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Business Plan on Strawberry Farming

Submitted for
Saif Rahman
Submitted By:
1. 1. Nayma Alam

071185030

2. 2. Nazmul Ahsan

072440030

3. 3. Shams E Rifat Rinthia

071247030

4. 4. Naima Bari

071179030

5. 5. Talhatul Islam

072388030

6. 6. Lutfun Nahar Lopa

073099030

LETTER OF TRANSMITTAL
8th April, 2010.
To,
Saif Rahman
School of Business,
North South University
Bashundhara, Dhaka.
Subject: Submission of new business Strawberry farming.
Dear Sir,
It is a matter of pleasure and honor for us to have the opportunity to submit our Group 7 project
on Strawberry Farming as a part of our academic activities.
We have put in our maximum effort in this group project. We show our uttermost gratitude for
the opportunity you gave us to implement our analytical thinking and interpretation skills that
will help us in building future career.

We therefore would like to place this case analysis to you for your kind consideration.
Yours Sincerely,
_________________________________

______________________________

Shams E Rifat Rinthia

Naima Bari

(071 247 030)

(071 179 030)

_________________________________

______________________________

Nayma Alam

Nazmul Hasan

(071 185 030)

(07244030)

_________________________________
Talhatul Islam

______________________________
Lutfun Nahar Lopa

(073099030)
Table of Content
Executive summary
Introduction
The opportunity
The product Description
Market Analysis
Industry analysis
Competition Analysis
Marketing plan
Management team
Manufacturing process
Financial Projection
Conclusion

5-7
8
9
10-12
13-17
18
18-20
21-27
28
29-30
29-30
30-37

Executive Summary:
Strawberry (Fragaria vesca) is an important fruit crop and its commercial production is possible
in temperate and sub tropical areas of Bangladesh. The countrys weather proved suitable for
strawberry farming although this delicious fruit is normally produced in countries having cold
weather, particularly in the West.

Professor Dr. M Monzur Hossain is the pioneer of strawberry cultivation in Bangladesh. In the
early 1990s, Dr Manzur was in Japan, having his PhD, when Quamruzzaman joined him in a
one-year training session. After finishing of their training, they together planned the cultivation
of the strawberry in Bangladesh.
There is opportunity for this industry. The current market demand is about 50 tonnes where 25
tonnes are supplied by the local producers. Yearly turnover rate was about 10 crore taka in
2009.Imported strawberries are being replaced by the local ones. So the market is increasing. In
near future, it is very much possible to export this fruit after meeting the local demand.
One cup (144 g) of strawberries contains approximately 45 calories and is an excellent source of
vitamin C and K. Strawberry also contains water, energy, protein, minerals, amino acid etc.
Strawberry takes good care of eye, strengthens teeth and also removes harmful toxic from blood.
Medically, it is also known as an antiviral remedy. It is also beneficial for diabetic patients if
processed accordingly.
Our value proposition will be created based on better quality, strong distribution channel,
attractive packaging, valued customer, different promotional offers and marketing programs.
A thorough market research, industry and competitor analysis has been done. We did the market
research through doing survey(sample size 45). We found the growth rate of market demand is
42.85%
Our niche target markets are:

Super shops (upper class and upper middle class)


Agora(4 outlets)

Shopno(among 41 outlets ,we will target only 5-6)

Lavender(1 outlet)

Nandan(4 outlets)

Fruit Market of Bannai and Gulshan

As strawberry is an expensive and foreign fruit, it is not well known about the general people. So
we have targeted gulshan banani area where literacy rate, income level and number of foreigner
is very high compare to other areas.
We are starting our business in 1 bigha land in the first year. From 1 bigha, we can get 2000 kg
strawberries in a season. But for many reasons (natural calamity and diseases) .it might happen
that we lose some fruits. So we narrow down our target to 1625 kg by which we can capture
3.25% share of the market.

