The 5-year plan aims to enhance the livelihoods of farmers in the Heshuiping region of China through the Integrated Farmers' Association of Heshuiping (IFAH). Key elements of the plan include improving rural governance, increasing access to financial services and agricultural technologies, and expanding crop production and marketing efforts. The plan forecasts that household incomes could increase by 25% within 2 years through these initiatives. It also aims to stem rural-to-urban migration by creating more economic opportunities locally. The scope is focused on implementing this model through IFAH across the 37 villages in Sanli Township over 5 years, with the goal of eventually replicating it more broadly if successful.
Water Infrastructure Business - Cambodia, Feb 2012
IFAH 5-Year Development Plan
1. Global Young Leaders Programme
February 2011
Five-year
Five year development plan for
Integrated Farmers’ Association of Heshuiping Region,
Jianshi County Hubei Province China
County, Province,
1
2. TABLE OF CONTENTS
Contents Page Number
1. Executive Summary 3
2. Background 10
3. Objectives 21
4. Scope & Approach 23
5. Business Model 28
6. Financial Services 36
7. Governance 46
8. Production & Marketing 60
9. Community Services 72
10.
10 Implementation Plan 76
11. Risk Assessment and Mitigation 80
12. Recommendations 82
13. Appendices
13 A di 85
2
4. Executive Summary – Background
• The Integrated Farmers’ Association of Heshuiping Region (IFAH) was
founded in 2008, covering six villages, namely Nongke, Fengxiangshu,
, g g , y g , g g ,
Yangliu, heping, Chunfang and Cacapo, in Sanli Township, Jianshi
County.
• IFAH aims to protect the interests of farmers, enhance the knowledge
and skills of farmers, advance agriculture modernization, increase
farming revenues and improve the livelihood of farmers, develop rural
economy and social business, advance rural community development
and bring forth a new rural governance structure.
• IFAH’s mission is aligned both to the Chinese Government’s efforts,
and the Sanli Township’s 5 year development plan to enhance living
standards and income of the community
• YLP participants were tasked to create a business model that includes
rural governance to aid sustainable development in Sanli township.
g p p
5. Executive Summary – Business Plan
• A 5-year plan is proposed, with recommendations made on the governance
and financial model for IFAH, changes to crop aggregation and community
outreach programmes
t h
• A starting capital of RMB 1,000,000 is needed in the first year for the credit
department, and in five years, the cumulative capital will be RMB
$169,000,000
$169 000 000
• Breakeven is expected in the second year
• Gross Profit of RMB 4,300,000 is expected in the third year eventually
extrapolating to RMB 7 100 000 in the fifth year
7,100,000
• Average household income from farming is expected to increase by 25%
within 2 years of implementation
• Overall migration f
O ll i ti from rural t urban areas i expected t d li
l to b is t d to decline, b
based on
d
asset building and enhanced farming income
Demonstrating business viability for future extension
g y
of the proposed IFA model
6. Executive Summary – Operational
Recommendations
• Finance
– Introduce the Finance & Investment, and Credit Functions as IFAH’s
IFAH s
sole vehicle for provision of financial services
– Utilize money remitted by migrant workers to enhance IFAH’s capital
base
• Production and Supply Chain
– Review supply chain for pig farming, so as to aggregate and increase
revenue for farmers and IFAH
– Review crop/land allocation and expand fragrant rice production
Multi pronged approach to enhance income to
farmers
7. Executive Summary – Operational
Recommendations
• Governance
– Review IFAH team composition; enhance management bandwidth
bandwidth,
governance, risk management and transparency
– Review member leadership structure, from geography based leadership
to functional/crop based groups
– Enhance internal checks to ensure benefits to farmers
• Community Services
y
– Set up mechanism to train farmers on more effective farming, with a view
to enhancing the overall average household income
– Enhance healthcare awareness and cultural & educational activities
– Provide framework for creating positive environmental impact, e.g. waste
collection
Enhance IFA governance and community services
g y
8. Executive Summary
• The 5 year plan aims to:
– Enhance the average household income from farming in the Heshuiping
region (year 1 and 2) and eventually to the Sanli township (years 3
onwards) by 25% within 2 years of implementation
– Empower smallholder farmers by building confidence to join the
professional groups and support IFA
– Demonstrate that the model can be replicated across townships and
eventually at the county level
y y
– Make rural vocation/farming attractive thus reducing the migration of
workers to urban areas
– I
Improve environmental awareness, and h
i t l d have a positive i
iti impact on th
t the
local environment
10. China – A society built upon agriculture
• For over 8000 years, China's smallholder farming 1978 –
Decollectivization
agricultural b
i lt l base h played a k role i supporting th
has l d key l in ti the (free market
reforms)
growth of what is now the largest population of the world
1953 –
Commune
• Since 1978 and its open market reforms, China has
reforms System
become the world’s largest producer and consumer of
agricultural products; Currently, it produces 30% of the
world’s corn, 25% of the world’s cotton, 37% of the world’s
fruit and vegetables and half of the world’s pork
• Structural changes to the economy - despite the healthy
7500 BC –
expansion of the agricultural sector, the even faster growth Domestication of
rice/ rise of
of the industrial and service sector during the reform era has farming
begun to transform the rural economy from agriculture to communities and
accumulation of
industry and from rural to urban wealth
Source: http://www.iiasa.ac.at/Research/SRD/pdf/IR-03-007.pdf
10
11. Globalization and the growing rural-urban
divide
China’s rapid economic development and
industrialization h
i d t i li ti has created a growing gap
t d i
between rural and urban areas
– China’s urban population has increased from
China s
18.96 per cent in 197 to 46.60 per cent in 2009
– Per capita disposable income for urban residents
was RMB 17,175 compared to RMB 5,153 for
, p ,
rural residents
– Decrease of rural labor force – 80% to 50 % in
less than thirty years
• The reported urban: rural income ratio is currently
3.35:1 but in reality, the disparity could potentially
be as high as 6:1
Source: Consulting Center for Farmers’ Associations (CCFA)
11
12. Globalisation and the growing rural-urban
divide
• To find additional income, there has been an exodus of 200-300 million rural
migrants i t d
i t into developed coastal provinces and i d t i l cities as migrant
l d t l i d industrial iti i t
workers
– The migrants are mostly male and represent over a quarter of the rural farming
p p
population; an average of 1 p household
; g per
• Rural-urban migration together with the expansion of industry has resulted in
the
a) Breakdown of traditional village social structures (elderly and
children being left behind),
b) Continual decline of economic sustenance (local farming activities
plummet because of lack of labor, knowledge, leadership), and
c) Deterioration of the environment (urban sprawl and industry
development impacts)
• Families, crops, and land are abandoned for the seemingly more viable
option of urban life
12
13. A new way forward for rural China
• Currently, smallholder farms have little capacity to benefit from the
opportunities presented by the growth in the agricultural sector because
each farmer is allocated only 1.826 mu of farmland (less than 0.1 ha per
capita)
• However, if rural communities can successfully scale the collective efforts of
these farmers, the economic potential is over 100M mu of land (1/18 of
China’s arable land) and can provide a solution to the widening gap
between urban and rural areas
13
14. A new way forward for rural China
• Current efforts in China:
– Policy support is close to 1 trillion per y
y pp p year
of funding coming from central government to
improve infrastructure, living condition,
production capacity, social services
– Microfinance schemes to address bottom of
the pyramid funding for smallholder farmers
– Structural change both in the form of pilot
grassroots farming programs and research-
led technological innovation
Yet there is still a need for a modernization
model that addresses rural sustainability in
d l th t dd l t i bilit i
a holistic manner, and serves the
smallholder farmers.
