Business Plan

ABSTRACT
The orange has become the most commonly grown tree fruit in the world. Orange possibly originated in China, where the Chinese started planting it about four thousand years ago, but now it is an important crop in the Far East, the Union of South Africa, Australia, throughout the Mediterranean area, and subtropical areas of South America and the Caribbean. The United States leads in world production. In Brazil, oranges are grown everywhere in the coastal plain and in the highlands where orange culture rose sharply in the years immediately following World War II and is still advancing.
Large quantities of fresh oranges and orange juice concentrate are exported to the United States and small shipments go to East Germany, Canada and Argentina. However, overproduction has glutted domestic markets and brought down prices and returns to the farmer to such an extent that plantings have declined and growers are switching to other substitute products.
In Bangladesh orange is grown in some places of Sylhet, Chittagong Hill Tracts, Rangpur, and Panchagarh. The most commercially species important are the common or China orange, C. sineusis; the mandarine orange, C. reticulata, some varieties of which are known as tangerins; and the sour or Seville orange,C aurantium.
The following report is a business plan of an Mandarin orange orchard, “Tree-mendus Orchard” /Six-seasons Orchard, Orange County” planned to have located near hill tracks of Goalbari, Moulovibazaar, Sylhet, having noted that, it is one of finest and most desirable place bumper cultivation of orange in Bangladesh. Sylhet is widely known for its citrus fruits (lemon, pineapple, orange, malta, etc) production, followed by efficient supply chain management and potential economies of scale (internal and external).
The business plan describes all the elements and criteria supporting the establishment of the business and executing accomplishments and goals for the long run.
INTRODUCTION

Tree-mendous Orchard is a partnership of four members, each having the equity of the same amount. Each person is responsible for the debts and obligations of the business unless they file for “limited liability.” Income and expenses are reported on federal and state “information” tax returns filed by the partnership. Partners are taxed on their respective share of the profits at their individual income tax rates.

High quality fruit produced by commercial growers is the result of years of experience in horticultural practices in addition to large financial expenditures in equipment, materials and labor. With a record of desirable production of orange in the Moulovibazar, having a favorable weather and irrigational condition, the farm believes in a desirable yield, taking highly in account of its productivity fluctuation with the change in climate, pollination, soil quality, propagation, pest control, etc.

After nursery plantation and fertilization, the trees require blooming its fruit not less than 3-4 years. The farm therefore has decided to invest a little more on the orchard and furnish it to give it a look of a picnic spot and rent it likewise for a regular flow of income. Charges will be set prior to season and occasions.

Property will be developed in a free flowing, park like fashion, with an interspersion of fruit trees and edible landscaping plants that will elevate our customers from the simple act of buying fruit or nursery stock to that of experiencing our natural environment at its best.
This arboretum-type setting will provide customers the opportunity to take a "fruit walk" to sample many different fruit cultivars in season and subsequently purchase more fruit, or the nursery stock to grow their own. Sylhet, having greater prospects to attract tourists with its possession of unique blend of nature and mankind, and also for being a trademark for growing oranges in the country, the location of the farm gives it a high opportunity to meet regular customers for both the picnic spot and the orchard.

Company Profile:

NAME

Tree-mendous Orchard

Tag Line

“Rebuilding a Fruitier Nation”

Mission Statement

To be:
The leader in the orchard farm market
Through:
Outstanding customer service, quality farm related products and practices, driven by dedicated, efficient and knowledgeable employees.
Resulting in:
Customer loyalty, exceptional value for our customers, an outstanding public image and recognition, that supports and rewards our family and employees.

Vision Statement

To be competitive in the growing market as the quality managed farm

Values

We consider our values statement to be the heart of our business plan, perhaps because it is directly related to and heavily influences every other part of our operation. Also, in a business climate such as is generally encountered in today’s market place, clearly stated, unshakable, time-honored company values can become the bed-rock for healthy, profitable, long-term customer relationships as well as the catalyst for new contacts. Therefore we summarize as concisely as possible our values in the three areas in which we primarily function:

Community values: The rural community ethic is at the core of our business and being part of a thriving local economy with it 's own viable food chain and cultural integrity is one of our greatest desires.

Environmental values: We are committed to using only natural, organic cultural practices on our farm, providing for our sustenance in a manner that is not only ecologically sustainable but also enhances the quality of the soil and the environment for future generations.

Key Products and Services
We will continue to offer the best varieties of fruiting and edible landscaping plants for our specific soil and climate conditions to local customers, along with products and services to complement our nursery stock. Research and educational opportunities will be stressed to enable customers to take full advantage of the products and services we offer.
Product: Fruit production (orange- mandarin)
Services: Picnic and camping areas will be provided to encourage family participation., catering for picnic customers and reservation of trees and garden in the premises.

Strategic Goals and Objectives

The orchard industry should expand production and maintain consistent top quality in order to be a healthy and competitive force in the market place.
Six years of guaranteed market is still an opportunity to dispose as much as we can (i.e. > 70,000 tons as against 20,000 tons/ year). Farmers ' morale and confidence need to be re-energized in order to boost production and quality. The markets for orange have tremendous promise. Farm enterprises reflecting these should be explored. (Restaurants, exports, and other companies where orange is considered a raw material).
Set target acreages for annual production volumes

Industry Overview & Analysis

In Bangladesh orange is grown in some places of Sylhet, Chittagong Hill Tracts, Rangpur, and Panchagarh. The most commercially species important are the common or China orange, C. sineusis; the mandarine orange, C. reticulata, some varieties of which are known as tangerins; and the sour or Seville orange,C aurantium
Plantation of orange has come down from 1,070 acres (1990-91) to 790 acres (1994-95) in Bangladesh. Plants start bearing fruits after 4-5 years of plantation.
Currently, other than Sylhet district, there are some three lakh orange trees including tender and fruit giving ones on over 450 small, medium and large- scale orchards and many homesteads covering nearly 200 hectares in Thakurgaon and Panchagar.
Massive steps have been taken for boosting the expanding orange farming sectors that has already got a stronger footing bringing fortunes to hundreds in Sylhet, sub-Himalayan Panchagarh and Thakurgaon districts in Bangladesh.
The government has taken a Tk 100-crore special package programme for boosting the growing small-scale tea and also enhanced the ongoing five-year term expanded orange farming there with possibilities for expansion in the adjoining areas. Besides, the government has been providing necessary supports including quality saplings, training and technologies to the farmers under the ongoing five- year term expanded orange cultivation programme from 2006, under Orange Development Project (ODP) of the Department of Agriculture Extension (DAE).
Presently, over 80,000 orange trees have been growing in 93 orange orchards set up in 104 hectares land and homesteads in Sylhet and more 110,000 orange plants in the 134 hectares land in adjoining Thakurgaon and Panchagarh.
Sadly, in Bangladesh, where value seems to attach to foreign origin, even these local oranges are often described by shop owners as ‘Indian Oranges’.
Though there are no specific orchard farms with registered and formal names, the orange production industry Orange farming has changed the socioeconomic conditions of people in the country. The government took an initiative in 2000-01 and set up some 13,000 orchards on selected farmers ' land in the Sylhet region, said AKM Rafiqul Islam, additional director of Department of Agricultural Extension (DAE) in Sylhet.
A new and expanded programme could boost orange farming in the region as the growers are getting good prices for their produce now, The farmers have also become more conscious and sincere about the procedure for pricing and marketing of the fruits. The popular fruit has the potential to become a cash crop for farmers in the districts, according to horticulturists of Orange Orchard Development Project.
Besides orange, different other fruits grow in Bangladesh round the year because of favorable climatic conditions. A list of the common fruit trees showing the area of production and yield is given below.
English name
Local name
Scientific name
Area under production (in 000 ha)
Yield (thousand m ton/year)
Banana
Kala
Musa sapientum
40
630
Jackfruit
Kathal
Artocarpus heterophyllus
27
265
Mango
Am
Mangifera indica
50
190
Litchi
Lichu
Litchi chinensis
5
13
Hog Plum
Amra
Spondias dulcis
--
--
Papaya
Papaya
Carica papaya
5
41
Coconut
Narikel
Cocos nucifera
--
--
Guava
Payara
Psidium guajava
10
46
Star Apple
Jamrul
Syzygium samarengense
--
--
Black Berry
Kalajam
Syzygium cumini
--
--
Orange
Kamla
Citrus chrysocarpa
0.3
8
Grape Fruit
Jambura
Citrus grandis
4
11
Indian Apple
Bel
Aegle marmelos
--
1
Wood Apple
Kathbel
Feronia limonia
--
--
Custard Apple
Ata
Anona squamosa
--
--
Indian Jujube
Boroi
Zizyphus mauritiana
4
15
Sapodilla
Sofeda
Manilkara achras
--
--
Indian Goose Berry
Amloki
Phyllanthus embelica
--
--
Pomegranate
Dalim
Puncia granatum
--
--
Elephant Apple
Chalta
Dillenia indica
--
--
Carambola
Kamranga
Averrhoa carambola
--
--
Pineapple
Anaras
Ananas comosus
14
150
Watermelon
Tarmuj
Cucumis melo
12
100
Lemon
Lebu
Citrus limon
4
12
Other citrus fruits
--
--
3
8
Source BBS, Yearbook of Agriculture Statistics, 2006, 07-08

