agricultural machinery business plan pdf

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HELLO TRACTOR'S BUSINESS PROPOSAL FOR THE 'ADOPT AN ACRE' MODEL

Kenya’s agricultural production process is plagued by low agricultural mechanization, coupled with the drudgery of manual production and manual post-harvest operations. This has led to low agricultural productivity below the country’s potential, leaving the agricultural sector struggling to meet the food production demand. Hello Tractor seeks to remedy the situation by providing Kenyan small-scale farmers in Uasin Gishu, Trans Nzoia, Siaya and Homa Bay counties with mechanization services to increase their crop yield and subsequently increase their farming income, while providing the local youth with meaningful business opportunities as our booking agents who will recruit farmers and earn a 5% commission. This will ensure the sustainability of the business model. Hello Tractor will achieve this though the ‘Adopt an Acre model’ as explained in the Business Proposal

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Farm Machinery Manufacturer Business Plan Template

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Agriculture Equipment Manufacturing Business Plan [Sample Template]

By: Author Tony Martins Ajaero

Home » Business Plans » Manufacturing Sector

Do you want to start an agro equipment company? If YES, here is a sample agriculture equipment manufacturing business plan template & FREE feasibility report.

The fact that there is no commercial farm without standard agricultural equipment means that the market for agricultural equipment will always experience upper trajectory. As an investor that has the capacity and engineering background, you should look towards this line of business and interestingly there are unrestricted market for agricultural equipment.

Below is a sample agricultural equipment manufacturing company business plan template.

A Sample Agriculture Equipment Manufacturing Business Plan Template

1. industry overview.

Companies in the tractors and agricultural machinery manufacturing industry manufacture agricultural machinery and equipment, in addition to powered lawn and garden equipment. Key agricultural equipment include tractors, harvesting and seeding machinery, grinders, mixers, wool presses, windmills and other hardware.

The Tractors and Agricultural Machinery manufacturing industry over time has experienced rapid growth due to rapid technological advancements, falling costs and new uses of agricultural machinery and equipment.

Going forward, the demand for agricultural machinery and equipment and of course the revenue generated are projected to increase rapidly as agricultural machinery and equipment manufacturing explodes in popularity and accessibility, especially in commercial farming markets.

Statistics has it that in the united states of America alone, there are about 1,371 registered and agricultural machinery and equipment manufacturing companies responsible for employing about 83,779 and the industry rakes in a whooping sum of $39 billion annually.

The industry was projected to enjoy -5.8 percent annual growth between 2014 and 2019. Although the industry is still pretty much open for new investors, but the establishments with the dominant market share in the industry are Deere & Company, CNH Industrial NV and AGCO Corporation.

Please note that the total U.S. industry market size for Tractors and Agricultural Machinery Manufacturing Industry statistics cover all companies in the United States, both public and private, ranging in size from small businesses to market leaders.

In addition to revenue, the industry market analysis shows information on employees, companies, and average firm size et al. Research carried out by IBISWorld estimates that industry revenue will decrease at an average annualized rate of 2.1 percent to $33.94 billion over the five years to 2015.

Immediately following the recession, the industry performed strongly, with high crop prices boosting demand for ethanol and solid climate conditions. These factors boosted farm income and demand for tractors and other agricultural implements.

However, the industry began declining in 2013, as weak commodity prices, a stronger dollar and softening demand for rural produce has caused farmers to put off new equipment purchases. In 2015, revenue is expected to continue declining. Global demand is expected to continue weakening as the dollar continues to increase and interest rate hikes are introduced.

If you are looking towards starting your own tractors and agricultural machinery manufacturing business, then you should endeavor to do your research, set the required structure and assemble the required team.

The tractors and agricultural machinery manufacturing business is still open to new entrepreneurs and investors to come in and build a successful business. But they must first and foremost ensure that they conduct thorough feasibility studies and market survey before situating the business in any location.

2. Executive Summary

Darren Stanley™ Agricultural Equipment Manufacturing Company, Inc. is a U.S based agricultural machinery manufacturing company. We have been able to secure a standard production facility in a conducive environment in Lake Tahoe – Nevada. We chose to start in Lake Tahoe because the city has continued to be a major center for venture capital investment.

Darren Stanley™ Agricultural Equipment Manufacturing Company, Inc. will be involved in the manufacturing of agricultural machinery and equipment such as tractors, harvesting and seeding machinery, grinders, mixers, wool presses, windmills and other hardware.

We will also be involved in the manufacturing of powered lawn and garden equipment for homes. Our business goal is to become one of the leading agricultural machinery manufacturing company in the United States and we will make sure that every agricultural machinery that leaves our production facility can favorably compete with the best in the industry.

Our workers are going to be selected from a pool of talented and highly creative engineers in and around Lake Tahoe – Nevada. We will make sure that we take all the members of our workforce through the required trainings that will position them to meet the expectation of the company.

At Darren Stanley™ Agricultural Equipment Manufacturing Company, Inc. our client’s best interest come first, and everything we do will be guided by our values and professional ethics. We will ensure that we hold ourselves accountable to the highest standards by delivering excellent and efficient tractors and agricultural machinery and also meeting our client’s needs precisely and completely.