14
15. Integrated Farmer’s Association of
Heshuiping (IFAH)
The Integrated Farmer’s Association of Heshuiping (IFAH)
was formed in ApriI 2008 as a strategic partnership between:
1. Chi
1 Chinese A d Academy of S i l S i
f Social Sciences P liPolicy
Research Center, Consulting Center for Farmer’s
Association (CCFA) led by Professor Yang Tuan
2. China Youth Development Foundation
3. B i ht Chi G
3 Bright China Group
4. China Social Entrepreneur Foundation
With the support of the Integrated Rural Development and
Governance Pil t P
G Pilot Programme Offi
Office, IFAH aims t b th fi t
i to be the first
model of rural governance that:
i. integrates the experience of farmers’ associations in
East Asia with the local best practices of asset-
based d
b d development
l t
ii. acts as an intermediary between government
bodies and the farming community that serves the
wellbeing of smallholder farmer economies in rural
China
Chi
15
16. The IFA Model from East Asia and its Potential for China
The Heshuiping model is based upon over 5 years of CCFA research
on existing IFA’s in Taiwan, Japan and Korea. Current East Asian
IFA’s h
IFA’ have several core f
l functions i l di
ti including: a) Distribution
b) production
• Needs provision – Farmers centered c) Supply
• Social enterprise function – Asset building, separation
of authority and function, internal wealth allocation
function
• Collective operation – High efficiency
• Agriculture extension and education Financial
Core services
The success and adaptation of the IFA pilot program in Functions
F ti
China can push forward social structural change in China
to ensure
• The sustainable development of society
Social
• Protect the ecology and environment
a. Education services
• Protect people’s health
b. Cultural
• Curb corruption and ensure the effectiveness of policies activities
• To promote civil society and realize democracy
Source: http://www.iiasa.ac.at/Research/SRD/pdf/IR-03-007.pdf
16
17. IFAH Membership Overview
• Currently, IFAH covers six villages in
the Heshuiping region of Sanli Township
Township, Heshuiping region
which is part of the 37 townships which
make up Jianshi County.
• It has 5000 members from 1320
households which make up
approximately 60% of the regional
resident population
Community
y IFAH Members Percentage
g
No. of villages 6 - -
No. of member groups - 64 -
No. of households 2050 1320 64.3%
No. of people 8180 5000 61.1%
17
18. SWOT Analysis
Strengths Weaknesses
• Strong support from Govt: Sanli mayor
g pp y • Limited management bandwidth
keen on agriculture development
• Limited financial resources
• Existing association and buy-in of farmers
• Farmers not aware of potential
• Support from Consulting Centre for benefits
b fit
Farmers Association (CCFA)
Opportunities
O ii Threats
Th
• Aggregation of products and services, • Scattered progress beyond the initial
e.g. pig farming produce, to improve 6 villages covered
livelihoods
li lih d
• Lack of demonstrable achievement
• Introduction of additional services like of IFAH in the immediate future
healthcare, insurance
• Inability to attract and retain talent
y
• Expanding beyond 6 villages
• Funding difficulty
19. Problem Statement
Key issues identified:
•PPrevalent poverty i the f
l in h farming community i H h i i region,
i i in Heshuiping i
current estimates of average household farming income (excluding
remittances) at around RMB 3,000 annually
• Lack of economic progress, accentuated by lack of access to
p g , y
capital, resources and technology
• Limited effective governance framework, management expertise,
and weak institutions
• Limited economic opportunities locally leading to an exodus of
workers to urban areas and resultant social issues
• Poor environmental awareness, and adverse impact on local
environment,
environment leading to long term issues
Need for effective rural governance to help
enhance farming income
h f i i
19
21. Objectives
• To alleviate poverty among the rural farmers in the Heshuiping area
• To create a framework and mechanism for effective rural governance and
sustainable growth
• To create a sustainable rural credit model for smallholder farmers
• To increase local household income from farming by utilizing better
practices and by aggregating local produce
• To stem the emigration of workers to urban areas, and to enhance
opportunities for asset based growth locally
• To empower smallholder farmers
• Create a framework that can be replicated in other townships and counties
• To enhance overall societal and environmental development
Creating a sustainable rural economy…
21
23. Scope
Scope of the business plan includes the following three essential
elements:
1 Township, • One farmers’ association for one township
• Focus on Sanli Township in Jianshi County
1 IFA •CCovers estimated 37 villages
ti t d ill
• Four key areas:
• 1) Governance 2) Production & Marketing
5-Year D
5Y Development
l t • 3) Finance 4) Community Services & Benefits
Plan for IFAH • Adapted from the East Asian models of Farmer’s
Associations (FA) from across Taiwan, Japan and Korea
• Two main stakeholders:
Implementation Plan for • The government of Jianshi County and the Integrated
Rural Development and Governance pilot programme
IFAH and Stakeholders office
• Consulting Center for Farmers’ Associations (CCFA)
Farmers
23
24. Key Considerations for Business Plan
Realisation
• The Business Plan is a key tool for IFAH to address immediate risks and
opportunities and implement the core building blocks to achieve its
objectives
• The Business Plan is NOT immediately intended to attract external
y
investors as IFAH do not have the requisite governance structures and
resources to move to immediate implementation
• The 5 year plan is focused on incubating the notion of self reliance
5-year
through existing available financial services by piloting business
operations expansion to the 37 Villages within the Sanli Township
• Upon successful realisation of th benefits of th pilot, th model can