Porters Five Forces
A framework for diagnosing industry structure, built around five competitive forces that erode long-term industry average profitability. The industry structure framework can be applied at the level of the industry, the strategic group (or group of firms with similar strategies) or even the individual firm. Its ultimate function is to explain the sustainability of profits against bargaining and against direct and indirect competition.

FORCES
Criterias

Entry Barriers

Economies of scale
Proprietary product differences
Brand identity
Switching costs
Capital Requirements
Access to distribution
Absolute cost advantages
Proprietary learning curve
Access to necessary inputs
Proprietary low-cost product design
Government policy
Expected retaliation

Supplier Power

Differentiation of inputs
Switching costs of suppliers and firms in the industry
Presence of substitute inputs
Supplier concentration
Importance of volume to supplier
Cost relative to total purchases in the industry
Impact of inputs on cost or differentiation
Threat of forward integration relative to threat of backward integration by firms in the industry

Buyer Power

Bargaining Leverage

Buyer concentration versus firm concentration
Buyer volume
Buyer switching costs relative to firm switching costs
Buyer information
Ability to backward integrate
Substitute products
Pull-through
Price Sensitivity

Price / total purchases
Product differences
Brand identity
Impact on quality / performance
Buyers profits
Decision makers ' incentives

Existing competitors
(Rivalry Determinants)

Industry growth
Fixed (or storage) costs/value added
Intermittent over capacity
Product differences
Brand identity
Switching costs
Concentration and balance
Informational over complexity
Diversity of competitors
Corporate stakes
Exit barriers

Availability of substitute products
(Determinants of Substitution Threats)

Relative price performance of substitutes
Switching costs
Buyer propensity to substitute

SWOT Analysis:
SWOT analysis is a tool used by strategic planners and marketers to assess the competitive environment of a region, industry, business, or product. It is a very simple technique that focuses on the Strengths, Weaknesses, Opportunities, and Threats (SWOT) facing Tree-mendous Orchard, agriculture by asking the following questions:

i. What are the advantages of engaging in production agriculture in Tree-mendous Orchard? ii. What unique local conditions support the agricultural industry? iii. What do Tree-mendous Orchard farmers do well? iv. What do Tree-mendous Orchard farmers do poorly?
v. What can be improved in Tree-mendous Orchard agriculture? vi. What are key regional/industrial trends? vii. What are the options and obstacles facing Tree-mendous Orchard farmers? viii. How does Tree-mendus Orchard” /Six-seasons Orchard, agriculture fit within the regional context?

INTERNAL FACTORS

STRENGTH
WEAKNESS

Market Access
Location
Agricultural Diversification
Operator Characteristics
Distribution Infrastructure
Strength in Key Sub-Sectors
Availability of Workforce
Business Relocation Trends
Agriculture District
Devotion to the farm business
Land area and capacity with good soils
Well community and reputation for quality

High Land Costs
High Development Pressure
Diminishing Agricultural Infrastructure
Integration with General Economy
Inter- & Intra- Agency/Industry Conflict
Regulation/Policy – Country & Town
Leadership Development
High Tax Burden
Weather
Insects and wildlife
Disease
Lack of farm experience and new to farm production
Finances are limited due to property purchase and start up costs

EXTERNAL FACTORS
OPPORTUNITY
THREAT

New Market Development (Regional)
Business Retention, Expansion, Attraction Planning
Regionalism
Value-Added Products and Services
Agri-tourism Development
Management Skills Development
Labor Force Development
Public Outreach and Marketing
Farm Transition Programming

Development Patterns/Pressure
Regional Competitiveness
International Trade
Disposable income of consumers and what they are willing to pay for fruits
Loss of Agricultural Infrastructure
Inter-jurisdictional Competition
State Fiscal Conditions
Change in customer preferences
Price volatility
Lack of skilled labor
Injury or illness

CORE COMPETENCIES

It is the main strengths or strategic advantages of a business. Core competencies are the combination of pooled knowledge and technical capacities that allow a business to be competitive in the marketplace. Theoretically, a core competency should allow a company to expand into new end markets as well as provide a significant benefit to customers. It should also be hard for competitors to replicate.
1. They should make a disproportional contribution to stakeholder value
2. They should open doors to other opportunities
3. They should represent such a unique blend of tacit and explicit knowledge that it cannot be copied by competitors

Core Competencies

Company
Position

Orchard operations experience

Knowledge of best practice

Financial resource

Skilled personnel

Administrative resources

Technical skills / knowledge

Equipment / Services

Business base

Management infrastructure

Relationship with service providers

1
Effective utilization of company resources

Planning and organizational skills

Practical Orchard operations knowledge

Time-management skills – reliability

Proactive management focus

Decision making skills

Team management skills

Budgeting and financial management skills, relative to the Orchard business

Recognition of reporting lines

External regulatory requirements

Maintaining and promoting company image

Identification of new opportunities

Recognized industry qualification in Horticulture to advanced level

COMPETITTVE ADVANTAGE

It is an advantage that a firm has over its competitors, allowing it to generate greater sales or margins and/or retains more customers than its competition. There can be many types of competitive advantages including the firm 's cost structure, product offerings, distribution network and customer support.
Tree-mendus Orchard offers:

An on farm market location to sell at, on a very busy road
Market to restaurants on an order basis, access to many local products.
The Picnic Spot service is not offered by all local orchard farms
Accept all methods of payment, except Cheques.
Discount to bumper purchase of fruits, and picnic packages.

PRODUCT LIFECYLCE

It is the period of time over which the product is developed, brought to market and eventually removed from the market. First, the idea for a product undergoes research and development. If the idea is determined to be feasible and potentially profitable, the product will be produced, marketed and rolled out. Assuming the product becomes successful, its production will grow until the product becomes widely available. Eventually, demand for the product will decline and it will become obsolete.

The cultural life cycle lasts about 50 years and during 30 of them the production is full. By assessing the oranges life cycle, it has resulted that their production is the most impacting phase, causing, in fact, almost half of the total damage. It depends on this phase being characterized by high consumptions of non-renewable resources, such as water -principally for the irrigating process- and all the raw materials associated to the various cultivation treatments. Based on these results, the following solutions are proposed, in order to reduce, as much as possible, the total damage associated to the citrus field life cycle and, consequently, to the oranges: the water required for the field irrigating should be supplied by recycling it within a wetland plant;
Installing a photovoltaic plant to guarantee the electric energy consumption;
Adopt an organic farming system, rather than integrated, and

Avoiding the environmental impacts due to the use of chemical products (fertilizers, pesticides and herbicides).