Darren Stanley™ Agricultural Equipment Manufacturing Company, Inc. is a private business that is owned and managed by Mr. Darren Stanley and his immediate family members. Darren Stanley studied Printing Technology from Illinois Institute of Technology and he has over 22 years’ experience working with the leading agricultural machinery manufacturing companies in the United States of America.

3. Our Products and Services

Darren Stanley™ Agricultural Equipment Manufacturing Company, Inc. is established with the aim of maximizing profits in the industry.

We want to compete favorably with companies in the United States of America which is why we have but in place a competent quality assurance team that will ensure that all the agricultural machinery that we manufacture meet and even surpass our customers’ expectations.

We will work hard to ensure that Darren Stanley™ Agricultural Equipment Manufacturing Company, Inc. is not just accepted in Lake Tahoe – Nevada but also throughout the United States of America.

We will be involved in the;

• Manufacturing farm tractors and attachments
• Manufacturing harvesting equipment and machinery
• Manufacturing irrigation equipment
• Manufacturing seeders
• Manufacturing sprayers and spreaders
• Manufacturing windmills
• Manufacturing powered agricultural mowers
• Manufacturing livestock feeding and watering equipment

4. Our Mission and Vision Statement

• Our vision is to establish a standard and world class agricultural machinery manufacturing company whose products and brand will not only be accepted in Lake Tahoe – Nevada and throughout the United States of America.
• Our mission is to build a world class tractors and agricultural machinery manufacturing company that will be known to manufacture top notch tractors and agricultural machinery and to become the number one choice for the agriculture sector and other stake holder in and around the United States.
• We want to build a company that can favorably compete with other leading brands in the industry.

Our Business Structure

Darren Stanley™ Agricultural Equipment Manufacturing Company, Inc. intends starting small in Lake Tahoe – Nevada, but hopes to grow big in order to compete favorably with leading companies in the industry. We are aware of the importance of building a solid business structure that can support the kind of world class business we want to own. This is why we are committed to only hire the best hands within our area of operation.

At Darren Stanley™ Agricultural Equipment Manufacturing Company, Inc., we will ensure that we hire people that are qualified, hardworking, creative, customer centric and are ready to work to help us build a prosperous business that will benefit all the stake holders.

As a matter of fact, profit-sharing arrangement will be made available to all our senior management staff and it will be based on their performance for a period of five years or more as agreed by the board of trustees of the company. In view of that, we have decided to hire qualified and competent hands to occupy the following positions;

• Chief Executive Officer (Owner)
• Plant Manager
• Human Resources and Admin Manager

Sales and Marketing Manager

Engineers and Technologists

• Accountants/Cashiers
• Customer Services Executive/Front Desk Officer

5. Job Roles and Responsibilities

Chief Executive Officer – CEO:

• Increases management’s effectiveness by recruiting, selecting, orienting, training, coaching, counseling, and disciplining managers; communicating values, strategies, and objectives; assigning accountabilities; planning, monitoring, and appraising job results
• Responsible for fixing prices and signing business deals
• Accountable for providing direction for the business
• Creates, communicates, and implementing the organization’s vision, mission, and overall direction – i.e. leading the development and implementation of the overall organization’s strategy.
• Responsible for signing checks and documents on behalf of the company
• Evaluates the success of the organization
• Reports to the board

Admin and HR Manager

• Responsible for overseeing the smooth running of HR and administrative tasks for the organization
• Maintains office supplies by checking stocks; placing and expediting orders; evaluating new products.
• Ensures operation of equipment by completing preventive maintenance requirements; calling for repairs.
• Defines job positions for recruitment and managing interviewing process
• Carries out staff induction for new team members
• Responsible for training, evaluation and assessment of employees
• Responsible for arranging travel, meetings and appointments
• Supervises the smooth running of the daily office activities.

Plant Manager:

• Responsible for overseeing the smooth running of the production plant
• Responsible for approving tractors and agricultural machinery designs and concepts
• Part of the team that determines the quantity of tractors and agricultural machinery and other products that are to be produced
• Maps out strategies that will lead to efficiency amongst workers in the factory
• Responsible for training, evaluation and assessment of factory workers
• Ensures that the steady flow of both raw materials to the factory and easy flow of finished products through wholesale distributors to the market
• Ensures that the factory meets the expected safety and health standard at all times.
• Interfaces with third – party suppliers (vendors) of raw materials
• Controls tractors and agricultural machinery distribution and supply inventory
• Supervises the workforce in the factory.
• Manages external research and coordinate all the internal sources of information to retain the organizations’ best customers and attract new ones
• Models demographic information and analyze the volumes of transactional data generated by customer purchases
• Identifies, prioritizes, and reaches out to new partners, and business opportunities et al
• Identifies development opportunities; follows up on development leads and contacts; participates in the structuring and financing of projects; assures the completion of development projects.
• Responsible for supervising implementation, advocate for the customer’s needs, and communicate with clients
• Document all customer contact and information
• Represent the company in strategic meetings
• Help increase sales and growth for the company
• Responsible for designing and manufacturing of farm tractors and attachments
• Harvesting equipment and machinery
• Irrigation equipment
• Sprayers and spreaders
• Powered agricultural mowers
• Livestock feeding and watering equipment

