Agribusiness Incubator Program Growing Hawaii

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Agribusiness Incubator ProgramGrowing Hawaiis
agriculture industry, one business at a time
Agricultural Education Workshop Agribusiness
Incubator Program

• University of Hawaii

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AIP Background

• Part of CTAHR/UH
• Created through a USDA/CSREES grant
• Helps agribusinesses grow by providing business
  consulting services
• Assisted over 100 agribusiness and organizations
  statewide
• Provide hands-on, intensive, and wide-ranging
  business consulting

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AIP is

• Who we are
• http//aip.hawaii.edu

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Who we help

• Statewide program
• Emerging agribusinesses
• Existing agribusinesses seeking the next level
• Preference to Native Hawaiians
• Willing and able participants

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How were helping

• Other Services including business startup
  assistance, identification and coordination of
  external resources, value-added product guidance,
  and contract review

• Strategic Plans
• Business Plans
• Marketing Plans
• Project Management
• Financial Systems Review
• Financial Analysis

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Core Services

• Strategic Plans
• Business Plans
• Marketing Plans
• Project Management
• Financial Systems

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Why Should You Care?

• Most agribusinesses in Hawaii do not perform
  sufficient business management. Those that do can
  eparate themselve from the pack
• Controversial? From our experience, the most
  successful agribusinesses are run by people who
  excel at business versus excel at production
• (caveat their production decisions are
  business-driven too)

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Selected Practices

• Provide an overview of some key business
  management tools and functions and their benefits

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Cost of Production (COP)

• Determine the total cost of producing what you
  sell. Not simply the direct costs! Validate by
• Units sold X cost per unit should total
  expenses
• or, Total Expenses / Units sold Cost per Unit
• Prioritize cost-cutting efforts
• Price your product appropriately
• Identify your most profitable products
• Know how much you have to sell to break even
• Lends itself to forecasting revenues and expenses

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Cash Flow Projections

• Determine best times to spend and invest
• Identify cash flow issues ahead of time
• Often a lack of cash, not sales, causes
  businesses to fail (or at least make suboptimal
  decisions)

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Accounting

• Track purchases for volume discounts and
  forecasting
• Track sales for seasonal, product/mix, and
  customer analysis
• Know who owes you and speed receipt of amounts
  owed
• Help avoid late fees and penalties
• Necessary for grants, loans, taxes, some
  insurance
• Provides you with INFORMATION to manage your
  business

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Marketing

• Get out of being a commodity be more in control
  of pricing and demand
• Expand customer base/markets
• What can you do (not just advertising) that will
  encourage customers to do business with you?
• Branding How else would customers know how to
  prefer your product
• Doesnt need to be creative, expensive, or
  complicated -- you just need to have an
  integrated plan and take consistent action!

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Making A Difference

• Our company owes its existence in large part
  to the dedicated efforts and expert advice
  bestowed upon us from the entire team at the
  Agribusiness Incubator Program.
• AIP has helped us to create two value-added
  products guided us throughout the entire process
  and has been active consultants in our journey to
  create a new business and value-added product
  lines
• Success stories
• How to become a client
• Cost (free part graduated )

• AIP has helped us come a long way helped us
  create a new company and given us the
  confidence to move forward with our new venture.
  
• The opportunity to have been selected as a
  client business to receive the type of counseling
  and support that I have received is a godsend
  The services provided by AIP will enable me to
  procure funding for my fledgling business

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AIP client metrics, averaged over the past three
years

• Average annual revenue change
• 64.4
• Average annual profit change 
• 315.7

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Becoming a Client

• Download application from http//aip.hawaii.edu
• Complete and return the application
• AIP will call to schedule a meeting (phone or
  onsite) to learn more
• AIP scores applications and accepts clients on a
  space-available basis
• Cost
• Free Strategic Plan (the first step)
• Graduated rate flat fees per project based on
  client income
• Cost should never be an obstacle!

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Other Local Resources

• College of Tropical Agriculture Human Resources
• www.ctahr.hawaii.edu/sustainag/NewFarmer/Links.asp
  
• Small Business Development Center
• www.hawaii-sbdc.org
• SCORE
• www.hawaiiscore.org
• Oahu RCD (classes)
• www.pacrimrcd.org/SectionIndex.asp?SectionID48
• Small Business Administration
• www.sba.gov/localresources/district/hi/index.html

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Contact Info

• Thank you
• Steven Chiang, Director
• Agribusiness Incubator Program
• University of Hawaii
• schiang_at_hawaii.edu
• [phone]
• Website http//aip.hawaii.edu