Report of Tunnel Farming4

Business Plan Yazman Off-Season Vegetable Farm
In the Name of Allah,
The Most Beneficent,
The Most Merciful.
Read:
In the Name of your Lord
Who Created, Created Man from a Clot.
Read:
And your Lord is the most Bounteous,
Who taught by the pen,
The man that which he did not Know
Al-Quran
The Islamian Business Executives Page 1

“ALLAH DOES NOT LOOK AT
YOUR FORMS AND POSSESSIONS
BUT HE LOOKS AT YOUR
HEART AND DEEDS”
(MUSLIM)
DEDICATED TO ALLAH
The Almighty
The Omniscient
The Omnipotent
The Omnipresent
The creator of creative mind.
PREFACE
Department Of Management Sciences has always tried to make its
students be familiar with the different techniques in the field of

business in order that they can understand & present the concepts
of Projects in the light of present-day progress & development.
The important of principal work almost exists in every professional
field. Practical knowledge makes man a technical person who
enables to do every work promptly regarding his profession. The
very distributive feature of the degree of Business Administration is
that it stresses more on the practical aspects of study. Our teachers
have extremely realized this importance & he use all the tact’s to
expose us to the real field circumstances.
Entrepreneurship has become a common phenomenon now-a-days.
We have also endeavored to consolidate in this assignment all the
important features of the topic. Every effort has been made to
incorporate all the available means of information to make this
assignment exhaustive & comprehensive. We tried our best to
accomplish our work.
Acknowledgement

 Special thanks to Almighty Allah, creator of the

creative minds.
 We pay abundant thanks to our encouraging teacher &

instructor Mr. Tasawar Javed for enlightens our minds
with the rich information about the topic.
SPECIAL THANKS
 Ch. Islam
o Arian Zarai Farm. Dhnowt
 Mr. Jahanzaib Khan
 Mr. Salman Azhar
o Lecturer
 Mr. Naveed Ijaz, Dhnowt
1. Executive Summary
The Yazmzan Off-Season Vegetables is a business which deals with the off-season
vegetable farming. Business consists of two units, one in located in Chak No.
50/DB, Bahawalpur road Yazman and the other is located in Chak No. 103/DB, near
by Yazman. The sponsors of the project are professionally qualified and have
valuable and extensive experience of business management in industrial fields
namely Shahid Amin, Tariq Aziz, Hassan Raza, M.Khalid Aslam, M.Adeel and
M.Anayat Ullah. The purpose of this business is to provide high quality off-season

vegetables at reasonable prices. Our business plan consists on 6 acres and land
should get on lease. Musharakah agreement is made among the partners. All terms
of profit and loss distribution are clearly mentioned in the Musharakah agreement.
All partners have agriculture background, so we manage our bunnies effectively.
Vegetables can be cultivated in off-season, with the induction of an artificial
technique like tunnel technology, in which temperature and moisture is controlled for
specific growth of vegetables. Tunnel technology includes low tunnel, walk in tunnel
and high tunnel. GI pipes, wire, net and plastic cover are used in tunnel technology
as an infrastructure requirement. Different types of vegetables are grown in tunnel
farming like tomato, cucumber, pepper, egg plant, etc. but we focus only on
cucumber, tomatoes, capsicum and bitter grounds. All inputs are available locally.
Hybrid seeds should be used which are also available locally. Off-season
vegetables pass through in different steps like nursery, field preparation, plantation
etc. Mostly off-season vegetables are grown in winter season. For operations we
require 2 additional supervisors and 4 workers. Mostly labor should use on daily
wages because in sowing and picking season more labor is required.
We conduct market research because it is necessary to identify customer and their
needs and wants. Our major market is local while in local we focus in Bahawalpur
and Rahim Yar Khan. For delivery we use direct and indirect channels. For
promotion activities advertisement tool is used. Local news papers, FM, billboards,
etc. are used for advertisement. For further promotion free sampling may be used.
We also develop a webpage for our business which will help us in distribution and
promotion activities as well.
The estimated cost of our project is Rs. 3,507,772. Our total based is equity based.
All partners made equal investment. Our business plan’s estimated life is five
years. The estimated profits for first three years are Rs. 759287, 1213384 and
1929812 respectively. Our business may be fail due to different reasons, so, we must
manage it effectively to avoid its failure.

2. Introduction
2.1. Importance of Vegetables
Vegetables are major source of vitamins, carbohydrates, salts and proteins. With
increased health consciousness in the general public and changing nutritional
patterns, vegetables are now becoming an essential part of common household’s
daily food. In addition, high population growth rate has also given rise to high
demand in basic nutritional vegetables. Vegetables are used in raw form as salad or
cooked food according to the taste, which provide a balanced diet and keep human
being healthy.