Accountant/Cashier:

• Responsible for preparing financial reports, budgets, and financial statements for the organization
• Provides managements with financial analyses, development budgets, and accounting reports
• Responsible for financial forecasting and risks analysis.
• Performs cash management, general ledger accounting, and financial reporting
• Responsible for developing and managing financial systems and policies
• Responsible for administering payrolls
• Ensures compliance with taxation legislation
• Handles all financial transactions for the organization
• Serves as internal auditor for the organization

Client Service Executive/Front Desk Officer

• Welcomes guests and clients by greeting them in person or on the telephone; answering or directing inquiries.
• Ensures that all contacts with clients (e-mail, walk-In center, SMS or phone) provides the client with a personalized customer service experience of the highest level
• Through interaction with clients on the phone, uses every opportunity to build client’s interest in the company’s products and services
• Manages administrative duties assigned by the manager in an effective and timely manner
• Consistently stays abreast of any new information on the company’s products, promotional campaigns etc. to ensure accurate and helpful information is supplied to clients
• Receives parcels/documents for the company
• Distribute mails in the organization
• Handles any other duties as assigned by the line manager

6. SWOT Analysis

Darren Stanley™ Agricultural Equipment Manufacturing Company, Inc. employed the services of a core professional in the area of business consulting and structuring to assist our organization in building a well – structured tractors and agricultural machinery manufacturing business that can favorably compete in the highly competitive industry in the United States

Part of what the business consultant did was to work with the management of our organization in conducting a SWOT analysis for Darren Stanley™ Agricultural Equipment Manufacturing Company, Inc. Here is a summary from the result of the SWOT analysis that was conducted on behalf of Darren Stanley™ Agricultural Equipment Manufacturing Company, Inc.;

Our core strength lies in the power of our team; our workforce. We have a team of creative and highly proficient agricultural machinery manufacturing engineers and technologists, a team with excellent qualifications and experience in various niche areas in the industry.

Aside from the synergy that exists in our carefully selected agricultural machinery manufacturing technologists and engineers, we have some of the latest and efficient tractors and agricultural machinery and of course our work output and products will be guided by international best practices.

As a new tractors and agricultural machinery manufacturing company in Lake Tahoe – Nevada, it might take some time for our organization to break into the market and gain acceptance especially from the government and other high – profile clients in the highly competitive industry; that is perhaps our major weakness. Another weakness is that we may not have the required cash to promote our business the way we would want to.

• Opportunities:

Private investment in computers and software signals a greater focus on technological change. In particular, this investment has an effect on demand for industry products. As connectivity- and autonomy-supporting technology advances in farm equipment, consumers are incentivized to purchase new equipment to take advantage of efficiency gains.

The level of investment in computers and software is expected to rise in the coming year, representing a potential opportunity for this industry. Expected technological advances are forecast to incentivize new purchases.

Many tractors and related machinery products are purchased on credit. When interest rates increase, demand for new products from this industry generally decreases due to higher financing costs. Farmers’ inability to purchase equipment at a high prime rate drives down demand and impedes industry growth. The prime rate, a proxy for all interest rates, is expected to rise in the coming year, representing a potential threat to this industry.

7. MARKET ANALYSIS

• Market Trends

Over the five years to 2015, the US farming segment has also experienced growth in corporatization and consolidation. Price competition has particularly resulted in major consolidation within the industry, causing many smaller industry players to exit the market, as larger players acquire the smaller companies.

Demand for large tractors over 100 horsepower has gone up in response to this trend. Profit is expected to remain stable over the five-year period to 2022 as rising labor productivity will help maintain profitability.

Recent trends in the agricultural machinery manufacturing industry shows that rise and fall in market prices are key factors that affected by supply, demand, and the cost of goods/services sold. Higher demand or COGS will put upward pressure on prices. Higher competition among Tractors & Agricultural Machinery Manufacturing companies will put a downward pressure on prices.

8. Our Target Market

Before starting our agricultural machinery manufacturing company, we are certain that there is a wide range of both business and individual clients who will need our products. We will ensure that we develop strategic pacts with major players in the agricultural sector.

This will give us several options to generate revenue for our company. In view of that, we have created strategies that will enable us reach out to our target market and for the start, we will concentrate only on;

• Commercial crop farmers
• Cattle farmers
• Poultry farmers
• Hydroponic farmers
• Cow and calf operation business owners
• Fish and seafood farmers
• Fish hatcheries
• Tractors and agricultural machinery merchants
• Landscapers

Our Competitive Advantage

We are quite aware that to be highly competitive in the Tractors and Agricultural Machinery Manufacturing industry means that you are not only expected to be able to deliver consistent and highly efficient agricultural machinery, but you must be able to meet set targets. No one would want to continue to order products from you if your products are not reliable.

Our competitive advantage lies in the power of our team; our workforce. We have a team of creative and highly proficient tractors and agricultural machinery manufacturing technologists and engineers, a team with excellent qualifications and experience in various niche areas in the industry.

Aside from the synergy that exists in our carefully selected agricultural machinery manufacturing technologists and engineers, we have some of the latest and efficient production machines and equipment and of course our work output and product will be guided by international best practices in the industry.

