In South Africa just like in some countries in Africa, it can be truly challenging starting any business, but one business that you can start with little challenges and wide market coverage is a butchery business or better still slaughterhouse business.
If you are considering starting a butchery business in South Africa, the good news is that you can’t get it wrong because various types of animals are consumed by a large number of South Africans. Please note that starting a butchery business in South Africa requires that you secure the necessary permits from regulatory bodies, although some entrepreneurs run this type of business in SA without the required permits.
So, if you have decided to start your own butchery business, then you should ensure that you carry out thorough feasibility studies and market survey, and secure the needed public health and hygiene certificates and permits. This will enable you to properly locate the business in a good location and then hit the ground running.
Business plan is yet another very important business document that you should not take for granted when launching your butchery business. Below is a sample butchery business plan template that can help you to successfully write your own with little or no difficulty.
A Sample Butchery Business Plan Template
1. Industry Overview
Butchery business falls under the Meat, Beef & Poultry Processing industry and businesses in this industry basically engage in the slaughtering of livestock to produce red meat. The butchery business also produces fresh or frozen meat as carcasses and cuts, in addition to by-products like rendered lard, tallow, pulled wool, bone, preserve and pack meat. It is important to state businesses that primarily cut and pack meats from purchased carcasses are also part of this industry.
In South Africa, to become a professional butcher, training is essential and short training courses for a minimum of two weeks are available in South Africa. The training of butchery staff is addressed in the R918 ‘Regulations Governing General Hygiene Requirements for Food Premises and the Transport of Food’ of the Health Act, 1977, as well as in the Occupational Health and Safety Act.
Even though meat consumption based on per capita income is expected to remain stagnant in the next half a decade, economic woes before this period aggravated consumption drops.
Because of recovering consumer sentiment, population growth and strong export demand, meat-processing revenue is projected to increase going forward. In spite of the stability of consumer demand for meat-based products, unpredictable weather conditions and disease outbreaks can cause instability in the revenue generated by industry players.
The butchery business in South Africa will continue to blossom because people will always want to purchase fresh meat. Despite the fact that the industry seems over – saturated, there is still room big enough to accommodate aspiring entrepreneurs who intend opening their own butchery business in any part of South Africa.
In South Africa and of course, in all countries of the world, butchers are required to adhere to stringent hygiene regulations and to undertake general cleaning tasks in the meat preparation and serving areas. Professional butchers may require particular skills and knowledge.
If you are looking towards leveraging on the beef, meat and poultry processing industry to generate huge income, then one of your best bet is to start a butchery business. One thing is certain about starting your butchery business, if you are able to conduct your market research and feasibility studies, you are more likely not going to struggle to sell your meat because there are loads of businesses (hotels, caterers and restaurants) and consumers out there who are ready to buy from you.
2. Executive Summary
Durban City® Butchery House, LLC is a registered butchery business that will be involved in the slaughtering and retailing of fresh meat. Our slaughterhouse will be located close to one of the largest residential communities in Durban – KwaZulu-Natal Province. We have been able to lease a warehouse cum storage facility that is big enough to fit into the kind of butchery business that we intend launching and the facility is centrally located in the heart of town with easy delivery network.
Durban City® Butchery House, LLC will be involved in butchering of animals, producing cuts of beef, lamb, pork, other red meats and selling by-products from the slaughtering process to a wide range of customers.
We are aware that there are several butchery businesses all around Durban that are also into meat and beef retailing, which is why we spent time and resources to conduct our feasibility studies and market survey so as to offer much more than our competitors will be offering. We have a robust distribution network, strong online presence and modern storage facilities and we are armed with the various payments options available in South Africa.
Much more than retailing meats, our customer care is going to be second to none in the whole of Durban – KwaZulu-Natal Province and our deliveries will be timely and highly reliable. We know that our customers are the reason why we are in business which is why we will go the extra mile to get them satisfied when they patronize us.