U f l li ti f the b fit f the il t the d l
potentially be tailored to be scaled to Jianshi County as part of the next
stage of business expansion
24
25. Approach and Methodology
• GIFT scoping & preliminary due diligence for Global 7-9 Dec 2010
Young Leadership Program (YLP)
• Global YLP participants reviewed the background and the 19-21 Feb 2011
current approach of IFAH
• Interviews,
Interviews meetings and field visits with key stakeholders: 19-23 Feb
19 23 F b 2011
– Government Officials (county and township)
– Village Heads
– Member Group Leaders
– Farmers
– IFAH Management
– CCFA Members
– Bank Representatives
• Briefings and brainstorming 22 23
22-23 Feb 2011
• Calibration and clarification with key stakeholders 22-23 Feb 2011
• Project planning and mapping 23 Feb 2011
• Business plan development 23-24 Feb 2011
26. Approach and Methodology
Workshops on
W k h Briefings on
B i fi
Field visits
global issues background
Inspiring speakers YLP & IFAH Farmers & IFAH
Organizing & Final clarification with Debriefing &
Mapping relevant parties Discussion
YLP team Various parties YLP team
Continuingg
inputs from Business
Agreeing on
Content stakeholders plan
YLP team YLP team YLP team
28. A model of integrated and profitable
social enterprise
1) Self-sufficient revenue
Supported by Overarching Governance
model:
Sustainable Livelihood & – New credit financing
Social Impact business capitalizing on
Agricultural
remittance and deposits
Supply Chain from migrant workers
– Collection and distribution
Finance
Services
of key agricultural output
– Fragrant rice growing
IFA investment
2) Supporting governance
model to ensure management
transparency and farmers
p y
interests are protected
3) Delivery of community
service for improvement of
rural livelihood
29. Fully Integrated Business Model Across
Revenue and Cost Drivers
…enables positive return in the long term
enables
31. IFAH’S NET INCOME GROWTH FOR 5
YEARS
5 000 000
5,000,000 Net Income
• Annual Net Income
4,000,000
Growth in year 4-5: 26%
3,000,000
3 000 000
• Breakeven Point: 2 year 2,000,000
1,000,000
• Achie ing more than
Achieving
0
RMB 4 million in year 5
Yr 1 Yr 2 Yr 3 Yr 4 Yr 5
(1,000,000)
Growth potential is very high
31
33. Benefits
Financial:
• Increase average household income by 25%
• Increase revenue and productivity through better
utilization of resources and aggregation of
products & IFAH Financial Services
Community:
• Enhanced and more effective rural
governance
• Train farmers to enhance knowledge on
agriculture products and techniques
• Improve public health awareness
• Greater engagement and social interaction
33
34. Benefits
Social:
• Increase opportunities for enhance living
pp g
standards, using local resources effectively
• Reduce migration of workers to urban areas
Environment:
• Enhance sanitation
• Improve river water quality
• Enhance soil quality by
promoting use of organic
fertilizer
34
36. FINANCIAL SERVICES - OVERVIEW
• Focus on 5 Key Financial Services to
enable a sustainable and profitable
Business Model
• Existing Mutual Assistance Schemes in
Villages (eg. Ca Ca Bo and Yang Liu)
will eventually be absorbed into the IFA
Financial Services Model
• Undertake Central Claims Processing
for Tobacco Farmers
• Supported by sound supporting
processes for Financial Accounting
Accounting,
Financial Controls and overall IFA
Governance Model
• Enables effective collection, analysis
and management of key demographic
information to support the Public Aff i
i f ti t t th P bli Affairs
Function
Creating Value-Add and Streamlining Current Financial Services
g g
36
37. FINANCIAL SERVICES – CAPITAL MUTUAL
ASSISTANCE SCHEME
• Short Term (1-2 years) Financing
Scheme to fund Start Up Capital
Start-Up
• Pooling together smaller amounts from
farmers (approximately RMB500 to
RMB2000) with matching funds (up to
RMB500) from the government
• Funds used for Micro-Finance without
collateral at an annual interest rate of
7 to 10%
• Loan Term up to 12 months
Critical Step To Achieve Economic Self Reliance
37
38. FINANCIAL SERVICES – MICRO-FINANCE
• Micro-Finance Loan amount RMB Credit Function
5,000 to RMB 50,000 (without Credit Manager
collateral) Submit Applications
For Approval
After Credit Checks
Completed Approved
• Loans > RMB 50,000 will be secured Applications
through the Rural Credit Union under a Credit Processing Credit Credit Control
Disbursements
strategic partnership with IFA (with
collateral)
• Adjustable Interest Rates based on
Submit Application
Credit & Income Profile of Farmers Provide and Forms for Processing
Collect
Application Forms FUNDS
• Term Loan of approximately 1 year to 5 and Provide Education
& Awareness
years structured through short term Offer and
Funds
Disbursement
Signing of Offer
repayment Letter & Agreement
(Cash/Remittance)*
Group Heads
• Providing convenience through
empowerment of the IFA Group Heads Credit Monitoring
and Control
Provide and
Collect Farmers
Application Forms
and Provide Education
& Awareness
* Cash/Remittance to be used for Short Term. Once IFA obtains licence to receive
deposits the amount will be remitted directly to the farmers IFA Savings Account
38
39. FINANCIAL SERVICES – SAVINGS SCHEME
• Key integrator of Product Co-Operatives into IFA Business Model through means
of investment and shareholdings
• Facilitates establishment of strategic relationships with Commercial Banks/Credit
Unions
• Receive Deposits from farmers and migrant workers paying out an annual interest
rate of approximately 2.6%
• Providing convenience through aggregation of savings accounts maintained with
multiple financial institution
• Pooled Deposits to contribute to micro-financing and investment opportunities
• Providing farmers visibility and transparency of summary financial status and other
activities th
ti iti through t h l
h technology enablement ( F
bl t (e-Farmer Kiosk)
Ki k)
• Longer Term (> 5 years) scale to promote IFA as Integrated Service Centre i.e.