These improvement proposals have not been detailed yet, since they are going to be object of another research, in order to understand if they are truly environmentally sustainable.

Additional Strategic Consideration
I. If anyone gets a "deal", it should be our loyal, long-term clientele. We will reward them by giving them first chance at any specials, discounts, etc.

II. We won 't cheat ourselves by lowering prices just to make a sale to someone who is simply trying to take advantage of us.

III. Excess product will not be wasted. Rather, we will use it as advertising "samples" and give it to customers who can use it. They will repay us many times over in "word of mouth" advertising. This may seem counter-productive, and is the exact opposite of what large retailers do who destroy millions of dollars worth of merchandise every year, but it has proven to be very helpful for us.

IV. We will give customers discounts or dividends for bringing in other customers or distributing our literature, etc. Give those who organize group orders a bonus.

V. Reward loyal customers with extra services that will help them succeed.

We will succeed only if our clientele succeeds. We will treat our customers as an extension of our "research" and "development" departments. Their problems and complaints about our products can help us eliminate future production problems and their suggestions may be as helpful as any 21 hired consultant. We will listen attentively to their concerns, dealing with problems immediately and always give the customer the benefit of the doubt

Market Overview
Potential Customers

Supermarkets
Since most fresh produce is sold through the major supermarket chains, an obvious way of getting local orchard produce to potential customers is to engage with local supermarket store managers. Consumers are keen to buy local orchard produce and would like to be able to buy it from a supermarket.

Beverage markets
At present Bangladesh has a very competitive market of beverage. Bangladesh has a relatively hot weather and people tend to be thirstier. So they prefer to take soft drinks most of the time. Fruit juices are becoming an important part of the modern diet in many communities. They are nutritious beverages and can play a significant part in a healthy diet because they offer good taste and a variety of nutrients found naturally in fruits. Juices are available in their natural concentrations or in processed forms. Here are some of the lists of beverage companies that produce orange juices.
Kohinoor Chemical Company Ltd. - Vita Fresh (Orange).
The ACME Agro vet & Beverages Ltd. -ACME Premium and Classic orange juices
Partex Group - Danish Fruit Juices.
Akij Group - Frutica
Pran Foods Ltd – Pran junior
Nestle - Nesfruta

Size and the growth of the market
Orange farming has been expanding fast in Panchagarh and Thakurgaon. Presently, there are over 80,000 orange trees in 93 orange orchards occupying 104 hectares of land in four upazilas in Panchagarh and for Thakurgaon the number of such trees is 30,000 in 48 hectares. Around 50 tonnes of orange are now produced annually in the districts and the amount will surely increase by 2012 to meet the local demand. Few years back, the number of people farming orange in orchards personally or commercially was very small.
Commercial cultivation of orange began in Thakurgaon as farmers achieved success in cultivating the nutritious fruit. Over 1,000 farmers have brought 50 hectares of land under orange cultivation under a project of Department of Agricultural Extension for expanding orange cultivation. DAE has undertaken a project for expanding orange cultivation in 10 districts, including Thakurgaon, involving 16 crore till 2011. The other districts are Panchagarh, Gazipur, Tangail Mymensingh, Chittagong, Cox 's Bazar, Rangamati, Khagrachhari and Bandarban. Project authority said 30,000 saplings were planted in 46 hectares of land in the district.
Farmers are turning their attention to orange cultivation in Panchagarh, a northern district with sandy, alluvial soil. The popular fruit has the potential to become a cash crop for farmers in the four upazilas of the Panchagarh. These oranges would hit the international market by 2012, after meeting domestic demand. About 100 hectares of land in different upazilas of Panchagarh have been marked for orange cultivation. An additional 100 hectares of land will be brought under orange cultivation, as the district is fixing the production target at about 500,000 tonnes. According to a 2003 survey, at least 1,450 hectares of land in four upazilas of the district are ideal for orange cultivation - 400 hectares in Tetulia, 400 hectares in Panchagarh, 300 hectares in Atwari and 350 hectares in Boda.

.Orange cultivation may be a very profitable occupation in Chittagong Hill Tracts (CHT). Many farmers in the hills now think like this seeing a bumper yield of the juicy sweet fruit for the last few years. Beginning about a decade ago, many orange orchard gardens have sprung up in Rangamati, Khagrachhari and Bandarban hills districts, sources said.
Two varieties of oranges are being cultivated in the CHT. One is Khasia, also called local orange and the other is Nagpuri, a hybrid orange of Indian origin. Demand for Nagpuri orange is higher than the Khasia. There are orange gardens in nine out of 10 upazilas in the district. The exception is Kawkhali upazila where such gardens are yet to be raised, they said. About 114 hectors of land on hill slopes have so far been brought under orange cultivation only in Rangamati.

Cultivation of orange is becoming a moneys pinner in Moulvibazar as farmers achieved steady growth in yield in the last few years. According to the Department of Agriculture Extension (DAE), more than 500 hectares of hilly lands in Juri and Baralekha upazilas have been brought under commercial orange cultivation this year. With a steady growth in orange cultivation and its yield in Moulvibazar district during the last few years, the total area under orange cultivation has increased to 494 acres from 59 acres while the average yield has risen to 3.75 tonnes from 3.50 tonnes per hectare. 70,000 of some 1 lakh 40 thousand trees in new and old orchards have yielded fruits, with each plant producing 160 pieces of orange in an average.

Orange can be an export item after meeting the home demand as there are vast areas in the country suitable for orange cultivation.

Strategic positioning for the orchard farm

We will evaluate our overall strategy as we seek to match our core competencies with the changing complexion of the marketplace. A number of alternative strategic options are possible.
Cost Leadership
Offer standard products and services to customers at the lowest competitive prices.
Differentiation
Focus on differentiation to offer a steady of new products to broadly defined markets that are national or international. The product offering will be above average market prices because of the extra value delivered by the differentiation innovations.
Coordination
Coordinator firms work to develop unique marketing channels linking suppliers and customers. The competitive advantage of coordinating firms can stem from the special relationships we will cultivate with their suppliers and customers.
Focus/Niche
The focus on a specific set of customers limits the appeal of the offering to a relatively small market but has the advantage that the solutions are so well tailored to this customer group that competitors are effectively locked out of the niche.

Strategic orientation

Thinking strategically will become increasingly important for the successful of our farm in the future. The strategic thinking process leverages an understanding of the strengths and weaknesses of the business leading to an identification of the core competencies and capabilities to respond to the opportunities and threats provided by the external environment. Only by understanding internal capacities and the external environment we can analyze the strategic positioning options available to the business. Choosing a strategic position of low-cost leader, differentiator, coordinator, or niche-focused customizer based on this analysis provides us with a fundamental direction for the farm business that can shape its ability to create value for its customers. And that is what our farm will be in the future, a business that understands customers and determines how to create value for those customers through products and services that provide a long-term sustainable competitive advantage through a low-cost, differentiation, coordination, or customization strategy.

OVERALL STRATEGY

Short-term
The objectives over the next three years for our farms are:
Achieve profitability in one year
Expand by purchasing an additional 50 acres of adjacent land by year three
Capitalize on the niche market for hybrid and specialty orange fruits
Increase yield per acre to achieve economies of scale

Long-term
We will strive to:
Become first to market through use of early harvest varieties of oranges
Focus on marketing of hybrids to local distributors
Aggressively pursue cost analysis and reduction
Concentration on post harvest care of produce to enhance quality
Market to the high end local produce stands that can demand higher prices
Capitalize on close contacts to universities Agricultural department faculty to introduce new scientific methods and procedures to growing oranges.
Enhance and stabilize production
Increase access to markets
Generate employment opportunities
Minimize the risks to production
To keep expenses to a minimum

Company Value chain Analysis and Operational plan

The Value Chain- it is a framework for identifying core competencies:
• Inside the firm
• In the supply chain
It can be used to:
• Identify strengths and weaknesses
• Identify sources of competitive advantage
• Identify market opportunities

Value Chain Analysis:
A firm’s value chain must be compared to competitors’ value chains to determine where competitive advantages exist. Also to be a source of competitive advantage a resource or capability must allow a firm to:
• Perform an activity in a manner that is superior to competitor’s performances
• Perform a value-creating activity that competitors cannot complete.

