MANDEM

Outline Business Plan

1
 Mandem BP Outline

Table of Contents
1 Executive Summary............................................................................................................................5
2 Market Overview................................................................................................................................6
2.1 Uganda Macroeconomic.............................................................................................................6
2.2 Kenya Macroeconomic performance.........................................................................................8
2.3 Tanzania Macroeconomic performance...................................................................................10
2.4 Agricultural Sector....................................................................................................................11
2.5 Grain Sub-Sector.......................................................................................................................11
2.5.1 Legal & Regulatory Regime...............................................................................................11
2.6 Overview of Market..................................................................................................................11
2.6.1 Value Chain Analysis..........................................................................................................11
2.6.2 Market Segmentation in Uganda......................................................................................11
2.6.3 Regional Market < Kenya, South Sudan and Congo>........................................................12
2.6.4 Competitor Analysis..........................................................................................................12
3 Mandem Go-to-Market Strategy......................................................................................................13
3.1 Overview...................................................................................................................................13
3.2 Target market...........................................................................................................................13
3.2.1 Overview...........................................................................................................................13
3.2.2 Maize Market....................................................................................................................13
3.2.3 Beans Market....................................................................................................................13
3.2.4 Buyers................................................................................................................................13
3.3 Infrastructure Requirements....................................................................................................13
4 Organizational Overview..................................................................................................................15
4.1 Ownership.................................................................................................................................15
4.2 Organizational Structure..........................................................................................................15
4.3 Key Team Profiles.....................................................................................................................15
4.4 Operational & Staffing plan......................................................................................................15
5 Financial Projections.........................................................................................................................16
5.1 Key Financial Requirements.....................................................................................................16
5.1.1 Opex Budget......................................................................................................................16
 Mandem BP Outline

5.1.2 CAPEX Budget....................................................................................................................16

5.2 Financial Projections.................................................................................................................16
5.2.1 Key Assumptions...............................................................................................................16
5.2.2 Base Case...........................................................................................................................16
5.2.3 Scenario Testing................................................................................................................16
6 Appendices.......................................................................................................................................17
 Mandem BP Outline

Abbreviations
<to insert>
 Mandem BP Outline

1 Executive Summary
<<To complete at the End>>
 Mandem BP Outline

2 Market Overview
2.1 Uganda Macroeconomic
Uganda’s economy is projected to grow by 6.2% this financial year 2020/21. The economic outlook
for 2021 is very positive thanks to a recovery in the agriculture sector, the sustained growth in
services, and the continued huge investment by the government into public infrastructure.
According to Uganda Bureau of Statistics’ (UBOS) latest data, the economy grew by 6.4% year on year
in the first quarter of FY20/21, continuing with the same momentum from the last quarter of
FY19/20. This was a major improvement from the 4.5% growth that was realized in the first quarter of
FY19/20. The Government is now projecting the economy to grow by 6.2% in the FY2020/21. This
prediction is contained in the National Budget Framework Paper 2020/21 (BFP) published by the
Ministry of Finance in December 2020.
The projected growth will be driven mainly by the continued recovery in the agriculture sector. The
agriculture sector largely benefiting from favorable weather conditions, is currently the major driver
of economic growth having recorded a 1.2% growth in the second quarter of FY20/21, up from the
0.6% growth registered in the first quarter. This recovery in the agricultural sector and the associated
exports has given a major boost to the economy.

The Medium-term growth of the economy is also very positive. The government is projecting the
economy to grow by 6.2% in the next financial year 2019/20, with agriculture, industry and services
projected to grow at 3.8%, 5.6% and 7.8% respectively. Domestic demand supported by healthy
 Mandem BP Outline

private sector credit (PSC), as well as investments in public infrastructure together with Foreign Direct
Investment (FDI) inflows are also expected to drive growth of the economy in FY19/20.
This positive outlook assumes continued good weather conditions, robust external demand, increase
in FDI inflows as oil exports draw closer, and public infrastructure spending is properly executed as
planned.
At the moment, most macroeconomic fundamentals in the country remain positive. For example,
foreign exchange reserves are adequate currently at 5.3 months of import cover; consumer price
inflation is comfortably below the BoU’s medium term target of 5.0%; and public debt though
increasing, is still considered sustainable.
Over the next two years, massive investments in infrastructure development related to the oil and
gas sector and the related expected increase in FDI inflows have the potential to drive Uganda’s
economic growth to 7.0% or more.

In the last six months (first half of FY18/19), annual headline and core inflation averaged 3.0% and
3.4% respectively.
The low inflation recorded during the period was mainly due to the relatively stable exchange rate
and favorable weather conditions, which resulted in an increase in food supplies. On this account,
annual inflation remains within BoU’s medium term target rate of 5.0%.
Annual headline inflation is projected to rise to 5.1% mainly on account of increasing oil prices and
increase in domestic demand following a rebound in economic growth. However, in FY19/20 and the
medium term, headline inflation is projected to remain stable within single digits and core inflation
remaining close to BoU’s policy target rate of 5.0%.
The country’s macroeconomic policy stance remains focused on containing inflationary pressures,
enhancing exchange rate stability, and stepping up domestic resource mobilization growth by 0.5%
points of GDP per annum.