Lastly, all our employees will be well taken care of, and their welfare package will be among the best within our category in the industry. It will enable them to be more than willing to build the business with us and help deliver our set goals and achieve all our business aims and objectives.

9. SALES AND MARKETING STRATEGY

We are not ignorant of the fact that there are growing competitions in the Tractors and Agricultural Machinery Manufacturing industry which is why we have been able to hire some of the best marketing experts to handle our sales and marketing.

Our sales and marketing team will be recruited based on their vast experience in the industry and they will be trained on a regular basis so as to be well equipped to meet their set targets and the overall business goal of Darren Stanley™ Agricultural Equipment Manufacturing Company, Inc.

Our goal is to grow Darren Stanley™ Agricultural Equipment Manufacturing Company, Inc. to become one of the leading agricultural machinery manufacturing companies in the United States of America which is why we have mapped out strategies that will help us take advantage of the available market and grow to become a major force to reckon with not only in Lake Tahoe – Nevada but also in other cities in the United States of America

Darren Stanley™ Agricultural Equipment Manufacturing Company, Inc. is set to make use of the following marketing and sales strategies to attract clients and win contracts;

• Introduce our tractors and agricultural machinery manufacturing company by sending introductory letters alongside our brochure to players in the agricultural sector and key stake holders in and around the United States of America.
• Promptness in bidding for tractors and agricultural machinery supply contracts from the government and other larger farming corporations
• Advertise our business in relevant tractors and agricultural machinery magazines, newspapers, TV and radio stations
• List our business on yellow pages ads (local directories)
• Attend relevant international and local expos, seminars, and business fairs et al
• Create different packages for different category of clients in order to work with their budgets
• Leverage on the internet to promote our business
• Engage direct marketing approach
• Join local chambers of commerce and industries to network and market our services
• Encourage word of mouth marketing from loyal and satisfied clients

Sources of Income

Darren Stanley™ Agricultural Equipment Manufacturing Company, Inc. is established with the aim of maximizing profits in the Tractors and Agricultural Machinery Manufacturing industry and we are going to go ensure that we do all it takes to meet and surpass the expectations of all our clients.

Darren Stanley™ Agricultural Equipment Manufacturing Company, Inc. will generate income by engaging in;

10. Sales Forecast

We are well positioned to take on the available market in Tractors and Agricultural Machinery Manufacturing industry and we are quite optimistic that we will meet our set target of generating enough income/profits from the first six months of operation and grow our company to enviable heights.

We have been able to examine the agricultural machinery manufacturing market, we have analyzed our chances in the industry and we have been able to come up with the following sales forecast. Below are the sales projections for Darren Stanley™ Agricultural Equipment Manufacturing Company, Inc., it is based on the location of our business and of course the wide range of our products and target market;

• First Fiscal Year (FY1): $1.2 million
• Second Fiscal Year (FY2): $2 million
• Third Fiscal Year (FY3): $4.7 million

N.B : This projection was done based on what is obtainable in the industry and with the assumption that there won’t be any major economic meltdown and there won’t be any major competitor offering same products and services as we do within same location. Please note that the above projection might be lower and at the same time it might be higher.

11. Publicity and Advertising Strategy

We have been able to work with brand and publicity consultants to help us map out publicity and advertising strategies that will help us walk our way into the heart of our target market. We are set to become the number one choice for both corporate and individual clients in the whole of the Lake Tahoe and beyond which is why we have made provisions for effective publicity and advertisement of our company.

Below are the platforms we intend to leverage on to promote Darren Stanley™ Agricultural Equipment Manufacturing Company, Inc.;

• Place adverts on both print (newspapers and magazines) and electronic media platforms
• Sponsor relevant community – based events/programs
• Leverage on the internet and social media platforms like; Instagram, Facebook, twitter, YouTube, Google + et al to promote our services
• Install our Bill Boards in strategic locations all around Lake Tahoe – Nevada
• List our tractors and agricultural machinery manufacturing company in local directories / yellow pages
• Advertise our tractors and agricultural machinery manufacturing company in our official website and employ strategies that will help us pull traffic to the site.
• Ensure that all our staff members wear our branded shirts and all our vehicles and trucks are well branded with our company logo et al.

12. Our Pricing Strategy

At Darren Stanley™ Agricultural Equipment Manufacturing Company, Inc. we will adopt all the pricing system as is obtainable in the industry but we will ensure that we keep the prices of our agricultural machinery and after sale maintenance services a little below the average market rate by keeping our overhead low and by collecting payment in advance from our customers. In addition, we will also offer special discounted rates to all our customers at regular intervals.

• Payment Options

The payment policy adopted by Darren Stanley™ Agricultural Equipment Manufacturing Company, Inc. is all inclusive because we are quite aware that different customers prefer different payment options as it suits them but at the same time, we will ensure that we abide by the financial rules and regulation of the United States of America.

Here are the payment options that Darren Stanley™ Agricultural Equipment Manufacturing Company, Inc. will make available to her clients;

• Payment via bank transfer
• Payment via online bank transfer
• Payment via mobile money
• Payment via Point of Sales Machines
• Payment via check
• Payment via bank draft

In view of the above, we have chosen banking platforms that will enable our clients make payment for our agricultural machinery and after sale maintenance services without any stress on their part. Our bank account numbers will be made available on our website and promotional materials.

