FEASIBILITY REPORT ON SNAIL FARMING

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Product Category: Feasibility Study

Product Code: 00005707

No of Pages: 32

No of Chapters: 4

File Format: Microsoft Word

Price :

₦5000


ABSTRACT

This feasibility study on the setting up of a 200 capacity snail farm was conducted to determine if the business idea was feasible and to assess its impacts on the people. The business was named Evergreen Snail Products and Services Nigeria Limited (ESPS). It made available good quality and a very prolific Achatina achatina species of the African giant land snail that provided a substantial source of protein to complement our usual carbohydrate meals. The ESPS was run on both part and full time basis and with a startup capital of N250, 000. From this startup capital, a working capital of N240, 487.7 was used in running the business out of which a capital assets of N64, 000 was invested in for use in five years. The remaining N9512.3 were kept in bank and used in maintaining the business and for other miscellaneous expenses. The working capital and capital assets gave the initial outlay of N240, 487.7.The first year’s estimated sales and net profit indicated a high success with N505, 947.7 cash inflows. The Evergreen snail business is a sole proprietorship medium scale enterprise aimed at consolidating and expanding the outdated snail farm in the state through increased provision of required products and services. Snail slurries are useful industrially for zymolyse enzyme production. Snails contain less fat and cholesterol therefore; its consumption helps in improving the circulatory system and standard of living of the people. The venture provided employment to all categories of people including retirees, house-wives, young school leavers, inventors, traders, local dwellers, applicants, and workers who need extra income to augment their merge salary. It generates foreign revenue without one running from pillar to post. The SWOT analysis showed that the opportunities of the business outweigh the challenges and was concluded that the snail farming business idea is healthy and feasible. 

 

Key words: SWOT analysis, employment, foreign revenue, zymolyse, Bori.

 

           

 

 

 

           

 

TABLE OF CONTENTS

1.0      INTRODUCTION

1.1.     BACKGROUND OF THE STUDY

1.2.     BRIEF HISTORY OF SNAIL

1.3.     VISION AND MISSION FOR THE BUSINESS IDEA

1.3.1. Vision of the business:

1.3.2. Mission of the business: 

1.4.     Objectives of The Business

1.5.     PROJECT DESCRIPTION

1.5.1. Business Idea:

1.5.2. Conceptualizations of idea:

1.6.     Feasibility Of The Study (SWOT analysis)

1.6.1. Strengths:

1.6.2. Weaknesses:

1.6.3. Opportunities:

1.6.4. Threats:

1.7.     LOCATION AND WHY 

1.7.1. Location:

1.7.2. Reasons for the locations:

1.8      MARKET ANALYSIS  

1.8.1. Industrial analysis:

1.9.     MARKETING STRATEGY

1.9.1. Product:

1.9.2. Price:

1.9.3. Place:

1.9.4. Promotion:

1.10.   DEMAND AND SUPPLY

1.11    MARKET SHARE (GAP ANALYSIS)

1.12.   FORM OF BUSINESS AND ITS ESTABLISHMENT

1.13.   LEGAL FORM OF THE BUSINESS

1.14.  ORGANIZATIONAL STRUCTURE OF THE BUSINESS 

1.15    MANPOWER REQUIREMENT

1.15.1. Manpower cost:

1.16.   TECHNICAL ASPECTS

1.16.1. Plant and machinery Requirement: 

17.   RAW MATERIALS INPUTS REQUIRED FOR THE BUSINESS


2.0      BUILDING PROCESS

2.1.     Phase one:

2.2.     Phase two:

2.3.     Phase three:

2.4.     Phase four:

 