provide services to farmers such as direct debit facilities for bill payments
IFA as an Integrated Financial Service Provider
39
40. FINANCIAL SERVICES – SAVINGS SCHEME
The Savings Scheme is a Key Service Enabler for IFA as it represents the heart of IFA’s
business operations in effectively linking farmers, migrant workers, financial partners and co-
farmers workers
operatives in order to achieve supply chain and capital efficiencies and gains
40
41. FINANCIAL SERVICES – CENTRAL CLAIMS
PROCESSING
Finance & Investments
• Tobacco industry operates as a single Function
Finance Manager
monopoly in China through the
Chinese National Tobacco
Process Claims
Corporation (中国国家烟草公司) and Submit
For Approval
Approved
Claims
Withdraw
Reimbursement Financial Accounting
IFA Banking
g
• Central Claims Processing Ser ices
Services Account
Amounts
for Farmers
provided only to Tobacco Farmers
• Provides scale efficiencies in-line with Deposits monies
due to farmers
consolidation of mutual assistance
lid ti f t l i t into IFA
Banking Account
Submit
Claims on behalf of farmers Reimbursement
(Cash/Remittance)*
schemes into the IFA structure
Group Heads
• Farmers receive monies faster than if
directly interacting with the Tobacco
Hand over claims
Collection Centres Tobacco Collection Centre
to Group Heads
Deliver tobacco crops
Farmers
and obtain receipts
* Cash/Remittance to be used for Short Term. Once IFA obtains licence to receive
deposits the amount will be remitted directly to the farmers IFA Savings Account
41
42. FINANCIAL SERVICES – FINANCIAL
EDUCATION & AWARENESS
• Key Service Component which
underpins the Financial Services
Model and is a key input in the Risk
Management Process
• Integral part of Community Outreach
Programme by: b
– Providing Financial & Debt
Management Awareness
– Assisting Farmers to
safeguard and take control of
ownership over their financial
security
– Promote and Provide
P t d P id
Education on the Benefits of
IFA’s Financial Services
42
43. FINANCIAL SERVICES – SUPPORTING
PROCESS
Financial Accounting
• Day to Day
Day-to-Day Financial Operations
• Organize Incoming Investments
(Grants etc) and IFA Investment
• Manage Disbursement of Funds to
Farmers, Projects, Community
Services or other initiatives based
on the direction and approval of
the IFA Executive Board
• Budgeting & Forecasting Activities
• Periodic Financial Reporting
43
44. FINANCIAL SERVICES – SUPPORTING
PROCESSES
Risk Management & Financial Controls
• Organization Structure provides for clear • Undertaking Stringent Credit Checks
segregation of duties to mitigate risks of (Financial Needs, Family Members, Size
Needs Members
fraudulent activities of Land, Monthly Income etc.)
• Establishment of a Delegation of • Short Term Repayment of Loans and
Authorities Framework Credit Profiling
• Supervisory Board and External Auditors
p y • Monitoring Controls over Loan
g
provide “check and balance” repayments
44
47. IFA Governance & Communications
Structure
General Assembly
Key:
Key: Headcount
H d t
[] – 1‐2 yr timeline
–
81 Governance &
[] – 5 yrs timeline Supervisory Executive Decision Making
Board Board
3 3 9 9
Audit
A dit
External Executive
Auditors Director Implementation
Village 1 Village 2
… Village 6 Village X
6 37
Activity
Product Activity
Product Activity
Product Activity
Product
Group 1
Group 1 Group 2
Group 2 Group 3
Group33 Group 4
Group 4
Group 1
G Group 2
G 2 Group 3
G Group 4
G
. Activity Based Groups …
Same structure per
village
48. IFA Group Communication Model
p
IFA
Activity
y Village Groups
Based - Not all are IFA members
Groups - Not all belong to an
- All are IFA Activity Based Group
members
- Led b a village h d
L d by ill head
- Bonded together
by common goals
- Led by a group
head
48
49. Activity-Based Group (ABG)
y p( )
Who:
EB IFA Self-governance g
g grassroots entity formed by farmers
y y
who share the same agriculture product/activity and
volunteer to lead in the ABG
What:
ABG Facilitating two-way communication between IFA and
farmers, between EB and farmers
How:
-Financial and community services are delivered to
FARMERS farmers through ABG and EB’s decisions are acted
upon through ABG.
Key: -Farmers opinions and concerns are pushed up to IFA
Farmers’
or EB by ABG.
Decision flow
Opinion /product flow
Service flow Why:
smaller group size + shared interests = stronger bond
among farmers
50. Roles and Responsibility in IFA
p y
General Assembly Supervisory Board
- Elected by village representatives - 1 farmer and 2 independent directors
- Elect board of directors - Ensure decisions are executed and capital
- Review and approve annual budget allocated as planned
- Vote on direction and major p j
j projects of IFA
Executive Board
E ti B d Executive Director
E ti Di t
- 9 farmers elected by the General - Evaluated by Government, CCFA
Assembly (GA) and one nominated EB member on an
- Not more than half can hold village level annual b i
l basis
administrative role - Government secondee/ Non-IFA member
- Call general assembly - Leads all IFA projects and initiatives
- Reviews the annual budget - Review and develop annual plan
52. IFAH Management Team Structure
g
Staff
Key: Headcount
d
[] – 1‐2 yr timeline
EXECUTIVE
[] – 5 yrs timeline DIRECTOR
Human Community Public
Finance & Production /
Resources &
Resources & Credit Outreach &
Outreach &
Investment Supply Chain
S l Ch i Affairs
Admin 1 2 1
6
2
7 Environment 4
1 4
7 1
2
Critical to the success of implementation for the
5-year plan, effective utilization of human
resources needs to be made.
esou ces eeds ade
52
53. Decision Flow
Executive
KEY AREA/RESPONSIBILITY CENTER GA EB
Director
• Project launch - Approve Review
• Annual Budget Approve Review Implement
• Capital/Asset allocation - Approve Review
• Partnership agreement (with
Approve Review Implement
Cooperatives etc)
• Dividend payout Approve Review Implement
• Social/community investment - Approve Review
• Lending rate - Approve Review
• IFA Borrowing - Approve Review
• Designed to ensure clear and transparent decision making
• Ensure Farmers’ welfare is considered in all decisions (General Assembly as the main voice of farmers)
• Provides measures to mitigate risk and fraud
Increased executive board empowerment
54. Authority Flow
y
KEY AREA / RESPONSIBILITY CENTER GA EB ED
Investment/procurement *
> 50,000 (amounts above) √
21,000 - 50,000 (amounts in range)
√
< 20,000 (amounts below)
√
Loan Amount
> 40,000 √
> 20,000
√
> 10,000 (* NB R
10 000 NB: Range t th start of superior’s)
to the t t f i ’ )
√
Audit report √
IFA staff recruitment and layoff √
ED recruitment and layoff √
• NB: (*) Amounts will increase on an upward adjustable scale and approved by the general assembly with
the growth and expansion of IFA
• Highlights key decision makers’ level of authority in specific key areas usually prone to fraud & lack of
transparency
IFA to take equity stake in
the coorperatives
55. Process Scenario
Decision Making & Approval
For a typical
procurement or
investment decision to be
made, a scenario-based
approach is presented to
exemplify decision and
authority flow.
