The Financial angle of starting a poultry business!
Last week we did an episode on how to start up a poultry business. Thanks for all the comments, questions which has made us do a follow up on the financials angle.
Like any good business, poultry farming can deliver decent profit if well managed. It is a business that thrives on quantity as the profit may look small on a small base. Let me show you how to make money from poultry farming. To explain, i will use an example of 120 layer birds.
- Production: Remember that you will buy a Point of Lay bird of 16 weeks at about N900 each. This young layer/bird can lay eggs for about one year before it stops and can be sold as an old layer at about the same price of N800- N900. If you have 120 birds, you should get about 80% production every day when the layers are operating at their best. This means you get about 96 eggs per day (3 crates and 6 eggs) from 120 birds. To get the birds to lay well, they need to be well fed, drink clean water daily, take their vitamins and should be generally well taken care of. The vitamins are needed because the layers are laying eggs daily and they need the vitamins to replenish lost nutrients. There are several brands of vitamins out there for old layers.
When the layers get to about 9 months and their production drops to about 50%, you can also use egg booster to help them produce better. Note that egg boosters is not needed when the layers are still young and laying at about 80% because egg boosters will definitely increase production from about 80% to 85% but it will also make the birds stop laying about 3 months faster/earlier.
- Feeding/consumption: At maturity, the layers eat about 120g per day. So the 120 birds will eat about 14,400g per day. This is same as 14.4kg per day. The chicken feed is mostly sold in a 25kg bag. This means a bag of 25kg will almost feed about 120 birds for 2 days. I.e 120birds * 120g * 2 days= 28.8kg feed needed. A bag of 25kg feed is about N2,200.
- Gross margin in a month.
Sales; Remember we said 120 birds will give about 3 crates of eggs a day. In 30 days, that is 90 crates of eggs. 1 crate of egg is about N650 from the poultry farm (depending on location, it can be up to n700). So sales in a month is 3 crates * 30 days * 650 per crate = N58,500 sales per month.
Feeding cost; the 25kg bag of feed is almost enough for 120 birds in 2 days. In a month, you will need 15-16 bags. A bag of feed is about N2,200 so total cost of feeding in a month is N2,200 per bag * 16 bags = N35,200.
Vitamins: A sachet of vitamin is about N600. If you give them once a week, you need 4 a month, so N2,400. Ideally, you should give them twice a week.
Other costs; you need to get access to clean water for daily drinking, vaccination once every three months, space to raise the birds, initial start- up cost of setting up the deep-litter poultry system. .I recommend deep-litter for new poultry start up because it is cheaper unlike the battery cage that costs N80,000 for about 120 birds. You also need 1 staff to raise about 1000 birds.
Rough estimate on Profit: if you round up the total cost per month to about N40, 000, you can make a GROSS Margin of N20, 000 per month from 120 birds. In a year, this is N240,000. From this, you pay yourself a salary and re-invest the balance in growing the business. It may seem little but imagine when you increase from 120 birds to 1000 birds!!!! It is over 2 million naira a year.
If you missed the 1st episode, please see http://mrsceonaija.com/2015/08/13/how-to-start-a-poultry-farm-and-make-profit/
So what do you say?