Micropropagation Enterprise

1
Micropropagation Enterprise

• Economic Considerations
• Market Analysis

2
Commercial Plant Tissue Culture Laboratory

• Independent
• Enterprise where the finished product is the
  tissue cultured plant in vitro
• Integrated
• Enterprise where marketing and nursery are
  integrated together

3
Independent Laboratory

• Determining Factors
• Finance
• Market
• Research and development
• Production management

4
Finance

• It is possible to start tissue culture work in
  the residential culture and then a few hundred
  plant can be produced with minimal initial cost
• To start business, it is most desirable to have
  an investors with an agriculture and/or
  biotechnological background
• Venture capital has the tendency to loose
  patience sooner
• Remember, only larger and well managed
  enterprises have a fair chance to survive

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Market

• Enterprise should have a substantial part of its
  production in cultivars that are demanded in
  large quantities at a reasonable price
• Media, sterilization procedures, transfer
  manipulation, planting density and growing
  chamber conditions need large scale testing
• Once a certain level of production is reached,
  and thus a competitive overall cost price,
  enterprise can start thinking about producing
  both less demanded cultivars and cultivars that
  are new to market

6
Market

• A long time relation between producers and
  customers based on profit and mutual trust is
  important
• Frequent discussions, visit to laboratory and
  thorough intercourse with receiving nurseries and
  even producers of the limited product often lead
  to improvements in procedures
• Presentation of a well known, traditional plant
  as a new product

7
Importance of Market Knowledge

• How are patent regulations?
• Which varieties are economically suitable for
  tissue culture?
• Which cultivars can replace another?
• Can tissue cultured plant open a larger market?

8
Research and Development

• Research is very important in enterprise
• Experimental development of both technical aspect
  (growth media, methods of manipulation, growth
  conditions) and aspect related to production
  planning and cost price calculation of a
  production system
• Tacking problem arising in the course of the
  production process
• It is necessary to stay well informed about new
  evolution by reading scientific or professional
  literature
• Formal and informal contact with researchers and
  colleagues on an international level are crucial

9
Production Management

• An appropriate system to produce a required
  number of identical plants at a given time at a
  competitive price
• The desired time of delivery
• Phenotypic fidelity
• The original material
• Multiplication with a minimum of variation
• A competitive price

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Minimum Variation

• Starting with fresh material from the original
  plant on a regular basis
• Safe stock on a zero branching medium or limited
  axillary branching
• Positive selection of samples in vivo
• Avoid indirect regeneration through callus or
  cell system

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Competitive Price

• High efficiency production system has to be
  established with large quantities produced
  diluting high investment and operating cost
• Expensive labor substituting technology
• Reduced cost for the same quantity of labor

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Price

• It is of great importance to know the production
  cost of a tissue cultured plant
• It is important to keep records of all media,
  labor and overhead costs makes it possible to
  calculate the price
• It is desirable to have simple formula not only
  to calculate the cost price for the actual
  production but also to make prediction

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General Structure
1. Labour 65
2. Media 7
3. Equipment laboratory cost 17
4. Other 11
The second most important cost is related to the
space needed to grow the plants
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Possibilities of lowering costs

• Labor
• Electricity
• Planting density

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Labor

• Good production management is needed to reach a
  high efficiency
• Time spent in preparing and sterilizing culture
  media can be diminished by preparing larger
  batches
• Incubation of the prepared media to allow
  eventual contamination to be reveal
• perform experimental inoculation of some shoot on
  a few container beforehand to verify the reaction
  before the whole batch is transferred
• Using disposable containers

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Electricity

• Two major constituents of electricity cost are
  lighting of the shelves in the culture room (60)
  and cooling the culture room (25)
• Install lamps that are produce for less heat
• Install lamps outside the shelves

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Planting density

• It can be very interesting to investigate whether
  more shoots can be grown in the same container,
  with the same amount of medium, while maintaining
  the same quality
• Raising the number of units per container and/or
  the number of shoots per clump
• If 10 less medium, means saving 10 on 7 of the
  total cost.
• Saving in labor for the preparation and
  transport of the medium

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Market Analyses

• Markets.
• The target marketing process.
• Market segmentation.
• Evaluating market segments.
• Selecting market segments.
• Market positioning.

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Markets

• MARKETS
• They consist of all the potential customers
  sharing a particular need or want, who are
  willing and able to engage in exchange to satisfy
  that need or want
• TARGET MARKET the group of customers (people or
  organizations) at whom a seller aims its
  marketing effort.

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Distinctive Markets

• ULTIMATE CONSUMER MARKET People who buy
  products for their personal, non-business use.
• BUSINESS MARKET An organization that buys goods
  or services to resell, use in its own business,
  or make other products.
• These markets behave differently!!

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Market Segmentation

• The process of dividing the total heterogeneous
  market for a product or service into several
  segments, each which tends to be homogeneous in
  all significant aspects.
• Market segmentation is a basis principle of
  marketing.

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Importance of Marketing

• Marketing is the heart of a nations economic
  system.
• Demand for industrial goods is derived from
  consumer purchases.
• Marketing is important to organizations and must
  be part of the corporate planning process.

