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Urban Farm Business Plan ENG

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Matija Markovski
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52 views2 pages

Urban Farm Business Plan ENG

Uploaded by

Matija Markovski
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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This exercise is part of the RISE project programs for young social entrepreneurs.

RISE- Regional Incubator


for Social Entrepreneurs (www.risewb.org) is a project for the motivated, committed youth, willing to learn
and change things.

Urban Farm Business Plan

You have developed an Urban Farm just outside Belgrade.

You have already been developing the project for the last four months and have:

● Started the first piece of land with vegetables on a small scale;


● Identified distribution channels for your vegetables;
● Recruited one person as a urban farmer for this land plot;
● Invested in a farming machine.

Your next steps are to expand your production on a larger scale by renting 2 new different pieces of
land in order to reach breakeven. In order to organize this development and raise enough funds to
implement this development plan, you need to write your financial Business Plan.

In order to write this Business Plan, you will start with a P&L for the 3 coming years.

Please fill in the Excel Sheet with the following elements (all elements below are considered before
tax):

1. You currently pay a rent of 700€ for your actual piece of land
2. You plan to have an extra rent of 1500€ for the larger plot from July 2021
3. You have fix charges for electricity, water etc. of 150€ a month
4. You pay 30€ par trimester for website maintenance and further development
5. You pay an annual fee of 1200€ for insurance
6. You have recruited your first employed farmer at the end of last year for a gross salary
(employer charges included) of 800€ a month
7. You intend to pay your first salary from September 2021, with a minimum of 600€ monthly.
You will need to raise that salary to 700€ as of March 2022, and then 800€ as of January 2023
8. You will recruit a second farmer as of July 2021 for a monthly salary (employer charges
included) of 1000€ for each farmer.
9. You intend to recruit a part-time shop manager as of January 2022 for a monthly salary of
650€ (employer charges included).
10. You will ask for the expertise of Farming experts for the installation of the new land plots in
2021. You have already received their quote for a total amount of 6000€.
11. You expect to implement an impact evaluation in 2023. If you want to externalize it, it can
cost you up to 5400€.
12. The law in your country imposed 2 different operational taxes:
a. A training tax, which corresponds to 1% of the total salary cost
b. A rent tax, for an annual amount of 540€
13. Your bank charges you with a monthly fee of 10€
14. You have an external accountant who charges a monthly fee of 150€ for accounting and
payroll.
15. You have bought a farming machine for 6000€ in January 2020. It is amortized in 5 years, so
1200€ a year.
16. You had contracted a loan for the purchase of this machine. Each month, you pay 90€ to the
bank, divided as such :
● 83€ of capital reimbursement
This exercise is part of the RISE project programs for young social entrepreneurs. RISE- Regional Incubator
for Social Entrepreneurs (www.risewb.org) is a project for the motivated, committed youth, willing to learn
and change things.
● 7€ of interests payment
17. The Corporate Taxes in your country are of 15% of you EBT.
18. On your first piece of land, you grow carrots and beetroots mostly. You have planted
potatoes last year and should have your first crops in May 2021. You sell carrots at 2€ a kilo,
beetroots at 3€ a kilo, and potatoes at 1,5€. You intend to sell 350kg of carrots a month and
400kg of beetroots a month. As of May 2021, you plan to sell 500kg of potatoes a month.
19. From your new pieces of land that you will have in July 2021, you won’t be able to sell any
vegetables before March 2022 because you need to wait for the crops to grow. In 2022, you
intend to sell:
● 700kg more of carrots from March
● 800kg more of potatoes from September
● 800kg of cabbages from October. You sell cabbages at 2,5€ a kilo.
● 550kg more of beetroots from June.

Once you have filled the P&L, please analyze it answering the following questions:

● What is your target turnover after the development of your urban farm?
● When does your EBITDA turn positive (annually & monthly)? How do you explain it?
● When does your Net Income turn positive (annually & monthly)? How do you explain it?
● Analyze the results in 2021; 2022 and 2023.

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