Durban City® Butchery House, LLC will ensure that all our customers are given first class treatment whenever they visit our butchery facility. We have a CRM software that will enable us manage a one on one relationship with our customers no matter how large they may grow to. We will ensure that we get our customers involved in the selection of the types of animal to be butchered and also when making some business decisions that will directly affect them.
Durban City® Butchery House, LLC will at all times demonstrate her commitment to sustainability, both individually and as a firm, by actively participating in our communities and integrating sustainable business practices wherever possible. We will ensure that we hold ourselves accountable to the highest standards by meeting our client’s needs precisely and completely.
Durban City® Butchery House, LLC is a family business that is owned by Eric Zulu and his immediate family members. Eric Zulu is a professional butcher with over 10 years’ experience.
3. Our Products and Services
Durban City® Butchery House, LLC is in the butchery line of business to retail fresh meats and we will ensure that we are involved in butchering a wide range of animals that are consumed in South Africa. Our products and services offerings are listed below;
- Butchering animals
- Producing cuts of beef
- Producing cuts of lamb
- Producing cuts of pork
- Producing cuts of other red meats
- Selling by-products from the slaughtering process.
4. Our Mission and Vision Statement
- Our vision is to become one of the leading brands in the butchery line of business in the whole of Durban – KwaZulu-Natal.
- Our mission is to establish a butchery business that will slaughter and sell a wide range of animals at affordable prices to wholesalers and retailers in and around Durban.
Our Business Structure
Durban City® Butchery House, LLC has no plans to start an unregistered butchery business; our intention of starting a butchery business is to build a standard butchery in Durban – KwaZulu-Natal. We will ensure that we put the right structures in place that will support the kind of growth that we have in mind while setting up the business.
We will make sure that we hire people that are qualified, honest, customer centric and are ready to work to help us build a prosperous business that will benefit all our stake holders. As a matter of fact, profit-sharing arrangement will be made available to all our old staff and it will be based on their performance for a period of ten years or more.
In view of that, we have decided to hire competent hands to occupy the following positions that will be made available at Durban City® Butchery House, LLC;
- Manager (Owner)
- Warehouse/Storage Facility Manager
- Merchandize Manager
- Sales and Marketing Manager
5. Job Roles and Responsibilities
- Increases management’s effectiveness by recruiting, selecting, orienting, training, coaching, counseling, and disciplining managers; communicating values, strategies, and objectives; assigning accountabilities; planning, monitoring, and appraising job results; developing incentives; developing a climate for offering information and opinions
- Creates, communicates, and implements the organization’s vision, mission, and overall direction – i.e. leading the development and implementation of the overall organization’s strategy.
- Accountable for fixing prices and signing business deals
- Responsible for providing direction for the business
- Accountable for signing checks and documents on behalf of the company
- Evaluates the success of the organization
Warehouse cum Storage Facility Manager
- Responsible for organizing the safe and efficient receipt, storage and dispatch of slaughtered animals and byproducts
- In charge of planning, coordinating and monitoring the receipt, order assembly and dispatch of slaughtered animals and byproducts
- Responsible for using space and mechanical handling equipment efficiently and making sure quality, budgetary targets and environmental objectives are met
- Responsible for keeping stock control systems up to date and making sure inventories are accurate;
- Ensures that proper records of goods are kept and warehouse does not run out of products
- Ensures that the slaughterhouse facility is in tip top shape and meets the health and safety requirements
- Controls meat, beef and poultry meat distribution and supply inventory
- Supervises the workforce in the butchery floor.
- Manages vendor relations, farm cum market visits, and the ongoing education and development of the organizations’ buying teams
- Responsible for the purchase of cows, goats, pigs, turkeys and chickens et al directly from farmers for the organization
- Responsible for planning sales, monitoring inventory, selecting the merchandise, and writing orders for vendors
- Ensures that the organization operates within stipulated budget.