2.2. Project Brief
The importance of vegetables cannot be denied due to their nutritional value. There
is a huge demand for fresh vegetables in the local as well as international
markets. The facility of growing off-season vegetables also allows for growing
non-conventional varieties and vegetables, which are in high demand in the
nationals and international market. Increased health awareness, high population
growth rate, changing food patterns and availability of packaged vegetables, has
therefore generated a year round high demand for vegetables in the country in
general and in major city centers in particular. However, our farmers have yet not
been able to exploit this opportunity and still follow conventional sowing and picking
patterns. This results in highly unstable vegetable supply market wherein the market
is saturated with seasonal vegetables irrespective of demand existence on one
hand and very high priced vegetables in off-season on the other. Lack of developed
vegetable processing and storage facility robs our farmers from their due profit
margins. In natural season local vegetables flood the markets significantly bringing
down the prices. In the absence of storage Infrastructure and vegetable processing
industry in the country, off-season vegetables farming is the only feasible option that
can add value to the farmer produce.
The proposed project is designed as a small size off-season vegetable farming unit.
Off-season vegetables, such as, tomatoes, cucumber, Bitter Gourds and Capsicum/
Sweet pepper could be cultivated using walk-in tunnel technology on 6 Acres. The
target customer’s for off-season vegetable are hotels and restaurants and general
people. Products will follow proper distribution channels to reach to their actual
consumers.
2.3. Why we Select tunnel Farming
Agriculture sector is the backbone of Pakistan’s economy. The sector employs 44 %

of the work force and contributes 24.7% towards National GDP. Allah has blessed
our country with fertile land and suitable environment for growing variety of
vegetables. The geological location of the country is ideally suited for a large variety

of agricultural crops, which are used directly for food as well as a raw material for
processing industry. Vegetables grown in Pakistan are distinctive in taste, fragrance
and are almost natural as very low quantity of chemicals is used in their cultivation.
On other hand our own family background is agricultural. All the partners belong to
countryside and have agriculture experience.
3. General Company Description
3.1. Vision Statement
Our vision statement is as follows:
“To provide quality off-season vegetable to the consumers at affordable price”
3.2. Objectives
Our mission is to become the high quality supplier of off season vegetables by
earning a reasonable profit, expanding our business to other cities of the country.
We aim to make long term relations with our customers by proving best quality
vegetables grown by using unconventional methods. We are also looking ahead to
build cold storages to support our business.
3.3. Musharakah Business
We are starting business on small scale .We will start our business in the form of
Partnership under the Islamic mode of finance named as”MUSHARAKAH”
Musharakah Agreement:
The basic document which must be prepared to start partnership is the

Musharakah agreement. The mutual rights and duties, obligations of all partners
are documented in the shape of a “Musharakah agreement”. This needs to be
signed by all the partners and subsequent copies held by each partner. The
Musharakah Agreement is very much important because Allah Subhana-o-Tallah
ordered Muslims to write down dealings in order to overcome disputes. Musharakah
agreements contains following terms

1. The name of Musharakah Agreement business will be Yazman Off-season

Vegetable Farm.
2. Location of head office : our head office will be located in Ward No. 02
Mohalla Ismail Abad Yazman
3. Production Sites: We will start production initially at two sites in Yazman ,

one is located in chak no 103 D.B and other is Chak No. 50 D.B
4. Our business is about farming and its selling which we produce. Initially we
are going to start our business in Yazman, but in future we will expand it to
other areas of southern Punjab.
5. We are contributing to our business by ourselves. The Amount of capital

contributed by each partner equally. Detail is as in the table
Shahid Amin Tariq Aziz Hassan Raza M.Khalid Aslam M.Adeel M.Anayat Ullah
Rs.584629 Rs.584629 Rs.584629 Rs.584629 Rs.584629 Rs.584629

6. If further capital will be need then all partners will further invest. But if partner
will be unable to further invest we will make an agreement with Meezan Bank
under Musharakah.
7. The names and addresses of each partner;
Shahid Amin MBA (Finance)
Chak No.103/D.B Tehsil Yazman Bahawalpur.
M. Adeel MBA (Finance)
Ward No. 02 Mohalla Ismail Abad Yazman Bahawalpur.
Tariq Aziz MBA (Finance)
Chak No.20/DNB Tehsil Yazman Bahawalpur
Hassan Raza MBA (Finance)

Chak No. 92/1-L Tahsil Khanpur Distt. Rahim Yar Khan
M.Anayatullah Khan MBA (Finance)
Islami Colony Bahawalpur.
M.Khalid Aslam MBA (Marketing)
House No. 149/A Model town B Bahawalpur.
8. The duration of Musharakah is not fixed because fixation of tenure for

Musharakah is prohibited in Shari’ah.
9. Profit Sharing ratio will be
Shahid Amin: M.Adeel : Tariq Aziz : Hassan Raza : M. Anayat : M.Khalid
20 : 15 : 15 : 20 : 15 : 15
10. Although all the partners are working Partner but Shahid Amin and Hassan
Raza due to the difference of work will get more profit.
11. All the loss will be shared by all partners according to their capital
investment.
12. In the case of insolvency the valuation and treatment of goodwill will be
according to the Musharakah Rules.
13. Mixing of capital is not required .Shahid Amin, M.Khalid ,M.Adeel and Tariq
Aziz will invest capital in start .Other two will provide capital as and when
needed.
14. All capital will be in liquid form. No one will invest capital other than liquid
assets.
15. Provisions regarding the accounting system and the fiscal year to be used
according to the Musharakah Rules

