PRODUCT
Chikanda is a vegetable that tastes like french polony. It can be served with nshima(pap) or can be taken as a snack. It is rich in minerals, proteins and calcium. Chikanda is made from orchids that grow naturally in the wild. The main ingredients for Chikanda are groundnuts, salt, chili and soda. Though Chikanda is widely eaten in Zambia, Malawi and Tanzania, it is not produced on a large scale commercial basis. It is usually sold by women street vendors which compromises the hygiene for the food. Packaged Chikanda is hygienically prepared using a production process that strictly adheres to regulations that govern food production in Zambia. The product contains soda and chili. It is therefore not recommended for people who do not take soda or chili. Packaged Chikanda will be sold in selected supermarkets and groceries across Zambia and later be exported to Malawi and Tanzania. TECHNICAL VIABILITY
To produce packaged Chikanda on a large scale commercial basis will require:
10 x 50 litre industrial pots
5 x industrial gas stoves
1 x Slicing machine
1 x packaging machine
10 x specially designed cooking sticks
Packing materials will be outsourced. A trained food technologist will be needed to ensure the Chikanda is produced safely, legally and is consistent with quality standards. The food technologist will also assist in ensuring the right equipment is bought for the business. In future, the plant will be upgraded to produce Chikanda that is fortified with vitamin A which is good for eye sight. The business will be located at No. 34 Kwacha road, Light Industrial Area, Kitwe, Zambia. The premises comprises a 4 room office block as well as a 20 m x 30m building which will serve as the factory for the packaged chikanda. BUSINESS MODEL
The business will generate revenue through customer purchases. Most of the revenue will come from lower to middle income people. Chikanda is a traditional food that is rich in minerals, proteins and calcium. It contains no saturated fats. There is no packaged Chikanda on the market, this is what makes the product unique. In addition, nutritional information will be indicated on the packaging. This will assist potential buyers to know the nutritional contents of the food delicacy. BASIS FOR COMPETITIVE ADVANTAGE
Innovative packaging and continuous product differentiation through addition of nutritional ingredients and improved recipes. MARKET AND MARKETING VIABILITY
Chikanda is a food product that is widely eaten. Packaged Chikanda is tailored for the low to middle income people. The biggest market is Lusaka and Copperbelt provinces of Zambia. Chikakanda will be sold to the market through selected supermarkets and township groceries. Industry
The food industry in Zambia is highly regulated. The country is promoting indigenous foods which are natural because they do not pose a danger to human health as opposed to genetically engineered foods. Competition
Direct competition is from women street vendors who sell the product in shop corridors and market stalls. However, the chikanda sold women street vendors is not packaged and is shunned by many potential buyers who are hygiene conscious. Manufacturers of products like french polony offer indirect competition. Many people who like Chikanda also have a craving for french polony. MARKETING AND SALES STRATEGY
The Chikanda will be packaged in 250g and 500g plastics with nutritional information, date of manufacture and expiry date indicated. The packaging will have a picture of the mouth watering chikanda will have a map of Zambia on the side and the words " A taste of African magic". The business also intends to enter into strategic alliances with restaurants in Lusaka and Copperbelt provinces to offer Chikanda on their menu. Chikanda will be distributed via 1 tonne containerized vans to supermarkets and groceries shops. In order to reach a wider audience, adverts for the packaged Chikanda will be aired on YAR fm and Radio 4 which are popular radio stations on the Copperbelt and Lusaka. Market pe*******on pricing strategy which will involve low end prices to gain customer attention and build market share will be used
MANAGEMENT MODEL
Business Manager
Planning, organizing and directing business functions; establing
and maintaining accounting procedures, fiscal reporting
requirements and budgeting. Analyzing expenditures and other financial data and preparing
monthly operations reports. Marketing and sales Manager
Assisting in the development of the sales and marketing plan; specifically advising on realistic sales forecasts for packaged chikanda. Evaluating marketing and sales performance and conducting market research. Ensuring continuous supply of packaged chikanda on the market. Food technologist
generating ideas for improving Chikanda
designing processes and machinery for the production of chikanda on a large scale
liaising with marketing staff
ensuring that stringent hygiene food safety standards are met
monitoring the use of additives
testing and examining samples
writing reports
BREAK EVEN ANALYSIS
Estimated fixed costs/ month in Zambian Kwacha
Rent K15,500
Salaries K20,000
Equipment K16,800
Motor vehicles K56,000
Total = K108,300
Estimated variable cost per 250g packet
Direct materials K4
Marketing and Distribution costs K2
Total variable cost per 250g packet = K6
Estimated selling price per 250g packet = K10
Contribution per 250g packet = K10-K6 = K4
Break-even point in units per month = fixed costs\contribution per packet
= K108, 300/4
= 27,075 packets
SWOT ANALYSIS
STRENGTHS
Experienced food technologists
Innovative Packaging
CAPITALIZING ON STRENGTHS
Offer good incentives, offer opportunities for further training
Continuously improve product packaging to make the product more appealing to customers. Provide nutritional information on packaging. Invest in modern packaging equipment. WEAKNESSES
Financial resources
Lack of retail distribution channels
ADDRESSING WEAKNESSES
Seek partners who have finances to invest in the business. Seek bank financing or government grants. Negotiate with selected supermarkets and groceries to sale product on the company’s behalf by offering attractive commission on sales. OPPORTUNITIES
High demand for indigenous foods which are considered healthier
Weak competition
Potential for new product development
Availability of raw material (Chikanda orchid plant grows naturally in the wild)
MAXIMIZING ON OPPORTUNITY
Emphasis health benefits of consuming natural indigenous foods such as chikanda through awareness campaigns
Build brand loyalty to consolidate market position
Continuously invest in research and development to add more nutritional value to the chikanda. Fortify chikanda with vitamin A which is good for eye sight. Ensure more efficient supply chain by creating strategic alliances with locals in areas where the Chikanda orchid plant is found. Create income for locals who supply the raw material. THREATS
Depletion of the Chikanda orchid plant
New entrants
MINIMIZING ON THREATS
Invest in chikanda orchid plant farming
Offer product differentiation through innovative packaging and additional nutritional value, develop workforce with unique capabilities in the production of chikanda. Capitalize on experience to offer low price that new entrants can not match. CONCLUSION
There is great demand for organic and natural indigenous foods in the country. Many people are resorting to consuming indigenous locally made foods as opposed to genetically modified foods because such food is considered healthier and contains less toxins. Not long ago, the Zambian government banned the importation of genetically modified maize because of the health risks associated with genetically modified foods. Local indigenous foods like chikanda offer a healthier and cheaper alternative to other foods. All 32 prospective customers interviewed indicated they would definitely buy packaged chikanda if it was hygienically produced and well packaged. The prospect of packaged chikanda succeeding on the market is high. The business to produce packaged chikanda is therefore viable.
