken, beef, maize, etc.
Rivalry - Low
The rivalry in this industry is very low and close to insignificant. The gap between aggregate
demand and aggregate supply is simply too much. Most of the farmers have turned to subsistence
farming because of the challenges they will face in going full – scale commercial farming.

Organizational Feasibility
Organizational feasibility studies are conducted to determine if the business proposal has
sufficient expertize in management and organizational competence. Also it focuses on the
resources which are needed to be able successfully lunch the business. The focus is one non –
financial resource. According to Wolfe (2013) the purpose of an organizational feasibility study
is to define the legal and corporate structure of the business. Again Wolfe (2013a) points out that
below should be the building blocks of an Organizational feasibility study (Refer to Chapter 5
for flow chart)
Description of the Business Structure
In the Republic of Congo, by Statue, all small scale agriculture or that which is set up for
subsistence does not need to be registered with the Registrar General of Companies. This is
because their scale of production not entirely enough to sell commercially. The government of
Congo rates farmers whose total harvest and sales within the year are less than 10 tons. The
government recognizes yearly productions above 10 tons of any of agricultural produce to be
commercially viable and is subject to registration and taxation. Since Tanguy farms is targeting up
to 60,000 tons of agricultural produce during the first year, the company as part of its
organizational feasibility will be registered. Because of the magnitude of this business, the business
Description of the Business Structure
Description of the Organizational Structure
Internal and External Principles and Practices of the Business
Professional Skills and Resumes

structure will be a partnership. Below are some of the key reasons for which a partnership is the
most feasible structure of this business:
• Registering the business as a partnership will imply that there is no need for the partner of
Tanguy Farms to pay income tax. This is because each of the members will have to find
our own personal income tax.
• This is a business which has a high degree of risk attached to it, signing up as a partnership
means that there will be a wider pool of knowledge and divestiture of skills needed
• Since there number of hectares for propagation is very wide, as well as the different number
of business units, a partnership of this company will lead to greater improvement in
management
• As partnership it will be relatively easy to attract investment
Internal Principles
Conflict of interest policy
Conflict of interests arises when some members of the organization focus on other objectives that
are external to the organization. Usually, these are personal interests which are in contradiction to
that of the organizational goals. Usually, this is aimed towards top management. In Tanguy farms,
there is the threat of conflict of interest because with low domestic production, some members or
top management may have an interest in embezzling agricultural products for their own
subsistence. A document will be prepared by the Attorney of Tanguy farms and signed by all
member of the organization before commencing work. The details of the document will be
centered on displaying loyalty and having the duty of confidentiality in the organization.
Hiring and Employee training policy
The hiring decisions in very fundamental in this business because as already stated it is a high risk
business. There are no such commercial farms in the country and so Tanguy farms must create its
own learning curve. To be effective, the best possible employees will be hired. The first
consideration will be to hire employees who already have knowledge in farming through the local
farms in Congo. This will mean that transferring of knowledge will be easier. also, the academic
qualifications of top management will focus on agriculture and administration disciplines. Job
training is important and leads to effective employee development. The strategy of Tanguy farms

is to regularly organize symposiums on the new technology to be used in Agriculture to our
employees, to make them better equipped to changes in industry operations and demand. Also,
neighboring countries such as Congo DR will be a destination where several practical training will
be conducted, due to the fact that they better agriculture systems than Republic of Congo.
External Principles
The following are the external practices and principles of Tanguy Firms:
• We do not serve clients but rather, we team up with our customers to be able to meet their
goals
• We put emphasis on innovation and creativity, to make sure that all our agricultural
produce are purely organic
• We ensure that the employees or Tanguy firms have the right attitudes and ethics to work
to meet the demand of farm produce
Professional Skills and Resumes
The human capital is the key source of strengths in this organization. Being a start –up company,
Tanguy farms will be very strict on the kinds of employees that will be brought into the firm.
Financial Feasibility
The cost of starting up this business has been estimated due to the information obtained from the
market about the land, rent and expenses related to the business. In view of this, the cost estimated
is $110,000. Of this cost, the partner’s contribution towards equity is $70,000 whiles the remaining
$40,000 will be obtained as a bank loan, representing debt. This makes the debt to 0.57, which is
acceptable in this industry.
Projection of Expenditure
The cost drivers of this business have been identified in the 5th
Chapter. The expenditure includes
the cost of land, equipment and machinery, irrigation system among others that are relevant to the
Farm set up (A Full break – down of expenditure is found in the Appendices). The estimated cost
for the first year of the Farm set up is $110,000. However, with an inflationary rate of 6.4%,
Tanguy Farms will estimate costs of the years that follow by rising each year by 10%. The Graph
below shows cost estimation for the first five years.