There are many direct and indirect competitors of us. So we have to compete with them very
strongly. To get the market share more strongly we need to create brand image in the mind of
customers. So we have a marketing plan which includes clippings in the tv, articles in
newspapers, promotional activity in the supers hops and packaging with companys name and
picture. Our pricing strategy will be market penetration. We will charge a price which is lower
than the market price. Our cost par kg is 123 taka, so even if we charge 500 tk, our profit margin
will be very high.
Initial investment will need 1,033,500 tk.6 partners will initially invest in the business.1.15 lakh
tk each and for the rest we will seek for loan(33%0 with an yearly interest rate of 9% for 3 years.
In the management team,2 partner will work in the field along with two more worker. Another 2
partner will be responsible for packaging. The rest 2 will be doing the distribution and marketing
along with 2 more worker under them and 1 van driver will be appointed for transportation.
We will buy a land of 1 bigha in Tangail, patrail village.In the 3rd year we will go for expansion
and for that we will take lease of 1 more bigha land for 3 years.We will reach our break even in
2year and 5 months where break even sales are estimated to be 1,021,499 tk and break even units
are estimated to be 2853 kg.
Though it has risk factors (rotten behavior, small farmers, sour taste of the fruit), it has the scope
for expansion. Strawberry can be used in industrial production of ice cream, jam, jelly, juice,
taste and color. Rather than only taking as fresh fruit, if these usage of strawberry can be started,
then this business will prosper more.
Any business should have a clear exit strategy before it goes for operation. If we really need to
shut down our business of strawberry farming, first thing we will do is we will give out our land
for lease to any interested party. Land itself has its own value. So giving lease
(getting party to take lease) would not be a problem. More over, it will generate a fixed income
par year. Others equipment and van will be sold or will be given rent based on the cost benefit
analysis.
1. Introduction
Strawberry (Fragaria vesca) is an important fruit crop and its commercial production is possible
in temperate and sub tropical areas of Bangladesh. The countrys weather proved suitable for
strawberry farming although this delicious fruit is normally produced in countries having cold
weather, particularly in the West.
Professor Dr. M Monzur Hossain is the pioneer of strawberry cultivation in Bangladesh. In the
early 1990s, Dr Manzur was in Japan, having his PhD, when Quamruzzaman joined him in a
one-year training session. After finishing of their training, they together planned the cultivation
of the strawberry in Bangladesh.
In 1996 at the time of returning home, Manzur brought along eight varieties of saplings and
Quamruzzaman collected six varieties from Japan and America. But none of them sustained in

Bangladeshi environment. But they do not gave up. They started doing experiment on it and at
last Manzur developed some new varieties through tissue cultures at his Botany departments
Plant Breeding and Gene Engineering Laboratory, while Quamruzzaman did the same in Natore.
After five years of research, in 2003, three varieties yielded encouraging results. Out of the three,
the RU-3? and Modern-3? variety have proved to be very impressive in all aspects of size,
taste, and flavor, with each fruit weighing from 20 to 25 grams. At present, the methods are now
more developed, following successful cultivation over the last five years. In this way strawberry
starts its journey in Bangladesh.
2. Opportunity

Current demand 50 tones par year, we grow half of the demand locally

Yearly turnover Tk10 cr.

countrys weather proved suitable for strawberry farming

It is in the introduction stage .Market demand is increasing significantly

Gradually developing its variety, successfully grown two American varieties with 75
gram per fruit weight.

Slowly but strawberry market is spreading outside of Dhaka.

Imported strawberries can be replaced by the locally produced strawberries.

After meting local demand, foreign exchanges can be earned through doing export.

Strawberry business falls into SMEs category. Present government is giving many
subsidies on SMEs to promote the growth of GDP.

3. Product Description
Our product is Strawberry which is a sweet fleshy red fruit. Strawberry belongs to the family
Rosaceae. It is a low perennial herb with many runners and bearing white flowers followed by
edible fruits having many small achiness scattered on the surface of an enlarged red pulpy berry.
This is the only fruit which carries seeds on the surface. Garden strawberries are a common kind
of strawberry cultivated worldwide and is a well-known fruit mostly in western countries.
Various usage of strawberry in addition to being consumed fresh is:

Strawberries can be frozen, made into preserves, as well as dried and used in such things
as cereal bars.

Strawberries are a popular addition to dairy products, as in strawberry flavored ice cream,
milkshakes, smoothies and yogurts.

Strawberries are also used to prepare pie, juice, jam etc.

Strawberry also has a high nutrition value.

One cup (144 g) of strawberries contains approximately 45 calories and is an excellent


source of vitamin C and K.

Strawberry also contains water, energy, protein, minerals, amino acid etc.

Strawberry takes good care of eye, strengthens teeth and also removes harmful toxic from
blood. Medically, it is also known as an antiviral remedy.

It is also beneficial for diabetic patients if processed accordingly.

Strawberry pigment extract is used as a natural acid/base. As a kitchen remedy,


strawberry removes tartar.

Value Proposition:
Whenever someone starts a business that will prosper only if, it creates any value to its target
market. Though Strawberry farming is new in Bangladeshi market, it has potential competitors
that can be one of our main threats. We will overcome these threats if our farm creates any
particular value to our customers which has not created by any other strawberry farms. Our value
propositions can be:

Valued customer:

We will make sure that some portion of our target market becomes our valued customer, and we
will try to serve them in a better way.

Offers:

For marketing we are offering many things like free recipe with every packet, showing cooking
processes at superstores and many more. We will continuously come up with this kind of
different offers so that we can grab and hold our potential customer.

Marketing programs:

So far no strawberry farm did enough marketing program that can attract customers thats why a
huge number of people are still unaware of this fact that in Bangladesh strawberry farming is
possible and the benefits of this fruit. Our main aim of marketing programs will be to make
people aware of this beneficial fruit with attractive marketing programs.