13. Startup Expenditure (Budget)

This is what it would cost us to setup Darren Stanley™ Agricultural Equipment Manufacturing Company, Inc. in Lake Tahoe – Nevada, U.S;

• Business incorporating fees in the United States of America will cost – $750.
• The budget for Liability insurance, permits and license will cost – $3,500
• Acquiring a standard production facility that will accommodate the number of employees for at least 6 months (Re – Construction of the facility inclusive) will cost – $350,000.
• The amount needed to purchase the needed production machines and raw materials – $1.2 million
• Equipping the office (computers, 3D printing machines and equipment, servers / internet facility, furniture, telephones, filing cabinets, and electronics) will cost – $150,000
• Amount required to purchase the needed software applications – $ 3,500
• Launching an official Website will cost – $500
• Amount need to pay bills and staff members for at least 2 to 3 months – $70,000
• Additional Expenditure such as Business cards, Signage, Adverts and Promotions will cost – $5,000

Going by the report from the market research and feasibility studies conducted, we will need about $2.5 million to successfully set up a medium scale agricultural machinery manufacturing company in the United States of America.

Generating Funds/Startup Capital for Darren Stanley™ Agricultural Equipment Manufacturing Company, Inc.

Darren Stanley™ Agricultural Equipment Manufacturing Company, Inc. is a family business that will be owned by Mr. Darren Stanley and his immediate family members. They decided to restrict the sourcing of the start-up capital for the business to just three major sources.

• Generate part of the startup capital from personal savings and sale of his stocks
• Generate part of the startup capital from friends and other extended family members
• Generate a larger chunk of the startup capital from the bank (loan facility).

N.B: We have been able to generate about $700,000 (Personal savings $500,000 and soft loan from family members $200,000) and we are at the final stages of obtaining a loan facility of $1.5 million from our bank. All the papers and documents have been duly signed and submitted, the loan has been approved and any moment from now our account will be credited.

14. Sustainability and Expansion Strategy

Part of the plans we have in place to sustain Darren Stanley™ Agricultural Equipment Manufacturing Company, Inc. is to ensure that we continue to make available quality and reliable agricultural machinery, after sales maintenance services and improvise on how to do things faster and cheaper.

We are not going to relent in providing conducive environment for our workers and also the required trainings that will help them deliver excellent services at all times.

We are quite aware that our customers are key components to the growth and survival of our business hence we are going to continuously engage them to give us ideas on how to serve them better. We will not waste time in adopting new technology, best practices and diversifying our services.

Our key sustainability and expansion strategy as a business is to ensure that we only hire competent and technically sound employees, create a conducive working environment and employee benefits for all our staff members. We know that if we implement our business strategies, we will grow our agricultural machinery manufacturing business beyond Lake Tahoe – Nevada to other states in the U.S in record time.

Check List/Milestone

• Business Name Availability Check : Completed
• Business Incorporation: Completed
• Opening of Corporate Bank Accounts: Completed
• Opening Online Payment Platforms: Completed
• Application and Obtaining Tax Payer’s ID: In Progress
• Securing a standard production facility plus renovation of the facility: Competed
• Application for business license and permit: Completed
• Purchase of Insurance for the Business: Completed
• Conducting Feasibility Studies: Completed
• Generating part of the startup capital from the founders: Completed
• Writing of Business Plan: Completed
• Drafting of Employee’s Handbook: Completed
• Drafting of Contract Documents: In Progress
• Design of Logo for the business: Completed
• Secure trademark for our products: In Progress
• Printing of Packaging Marketing/Promotional Materials: Completed
• Recruitment of employees: In Progress
• Purchase of the needed tractors and agricultural machinery production machines and other equipment: Completed
• Purchase of the needed furniture, office equipment, software applications, electronic appliances and facility facelift: In progress
• Creating Official Website for the business: In Progress
• Creating Awareness for the business: In Progress
• Health and Safety and Fire Safety Arrangement: In Progress
• Establishing business relationship with vendors and key players in the agricultural industry: In Progress

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Farm Machinery Manufacturer Sample Business Plan

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Click here to view this full business plan

Farm Machinery Manufacturer Business Plan

Executive summary.

Kouros Brothers Ltd. is an agriculture machinery and implements manufacturer importer and authorized reseller that sells A-Z series of heavy machinery and systems for Potatoes, Vegetables, Cereals, Stubble, and beach cleaning turn key projects and machinery. We have also patented and piloted four innovative machinery and systems the last 6 years for Vegetable and Cereal productions. Is also the sole and exclusive agent and dealer of 10 main agriculture manufacturers in Europe. It has managed to create communication links and to export its series of machinery in Middle East and Syria the last 3 years.

Kouros Brothers Ltd. has an experienced management team with direct knowledge of the industry, extensive research experience, and unique administrative skills. Its team includes Mr. Kouros and Mr Panikos Stella live in Larnaca, Cyprus. Both Owners have compiled an extensive list of customers/potential customers, vendors, and contacts for equipment consignment.