3.0      PRODUCTION PROCESS

3.1.     Buying/Collecting:

3.2.     Feeding:

3.3.     Maintenance:


4.0      INFRASTRUCTURE REQUIREMENTS

4.1.      ENVIRONMENTAL ANALYSIS

4.2.      PROJECT TIMELINES

4.3.      LEGAL AND REGULATORY FRAMEWORK

4.4.     BUSINESS RISKS ANALYSIS

4.5.     STRATEGY TO MITIGATE THE RISKS

4.6.      ECONOMIC AND SOCIAL JUSTIFICATION

4.7.      EMPLOYMENT GENERATION

4.8.      PROVISION OF PRODUCTS AND SERVICES

4.9.      FOREIGN EXCHANGE SAVINGS

4.10.           (1A). DIRECT COSTS OF THE BUSINESS

4.11.   (1B).      DIRECT LABOUR COST

4.12.   (2). INDIRECT COSTS

4.13.   DEPRECIATION 

4.14.   PROPOSE SOURCES OF FINANCING THE BUSINESS

4.15    FINANCIAL PROJECTIONS: 3-5YEARS

4.16.   LEGAL AND REGULATORY FRAMEWORK

4.17.   PROJECT RISK ANALYSIS 

4.18.   STRATEGY TO MITIGATE THE IDENTIFIED RISKS

4.19.   ECONOMIC AND SOCIAL JUSTIFICATION

4.20.   PROVISION OF PRODUCT AND SERVICES

4.21.   IMPORT SUBSTITUTION

4.22.   THE MAJOR SETBACKS  

APPENDIX I: NUTRITIONAL VALUE OF SNAIL

APPENDIX II: FINANCIAL PROJECTIONS

CASH FLOW PROJECTIONS

Cash flow plan

CALCULATION FOR NET PRESENT VALUE (NPV)

SENSITIVITY ANALYSIS

NPV SENSITIVITY AT 15%

IRR CALCULATION

PROFITABILITY INDEX, PI

P1 OR BCR calculation

PAYBACK PERIOD (PB)

DISCOUNTED PAYBACK PERIOD (DPB)

ACCOUNTING RATE OF RETURN (ARR)

REFERENCES





 

1.0 INTRODUCTION

It is clear generally that unemployment is unacceptably high and that it is here to stay except we do something about it. The Nigerian economy as it is presently run does not have the capacity to absorb chains of thousands of unemployed youth. In other words, the Nigerian graduates of today can no longer rely on the Nigerian labour market to provide him or her job. He has to invent an alternative source of employment which is self-employment or entrepreneurship. Entrepreneurship is in accordance with the Nigeria’s economic recovery programme objectives that necessitated a radical shift from total dependence on government for white collar job to self-employment. An entrepreneur is a person that perceives business opportunities, takes advantage of the scarce resources, bears the non-insurable risks in his enterprise and directs the human and material resources in his business objectives.

To qualify as an entrepreneur, it is not just sufficient to be a business man just managing an enterprise. You are an originator of profitable business ideas. It is against this background that I have chosen this very attractive area of self-employment called snail farming or heliciculture. It is one of the easiest and least expensive types of farming that provides employment opportunities to all categories of people and generates foreign revenue without you running from pillar to post. Snails farming business are healthy, less risky, less expensive and environmentally friendly.  

 

1.1. BACKGROUND OF THE STUDY

In the face of serious and growing threat of graduate unemployment in Nigeria today, the need for the Nigerian graduate of today to seek avenues for self-employment and self-fulfillment now seems impelling. In the 1960’s the problem of unemployment in Nigeria was basically that of primary and secondary school leavers. One popular explanation then was that these school leavers were ill-equipped and lack specific skills to offer the labour market. The explanation is now irrelevant today as even well equipped graduates in almost all disciplines now find that the Nigeria labour market no longer has enough jobs for them.

Thus rather than employees vainly searching for skill that are there, the situation has become one of the skill vainly searching for jobs that are not there and this call for entrepreneurship. ‘‘It was not as if I was particularly enamoured of the snail farming business idea but, at least, this is the only area I can say I had training that I can apply with ease and there was space to practice it’’. The study was designed to determine the feasibility of snail farming in Bori, Rivers State, Nigeria and to assess the impacts of entrepreneurship on the people therein.