Distribution channel:

We are going to distribute the strawberry to the superstores and other fruit markets by our own
people. We are not involving any third party in our business for distribution. So distribution will
be heavily monitored by us.

Quality:

At Bangladesh Agricultural Research Institute (BARI) we took a short course on how to start a
strawberry business and that made us able to chose best strawberry seeds and plant it in a proper
way and fertilize it in such a way that best kind of strawberry will be seen in the plants. Also we
know the best way to store them which will help us to provide best quality strawberry to our
customers

Packaging :

Packaging is going to be very different and attractive than our competitor. Using baskets which
will be wrapped with cellophane papers will keep the strawberry in a good condition and also it
is very attractive.
4. Market Analysis
Market of strawberry in Bangladesh is growing now. The stage of this strawberry industry is
growing very fast. To analyze the market we need to determine few things. These things are

Growth rate

Target Market and justification

Target market size

Market Survey

1. a. Growth Rate:
Strawberry is a growing industry of Bangladesh; we analyzed the market and observed that in
2009 the market demand for strawberry was 35 tons. And next year it went up to 50tons. From
these we can calculate the growth rate of strawberry in Bangladeshi market.
Growth rate = Changes in demand from previous year/demand of last year
= (50-35) tons/35tons
= 42.85%, so the market has grown by 42.85%.
Justification For Growth Rate: As we know strawberry is very new in Bangladeshi market and
people gradually getting known about this fruit, so first few years the growth rate will be higher

but in upcoming years the demand will not grow that much because industrial or other usage of
strawberry in Bangladesh has not started yet. If we take the growth rate of 42.85% next year in
year 2011 the demand will be 71425tons. For year 2012 we are assuming that the growth rate
will be 45% and demand will be 103566tons. After 2012 the growth rate will be steady as many
farmers will start producing strawberry.
b. Target Market and Justification:
Our niche target markets are:

Super shops (upper class and upper middle class)


Agora(4 outlets)

Shopno(among 41 outlets ,we will target only 5-6)

Lavender(1 outlet)

Nandan(4 outlets)

Fruit Market of Bannai and Gulshan

As par 1991 Bangladesh census, Gulshan had a population of 281,337. Many of Dhakas richest
reside here. 21.59% of residents are occupied with commerce while 40.92% are service
professionals. Average literacy rate of the area is 59.7% for people over the age of 7 against the
national average of 32.4%.
Most of the foreign diplomatic missions in Bangladesh area are located in Gulshan or Baridhara
Diplomatic zone.
All international brand stores like Movenpick, Baskin Robins, Coffee World, Roll Express, Pan
Pacific Hotels and Resorts, Westin Hotels are there in Guslhan.
So we can clearly understand from the above information that people of Gulshan Banani belong
to the upper and upper-middle class society. Their income and education is very high compare to
other areas of Dhaka city. Foreign Diplomatic Missions are situated here means there are foreign
population in this area. As strawberry is an expensive and foreign fruit, it has its acceptability in
this market. They already know about the fruit and they have the ability to but this expensive
fruit.
In the super-shops (different outlets in Dhaka city), generally upper and upper-middle class
people come to do their shopping. Strawberry is now in the introduction stage and it is highly
expensive. So it is tough for middle class or other people to keep strawberries in their
consumption basket. That is why our target market is the super-shops and Banani-Gulshan fruit
market initially where foreigners, upper and upper-middle class people usually do their shopping.

c. Target Market size and justification


Strawberry growers and traders in Bangladesh are expecting Tk10 cr. in annual turnover, as they
go into its first-ever commercial cultivation in 2006.
Rajshahi University professor Dr. Manzur Hossain, who developed the fruit nearly a decade ago,
expects nearly 25 tonnes of output from about 8.5 acres of land in 45 districts until April.
The initial commercial production will meet 50 percent of the gross annual demand for the fruit.
At present, the demand for the fruit stands at 50 tons, said Hossain, also the general secretary of
Bangladesh Strawberry Farmers Association, which monitors the fruits cultivation in the
country.
So the market demand for strawberry in Bangladesh is 50 tonnes (1 ton=1000kg, 50
tonnes=50,000 kg).As we are just starting, we will do the cultivation in a land of 1 bigha size
only. Per bigha land we can plant 6000 seeds. In other words, 1 bigha land has a capacity of 6000
strawberry plant.
Each strawberry plant bears around 300 to 350 grams of fruit.
So, we can harvest 1800 kg (6000*300gm) to 2100kg (6000*350gm) of strawberries from one
bigha land in a season. By doing this we can capture 3.6% to 4.2% of the market share.
3.6% of 50,000 kg= 1,800 kg
4.2% of 50,000 kg= 2,100 kg
As we are producing for the first time, we do not have any experience and it might happen that
some trees will not give fruits or fruits are not properly grown. Natural calamity (rain, storm) can
also harm some trees. So we might loss some of our fruits.
Suppose 1000 seeds/plants are unproductive. Then:
5000*300 gm = 1,500 kg
5000*350 gm = 1,750 kg
Thus we are narrowing down our target market size from 3% (1,500 kg)-3.5% (1,750), on
average 3.25% (1625kg).
X% of 50,000kg=1500
So, x = 3%
X% of 50,000 kg= 1,750 kg

