The objectives of the enterprise is to provide high yielding, disease-resistant, pure, viable, and quality coffee seed services to coffee growers, NGO’s and other private and governmental coffee-growing sectors. It will start as a private limited company with two stakeholders. The business starts its production with the amount of 10qt/ha certified coffee seeds. Annual production will begin a total of 20,000 kg (200qt) from 20 hectares after four years, which the business starts, and increase to 50,000kg (500qt) with a total area of 50 hectares after year six. The business will produce certified Arabica coffee seed to four agro-ecological production areas; which are Harar, Wollega (Nekemt), Limu and Sidama/Yirgacheffee coffee specialties. These coffee production regions have their own quality standards; to meet that standard and maximize the national market opportunity the business is paramount. The majority of the business will be sold in their own shop, but as production increases, the owners will utilize other distribution channels to reach the individual customers. The amount of money required to start up the business will be Birr 1,000,000. From this, 50% will be from the bank with 15 years loan period and 50% own saving. Out of the total initial investment birr 420,000 will be used for asset cost and 580,000 working cost. Generally, this capital will be used to construct the certified coffee seed store, to purchase tractors, coffee processing machines, generator office materials, and the necessary farm equipment, and to cover operating expenses. The enterprise requires 20 to 30 daily and contract workers when the business starts and increases more than 50 workers after five years of establishment. The profitability assumption is based on the total annual production of 500,000 Kg of coffee seeds. This is the volume of the product that will be supplied to the market after the projected permanently established. GGCACSE will be selling certified coffee seed at a basic minimum of birr 110 per kilogram - the maximum price will depend on the market. The average net profit margin over the projected three-year production period, based on the price of birr 110/kg is estimated at 29.3%. The break-even percentage is 3.34. At this point the business neither profit nor loss. The project is expected to provide an annual net profit in the fourth, fifth year 546,582 ETB and 769,096 ETB respectively. It will be increased to 1,912,153 ETB after six years of business establishment.
| Published in | International Journal of Economics, Finance and Management Sciences (Volume 9, Issue 1) |
| DOI | 10.11648/j.ijefm.20210901.12 |
| Page(s) | 7-15 |
| Creative Commons |
This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited. |
| Copyright |
Copyright © The Author(s), 2021. Published by Science Publishing Group |
Arabica Coffee, Business, Certified Seed, Enterprise
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| [2] | Babur D (2009). Effectiveness of farmer field school in promoting coffee management practices: the case of Jima and Sidama Zones. Msc. Thesis presented to school of graduate studies of Haramaya University. |
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| [4] | Bayetta B (2001). Arabica Coffee Breeding for Yield and Resistance to Coffee Berry Disease (colletotrichumkaahawaesp.nov). Ph. D dissertation, Imperial College at Wye, University of London, England |
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| [6] | Central Statistical Agency (CSA), 2016. The Federal Democratic Republic of Ethiopia Agricultural sample survey report on area and production of major crops, volume, I. statistical bulletin, 584. |
| [7] | Fernie LM (1966). Some Impressions of Coffee in Ethiopia. Kenya Coffee 31: 115-121. |
| [8] | Gole TW, Senebeta F (2008). Sustainable management and promotion of forest coffee in Bale, Ethiopia. Bale Eco-Region Sustainable Management Programme SOS Sahel/FARM-Africa, Addis Ababa. |
| [9] | International Coffee Organization (ICO) (2012). Ethiopian coffee production exceeds expectation. International coffee organization London. |
| [10] | International coffee organization (ICO) (2001). Positively coffee. International coffee organization, London. |
| [11] | Mesfin A (1988). Recommendation Adoption and impact of Improved Coffee Production Technologies in the Western Region of Ethiopia. pp. 136-141. In: 20th NCIC, 28-30 Mar 1988, Addis Ababa. |
| [12] | MOA (2019). Crop Variety Register Issue No. 22. Ministry of Agriculture Animal and Plant Health Regul. Directorate. 2019. Addis Ababa, Ethiopia. |
| [13] | Workafes W, Kassu K (2000). Coffee production system in Ethiopia. Pp 90-106. In: Proceedings of work-shop on control of coffee berry disease in Ethiopia. 13-15th. August 1999, Addis Ababa, Ethiopia. |
APA Style
Admikew Getaneh. (2021). Profitability Analysis Overview for Certified Arabica Coffee Seed Production to Seed Entrepreneurs in Ethiopia. International Journal of Economics, Finance and Management Sciences, 9(1), 7-15. https://doi.org/10.11648/j.ijefm.20210901.12
ACS Style
Admikew Getaneh. Profitability Analysis Overview for Certified Arabica Coffee Seed Production to Seed Entrepreneurs in Ethiopia. Int. J. Econ. Finance Manag. Sci. 2021, 9(1), 7-15. doi: 10.11648/j.ijefm.20210901.12
AMA Style
Admikew Getaneh. Profitability Analysis Overview for Certified Arabica Coffee Seed Production to Seed Entrepreneurs in Ethiopia. Int J Econ Finance Manag Sci. 2021;9(1):7-15. doi: 10.11648/j.ijefm.20210901.12
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Download@article{10.11648/j.ijefm.20210901.12,
author = {Admikew Getaneh},
title = {Profitability Analysis Overview for Certified Arabica Coffee Seed Production to Seed Entrepreneurs in Ethiopia},
journal = {International Journal of Economics, Finance and Management Sciences},
volume = {9},
number = {1},