Sales/ Revenues Expectations
The total output of the crops and pork sold in the first year is expected to fetch Tanguy Farms
$125,000. However it is the objective of Tanguy Farms to achieve a 15% increase in each of the
years that follow. Based on this, the graph below shows a visual representation of the growth in
sales revenue
Break – Even
This is an economic metric which is used to describe the point at which the revenues received from
the business are equal to the associated costs. Using this metric, the company will be able to
identify its margin of safety
0
20000
40000
60000
80000
100000
120000
140000
160000
180000
1 2 3 4 5
Costs
0
50 000
100 000
150 000
200 000
250 000
Year 1 Year 2 Year 3 Year 4 Year 5
Série1

To calculate the point of Break – even, it is important to identify the price per unit kilogram of the
produce, the variable costs and fixed costs.
Mean price of kilogram of produce (pork, cassava, potatoes, oil palm) = 13 USD
Variable cost per unit kg – 6 USD Total Fixed Cost (Shown in Chapter 5) = 77900 USD
Contribution Margin: Price – Variable Cost (USD 13 – USD – 6) = 7 USD
Break – Even 77900 / 7 = 11129 kgs
Break – Even Sales Revenue: (11129 x 13) = USD 144,667
TR
TC
Price
BEP TVC
$13 TFC
0 11129 Kgs Kilograms
The diagram shows that the point of break – even will be attained when Tanguy Farms sells
11129kgs of produce. This will lead to revenue of USD 144,667. The Income statement shows that
the point of break – even will be after the second year of business.

Projected Income Statement of Tanguy Farms
Projected Balance Sheet for Tanguy Farms (Refer to cost drivers in chapter 5)
First Year
Second
Year
Third
Year
Fourth
Year
Fifth
Year
Current Assets
Cash 20000 21000 24000 25400 25300
Bank 22000 32000 36000 38200 42000
Total current assets 40000 40500 57000 60500 61000
Fixed Asset
Feeding & Equipment 27000 30000 51000 64000 60000
Truck 31,000 30000 17000 18000 6000
Computers 11,000 10500 12000 13000 5000
TOTAL ASSETS 110,000 124000 142000 153000 174000
Equity & liability
Bank loans 30000 30500 30500 30000 30000
Equity + Net Profit 70000 91000 105000 108000 144000
TOTAL
EQUITY&LIABILITY
110,000 124000 142000 153000 174000
STRATEGIC APPLICATIONS AND APPROACHES
SWOT Analysis
According to Cox (2006), before business decisions are made, a SWOT analysis is important for
the planning stage. This acronym which stands for the Strengths, Weaknesses, Opportunities and
Particulars Year 1 Year 2 Year 3 Year 4 Year 5
Revenues 125,000 143,750 165,312 190109 218625
Expenses 110,000 121,000 133,100 146,410 161,051
EBIT 15,000 22,750 32,212 43,699 57,574
Interest 7000 7000 7000 7000 7000
EBT 8,000 15,750 25,212 36,699 50,574
Tax (30%) 2400 4725 7563.6 11009.7 15172.2
EAT 5,600 11,025 17,648 25,689 35,402
CHAPTER FOUR

Threats is a helpful analytical framework, which aids the company to face the most significant
challenges which a promising new market can pose. The model was developed by Andrews et al
(1960).
Strengths Weakness
1. High Quality of Land
2. Employing of Indigenous farming
systems
3. Use of innovative technology
4. Access of water for riverside
situations
5. Access to technical farming
knowledge
1. Lack of secured and reliable data
about organic agriculture
2. High cost of production due to lack of
supporting infrastructure
3. Lack of employees with commercial
farming knowledge
Opportunities Threats
1. Emergence of new attitude towards
agriculture as a leading role of
National development
2. Positive Growth in the population of
Congo
3. Government support policies on
Agriculture
4. Increase in Information Technology
1. Production Risks
2. Government policies are incoherent
marred by corruption
3. High quantity of imported agricultural
produce
4. High tolerance of input prices
TOW Matrix
This matrix uses information from the SWOT analysis to discover strategies that the company can
use based on their internal capabilities and external environmental conditions (Foreman, 2006)
S-O strategies W-O Strategies

✓ Increase production through innovative
technology to meet growth in market
✓ Expand land used in crop production to
take advantage of land quality
✓ Liaison with government to import
foreign technological support
✓ Take advantage of Information
Technology to research into organic
farming
S – T Strategies W-T Strategies
✓ Increase in R&D expenditure to
counter production risks
✓ Improve irrigation systems to control
cost of resources
✓ Test marketing to quantify risk of
production
✓ Growing of crops that have high
economic value
✓ Putting in place strategic plans for the
development of organic farming
✓ Forming a partnership with the
Government to develop extension
programs that are based on the needs of
farmers.
Value Chain Analysis
This is a strategic tool which is used to perform an internal analysis of a company’s activities.
They purpose of using this model is that it will be used to recognize which activities in the
organization are valuable and a source of cost or differentiation advantage to the firm. It therefore
will provide the firm with a competitive advantage (Avery, 2013).
Inbound Logistics
Because of the lack of proper agriculture in the region, there are very few quality seeds available
to be purchased. With the exception of cassava roots that can be purchased from the Ministry of
Agriculture, those of potatoes, oil palm seeds and tomato seeds will be imported from Cameroun
from AD farms limited. Because of similarities in weather conditions in both countries, there is a
high chance that the seeds will thrive in Congo. For the pigs, the American Yorkshires breed has
the most demand in Congo. Piglets of this breed will be purchased from Darko Farms, Kenya,
renowned for their piggery

