The road to becoming a successful poultry farmer is littered with obstacles, but success is not beyond the reach of small-scale farmers, if only they came together in well organised associations.
Small-scale farmers put a lot of effort and successfully raise a significant number of chicken. However, many of these small-scale poultry farmers have no choice but to sell a batch of fully-grown chickens one at a time. This is not conducive to running an efficient poultry farming business. This is why I am encouraging the formation of cluster groups to overcome these and other challenges, such as access to feed, vaccines and funds for expansion.
“People must stop working in silos and stop with the jealousy,” Ajallon Zondi, South African poultry expert once said. “Ajallon is a hatchery owner and observes that, “Farmers living in the same area are growing 500 chicks at the same time and then fighting for a market where each manages to sell just a few chickens at one at the lowest imaginable prices. Yet if they operate as a cluster, and co-ordinate and stagger production, they could go to a local market with a steady supply of 500 chickens a week. Transport and abattoir clusters can also be formed. Clusters working together can become a business unit.”
Secure a market first
I will borrow a leaf from another South African expert, Dr Shelley Johnston, a director and consultant facilitator at the KwaZulu-Natal Poultry Institute (KZNPI), who says, “Too often, we see farmers producing chickens and eggs and then trying to find a market for their goods. That’s the wrong way to go about things,” she says.
“If you don’t have customers, you don’t have a business. Ask your neighbours and local shops where they source eggs and chickens from. Find out what they pay, what quantity they buy, and whether or not they’re happy with their current supplier.”
The next step is to scout for a suitable area to farm.
Dr Shelley Johnston observes that the common business dynamics of supply vs price perfectly applies in the poultry business. She says, “If there are too many poultry farmers in an area, the price of poultry products drops. But if there’s a shortage in the area, the price goes up. So find an area where there’s a broad range of farming activities on the go.”
Another reason to find land far from other poultry farms is to prevent the spread of airborne diseases. “You also need to find a site with clean water, electricity, good roads, a moderate climate and close proximity to markets,” explains Johnston.
Start small
“Find yourself a niche market and go through the process of learning and expanding. Don’t expect overnight success,” she advises. While large agribusinesses benefit from economies of scale, small farmers can make more money per unit because they often sell directly to customers. “They may sell small volumes, but margins will be higher,” Johnston says.
She adds, however, that marketing is an active process. “Go and look for customers. Don’t wait for them to find you.”
Manage the money carefully
Once income starts coming in from selling eggs and broilers, it is crucial to manage the finances well. “Always have cash in the bank,” says Johnston. “The income you earn is not your profit. Don’t blow it. Put it in the bank and draw a small salary.” Now that is a point most of us miss.
The profit from the first and subsequent ventures should be banked and used to expand the business. “In this way, your business will grow, you will employ people to help, and your salary can increase,” says Johnston.
“The golden rule for new businesses is simple. The first aim is to stay in business. The second aim is to make profits!” The ultimate one is to grow!
