Mechanized poultry raising & processing: A project study

This is a feasibility study on the establishment of a four-hectare Mechanized Poultry Farm and Processing Plant in Muntinlupa, Rizal, to be organized as corporation to be known as Rizal Poultry Farms Incorporated. The proposed poultry raising and processing plant will fulfill 25-30% of the projected demand for dressed chicken in Greater Manila and Southern Tagalog for the decade 1975-1985. Initial production will be 4680-5616 dressed chicken/day for the first year of operation, 1975. This capacity has been established from an extremely conservative demand figure and of this figure, it has been decided to satisfy 25-30%. Whether capacity will be increased to follow the demand (11415-13699 chicken/day by 1985) will depend entirely on the public\u27s reaction to the product. Outlets for our dressed chicken products will be arranged by the sales department and for simplicity, will consist mostly of supermarkets, large hotels and restaurants. Pegging our wholesale price at P8.50/kilo for the first year will be competitive with the prevailing P9.00/kilo wholesale price of the Big-Five dressed chicken producers. It is calculated that the P0.50/kilo difference will be enough to draw customers to try Rizal Poultry Farms dressed chicken. The poultry farm will be composed of 14 234\u27 36\u27 chicken houses with automatic timer controlled feeders and manually-operated waterers. Daily output is 5541 chicken/work day, 6 days per week, which is 60% rated capacity. The Processing plant will dress the poultry farm\u27s output using a modern, sanitary and mechanized process. Rated at 8,000 birds/8hr day, the plant will operate at 69%capacity. Output will be from 5512-5541 dressed chicken per day, equivalent to 7150 to 7224 kilograms per day. About 80% of the equipment will be imported from the U.S.A. while the rest will be contracted to Neriscor, a local engineering firm. The total cost of investment is P9,051,746 of which P6,551,748 is fixed assets while P2,500,000 is working capital. The total investment will be financed as follows: 50% of the fixed assets will be obtained by a 10-year 14% loan from the PDCP, P3,275,874, and the rest, P5,775,874 by issuing stock. Ten-year revenue and cost projections were made using reasonable assumptions and the following rates of return were derived: average rate of return on sales .... 16.01% (a) average rate of return on average assets .... 41.56% (b) average rate of return on capital .... 78% (c) (a) would signify a high-risk venture due to high production and overhead costs. A slight cost overrun could result in a loss. To compensate for this factor, the project should be capable of high (b) and (c) in order that the project be viable. Given these measures of the project\u27s feasibility, we recommend that the proposed Mechanized Poultry Farm and Processing Plant be pushed through