Aim:
-To ensure implementation
of best management
practice
-Keep approval conditions
K l diti
set and properly
documented
-Remain mindful of time
required for processing and
release of funds
NB: (*) Amounts subject to
increase as organization
g
grows.
FOR REFLECTION: THE ORGANIC FERTILIZER PLANT CASE
56. IFA Integration/Partnership with
Professional Cooperatives
• Common assumptions
– Smallholder farmers can see and benefit from the integration/partnership of IFA
and cooperatives
– Both IFA & the cooperatives see value in integration/partnership
– Main driver for partnership/integration is financial
• What
Wh t IFA brings to the table
bi t th t bl
– Access to investment and lending funds
– Strong government relationships and support
– Robust governance and management structure
– Provide economies of scale in production capability (by enabling consolidation of
small holder assets) and access to potentially larger markets
• How IFA can benefit from the Cooperatives
– Transfer of technology and know how
– Access to current established distribution channels
– Access to established brand/marketing
– Provide
Pro ide economic benefits for small holder & revenue stream for IFA
re en e
57. IFA Integration with Professional
Cooperative as a Shareholder
Potential General
Beginning
Gate Stage
Executive Director investment/partnership Assembly
sse b y
recognizes potential opportunity presented to to decide No
partnership opportunity Executive Board & General whether to
Assembly participate
Yes
IFA mobilizes smallholder IFA appoints a representative IFA injects capital
farmers & enables to the cooperative investment into cooperative
communication between board/management team, & becomes a shareholder in
parties approved by Executive Board the cooperative
Farmer benefits by
F b fit b
selling produce
back to cooperative
Cooperative shares
Results
technology/know-how to
appropriate smallholder
farmers IFA benefits in profit
sharing
58. Rural Investment by Government:
recommended improvement
Government Project Funding
Proposed funding route for new Current funding route for
community related projects: Central Government social security p j
y projects:
contract based outsourcing of government Distribution of project funding
projects to IFA through township government and
Provincial Government village committee
Key areas:
-Environmental management, including Key areas:
y
waste collection, land regeneration
t ll ti l d ti - Health care
- supplies shop Prefecture Government - Social security
- Elderly care - Pension
- Rural community integrated service center - Infrastructure development
- Health education County Government - Education
- Women organisation
- Cultural activities
IFA Township Government
Key benefits:
-Improved efficiency
-Community ownership Village Committee
-Self-governance :
payment by farmers to
cover part of the cost
p Farmers
-Reduced corruption
58
60. Production and Marketing Strategy
• Heshuiping is a unique place due to the
diverse products it can p
p produce Pigs Rice Vegetables Rapeseed
• In consideration of building community Kiwi Fruit Green Tea Chestnuts Konjac
confidence and building up IFAH’s
management experience, the five year Mandarin
Potato Tobacco
plan will initially focus on providing support Oranges
and strengthening the capabilities of
farmers going (or already) into breeding
pigs and farming rice
Develop successful
• As IFAH’s operational capacities are
p p examples of farmers
strengthened and it gains know-how, the
organization can refine the model in order and breeders in high
to focus on other products margin products
60
61. Key Focus
Improve farmer’s livelihood and IFAH’s profitability through:
p p y g
• Investment in Fragrant Rice production and production volume
Supply Chain
increase
Improvement • Set up of pig farming supply chain collection and sales network
Branding Develop IFA brand as quality agricultural produce
• Develop Township level branding for Sanli agri produce
Development
• Branding transition and inclusion of key commercial produce under
and single umbrella
Marketing
Effective supply chain and brand awareness to provide
new revenue stream for IFAH and farmers
62. Fragrant Rice: The Potential
• Current fragrant rice production is constrained by lack of
p ocess g and a e ous g ac ty
processing a d warehousing facility
• Limited funding and investment impeding further expansion of
Professional Fragrant Rice Cooperative
• Untapped potential of smallholder farmers (3570mu
uncultivated land and 1500mu regenerated riverbank area)*
• Positive market condition and return (RMB480/mu for normal
fragrant rice, and up to 5-8 times for organic fragrant rice)
Fragrant Rice – A key starting point
for IFAH demonstration
* Suitability of rice growing subject to detailed land utilisation study
63. Fragrant Rice: Enablement of Supply Chain
• Capital investment of RMB 900K for processing and storage
investment
– Funding: Profession Rice Coop RMB300K + IFAH RMB600K
g p
• Smallholder farmers to venture into fragrant rice growing
• Seeding, agriculture technical services assistance, and sales
and distribution thro gh Professional Cooperati e
distrib tion through Cooperative
• Expected return:
– Breakeven by Year 4
– Profit of RMB 912,000 over 5 years
63
64. Pig Farming: The Supply Chain
IFAH owns a pig breeding farm. Formation of a
supply chain would help the smallholder farmers to Pig Breeding Farm
strengthen their capacity in pig farming:
• To provide quality piglets for farmers to raise Pig Farmers
• To provide the logistic services to collect the
Collection and
pigs from the farmers and sell to the market Distribution
• Can afford to buy the pigs from the farmer at
a higher price because it is able to get better Market
pricing from consolidating the volume
• This will help to increase the revenue of
p
smallholder farmers
Improved revenue of IFAH and smallholder farmers
through the scale of economy
th h th l f
64
65. Pig Farming: The Untapped Market
• IFA to provide the new breed of pigs:
– Improve the pig’s quality to increase the lean meat and reduce fat
pig s
– To provide branding and awareness to the consumers on the
benefits of the new pig
• Brand the New Breed Pig as Lean from Year 2:
– Able to price the pig 10% above market rate
• Brand the Pig as Traditionally-grown from Year 5:
– Able to price the pig 30% above market rate
– Requires quality checks to ensure that
the pigs are grown traditionally
• Expected return:
– Profit from Year 2
– Profit of RMB 4m over 5 years
65
66. Branding Strategy for IFAS Products
• Rebranding IFA to Township level
inline with expansion plan
• Change the name from IFAH
Option 1
(Heshuiping) to IFAS (Sanli
Township)
• Year 1 and 2: transition period
– Relying on the existing well known brand,
like 三里香 rice, to promote IFAS. IFAS
just appear as an endorsement
– Building a new brand for the Pig farming Option 2
business
– Introducing IFAS and their products to
Government, market and famers through
different channels
– Building name awareness gradually
Remark: Logo just for reference only.