- Responsible for butchering animals
- Responsible for cleaning the slaughterhouse before and after butchering of animals
- Handle any other duty as assigned by the manager (owner)
Sales and Marketing Manager
- Manages external research and coordinate all the internal sources of information to retain the organizations’ best customers and attract new ones
- Models demographic information and analyze the volumes of transactional data generated by customer purchases
- Identifies, prioritizes, and reaches out to new partners, and business opportunities et al
- Identifies development opportunities; follows up on development leads and contacts; participates in the structuring and financing of projects; assures the completion of development projects.
- Responsible for supervising implementation, advocate for the customer’s needs, and communicate with clients
- Develops, executes and evaluates new plans for expanding sales
- Documents all customer contact and information
- Represents the company in strategic meetings
- Helps increase sales and growth for the company
- Responsible for preparing financial reports, budgets, and financial statements for the organization
- Provides managements with financial analyses, development budgets, and accounting reports; analyzes financial feasibility for the most complex proposed projects; conducts market research to forecast trends and business conditions.
- Responsible for financial forecasting and risks analysis.
- Performs cash management, general ledger accounting, and financial reporting
- Responsible for developing and managing financial systems and policies
- Responsible for administering payrolls
- Ensuring compliance with taxation legislation
- Handles all financial transactions for the organization
- Serves as internal auditor for the organization
Distribution Truck Drivers
- Assists in loading and unloading live cows, goats, pigs and birds et al and also slaughtered animals
- Maintains a logbook of their driving activities to ensure compliance with federal regulations governing the rest and work periods for operators.
- Keeps a record of vehicle inspections and make sure the truck is equipped with safety equipment
- Assists the transport and logistics manager in planning their route according to a distribution schedule.
- Local-delivery drivers may be required to sell meat, beef and poultry et al or services to stores and businesses on their route, obtain signatures from recipients and collect cash.
- Inspects vehicles for mechanical items and safety issues and perform preventative maintenance
- Complies with truck driving rules and regulations (size, weight, route designations, parking, break periods etc.) as well as with company policies and procedures
- Collects and verifies delivery instructions
- Report defects, accidents or violations
6. SWOT Analysis
Our plan of starting our butchery business in Durban – KwaZulu-Natal is to test run the business for a period of 6 years to know if we will invest more money, expand the business and then open our slaughterhouse in major cities in South Africa.
We are quite aware that there are several butchery businesses all over Durban and even in the same location where we intend locating ours, which is why we are following the due process of establishing a business. We know that if a proper SWOT analysis is conducted for our business, we will be able to position our business to maximize our strength, leverage on the opportunities that will be available to us, mitigate our risks and be equipped to confront our threats.
Durban City® Butchery House, LLC employed the services of an expert HR and Business Analyst with bias in the meat, beef, and poultry processing industry to help us conduct a thorough SWOT analysis and to help us create a Business model that will help us achieve our business goals and objectives.
This is the summary of the SWOT analysis that was conducted for Durban City® Butchery House, LLC;
Our location, the business model we will be operating on, varieties of payment options, healthy environment, latest butchery equipment and our excellent customer service culture will definitely count as a strong strength for Durban City® Butchery House, LLC. So, also our management team are people who have what it takes to grow a business from startup to profitability with a record time.
One major weakness that may count against us is the fact that we don’t have our cattle ranch and we don’t have the financial capacity to compete with leaders in the industry for now.
The fact that we are going to be operating our butchery business in Durban – KwaZulu-Natal which happens to be one of the provinces with high purchasing power provides us with unlimited opportunities to sell our fresh meats to a large number of wholesale distributors and retailers.
We have been able to conduct thorough feasibility studies and market survey and we know what our potential clients will be looking for when they visit our butchery house; we are well positioned to take on the opportunities that will come our way.
Some of the threats and challenges that we are likely going to face when we start our own butchery business are global economic downturn that can impact negatively on household spending, bad weather cum natural disasters, unfavorable government policies and the arrival of a competitor within the same location where we have our butchery house.
