British Columbia Food Processors Association Planning Tools Project

1
British Columbia Food Processors
AssociationPlanning Tools Project

• Guidance for developers of provincially licensed
  abattoirs
• Developer Categories
• Existing unlicensed operations
• Licensed operations in need of upgrades
• New operations

2
Planning Tools Content

• Self Assessment
• Development Guide
• Sample Business Plan Templates
• Information Distribution

3
Current Status

• As of Sept. 15, 2005, the project material has
  been completed and submitted to the BCFPA for
  printing and posting on the website.
• Printed copies available at this meeting for
  10.00.
• CDs available at this meeting for 5.00.
• Copies available for free download at
  www.bcfpa.ca/mies_resources.html.

4
Conditions of Documentation

• The British Columbia Food Processors Association
  (BCFPA) is pleased to offer the Planning Tools
  Resource Guide for those wishing to develop or
  upgrade to provincially licensed slaughter
  plants. The materials contained in this guide
  represent the most current information available
  as of September 15, 2005.
• However, changes with respect to key issues (e.g.
  waste disposal) are ongoing, and updates will be
  made as required. Any updates will be
  communicated to registered holders of the guides
  and will be posted on the BCFPA website
  (www.bcfpa.ca).

5
Conditions of Documentation

• There are two guides one for red meat and one
  for poultry. Some sections in both versions deal
  with both red meat and poultry issues. The
  guides were prepared with ongoing input from
  industry and government. We welcome comments and
  suggestions and will update as required.
• Please contact
• Julie Labelle
• Ph [phone]
• Fx [phone]
• julie.labelle_at_bcfpa.ca

6
Version I Red Meat

• Table of Contents
• Section Title
• 1.0 Introduction
• 2.0 Glossary
• 3.0 Self-Assessment Guide
• 3.1 Pre-Development Decision
• Chart A New Projects
• Chart B Upgrades
• 3.2 Assessment of Market Potential of Red Meat
• 3.3 Sizing Guidelines
• 3.4 Waste Disposal Considerations
• 3.5 Breakeven Analysis

7
Version I Red Meat (continued)

• Table of Contents
• Section Title
• 4.0 Development Guide
• 4.1 Activities List for Development of an
  Upgraded or New Abattoir
• 4.2 Critical Path and Probable Timelines
• 4.3 Contact List and Reference Guide
• 5.0 Business Templates
• 5.1 Mobile Red Meat Abattoir
• 5.2 Stationary Red Meat Abattoir

8
Version II Poultry

• Table of Contents
• Section Title
• 1.0 Introduction
• 2.0 Glossary
• 3.0 Self Assessment Guide
• 3.1 Pre-Development Decision
• Chart A New Projects
• Chart B - Upgrades
• 3.2 Assessment of Market Potential of Poultry
• 3.3 Sizing Guidelines
• 3.4 Waste Disposal Considerations
• 3.5 Breakeven Analysis

9
Version II Poultry (continued)

• Table of Contents
• Section Title
• 4.0 Development Guide
• 4.1 Activities List for Development of an
  Upgraded or New Abattoir
• 4.2 Critical Path and Probable Timelines
• 4.3 Contact List and Reference Guide
• 5.0 Business Templates
• 5.1 Mobile Poultry Abattoir
• 5.2 Stationary Poultry Abattoir

10
Decision Chart A New Projects

• At this stage, you would be identifying the
  business concept full service, slaughter only,
  fixed or stationary, species focus, etc.
• Using the market assessment guide, develop a
  preliminary estimate of potential sales.

Conceptualization
Market Analysis
11
Decision Chart A New Projects (continued)

• Based on the sales projections, develop a plant
  model size and preliminary total cost.
• Based on the AU volumes, complete the waste
  assessment worksheet.
• Recalculate the total costs to include waste
  disposal capital costs.

Plant Sizing and Development Costs
Waste Assessment Worksheet
Revised Total Costs
12
Decision Chart A New Projects (continued)

• Given the revised total costs, identify a
  probable financing scenario including
• debt
• equity
• government support
• etc.
• Use the breakeven worksheet to calculate the
  volume requirements to breakdown.

Financial Scenario
Revised Total Costs
13
Decision Chart A New Projects (continued)

• If a significant portion of the forecasted sales
  must be achieved to breakeven, the venture may
  not be feasible.

Compare Sales Forecast To Breakeven Volumes
14
Decision Chart A New Projects (continued)
Options
Abandon the project
Look at revising the business concept and redo
the analysis
Change the financial structure to reduce fixed
costs, i.e. more equity. This would lower
breakeven volume requirements.
Proceed to detailed business plan
Notes A realistic self assessment is critical.
Analysts from financing sources will be doing
similar due diligence on the project. If it does
not make economic sense, financing will be
difficult to obtain.
15

• The Decision Chart uses the worksheets to help
  the proponent decide whether or not (or how) to
  proceed.
• market analysis
• plant sizing and costs
• waste assessment
• break-even analysis
• It is a mini feasibility study.

16
Financial Models for Abattoir Projects

• Additional Material Financial Models
• In all cases, users should adjust all costing and
  revenue projections to their own situation.
• Electronic spreadsheets are available on BCFPA
  website.

17
Financial Models for Abattoir Projects

• 5,000 AU Mixed Species (pork and beef)
• Custom and Owned Meat Sales
• 10,000 AU Mixed Species
• Custom and Owned Meat Sales
• Generic Meat Model Template
• Mobile Red Meat
• Generic Meat Model Template
• Stationary Red Meat
• Generic Meat Mobile Template
• Mobile Poultry
• Generic Meat Model Template
• Stationary Poultry

18
Sample Business Plans

• 2 Red Meat and 2 Poultry
• Smallest is for 10,000-15,000 chickens operated
  as a service to farmers
• Largest is for a 3,000 AU red meat abattoir

19
Sample Red Meat Stationary Table of Contents

• 1.0 Introduction
• 2.0 Background
• 2.1 History
• 2.2 Operational Strategy
• 2.3 Facility and Infrastructure

20
Sample Red Meat Stationary Table of Contents

• 3.0 Business Concept
• 4.0 Supply of Red Meat Animals

21
Sample Red Meat Stationary Table of Contents

• 5.0 Market Analysis
• 5.1 Competitive Situation
• 5.2 Market Research
• 5.3 Potential for Wholesale
• 5.3.1 Approach
• 5.3.2 Market Size
• 5.3.3 Meat Consumption
• 5.3.4 Market Characteristics and Trends
• 5.3.5 Meat Industry Developments
• 5.4 Projected Sales

22
Sample Red Meat Stationary Table of Contents

• 6.0 Plant Requirements
• 6.1 Background
• 6.2 Cost Estimate (Preliminary)
• 6.3 Sources of Funds
• 7.0 Ownership and Management

23
Table of Contents

• 8.0 Financial Projections
• 9.0 Legal Issues
• 9.1 Zoning
• 9.2 Business License
• 9.3 CFIA Licensing
• 9.4 Incorporation

24
Next Steps

• We are looking at how we can provide direct
  support to those who are trying to develop their
  plans. Once we have something in place, we will
  post it on the website.