We discussed twelve points that must be kept in mind when you are considering farming chickens for meat or eggs. This month we look at drawing up a budget to show you what the approximate cost will be, what expenses you can expect and what your profit could be.
To be able to draw up a budget, you will have to find out what materials, chickens and feed will cost in your area. It is not possible to provide these costs, as they may differ from one region to the next.
Visit several stores to get an idea of the prices of building materials for hen houses, namely wood for frames, corrugated iron for the roof and chicken wire for the sides. You can also find out what natural materials, like poles, thatch and reeds are available. Also find out what equipment is available for sale or see what you need to make on your own. All these aspects will be covered in more detail in this series of articles.
Find out from the veterinarian or Department of Agriculture extension officer about the vaccination routines they offer and at what cost. Also find out the cost of medicine and sanitiser for cleaning the hen houses, and to use in a footbath at the entrance to the shelter. Check the price of overalls and gumboots, as you need to wear a set of clean clothes when you enter the enclosure.
The extension officer may also be able to provide a contact number for a reliable supplier of day-old chicks, pullets, or point-of-lay hens. Find out from the supplier what these will cost, and whether they can be delivered to your home.
If not, find out about transport costs from the village to your home, as you will also need to transport building materials, feed for your chickens, and eventually to transport your chickens and eggs to the marketplace.
Look around in your yard and enquire from your neighbours what materials they can let you have to use as building materials or litter to put on the floor of the henhouse. Chopped maize stalks or other straw will provide suitable litter, so you don’t have to buy any.
If you don’t have electricity, find out what a paraffin or gas heater will cost, because the day-old chicks especially need warmth to keep them healthy and help them grow strong.
We cannot provide prices, as these may vary from area to area. The best would be to take some time to visit local shops to find out the prices of materials and contact suppliers of chickens and feed. You need to do your homework well so you will know what you are letting yourself in for.
Direct costs or expenses
Direct costs refer to the initial money you need to buy everything that is necessary to start your poultry farming. Once the infrastructure and equipment are in place, you don’t have to spend money on it again, providing that you do maintenance and take good care of it. You will however have to keep on buying chickens, feed, medicine, and sanitiser.
Eggs must be packaged for safetransport. (Source: Errol Ahmed, unsplash.com)
Buying chickens
Strong chickens are your most important investment. Find out what the purchase price of day-old chicks are, and if you don’t want to raise chickens, the price of pullets to raise as broilers and point-of-lay hens.
Chickens at a marketplace. (Source: Random Institute, unsplash.com)
Buying materials for infrastructure
Your infrastructure must last a long time. Find out the cost of the available materials at a shop, especially chicken wire, but also look around your yard or neighbourhood what materials you can find for cheap or even free. Think about installing a tank for storing water so you will never run out of water for your chickens to drink or to spray them to cool them down.
Security
To keep your chickens safe, your will have to put up a proper fence around
your property. The gate to the henhouse must also have a sturdy lock.
Equipment
You will need suitable equipment to feed and water your chickens, and to clean their houses. You will need drinkers, feeders, buckets, a wheelbarrow, pitchfork, spade, and a backpack sprayer.
Heating, cooling and ventilation
It is important to keep your chickens comfortable and not too hot or cold. Find out what energy for heating, cooling and ventilation will cost. This includes the heat of the sun, which is free unless you plan to use a solar heater, which is a once-off cost, electricity, gas, or paraffin. Remember that a solar heater does not work at night when you really need the heat, unless you can store the energy in a battery.
Feed
Feed will be your biggest expense. Find out where you can buy good quality feed at the best price. It is best to buy a premix that contains all the necessary ingredients for the chickens at every stage of their lives. Make sure you have a safe storage area where no damp, insects, birds, or rodents can reach it. Remember that you can never use wet or contaminated feed, as it will make your chickens sick.
There must be enough feeders for all the chickens to be able to reach the feed. (Source: Arisa Chatassa, unsplash.com)
Health
Vaccines and medicine are necessary expenses. Also find out what supplements your chickens need to grow strong and remain healthy. Some of the food you grow on your farm may be used to supplement their feed, such as vegetable greens. Layer hens that roam in a fenced-in yard will also supplement their feed by eating grubs and vegetable matter.
Indirect costs
Indirect costs refer to additional costs that you will incur while farming chickens. You need transport, not only for fetching building materials and feed, but also for delivering your chickens and eggs to your clients.
Keep in mind that eggs need to be carefully packaged for transport. Broilers must either be sold live, or be slaughtered by yourself or an abattoir, which will incur some costs.
These costs also include paying for water, electricity or other forms of energy, a telephone, rent, and the interest on a loan.
Different breeds of chickens are available. (Source: Pixabay)
Unforeseen costs
Unforeseen costs refer to costs that you will incur when things go wrong. Although you don’t want it to happen, there are some things that you don’t have any control over, no matter how careful you are.
These include disease control — if there is an outbreak of disease, it may be necessary to cull your entire farm, as it is required by law to help prevent the disease from spreading. That means that you will have to clean the houses properly and wait for a while before you can get new chickens, which will also cost money.
Sometimes feed gets wet, or rodents get into it, and then you will have to replace a whole batch, which can be costly.
You must also keep in mind that chickens that are nearing their marketing age, will always be a target for thieves. You may also get sick and need to hire someone to help care for the chickens.
Chickens need a sturdy henhouse that can ideally be moved around in the yard. (Source: Sincerely Media, unsplash.com)
Profit
Depending on how well you look after your chickens and do everything right, you will be able to show a profit once you start selling chickens for meat or eggs.
Here is a checklist for your convenience. Tick off everything you have investigated.
Preliminary budget
A) Direct costs
- Production cycle
□ Chicks
□ Broilers
□ Layers - Infrastructure
□ Brooder
□ Broiler house
□ Layer house - Equipment
□ Drinkers
□ Feeders
□ Buckets
□ Wheelbarrow
□ Backpack sprayer
□ Pitchfork and spade - Heating, cooling and ventilation
□ Electricity
□ Gas
□ Paraffin - Feed
□ Chicks
□ Broilers
□ Layers - Health
□ Vaccinations
□ Medicine
□ Supplements
□ Protective clothing
□ Sanitizing liquid
B) Indirect costs
□ Transport
□ Additional worker
□ Water
□ Electricity/other heating
□ Telephone
□ Rent
□ Interest on a loan
□ Egg packaging
□ Slaughter cost
C) Unforeseen costs
□ Disease control
□ Replacement of chickens
□ Replacement of feed
□ Rodent control
□ Theft
D) Monthly Income
□ Sale of broilers
□ Sale of eggs
□ Sale of old layers
□ Sale of manure
Your profit will be your monthly income, minus all the costs involved.
These chickens have just been moved from the brooder to pasture. (Source: Zoe Schaeffer, unsplash.com)
Because you do not have all the details yet, you will not be able to know exactly how much starting your business will cost. By the end of the series, you will have more information to enable you to calculate the costs. With a good budget and business plan, you may even be able to get a loan or other funding.
References
Cilliers, F. (2001) Small-scale broiler house combined. Agricultural Research Council Family poultry training course. Trainee’s Manual. SA Poultry http://www.sapoultry.co.za/pdf-training/Trainees-manual-poultry-course.pdf
Poultry Management Guide. (2009) Arbor Acres https://eu.aviagen.com/assets/Tech_Center/AA_Broiler/AA-broilerHandbook2018-EN.pdf
A financial business plan budget for a new beginner