66
67. Branding Strategy for IFAS Products
• Year 3 – 4: Brand build-up period
– Building strong awareness for IFAS
– Logo will be used on all products,
Supply stores and other area
– Build IFAS website to promote IFA
and all productions
– Beginning to establish an affinity and IFA Logo
loyalty to IFAS brand and the
products under its umbrella amongst
those customers
• Year 5 and onwards
– Brand maintenance
IFA + Rice Logo
67
68. Sales & Marketing: Target Markets
• IFAH Stores (supply stores and grocery stores)
• Local (supermarkets hotel / restaurant deeply process factory and
(supermarkets, restaurant, factory,
direct delivery to consumers)
• National markets (supermarket / organic food chain outlets in
Wuhan/Shanghai and other cities via strategic partners such as
partners,
Carrefour & Wal-Mart)
68
69. Prioritization of Projects and Allocation
of Resources: Long Term Success
• Focus on immediate value and b i
F i di t l d business necessities.
iti
• Keep the implementation simple, focused on value, and structured
with a plan
• Review the existing initiatives
• Governance structure must be in place to review the project viability
and business case prior to each investment.
IFAH needs to show results now and any project that could be taking
away resources and focus from the organization in delivering value,
should either be put on hold or terminated
69
70. The Production of Organic Fertiliser as a Revenue
Source for IFAH: Further Review Required
q
• IFAH is in the process of setting up a pilot organic fertiliser production
facility that converts local organic agriculture waste into organic
fertiliser through a fermentation process
• Full-lead Bio Tech in Taiwan is the project partner providing the
technology, however they do not have prior experience in China and
have not obtained organic fertiliser certification in China
• The technology and design of the production facility needs to be
reviewed in accordance with the organic fertiliser certification
standard in China to meet all the quality, health and safety
requirements. At present, the setup and management of the pilot
production facility have not addressed all the requirements. Upon
initial assessment, the plant does not appear to be appropriate for the
villages.
g
70
71. The Production of Organic Fertiliser as a Revenue
Source for IFAH: Market Development in the Future
p
• The organic fertiliser produced by the current technology needs to be
sold as a high-end organic fertiliser at RMB 1500-2000 per tonne to
high end 1500 2000
justify its cost of production with high-energy demand
• The target market for high-end for organic fertilisers are organic fruits
and vegetables producers
• However, the development of a high-end market in Heshuiping region
is still in its infancy. Sales channel needs to be developed to market
the fertiliser to other places in the county where the fruits and
vegetable industry are more mature, but this is not practical or a
priority at this stage
• IFAH can p ay a role in de e op g t e local fruits a d vegetables
ca play o e developing the oca u ts and egetab es
industry through organising production and marketing groups and
providing the needed technical assistance and practical know-how in
organic farming and supporting farmers to obtain government
subsidies for using organic fertiliser.
71
72. The Production of Organic Fertiliser as a
Revenue Source for IFAH: Next Steps
• The project needs professional consultation, and IFAH needs to
consider alternatives including seeking other technology providers in
alternatives,
China, and consider other more affordable technologies such as
biogas reactor and composting. Field testing needs to be done with
professional design and implementation, funded by the technology
provider, with third party certification
• Key questions to be answered:
- Wh t type of organic waste can be used as raw material?
What t f i t b d t i l?
- Are dead animals permitted?
- What is the energy needs?
- What are the emissions?
- Is the fertilizer in solid, liquid or semi-liquid state?
72
74. Community Services:
Aim
• Increase yield of production & average household income
• Fill crucial knowledge gap on product pricing technology
pricing, technology,
machinery, financial management and business opportunities
• Attract migrant workers back to and retain youth in the villages
• Improve healthcare awareness and health status
• Initiate cultural activities to help engage villagers and improve
livelihood
• Enhance environmental awareness and overall living conditions in
the villages
• Support innovation in agriculture production and natural farming
Create better living conditions through economic and
environmental enhancement
74
75. Community Services:
Actions
• Training on agricultural know-how in each village at least twice a year
• Training for young generation: highlight the value and opportunity of
livelihood in farming, and learning Chinese and English terms at the
same time
• Cultural extension: identify 4-5 volunteers from each village as well as
Action-based groups to coordinate activities
• Free healthcare sessions and home visits for members
• Waste management initiative: to collect garbage and clean the river
75
76. Community Services:
Resources Needed
• 1 coordinator for agriculture extension and administration
– Budgeted for in overall IFAH structure
• Budget for agricultural training by specialists/consultants:
– Allocation of 20% of IFAH revenue for community services, membership
fees and potentially training grants from banks
• Logistics for rubbish collection (e.g. vehicle maintenance & delivery)
– Suggest government to provide funding as part of public service delivery
• Nominal amount as incentive for cultural activity volunteers
– ~RMB 2500 per year
• Budget for healthcare, waste collection and miscellaneous training
(e.g.