16. Everything will be decided with mutual consent of all partners in all these
cases of retirement, death and admission of a new partner but will be
according Musharakah rules.
17. Roles should be strictly followed by all the partners so there will be no
dispute if the dispute goes long an arbitrator (Preferably an Alam-e-Din) can
be appointed with the mutual consent of all disputing parties.
18. In the case of breach of duty by one partner, other partners have power to
expel him from the firm but with mutual consent.
19. The keeping of proper books of accounts and periodical preparation of

accounts will be done according to the accounting Laws.
20. If any partner wants to leave Musharakah, He will have a right to sell his
share to other partners.
21. Document will be signed and kept by all the partners to prevent any future
misunderstanding and ill will.
22. At the time of liquidation all assets will be sold and amount will be distributed
among the partners equally.
4. SWOT Analysis
SWOT analysis is very important tool to evaluate the feasibility of project. We check
out the strengths, weaknesses, opportunities and threats.
4.1. Strengths
 Low cost
 Our own agricultural background
 High quality vegetable due to high quality seeds
 Totally equity based
 Fertile land canal irrigated land

 Well-educated management
4.2. Weaknesses
 Low market share in the beginning
 Lack of proper skills for off-season vegetable cultivation
4.3. Opportunities
 Expanding nationwide
 Hybrid seeds that provide higher yield can lead to lower unit cost.
 Off-season cultivation of high value vegetables will fetch better price

and provide continuous supply to the processing industries.
 Higher prices can be obtained by producing the right crops, at the right
times and of better quality. They may also depend on negotiating skills
and targeting high price buyers.
4.4. Threats
 Extremely bad weather conditions
 Pests/insects attack
 Floods / Rainstorms
 Change in government regulations
 High Competition
 Low output prices due to more supply
 Higher increase in input prices
 Absence of proper crop insurance.
 Lack of irrigation water

5. Industry Structure
The facility of growing off-season vegetables also allows for growing non-
conventional varieties and vegetables, which are in high demand in the national and
international market, almost all types and varieties of known vegetables are grown
in Pakistan. Vegetables can be cultivated in off-season, with the induction of an
artificial technique like tunnel technology, in which temperature and moisture is
controlled for specific growth of vegetables. The production of vegetables all around
the year enables the growers to fully utilize their resources and supplement income
from vegetable growing as compared to other normal agricultural crops. As the
landholding power of farmers is decreasing, they need to increase the productivity
of their available land, off-season vegetable farming is a way through which they
can attain higher profit margins from the crop.
5.1. Percentage Change in Prices
The main commodities in food and beverages which showed an increase/decrease

in their prices during May 2010 over April, 2010 are as under:
Commodities Increase/Decrease Commodities Increase/Decrease

% %
Potatoes 22.95 Meat 2.62
Onions (20.32) Chicken farm (4.66)
Milk powder 3.34 Honey 2.36
Tomatoes (7.07) Gram whole (2.64)
Milk fresh 3.78 Milk powder 3.34
Cooking oil (1.53) Wheat (2.50)
Jam, tomato, pickles & vinegar 6.82 Dry fruits 0.92
Vegetables (2.34) wheat flour (4.77)

Government of Pakistan Statistics division, Federal bureau of statistics (Monthly Review on Price Indices, May, 2010)

5.2. Vegetables which can be sown in Tunnel Farming
Growing under plastic is more competitive in today’s vegetable market, it gives

superior yields and early spring production. Following crops are high value
Vegetables.
 · Tomato
 · Pepper
 · Cucumber
 · Bitter Gourds
 · Squashes
 · Eggplant
 · Water melon
 · Brinjal
5.3. Methods of off-season Vegetables
There are number of methods to cultivate vegetables in off-seasons. Some are

explained as under: -
5.3.1. Natural Method
The off-season vegetables are grown in the areas where the environmental
conditions are suitable for both normal as well as for off-seasons vegetables. Winter
vegetables are sown in summer on hilly/semi hilly areas where climatic conditions
are positive for a particular vegetable. Like wise summer vegetables are grown in
winter season in the valleys. These vegetables are supplied to different markets by
using means of transportation. The transportation of crop over long distance
markets causes post-harvest losses. These disadvantages lead to the acceptance
of non-natural techniques of farming in off-season, nearer to markets to deal with
heavy shipping cost and to reduce post-harvest suffers.

5.3.2. Artificial Methods
Vegetables can be grown in off-season through non-natural methods, the details of

these methods are given below:
5.3.3. Growing Beneath the Sarkanda
This is a previous technique and is typically adopted close to the huge cities. The
major vegetables grown under this method are tomato, chili, cucumber, and bottle
gourd. The nursery of these vegetables is planted in October/November and a wall
of Sarkanda is affixed in the direction of North South, which protect plant from cold
winds and haze. This method of farming is not favorable because the growth of the
plant tends to be slow, as the plant does not receive required sunshine and desired
moisture.
5.3.3.1. Building of Green Houses
Through building green houses, the sunlight amount is controlled. The vegetables
under this technique are grown typically in the winter period. Here the temperature,
moisture, carbon dioxide, airing and irrigation etc. is controlled. Green houses can
be built of pure glass or of fiberglass substance. The main shortcoming in the usage
of this technique is intense capital cost.
5.3.3.2. Plastic Tunnel
Farming by this technique is gaining fame because of small cost and trouble-free
practice. Plastic tunnels are transparent which provides required sunlight to the
plants, and the plastic also plays a hurdle against the cool air in winter. Types of
plastic tunnels are as under;
5.3.3.2.1. Low Tunnel
It is cheaper than high tunnel but creates complexity for soil preparation, spraying
and picking. The tunnels are appropriate for cucumber sown flat bed, melons,
watermelons, bitter gourds, squashes, and snake gourds etc. The yield in this type
of tunnel is however low compared to high tunnels.