Core Competencies
Core competencies are the key to developing a successful business strategy i.e. a competitive advantage. A core competency must be unique to the firm to create a sustainable competitive advantage.
Core Competencies are the end result of deploying resources using the firm’s capabilities. Primary base for the firm’s capabilities is the skills and knowledge of its employees.

Identifying and Building Core Competencies:
• Core competencies must be distinctive.
• Capabilities that are done better than competitors
• Identifying core competencies is key to development of sound strategy.

Table: Criteria for identifying a core competency

A flexible work schedule and the ownership of advanced vehicles and equipments can allow us to create value for customers by delivering oranges with only a few hours notice.

We want to develop and exploit capabilities that differ from those possessed by competitors.

We will develop costly-to-imitate resources and capabilities that competitors would have a difficult time developing because they will require a large capital outlay or a long period of time to develop.

We will build trust-based working relationship with buyers or processors as it takes time to develop, are many times hard for competitors to recognize, and have very few close substitutes for gaining the same advantage.

One method that is useful for identifying the resources and capabilities of the farm business and contemplating their potential for providing a competitive advantage is the value plate.

Figure1: The Value Plate
The value plate is a framework for identifying the activities the firm conducts to create value. Figure 1 depicts the activities that a business might perform to development and deliver a product or service. This value plate will reflect our business strategy and industry economics. The value our business will create is, generally, the amount that buyers are willing to pay for what we provide. The size of the external boundary of the plate represents the total value the farm creates for its customers. For our business, it will be measured in total revenue. The individual boxes within the boundaries represent the activities performed and the cost of performing those activities. Our business will be profitable only if the total revenue exceeds the costs required to create your product. The difference between the value activities (expenses) we will perform and the value we will create (total revenue) is the margin.

We will want the size of each individual activity box to be as small as possible, while having the overall value plate as large as possible. Those activities that our firm does at the lowest cost relative to the value created, vis-à-vis their competitors, give us a better chance of achieving a competitive advantage. Business activities are combined into two broad classes: primary activities and supporting activities. Primary activities will physically create and service our product. Secondary activities will support the primary activities by providing the business-wide functions.

Primary Activities in the Value Chain
This represents the general primary activities the farm undertakes to produce goods or services. These activities consist of supplier relationships (inbound logistics), operations, and customer relationships (outbound logistics, marketing and sales, and service).
I. Supplier Relationships:
Inbound logistics are concerned with the way in which physical inputs are received and stored. Inbound logistics activities include fertilizer delivery direct from the retailer, on-farm fuel storage, and custom application of inputs. These activities are important to the product or service processes that the farm business is trying to create.
II. Operations:
Operational activities are the physical activities carried out in the production of the product or service. These are the tillage, planting, fertilizing, spraying, harvesting, breeding, and feeding activities which is known as farming. The way in which those operations are conducted and/or sequenced may prove to be the key to the farm’s competitive advantage. The types and timing of operations can provide a key strategic advantage in the quality of the final product in crop production and may be an important source of yield or cost competitive advantage.

III. Customer Relationships:
The next three primary activities include a set of relationships with customers known as “downstream value activities.” These activities can serve as a source of sustainable competitive advantage when used to create a special relationship with the customer that benefits the customer either through additional value in the product or reduction in the customer’s costs of using the product or service.
IV. Outbound Logistics:
Outbound logistics focus on the collection, handling, storage, and delivery of the completed product or service.
Create value by undertaking activities that assure quality or purity of the finished product or creating relationships with intermediaries such as wholesalers or retailers to store and deliver the product to the customer on time.

V. Marketing and Sales:
• Provide means through which customers can purchase products and to induce them to do so.
• Advertising, communicating with buyers, developing customer relationships, pricing products and delivery scheduling.

VI. Service:
• Activities designed to enhance or maintain a product’s value
• Timely delivery, identity preservation, certifying as organic, etc

Supporting Activities in the Value Chain
These activities consist of the firm infrastructure, human resource management, technology development, and procurement. Each of these functions is necessary for successfully completing the primary activities.
Firm Infrastructure
General Management, planning, finance, accounting, legal support, governmental relations, etc.
This function is important in making sure the business stays focused on its goals and objectives, and that activities, core to the success of the firm’s strategy, are carried out in a superior fashion.

Human Resource Management
• Recruiting, hiring, training, developing, and compensating all personnel
• Establishment of accounting practices, management information systems, compliance with environmental regulations, tracking and reporting for government programs, etc.
• Strategy development takes place identifying opportunities and threats, resources and capabilities, and support of core competencies

Technology Development
Activities that improve the firm’s products and/or processes
This may include investments in research and development, such as on-farm tests to improve production processes or product characteristics.

Procurement
• Activities to purchase the inputs needed to produce products
• Negotiating with suppliers, standard timing of replenishing parts and tools setting up buying groups etc.

Margin- the result of the Value Chain

• Capture the value from performing value-creating activities as cheaply as possible
• The size of the individual activity boxes represents the cost of performing those particular activities.
• The smaller the size of the individual activity boxes relative to the value the consumer is willing to pay, the greater the margin will be for the firm.

The Supply Chain
The flow of oranges from farmer to consumer can be explained in the following way.
1. Farmer – Collection Center – Commission Agent – Wholesaler – Retailer – Consumer
2. Farmer – Cooperatives – Commission Agent – Wholesaler – Pushcart Trader/Retailer
– Consumer
3. Farmer Trader – Commission Agent – Wholesaler – Retailer – Consumer
4. Farmer Trader – Wholesaler – Street Vendor/Retailer – Consumer

5. Farmer – Middlemen– Retailer – Consumer
6. Farmer – Middlemen – Wholesaler – Commission Agent -Retailer – Consumer

Operational plan
We need careful planning and strategizing at the start. This plan includes all important and necessary matters to the farm. Having a definite plan will give us an overall outlook regarding the business, together with possible problems, which may be encountered. It involves the startup cost for the fruit farming business, the place to start planting the orchard, the equipment necessary for farming and transporting the fruits, the market, the needs of buyers and the existing fruit farming business competitors.

One of the most important elements of our business is the land. Choosing the right location for our orchard will greatly affect the growth and production of our business. Several factors must be considered in choosing the land to plant the orchard. This includes the type of soil, the soil’s PH, exposure to sunlight and source of water.

The operations plan is a description of the farm itself, and how it is run. It includes details about: the land, buildings and facilities equipment, vehicles and machinery used on the farm materials and supplies what is produced and when plans for new facilities any environmental assessment plans, e.g. for soil conservation or to improve water quality relevant regulations and licenses

Location
Our orange Orchard will be located to a river nearby. The attractiveness of this location in full bloom during the summer months will provide some natural marketing advantages. The river also has some direct benefits for the orchard. The soils are very fertile due to the enrichment of nutrients in the valley’s soils. This, as well as, the constant supply of fresh river water within these soils allows the trees to produce fresh, fully developed fruit. During periods of drought, the river also provides ample water for irrigation. In addition, the valley provides some protection to the fruit trees from the elements, particularly over the winter months. This scenic environment is a huge asset as it will add to the atmosphere that can help market our business.
Customers can enjoy a unique experience learning about and picking delicious oranges and perhaps having a picnic or a stroll through the serene and picturesque environment offered by our Orchard.

Building layout and site plan
There overall landscape of the land will contain four main buildings.
1. The main storage/refrigeration facility. This is where most of the orange products will be stored at various times of the year, as well as various machines/equipment.
2. The residence. Employees will be living on-site as to attend to the orchard when needed.
3. The Orchard. Which extends out 5 acres, but it will be expanding in the following years as the orchard grows.
4. The Greenhouse. It is used to produce a variety of landscape enriching plants and greenery.