(e g healthy aging farm health tips cooking a healthier meal etc ):
aging, tips, meal, etc.):
– Government funding support to be discussed
Details available in appendix
76
78. Implementation Plan
Setup of credit
p
mutual assistance Commence deposit taking & mature to final financing model
scheme
Strengthen
Governance and
General
Organization Assembly
Pig Farming Supply Chain
Fragrant Rice Production Expansion
Preparation for Launch of Community
Community Services continued and Community Services continued and enhanced
Services launch enhanced
Gradually extend to the whole Sanli Township
Year 1
Y 2 3 4 5 6
79. Five-Year Implementation Timeline
Year 1: 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter
(Month 1-3) (Month 4-6) (Month 7-9) (Months 10-
12)
• Establish Finance Awareness & Education Program • Rollout Finance Awareness & Education
• Prepare for agricultural training sessions in the 6 villages Program
• Liaise with primary schools to set out training for young generation • Communicate and promote training plans to
• Setup of waste collection stations members
• Source for seed capital • Establish financial, credit and • Launch training sessions • Recruit
control policies and procedures on agricultural extension additional IFAH
• Setup governance and functional staffs
organization structure • Fill immediate vacancies for • Submit application for
Finance, HR & Credit license to accept farmers’ • Finalize
• Executive Board to review new departments
d t t deposits production and
governance, board & management marketing
structure • Train new IFAH staff • Launch PR project for investment
membership cultivation & decision
• Establish mutual assistance scheme • Set up facility for Fragrant Rice new IFAH model
for farmers with matching funds from
government • Plan for communications on • Set up activity-based
the new IFAH model groups
• Apply for training grant
• Source independent supervisor • Seek approval of new
• Collect data on demographics and
crop production structure & IFAH business
• Initiate implementation of model by GA
waste management
• Appoint cultural extension volunteers
79
80. Five-Year Implementation Timeline
Year 2 Year 3 Year 4 Year 5
Obtain license for and implement savings Extend fragrant rice Conduct training & Review results
scheme production create promotion
materials for other Conduct annual audit
Establish and implement savings Start cross-bred pig townships of IFA business
scheme policies & procedures and farming & distribution
operations Conduct annual Extend IFA to other
Conduct annual audit of audit of IFA villages in the Sanli
Ramp down Capital Mutual Assistance IFA business business township
Scheme
Introduce waste Extend IFA for Seek new sources of
Launch of agricultural and healthcare
g management p g
g program for another 10 villages
g funding
g
training sessions in 6 villages other villages
Evaluate other Implement e-farmer
Launch of cultural extension initiatives Review the progress of IFA crops for IFA kiosk in agricultural
coverage supplies store
• Purchase of waste collection trucks Extend IFA for another 10
villages Seek new sources
Launch of waste collection services of funds
Expand agricultural and
Conduct annual audit of IFAH business healthcare training
sessions to more villages
Recruit additional IFAH management (to
support expansion) Elect IFAH executive &
supervisory board
Integrate professional cooperatives
80
Seek new sources of funds
82. HIGH Risk
Risk Assessment Matrix MEDIUM Risk
LOW Risk
1 Lack of Alignment of Goals of
7 10 11 1 6 8 3 Executive Board Members
2
High
Non Transparent
Non-Transparent IFA Administration
3 IFA Inability to Attract & Retain Talent
4 Poor Quality of Training
act
5 9 2 4 Inability to Attract Farmers to
um
5
Impa
Mediu
Community Programmes
Poor Financial Controls and Risk
Management Practices
7
Capital Reduction Due to High Rate
of Loan Defaults
8 Inability to Secure Funding
Low
9
Poor Quality Agricultural Raw
Materials
10 Pig Livestock Depletion
Low Medium High
11
Fragrant Rice Crop Failure
Likelihood
The Risk Assessment will enable IFA in prioritising activities as part of the
implementation of the 5 Year Plan in order to effectively and efficiently mitigate risks,
in a timely manner, which could threaten the viability and sustainability of the social
business venture
82
84. Key Recommendations
FINANCE PRODUCTION AND MARKETING
1) Review supply chain for pig farming, and develop
1) Introduce the Finance & Investment and Credit
Investment, business i pig collection and di t ib ti t i
b i in i ll ti d distribution to increase
Functions as IFAH’s sole vehicle for provision of revenue for farmers and IFAH
financial services
2) Review crop/land allocation and expand fragrant rice
2) Establish Savings Scheme and utilize money production
remitted by migrant workers to enhance IFAH’s
capital base 3) Seek professional consultation for Organic fertilizer
project,
project and alternatives including seeking other
alternatives,
3) Provide outreach programmes to promote IFAH’s technology providers needs to be considered
financial services and assist farmers to safeguard
their financial security 4) Review the business model of agriculture supplies
store to ensure long-term business sustainability
COMMUNITY SERVICES GOVERNANCE
1) Review IFAH team composition; enhance
1) Set up mechanism to train farmers on more management bandwidth, governance, risk
effective farming, with a view to enhancing the management and transparency
overall average household income
2) Review member leadership structure, from
structure
2) Enhance healthcare awareness and cultural & geography based leadership to functional/crop based
educational activities. groups
3) Provide framework for creating positive 3) Enhance internal checks to ensure benefits to
environmental impact, e.g; waste collection, farmers
organic fertiliser.
84
85. Key Success Factor – Government
Support
• Government may consider working with IFA as its strategic
outsourcing p
g partner to execute g
government-funded policies/projects
p p j
because IFA is owned by farmers and acts on behalf of farmers.
• Government outsourcing is on the rise. IFA may consider
establishing a company (eg. JV) to undertake some government
projects.
• The Central Government just issued the policy of supporting
agriculture professional cooperatives last year IFA may consider
year.
how to leverage government support in this area.
• Responsibilities of township and county pilot program office must be
clearly d fi d T
l l defined. Township office works closely with IFA t address
hi ffi k l l ith to dd
IFA’s concerns. Meanwhile county office focuses on seeking more
government funding and projects for IFA and refrains from direct
involvement in township IFA operation unless requested.
86. APPENDIX
A. IFAH Stakeholder Chart
B.