Operations
Preparation of land of the land for production will always begin in the mild temperatures of
December. In Congo, there are two main seasons which are the dry and wet season. The wet reason
is at its peak in the period of June and July. The land preparation involves pruning the weeks,
ploughing and applying organic material to make it rich. Vegetables thrive very well in soil
containing organic matter because it loosens the soil and makes the roots to have easier penetration
and spread, soils are also filled with nitrogen, potassium and phosphorus in the ration of N10, P10,
K10. They act as fertilizers to boost growth. Planting starts in March and harvest is expected by
December.
In the case of the piglets, they area vaccinated and weaned whiles the male are separated from the
females. The ratio of males to females is 1:10 and they are only brought together for crossing.
Piglets are separated from mothers do prevent them lying on them. Pigs are ready to be sold after
8 months, when they are expected to wright 75kg
Outbound Logistics
Tanguy Farms will transport the agricultural produce from the farms in Likouala to Brazzaville,
which is approximately 751 km by road. Brazzaville may be the capital but Port Noire is also a
highly urbanized city in Congo. Because of this, produce will also be transported from Likouala

to Port Noire, which is 992 kilometers. In both cities, Tanguy farms shall supply the products to
supermarket and main markets. Pigs will sell in their live state to butchers who will serve as retail
outlets for sales.
Marketing
Tanguy Farms will use advertisement and personal selling as its main promotional tools.
Advertisement campaigns will be launched on La Radio Africaine and B-ONE RADIO - 87.8 FM
which have mass following. For the personal selling, sales personnel will visit restaurants and
hotels such as Olympic Palace Hotel, Radisson Blu M'Bamou Palace Hotel, Pefaco Hotel Maya
Maya and Hotel Brazzaville Beach. In these places, the produce will be sold to them at wholesale
prices
Services
Tanguy Farms will encourage clients to order their products. The farms will have an online portal,
where the products will be displayed. Customers who make large orders will have the products,
both the crops and animals distributed to them at no cost. Also, Tanguy farms will offer market
women one week credit period within which they can pay for foodstuff and pork that they have
received.
Secondary Services
Human Resource
The employee will be hired exclusively from Likouala, where the farms are located. This is a form
of corporate social responsibility that will provide livelihood to the people in the locality.
Candidates with prior experience in working in farms will be given preference and supervisory
roles.
Infrastructure
Tanguy farms employ a mechanistic approach. This is because with such heavy investments made
in this business, the interest of shareholders and all stakeholders must be protected. The channel
flow of information will be very rigid and a disciplinarian approach will be used to ensure effective
performance

Procurement and Technology
Irrigation systems, ploughs and combine harvesters are all important technology used in this
business. Gestation stall, fiber glass beans and sow farrowing create are also technology that will
be used in in the piggery. These technologies will be purchased from China, from Hangzhou
Zhizheng Industry Company, Ltd which has 13 years’ experience in crop production and animal
husbandry technology
Porters Generic
According to Delgado (2011) when there is a situation whereby the objective of the firm is to make
profits in a market that is attractive, then the position of the firm in that particular industry is very
important. There are some cases whereby the industry may be below average profitability.
However, even in such cases, firms which have been positioned optimally can be generating
superior returns at the expense of rivals as declared by Holmes, (2004). This has given rise to
Porter’s Generic strategies, which proposes three main strategic positions a firm can use as a source
of generating competitive advantage. These are cost leadership, focus and differentiation.
Cost Leadership
This is a strategic approach used by firms that have cost advantages. In most cases, having such
cost advantages allows the company to sell products at relatively cheap prices.
Tanguy Farms as has been explained already will be the first commercial farm in Congo, producing
tomatoes, cassava, potatoes and oil palm, as well production of pork. The above mentioned

commodities are all imported from other counties and so the incidence of taxes makes them more
expensive. Consumers have little bargaining power because their goods are necessity goods. The
cost advantages that Tanguy Farms pursue are first of all due to the access of land for agriculture.
Because of the lack of interest in farming and animal husbandry, lands for cultivation are cheap
and mostly undeveloped. The Government of Congo, in order to encourage crop production has
also engaged in leasing these lands at very small fees. Since land is an essential resource for this
business, cheap land is an avenue for cost advantages.
Secondly, cost of labor is quite cheap in Congo, due to the high rate of unemployment. This is the
reason why the agricultural industry though underperforming has close to 40% of employment of
workers. According to Nkono (2016), the legal monthly minimum wage in Congo is CFA 50400,
which is equivalent to USD 86.77. An unemployment rate of 53% (2012) means that there are
several employees willing to work for the exact minimum wage, even though some take lower
because of unemployment, albeit being illegal.
The final source of cost advantage that enables Tanguy Farms to pursue the cost leadership strategy
is economies of scale. By producing large volume of agricultural products, the average cost per
unit product reduces. In 2013, the Government of Congo offered tax holidays to farmers who
produce more than 1200 tons of agricultural produce for domestic consumption. Tanguy Farms
will be producing in excess of 8000 tons a year which makes it positioned to enjoy such tax
benefits. By pursuing this strategy, Tanguy Farms will sell products cheaper than imported ones.
Ansoff Matrix
The Ansoff Matrix is a model which is used for developing corporate growth strategies. The model
focuses on the presenting growth of the company in directions based on potential products and
potential markets. Should the company focus on growing through new products or existing
products, or new markets and existing ones, then four growth strategies can be presented to the
firm (Ansoff, 1957).