7. MARKET ANALYSIS
- Market Trends
In recent time, consumers are become conscious or what they eat especially as it relates to meat. Those advocating for healthy eating are against the consumption of meat especially red meat. With that, it takes extra effort for those in the butchery business to canvass such people to patronize them especially those who are under a nutritionist.
The truth is that slaughtering of animals for food has been in existence for as long as humans started trading goods, but one thing is certain, the meat, beef and poultry processing industry is still evolving. The introduction of technology has indeed helped in reshaping the industry.
It is now a common phenomenon for butchery houses to leverage on technology to effectively predict consumer demand patterns and to strategically position their business to meet their needs; in essence, the use of technology helps businesses like slaughterhouses to maximize supply chain efficiencies.
8. Our Target Market
The meat, beef and poultry processing industry has a wide range of customers; a large chunk of people on planet earth consume different types of meat or poultry products and it is difficult to find people around who don’t.
In view of that, we have positioned our butchery business to serve consumers in and around Durban and every other location we will cover all over KwaZulu-Natal Province. We have conducted our market research and we have ideas of what our target market would be expecting from us. We are in business to engage in the sale of freshly butchered meats to the following businesses;
- BBQ joints
- Retailers of meat
- Grocery Stores
- Super Markets
- Wholesale Distributors of meats
Durban City® Butchery House, LLC is launching a standard butchery business that will indeed become the preferred choice of consumers, retailers, wholesale distributors, grocery stores and supermarkets et al in Durban – KwaZulu-Natal.
One thing is certain; we will ensure that we have a wide range of freshly butchered meat available in our warehouse facility at all times. One of our business goals is to make Durban City® Butchery House, LLC a one stop butchery. The fact that our output is sold to incorporate long-term sales contracts, and that we enjoy upstream vertical integration (ownership links) and economies of scale gives us an edge over our competitors.
So also, our excellent customer service culture, neat and healthy environment, timely and reliable delivery services, online presence, and various payment options will serve as a competitive advantage for us.
Lastly, our employees will be well taken care of, and their welfare package will be among the best within our category in the industry meaning that they will be more than willing to build the business with us and help deliver our set goals and achieve all our objectives. We will also give good working conditions and commissions to freelance sales agents that we will recruit from time to time.
9. SALES AND MARKETING STRATEGY
- Sources of Income
Durban City® Butchery House, LLC is in business to engage in slaughtering animals and retailing fresh meats and byproducts. We are in the business to maximize profits and we are going to go all the way out to ensure that we achieve or business goals and objectives. In essence, our source of income will be;
- Butchering animals
- Producing cuts of beef
- Producing cuts of lamb
- Producing cuts of pork
- Producing cuts of other red meats
- Selling by-products from the slaughtering process
10. Sales Forecast
The truth is that when it comes to butchery business, if your business is centrally positioned coupled with a reliable supply of healthy animals and good distribution network, you will always attract customers cum sales and that will sure translate to increase in revenue for the business.
We are positioned to take on the available market in Durban – KwaZulu-Natal and we are quite optimistic that we will meet our set target of generating enough income from the first six months of operation and grow the business and our clientele base.
We have been able to critically examine the meat, beef and poultry processing industry, we have analyzed our chances in the industry and we have been able to come up with the following sales forecast. The sales projections are based on information gathered on the field and some assumptions that are peculiar to startups in Durban – KwaZulu-Natal.
- First Fiscal Year: R300,000
- Second Fiscal Year: R650,000
- Third Fiscal Year: R900,000
N.B: This projection was done based on what is obtainable in the industry and with the assumption that there won’t be any major economic meltdown and there won’t be any major competitor offering same products and home delivery services as we do within the same location. Please note that the above projection might be lower and at the same time it might be higher.