5.3.3.2.2. Walk-in Tunnel
Walk-in tunnels are lower than the high tunnels but they are gaining attractiveness
as they provide high yield compared to low tunnels. The tunnel is appropriate for
growing tomatoes, cucumbers, sweet pepper and hot pepper.
5.3.3.2.3. High Tunnel
High tunnel facilitates trouble-free entrance for soil preparation, picking and
spraying due to its width and height. The crop yield is maximum in this kind of
tunnel. The tunnel is appropriate for growing tomatoes, cucumbers and sweet
peppers
Selected tunnel method
We have selected walk-in tunnel. Details of walk-in tunnels are as under;
Table 1 Specifications of walk-in Tunnel
Pipe material Mild steel, zinc galvanized
Diameter 20 mm
Thickness Thickness 1.6 mm
Material Length 20 ft
Specification Mild steel, round in shape
Iron Rod Diameter 12 mm
Length 2 ft
Plastic 0.06 mm thick and 20 ft wide
Height Center 6 ft, Sides 2.5 ft
Tunnel Width 12 ft
Specification Lengths 190 ft
No. of tunnels 14 per acre

6. Operating Plan
Operating plan of our project is as under;
6.1. Land Required
Total Land utilization per Vegetable
Vegetables Acers
Tomato 2
Cucumber 2
Capsicum 2
Bitter Gourds(on sides of tunnels) In all 06 Acers
6.2. Material Availability
Tunnel material i.e. pipes, Plastic Sheet, Iron Wire, net, is available in local market
from different suppliers. So there is no problem of availability of such materials.
Seeds (Hybrid and Non-hybrid) both are used for off-season vegetable farming.
Major suppliers of hybrid seeds are;
• Mian Islam Arian Dhanowt Tehsil Kehror Paka Distt. Lodhran
• Mian Shadi Agricultural Material Company,
• Syngenta Pakistan Ltd
• Haji sons.
We will get seeds from Mian Islam Arain. Fertilizers are very important for any
crop. Fertilizers of all kinds are available locally. Pesticides of different natures are

also available locally. Water is available from canal or in case of shortage we can
get water with the help of tube well.
6.3. Production Flow Process
Production Flow of off-season vegetables:

The production flow of off-season vegetables is a little different for different

vegetables. But the main procedure remains same; which involve following steps:
1. Nursery:
It is very first step in tunnel forming, in this step seeds are sowing in a
separate plot. These nursery or sapling is used for further production.
2. Field bed preparation :
Land preparation is very important step in tunnel farming. If land is not

properly prepare then the vegetables failure chances are more or increase.
So land is properly prepared for cultivation of off-season vegetables. For
proper preparation of land the fertility of land increased.
3. Soil fertilizing:
Now-a-days fertilizers play a major role in agriculture sector. For the

cultivation of vegetables fertilizers are also used to maintain the land fertility.
Sometimes the wastage of animals is also used to maintain or to increase
fertility. So after the land preparation fertilizers are used for fertility.
4. Nursery transplantation:
When land is properly prepared and fertilized then next step is the
transplantation of nursery in the land or seeds are directly sowed in the
prepared land. Nursery must be transplanted in a proper sequence and
proper equal distance.
5. Moisture conditioning:
After the transplantation or seed sowing then level of moisture maintained in

the soil. Usually we use plastic sheet to maintain temperature and moisture.
Fatherly we gave water after a specific interval for moisture stability.
6. Plant protection:

With the passage of time plant protection is different at different levels. We

use pesticides or different chemicals from the protection of pests or other
diseases that effect plants negatively.
7. Top dress fertilizing:
For the growth of every vegetable or any other crop fertilizers are necessary.
Different types of fertilizers are used for the smooth growth of plantation.
8. Harvesting:
Harvesting of vegetables is very important step in off-season vegetables.

Vegetables are harvested/picked at various times as per the nature or the
requirement of plantation.
9. Grading:
After the harvesting the next step is the grading of vegetables. Vegetables
are grading or classifying into different varieties according to the quality like
high, medium and low quality vegetables.
10. Post harvesting aspects:
The main objective of every entrepreneur is to earn maximum profit. So, after
harvesting and grading vegetables are properly packed and stored in order to
get the maximum price.
11. Shipment/dispatch:
Shipment or dispatch of vegetables is the final step in production flow. At this

stage vegetables shifted to the required market through different means of
transportation. Our required market is local so we use tractor, delivery van,
truck, etc. for the shipment of our vegetables.