Market Development
The future growth model of Tanguy Farms will be the market development strategy, which can
also be called the market extension strategy. In this strategy, the company depends on the success
of the business proposition and then enters into another market. This is considered as a moderate
risk because once the business proposition has worked in one country; all that it takes is for the
company to identify a market which share similarity with the current market. For Tanguy Farms
to enact this strategy, the company will be exporting some of the agriculture products into other
countries. To decide the choice of country or market where these products will work, a simple
CAGE analysis will be made on the neighboring countries of Congo. The country with the highest
similarity with Congo will be a substantial market for export
CAGE Framework
This model explains that an organization that wants to go international can make a better choice
by identifying the Cultural, Administrative, Geographical and Economic similarities between the
host country and the international country. In most cases, the greater the similarity, the greater the
market potential
Three of the neighboring counties of Congo are presented in the table below and analyzed.
Cultural Very different culture
and languages
spoken. High Islamic
population does not
favor pork exports
Very different culture
and languages
spoken. Only
common language is
French
Similar culture with
Congo. Similar
languages spoken

Administration Operates on the
National Assembly.
High differences with
Congo
Similar
Administrative set up
at both Senate and
National Assembly
levels
Similar
Administrative set up
at both Senate and
National Assembly
levels
Geography 276 km from
Likouala to Bangui
929 km from
Likouala to Libreville
739 km from
Likouala to Kinshasa
Economy One of lowest GDP
per capita in the
world. Per capita
Income $ 276
One of Africa’s
highest GDP per
Capita. Per Capita
Income of $8,730.
Dependent on Oil
Low GDP per capita.
Per Capita income of
$499. Multi –
diversified economy
Based on the CAGE Analysis done, even though Central African Republic capital; Bangui, is
closest in terms of distance to Likouala, the market is unattractive because of differences in culture,
administration and Economy. Of the countries analyzed, Congo’s Kinshasa is the most attractive
market to enter.
The market development strategy will view Kinshasa as a suitable market to export Tanguy Farms
products into. Tanguy Farms, as part of this market Development strategy will begin by exporting
500 tons of the products in Kinshasa to test the market. Based on the response that is generated,
the company shall increase the quantity.
Business Canvas Model
A Business model canvas is a model that is used as an entrepreneurial and management tool, which
allows them to invent, challenge and design the business model
Key Partners Key Activities Value
Proposition
Customer
Relationships
Customer
Segments

Darko Farms
Hangzhou Zhizheng
Industry
AD Farms Limited
Large Scale
crop production
Piggery
Domestic
Sales of Pork,
Cassava, Oil
palm, Potatoes
Extended credit
facilities
Free Distribution
Restaurants
Hotels
Butchers
Key Resources Revenue
Stream
Cost Structure Channels
Farmers
Ploughs
Sow farrowing
create
Gestation stall
Sales of
Agricultural
Produce
Cost of
machinery
Cost of
vaccination
Employee
salaries
Radio
Advertisement
Road and Rail
transportation of
produce
BUSINESS PLAN
Overview of Tanguy Farms
Tanguy Farms is the first commercial farm company that is participating in the highly under
growing agriculture sector in the Republic of Congo. This company set up on the foundation that
the Republic of Congo is a country that does not depend on domestic propagation of Agricultural
produces but rather heavy importation. With data obtained from the Ministry of Foreign Affairs of
the Republic of Congo (2015) pointing out that a third of the total volume of imports in the country
comprising of agricultural produce, Tanguy Farms offer products that will reduce the volume of
importation, whiles satisfying the aggregate market demand.
Even though the ratio of arable land to non – arable land is 1:16, the arable land has been gravely
underutilized and under – developed, making investments in agriculture largely unattractive for
many investors. It is the view of Tanguy Farms that by being the first mover in this industry, it
will stimulate further investments to develop lands in Congo for further propagation of agriculture
in the country.
CHAPTER FIVE

Ownership of Tanguy Farms
Tanguy Farms will be established and registered as a partnership. In the third chapter of this
document it has already been established the feasibility of the organization as a partnership and
the advantages that registering it as a partnership presents. The farms will be owned by two
principal partners who are Tanguy Zoungani and Ali Missbaye. Both partners have an equity
contribution but unequal and for this reason, profits in the company are distributed based on the
contributions of the contributions of the partners. Tanguy Zoungani is the maximum shareholder
of Tanguy Farms, with 57% share of profits, whiles Missbaye has 43%.
57%
43%
Partners
Tanguy Zoungani
Ali Missbaye

