Rural Development Advocates Training Module Center (RDA-TMC)

Feasibility Study

2009-03-12T09:10:00.000-07:00

How to draw up a BUSINESS PLAN

2009-02-24T21:26:00.000-08:00

Prepared by: Ramon A. Kahulugan

Two different concepts

Business Planning - the process you undertake to develop, plan and review your business on an ongoing basis.
Business Plan - a document you may draw up for a specific purpose at a specific point in time.

Reasons for drawing up a business plan might include:

You want to review your initial business plan.
You want to use a business plan to explain your business concept to a potential partner.
You want to convince a financial institution that lending your business money will be a good investment for them.

Parts of business Plan

1. Summary
2. Marketing Plan

Products
Location
Target market
Price of product
Sales projection
Promotion and marketing strategy
Marketing cost allocation

3. Production Plan

Production process
Plant, building, equipment, cost
Plant production and storage facility
Raw materials supply and cost
Labor requirement
Factory overhead

4. Organization and management plan

Structure
Administration and personnel
Pre-operating activities
Ofiice fixed assets, equipment, fixtures
Admin cost

5. Finance plan and analysis

Plant installation and operation capital outlay
Business office capital outlay
Product manufacturing cost
Admin operation cost
Pre-operating cost
Capital outlay summary
Income statement projection
Cash position after each year
Financial viability

6. Business Process Planning overview

The Business Process Planning model works like this:

Market Research: Research your markets.
Competitive Advantage: Identify your Competitive Advantage.
Unique Selling Proposition: Develop your Unique Selling Proposition.
Critical Success Factors: Develop Critical Success Factors to achieve your Competitive Advantage.

Key Activities: Develop your Key Activities to focus your actions.
Action Plan: Identify Tasks, develop an Action Plan and check how you're going.
Analyse and check: Prepare cash flows, profit and loss reports, budgets, benchmark reports etc, analyse them and check you're going to plan..

Advocacy and Mass Campaign Administration (AMCAD)

2009-02-22T23:16:00.000-08:00

Topics Outline:

1. ADVOCACY

definition of advocacy
objectives of advocacy ( anticipated advocacy outcomes)
advocacy agenda
Targets of advocacy
Forrms of advocacy ( internal and external)
Advocacy mindset ( 3 myths and 3 truths)

Definition

The word advocacy originated from the Latin word “advocare” which means to argue

• Advocate (verb)
- seek favor for something
- give/seek support through argument
- provide general recommendation

Advocate (noun)
- one who summons, seeks supports, mediates, debates and defends for the welfare of the majority

1. Meaning of Advocacy- an act or process of pleading a cause

Deliberate and strategic use of information to influence decision-making;
Strategic action to initiate a public policy beneficial to the community or to block one expected to be harmful;
The act or process to demand, defend or maintain a cause before a body of authority which includes among others the executive, legislative and judicial branches of government.

Policy Advocacy – a strategic political action of a community or group of people arising from the need to address a particular issue through influencing policy or the way it is implemented.

Public Advocacy – actions to influence the mind of general public from the need to address a particular issue and in effect organizing and mobilizing them for a specific action.

part of the developmental action:
As an element of an organizational work:
Advocacy and Community Organizing (CO
Advocacy and people’s empowerment:

Role of an Advocate

An advocate, on the other hand, is a person who does the advocacy work. Their role is to represent the client group’s interest. This is done through efforts to influence the individual or groups who control the situation with which the client is concerned.

Practice a Powerful Advocacy Mindset

As advocates, you are the initiators of action.

This mindset is the simplest and most powerful means for navigating among options when planning your advocacy strategy. As advocates, it is your agency that matters: choose the strategies that promote and preserve that agency.

Advocacy strategy can focus on shaping WHAT policy is - establishing a law, a policy, a decree, or some other kind of societal rule. Advocacy strategy can also focus on HOW policy happens - opening up the process by which such societal rules are made and kept.

But advocacy strategy works in the most powerful and lasting ways when it also centers on WHO makes policy happen - facilitating a process by which people know the power they themselves have in making and keeping societal rules.