 

1.2. BRIEF HISTORY OF SNAIL

The African giant snail (Achatina achatina) has coiled shells in their adult stage. They are hermaphrodite and so, they do not require a partner to copulate. They are oviparous and can lay eggs between 10 and 30days after mating. Eggs laying takes place during the rainy season or when provided with the required food, which are mostly juicy vegetables, constant water, a favourable weather condition of an average of 250C  to 300C and humidity of 80%. The species lays about 200 to 400 eggs in one batch 2 to 3 times a year. It takes about 11 days for its egg to be hatched in the humus-rich soil. All species of snail get matured for harvesting by the 5th to 7th months and are actually ready for consumption or marketing. Snails could live as long as 7 to 10 years in their natural habitat. Snails have different names for examples the French snail (Escargot) and the American Pomode.

The Roman snail (Helix pomatia), the garden snail (Helix aspersa) and the African giant land snail (Achatina achatina and Achatina fulica).Snails produce enzymes zymolyse used industrially to lyse the cell wall of organisms, thereby breaking the genetic barrier and allowing mating and fusion of otherwise two non compatible organisms.One interesting things about snails is that they have no noise, no adour, no irritation and hardly fall sick. Snail business is therefore a GEM in the kingdom livestock and the risks of production are low

 

1.3.   VISION AND MISSION FOR THE BUSINESS IDEA

 

1.3.1. Vision of the business:

1.           To contribute my quota to reduce graduate unemployment in Nigeria by engaging myself in this viable venture of snail farming.

2.           To expose the idea of snail farming in Nigeria as great income opportunities and to show people on how to prosper through it despite the economy.

3.           To direct employees on how to augment their income without affecting their present job.

4.           To practice the adage that says “the more we are in the league of millionaire the merrier it becomes and the better for the peace and prosperity of our Nation”.

5.           To let people know that Nigeria is greatly blessed with resources yet unexplored and to reveal the economic importance, nutritional composition and medicinal values of snails.

6.           To promote and encourage bilateral relation between Nigeria and other countries by way of trade.

7.           To reduce financial crises in our society and encourage sole trader business through example and practice.

8.           To improve the standard of living of people through the provision of highly prolific Achatina achatina snail that does not contain fat and cholesterol.

9.           To transfer the technology to retirees, house-wives, young school leavers, inventors, traders, local dwellers, applicants, Family Economic Advancement Programme (FEAP) / NGOs and workers who need extra income to augment their merge salary.

 

1.3.2. Mission of the business:  

1.           A strong desire for self-employment

2.           A desire for responsibility and independence (i.e.; financial independence).

3.           A desire for the glamour attached to entrepreneurship.

4.           A high need for achievement and success through personal innovation and speculation.

5.           A yearning desire to fulfill the needs of others.

6.           A need for self-satisfaction and fulfillment through proving to oneself that: “I have the ability to take risks, maneuvers   over it and succeed”.

7.           A desire to contribute my quota to the stimulation of Nigeria’s economic growth.

8.           A desire for power that a position of business leadership will give.

9.           A desire to equitably distribute the snail meat to places of needs for various purposes

10.        Running a business provides endless challenge and opportunity for learning.

11.        A desire to be a creator and master of my fortunes – i.e., by deciding my own work programmes, work hours, what to produce, where to produce and for whom to produce. In order word, a desire to be the sole arbiter of my fitness to establish and run a business

12.        A desire to pressure and conserve the very highly prolific species of Achatina achatina snail for future reference, research purposes, recreational activities and medicinal uses.

1.4. Objectives Of The Business

1.           To expand and consolidate the outdated snail farm in the Bori, so as to enhance productivity, reduce unemployment, facilitate Nigeria’s economic growth and reduce youth restiveness in the state.

2.           To champions the production of a very highly prolific species of snail that can lay about 200 to 400 eggs in one batch 2 to 3 times a year.

3.           To accumulate a lot of wealth, fame, social distinction and recognition from the use of my talents and energies in building and managing a successful snail farming enterprise of my own.

4.           To acts as the technological base of the economy which reveals microeconomic facts pointing to developments that would enhance income parity, raise capacity utilization of industries, lower inflation by producing more competition.

5.           To invent an alternative source of employment which is Self Employment/Entrepreneurship, thereby becoming self reliant, selfsufficient and self-dependent.