Legal Registration of Tanguy Farms
There are rules and regulation that needs to be followed upon instituting Tanguy Farms. To start
with, Tanguy Farms will provide a full document detailing the business model and business
objectives and mode of operations of the company. This will be submitted to the Director of the
Registrar General’s Office of Congo which will take a maximum of 10 working days to be
reviewed and accepted before permits will be obtained as the registered business entity with license
to operate. However, this does not imply that Tanguy Farms can commence operations unless it
obtains similar permit from the Ministry of Food and Agriculture, due to the fact that it will be
operating in this sector. The Ministry is mandated to inspect the equipment of Tanguy Farms, the
land proposed to farm and the appropriateness of the operations at the location and the industry. A
clearance certificate will be issued to Tanguy Farms which will enable the company to commence
cultivation of land and production of food crops.
Value Proposition
According to Roberts (2004) in order to be successful, a firm must be able to offer value to several
stakeholders. A business set up that does not offer value to its stakeholders will not be as successful
in the industry as it aspires to be and the resources that have been invested in it may be wasted.
The following are the stakeholders that will receive value thorough the setting up of Tanguy Farms
Government of Republic of Congo
A report from the Ministry of Trade and Industry, Agriculture and Foreign Affairs has shown a
growing trend in the quantity of Agricultural products imported in the Republic of Congo. In 2012,
3/10th
of total imports were composed of Agricultural products (Buyae, 2014). In 2013, a quarter
of the imports were of Agricultural products whiles in 2015, the figure grew to a third of imports.
This may be as a result of the 3.1% growth rate of the country. The growth rate only goes on to
signify that there is more pressure on the government to allocate funds drawn in the national budget
towards agriculture importation (Ministry of Trade and Industry, Rep of Congo, 2015). The set -
up of Tanguy farms will therefore reduce this pressure of Government and redirect national budget
to other sectors of need such as Health.
Financial Institutions

Financial institutions will be the source of loans administered to Tanguy Farms and this will be
the debt component of the capital structure of the company, However, like every debt, there will
need to be repayments with interest. Having a unique business model and taking advantages of the
lack of domestic competition in the industry alongside skills of the employees will make Tanguy
Farms more than capable to generate Earnings Before interest and Tax, enough to pay for the loans
acquired. In view of this, financial houses that provide such funds to Tanguy Farms will benefit
from the ability of the company to pay interests.
Employees
One of the major macro – economic problems affecting the Republic of Congo is the high rate of
unemployment. Index Mundi (2012) estimated the unemployment rate of Congo to be 53.5%,
making it one of the highest in the world. This statistic consisted of people who are in the active
labor force but cannot secure jobs. The reason for such high rate of unemployment can be attributed
to the fact that the oil industry which provides up to 65% of national income of the country merely
employs 2% of the labor force (Nkoudi, 2013). Being a commercial Farm, Tanguy Farms will have
a total number of employees ranging from 1000 – 2700, who will be involved in various units of
production and distribution. This will reduce the number of unemployed people in the country.
Marketing Plan
The marketing plan is the section of the overall business plan which focuses on establishing a solid
marketing strategy for the products or services that are being proposed. A marketing plan will
include actions that will be undertaken by the firm. However, in the absence of a secured strategic
foundation, the marketing plan will have little use. According to Blauman (2011) the marketing
plan is very comprehensive and conceptualizes the specific marketing objectives that needs to be
achieved and how they should be achieved.
Market Segmentation
Market Segmentation is described by Grimsley (2006) as an alternative to mass marketing and has
been regarded as one that is more effective. Segmentation of the market is explained as the
subdivision of the overall market due to distinctive and specific characteristics. Whiles mass
marketing allows the company to use and direct the same marketing activities to the mass market,

market segmentation allows the company to tailor specific marketing activities to unique segments
identified.
Geographic and Demographic Segmentation
Since necessity goods and services such as food, housing, electricity and health care are needed
by the populace, firms that are into the offering of these services usually use mass marketing.
However, there is a level of uniqueness about the products that are being offered by Tanguy
products and for this reason, the geographic and demographic segmentation strategies will be
employed by this company. There are 86 districts and 6 communes in the Republic of Congo. Each
of these districts will be viewed to make an assessment of which of them will be offer the best
profit potentials to be targeted. Also, using demographic segmentation, the beliefs of the
population will be taken into consideration, as some religions do no consume pork.
Market Targeting
Market Targeting is an activity that follows market segmentation and is done after the
identification of suitable segments which merit focus of the company’s marketing activities. By
Virtue of geographic segmentation, Brazzaville, Pointe-Noire and Dolisie will be the targeted
markets of Tanguy Farms. These are the three largest cities in the country and therefore have the
relatively higher per capita incomes, making it more attractive as major locations to distribute
Tanguy Farm Products, even though the Farm itself will be located in Likouala. Based on religion,
the target market will be Non – Muslims, who make up 98.4% of the market
Positioning
Tanguy Farms will be positioned in as firm that is promoting domestication by encouraging
citizens of Congo Brazzaville, to consume locally produced food. The positioning can be done in
two ways, which are point of parity and point of differentiation. For point of parity, Tanguy Farms
will be offering the market agricultural produce in commercially viable quantity for domestic
consumption. The differentiation of this is that the Farms shall produce completely using organic
means. This quite different and healthier than those imported from neighboring countries, most of
which are genetically produced.

