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Similar to Day 1 - Module1 - Small scale seed enteterprise - Session 1
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Day 1 - Module1 - Small scale seed enteterprise - Session 1
- 1. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 SEEDS TOOLKIT MODULE 1: Development of Small-‐Scale Seed Enterprises
- 2. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 What is a seed enterprise? A private undertaking for the produc1on and sale of quality seed to farmers FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016
- 3. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 SelecAng crops and varieAes • Crops and varie1es farmers want to produce • Not all crops make successful seed business • Most profitable crops are the best • Crops can be combined for high gains
- 4. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 Producing seed in the field • Own seed produc1on • Or using contract farmers • All agronomic prac1ces done carefully • Roguing and field inspec1on must be done
- 5. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 Roguing
- 6. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 Field inspecAon
- 7. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 Cleaning, treaAng and packaging • Cleaning to remove all unwanted materials • Using chemical treatment only when necessary • Using good packaging material • Labelling seed bags with relevant informa1on • Providing warning if chemical treatment is used
- 8. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 Seed cleaning
- 9. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 Storing seed PuUng seed on pallets during storage
- 10. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 TesAng seed for quality Seed must be tested to make sure it is clean, without disease, true-‐to-‐type, germinates and grows well in the field
- 11. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 MarkeAng seed to farmers • Selling all seed and avoiding carryover • Promo1ng and convincing users to buy seed
- 12. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 EXERCISES
- 13. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 GeOng ready to start • Talent, skill, discipline and hard work are needed to start a seed business and succeed • First, assess your strengths and weaknesses
- 14. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 Why start a seed business? • There is market for quality seed in your area • There is a gap to fill in the seed market • You have resources, knowledge and experience to run your own business • Expand an exis1ng business by adding seed
- 15. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 What skills do you need? Careful planning, prepara1on and organiza1on
- 16. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 • Maintaining strong mo1va1on – always • Making 1mely decisions under pressure What skills do you need?
- 17. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 • GeUng along with all kinds of people • Capacity to learn, being flexible, and forward looking What skills do you need?
- 18. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 Which enterprise structure is best? • Individual business • Family enterprise • Group enterprise
- 19. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 Individual business Advantages • Make own decisions • Keep all income • No misunderstandings Disadvantages • May need skills of others • Provide all needed finance and resources alone • Bear all risks alone
- 20. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 Family enterprise Advantages • All benefits remain within the family • Strong trust and loyalty in families and tend to s1ck together • Strong commitment to success or willingness to make sacrifices • Concern for future genera1ons encourages long-‐term thinking Disadvantages • Destruc1ve rivalry may exist among family members • Succession can be a source of dispute • Personal 1es can inhibit honest opinion • One family member may dominate the business • Older members may refute new ideas or resist change
- 21. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 Group enterprise Advantages • Sharing of ideas among group members • Higher output and revenue when more people work together • Easier access to credit at lower cost Disadvantages • Disagreement in the group can lead to conflict • Weak leadership can result in business failure • Few key members can exclude others in decision making • Groups tend to depend on outside financing than own funds
- 22. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 Which crops or varieAes to produce? • Focus on profitable crops with sufficient seed demand • Choose crops and varie1es preferred by farmers • Don’t depend on one crop but have a combina1on of few crops • Combina1ons could comprise low and high value crops or crops which rotate well on same piece of land • Growing too many crops or varie1es at the same 1me can be complicated
- 23. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 SelecAng the right crops and varieAes The image cannot be displayed. Your computer may not have enough memory to open the image, or the image may have been corrupted. Restart your computer, and then open the file again. If the red x still appears, you may have to delete the image and then insert it again.
- 24. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 Advantages of crop combinaAons • Risks of failure due to adverse weather, pests and diseases and price falls can be spread • Produce income more than once in the year • Op1mize use of labour, equipment and other facili1es the year round
- 25. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 Deciding the scale of your business • Scale of your business depends on size of the market and expected growth of the business • Capacity (staff, machinery, processing and storage facili1es, and transport) should match the quan1ty or value of seed produced • Avoid excess or underu1lized capacity
- 26. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 IdenAfying market niche to target • Marke1ng is dynamic, so current and future needs of farmers may change • Therefore, carry out market research to understand farmers’ behaviour and their specific needs • Try to sell seed of par1cular crops or varie1es which are afrac1ve to specific groups of buyers
- 27. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 SaAsfying and maintaining your niche market • Selec1ng appropriate crops and varie1es • Delivering higher quality seed and befer services than exis1ng suppliers • Making sure your seed sa1sfies a need in the farming community • Choosing the right packaging material and sizes according to needs • Assessing the compara1ve advantage you have to cope with compe11on from other suppliers • Having good idea how you can increase demand for your seed while expanding your business
- 28. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 SaAsfy your niche market
- 29. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 Determining how much money you need • By es1ma1ng the costs of labour, equipment, facili1es, materials and inputs you need for the enterprise • Note that producing quality seed requires addi1onal inputs, specialized equipment and facili1es than normal grain produc1on • Explore how to raise the necessary funds
- 30. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 How much money?
- 31. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 Exploring sources of funding • Self-‐finance • Credit or loan from financial ins1tu1ons, which may charge high interest rates • Credit from family or neighbours
- 32. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 Managing and controlling your enterprise • Specialized skills and exper1se are essen1al for a successful seed enterprise • Individually-‐run businesses would seek the services of others having certain abili1es and competencies • Members of group enterprises may carry out all necessary func1ons • Group enterprises would need rules and regula1ons to guide the conduct of its members
- 33. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 Risks enterprises may face • Technical (e.g., equipment breakdown) • Produc1on (e.g., poor harvest) • Financial (e.g., lack of funds to pay salaries) • Marke1ng (e.g., fall in market share) • Management (e.g., few key people domina1ng a small-‐scale seed enterprise)
- 34. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 Other pre-‐condiAons • Name – this should be afrac1ve, easy to remember and meaningful • Logo and slogan – these go hand-‐in-‐hand. Choose a simple logo, cheap to print or copy • LocaAon – should be easy to recognize and promote and reached by farmers • RemuneraAon – how to compensate yourself or other members of the group Once ready to start the seed enterprise, the above considera1ons will be useful for developing a comprehensive business plan.
- 35. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 EXERCISES AND DISCUSSION
- 36. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 Understanding costs and benefits • Basic principles: know your total costs, set your price and es1mate your profit • Have enough money to pay for all inputs and running costs for the whole year un1l you harvest and sell your first seed crop • Loans taken should be paid plus interest before any profit is generated • Do not underes1mate cost factors such as your 1me or that of the group or family members • Likewise, do not overes1mate your profit
- 37. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 Main costs incurred • Fixed costs – these do not change with the amount of seed you produce, and include salaries, rent and the cost of machinery and equipment • Variable costs – these tend to increase or decrease depending on the quan1ty of seed produced, and include the costs of founda1on seed, fer1lizer, labour inputs, packaging and seed treatment material To be cost effec1ve, produce and sell as much seed as possible so as to spread your fixed costs over as large a volume of seed as possible.
- 38. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 PotenAal profitability • Do not start a seed enterprise if you are not certain that you will generate a profit • To make a profit, the expected income from sales must exceed the total spent on produc1on • Es1mate in advance your total costs and expected income to calculate your profit margin
- 39. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 EsAmaAng profit See Seeds Toolkit Module for details
- 40. FAO/AfricaSeeds Valida1on Workshop Seeds Toolkit Abidjan, Côte d’Ivoire 14-‐18 November, 2016 EXERCISES AND DISCUSSION