6.           To improve the standards of living of the general populace through improve production of snail species that is low in fat and without cholesterol. Hence, improving the circulatory system and Health of the citizenry.

 

1.5. PROJECT DESCRIPTION

 

1.5.1. Business Idea:

The business idea was the setting up of a 200 capacity snail farm business in Gure town, Bori City, Rivers State. The snail farm was located at Koro Farm Garden (KFG) in Gure Community while the business office was 34 mayor streets, Bori in Khana Local Government Area of Rivers State.

1.5.2. Conceptualizations of idea:

Reasons for chosen the business:

1.  It is a practicable and viable venture yet unexplored in Nigeria.

2.  This technology has been approved to most lucrative farming venture presently, as it requires far less capital investment, which much profit is being generated in a considerable short period.

3.  Virtually every part of snail is of vital use in food, pharmaceutical, manufacturing and fishing industries.

Snail farming has lower risk compared to other livestock farming.

4.  The demand for snail is higher than its supplies as such the market potential of snail is inexhaustible, locally and internationally.

5.  Snail as an export commodity, which has value next to gold on oversees countries. It is a foreign exchange income earner of our days.

6.  Rivers weather is one of best in snail breeding. Snail breeding has no stress, no time consuming, no odour, no noise and no irritation.

7.  If your startup capital is #100,000 for example, you can generate the sun of #1000, 000 in one year. Some people in other livestock may earn another #100,000, if they met no risk in a year.

8.  One can keep his present job and do this on a part-time since it doesn’t require much time. 

 

1.6. FEASIBILITY OF THE STUDY (SWOT analysis)

The SWOT analysis reveals the strengths, weaknesses, opportunities and threats of the business idea.

 

1.6.1. Strengths: The following constituted the strengths of the business:

1.           Adequate start-up capital

2.           Low risks of production

3.           Availability of high quality breeds of snails

4.           High demand for snails

5.           Good market potential

6.           Best location (area with fresh vegetation)

7.           Best weather condition

8.           Few competitors

9.           Availability of space

10.        Good communication network

11.        Good road network

12.        Adequate manpower (skilled and unskilled)

1.6.2. Weaknesses: The following are my weaknesses:

1.           Payment of taxes (e.g., sales tax, capital gain tax)

2.           Getting licenses and permits

3.           Registration (e.g., with corporate affairs commission, C.A.C)

4.           Insurance (Certain risks such as fire, export credit and accident will be insured) 

5.           Local competitors (e.g., rural dwellers)

6.           Obeying employers’ regulation (e.g., granting of sick leave, holidays to workers, settling of disputes).

 

 

1.6.3. Opportunities: The opportunities included:

1.           Collection of snail breeds is free. Especially during rainy seasons, snails are collected from under stones, damps, leaves and cover crops. 

2.           Snail feeding is simple. Snails are vegetarians and as such their feeds are very local, mostly juicy vegetables which are available in the area.

3.           It is easy to maintain. One only needs to change the feeds in the snail’s pen once a week to prevent rotting. Their pens are simply covered with nets to them from predators.

4.           As a part-time vocation, it can be successfully run alongside one’s actual job or other businesses.

5.           If a grower begins a snail farm with say 50 snails, it can produce averagely up to 250,000 adult snails worth over #500,000 in a year.

6.           The risk of losing snails in the farm is very low compared to other livestock farming.

7.           Rivers State has one of the best climates for snail rearing.

8.           Lastly, snails hardly fall sick, they are hermaphrodite; you don’t have to buy food, you don’t spent much to create an abode for them, they reproduce rapidly and are very important foreign exchange income earner of our days.

1.6.4. Threats: The basic threats to the business are mainly unsystematic risks including the following:

1.           Present of predators such as insects, birds, lizard, toad, frogs, nematodes, millipedes, ear wigs and fungi.

2.           Human interferences including vibration and unnecessary noise from automobiles and industries within.

3.           Harsh lighting torch, lanterns and sounds.

4.           Theft.

5.           Pens wetting especially during the dry season.

The other threats confronting the business are systematic and as such, the business shall be insured to overcome unstable government policies and regulations. From the SWOT analysis above, it is crystal clear that the opportunities of the business outweigh the challenges. Hence, the business idea is feasible and can be executed without you running at lost because the financial benefits levels out the challenges.