Product overview
Product: Fruit production (orange- mandarin)
There are many different hybrids or varieties of Mandarins. The flavor of the fruit ranges from sprightly sweet to nearly spicy. Some are seedless while others full of them. The fruits also vary in size and colour. Tangerines, for example, are the brightly-coloured version of Mandarins. Due to the great variety, there were probably differences in the early classification of the fruits, resulting in other scientific names for Mandarin oranges like Citrus nobilis, Citrus deliciosa and Citrus chrysocarpa. The most distinctive feature of all Mandarin oranges is its peelable skin. The fruits of Citrus reticulata have a very loose skin that is so easy to peel that they are called kid-glove or loose-skin oranges.
The fruit is high in Vitamin C and its juice is a popular drink.

Usage and potential

a. Food: A good source of vitamins and minerals, the fruit is often consumed fresh. It can also be canned in syrup or made into juice. The fruit and the rind are used to flavour cakes, pastries, gelatines, puddings, chewing gum, bakery products, and tea. Mandarin oil is used to flavour carbonated beverages.
b. Medicine: Essential oils obtained by cold compression of the peel are used in aromatherapy and traditional medicine for the treatment of insomnia, and skin and digestive problems. Different varieties of the fruit and parts of the plant, such as seeds, roots, leaves and flowers are used in Chinese, Malay and Indian traditional medicine. Petitgrain mandarin oil is obtained from distilling leaves, twigs and unripe fruits of the plant. The fruit being high in Vitamin C, is considered good for the immune system. It is supposed to help combat phlegm and keeps colds at bay. Some varieties of the fruit contain a decongestant called synephrine.
c. Other uses: Some of the essential oils obtained from the peel is used in the manufacture of perfumes, cologne and floral compounds.

Description
Mandarin trees are low woody shrubs commonly measuring between 3.6 to 4.5 m high. However, these spiny trees can sometimes grow up to 8 m tall. The bark is rather thick and brownish yellow in colour. Older twigs are dark brown while younger twigs are dark green. Younger twigs are also smooth and flattened at their ends. The leaves are lanceolate or elliptic, with a yellow-green undersurface. They measure 2.5 to 10 cm long and 1 to 3.5 cm wide. The margins of the leaves are toothed from the apex to the middle of the leaf. The leaf stalks do not normally have wings, but if present, they are narrow. Flowers are white and small (about 1.5 cm in diameter) with 5 petals. They grow singly or in a group of 2-3 flowers in a stalk at leaf corners. Mandarin fruits are globose to oblate in shape with a shiny skin that can come in a range of colours from green, greenish yellow, yellow to golden. The skin is thin, peels easily and encloses flesh that is separated in 9 to 15 segments. The segments are covered with a very thin, edible transparent skin. The flesh is pale orange in colour and juicy. Seeds, if present, are small, oblong and inedible.

Service overview
Picnic and camping areas will be provided to encourage family participation, catering for picnic customers and reservation of trees and garden in the premises. Special birthday parties for children will be held. Will provide the best of experience through activities such as boat riding, horse riding, bird watching, fishing and many other fun – filled recreational activities.

Facilities
There are very few items required for the operation of our Orchard that will require stringent supply management. All materials such as Rootstocks, irrigation pipe, plastic packs, labels and bags used for irrigation, orchard development and maintenance, or orange storage will be available from multiple sources of suppliers.
The storage facility will provide the orchard with proper cooling and storing capabilities. Within this building there will be a cooler to provide refrigeration of the recently harvested apples that will be sold to customers. The area will also contain much of the needed equipment for maintaining the orchard. The building will be fully insulated and will have concrete foundation. It will be heated electrically through baseboard heaters that are located around the inside base of the building and have a direct water supply. The freezer and cooler will be chilled by the use of two compressor units, in order to provide adequate refrigeration at two distinctively different temperatures.

Equipments
The most common and basic tools needed are air-blast sprayer, small tractor, mower, pull behinds and carts. The air-blast sprayer is for fungicide, insecticide and application of plant growth regulator. The tractor on the other hand should be small enough to run around the trees in the orchard. A 30-60 hp tractor is sufficient for small farms. A cart or small truck is also necessary to transport the harvest from the farm to the storage area, and also to the market and other fruit farming business clients.

Production process
The key to having a successful orange orchard is producing a high-quality harvest. Hedging, weeding and fertilizing are of the utmost importance, as is providing the proper micronutrients.
Irrigation
Irrigation is provided at an interval of 10-15 days during winter months whereas during summer months it is provided at an interval of 5-7 days.
Drip Irrigation:
Water requirement of citrus trees is generally higher than most of the other sub-tropical fruits due to recurrent growth and development. The water requirement varies from 900 to 1100 mm. per year depending upon the location. Water requirement of young (1-4 years old), middle (5-8 years old) and mature (9 and more) Nagpur mandarin trees varies from 5 to 15 litres/day, 35 to 105 litres/day and 60 to 170 litres/day respectively. Advantages of drip irrigation : Drip irrigation leads to effective, efficient and economic use of irrigation water and is recommended specially in low rainfall regions of Maharashtra, MP and Rajasthan which are some of the major producing areas. The advantages of using this technology are : Ø Irrigation is controlled as per requirement of evapotranspiration needs.
Ø Water is applied directly to the root region of the crop.
Ø Improvement in plant growth , yield and quality.
Ø High efficiency in water application and use.
Ø Water saved compared to flood irrigation is 50-60%.
Ø High fertilizer use efficiency.
Ø Conservation of soil, water and nutrients.
Ø Land leveling work is minimized.
Ø Minimum incidence of insect, pest and disease.
Ø Continuous cultural operations are possible.
Ø Weed infestation is reduced.
Ø Minimum labour requirement. Training & Pruning
Trees are trained to single stem with 4-6 well-spaced branches for making the basic framework. The lowermost branches are not allowed to grow below the height of 50 cm. from the soil surface.

Pruning is done during the initial years of planting. The bearing trees require little or no pruning. Main objective of pruning the bearing trees is to maintain the framework and to secure higher yields with better quality fruits. Pruning of bearing trees though differs with variety but chiefly consists of removal of dead, diseased, criss-crossed and weak branches. Removal of water sprouts and suckers of rootstocks is also highly essential. Pruning of non-bearing trees can be done at any time of the year, but for bearing trees the best time is after harvesting, during late winter or early spring when these are in somewhat dormant stage. Root pruning is also practiced in some parts of central and southern India to regulate flowering season. Intercultural Operations Pre-emergence herbicides (Diuron @ 3 kg./ha. or Simazine @ 4 kg./ha.) should be sprayed twice at an interval of 120 days from the last week of May for effective and economical control of dicot and monocot weeds in the orchard. Mulching
Application of dry leaf mulch or paddy husk to a thickness of about 8 cm. in the basin keeps down the weed growth and decreases the number of irrigations and also improves fruit quality. Inter-cropping
Intercrops viz. pea, cowpea and gram can be taken in mandarin orchards.
Pest and disease management
Integrated pest and disease management (IPDM) is an approach to pest and disease management that utilizes a range of techniques intended to reduce economic damage. We can reduce the impact of pests by manipulating cultural practices. Some of the strategies employed include the following.
• Rotate crops when planting a new orchard
• Cultivate the soil to disrupt the life-
• Vary the harvest time.
• Vary crop spacing.
• Prune crops.
• Keep orchards clean. Remove pest breeding and hibernating sites by removing, destroying or composting old or fallen fruit.

The flow of work at the orchard is very efficient due to its layout and design. The orchard will currently have 2100 apple trees planted on three acres of land, with plans to plant an additional 750 trees in 4 years. There are additional plots of 2.5 and 6 acres available for further orchard expansion. The orange trees will be spaced approximately 4 feet apart from each other within the rows with 10 feet between alleyways within the rows.
Once the fruit is ripe, the oranges will be picked and stored in the refrigeration room and eventually sold to consumer or retailer.