So, x = 3.5%
(3.5%+3%)/2 = 3.25% (Target Market share)
3.25% of 50,000kg= 1,625 kg (Target Market Size)
d. Market Survey:
Nandan
5to8 kg
700to800 tk

Swapno
1.5to2 kg
700to800 tk

Lavendar
2to3kg
600to700 tk

Banani local fruit


1.Daily sale
aproximately 5 kg
2.Price
around1000to1200 local
strawberry
3.Buying price Didnt mention Around 500 taka 20% less than
They said their buying price
their selling
800 to 900 taka. I think it is
prince ( 450-500) fake price. It would around 450
taka because quality is bad than
the super shop.
4. sources
NW(j)4, kamal Emrul Kayes
1.Md. Atiar
Not availabale
Ataturk
Rahman
Avenue,North
Supervisor &
Avenue Gulashan manager
Mob:01916Dhaka 1212
041491
Gulshan-2
Tle: 9862637,
2.Murad
88850049
Chowdearry
Mob: 01974163015
E-mail:
Mob:Gulshan@nandan
01711781782
megashop.com

We conducted a survey among our main target market that is foreigners and superstores of Dhaka
city. When we analyzed the data and talked with different assistant managers of different
superstores we found out that he market for strawberry is growing very fast and for that we have
found that import of foreign strawberry has almost stopped. This is a very good indication for
our strawberry industry. In near future demand of strawberry will increase significantly.
5. Industry Analysis
Commercial production of strawberry has started in the year 2006 in Bangladesh and currently
there is a demand of 50 tons of strawberry in Bangladesh. Currently local producers are growing
only 25 tons which is only half of the total demand. And the rest half is being imported from
other countries. So there is good scope available for local producer to grab the market and supply
according to the demand. Observing the market scope many local farmers have already started
and planning to start growing strawberry at a large scale. This is good news, because if

production increases than we will not have to import strawberry in future. But there is another
factor that should be taken into consideration. If our local production rate increases like this, in
future this will exceed the industry demand growth rate. So, there will be, excess supply in the
industry compare to the demand although there is a shortage now. To get rid of this problem, we
have to increase the usage of strawberry along with fresh consumption. For this, please see our
extension plan.
From the survey of other producers of strawberry in the local market, we found their year to year
growth and by taking average we found the industry average which is 42.85%.
6. Competitor Analysis
After producing strawberry our first challenge will be the competition in the market. We have
both direct and indirect competitors in the market. There are a lot of competitors already in the
market who are producing and marketing strawberry in Bangladesh for last few years. These are
our direct competitors. Among all direct competitors existing in the market, we have identified
our main competitors and below there is a brief description about our main direct competitors.
A.R. Enterprise (Phone: 01711402525)
This farm is located at kaliakawr in Gazipur. They have started strawberry farming from the year
2004 and farming on approximately 7 bigha of land with an annual production of around 14000
kg and daily production of around 80 kg. There are 3 manager level employee and 10 workers
working in this farm. Their production cost per kg of strawberry is around Tk180 and selling
price is around Tk400 per kg. They mainly supply strawberry in a all the branches of Nandan
super shop and some fruit markets of Banani and Gulshan area. There main competitive
advantages are:

Low transportation cost, ability to supply strawberry at a faster rate as the farm is located
close to Dhaka.

Ability to sell at a lower price as they have achieved economics of scale.

King Sons Farm (Phone: 01714352223)


This farm is located in Maymanshing. They are faming strawberry from the year 2009 on 4 bigha
of land. Their annual production is around 7500 kg with a daily production of around 40 kg. In
this farm 5 workers are working now under a manager. There production cost is around Tk210
and selling price is around Tk400 for per kg of strawberry. They supply strawberry in different
super shops of Dhaka city along with retail fruit markets. Some of their competitive advantages
are:

Low labor cost

Comparatively competitive selling price.

Garden Fresh Strawberry (01731402766)


This farm is located in Ashuliya, Dhaka. They are faming strawberry from 2009 on 1 Bigha of
land. There annual production is around 2000 kg with a daily production of 13 kg. There
production cost of per kg of strawberry is around Tk280 and selling price is around Tk400. There
are 9 workers working in this farm. They supply strawberry to super stores, local market as well
as in restaurants in Dhaka. There competitive advantages include:

Low transportation cost as the farm is very close to Dhaka.