- Marketing Strategy and Sales Strategy
Prior to settling for a location to launch Durban City® Butchery House, LLC, we conducted a thorough market survey and feasibility studies in order for us to penetrate the available market and become the preferred choice for households, wholesale distributors, retailers, grocery stores and supermarkets in and around Durban – KwaZulu-Natal.
We have detailed information and data that we were able to utilize to structure our business to attract the number of customers we want to attract per time.
We hired experts who have good understanding of the industry to help us develop marketing strategies that will help us achieve our business goal of winning a larger percentage of the available market in and around Durban – KwaZulu-Natal.
In summary, Durban City® Butchery House, LLC will adopt the following sales and marketing approach to win customers over;
- Open our business in a grand style with a party for all
- Introduce our business by sending introductory letters alongside our brochure to households, restaurants, hotels, caterers, BBQ joints, wholesale distributors, retailers, grocery stores, supermarkets and other key stake holders in and around Durban – KwaZulu-Natal
- Ensure that we have a wide range of meat in our butchery business at all times
- Make use of attractive hand bills to create awareness of our business
- Position our signage / flexi banners at strategic places around Durban – KwaZulu-Natal
- Create a loyalty plan that will enable us reward our regular customers
11. Publicity and Advertising Strategy
In spite of the fact that our butchery business is well structured and well located, we will still go ahead to intensify publicity for the business. We are going to explore all available means to promote the business.
Durban City® Butchery House, LLC has a long-term plan of opening distribution channels all around KwaZulu-Natal Province and key cities throughout South Africa which is why we will deliberately build our brand to be well accepted in Durban before venturing out.
As a matter of fact, our publicity and advertising strategy is not solely for winning customers over but to effectively communicate our brand. Here are the platforms we intend leveraging on to promote and advertise Durban City® Butchery House, LLC;
- Place adverts on community based newspapers, radio and TV stations
- Encourage the use of word of mouth publicity from our loyal customers
- Leverage on the internet and social media platforms like YouTube, Instagram, Facebook, Twitter, LinkedIn, Google+ and other platforms to promote our business.
- Ensure that our we position our banners and billboards in strategic positions all around Durban
- Distribute our fliers and handbills in target areas in and around our neighborhood
- Advertise our butchery business in our official website and employ strategies that will help us pull traffic to the site
- Brand all our distribution vans/trucks and ensure that all our staff members wear our branded shirt or cap at regular intervals.
12. Our Pricing Strategy
Meats are sold in Kilograms in South Africa. Our pricing system is going to be based on what is obtainable in the butchery line of business, we don’t intend to charge more and we don’t intend to charge less than our competitors are charging in South Africa.
Be that as it may, we have put plans in place to offer discounts once in a while and also to reward our loyal customers especially when they refer clients to us or when they purchase over R5000 worth of meat per time.
The prices of our meat will be same as what is obtainable in the open market and it will be based on miles covered and time.
- Payment Options
The payment policy adopted by Durban City® Butchery House, LLC is all inclusive because we are quite aware that different customers prefer different payment options as it suits them but at the same time, we will ensure that we abide by the financial rules and regulation of the government of South Africa
Here are the payment options that Durban City® Butchery House, LLC will make available to her clients;
- Payment with cash
- Payment via credit cards / Point of Sale Machines (POS Machines)
- Payment via POS machines
- Payment via online bank transfer
- Payment via check
In view of the above, we have chosen banking platforms that will enable our clients make payment for meat, beef and poultry purchase without any stress on their part. Our bank account numbers will be made available on our website and promotional materials.
13. Startup Expenditure (Budget)
From our market survey and feasibility studies, we have been able to come up with a detailed budget of how to achieve our aim of establishing a standard butchery business in Durban – KwaZulu-Natal. We know that no matter where we intend starting our butchery business, we would be required to fulfill most of the items listed below;
- The total fee for incorporating the business in South Africa – Name reservation application costs R50 and company registration R125
- Legal expenses for obtaining licenses and permits as well as the accounting services (software, P.O.S machines and other software) – R3,300.