New Opportunity Last week it was announced by the Ministry of Agriculture, Natural Resources and Environment that EU has available 256 million Euro for funding from 65%-80% of all units or producers intending to modernize and use technological advances in order to improve customers’ (Agriculture Producers’) product quality and to be able to export goods into European markets at competitive prices.

We have a good reputation locally, but sales are slow because local farmers cannot buy new equipment every year. With Cyprus’ admission to the EU, this large amount of funding will let farmers buy more and newer equipment. However, the local farmers will only buy equipment they know to be effective; the best way to convince them, in our experience, is to bring a sample of equipment to their fields to demonstrate.

Kouros Brothers Ltd. has good earnings and assets, but we do not have enough cash on hand to buy the wide range of demonstration equipment we need to meet the sales potential created by the upcoming Government funds to our customers. The company intents to employ local individuals and to provide extensive training about its products and services in order to promote its sales. Loyal customers help to expand the company’s business area by word-of-mouth.

We have already identified a list of potential customers and communities that are willing and able to try its new product series. Even more so, the pilot equipments will be used for the upcoming October International fair for Agriculture and Livestock that will take place, at Nicosia, Cyprus. And also, the company plans to participate in the Thesalloniki state Agricultural fair that will take place on the 28th January next. As a sole agent and sales representative for Cyprus, Greece and Syria for some series of Wheat planting systems, the company needs to promote its series of products to all available marketing opportunities.

The company is seeking funding of the amount of £50,000 for the purpose of expanding the business. Expansion plans include the purchase of additional equipments allowing the company to promote and to demonstrate its products and services, and also by hiring additional personnel. This loan will be paid back in 6 years, with principal payments of £5,833/year, at 8.5% interest. This is on top of the existing 10,000 loan, which will be paid back on the same time frame, at roughly £1,666/year.

With this new demonstration equipment, and well-funded customers, our projected revenues for Year 1 are expected to reach £274,200, and up to £400,000 by Year 5.

1.1 Objectives

The Kouros Brothers Ltd. directors believe that, there is a current untapped market opportunity for agriculture machinery because, existing providers of agriculture machinery and implements are too diversified to serve the increasingly specialized needs of the potato segment, by ignoring the crop needs for mechanization of Vegetables, Cereal, wheat and livestock sectors.

The company’s coverage area is constantly increasing, as customers are becoming aware of the company’s presence. European community offers a real business opportunity for such expansion, because now, there are 256 million Euro available for agriculture funding and support by EU agriculture committee, left to the Cyprus Government, to fund the Local Farmers and Agriculture producers for upgrading their production effectiveness and efficiency.

1.2 Mission

Kouros Brothers Ltd. mission is to become THE exclusive full-service equipment manufacturer and authorized importer, sales, and service company in agriculture machinery and implements in Cyprus and to expand its business to Middle East, with the ability to satisfy all needs of Livestock farmers and Agriculture producers.

Therefore, the company’s strategy is to create a limited geographical niche for itself, where there will be no potential competitors. Kouros Brothers Ltd. aims to offer high-quality agriculture equipments and machinery for crop mechanization of potato, vegetables and wheat crops at a price which is competitive in comparison to other premium-quality commercial machinery manufacturers in the local market.

1.3 Keys to Success

Kouros Brothers Ltd.’s keys to success will include:

• A high level of quality in its product line.
• A-Z equipment mechanization series for Vegetables, Cereals, Potatoes & Livestock.
• Maintaining and growing its referral networks to generate new and repeat sales.
• Significant investments in research and development of machinery with the aim to focus on precisely controlled equipment (Coriander seed, carrot machines etc.).
• Improving efficiencies of operations and to reduce the crop producers operating costs.
• Link with Consulting offices for Agriculture and Scientific support to its Customers.
• The machinery and Systems of Kouros Brothers Ltd. aim to help Cypriot farmers and Agriculture producers to export their products in the European market and to obey all European directives for product quality.

Company Summary

Kouros Brothers Ltd. is a manufacturer of heavy Agriculture equipments and Euro, with one location in industrial Estate area, Larnaca. The company began its operations since 1963 with little capital investment. The company combined 40 years of experience in the Agriculture machinery and Implements field to generate a large customer base, where until recently owned 80% of the local Potato machinery market.

The company is specialized into Potato planting and mechanization. After Cyprus accession into EU the company’s Directors decided to expand their field of products and to diversify into Cereal, vegetables and livestock. Kouros Brothers Ltd. hopes to initially make a successful effort to secure start-up financing to implement a new business opportunity.

2.1 Company Ownership

Kouros Brothers Ltd. is a limited liability company. Mr. Kouros Stella Zither, Mr. Panikos Stella, and Mr. Andreas Stella are the shareholders, owning 66%, 26% and 8% of the share capital, respectively.

2.2 Location & Facilities

The company has one office currently located in Industrial Area, at Our Town. The factory is only 3.5 kilometers from the center of town and is located on the front line of the industrial area. It has a 500 sq. meter showroom and is visible from the main road.

The factory has 3000m2 of shop floor area, where all manufacturing equipments and facilities are located and used for either maintenance or manufacturing of equipments and implements.