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Marketing Planning

• Based on short and long-range organizational
  goals
• Begins and ends with the customer
• Interprets consumer needs and links the
  organization and its environment
• a critical part of the Business Plan

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Marketing Plan Outline

• Executive Summary
• Environmental Analysis
• Strengths and Weaknesses
• Opportunities and Threats
• Marketing Objectives
• Marketing Strategies
• Marketing Implementation
• Evaluation and Control

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Executive Summary

• A synopsis of the plan
• Includes an introduction, explanation of key
  points, statement of costs
• Very important and useful as it is often given to
  people outside the organization

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Environmental Analysis
A comprehensive analysis of the company and the
environment relevant to the target market and
the competitive situation

• Most difficult part of the plan
• Requires information from the internal and
  external environment
• Accomplished through secondary and primary
  research
• Must have an ongoing way to collect and organize
  environmental data
• Marketing Information System is critical

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Environmental Analysis

• It must consider
• External Macro-environment
• Internal Factors
• Target Market
• Firms current marketing objectives and
  performance
• SWOT analysis

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Strengths and Weaknesses

• come from inside the company and only exist when
  the company exists
• must be analyzed relative to market needs and
  competition
• helps to determine what you do well and what
  needs to be changed to meet the needs of the
  firms target market

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Opportunities and Threats

• focus on factors external to the organization
• both opportunities and threats exist
  independently of the organization but greatly
  affect operation
• must differentiate OT from SW

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Opportunities and Threats

• opportunities are favorable conditions in the
  environment that could produce rewards for the
  organization if acted upon properly
• threats are conditions or barriers that may
  prevent the firm from reaching its objectives
• OT stem from many sources in the environment

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Marketing Objectives

• state what is to be accomplished through
  marketing activities
• should come out of the SWOT analysis
• need sales volume, market share and profitability
  objectives
• need objectives that specify the behavior you
  want from the target market
• need objectives stated in each marketing mix area
• product introduction, product improvement or
  innovation
• pricing, distribution and communication

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Marketing Objectives

• It should be
• expressed in clear simple terms
• written, so it can be measured accurately
• for a specific period of time
• consistent with the organizations corporate
  strategy

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Marketing Strategies

• must outline how the organization will manage its
  relationships with customers so that it gains an
  advantage over the competition

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Elements in Marketing Strategy

• Product
• Communications
• Price
• Distribution
• Service

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Step in Marketing strategy

• Market segmentation
• 1. Identify bases for segmenting the market.
• 2. Develop profiles of resulting segments.
• Market targeting
• 3. Develop measures of segment attractiveness.
• 4. Select the target segment(s).
• Market positioning
• 5. Develop positioning for each target segment.
• 6. Develop marketing mix for each target segment.

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Market Segmentation

• The process of dividing a market into distinct
  groups of buyers who might require separate
  products and/or marketing mixes.
• 1. Geographic segmentation (geographic units).
• 2. Demographic segmentation (demographic
  characteristics).
• 3. Psychographic segmentation (social class,
  life-style, or personality characteristics).
• 4. Behavior segmentation (knowledge, attitude,
  use, or responses to a service).

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Requirements for Effective Market Segmentation

• 1. Measurability degree to which a segments
  size and purchasing power can be measured.
• 2. Accessibility degree to which a segment can
  be accessed and served.
• 3. Substantiality degree to which a segment is
  large or profitable enough.
• 4. Actionability degree to which programs can be
  designed to attract and serve the segment.

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Evaluating Market Segments

• Segment size and growth current segment sales,
  growth rates, and expected profitability.
• Segment structural attractiveness presence of
  many strong and aggressive competitors, relative
  power of buyers, presence of powerful suppliers.
• Organizations objectives and resources do not
  mesh with organizations objectives or
  philosophies.

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Market Targeting

• Selecting Market Segments
• Market Coverage Strategy Alternatives
• 1. Undifferentiated marketing strategy ignore
  market segmentation, go after whole market with
  one service offer.
• 2. Differentiated marketing strategy target
  several market segments and design specific
  service offers for each one.
• 3. Concentrated marketing strategy try to get a
  large share of one or more small market segments.

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Market Targeting

• Choosing a Market Coverage Strategy
• 1. Company resources the less the companys
  resources, the more likely a concentrated
  strategy is the best option.
• 2. Product homogeneity the greater the
  differences in the services, the better it is to
  use either differentiated or concentrated.
• 3. Market homogeneity the greater the
  homogeneity in customers, the better it is to use
  undifferentiated.
• 4. Competitors strategies it may be wise to use
  the same strategy or a different one.

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Market Positioning

• The way organization services are defined by
  consumers on important attributes. The place
  these services occupy in consumers minds
  relative to competitors services.
• Positioning Strategies
• 1. Specific attributes of the services.
• 2. The need the services fill or the benefits
  they offer.
• 3. For certain groups or classes of customers.
• 4. Against an existing competitor or competitors.
• 5. Against another product class.

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• Choosing and Implementing a Positioning Strategy
• Three Steps in Positioning
• 1. Identify a set of possible competitive
  advantages.
• 2. Select the right competitive advantages.
• 3. Communicate and deliver the selected position
  to people in the selected target market.