- Marketing promotion expenses for the grand opening of Durban City® Butchery House, LLC the amount of R3,000 and as well as flyer printing (2,000 flyers at R0.04 per copy) for the total amount of R3,580.
- The cost for hiring business consultant – R2,500.
- The cost for insurance (general liability, workers’ compensation and property casualty) coverage at a total premium – R2,400.
- The cost for payment of rent for 12 months at R1.76 per square feet warehouse facility in the total amount of R120,000
- The total cost for facility remodeling (construction of drainages et al) – R20,000.
- Other start-up expenses including stationery (R500) and phone and utility deposits (R2,500).
- Operational cost for the first 3 months (salaries of employees, payments of bills et al) – R60,000
- The cost for Start-up inventory – R100,000
- Storage hardware (bins, rack, shelves, food case) – R3,720
- The cost for store equipment (cash register, security, ventilation, signage) – R13,750
- The cost of purchase and installation of CCTVs – R5,000
- The cost for the purchase of furniture and gadgets (Computers, Printers, Telephone, TVs, Sound System, tables and chairs et al) – R4,000.
- The cost for the purchase of distribution vans / trucks – R25,000
- The cost of launching a website – R600
- Miscellaneous – R10,000
We would need an estimate of Three hundred and fifty thousand Rand (R350,000) to successfully set up our butchery business in Durban – KwaZulu-Natal.
Generating Startup Capital for Durban City® Butchery House, LLC
Durban City® Butchery House, LLC is a family business that is owned and financed by Eric Zulu and his immediate family members. They do not intend to welcome any external business partners which is why he has decided to restrict the sourcing of the startup capital to 3 major sources.
These are the areas we intend generating our startup capital;
- Generate part of the startup capital from personal savings
- Source for soft loans from family members and friends
- Apply for loan from my bank
N.B: We have been able to generate about R100,000 (Personal savings R80,000 and soft loan from family members R20,000) and we are at the final stages of obtaining a loan facility of R150,000 from our bank. All the papers and documents have been signed and submitted, the loan has been approved and any moment from now our account will be credited with the amount.
14. Sustainability and Expansion Strategy
The future of a business lies in the number of loyal customers that they have, the capacity and competence of their employees, their investment strategy and business structure. If all of these factors are missing from a business, then it won’t be too long before the business closes shop.
One of our major goals of starting Durban City® Butchery House, LLC is to build a business that will survive off its own cash flow without injecting finance from external sources once the business is officially running. We know that one of the ways of gaining approval and winning customers over is to retail/distribute our meat, beef and poultry a little bit cheaper than what is obtainable in the market and we are prepared to survive on lower profit margin for a while.
Durban City® Butchery House, LLC will make sure that the right foundations, structures and processes are put in place to ensure that our staff welfare are well taken of. Our company’s corporate culture is designed to drive our business to greater heights and training and retraining of our workforce is at the top burner.
We know that if that is put in place, we will be able to successfully hire and retain the best hands we can get in the industry; they will be more committed to help us build the business of our dreams.
- Business Name Availability Check: Completed
- Business Registration: Completed
- Opening of Corporate Bank Accounts: Completed
- Securing Point of Sales (POS) Machines: Completed
- Opening Mobile Money Accounts: Completed
- Opening Online Payment Platforms: Completed
- Application and Obtaining Tax Payer’s ID: In Progress
- Application for business license and permit: Completed
- Purchase of Insurance for the Business: Completed
- Leasing of butchery facility and remodeling the facility: In Progress
- Conducting Feasibility Studies: Completed
- Generating capital from family members: Completed
- Applications for Loan from the bank: In Progress
- Writing of Business Plan: Completed
- Drafting of Employee’s Handbook: Completed
- Drafting of Contract Documents and other relevant Legal Documents: In Progress
- Design of The Company’s Logo: Completed
- Printing of Packaging Marketing/Promotional Materials: In Progress
- Recruitment of employees: In Progress