The factory facilities are open from 07:00 – 17:00 hours, Monday to Friday. The company does receive after hours calls or on weekends and provides assistance as needed.

2.3 Company History

Kouros Brothers Ltd. was founded in Our Town, Cyprus in 1963, to manufacture and to sell a complete A-Z series of potatoes crop mechanization. The company was formed by the Stella Zither family: Mr. Kouros Stella Zither, Mr. Panikos Stella, and Mr. Andreas Stella.

Kouros Brothers Ltd. has its principal offices and manufacturing unit of 3000 m2 , located at Our Town, Industrial estate area, Cyprus.

We have good earnings and Capital Assets (the value of the land and store), but do not have enough cash on hand to buy new samples of the equipment to demonstrate their effectiveness to farmers.

Products and Services

Kouros Brothers Ltd. is a manufacturer and Authorized dealer of imported Agriculture machinery and implements. The company is a manufacturer of the Potato A-Z mechanization such as Potato Planters, Diggers, Harvesters, Inter row cultivators, Taper Machines and Potato Fork-lift tractor mounted machines, Soil Preparation Machinery and Implements, Cereal Machinery and Implements, Transplanting machinery, Irrigation systems, Vegetable small seed planting machines, Wheat and Barley mechanization, Animal food factory and packing systems and Fire Fighting units designed for Agriculture areas.

Kouros Brothers Ltd. takes pride in having brought several new items for Livestock and Vegetable equipments that were otherwise unknown, such as the manure spreader machines, Cereal mechanization, and soil preparation machines. We also have designed and patented a new vegetable seed planting machine for Coriander, Onions, Beans, peas, broad beans, ground nuts, garlic, etc.

Kouros Brothers Ltd. has obtained the authorization to be a distributor for Beach Cleaning machines (French Patented systems). We are also a sole agent for beach creating technology and systems implementation.

Cereals In the case of cereals, the farmers plant 50-120 kgs of seeds per hectare, while they could have the same results and even more production with 18 kgs seed per hectare. Cereal planting systems can save up to 70-100 kgs seed that is wasted in each hectare without reason.

Stubble Cultivator Implement Stubble is an easy and inexpensive food for cows, sheep and other animals, and it decreases the use of fertilizers by 50%. Farmers who acquire the knowledge to increase stubble create their own forage, with the utilization of stable and barley.

If stubble is left in the fields, it can cause serious problems to the Wheat producers. The result is that soil is overloaded, there is a decrease of the fertility of soil and there is a continuous danger of fires which can burn hundreds of hectares of virgin forests and cause disasters to the environment as happens very ofter in summer. (EU directives have forbidden field-burning.) Our unique Stubble cultivator machine can increase Wheat production and also can decrease the producer’s operating costs. By not exploiting stubble, farmers waste of tens of millions of pounds per year.

Potatoes The potato producers lose huge quantities of potatoes that are abandoned in the fields without being collected, because they are only 5-10 cm below soil surface. From research, we found out that more than 1-1.5 tonnes of potatoes are abandoned in the soil in each hectare (1,000 t. meters), and in monetary terms we can say that the profit of the producer is abandoned in the field.

Our unique series of Potato mechanization systems and hectare that are exclusively manufactured into our Factory are tested for simplicity and are made with the best materials can warranty the potato quality and Low operating costs to the potato producer. These machines are satisfying the European directives requirements for Potato quality.

Livestock-farming The cows in Cyprus produce 4-5 tonnes milk per year instead of 10-12 tones per year. For solving such problems our company has created last year a Pilot System of Cereals that can increase cereal production up to 1,000 -1,500 kgs per hectare clover for the livestock-farming and mixing of hay and pellets.

Our company has all the mechanization series and the associates with technology and know-how for animal food preparation and production from Cypriot materials such as Lolium, Loutex, Maze, Vetch, AA and trefoil. Compost Machinery and Manure Spreader. Our Company has well-established European associates with the know-how and the technology to create compost, helping not only in farming sewage problems but also in quality of soil fertilization.

Wheat Planting Machines The Wheat producer, in order to plant seed into 100 hectares, needs to use 250 kgs of Seed and to go to his field at least 4 times. This means 4 times more operating costs and even more so, Wheat prices dropped by 40% with the Cyprus accession into EU.

Our machine is designed such that it can do all four processes–soil cultivation, fertilizing and planting on line, seed cover with soil and corrugation–in one go. The producer needs only 80 kgs per 100 hectares, instead of 250 kgs. Fertilizer is dropped just 1 cm from soil surface, reducing fertilization costs by 50%, because the fertilizer is not moved away by wind or rain.

Seed Vegetable Planting Machines Through research and development over the last 3 years, we have managed to create and to patent a unique Seed vegetable machine for a variety of vegetables such as onions, beans, garlic, coriander, etc. This machine is capable of planting all mentioned Vegetables by minimizing operational costs by up to 70% and can have the products made as per European Union directives as concern Size, Weight and Quality.

The company has already tested this machine for 3 years with several Cypriot vegetable producers and the results were beyond expectations. The machine has already been registered and patented rights are exclusively owned by our company. (Patent No. CY2351)

Market Analysis Summary

The overall market for agriculture machinery and implements is immense.