B Key Assumptions
C. Governance
D. Finance
E. Production & Marketing
F. Community Services
G. Risk assessment and Mitigation
g
86
88. Key:
Stakeholder Map Current
New
N
Advisory & Governance Finance
1) Board/General Assembly
B d/G lA bl
1) Credit Cooperatives
2) Pilot Programme Office (County)
2) Local Banks/Credit Union
3) Consulting Centre for Farmers’
Association 3) Private Investors
)
4) Local Banks/ Credit Union
5) Bureau of Agriculture
6) Ministry of Education IFAH
Partners
1) Smallholder Farmers
2) Rice Cooperatives 6) Other Cooperatives
3) Member Group Head/Village Head 7) Other IFA
4) Mutual Assistance Cooperatives 8) Media
5) Employees
88
90. Key Assumptions
• The scale to achieved within the 5 Year Timeframe is Sanli
Township (37 Villages)
• The 5 Year Plan will become an integral component of the Sanli
Township 5 Year Plan
• 1 IFA for 1 Township Model will be adopted
• Group Heads will be empowered with some administrative and
advocacy/awareness activities
• Resource support will be provided by the various partnering
Financial Organisations in the form of secondments and awareness
& education
• Farmers will be willing to pay for specialist training for re skilling
re-skilling
and skills enhancement
• Healthcare and Insurance Programmes will be funded solely
through IFA Profits
90
91. Key Assumptions… Cont’d
Assumptions over 5 year timeframe Measurements
Land Measurement 0.093 Hectares is equivalent to 1mu
q
Average Inflation Rate 4.25%
Average Salary Increment 6%
Average Personal Taxation Rate 5-10%
Average % of Asset Costs allocated for Maintenance Costs 5-15%
Capital Mutual Assistance Loan Interest Rate 7-10%
Deposit Interest Rate 0.5%
0 5%
Loan Default Rate Per Year 1.5% of disbursements
Average Increase in Household Income 17%
Approximate Fee for Skills Enhancement Classes Per Year RMB100
Cost Per Household Per Year for Waste Collection RMB 60
IFA Profit Allocation for Healthcare & Insurance Programme 4% (2% each)
Average Agricultural Taxation Rate 0%
91
93. General Assembly*
y
• Elected by village representatives
• 2/3 of the members should be farmers
• Term: 4 years
• Members are not allowed to be hired/recruited by IFA
• Responsibilities
– having the ultimate authority
– making and changing IFAH chapter
– electing & dismissing executive board members
– reviewing business report and financial report
– defining and changing membership fees and capital allocated for
social services
– reviewing & approving the annual budget
• Held once every year ad hoc meetings can be initiated by 1/3 of
year,
representatives or by Executive Board
*Unpaid positions
Unpaid
93
94. Executive Board*
• Number: 9 farmers
• Term: 4 years and two terms is the max max.
• Requirement:
• -All agri-products and villages must be represented.
• Responsibilities:
– calling general assembly and acting upon GA’s decision
– electing and dismissing Chair
– approving & reviewing performance of Executive Director
– reporting to the General Assembly on IFA
– hiring external auditors to do annual IFA auditing
– reviewing the annual budget
– setting the strategic direction for IFAH (social & economic growth)
– making i
ki investment decisions,
t td i i
– making loan decision on loan amount above 40k RMB
• EB members must meet at least every quarter.
*Unpaid positions
Unpaid
94
95. Supervisory Board*
• Number: 1 farmer & 2 independent directors
• Term: 4 years and two terms is the max.
• Requirement:
• - at least one independent director is a businessman with no conflict of
interest. The other one can be a NGO representative ( g CCFA )
p (eg. ).
• Responsibilities:
– making sure all decisions are executed and capital allocated as
planned.
– SB must hire external accountant to do auditing hiring external
auditing,
auditors to do annual IFA auditing
– act as check and balance for all EB activities and decisions
• SB members must meet at twice a year.
*Unpaid positions
Unpaid
95
96. Group Head*
• Profile: farmer with crop-specific technologies and in-group trust and
p p g g p
respect
• Responsibilities:
– training group members in agricultural extension
– representing the i t
ti th interests of group members
t f b
– advocating finance and credit awareness (with a key focus on the
saving scheme)
– undertaking basic finance and credit administration tasks
– coordinating social services delivery on behalf of IFA
– passing on key decisions of GA/EB to group members
*Unpaid positions
Unpaid
96
97. Executive Director
• Requirements:
– full time paid p
p position
– either recruited openly or a government secondee (paid for by the
government)
– non-IFA member
• Term: 4 years & maximum of t
T i f two terms
t
• Responsibilities:
– acting upon EB decisions
– leading IFA work
– developing annual plan
– recruiting, laying off and training IFA staff
– performance evaluation of IFA staff
p
– held accountable to EB
• Performance Management:
– Evaluated by Government, CCFA & one nominated Executive Board
memberb
97
98. Compensation Guidelines
• Current average monthly per capita income in the area is RMB1500
• Migrant workers have mentioned that they will consider staying if they can
earn at least RMB1500 monthly in their village/home town
• Recommended salary guidelines as follows
Basic Monthly
B i M thl Variable B
V i bl Bonus~
Entry (eg 1500RMB 0.5-1 months*
accountant)
Mid level (eg 2000-2500RMB 1-1.5 months^
manager)
Senior (eg 3000RMB – 1-2 months#
Executive 4000RMB
Director)
~dependent upon IFA’s financial performance
*Based on individual performance
p
^Based on department performance
#Based on overall performance
98
99. Funding Sources of the County Government
Area Funding Project
Development and investment 40 million RMB • Community infrastructure
of rural China • Community service
Water utilities 20 million RMB • Potable water
• Water irrigation
Soil revitalization 5 million RMB • Riverbank regeneration
Livestock 3 million RMB • Pigs, sheep, cattle
Infrastructure 12 million RMB • Road
Food security 1 million RMB
Special industry 2 million RMB • Vegetable
5 million RMB • Fruit
99
101. Finance Services
• Excel reference 1: credit department model credit
department financial model_zl_222.xlsx
model zl 222 xlsx
• Excel sheet 2: combined financial model combined
financial model.xlsx
101
102. Finance and Credit Department -
Savings Scheme Awareness Plan
• Objective: to raise awareness amongst farmers and migrant
workers of the benefits of making deposits into IFAH
• Team: Village Heads and migrant workers will be the ones to
mobilize the Awareness Plan
– Village Heads have the connections within the villages i.e. they are on-the-ground
– Migrant workers have the money and will understand how other migrant workers
think to encourage them to make deposits
• Incentive: Team is motivated through a commission based
compensation plan t attain as much d
ti l to tt i h deposit as possible
it ibl
• Training: IFAH will train the team to promote the Savings Scheme
Awareness Plan
• Timeline: IFAH will cover 6 villages for the first 2 years and add 10
villages each year
* Larger resources are needed during Chinese New Year when all
migrant workers return to their home.
102
104. 1) Training -- Agricultural Extension
• Contents for knowledge enhancement:
– Better selection & use of fertilisers, pesticides, machinery/equipments,
p y q p
soil, water
– Improving quality of land, and current crops/animals by technology
– More productive land use and environmental management
– Raising other crop/animals, off-season planting
• Infrastructure required to
start, maintain, harvest &
sell t market
ll to k t
• Cost concern
– Product pricing, understanding of
market,
market & avenues to reach market
– Work safety (e.g. posture)
– Business & job opportunities
104