6.4. Plant and Machinery for Off-season
S.NO. DESCRIPTION No. of Units
1 Tractor 1
2 Rotavator 1
3 Ridger 1
4 Soil-leveler 1
5 Spray Machine 2
6 Tube Well 2
7 Computer 1
8 Peter-Engine 2
9 Vehicle 1
Note: details of cost are given in financial portion.
6.5. Vegetable Other Infrastructure Requirement
Per Acre Total

Sr. No. Description Requirement Requirement
1 G-I Pipe Length 20 feet 280 1680
2 Wire-14 Gauge 220 1320
3 Building and other Civil Work
6.6. Utilities Required
• Electricity
• Diesel (for tube well operations)
• Water

• Telephone
• Fax
• Computer and internet facility
6.7. Sowing and Picking period of Off-Season Vegetables
Vegetables Sowing period Picking period
Tomato October (Nursery) February-May
November (transplantation)
Cucumber End of October to end of Mid January to May
December
Capsicum Mid of September to 1st End of January to
week of October September
End of October to 1st week
of
November (Transplantation)
Bitter Gourds January to 1st week of End of March to august

February
6.8. Expected Production and Land Utilization
Land Production Quantity Total Production Sale Price

Vegetables
Utilized Per Acre. 40kg Quantity. 40kg Per 40kg
Cucumber 2 1500 2800 480

Tomatoes 2 600 1200 600
Capsicum 2 400 800 600
Bitter Gourds (Extra

Vegetable with others) 6 80 480 800
7. Human Resource Management Plan
Our HRM plan is as under;
7.1. Organizational Structure
7.2. Management
General Manager
Hassan Raza will act as a general manger and will be responsible for management
of business,
Manager Accounts

M.Adeel will act as accounts manager and will be responsible for maintaining books
of accounts of our business.
Manger production
Shahid Amin will be production manager. He will be responsible for smooth

production of vegetables.
Manger Marketing
M.Khalid Aslam will be our marketing manager. He will be responsible for all
marketing activities of the business.
Manager Personnel
Tariq Aziz will be personnel manager and will be responsible for hiring and training
of workers. He will also responsible to forecast and mange workforce according to
demand.
7.3. Staff Requirement
Two supervisors will be appointed to check and control the production.

Rs.9000/month/supervisor salary will be given.
7.4. Labor Requirement
Labor requirement are not consistent in our product due to the nature of project.
Demand of labor varies with time. At the time of construction of tunnel we have
large number of labor; same case is the time of transplantation and picking. So due
to this varying demand it is not possible /feasible to hire permanent labor. So we will
hire four permanent workers at Rs.7000/month/worker. At the time of tunnel
construction, nursery transplantation and picking we will hire worker on contract.
8. Marketing Plan
Marketing plan is very important part of business plan. Before making marketing
plan market research is conducted.

8.1. Market Research
Market research is a very important aspect of any new business. We try to find
target market, competitors, market growth and market share (expected) with the
help of market research.
8.1.1. Target Market
In consideration for market size there is no exact figure which you can predict but as
the other businesses have idea of the market, our market size comprises of
Bahawalpur and Rahim Yar Khan. But after some time it will increase to other cities
of the southern Punjab. The entire households are our target market and we will
also supply vegetables to the hotels and restaurants of our target area.
8.1.2. Percent share of the market
The percent of market capture incase of off-season vegetable will be more than
10% of Bahawalpur and Rahim Yar Khan because there are already competitors in
our region in off-season vegetable farming.
8.1.3. Current demand in target market
There is a great demand for off-season vegetable and existing vegetables farm are
hardly fulfill demand of target population. The demand of vegetables is increasing
due to increase in population and increase in the prices of chicken, mutton, beaf
and other food items.
8.1.4. Customers
We are directly targeting hotels and restaurants, and households. There are number
of hotels and restaurants in Bahawalpur.
 Age
o Peoples of all age group
 Gender

o Male and Female both
 Location
o Restaurants of all types, House use
 Income Level
o People of all income levels because our vegetables will be available at

reasonable price.
 Education
o All peoples either they are literate or illiterate
8.1.5. Competitors research
Our main Competitors are:
• Drashak Agriculture farm, Jalal Pur Road Lodrahan.
• Main Islam Arian Agriculture farm,Dhanwot Tehsil Kehror paka Lodrahan
• Jahanzaib khan
• Some other small growers
8.2. Marketing Mix
Marketing mix contains following factors (known as 4p’s)
8.2.1. Price
The pricing section of the marketing plan involves determining how you will price
your product or service; the price you charge has to be competitive but still let you
to create sensible revenue.

The keyword here is "reasonable"; you can charge any price you want to, but for
every product or service there's a limit to how much the customer is willing to pay.
Your pricing plan needs to take this consumer threshold into consideration. In our
business market forces are price setter but we will try to charge price lower than our
competitors in order to capture market.
8.2.2. Product
We have developed our product to fulfill the demand and desire of people of
Bahawalpur.
Product Line
We have developed our product to fulfill the demand and desire of people of
Bahawalpur.
Our product line consists of four vegetables namely;
 Tomato
 Cucumber
 Capsicum
 Bitter Gourds
8.2.3. Place
Location for off-season vegetable farming at Bahwalpur road Yazman is in the

centre of our target region. We can easily supply vegetables to market, retailers and
direct customer. By the adoption of this place the purpose of delivery is
accomplished in better way. The fertility of land will generate a quality vegetable.
The location is very famous for land forming.
The effectiveness of distribution coverage and practice is of paramount importance

in achieving the desired off-season vegetable sales. Understanding of the
distribution channels is crucial in order for the manufacturer to plan and implement
an effective distribution strategy. Our study shows that the distribution of our
products is to be done through multiple channels involving, wholesalers, retailers

and users. While it is the common practice for the individual customers to buy the
products from the retail outlets; Commercial buyers such as tourist hotels and other
restaurant would normally place orders directly with the producers and wholesalers.
8.2.4. Promotion
Advertising and Promotion part of the marketing plan describes how you're going to
deliver your distinctive Selling offer to your potential clientele. For this purpose first
of all we need a channel through which we can deliver our message to our target
population. This is done through advertising.
8.2.4.1. Advertising
Advertising can be done by using different medias like the Internet , television
,radio, newspapers, magazines, telephone ,books/directories, billboards,

