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Cotton Production and Processing Business Plan

Introduction

Cotton as a major cash crop is of considerable social and economic importance to Nigeria. Cotton/textile activities are widespread in the country. Its production in Nigeria dates back to 1903 with the British Cotton Growers Association taking the lead until 1974, when it was disbanded and replaced by the Cotton Marketing Board to develop, gin and market the produce.  Cotton is a soft and fluffy staple fibre that grows in a boll, or a protective capsule, around the seeds of cotton seeds of the cotton plants of the genus Gossypium. The fibre is almost pure cellulose.

 

The plant is shrub that is native to tropical and subtropical regions around the world, including the Americas, Africa and India. The greatest diversity of wild cotton species is found in Mexico, followed by Australia and Africa. Cotton was independently domesticated in the Old and New Worlds. The fibre is most often spun into a yarn or thread to make a soft breathable fabric.

There are four commercially grown species of cotton; and they include;

  1. Gossypium hirsutum
  2. Gossypium barbadense
  • Gossypium arboretum
  1. Gossypium herbaceum

Cotton has been spun, woven, and dyed since prehistoric times. It clothed the people of ancient India, Egypt, and China. Hundreds of years before the Christian era, cotton textiles were woven in India with matchless skill, and their use spread to the Mediterranean countries and beyond.

Cotton is usually harvested mechanically, either by a cotton picker, a machine that removes the cotton from the boll without damaging the cotton plant, or by a cotton stripper, which strips the entire boll off the plant. Cotton strippers are used in regions where it is too windy to grow picker varieties of cotton, and usually after application of a chemical defoliant or the natural defoliation that occurs after a freeze. Cotton is a perennial crop that is grown in the tropics, and without defoliation or freezing, the plant will continue to grow. Cotton is also harvested / picked by hand.

As a business, Cotton Production and Processing offers an opportunity for Cotton farmers and marketers to earn steady income and also provide employment opportunities for countless number of men and women. On a national scale it also helps to reduce our dependence on other countries to meet our increasing food demand.

Hence starting a Cotton farm of your own either on a large, small or medium scale is indeed a very wise decision as this will bring you immense financial benefit both in the short and long term.

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Table of ContentPages
Executive Summary 4
Introduction 6
Business Description 7
Vision8
Mission8
Objectives8
Keys to success 9
Products and services9
Market Analysis 10
Target market 11
Pricing strategy 11
Competitor Analysis 12
Sales and Marketing Plan 12
Promotion13
Distribution13
Pricing13
Risk14
Swot analysis 14
Pest analysis16
Operational Plan 16
Staff requirement 20
Management plan21
Financial Plan and Projections 22
Financial Diagnostics 23

Executive Summary

Overview

PATILAD Cottons Ltd. is a 15,000-ha commercial cotton production and processing firm.

Cotton a major cash crop that is of social and economic importance to Nigeria.

We produce high quality cotton that is useful for clothing, household items and industrial products. We are located in Ile-Oluji, Ondo state.

The Company

           

PATILAD Cottons Ltd. is established as a limited liability company owned by Dayo Adetiloye, Adebayo Tijani, and other investors. 

The farm is managed and directed by Dayo Adetiloye, a veteran in the Agric. industry with 8 years’ experience and Adebayo Tijani, an experienced Agro-allied specialist with over 15 years’ experience.

Products and Services

PATILAD Cottons Ltd. will sell healthy, stain-free and highly quality Cotton balls.

Other products and services include supply of high-quality improved cotton seedlings, cotton seed and leasing of equipment and storage facilities to farmers, etc.

We produce process and package to meet standard organization of Nigeria and international standard.

We are concerned about providing products that suit the many use of Cotton balls either for export or local industrial uses.

The Market

Cotton is a part of our daily lives from the time we dry our faces on a soft cotton towel in the morning until we slide between fresh cotton sheets at night.

It has hundreds of uses, from blue jeans to shoe strings. Clothing and household items are the largest uses, but industrial products account for many thousands of bales.

All parts of the cotton plant are useful. The most important is the fibre or lint, which is used in making cotton cloth.

Linters, provide cellulose for making plastics and other products. Linters also are incorporated into high quality paper products and processed into batting for padding mattresses, furniture and automobile cushions

Competition

Competitors for PATILAD Cottons Ltd. includes renown agricultural produce marketer in Nigeria and other west African state.

PATILAD Cotton Ltd’s competitive edge includes the use of modern production techniques and equipment which turns out high quality products, excellent customer service, the expertise of its founders, etc. 

Financial Considerations

PATILAD Cottons Ltd. seeks N15 million in long-term financing to cover start-up costs, equipment, building expenses, and working capital.

Funding for the launch of the business is provided primarily by equity from the partners and investors.

The business will reach positive cash flow in its 10th month of operation, allowing for expedited repayment of its loan obligations, as well as for dividends to be paid to the owners. 

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