Planning any business begins with calculations. After all, before investing, you need to understand the approximate costs and profit from the activity. A business plan is also required by banks, employment centers, and international organizations that provide financial assistance for business development or support.
To correctly calculate the business plan, you need to do a little research, namely to find out the prices of walnuts, rent of premises, equipment, and wages, if you plan to hire employees.
The main directions of the walnut business, in which most entrepreneurs make money:
- Purchase and sale of walnuts.
- Processing of walnuts into kernels.
When buying/selling walnuts, earnings are made at the expense of the difference between buying walnuts from the public and selling them to processors and exporters.
The scheme of work is approximate as follows:
1. Purchase of walnuts from the population from private yards, at mobile points of purchase in the markets of small towns and villages, at a stationary point in the market of large cities, through walnut chats in social networks and on bulletin boards
2. Pre-sale processing of the walnut. This can be cleaning the walnut from the green skin, if such a walnut was accepted, drying the walnut, if the purchase took place at the beginning of the walnut season, calibrating the walnut by size
3. Formation of large batches, sale of walnuts to processors or companies that export walnuts.
For calculations, you need to take the value of the walnut in the shell. The cost will vary depending on the region and the quality of the walnut. For example, a walnut in a green shell is bought at the lowest price, and a clean dried walnut will cost more.
Example of calculations:
- Walnuts are purchased at the price of UAH 17 per kilogram. 17,000 UAH is obtained for 1000 kg.
- Having formed large batches of walnuts, you can sell them for UAH 20 per kilogram. 20,000 UAH is obtained for 1,000 kg.
- Earnings for 1 ton of walnuts - 3000 hryvnias.
The main costs are for walnut storage and drying if the walnut was taken freshly picked.
The sale price of a walnut increase if it is additionally processed - washed, dried, calibrated, and packed in nets. In these cases, depreciation of equipment, electricity costs, and wages of workers are added to the costs.
The larger the volume and the more prepared the walnut, the higher the earnings.
When processing into a kernel, the profit is made between the purchase price of the walnut in the shell and the sale price of the cleaned kernel.
The scheme of work is approximate as follows:
1. Purchase of walnuts for processing from the population or walnut harvesters.
2. Direct processing of the walnut - calibration of the walnut to increase the yield of the whole kernel, cracking, and sorting of the kernel.
3. Kernel sales
The selling price of the kernel will depend on the quality - it is a whole kernel or crumbs, a light kernel, or a dark one.
Example of calculations:
- Purchase of dried walnuts for UAH 20 per 1 kg. 20,000 UAH is obtained for 1,000 kg.
- From 1000 kg of walnuts in the shell, you can get 350 kg of the pure kernel.
- To calculate the cost of a kernel, let's take as an example - UAH 100 per kilogram (this is the average or below the average price for a kernel).
- For 350 kg, you can get about UAH 35,000.
- Earnings for 1 ton - UAH 15,000.
The main expenses are the rent of premises and payment of electricity, depreciation of equipment and payment of the work of employees.
The price of walnut is taken as an example based on the average price over the past few years in one of the regions of Ukraine. At the moment of drafting the business plan, the prices will differ from those indicated in this article. This is just a formula or an example by which you can draw up a personal business plan.
To calculate your own business plan, you need to take current prices for walnuts in your region, rent of premises, cost of electricity and payment of work. After all, the amount of these costs will vary depending on the region, for example, in large cities, the rent of premises and the payment of labor will always be higher, and in small cities and towns - it will be lower.