Research and development
The general management of orange orchards is still very basic. In most instances, trees are grown under natural conditions with very minimum added inputs. Awareness regarding fertilization and pruning is limited. The production is further affected by pests accounting for loss a lot of the fruits. Specific focus on research and extension for orchard management is critical to enhance productivity.
The focus of research should be more on genetic technologies than non-genetic aspects. There is a need to visit the farms and conduct a study at the ground level. Accordingly, the findings from these should be the focus of the research.

Marketing Plan
Sales Plan

Since we intend to have an increasing market share growth rate, we will plan accordingly to make sure that our sales is increasing proportionately. We will give benefits of purchasing with Mastercard, American Express and Visa Card and also allow small firms to purchase on credit. This will improve the relationship with our customers and increase their satisfaction. The sales team will also play an effective role in determining sales since they are the ones who inform the customer about the products and make them aware about the benefits of those products. We will have special membership cards for those who will buy our furniture. We will give 5% discount of every stationery supplies that they buy. This will help us increase our number of loyal customers.

Target Market

Target market for Tree-mendous Orchard:

Target Market is important for any business. Our target market is also very important for us. We will take all initiative to satisfy our target Customers. Our target customers are both Local and international. We will sell them Product directly and indirectly.
Our Target customer for Tree-mendous Orchard will be:
Whole seller of Fruit seller throughout the country.
Super stores
Some selective direct customers
Local Fruit Exporter
International orange Buyers

Target market for Tree-mendous Orchard Picnic spot:
The Orchard has different target customers. For this business we have different target customers group. We also rent picnic spot. They will be connected directly. We will have different policy for this business. Our Target customers for Tree-mendous Orchard are:

Individual person use for Picnic Spot.
Official Persons Use for official Picnic
Educational institutional Picnic Spot
Social gathering for local and national people

What are the Specialities for our Target customers:
There are approximately 85,000 people in a 60 mile radius of the farm. With a growing population.
The average family size is 2.5 and the median household income is over 5,000.
More families are health conscious and seeking healthy foods.
People need fruits out of any poison, formalin, carbaid etc. We will provide all poison free fruit to our customers.
Increasing interest in local foods and resources.
There was also a strong interest in quality small fruits. Most wholeseller would pay a 10-20% premium for fresh products.
Healthy families and high end whooleseller and superstores are interested in locally grown produce.
Healthy families will be reached through farm market sales. Tree-mendous Orchard will have a weekly spot at the local farmers market We will attend when our products are available

Pricing Strategy

The amount of money charged for a product and service or the sum of the values that customers exchange of the benefits of having or using the product or service. The Price will be determined by the value offered by the product.
Our price list for our orange product is given bellow:

Pricing Policy for Tree-mendous Picnic spot

For Six-seasons Orchard we have plan for giving them best and competative price than our competitors. We will provide them less price than our competitors. We will give rent for a day for two or three. They can book the spot in early period. We will provide any catering services for them. We will give discount for special case of booking. Our price list is:

Distribution System for Tree-mendous Orchard (Orange)

Figure : Our Distribution Channel

Since we will be collecting orange directly from garden we have to process them and the things that we will be selling, we will need a Coldstorage to keep the products. The Coldstorage will need a good security system, with automated locks and alarm system. Near the Coldstorage, we will have a place for assembling and packaging. There employees will package the orange. Well package of Orange leads transport and lower purchase cost. The final products will reach the customer in the showroom. We will have a very efficiently built showroom which will place the Product in the best position to show their features and functions. At one corner of the showroom, we will have recreation segments, where everything will be displayed attractively. And Customer can refresh their minds.

Quality assurance:
We will choose our Collect fruits for the garden very carefully and our employees will go personally to inspect the quality of the fruit that we will be cellecting. And after that the defected one will be removed from the proccesing departement. And We will carefully store them in the clod storage. We will try best to ensure the best quality fruits for our customers.

Promotional Strategy:
Tree-mendous Orchard will be using Integrated Marketing Communication which will help its products to develop a consistent, clear and compelling message which will be in sync with products positioning strategy.

Advertising Plan
As a new company, we will do mass advertising to make sure that our name has been heard or read by everyone. Very few orchard business do intensive advertising so Tree-mendous Orchard will be easily noticed when advertised at such a mass level. The advertisements will emphasize on our combination of reasonable price and good quality products. From time to time we can also promote our name by giving offers such as discounts during Eid, New Year, etc. We will offer bulk buying discounts, price-pack deals, checkout dispensers from time to time.

Print media:
In the print media we will mainly use Newspaper advertisements to announce our launching because they are flexible, has a wide coverage and broad acceptability. From time to time we can also give our leaflets and catalogues with the newspaper. Along with newpapers, we will also advertise in business and life style or Food related magazines.

Electronic Media:
Tree-mendous Orchard will have its own website where all of its product, features, and prices will be listed.
It is one of the most effective means as Internet has become a necessity for all. By the use of this medium an interactive means of advertising can be created which can influence consumers to a greater extent. For instance, advertisements in the Face book or sending e-mails to potential customers are likely to be very useful.
Most importantly we will use Television commercials to emphasize our arrival in the market as this is likely to catch significant attention. Television has a good mass marketing coverage and scan appeal to the senses by combining sound, motion and sight.
We will go for advertisement through different Radio channels during the peak hours which will help us target fresh graduates who are opening their own businesses. Most of them will have limited finances but their taste and budget will match with our product line for sure.

Display Media:
Here Tree-mendous Orchard will use billboards, banners and posters to convey our arrival. These media forms have been chosen because of its flexibility, good positional selectivity and high repeat exposure.

Customer Service

Customer service is the provision of service to customers before, during and after a purchase. Its importance varies by products, industry and customer; defective or broken merchandise can be exchanged, often only with a receipt and within a specified time frame. We are very serious about Customer Service. Our some Customer Service options are:
24/7 Call Centre: For our valuable customer we will provide 24/7 customer call centre support. They can contact with us any time at ant means. For their emergency they can contact with us immediately. For their any inquiry they can also make communication with us.

Website: For our valuable customers we will provide website. From the website they can know about our self. They can also have knowledge about our products and services. They can also give us order through website. By the website they can provide feedback also. All of our information, update, news. Views, events everything will be available in our website.

Sales return and Allowance Department: We have a department for our sales return and allowance the department will analysis the customer’s sales returns. And they will take fast initiative to give the customers sales return for our fault. We will refund their money back also for our fault.

Fast replacement: We will replace our products as soon as possible. After getting notice for replacement or return to our customers we will give them as soon as possible.

Rating System: According to our service our customers will be provided a form for rating us. By this feedback we can improve our systems, Strategies etc.

Training for Customer Service Employees: We will provide high level integrated training for Customer Service Employees. So that they can provide best service to our valuable customers.

These Skills will be our Customers Service We will train our employees highly for these.

HUMAN RESOURCE STRATEGY

HR Management Policies:

Human resource policies are systems of codified decisions, established by an organization, to support administrative personnel functions, performance management, employee relations and resource planning.

HR policies provide an organization with a mechanism to manage risk by staying up to date with current trends in employment standards and legislation.
The policies must be framed in a manner that the companies vision & the human resource helping the company to achieve it or work towards it are at all levels benefited and at the same time not deviated from their main objective.
Emplyee Selection Process: To assign people in our organization we will use the following devices-

Figure : Employee selection process

Figure : HR Management Process

Training :
We will provide the following training to all the members-
Interpersonal skill training
Mandatory training
Performance Management training
Personal training
Beside those training we will provide the technical training to those who are related to technical side. For example using cash registar machine to a cashier. We will also provide the business training, problem solving & decision making training to the managers.

To get the best services, we will ask them to work as a team. They will have the full power of selecting team members. But the team have to be effective. The team will be effective when the team has the following-
Clear goal
Relevant skill
Mutual trust
Unified commitment
Good communication
When a team is effective, that team will give us the best services. When all of the team will be effective, that will be the strong employee power of an organization.