The Shilling has remained relatively stable despite external pressures. After a record low of UShs
3,897 to the USD, back in September 2018, the Shilling has recovered, and even appreciated since
then. This slight appreciation of the shilling is on account of increased dollar inflows mainly from
coffee export receipts, off shore portfolio investors and private transfers. The Shilling is projected to
 Mandem BP Outline

remain stable for the remainder of FY18/19 and probably even appreciate in the medium to long run,
as a result of
increased dollar inflows from exports, remittances, FDI and tourism; as well as the commencement of
oil production.
Despite this optimism, the shilling remains susceptible to external shocks. It is therefore possible that
we could see further sharp depreciations of the shilling due to the stronger than expected US dollar
as well as the continuing global trade policy, uncertainty emanating from escalating trade tensions,
tightening global financial conditions and rising geo-political risks.
A continuation of the weak current account position resulting from the higher import growth may
also result in a depreciation of the shilling. Any renewed exchange rate volatility of the shilling will be
bad news for the economy and inflation in particular, as it could further weigh down on consumer
demand by raising prices for imported consumer goods.

2.2 Agricultural Sector

 High-Level Overview of the Sector
 Key Crops
 Opportunities & Challenges

2.3 Grain Sub-Sector

This will cover the following key areas:
2.3.1 Legal & Regulatory Regime
 Regulation & Legal Issues
o Key oversight bodies to the business
 UNBS
 Uganda Warehouse Receipt systems authority
 Mandem BP Outline

 URA
 NSSF
 Ministry of Agriculture
 Ministry of Trade
 Local Town Councils
 PPDA
o Regulatory reporting requirements (inspections, reports)
 URA
 NSSF
 UNBS
2.4 Overview of Market
2.4.1 Value Chain Analysis
o Production
 Post Harvest Management
o Trade ( Local & Regional)
o Logistics
o Processing
o Marketing & Distribution

2.4.2 Market Segmentation in Uganda

o Wholesale
 INGOs
 Government
 Traders/Brokers
 Schools
 Prisons
 Army
 Police
o Retail
 Shops
 Supermarkets
o Key questions for each segment.
 Sourcing
 Payment Terms
 Logistics
 Seasonality

2.4.3 Regional Market < Kenya, South Sudan and Congo>

o Wholesale
o Retail
o Key questions for each segment.
 Sourcing
 Payment Terms
 Mandem BP Outline

 Logistics
 Seasonality ( Peaks & Troughs)

2.4.4 Competitor Analysis

o Key Competitors in the Market
 Aponye, Mandela Millers, Pan Afric Impex, Savannah Commodities
o Mapping of competitors
 Mubende, Kampala, Kamwenge, Kawempe,Mukono
o Understanding competitor facilities & infrastructure
 Advanced facilities and infrastructure: processing and storage: driers,
sorter, silos
 Supply and demand networks already established
o Understanding competitor integration with other parts of value chain ( Are they in
production? Are they in retail? Etc
 Aponye – retail, logistics, milling
 Mandela – retail, logistics, milling
 Garuga – retail, milling
 The rest are only processing
 Mandem BP Outline

3 Mandem Go-to-Market Strategy

3.1 Overview
 The vision of the Company: Short term, medium term & Long term
 Short term – trading & processing
 Medium-term - processing and trading
 Long term – include a farm to provide 40% of our product, milling
 Scope of business? List the goods to be traded and services to be provided.
 Agro-processing – service provided
 Maize and beans – goods
 Coffee high-value crop (medium-term)

3.2 Target market

3.2.1 Overview
 Identify Key Crops company will target

3.2.2 Maize Market

 Sizing of the Maize market and estimation of Mandem growth in market share over the projection
period.
 Current Pricing of Service/ product in this market segments
 How Mandem will target this market? Strategy

3.2.3 Beans Market

 Sizing of the Beans Market and estimation of the Mandem growth in market share over the projection
period.
 Current Pricing of Service/ product in this market segments
 How Mandem will target this market? Strategy

3.2.4 Buyers
 Who are the key buyers? (retail/wholesale)\
o World Food Programme
o Governments
o Export market (China)
 What is their pricing power i.e how much say do they have on pricing?
o Minimal
3.3 Infrastructure Requirements
 Location
 Kyenjojo (potential)
 Kyankwanzi (potential)
 Infrastructure & Equipment Requirements
 Silos
 Warehouse
 Cleaner
 Drier
 Weigh-bridge
 Generator
 Mandem BP Outline

 Mill
 Diesel storage/ energy source/ bio gas
 Hurler - coffee
 Roaster - coffee
 Mandem BP Outline

4 Organizational Overview
4.1 Ownership
This section will have the company’s current key shareholders and their profiles

4.2 Organizational Structure

This will cover the structure of the whole organization.
 We shall have a governance section that will speak to the composition of the board its committees etc.
 There will be section on the organization structure covering key departments, their roles and key
executives and staff

4.3 Key Team Profiles

 BN.
 BB.
 IB

4.4 Operational & Staffing plan

This section how the organization will be setup i.e the key departments that will be prioritized during
establishment and subsequent roll-out and augmentation of the staff in the organization. This section
will also cover how the staffing will grow over time in line with the growth of the company the next 5
years. This can be broken won per departments
 Mandem BP Outline

5 Financial Projections
5.1 Key Financial Requirements
5.1.1 Opex Budget
5.1.2 CAPEX Budget
5.2 Financial Projections
5.2.1 Key Assumptions
5.2.2 Base Case
5.2.3 Scenario Testing
 Mandem BP Outline

6 Appendices
a. Full Base Case Financials