Strong connection with buyers.

Indirect Competitors:
We have some indirect competition with small local growers, who have recently produced
strawberries seeing the high profit initially but after they have produced strawberry, they are
scared that whether they would be able to sell this strawberries in the market or not, so they have
started selling at a very lower price. As a result, the overall prices of the strawberry have
decreased at a significant rate recently. These small farmers are also our competitor because now
we have to beat them in case of price, quality and we also have to make profit. This is also a big
challenge for our farm. Another indirect competition for our strawberry is, it have to compete
with other fruits in the market. As, strawberry is new and not very familiar among all, so this will
be also a challenge.
7. Marketing Plan
Marketing is a process by which companies create value for customers and build strong customer
relationships in order to capture value from customers in return also it helps to grow customers
by delivering satisfaction. For our strawberry we will go for traditional marketing processes as
well as few innovative promotional activities will be doing by us. Our brand will be created later
on but before creating a brand image we have to let our target people know about the features
and benefits of this very famous foreign but locally grown fruit Strawberry.
In Bangladesh, strawberry farming has been started for couple of years and its growing almost
every year. Fruit is always a good thing to have. But there are other farms in the strawberry
industry so our marketing plan programs should be done by keeping that in mind. Our marketing
plan consists of few steps and those steps are described elaborately below:
Step-1: Situation Analysis
Before entering any market we have to analyze the advantages and disadvantages of that market.
Though strawberry market is new in Bangladesh still we have competitors. So the advantages
and disadvantages are:
Advantages

Our quality is better than the competitor.

Our distribution is stronger

Our packaging is better

Disadvantages -

Small farmers have started growing strawberries

Few people still think foreign strawberries are of better quality.

We have to grow strawberry for a particular span of time (September-March)

Rest months of the year we will be sitting idle.


Step-2: Key Planning Decision
1. Advertising objective: Our objective for advertising will be to provide our customers
fresh, locally grown, well-packed, tasty strawberries which are cheaper than imported
strawberries but have the same quality and taste.
2. Target Audience: Target audience for our advertisement will be-

Superstores (Swapno, Agora, Lavender, Nandan)

Foreigners.

High and middle income people of Banani, Gulshan, Baridhara area.


1. Competitive Product advantage:

-We will promote our strawberries along with the numerous benefits it has, we will promote the
attributes rather than the product.
- The quality of our strawberry is better than the competitors.
- Also the packaging of our strawberry is going to be better and different than the competitors.
Present strawberry farms in Bangladesh provide their product in a plastic packet which is not that
much strong. We are introducing a new packaging for strawberry and that is fruit-baskets and the
picture is shown above. Though this packaging will cost only 1.5 taka more than of those plastic
packets but the benefits of these baskets are not unknown to the customers. These baskets look
very attractive and strong. Also these baskets can be re-used. And in each basket there will be a
free strawberry recipe. As we are thinking for extension and expansion, we need to create
brand image and brand loyalty among customers. This packaging will help us to achieve that.
1. Product Image :
1. e. Personality and benefits:

The personalities of Strawberry are:

Strawberries are high in Vitamin C & K. Vitamin K is very rare, so or strawberry can
provide people this rare vitamin very easily and we all know vitamin C can prevent
numbers of infectious diseases.

Research shows that if one heart patient can eat 8-10 strawberries, his blood pressure can
significantly decrease.

Strawberries also reduce risk of cancer; enhance memory function, and rheumatoid
arthritis.

Strawberries also take good care of our eyes and teeth.

It removes harmful toxin from your blood

There are lot more benefits of the great berry, Strawberry. We will use these personalities and
benefits to promote our product to the target market. Showing these attributes to the customer
can be one of our main and strong marketing strategies as no farm ever did this.
1. f. Product Positioning
We know the development of strawberry has been done in Bangladesh. Now the stage for the
market is Introduction. We know during introduction stage Marketing programs has to be done
more.
Step-3: Tactics and the Media Strategy
The tactics of our advertisement of Strawberry are:
1. Superstores:
When we will start supplying our products to the superstores, in a corner there will be some of
our marketing people who will interact with the customers and will tell them about the benefits
of strawberry .Two of us will show people some quick recipe of strawberry and will serve them
free for the first month of our promotion.
1. 2. Decorated Shelves in the Superstores:
In the superstores, we will provide our own decorated shelves to display our StrawberryZones Strawberry. Those shelves will be colorful and attractive so that it can drag customers
attention. Super shops will allow us to do the marketing because it will bring customers for their
shops too.
1. 3. Newspapers:

In the 2nd or 3rd month of our production, we will, publish an article on our strawberry cultivation
and the importance of strawberry in Prothom Alo and Daily Star. Thus people will come to know
about strawberry in a large scale and by describing our firm/s business we will also create an
image on customers mind.
1. 4. TV:
When we will get few responses from the customers we will grab the TV media. We will not go
for any advertisement for our product as that will be very expensive; rather in different
agricultural programs like Ridoye Mati o Manush in different channels we will show our work
as a feature.
1. 5. Posters :
Posters will be posted in different areas showing the colorful bright red image of strawberry.
Step-4: Creative Strategy
Creative strategy includes two things. Firstly what is the message we are trying to deliver to our
target market, its more like a Specific Slogan for our product. Secondly what is main concern
of our product that will attract our customers to frequently buy our product?