pages = {7-15},
doi = {10.11648/j.ijefm.20210901.12},
url = {https://doi.org/10.11648/j.ijefm.20210901.12},
eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijefm.20210901.12},
abstract = {The objectives of the enterprise is to provide high yielding, disease-resistant, pure, viable, and quality coffee seed services to coffee growers, NGO’s and other private and governmental coffee-growing sectors. It will start as a private limited company with two stakeholders. The business starts its production with the amount of 10qt/ha certified coffee seeds. Annual production will begin a total of 20,000 kg (200qt) from 20 hectares after four years, which the business starts, and increase to 50,000kg (500qt) with a total area of 50 hectares after year six. The business will produce certified Arabica coffee seed to four agro-ecological production areas; which are Harar, Wollega (Nekemt), Limu and Sidama/Yirgacheffee coffee specialties. These coffee production regions have their own quality standards; to meet that standard and maximize the national market opportunity the business is paramount. The majority of the business will be sold in their own shop, but as production increases, the owners will utilize other distribution channels to reach the individual customers. The amount of money required to start up the business will be Birr 1,000,000. From this, 50% will be from the bank with 15 years loan period and 50% own saving. Out of the total initial investment birr 420,000 will be used for asset cost and 580,000 working cost. Generally, this capital will be used to construct the certified coffee seed store, to purchase tractors, coffee processing machines, generator office materials, and the necessary farm equipment, and to cover operating expenses. The enterprise requires 20 to 30 daily and contract workers when the business starts and increases more than 50 workers after five years of establishment. The profitability assumption is based on the total annual production of 500,000 Kg of coffee seeds. This is the volume of the product that will be supplied to the market after the projected permanently established. GGCACSE will be selling certified coffee seed at a basic minimum of birr 110 per kilogram - the maximum price will depend on the market. The average net profit margin over the projected three-year production period, based on the price of birr 110/kg is estimated at 29.3%. The break-even percentage is 3.34. At this point the business neither profit nor loss. The project is expected to provide an annual net profit in the fourth, fifth year 546,582 ETB and 769,096 ETB respectively. It will be increased to 1,912,153 ETB after six years of business establishment.},
year = {2021}
}
TY - JOUR T1 - Profitability Analysis Overview for Certified Arabica Coffee Seed Production to Seed Entrepreneurs in Ethiopia AU - Admikew Getaneh Y1 - 2021/02/09 PY - 2021 N1 - https://doi.org/10.11648/j.ijefm.20210901.12 DO - 10.11648/j.ijefm.20210901.12 T2 - International Journal of Economics, Finance and Management Sciences JF - International Journal of Economics, Finance and Management Sciences JO - International Journal of Economics, Finance and Management Sciences SP - 7 EP - 15 PB - Science Publishing Group SN - 2326-9561 UR - https://doi.org/10.11648/j.ijefm.20210901.12 AB - The objectives of the enterprise is to provide high yielding, disease-resistant, pure, viable, and quality coffee seed services to coffee growers, NGO’s and other private and governmental coffee-growing sectors. It will start as a private limited company with two stakeholders. The business starts its production with the amount of 10qt/ha certified coffee seeds. Annual production will begin a total of 20,000 kg (200qt) from 20 hectares after four years, which the business starts, and increase to 50,000kg (500qt) with a total area of 50 hectares after year six. The business will produce certified Arabica coffee seed to four agro-ecological production areas; which are Harar, Wollega (Nekemt), Limu and Sidama/Yirgacheffee coffee specialties. These coffee production regions have their own quality standards; to meet that standard and maximize the national market opportunity the business is paramount. The majority of the business will be sold in their own shop, but as production increases, the owners will utilize other distribution channels to reach the individual customers. The amount of money required to start up the business will be Birr 1,000,000. From this, 50% will be from the bank with 15 years loan period and 50% own saving. Out of the total initial investment birr 420,000 will be used for asset cost and 580,000 working cost. Generally, this capital will be used to construct the certified coffee seed store, to purchase tractors, coffee processing machines, generator office materials, and the necessary farm equipment, and to cover operating expenses. The enterprise requires 20 to 30 daily and contract workers when the business starts and increases more than 50 workers after five years of establishment. The profitability assumption is based on the total annual production of 500,000 Kg of coffee seeds. This is the volume of the product that will be supplied to the market after the projected permanently established. GGCACSE will be selling certified coffee seed at a basic minimum of birr 110 per kilogram - the maximum price will depend on the market. The average net profit margin over the projected three-year production period, based on the price of birr 110/kg is estimated at 29.3%. The break-even percentage is 3.34. At this point the business neither profit nor loss. The project is expected to provide an annual net profit in the fourth, fifth year 546,582 ETB and 769,096 ETB respectively. It will be increased to 1,912,153 ETB after six years of business establishment. VL - 9 IS - 1 ER -
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