bench/bus/subway ads, direct mail, cooperative advertising with wholesalers,

retailers or other businesses.
As for as our business is concerned, we are gong to do business in a local territory

so we will use media that is effective at local level. We have planned to use
following methods for advertisement.
 Local news papers
o Sada-e-yazman, Daily Sutluj and Daily Bahawalpur
 Billboard
o We will use billboard on our production site on Bahawalpur

road Yazman.
 Local FM radio
o We will advertise our farm by using local FM radio
 Saraiki Awaz 105
 Jewey Pakistan 98
 Broachers/hand bills
 Stickers
o Small stickers on vegetables contains name of our farm
 Labels on packaging of vegetables
8.2.4.2. Sales Promotion
We will also use promotional activities to boost up our sale and to capture market
share.
 offering free samples
 point of purchase displays
 product demonstrations
8.2.4.3. Business Webpage
We have planned to make a website of our business. This will play a major role in
the in distribution and advertising as well.
www.yazmanagrifarm.com
9. Financial Plan
The total cost of our project is as under;
Sr. No. Description Total Cost Rs.
1 Cost of Civil Work 1,179,000
2 Estimated Cost of Plant and Machinery 1,615,272
3 Furniture and Fixture 30,000
4 Initial Charges for new Electricity Connection 55,000
5 Web-site Charges 3,500
6 Pre-Operating Expenses 25,000
Estimated Fixed Cost 2,907,772
Add: Net Initial Working Capital 600,000
Total Estimated Cost Of Project 3,507,772
Our financial plan is as follows;

Financial plan
Description LCY FCY Total Cost Rs.
Total Fixed Cost of the Project 2907772 - 2907772
Initial permanent working capital 600000 - 600000
Total cost of the project 3507772 - 3507772
Long term Debt 0 - 0
Equity Participation 3507772 - 3507772
Total Capital Required 3507772 - 3507772

Financing details are as under;
Rs.584629 Rs.584629 Rs.584629 Rs.584629 Rs.584629 Rs.584629
10. Reasons for Failure
Our business of tunnel farming will be fail due to following reasons:
 Natural disaster
 Shortage of inputs
 No proper overcome on pests

 No innovation with that is the requirement of customers
 Lack of knowledge about agriculture and tunnel farming
 Delay in decisions or no proper planning and decision making
 Poor financial and marketing system
 May be our business fail due to high competition that we could not
meet.
 Our business also fails if no proper inputs are used

How we get overcome on these reasons of failure?

We overcome above reasons by using following techniques:
 We use inventory system to overcome the shortage of inputs
 Use good quality pesticides
 Use new technology and bring innovation
 We use cost leadership and differentiation strategies to gain the competitive edge
 Attend different agriculture workshops for getting update knowledge about

agriculture and tunnel farming
 Audit must be conducted to make financial system effective

11. Annexure
Yazman Off-Season Vegetable Farm
Estimated Cost of the Project
Sr. No. Description Total Cost Rs.
1 Cost of Civil Work 1,179,000
2 Estimated Cost of Plant and Machinery 1,615,272
3 Furniture and Fixture 30,000
4 Initial Charges for new Electricity Connection 55,000
5 Web-site Charges 3,500
6 Pre-Operating Expenses 25,000
Estimated Fixed Cost 2,907,772
Add: Net Initial Working Capital 600,000
Total Estimated Cost Of Project 3,507,772
Financial plan
Description LCY FCY Total Cost Rs.

Total Fixed Cost of the Project 2907772 - 2907772
Initial permanent working capital 600000 - 600000
Total cost of the project 3507772 - 3507772
Long term Debt 0 - 0
Equity Participation 3507772 - 3507772
Total Capital Required 3507772 - 3507772
Six partners should be contributing and all partners contribute on equal basis. So,
each partner contributes following amount:
Rs.584629 Rs.584629 Rs.584629 Rs.584629 Rs.584629 Rs.584629
Estimated Cost of Plant & Machinery

S.NO. DESCRIPTION No. of Units Per Unit Cost Rs. Total Cost Rs.
1 Tractor 1 500000 500,000
2 Rotavator 1 85000 85,000
3 Ridger 1 23000 23,000
4 Soil-leveler 1 18000 18,000
5 Spray Machine 2 8300 16,600
6 Tube Well 2 150000 300,000
7 Computer 1 15000 15,000
8 Peter-Engine 2 43000 86,000
9 Vehicle 1 500000 500,000
10 Other Tools 40,000
11 Contingencies 2% 31,672
TOTAL 1,615,272
Cost of Civil Work
Per Acre Total Per Unit Cost Total Cost

Sr.
No. Description Requirement Requirement RS Rs
1 G-I Pipe Length 20 feet 280 1680 400 672000
2 Wire-14 Guage 220 1320 100 132000

3 Building and other Civil Work 375000
Total Cost Of Civil Work 1179000
Estimated Sales
Total Sale
Production
Land Production Price Total
Vegetables Quantity Per
Utilized Quantity. Per Sales
Acre. 40kg
40kg 40kg
Cucumber 2 1500 2800 480 1440000
Tomatoes 2 600 1200 600 720000
Capsicum 2 400 800 600 480000