The Message: the message or the slogan for our strawberry can be:

Real Juicy & Tasty Strawberries for YOU!

The main Concern: the main concern of our product is to make people aware of their
health and many human-health problems like eye problems, teeth problems, skin
diseases, infectious diseases and most importantly heart problems. After awaking them
about these problems we will tell them what strawberry can do to prevent these problems.

Step-5: Pricing Strategy (market penetration)


As we have stated earlier that we have done a market as well as a competitor analysis, we
analyzed that industry average price for per kg strawberry is 716.67 taka. We have found that our
cost of goods sold per kg is 123taka and we are selling at a rate of 500taka/kg. Our selling price
will be a lot less than the competitors. This pricing strategy is called Market Penetration. We are
asking for low price to grab the target market.
Packaging
Packaging will be done in such a manner so that it will create value to our product. We will first
separate the strawberries according to its size, color and weight. Three kinds of Packaging will
be there.

One for the big sizes which will be delivered to super shops. One for small sizes only and the
other one will be mixed of both sizes. Packaging will be done on the basis of customer demand
(small, big and medium sizes).
Each package will contain 250 gm of strawberries. A green basket full of fresh & red
strawberries with our firms name and pictures will also create the brand image gradually.
Each green plastic basket will cost 2 tk and the wrapper with the name and picture printed on it
will cost 1.5 tk. So the total cost of par packaging will be a total of 3.50 tk.
Distribution
Our Distribution strategy should be our competitive advantage. We will keep the distribution
channel very simple. As this is a start-up business, no distribution agents will be used primarily
as it will increase the cost.
Before harvesting, distributor will contact with the fruit shops and super-shops to know the
demand of that day (which branch of super-shops will need what amount of strawberries).They
will do it on a daily basis. As strawberry is an extremely perishable fruit, it is necessary to deliver
the fruit as soon as possible. So all contracts (how many kg to which outlet) should be done
before.. Then strawberries will be collected from the firm in plastic crates. We will use the public
transportation to take those fruit crates from the firm to Dhaka location (where we will do the
packaging).
2 people will be responsible for the packaging. Then these packets will be delivered through the
marketing people& distributor (4 people) to the destinations. We will use van to distribute which
will reduce our transportation cost.
Storage
Initially we do not need to store as we will distribute as soon as we will harvest based on the
demand. But gradually when we will expand in the upcoming years (3rd year of our production),
we will need storage system. Fruits can be stored in storage at 32 degree Celsius up to 10 days if
necessary.. For distant marketing, strawberry should be pre cooled at 4 degree Celsius within 2
hours of harvesting and kept at the same temperature. After pre cooling they will be shipped in
refrigerated vans.
8. Management team
Ours is a partnership business. We are six people in the business. Two of us will be in the farm,
Tangail to supervise the cultivation process like preparing soil, seed plantation, irrigation, pest
control, plucking fruits etc. There will be two workers working under them. Rest four of us will
be in Dhaka. Tow of them will do the packaging of our strawberries that will come from Tangail.
Rest two will supervise the distribution of strawberry to different super shops and retail shops in
Gulshan and Banani region. The marketing process will be also controlled by them. There will be

tow more workers working under them. Moreover, there will be a van driver who will take the
strawberries to super shops and retail market.
9. Operation and Delivery process
Operation process of farming strawberry starts with preparing the soil. Preparing soil will start
from the month of June then it will take approximately three months to prepare the soil. On the
month of September we will plant strawberry seeds and then from September to December the
plants need to be take care like fertilization and irrigation. By December the plants will be fully
grown and fruits will be ready to pluck. After that, we will have to start marketing for our
product, take orders, do packing and distribute as per requirements to different super shops and
local fruit markets. We will have to do this till April.
10. Financial Projections
Initial investment:
Land
Van
Irrigation Pump
Strawberry Seeds
Fencing
Legal
Expenses(Memorandum,
BSTI)
Insurance
House For Labor
Organic Herbicides
,Pesticides
Training Expense
Cash in hand for other
expenses(first months labor
salary, electricity, gas bill
payment and other day to day
expense)