This business plan has identified over 1,800 agricultural producers and farmers in the local market that have a potential need to maintain and/or win customers or even more so are striving to survive. The funding schemes for agriculture and livestock support set by EU will allow them to stay competitive and this business opportunity is all about it.

Last week it was announced by the Ministry of Agriculture, Natural Resources and Environment that EU has available 256 million Euro for funding from 65%-80% of all units or producers intending to modernize and use technological advances in order to improve customers’ (Agriculture Producers’) product quality and to be able to export goods into European markets at competitive prices.

In reality, all agriculture and livestock businesses are in need of our products, because there are only 3 potential competitors locally who import or manufacture agricultural machinery and implements. Those involved with Potato mechanization have copied some of our unique series of products, whereas only 2 of them are involved with Cereal and Wheat implements. Kouros Brothers Ltd. has all machinery and implement series of equipments that will allow the Cypriot agriculturer and Livestock producer to stay competitive into European markets.

4.1 Market Segmentation

Our market segmentation scheme is fairly straightforward, and focuses on all agricultural and livestock sectors. The information contained in our customer analysis table is taken directly from the last statistics report published by the Ministry of Commerce and Industry and Tourism website and clearly shows that our largest market potential is more concentrated on the following sectors:

• Potato Crop Mechanization
• Cereals Crop Mechanization, including Wheat and Barley
• Vegetables crop Mechanization
• Packing Technology
• Livestock Machinery
• Beach Cleaning Machines and Beach Creation methodologies
• Fire Fighting Systems for rural areas

For more than 35 years, the company has owned almost 80% of the potato mechanization market. However, due to negative growth opportunities in this sector the last years, the prospects of this sector were unclear. Therefore, the company in order to survive has decided to invest in sectors such as new vegetable machine designs that will satisfy the vegetable producer needs (lower operational costs, low investment costs, simple machines, etc.) and also simultaneously through dealership of the main European agriculture machinery and implements manufacturers to become their sole agent and promoter in Cyprus and the Middle East area.

After 40 years of experience in agricultural machinery and implements manufacturing and design, the company has identified its strengths and weaknesses and has focused on vegetable, Cereals, Livestock and Beach Cleaning implements and technologies, allowing it to offer the same quality of service and support as are afforded by the larger businesses.

The strategy used for years was to bring in selected products, and then attempt to find a buyer. This resulted in inventory overstock, and obsolescence. The company already knows the customers’ needs and wants, therefore, as part of its marketing mix has decided to use the start up funding for buying a series of 6 main machinery that will have the most predicted demand and via marketing and promotion will try to promote its complete series of products.

After sales, services and spare parts provision to repeat customers is also part of our new Marketing strategy. The aim of the new marketing approach is to keep the existing customers and not to start building a new market share. Long-term relationships with customers is one of the key-success factors mentioned earlier and was one of the reasons that company survived and earned their business. The company expects that by implementing a correct marketing mix, we will increase our share in this market segment by offering the same value-added service and support benefits that its commercial clients demand.

4.2 Target Market Segment Strategy

Our choice of target markets is based on comprehensive experience within the agriculture industry coupled with an in-depth understanding of the customers’ needs for more than 40 years.

We have taken a unique approach to satisfy our customers needs and wants and also simultaneously to answer all their questions and to air their fears about the effectiveness and efficiency of our products. The company identified that only the on-site testing of the agriculture machinery in the customers’ fields could calm down even the most resistive and questionable customer.

The company cannot be successful by just waiting for the customer to come for ordering. Instead, we must focus on the specific market segments whose needs match more to our series of products. Focusing on targeted segments is the key to company’s future. Therefore, the company’s focus and marketing message will be not only the customer needs but also the after service and spare parts services offered. A good marketing mix will develop company’s message, communicate it, and fulfill its commitment to excellence.

Developing a market strategy is a departure from the way the company has been managed in the past. We will change the paradigm of being a product- and price-focused sales organization, to that of becoming a customer- and market-focused organization, aiming in sharing responsibility for customer satisfaction. We will accomplish this paradigm shift through the implementation of a balanced and continuous market research for agriculture needs and technology demands. Planning and implementing specific strategies for each of the seven identified segments will be an ongoing process, and we will will consult with marketing specialists, and our manufacturers, to further refine these efforts as we develop an effective marketing plan.

4.3 Competition and Buying Patterns

Our customers want equipment that works well. They are paying a great deal of their annual income to purchase a machine, and will not buy anything unless they have a clear demonstration that it works, or a recommendation about buying from another farmer they trust. The Cypriot farmer and agriculture producer is the last minute man. He plans to buy a machinery only when it is critical and necessary, and when he identify the need, he wants immediate delivery.

Kouros Brothers Ltd.’s closest competitors are located in Next Town, Other Town and Our Town. They include the following five companies:

All above listed competitors are offering standardized agriculture forbidden and implements for the potato industry and only 2 seek to satisfy somehow other sectors of the agriculture and Livestock Industry.

ExpertHub Staff

ExpertHub’s team of Staff Writers deliver unique, insightful and curated content from successful business leaders, authors and subject matter experts. This highly-experienced team understands the information that business readers are looking for, what’s unique and impactful, and how to distil key ideas into actionable insights.

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