Motivating :
We will motivate our employee to give us the best service.

From here we can say that, no need is ever fully satisfied, a substantially satisfied need will no longer motivate an individual. That’s why, motivating someone, we need to understand what level that person is on in the hierarchy & focus on satisfying needs at or above that level.

Staff Requirements For our organization we need total 60 members. Here is the department wise quantity of members.

Particulars
Member(s)
CEO
1
Deaprtment Head
6
Every Department need 1 Executive
6
Finance Department employees needed
3
Marketing Department employees needed
5
HR Department employees needed
3
Administrative Department employees needed
10
Sales & Customer service Department employees needed
10
Inventory Department emploees needed
3
Cleaners, Guard & Labor
13
Total Needed
60

The six members of our group will be in charge of each the six departments: Finance, Marketing, Human Resource, Administration, Sales, and Inventory. We will assign people to our organization according to our HR management policies. In the future, using sales forecasts, we can work out the required level of staff & increase our required level.

All our employees have to fulfill the Big Five Model requirements. And the Big five model is-
1. Extraversion - sociable, talkative, assertive
2. Agreeableness – good natured, cooperative, trusting
3. Consciousness – responsible, dependable, achievement oriented
4. Openness to experience – imaginative, sensitive
5. Emotional stability – calm, secure
After matching the job specifications, those who can fullfill the Big Five Model requirements, they will be assigned to our organization.

STRUCTURE An organizational chart is a diagram that shows the structure of an organization and the relationships and relative ranks of its parts and positions. The organogram of our company is-

Figure : Organogram of Tree-mendous Orchard

As Executives are the lowest levels (Operation Level) of management, they will directly meet our customers & they will sell products to them. And in Functional Level there are five managers, these managers will manage the work of operation level officers. In Business Level, there will be our CEO, who will be responsible for making organization-wide decision & he/she will establish the plan and goals that will affect our Tree-mendous Orchard

For communicating with any members of our organization, we will follow the Informal Communication system. Because it is not defined by the organization’s structural hierarchy & it will save our time to make any decision or giving any order to employee.

EXPECTATION

Compensation and Benefits for Temporary Employees:

Basic salary :
Tree-mendous Orchard has basic salary plan for their temporary employee. They get same salary in every month as they are hired for a project. Their salary doesn’t increase here.
House rent :
Temporary employees get monthly a fixed amount of money for their house rent.

Medical :
Employees get free medical checkup facilities from the company. Transportation facilities :
Temporary employees also get transportation facilities from the company.

Permanent Employee :
Permanent employees at Tree-mendous Orchard are those who are regular in the job and will be working for the firm whether there is any project or not. These are the people who are responsible to keep the firm aligned. Their compensation and benefits are the most rich as they are expected to continue their jobs in Tree-mendous Orchard for a long period.

Compensation and Benefits for Permanent Employers:

Figure: Compensation for Tree-mendous Orchard’s Permanent Employee

Risk Analysis
Risk analysis is a technique to identify and assess factors that may jeopardize the success of a project or achieving a goal. This technique also helps to define preventive measures to reduce the probability of these factors from occurring and identify countermeasures to successfully deal with these constraints when they develop to avert possible negative effects on the competitiveness of the company.

Foreseeable risk:
This is kind of risk is predictable. We can prevent or take proper steps to overcome these risks. In our business we have different foreseeable risk they are given bellow:
Competitive strategic Risk

Price of Raw materials or other materials

Wages of the employers

Lower price than our competitors

Quantity of Sales

Quantity of Productions.

Unforeseeable risk: This kind of risk we can not predict. Sometimes we can not take much initiatives for these risks. These risk can be happened suddenly. We will not prepare for these risk these risk are:
Bad Weather Condition

Inflation rate

Economic condition

Political condition

FINANCIAL MANAGEMENT

Assumptions

Land.
The farm consists of 65 acres. Mature orange trees are on 60 acres and the remaining five acres are roads, equipment and shop area, and homestead Land.
Land values for row crop land tk.750,000 per acre (Trends & Leases),

Returns.
An estimated price based on current returns (2011-12) of tk.2250 per carton.
The trees are planted on 18 X 22-foot spacing, 110 trees per acre. Approximately 120 cartons will be produced in per acre. Tree spacing and densities in orchards vary.
The life of the orchard is assumed to be 40 years.
Addition to this the picnic spot per visit will be charged tk.20000 and it is estimated that 20 visits or reservation per year will take place.

Cost of Project & Means of Financing
Project Cost: Unit one Acre (Amount in Tk.)
Sl. No.
Component
Proposed Expenditure
1.
Cultivation Expenses

(i)
Cost of planting material
3,000

(ii)
Manures & fertilizers
6,900

(iii)
Insecticides & pesticides
4,000

(iv)
Cost of Labour
12,500

(v)
Others, if any (Power)
3,600

30,000
2.
Irrigation

(i)
Tube-well/submersible pump
45,000

(ii)
Cost of Pipeline
-

(iii)
Others, if any, please specify
-

45,000
3.
Drip Irrigation System & including fertigation
26,500
4.
Infrastructure

(i)
Store & Pump House
30,000

(ii)
Labour Shed
5,000

(iii)
Agriculture Equipments
5,000

40,000
5.
Land Development

(i)
Land Leveling
4,000

(ii)
Fencing
29,500

33,500
6.

Land, if newly purchased (Please indicate the year)
@

Grand Total
1,75000

Financial statement of orchard for the year 2013-2017
Income statement (all the calculation are based on per acre production)

Details
Per acre
Y1

Y2

Y3

Y4

Y5

Sales revenue
(including all other revenue)
Less cost of production
(tab-1)

Gross Profit
Less other expenses:
Salary of office worker
(for first 4 years 5 and after that 15 worker@ 15000 per month)
Wages of labor
(includes part time labor)
Electricity bill
Remuneration of the directors
Depreciation of building
Depreciation of machine
Depreciation of leased machine
Depreciation of installation
Depreciation of van
Bad debt (2% of total A/R)
Other expenses
Income tax
Net income
6666

(33735)
6666

(3295)

6666

(2672)

62916

(5427)

276666

(7578)

(27068)

13846

21000

3222
-------
1100
3500
4200
1250
9000

1320

3371

13846

21000

3230
------
1100
3500
4200
1250
9000

1320

3994

13846

21000

3420
--------
1100
3500
4200
1250
9000

1320

57489

13846

21000

9230
---------
1100
3500
4200
1250
9000
750
1320

269088

27691

21000

9230
12000
1100
3500
4200
1250
9000
2160
1320

(85506)
(52435)
(54624)
(7707)
176687

Cost of production per acre
Details
Y1
Y2
Y3
Y4
Y5
Planting cost
Land preparation
Trees(110*220)
Re-plant 5% tree in y2
Plant, Layout, Stake & Wrap Trees

2300
24200

5500

1210

175

Total planting cost
32000
1385

Cultural cost
Sucker
Irrigate
Frost protection
Fertilizer
Disease
Consultant service fee

150
255
155
75

1100

175
325
200
110

1100

210
540
670
97
55
1100

255
1092
1120
1210
65
1100

325
1255
1295
1322
88
1100
Total cultural cost
1735
1910
2672
4842
5385
Harvesting cost
Pick
Pack assessment 220
320
45

950
1167
76
Total harvesting cost

585
2193
Total cost of production
33735
3295
2672
5427
7578

Balance sheet for five years (per acre)
Details
Y1
Y2
Y3
Y4
Y5

Non-current asset
Land
Machine(N.B.V)
Building(N.B.V)
Motor van(N.B.V)
Leased machine(N.B.V)

1000000
75000
71000

42000

1000000
70000
68000

39000

1000000
65000
60000

34000

1000000
60000
55000

30000

1000000
55000
50000

26000

Total non-current assets

1188000

1177000

1159000

1145000

1131000
Current assets
Accounts receivable
Inventory(raw mat.)
Cash at bank
Inventory(final product)

…….