Total Investment

56 decimal*6000tk
1*6,000 tk
1*12000 tk
6000*10tk
60,000 tk
9,000 tk

700,000 tk
6,000 tk
12,000 tk
60,000 tk
60,000 tk
9,000 tk

5,500tk
1,50,000tk
5000 tk

5,500 tk
1,50,000 tk
5,000 tk

2 person*3000tk
6000 tk
Labor
80,000 tk
cost:11,000tk*2=22,000 tk*3
months=66,000 tk
Electricity,gas and other
expense:14,000 tk
1,033,500 Tk

Land
We will buy 56 decimals or 1bigha of land in Tangail at Patril village. It will cost us 700,000 tk.
We will buy the land instead of taking lease like other competitors because we have done a
thorough market and industry analysis. We have found that in Bangladesh strawberry has a

potential market and in near future it will be possible to export it in other countries of the world.
So if we have our own land then we can produce at least a fixed amount of output even if we can
not go for expansion. We dont have to be worried about the lease period or lease renew or lease
contract cancellation for which many competitors business may get harm. So owning of land is a
competitive advantage of ours over the competitors.
Van
In Dhaka, if we use public transportation, then for 20 kg, par day transportation cost is from 350400 tk range.
So weekly 2,450-2,800 tk.
Monthly 9,800-11,200 tk, which is costly.
If we buy a van spending 6000 tk which is a fixed asset, and then paying a van driver 3,000 per
months, our total cost goes down. It is economic to buy a van and keep a van driver for the
distribution purpose.
Irrigation Pump
It will cost around 12,000 tk.
Strawberry Seeds
We will buy the strawberry seeds from a nursery in BARI (Bangladesh Agricultural Research
Institute). Par seeds will cost 10 tk. As 1 bigha land has a capacity of 6000 plant, to use the full
capacity we will plant 6000 seeds. It will cost 6000*10tk= 60,000 tk. Once we buy the seeds, do
the plantation, after harvesting we can reuse it.
Fencing
Fencing can be done for 5 years durability .To protect the firm and to protect the plants from
birds, it is need to do the fencing which will cost 60,000 tk.
Legal Expense
To get the memorandum for doing strawberry business and For BSTI permission, it will cost
9000 taka.
Insurance
Insurance should be done. Crops get damaged for various reasons(diseases, natural calamity
etc.). For this, insurance should be done which will cost 5,500 tk par year.
Organic herbicides and Pesticides

Strawberry is a very vulnerable plant. It may get attacked by different diseases. To protect from
these diseases, we need to use organic herbicides and pesticides which will cost around tk 5,000
par season.
Training Expense
Framers need to be trained to grow quality fruits. Many farmers just do the farming without
knowing the technology and the process. That is why they do not get the optimum output or
quality is not up to level. So here we will create our value proposition and it will be another
competitive advantage. Two of our farmers will be trained from Rajshahi Universitys training
center where strawberry was first cultivated. This will cost 3,000 tk each. So a total of 6,000 tk
will be included in the initial investment.
House for Labor
We need to built a one shaded room (brick built, tin shaded) for the labors and for keeping pump
and other equipments. It will cost 150,000 tk.
Cash in hand & Total Initial Investment
Initial Investment is now of 953,500 taka. We need some cash in hand to operate day to day
activity and for first three months salary, electricity, gas, water and other expenses. If we keep
cash in hand for about 80,000 tk then our initial investment end up with an an amount of
1,033,500 tk.
Funding Source:
Each of us (6 partners) will invest 1.15 lakh tk. For The rest of 3.435 lakh taka, we will seek for
bank loan at an interest rate of 9%. So we are financing our business with a combination of
equity and debt financing. Equity 67% and debt 33%. As strawberry businesses falls under small
and medium enterprises (SMEs), it has the opportunity to get a bank loan. The present
government is giving many facilities for these SMEs to achieve higher GDP growth rate.
Strawberry production is in the introduction stage and earlier we have already discussed that it
has many opportunities to grow in Bangladesh. It can also go for exporting after meeting the
local demand. So growth in this sector means growth in GDP for which banks are giving loans to
promote these kinds of businesses.
6members* 1.15 lakh tk = 6.9 lakh taka
Initial investment- equity financing= 1,033,500-690,000 =343,500
X% of 1,033,500=3.435 lakh
So, x = 33%
We will seek for bank loan of 343, 500 tk (33% debt) for 3 years at an interest rate of 9%