This orientation towards initiative acts as your compass on your advocacy journey. No matter the twists and turns of the road, the needle keeps its orientation, allowing you to navigate in any needed direction.

People-Centered Advocacy

A social justice advocacy organization needs to work to stay connected with and accountable to the people whose interests it serves. A people-centered campaign produces not only change, but engaged community members who work to keep change going, and to implement other changes.

To make sure that your organization maintains significant relationships with its members, constituents, or those in affected groups, continuously ask yourself three questions:

Are we giving voice to people whose voices are not fully heard?
Are we enabling and motivating people to become actively involved in the advocacy process?
Are we taking time to learn from the experiences of our members, constituents, or those in affected groups?

People-centered advocacy not only helps amplify the voices that are seldom heard, but also begins to transform existing power dynamics that determine who can be an "advocate" in the first place.

2. Advocacy issues

* Definition of issue
* Issues life cycle Stage
* Checklist for choosing problems and issues

CHECKLIST FOR CHOOSING A PROBLEM AND ISSUE

To compare issues and choose the best focus for your campaign, either use this checklist of criteria or develop your own. List the issues under consideration in the columns, and go down the list of questions, recording a “1” for every “yes” answer and a “0” for every “no” answer. Problems/issues with higher scores have the potential for multiple positive results.

TRIANGULAR ANALYSIS

Problem/Issue 1:	Problem/Issue 2:	Problem/Issue 3:	Will resolving the problem/ Will the issue:
			1. Result in a real improvement in people’s lives?
			2. Give people a sense of their own power?
			3. Build strong lasting organizations and alter the relations of power?
			4. Raise awareness about power relations and democratic rights?
			5. Be winnable?
			6. Be widely felt?
			7. Be deeply felt?
			8. Be easy to communication and understand?
			9. Provide opportunities for people to learn about and be involved in policies?
			10. Have clear advocacy targets?
			11. Have a clear time frame?
			12. Be non-divisive among your potential constituency?
			13. Build accountable leadership?
			14. Be consistent with your values and vision?
			15. Provide potential for raising funds?
			16. Link local issues to global issues and macro policy context?

Adapted from A New Weave of Power, People, and Politics: The Action Guide for Advocacy and Citizen Participation by Lisa VeneKlasen with Valerie Miller, and from Organizing for Social Change: A Manual for Activists in the 1990s by Kim Bobo, Jackie Kendall, and Steve Max.

TRIANGULAR ANALYSIS

Political solutions to problems often take more than just law or policy reform. There are many examples from different countries where laws changed, while the people did not. Laws are a critical part of public policy because they regulate work and social relations, and access to economic resources, opportunities and political power. Laws and policies, however, can be unjust in three ways: content (the written law or policy may be discriminatory or inadequate in today’s context); application (policies may not be implemented or at least not as envisioned; laws may not be enforced, or enforced in a prejudicial way); and culture (if citizens are unaware of policies, the laws or their rights, or if social attitudes run contrary to the substance of the law or policy, even a just law or policy cannot benefit people in practice).

When selecting an advocacy issue, you need to identify where the change needs to occur – at the level of policy, at the implementation level, or in the culture and behavior of the people themselves. This is known as triangular analysis.

Questions to guide triangular analysis

Is a new or improved law or policy needed?
Is the existing policy or law being implemented or enforced adequately?
Do people know the law and believe that they have rights in order to pursue solutions or make demands on the system?

APPLICATION refers to the process and institutions of the state that implement and enforce law and policy such as courts, police, ministries, schools, etc.

CULTURE refers to shared values, attitudes and behavior, level of awareness about law and government, sense of rights

CONTENT refers to the constitution, written laws & policies, budgets

3. Media Work and Advocacy

important influencer
conduit for information with your audiences
looking for “interesting and news-worthy” stories (real people, celebrity,scandal, danger, sex, relevance to their medium)
different kinds of media people/outlet ( radio- sounds, print- news releases, tv and photo – graphics, events)
dealing with the media
crafting a media campaign plan

Dealing With The Media

Whether you like it or not, the media matters. If your campaign generates any level of interest and develops a profile, you will have no choice whether to deal with the media. Your choice will be how, not whether, to deal with the media.