Marketing Mix
The marketing mix is a collection of 4 elements for a product company and 7 elements of a services
company, with each element focusing on how best the value proposed by the company can be met
(James, 2011). The following represents how the marketing mix is applied to Tanguy Farms
Product
Tanguy Farms is proposing to offer agricultural products to the Congolese market, which up until
this time has depended heavily on importation of agricultural products. The main crops that will
be propagated by Tanguy Farms are cassava, tomatoes, oil palm and potatoes. These are crops
selected on the basis on their local demand and quantity imported per given year. Pig products will
also be introduced as part of the product line based on the heavy consumption and low presence
on Muslims in the country
Price
Competitive pricing strategies will be used by Tanguy Farms as a means of countering the
imported products into the country. Since the agricultural produce of Tanguy firms are produced
domestically, the firm will enjoy cost advantages due to proximity to the main market and absence
of import duties. This will equip the company to set prices of our produce slightly lower than those
imported
Imported Products Price per kg Tanguy Farms price per kg
Cassava = 2.4 dollars Cassava = 2.1 dollars
Tomatoes = 1.8 dollars Tomatoes = 1.4 dollars
Oil Palm = 1.9 dollars Oil Palm = 1.5 dollars
Potatoes = 2.2 dollars Potatoes = 1.8 dollars
Pork = 4 dollars Pork = 3.4 dollars
Place
The channel of distribution will via rail from the main farm plantation in Likouala to the main
cities of Brazzaville, Pointe-Noire and Dolisie. They will be sold to major supermarket and

retailers to aid distribution into smaller market places in the cities, making the crops and meat
accessible to all households
Promotion
Tanguy Farms will use advertisement and personal selling as its main promotional tools.
Advertisement campaigns will be launched on La Radio Africaine and B-ONE RADIO - 87.8 FM
which have mass following. For the personal selling, sales personnel will visit restaurants and
hotels such as Olympic Palace Hotel, Radisson Blu M'Bamou Palace Hotel, Pefaco Hotel Maya
Maya and Hotel Brazzaville Beach. In these places, the produce will be sold to them at wholesale
prices
Operational and Organizational Plan
This is the aspect of the business plan which describes the way that the organization is structured,
as well as the mechanisms that are put in place towards the carrying out of the tasks and duties in
fulfillment of the business plan. The relevance given to this aspect of the business plan is that,
without proper execution of the strategy that has been put in place, the business plan will be
meaningless (Fontinelle, 2013)
The Organizational Structure
According to West (2011) the organizational structure can be described as hierarchical
arrangement of the lines of communication and authority in the organization, as well as the rights
and duties of the employees. In other words, the structure is a determinant of how the powers and
the roles in the organization are assigned and the information flow
Partners
Marketing and
Sales Manager
Animal Production
Manager
Administration
Manager
Water Production
Manager
Financial
Manager
Agricultural
Assistant
Crop Production
Manager

Functional Organizational Structure
Tanguy farms employ the staff of functional organizational structure. This is a form of
organizational structure, whereby the line managers identified in this structure has the direct
authority to exercise over subordinates to achieve the objectives of the company. In Tanguy Farms
limited, the various lines as seen from the organizational chart are of the Animal production line,
Crop production line, Credit management, Accounts and Administrative management and water
resources. These form the main controlling units of the farms and their roles are designated to
preside over activities in both the animal husbandry section of the company as well as the crop
production units. The feasibility of this organizational structure is based on the advantages that it
brings to the company. For example, with this structure, there is no need to have all rounded
executives on the farms because each line or functional unit is selected based on their specialization
in the field. This is very important because the project is a high risk project. It also increases the
control span in organization.
Location
Tanguy Farms will be located in the department of Likouala, which is located in the Northern part
of the Republic of Congo. The region has a total area of 66,044 km² and shares a border with
Cuevette and Sangha which are in the Democratic Republic of Congo and Central African
Marketing
Coordinator Human Manager
Supply Chain
Manager
Research Assistant
Potatoes
Supervisor
Oil Palm
Supervisor
Tomato
Supervisor
Cassava
Supervisor
Accountant
Sales
Coordinator
Sales PersonnelSales PersonnelSales PersonnelSales Personnel

Republic respectively. Likouala has a typically tropical climate with a dry season that begins from
March to July, whiles the remainder of the year is dominated by rain. Temperature variations are
within 24° to 25°C. The conditions are Likouala makes it one of the favorable places of Agriculture
in a country where most of the land is not arable. Access to skilled and unskilled labor is also easy.
This is not because of the 90,000 inhabitants of Likouala, but because of the fact that the region is
known to produce banana, coffee and oil palm. In 2015, there was yield of 1500 tons of cocoa in
the region.
Supply Chain Management
This refers to the flow of goods and services with emphasis on the storage of raw materials,
working in process inventory as well as the finished goods from the production or manufacturing
point to the point of consumption.
The figure above is a flow chart describing the supply chain of Tanguy Farms. As has already been
declared, the Farms will be located in the Likouala, which is in the North of Congo. However,
Likouala is not going to be the main market of sales of the Farm produce but rather Brazzaville,
Ponte Noire and Dolisie. Upon Harvest, the crops and pig products will be transported to
Brazzaville by rail, which will cover a distance of 751 km.
Pointe Noire is surrounded by water and therefore being the second largest city in Congo, the
products will be transported by sea, covering a distance of 994 kms.