In the 3rd year, when we will go for expansion, we will go for lease which is also a form of
financing. We will take lease of 2 more bigha of land at an expense of 15,000 tk per year per
bigha.
Annual Production
Year 1 = 1625 kg
Year 2 = 2000 kg
Year 3 = 3500 kg (extension of production by taking lease 1 bigha of land)
Year 4 Even
= 4000analysis(volume
kg (using full capacity
of 2 bigha land)
Break
and sales)
Break Cost
Even Point Analysis:
Fixed
tk
Land
700,000
Our initial investment will6,000
be 1033,500 tk. Total fixed cost is 1,021,500 tk. Total variable cost
Van
230,700
taka
So
if
we
produce
Irrigation Pump
12,0001625 kg in the first year then out variable cost par unit or par kg
is 142 taka. We have set price
at 500 tk par kg. If we calculate the break even point in term of
Fencing
60,000
unit ofExpense
out put then we get9,000
at 2853 kg, it will reach the break even(no loss-no profit).In term of
Legal
sales volume it is taka 1021499.716.This
quantity or volume of sales will be reached at 2 years 5
Insurance
5,500
months.for
So,
after 2 years 5150,000
months, our business will start earning profit.
House
labor
Training Expense
6,000
Pipeline set up
4,000
Piping for water
40,000
salaries
22,000
water
3,000
gas
4,000
Total Fixed Cost
1,021,500
Varieble Cost
seeds
60,000
slaes salaries
13,000
Electricity
7,200
Packaging
24,500
Transportation
76,000
Mulching
15,000
Fertilizer
5,000
Digging
5,000
Soil Leveling
25,000
Total varieble Cost
230,700
Varieble Cost par
unit(kg)
142
Price per unit(kg)
500

Qb=FC/p-vc
S*=Fc/1-VC/S
Break even at

2853.106738
or 2853 kg
1021499.716
2.445428571
2 years 5 months.

Qb= Break Even quantity


FC=Fixed Cost
vc=variable cost par unit)kg)
p=price par
unit(kg)
S*=Break even point (sales
taka)
VC=Total variable cost
S=total sales
Expansion Scope
Strawberry is also used as a raw material for juice production, for jam production, in ice cream
factories for flavor, in beverages like milk shakes and other soft drinks. So, if we can produce
enough quantity and of better quality, then we can grab share of these markets too which was
primarily dominated by imported strawberries. We can make new uses of strawberries and we
have to make this uses, the business scope will increase. We will be the pioneer in the industrial
usage of Strawberry(as a raw material supplier for juice, jam, ice cream , beverages, flavor and
color) and export in other countries.
Risk Factors
Whenever there is a business, unconditionally there will be few risks. When we started planning
for farming strawberry, few certain risks we could assume are:

Rotten Behavior: Strawberry is very perishable in nature, it gets rotten very easily, so if
we cannot deliver them properly, they will be rotten and our production will be
hampered, so this characteristic of strawberry is going to be a risk factor for our business.

Taste of the fruit: Bangladesh is a country for very sweet & juicy fruits like Mango,
Lichi, Jackfruit, etc. Bangladeshi people love sweet fruits more than sour tasted fruits.
Though strawberry is very juicy and sweet, it has slightly sour taste, which Bangladeshi
people may not like very much.

Small farmers: Small farmers of Bangladesh have also started producing strawberries in
their fields and that may significantly decrease the price of per Kg strawberry as they are
not aware of the market. So our competition will be higher and as our cost will be higher
than of those small farmers, so eventually our price will be high, but our target market
will be seeking for lower price, so at that point if our customers do not understand our
brand image, we will lose them.

11. Exit Plan

Whenever we plan for a business to start, along with the plans for continuing the business we
also need to prepare or think of an exit plan. We need an exit plan because, for every business
there are two possibilities, it may work out or it may not work out properly.
For our strawberry farming we need more fixed assets than variable assets. Our fixed assets
include 1-Bigha land, van, water-pump, and equipments. If we really need to shut down our
business of strawberry farming, first thing we will do is we will give out our land for lease to any
interested party. Leasing this land is beneficial in many ways. If we give our land for lease it will
bring a good amount of regular income for us. Land is a very powerful natural resource. Land
itself has its own value. A piece of land will never lie idle; it can be used in many ways. So value
is already created to other parties who are interested to take it as a lease. In future if we can see
any profitable business that can be done using this 1-Bigha land, we can start that business after
the lease period is over.
Next fixed asset we have is the Van and the Water-pump. We can either sell the van or we can
just give the van to interested people for rent. We will sell the water-pump to another party as
well the other equipments.
12. Conclusion:
Keeping all uncertainties in to our mind, our company had already over estimated every possible
threat that should have been taken into account. By considering every possible threat we wish to
keep up quality control to perform regular research upon our strawberry plant. In addition, our
profit margin is a perfect encouragement for future expansion. Gradually after the first 3years of
our business operation we would definitely like to go for further expansion(industrial usage of
strawberry and export). Provided if things act into our behalf we would possibly stretch our
product line(strawberry juice, jam). By ensuring our company to outplay this sector even in the
next decades, we would easily lower our product price to outrage any present competition.