Greenhouses for growing organic
more than 3 years
An operating business for the cultivation and sale of organic vegetables and greens (Kiev region). Has been operating for over 5 years Min Invest amount $ 10,000. Profitability 25% per year in $
Details are set out in 2 presentations, more information below in the text, read to the end:
You have the opportunity to come on an excursion to the greenhouses (85 km from Kiev) and see how business works.
You can also talk with investors who have invested $ 850,000, $ 300,000, $ 150,000 in this project and find out about their experience of cooperation, profitability and other information .
For those interested, I will provide financial reports for the last 3 years of work, a financial model, a basic risk analysis.
25% per annum in dollars (or 31% per annum in UAH)
Additional details on the project
An operating business that has been working for more than 5 years and has shown its dynamics of development in terms of the number of greenhouses built, yield and products sold.
Dynamics of the project's development
2018 , sold products on 1 805 800,00 UAH , profit 1 127 873,00 UAH
2019, sold products on 5 829 824,85 UAH, profit 2 143 277,00 UAH
2020, sold products on 12 021 884,00 UAH , profit 6 339 587,00 UAH
The territory where the greenhouses are located has been certified by Organic Standard for 4 years in a row, which shows the high quality of the products.
Already built and operating 10,000 square meters of greenhouses.
The company provides a full cycle of production and sale of products all year round: growing, collecting, packing and selling.
2.Sales of products
At the moment we have more than 2000 regular customers, these are individuals who order baskets with vegetables and greens. With such greenhouse areas, our business is far from being able to meet the demand of all willing consumers, and therefore we are interested in the construction of new greenhouses.
How we sell:
- we deliver orders directly to customers;
- we carry out the issuance of orders in 8 residential complexes in Kiev;
- we have 10 partner stores in Kiev that sell our products, and also work as points of issue of orders. Delivery of orders and products to such stores occurs at least once a week.
Also we have contract with network of food stores "Vine time". They are ready to order products from 10,000 sq m of greenhouses that will be built in the future. This factor will provide an additional sales opportunity.
3. How much investment has already been involved?
At the moment, the project involved investments of $ 1.4 million and built 10,000 sq. m of greenhouses. Investors receive payments.
I have possibility to organize communication with investors who have invested $ 850,000, $ 300,000, $ 150,000. That will give you chance to find out investor's real practice of cooperation with project and get information about profitability. Current Investors receive payments according to the schedule.
4. Guarantees for the investor
The investment is guaranteed by the land plot, the built greenhouse and equipment inside of greenhouse.
The full cost of one greenhouse construction ( 1000 sq. m.) is $ 165,000. It takes 6 months from the start of construction to the first harvest.
4.1. For investment amounts up to $ 165,000, a Cooperation Agreement is concluded according to which the investor becomes a member of the cooperative. The cooperative guarantees investments with a land plot and greenhouses.
Also, the investor is protected by the laws of Ukraine
"On agricultural cooperation"
4.2. For amounts over $ 165,000, individual conditions are provided for the investor (one of the options that was implemented with an investor for $ 850,000 is the creation of a Joint Legal entity, which is 100% owned by the investor, investments go to the authorized capital.
In this case, the land plot and the greenhouse are transferred to the ownership of the investor, until the return of the invested amount. The investor leases the greenhouse to the cooperative adn it grows, sells products and pays dividends to the investor.
All payments and hiring of contractors for the construction of the greenhouse take place after agreement with the investor.
Other details are set out in the memo:
5. Market. Why investing in organic cultivation will generate income?
5.1 Organic market is increasing in Ukraine.
According to researches of the organic market, which was conducted by Inform
center «Зелене досьє», ТОВ «Органік Стандарт» (Organic Standart) and FiBL (Switzerland)
in 2018 market of organic vegetables and fruits in Ukraine, was 20 MLN UAH.
in 2019 - 35 MLN UAH.
during 2015 - 2019 - Ukraine's organic products market has doubled
5.1 According to analysts of ProAgro, in 2016 the market for domestic demand for organic products increased by 18% and will continue to grow in 2017-2025.
5.2 According to the Food Department of the Ministry of Agrarian Policy, the organic direction annually grows by 18-20% (presentation "Organic marketing in Ukraine: realities and prospects").
5.3 According to research made by Tebodin Ukraine (2019) and the Swiss-Ukrainian project "Development of the organic market in Ukraine" (2012- 2016), the trend for organic products increased 7.5 times from 2010 to 2015.
5.4 According to APK-inform, the volume of the Ukrainian vegetable market is $ 2.5 BILLION. Every year, vegetables on amount $ 30 MILLION are imported, which could be grown in Ukraine. Our company grows vegetables all year round, sells them at average prices and thus replaces imports.
So organic, health care, agriculture are now in trend and will be in it for another 7-8 years. Also the deterioration of the climate is stable ensures the growth of the greenhouse industry by 20% annually.
6. How much investment the project is interested to accept?
The project is interested in accepting $ 1.65 MILLION investments, minimal amount is $ 10,000.
The funds will be used for the construction of greenhouse complexes with a total area of 5,000 sq.m.
Technical details of the complex are presented in the presentation.
7.1 For investment amounts over $ 165,000: first payment after 6 months. Further payments are made according to the schedule chosen by the investor (for example, once a month).
The sums of $ 165,000 enough to build a 10,000 square meter greenhouse in 6 months and harvest the first crop.
7.2 If the investment amounts are from $ 10,000 to $ 165,000: the first payment after 1 year, then 2 times a year.
8. Competitive advantages
8.1. Systematic work all year round. This means year-round sales and constant income for the investor and business.
8.2. Quality control according to organic farming standards. This means the high quality of the taste and the healthiness of our products.
8.3. Customer access to greenhouses. Everyone can get into the greenhouses and personally see how the products are grown, taste them and talk to the greenhouse staff. Such openness of business allows attracting more and more investors and clients.
8.4. Delivery of products directly to the end consumer. This sales model allows us to consistently sell organics during lockdowns and generate income.
9. Future plans
In the future, the business plans to launch 2 locations near Odessa and Kiev, with 20,000 sq m of greenhouses each. Investments over $ 3 MILLION will be engaged for the implementation of the locations.