In the case of Dolisie, travel by road will be used to transport the farm produce and this will cover
a distance of 888km. In the three major cities, the products will be distributed to local retailers and
wholesalers who will make them available to customers through distribution channel with the local
market.
Financial Plan
Cost Drivers
Cost Drivers are referred to as the main factors which cause a changed in the shape of the cost
structure of the company.
Fixed Costs Amount in $ Variables Costs Amount in $
Tractor 25000 Pig feeding 4000
Feeding Equipment 1500 Fertilizer 2400
Irrigation Machinery 2500 Employee bonuses 3000
Farming Tools 6500 Miscellaneous
Truck 20500
Wages 13000
Computers 3400
Furniture 2000
Storage Equipment 3500
Total Fixed Cost: 77900 Total Variable Costs: 32,100
70.9% 29.1%

Cash Flow Statement
The cash flow statement is one of the main financial statements and provides a report of the main
cash that is generated and used during a period of the business. Because Tanguy Farms is not yet
established, the cash flow statement that is shown below is one that is projected. It is important to
prepare a cash flow because the reported revenues in the income statement are computed using
accrual accounting and therefore some of the revenues may be recorded but not actually collected.
Year 1 Year 2 Year 3 Year 4 Year 5
Cash Flow Operations
Cash Receipts from
Customer sales 125,000 143,750 165,312 190109 218625
Operations Cash Flow
Cash paid for
Inventory Purchase 65000 67300 68100 70000 75500
Expenses on Admin 20000 21000 22400 23100 23500
Wage 13000 13600 14500 15700 16500
Interest 7600 7600 7600 7600 7600
Taxes 2600 3100 3300 3700 4100
Net Cash Flow from Operations 36800 41150 59412 80009 101425
Cash From Financial Investment
Cash receipts from
Equipment sale 9000 10600 11500 12200 13000
Cash Paid for
Purchase of equipment 11000 13700 17800 20000 24200
Net Cash Flow from Investment 20000 24300 29300 32200 37200
70,90%
29,10%
Total Fixed
Total Variable

Cash Flow from Financial Activities
Cash Receipts from
Lending
Paid Cash
Stock repurchase
Loans repaid 4200 6400 8600 10000 11700
Dividends 3000 3500 5300 7700 9500
Net Cash Flow from Financial
Activities 7200 9900 13900 17700 21200
Net Cash Flow 12800 14400 15400 14500 16000
Net Present Value
The Net Present Value, simply referred to as NPV, is an investment appraisal tool, which is used
by financial analysts to forecast the potential of an investment. In using this as an investment
appraisal the cash flows from operations will be used and will be discounted, after which the
resultant figure will be subtracted from the amount invested. If the cash flow is positive, then the
investment is worthy of putting finances in. On the other hand, a negative net present value means
that it is not a financially sound investment. The discount rate used for the calculation of the NPV
is 14%. The Table below shows the net present value of investment in Tanguy Farms
Year Cash Flow % interest 14 present value
0 ($110,000) ($110,000)
1 $33,522 $29,405
2 $45,539 $35,041
3 $44,400 $29,969
4 $28,500 $16,874
5 $23,500 $12,205
Sum of Present values $123,494
NPV = $123494 – 110000
NPV = 13,494
The Net present value calculated shows a positive figure of 13,494. This means that an investment
into Tanguy Farms will be profitable and will enable the investor to be better off by $ 13,494

Discounted Payback Period
This is a measure of the year within which the amount invested can be can be derived. The
discounted present values are summed until the point where the amount of money covers the
invested capital. From the table, the Payback period will be 4yrs 3 months
Business Schedule
Below is a time table of the start-up of Tanguy Farms
Task Start date Date of Finish Duration
Tanguy Farms
Customer Segmentation 11/08/2017 14/08/2017 11
Market Analysis 16/08/2017 19/08/2017 9
Secondary Data Analysis 18/09/2017 21/08/2017 12
Development of Farm Set - Up 22/09/2017 27/08/2017 13
Segment Analysis 30/09/2017 01/08/2017 9
Target Market Identification 1/10/2017 05/08/2017 10
Financial Analysis 9/11/2017 11/08/2017 11
Structuring of Fixed Cost 16/12/2017 18/08/2017 15
Surveying of Likouala 16/01/2018 21/08/2018 10
Purchasing of Equipment 21/01/2018 30/08/2018 17
Registration of Tanguy Farms 27/01/2018 1/08/2018 14
Permission from IRS 1/02/2018 12/08/2018 13
Operations and Management 1/02/2018 18/08/2018 10
Employee Search 10/02/2018 19/08/2018 12
Tanguy Farms 26/02/2018 31/08/2018 11
Employee orientation 05/03/2018 6/08/2018 10