For campaigns, the media can provide an important conduit for information with your audiences. Even local radio and newspapers reach hundreds of thousands of people with a directness, objectivity, and immediacy which no campaign could ever match.

If your campaign is battling for public opinion, then the media is the most important influencer.

Journalists need information in a format they understand - which is why organisations use the News Release format as one way of promoting their stories. They need information which they can use - which is why you should always try to make your stories interesting and news-worthy. 'News-worthy' is fairly subjective, but journalists are on the look out for the following:

Stories about real people, not organisations
Unusualness or oddity
Celebrity
Scandal
Danger
Sex
Relevance to their medium

Radio journalists don't want photo-opportunities, they want sound. Local journalists want events on their patch, not in the town down the road.

The basic techniques of media relations are:

News Releases
Features and articles
Letters to the editor
Photo-opportunities
Interviews

News releases are a way of attracting a journalist's attention and getting them to phone you up for more information. They should contain your organisation's name and address, a 24-hour contact phone number, and the words 'News Release' at the top.

If you 'embargo' your news release, the journalist cannot print or broadcast the material it contains before the stated time and date.
If you write 'for immediate release' the journalist can use it straight away.
Your news release must contain news - a story which the journalist can use - and pack the facts into the first paragraph. Follow the 5W formula (who, what, where, when and why).
Double space your news release, use one side only, and don't go beyond two sides of A4. Write 'more follows' if going on to a second page, and 'ends' at the end.
Target your news release at the right person - news rooms receive thousands every day, and most go straight into the waste bin.

Features and articles can cover your campaign and keep you in peoples' minds. You can pen these yourself or approach a journalist with background material and story ideas.

* Read the publication you are targeting and try to match the house writing style.

Letters to the Editor should be short and sharp and pertain to a story in the publication. Write 'For Publication' and include a phone number.

A photo is worth more than a thousand words - try to dream up interesting photo-opportunities for local or national newspapers, or commission your own photos and send them out to publications.

If giving interviews to broadcasters, decide what you want to say first and don't be distracted by the interviewers questioning. Stay on message, and repeat yourself if necessary.

Find out whether the interview is live or pre-recorded, and who else is appearing with you. Arrange the travel details and any appearance fee in advance.

Keep contact details of journalists you have dealt with, and keep them informed about the campaign's progress.

If your opponents are quoted or have an article placed - rebut it with your side of the argument as fast as possible. Don't let your opponents get away with a free ride.

If you get unfair coverage, or you are misquoted, you have the right to complain first to the editor, and then to the Press Complaints Commission. Complaining about bad journalism is the way to secure good journalism.

4. Alliance and Coalition building

Definition
Needs of alliance and coalition
Formation of coalition
Managing a coalition
two kinds of collaboration - “unity and diversity” and “confrontation and dialogue”

TIPS FOR MAKING A COALITION WORK

Coalitions expand the numbers and expertise of those working on an issue; they can unite unlikely allies and bridge essential gaps. When effective, coalitions mass and focus the collective skills, resources, and energies of their constituents. When ineffective, they can drain energy and resources, exacerbate institutional and personal rivalries and conflicts, paralyze flexibility, and deaden initiative.
There are several basic rules that can make coalitions more effective and help avoid the greatest dangers. Use these rules to supplement the constant “care and feeding” of coalition members, which must remain a high priority.