Bitter Gourds (Extra Vegetable

with others) 6 80 480 800 384000
Total Sales 3024000
Cost of Raw Material

Cost Total
Per Cost
Per Acre Total
Requirement Requirement Unit Rs. RS.
Seeds
Cucumber (Seeds) 19000 38000 3.5 133000
Tomatoes(Plants) 14000 28000 2.4 67200
Capsicum (Packets) 14 28 1950 54600
Bitter Gourds
(Packets) 0.5 3 3000 9000
Total Cost of Seeds 263800

Fertilizers
DAP 4 24 2600 62400
Potash 4 24 2350 56400
Urea 2 12 910 10920
Total Cost of Fertilizers 129720
Pesticides Rs.20000 per acre 120000
Total Cost of Raw Material 513520
Depreciation Schedule of Fixed Asset
Sr. Dep.Exp.Rs
No Description Total Cost Rs. .
1,000,00
1 Tractor and vehicle@ 7.5% 0 75000
126,00
2 Rotavator, Ridger and soil-leveler @ 10% 0 12600
Spray Machine, Tube-well, Peter Engine and

3 Computer @ 20% 417600 83520
4 Furniture & Fixture (@ 20%) 30000 6000
5 Cost of Civil Work@ 20% 1179000 235800

Total 412920
Depreciation will be constant over the life of assets.
Year Wise Depreciation Years Rs.
2011 2012 2013
1 Dep.Expense 412,920 412,920 412,920
Estimated Income Statement
2011 2012 2013
Sales 3024000 3477600 3999240
Less: Cost of Sales
Raw Material (Seeds, Fertilizers and Pesticides) 513520 539196 566155.8
Direct Labor 399600 419580 440559
Plastic Cover and Netting 397860 417753 438640.7
Other Overheads (Repair and Maintenance, Fuel) 119880 125874 132167.7
Gross Profit 1593140 1975197 2421717
Less: Operating Cost
Admin Payroll 216000 226800 238140
Electricity 9600 10560 11616
Depreciation 412920 412920 412920
Amortization of Pre-operating Expenses 8333 8333 8334

Transportation Cost 35000 38500 42350
Other Cost (Advertisement etc.) 50000 52500 55125
Operating Profit 861287 1225584 1653232
Lease of land (102000) (112200) (123420)
Income from Income outlets - 100000 400000
Net Profit 759287 1213384 1929812
Key Assumptions:
 Overheads assumed 30% of Direct Labor
 Direct Labor calculated on daily basis and some permanent basis
 Sales increase 15% p.a.
 Direct labor and admin payroll increase 5% annually
 Pre-operating Expenses amortized in equal three years
 Lease of land increase 10% .p.a.
 Initially lease Rs.17000 per acre
 Electricity increase 10% p.a.
 Transportation and other cost also increase 10%p.a.
 Raw Material increase 5%p.a

Cash Flow Statement

End of Construction
Operating Years
Year
2010 2011 2012 2013
SOURCES OF FUNDS: Rs. Rs. Rs. Rs
861,28
- 1,225,584 1,653,232
Operating Profits 7
Add: Depreciation - 412,920 412,920 412,920
1,274,20 1,638,50
- 2,066,152
Total Funds from Operation 7 4
Other Sources:
Paid-Up Capital 3,507,772
1,274,20 1,638,50
3,507,772 2,066,152
Total Sources of Funds 7 4
APPLICATION OF FUNDS:
2,882,772 - -
Investment in Fixed Assets -
Financial Charges during Construction -
102,00
112,200 123,420
Lease on Land 0
Pre-Production Expenses 25,000
Financial Charges : -
PAYMENT OF: -
Taxes -
Dividends -
Short term Investment outlets - 500,000 1,500,000
Increase in Current Assets (Other than - 151,20 22,680 26,082

Cash) 0
253,20 634,88
2,907,772 1,649,502
Total Application of Funds 0 0
1,021,00
600,000 1,003,624 416,650
Cash Surplus/(Deficit) 7
600,00
1,621,007 2,624,631
Cash at the Beginning of the Year 0
1,621,00 2,624,63
600,000 3,041,281
Cash at the end of the year 7 1

Balance Sheet
End of Operating Years
Construction
2010 2011 2012 2013
ASSETS:
CURRENT ASSETS:
Cash and Bank Balance 600,000 1,621,007 2,624,631 3,041,281
Accounts Receivable - 151,200 173,880 199,962
Other Current Asset - 8,333 16,666 25,000
Total Current Assets 600,000 1,780,540 2,815,177 3,266,243
FIXED ASSETS:
Investment - - 500,000 2,000,000
Fixed Assets at Cost 2,882,772 2,882,772 2,882,772 2,882,772
Accumulated Depreciation on Fixed

- 412,920 825,840 1,238,760
Assets
Fixed Assets Net 2,882,772 2,469,852 2,056,932 1,644,012
Intangible Assets 25,000 16,667 8,334 -
Total Assets 3,507,772 4,267,059 5,380,443 6,910,255
LIABILITIES AND EQUITY:
CURRENT LIABILITIES:
Total Current Liabilities
LONG TERM DEBTS:
EQUITY:
Paid-Up-capital 3,507,772 3,507,772 3,507,772 3,507,772
Retained Earnings - 759,287 1,872,671 3,402,483