Risk Analysis
Risks are natural occurrences in business, especially when the business has not yet been fully
established. This is because in todays the environment is often unstable and as a result subject to
periodic changes. Lamar (2001) explains that risk analysis is important to a start – up firm, because
it will help them identify possible hindrances to the success of the firm. Through this, they can be
able to discover contingency plans to counter these threats.
Potential Risks
Political Instability
One of the major risks associated with doing business in Congo is the periodic unrest that arises in
the country in terms of politics. The Republic of Congo has not been new to violent clashes since
it gained independence in the 1960’s. The country has experienced several civil wars, which has
emanated from coupe d’etats and political rivalry between incumbent and opposition. Whiles these
unrests slowed down, during the last decade, an announcement by the current president (Denis
Sassou Nguesso) change the constitution and run for another term has resulted in major clashes
between protestors and supporters, leaving several people dead and property destroyed.
Source (France24, 2015)
With property being burnt, establishing a farm is a high risk business because leaves can easily
catch fire. Also since the crops are rooted to the group, the cannot be transported from one location
to another

Lack of Presence of a First Mover
In many cases, firms that are first movers hold a lot of advantages because they are able to have
first mover advantages, such as access to customers, establishment of entry barriers, among others.
However, the presence of a current first mover also helps new entrants to learn from the first
mover’s mistakes and research and development made. However, for such a high risk business,
the lack of a first mover of commercial farms in Congo, which is known less for agriculture, is a
major threat. There is not much knowledge about the acceptance of neither the market nor certain
danger from the land that may arise.
Contingency Strategies to deal with risks
There is very little that can be done about the political unrest in Congo Brazzaville, since it is a
macro – environmental condition. However, the location of the Farm, which is Likouala, is one of
the way of dealing with this threat. Likouala is in the North of Congo and shares border with
neighboring Central African Republic which is relatively peaceful. Whiles most of the clashes
occur in the capital city, Brazzaville, Likouala has always been peaceful and known for its forest
vegetation. A political unrest will likely not affect the farms because Likouala have no resources
which will be fought for. However, this unrest will make Brazzaville unattractive as a market for
Tanguy Farms. In view of that, since Likouala is a border town to Central African Republic, the
produce can be sold across border towns
The absence of first mover means that to counter this risk, there will be the need to conduct greater
research of the market’s acceptance for domestically produced food crops and meat, as well as the
suitability of the soil. Tanguy farms will therefore do a test planting and harvesting for eight
months on a small scale, to properly identify the suitability of the business, in both land and market,
before full scale production begins.
Alternative Business Idea
The size of the propose land for Tanguy farms is 170 m x 190m. This size is incidentally enough
to develop a football stadium, as per FIFA laws. An alternative business Idea, should the
contingency plans fail to develop will be a football stadium. Congo, like several African countries
is very passionate about football and its development has been encouraged by the Government.
The country won the Africa Cup of Nations in 1972 and is currently ranked 60th
best football team
in the world. However one of the main drawbacks towards development of the sports is access to

quality football pitches. Currently there is heavy dependence on Stade de la Revolution,
Brazzaville, which is the national stadium of Congo. This stadium has a 33,000 capacity and is
located in the capital Brazzaville. The North of Congo, where Likouala is located has not adequate
stadium to promote the development of the sport. Once the land is leveled for agriculture, in the
event that the business fails to flourish will lead to the conversion of into a stadium with a 40,000
capacity. This will be the first privately owned stadium in the country and will facilitate not only
football, but also track and field sports. Users will pay monthly rent for using the stadium facility
and this will boost the country’s chances of hosting the African Cup of Nations. Also, the presence
of a stadium in the region will facilitate growth, as Government will reconstruct the roads leading
to the stadium, whiles it will create an avenue for investors to set up hotels and Guest Houses in
the region.
References
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http://www.afdb.org/en/knowledge/publications/african-economic-outlook/ (Accessed on) 23rd
May, 2016
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(Accessed on) 12th
June, 2016
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(4) - 114
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(Accessed on) 11th
May, 2016

Bram, L (2014) Domestic Growth Cash Crops in Congo [Online] (Available from)
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May, 2016
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June, 2016
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June, 2016
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9th May, 2016
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www.indexmundi.com (Accessed on) 11th
May, 2016
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May, 2016
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June, 2016
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May, 2016
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June, 2016
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towards R&D [Online] (Available from) www.ministryoffoodandagticuluture ag.com (Accessed
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June, 2016
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June, 2016

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May, 2016
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africa.org/democratic-republic-of-congo/climate-agriculture (Accessed on) 21st May, 2016
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June, 2016
Appendices
Appendices 1 (Map of Congo and Climate)

Appendices 2 (Location of Site)
Appendices 3 Import of agriculture produce over the last 6 years

0
5000
10000
15000
20000
25000
30000
35000
40000
45000
50000
2010 2011 2012 2013 2014 2015
Cassava
Cassava
0
5000
10000
15000
20000
25000
30000
35000
40000
2010 2011 2012 2013 214 2015
Potatoes
Potatoes

62000
64000
66000
68000
70000
72000
74000
76000
78000
80000
82000
84000
2010 2011 2012 2013 2014 2015
Tomatoes
Tomatoes
36000
38000
40000
42000
44000
46000
48000
2010 2011 2012 2013 2014 2015
Oil Palm
Oil Palm

Source: Ministry of Agriculture (2015)
0
20000
40000
60000
80000
100000
120000
140000
2010 2011 2012 2013 2014 2015
Pork
Pork

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