Abel Abel

Small Business: How To Set Up A Commercial Feedmill

Animal protein consumption in Nigeria is becoming very critical. Fifty percent of the cost of producing proteins of animal sources can be attributed to animal feeds. Investment in animal feedstuff preparation will therefore contribute greatly to the development of animal protein supply in the country.

The viability of any project is a function of raw materials availability, market potentials and management. Raw materials for animal feeds ingredients abound in Nigeria. These include, among others, oyster shells, bone meal, maize, soya cake, groundnut cake, palm kernel cake and a host of others. Market for animal feeds is also limitless. Animal feeds requirement in Nigeria is not less than four million metric tons. These animal feedstuffs can be exported for a good price. In this regard, anything that is produced is automatically consumed. The requirement in terms of manpower is not demanding. This is because the production process involved in the preparation of feedstuff is very simple. The project can easily be managed by mid- level manpower.

The profitability of the project is not in doubt as substantial returns on investment are guaranteed. In view of the above, this project is strongly recommended to serious-minded investors who are desirous of capitalising on viable investment openings and at the same time contributing positively to Nigeria’s economic development by creating real investments, job opportunities and making more food to Nigerians.

TECHNICAL INFORMATION

The feeds ingredients in mind are bone meal, oyster shells soya cake and cassava meals, maize, wheat offal’s groundnut cake, etc. Their preparation involves installation of simple machines and the materials are subsequently processed to be sold to poultry farmers. Investors can go further down by compounding the feeds, which are sold directly to animal farms such as poultry farms, turkey farms, pig farms, cattle farms and sheep and goat farms and fish farms.

To establish the project, the first step is the preparation of a comprehensive feasibility report showing technical and financial details of the project. This is followed by procurement of appropriate site and machines. On installation of machines, appropriate personnel are recruited. This is followed by procurement of raw materials for onward processing. Serious-minded investors can be guided accordingly on request.

FINANCIAL IMPLICATION

It will cost of a sum of N6.6million to establish the project. Cost components are broken down as follows:

1. Pre-Investments: N100,000

2. Accommodation: N2,500,000

3. Plant and Machinery: N2,000,000

4. Working Capital/

Utilities N2,000,000

Total N6,600,000

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PROFITABILITY

The plant has capacity of producing five tonnes per day of animal feeds. Profit margin of N5, 000 per tonne of feed produced has been computed. Working 200 days a year, annual profit of N5 million is achievable. Prospective investors can be assisted to successfully to establish this project.