Total Equity 3,507,772 4,267,059 5,380,443 6,910,255
Total Liabilities and Equity 3,507,772 4,267,059 5,380,443 6,910,255
Calculation of Break-Even Point for 1st operating Year:
Variable Cost Fixed Cost Total Cost

Items
Rs. Rs. Rs.
Raw Material 513520 0 513520
Direct Labor 399600 0 399600
Overheads 59940 59940 119880
Plastic Cover and Netting 0 397860 397860
Depreciation 0 412920 412920
Electricity 9600 0 9600
Amortization of Pre-operating expenses 0 8333 8333
Lease of Land 0 102000 102000
Admin Payroll 216000 0 216000
Transpirations and others 85000 0 85000
Total 3024000 981053 2264713
Break-Even Point: Fixed cost / (Sales – Variable Cost) × 100

= Rs. 981053 / (3024000 - 3024000) × 100
= 56.37%
Assumptions:
 Overhead cost assumed 50% fixed and 50% variable

 Electricity cost assumed variable

 Transpiration cost is variable
Calculation of Internal Rate of Return (IRR)
Net Cash Net Cash NPV-53% NPV-58%

Capital Operating Depreciation
Years Return Inflow/(Outflow)
Outlay Rs. Profit Rs. Rs. Rs. Rs.
Rs. Rs.
0 2,907,772 - - - (2,907,772) (2,907,772) (2,907,772)
1 151,200 861,287 412,920 1,274,207 1,123,007 733,991.50 710,764
2 22,680 1,225,584 412,920 1,638,504 1,615,824 690,257.59 647,262
3 26,082 1,653,232 412,920 2,066,152 2,040,070 569,601.00 517,218
4 - 1,653,232 412,920 2,066,152 2,066,152 377,047.92 331,538
5 (3,391,243) 1,653,232 412,920 2,066,152 5,457,395 650,920.93 554,243
Total 114,047 (146,747)
IRR 55.097%

12. Bibliography
http://www.nation.com.pk/pakistan-news-newspaper-daily-english-
online/Regional/Islamabad/10-Feb-2009/Tunnel-farming-can-boost-farmers-income
[Online]. - Febraury 10, 2009.
http://www.scribd.com/doc/22398932/Feasibility-Report-of-Tunnel-Farming-in-
Pakistan [Online]. - 2007.
(May, 2010). Monthly Review on Price Indices. Government of Pakistan Statistics

Division, Federal Bureau of Statistics.
http://www.smeda.org/info.php?id=55 [Online]. - October 2007.
www.thenews.com.pk [Online]. - October 19, 2007.

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Business Plan Yazman Off-Season Vegetable Farm

In the Name of Allah,

The Most Beneficent,

The Most Merciful.

In the Name of your Lord

Who Created, Created Man from a Clot.

And your Lord is the most Bounteous,

Who taught by the pen,

The man that which he did not Know

The Islamian Business Executives Page 1

“ALLAH DOES NOT LOOK AT

YOUR FORMS AND POSSESSIONS

BUT HE LOOKS AT YOUR

HEART AND DEEDS”

The creator of creative mind.

students be familiar with the different techniques in the field of

The Islamian Business Executives Page 3

of Projects in the light of present-day progress & development.

The important of principal work almost exists in every professional

field. Practical knowledge makes man a technical person who

enables to do every work promptly regarding his profession. The

very distributive feature of the degree of Business Administration is

that it stresses more on the practical aspects of study. Our teachers

expose us to the real field circumstances.

Entrepreneurship has become a common phenomenon now-a-days.

We have also endeavored to consolidate in this assignment all the

important features of the topic. Every effort has been made to

incorporate all the available means of information to make this

assignment exhaustive & comprehensive. We tried our best to

accomplish our work.

The Islamian Business Executives Page 4

 Special thanks to Almighty Allah, creator of the

 We pay abundant thanks to our encouraging teacher &

The Islamian Business Executives Page 5

The Islamian Business Executives Page 6

2.1. Importance of Vegetables

The Islamian Business Executives Page 7

2.2. Project Brief

2.3. Why we Select tunnel Farming

Agriculture sector is the backbone of Pakistan’s economy. The sector employs 44 %

The Islamian Business Executives Page 8

3. General Company Description

3.1. Vision Statement

Our vision statement is as follows:

“To provide quality off-season vegetable to the consumers at affordable price”

3.3. Musharakah Business

The basic document which must be prepared to start partnership is the

The Islamian Business Executives Page 9

1. The name of Musharakah Agreement business will be Yazman Off-season

3. Production Sites: We will start production initially at two sites in Yazman ,

5. We are contributing to our business by ourselves. The Amount of capital

Rs.584629 Rs.584629 Rs.584629 Rs.584629 Rs.584629 Rs.584629

7. The names and addresses of each partner;

Shahid Amin MBA (Finance)

Chak No.103/D.B Tehsil Yazman Bahawalpur.

M. Adeel MBA (Finance)

Ward No. 02 Mohalla Ismail Abad Yazman Bahawalpur.

Tariq Aziz MBA (Finance)

Chak No.20/DNB Tehsil Yazman Bahawalpur

Hassan Raza MBA (Finance)

The Islamian Business Executives Page 10

Chak No. 92/1-L Tahsil Khanpur Distt. Rahim Yar Khan

M.Anayatullah Khan MBA (Finance)