 

1.7. LOCATION AND WHY 

1.7.1. Location: The 200 capacity snail farm business otherwise named “Evergreen Snail Farm Nigeria Limited” was located at: 

Koro Farm Garden, Gure Community, Khana Local Government Area, Bori, Rivers State. The above address represented the site of snail rearing while the address below represented the marketing office:

No 34 Mayor Street, Off Rivers State Polytechnic Road, Bori, Khana L.G.A, Rivers State.

 

1.7.2. Reasons for the locations: These two locations were chosen after the SWOT analysis. The former address was selected based on the following reasons:

1.           Availability of space

2.           Availability of water and humus-rich soil

3.           Presence of juicy vegetables and aromatic plants as laurel that are used as feeds for snails

4.           Calmness and secure environment

5.           Access road and communication network

6.           Favorable weather condition for snail breeding

7.           Availability of manpower (both skilled and unskilled).

While the later location was selected based on:

1.           Large market size

2.           Good market potential

3.           Less number of competitors

4.           Presence of customers, both local and international

5.           Availability of labour

6.           Presence of inventors

7.           Closeness to Bori international market.

 

1.8    MARKET ANALYSIS  

 

1.8.1. Industrial analysis:

Industrially, Bori is one of the industrialized cities in Rivers State with good market potential. The city has several markets which ranged in size from 7800x9600cm to 12800x14400cm and 42200cm x 55500cm respectively. Local dwellers, investors and traders from all over south, east and west come to these markets to buy goods and services.

 

1.9. MARKETING STRATEGY

The marketing strategy adopted includes the “4 Ps” method. The “4 Ps” are:

1.           Product

2.           Price

3.           Place and 4.            Promotion.

 

1.9.1. Product: The matured snail shall be sold raw and also in its processed form. The processed snails shall be properly washed using alum and salt and weighed accordingly, refrigerated and supplied to entries, food stores, and place of need.

 

1.9.2. Price: The price for each adult snail depends on the weight and quality. For example, matured raw snail in-shell cost N 500 to N 600 per one while the same size of the processed snail cost N 600 to N 700 per snail respectively.

 

1.9.3. Place: The main production shall be Koro Farm Garden, where there is no noise but adequate maintenance including security. While the marketing office shall be in an open place, 34 Mayor Street, Bori where all my customers can have easy access.

 

1.9.4. Promotion: Both advertising and sales promotion shall be use. The nutrition benefit of snails will be made known. Discount shall also be given with respect to quantities purchased. Some dry snails shall be made available to customers who wish to taste the product.

 

1.10. DEMAND AND SUPPLY

The demand for snail meat and its products are higher than the supplies as such; the market potential of snail is inexhaustible, locally and internationally. My observation shows that out of 100% snail needed in Bori market for both local and international consumers in a year, only 68% was available. There is, therefore, the need for increased production in other to meet up the 100% snail demand.

 

 

1.11 MARKET SHARE (GAP ANALYSIS)

 My forecast for a period of one year shows that s total 100 units of snails was marketed in Bori market by both my competitors and me. Of these 100 units sold my business 60 units while the other competitors sold a total of 40 units all together in year ending. The Gap analysis, i.e., my market share is 70% while that of my competitors 40%. It was then concluded that my sales levels out that of my competitors and that they are seriously defeated. Hence, the business was successful. The “4 Ps” marketing strategy was used to achieve this high sale.

 

1.12. FORM OF BUSINESS AND ITS ESTABLISHMENT 

The business is a sole     proprietorship business. The idea was considered lucrative prior to its high income earning capacity and simplicity of operation.

 

1.13. LEGAL FORM OF THE BUSINESS

The legal form under which this snail farm business shall be organized is sole proprietorship. I will serve as the manager and chief executive officer (CEO) of the business coordinating the labours and day-today affairs. As a sole trader, I oversaw the production function, marketing function, personnel management function and other miscellaneous functions as showed in the organizational structure below:



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