2350

12300

…….

2480

…….

………

3120

……..

22500

1210

16700

108000

1130

120000

Total current assets
14650

2480

3120

40410

229130

Current liability
Accounts payable
Interest payable (to the share holders)
Bank over draft

15400
85000

…….

24000
85000

22300

18000
85000

39700

9500
85000

……….

5500
85000

……….

Total current liability
100400

131300

142700

94500

90500

Working capital

(85750)

(128820)

(139580)

(540900)

138630
Net assets

1102250

1048108

1019420

604100

1269630
Financed by
Investment by directors
Net income

1187756

(85506)

1100543

(52435)

1074044

(54624)

611807

(7707)

1092943

176687

1102250

1048108

1019420

604100

1269630

Ratio analysis
Ratio
Y1
Y2
Y3
Y4
Y5
Current ratio
Current asset
Current liability

0.14

0.018

0.021

0.43

2.53
Cash ratio
Cash
Current liability

0.023

0.018

0.021

0.013

0.124
Return on capital employed
Net income
Capital employed

-0.071

-0.047

-0.051

-0.013

0.162

Break-even Point: The break even point will be reached in the 3rd year. At this point fixed cost would work out to 73% of gross sales

Asset Management Ratio
Profitability is affected by the way that the assets of a business are used. If plant and machinery are used only for a few hours a day, the business is failing to utilize these assets efficiently. This may because there is limited demand for the product produced. It could be due to the business restricting supply in order to maximize profitability per unit produced. On the other hand, it could be that there is a shortage of skilled labor and that there is no one to operate the plant and machinery the rest of the time.
Asset management Ratio
Ratios
Y- 1
Y-2
Y-3
Y-4
y-5 Average
Standard Dev

Inventory turnover 6.22 6.27 5.73
4.85
8.63 6.34
1.40328491

Total Asset Turnover 1.02 0.98 0.93
0.93
1.09 0.99
0.068252957

Fixed Asset Turnover 1.95 1.87 1.96
2.01
2.03 1.96
0.064249734

Days Sales outstanding 75 73 44
56
40 57.59
16.08293089

Average payment Period
15
14
18
53
34
27.15
16.68208073

Debt Management Ratio
The third series of ratios in this tutorial are debt ratios. These ratios give users a general idea of the company 's overall debt load as well as its mix of equity and debt. Debt ratios can be used to determine the overall level of financial risk a company and its shareholders face. In general, the greater the amount of debt held by a company the greater the financial risk of bankruptcy.
While it is not mandatory in understanding the individual debt ratios, it will give some background information on the debt of a company. The ratios covered in this section include the debt to asset ratio, which is gives a general idea of a company 's financial leverage as does the debt-to-equity ratio. While the interest coverage ratio show how well a company can meet its obligations

Debt management
Ratios
y-1 y-2 y-3 y-4 y-5 Average
Standard Dev

Debt to asset 0.37 0.43 0.39
0.43
0.47 0.42
0.037803067

Deb to equity 0.59 0.74 0.65
0.77
0.88 0.72
0.112250494

Times interest Earned 4.85 4.58 2.84
3.38
3.62 3.85
0.842109161
Table: Debt Management Ratios of Tree-mendous orchard

Profitability Ratio
This section of the tutorial discusses the different measures of corporate profitability and financial performance. These ratios, much like the operational performance ratios, give users a good understanding of how well the company utilized its resources in generating profit and shareholder value.
The long-term profitability of a company is vital for both the survivability of the company as well as the benefit received by shareholders. It is these ratios that can give insight into the all important "profit".
Profitability Ratio
Ratio
y-1 y-2 y-3 y-4 y-5 Average
Standard Dev

Gross Profit Margin 22.33 22.22 18.53
17.55
16.74 19.47
2.631861201

Net Profit Margin 7.73 7.40 3.74
3.67
4.13 5.33
2.045947043

Return on Asset 7.91 7.22 3.47
3.41
4.50 5.30
2.124825288

Return on equity 12.543 12.551 5.71
6.03
8.44 9.05
3.359161326
Table: Profitability ratio of Tree Mendous Orchard

Conclusion

Cultivation of orange is becoming a money spinner in the district as farmers achieved steady growth in yield in the last few years.
According to the Department of Agriculture Extension (DAE), more than 500 hectares of hilly lands in Sylhet have been brought under commercial orange cultivation this year.
Farmers in the upazilas are expecting a bumper production of the fruit because of favorable weather, timely rainfall and necessary support from the DAE officials.
Tree-Mendous Orchard’s main concern will be to attract the investors to put money into the business. Other than that it will be to get customers out to pick all the fruit that is produced. The financial information shows that the operation is profitable at the given production levels and prices. The 8.6% IRR is too low however to cover the amount of risk involved in the operation. From this it can be deduced that this operation is not a viable one for any investors looking to make good returns with little risk.

REFERENCES

Bangladesh: Commercial cultivation of orange begins in Thakurgaon-http://www.freshplaza.com/news_detail.asp?id=37587

Iqbal Siddiquee ; Orange farming goes big in Bangladesh The Daily Star
Publication Date : 07-11-2011

http://www.asianewsnet.net/home/news.php?id=23612&sec=2

BANGLADESH ORANGES- Sunday, April 29, 2012 http://bangladeshunlocked.blogspot.com/ All Photos- Google Photo

Bumper orange production likely in two North Bengal districts-http://bangladesheconomy.wordpress.com/2012/01/04/bumper-orange-production-likely-in-two-north-bengal-districts/

Commercial orange farming expanding fast-http://bangladesheconomy.wordpress.com/2010/02/10/commercial-orange-farming-expanding-fast/

Good News From Bangladesh http://positivebangladesh.wordpress.com/2011/11/24/orange-now-moneyspinner-in-moulvibazar-bangladesh/ Bangladesh Information- http://www.zimbio.com/Bangladesh+Information/articles/Ael7XZ-Jro7/Orange+farming+gains+ground

ORANGE (MANDARIN)- http://nhb.gov.in/report_files/orange/ORANGE.htm

Production and marketing of oranges- http://books.google.com.bd/books?id=ET7G5hyVK90C&pg=PA22&lpg=PA22&dq=efficient+orange+cultivation&source=bl&ots=viYcERQ3V9&sig=GhKXtB39HG22fOeO1Zm2ZDL8arg&hl=en&sa=X&ei=IwKkT77mBIHtrAeoibGNBg&redir_esc=y#v=onepage&q=efficient%20orange%20cultivation&f=false Dr. B. A. A. Mustafi, Dr. Md. Rafiqul Islam- Development of Agricultural Policies in
Bangladesh
http://www.ipipotash.org/udocs/Development_of_agricultural_policies_in_Bangladesh_MAA_Mustafi.pdf

"Livestock a major threat to environment". UN Food and Agriculture Organization. November 29, 2006. Archived from the original on March 28, 2008

How to Grow an Orange Tree From Seed- http://www.ehow.com/how_2079932_grow-orange-tree-from-seed.html

Orange fiesta http://www.thedailystar.net/lifestyle/2011/12/02/page04.htm ORANGE ORCHARDS- http://www.har.com/neighborhoods/RAMSEY-ORANGE%20ORCHARDS-subdivision-10642310010002.html

Golden Grove Orchard- http://www.goldengroveorchard.com.au/ Citrus http://www.stargrow.co.za/products.asp?CatID=13 Orchard Planning Basics http://www.thenewfruitgrower.com/orchard_planning.htm Orange Orchard Management http://isikkim.com/2012-04-sikkim-farmers-get-training-in-orange-orchard-management-17-6/ Happy orange orchard http://bangladeshicircle.com/index.php/growers/23-happy-orange-orchard National Center for Food and Agricultural Policy http://www.ncfap.org/

References: http://www.asianewsnet.net/home/news.php?id=23612&sec=2 BANGLADESH ORANGES- Sunday, April 29, 2012