State clearly what you have in common, and what you don’t.The goals and objectives of the coalition must be clearly stated, so that organizations that join will fully comprehend the nature of their commitment. At the same time, coalition members must openly acknowledge their potentially differing self-interest. By recognizing these differences, coalition leaders can promote trust and respect among the members, while stressing common values and vision.
Let the membership and the issue suggest the coalition’s structure and style.Coalitions can be formal or informal, tightly organized or loose and decentralized. The type of coalition chosen will depend on the kind of issue as well as the styles of the people and organizations involved. Coalitions evolve naturally, and should not be forced to fit into any one style.
Reach out for a membership that is diverse – but certain.Coalitions should reach out for broad membership, but not include those who are uncertain or uncommitted to the coalition’s goals or strategies. The most effective coalitions are composed of a solid core of fully committed organizations, which can draw together shifting groups of allies for discrete projects or campaigns. Overreaching for members can result in paralysis and suspicion. There’s nothing worse than a strategy planning session where coalition members are eyeing each other suspiciously, instead of openly sharing ideas and plans.
Choose interim objectives very strategically.Interim objectives should be significant enough for people to want to be involved, but manageable enough so that there is a reasonable expectation of results. They should have the potential to involve a broad coalition and be of sufficient interest to gain public and media attention. Interim objectives should be chosen so they build relationships and lead toward work on other, more encompassing objectives.
Stay open to partnerships outside the formal coalition structure.A coalition must be able to work with a great diversity of advocacy groups, but all groups need not belong as formal members. Organizations whose goals are more radical, or whose tactics are more extreme, are often more comfortable and effective working outside the formal coalition structure and informally coordinating their activities.
Take care of the coalition itself.At the heart of every successful coalition, there should be a small directorship of leaders who are deeply committed not only to the issue, but also to the coalition itself, and to the importance of subordinating the narrow interest of their individual organizations to the overall goals of the cause.
Maintain strong ties from the top to major organizations.The coalition’s leaders must also have strong ties to the major organizations and their leaders must be strong. This commitment must be communicated within the organization, so that its staff members clearly understand that coalition work is a high priority.
Make fair, clear agreements and stick to them.Coalition tasks and responsibilities should be clearly defined and assignments equitably apportioned. If a member is falling down on the job, that should be dealt with promptly. Meetings should allow opportunities for members to report on their progress.

5. Crafting Campaign Plan and Adminstration

definition of campaign
Campaign Planning and preparation

Campaign Planning and Preparation

The essential component of a campaign is a plan.

Without it, your campaign will lack focus, squander resources, burn out your activists, and suffer from what the military call 'mission drift'. A plan helps target your resources, ensures that all your volunteers are pulling in the same direction, gives a shared understanding of what you are attempting to achieve, and gives you a compass by which to steer your activities. Advance planning and preparation can save valuable time and money as the campaign develops.

Your plan should be flexible, and allow for unforeseen developments and opportunities. The best campaigns are those which can quickly react to events and turn the unexpected to their advantage. Your strategy should be soundly worked out, but your tactics should be flexible and adaptable.

The elements of your campaign plan should include:

Overall strategic objective
Tactical targets
Your key messages
Target audiences
Methods of delivery
Timing
Evaluation of success

In other words:

What you want to achieve
What the steps are along the way to achieving it
What you want to say
Who you want to say it to
How you want to say it
When and for how long you want to say it
And how you know if you've been successful

It is worth looking at each of these elements in some detail:-

Overall Strategic Objective

This is your final goal - the target which unites your supporters, spurs on your activists, gives your campaign its 'personality' to the outside world, and which provides the yardstick against which all your activities should be measured.

It might be a grand objective, such as the global disarmament of nuclear weapons, or a localised one such as preventing the closure of a local branch of a high-street bank. If you choose the grand objective, you should ensure that your tactical targets are realistic and achievable.

You may be able to attract support for visionary objectives, but without immediate targets which can be achieved quickly, your supporters will soon evaporate. Like Monty Python's Popular Front of Judea, if your campaign objective is akin to 'the dismantling of the Roman Empire by Wednesday week', you will lack credibility.

The overall strategic objective might become part of your campaign's written communications. You might want to codify it into a snappy 'mission statement' or statement of aims, so that everyone clearly understands what you want to achieve.

Without such shared understanding, you will find that your volunteers and activists are working to different agendas, and that you public profile will be confused with your target audiences. The overall objective reflects your campaign's values and provides the answer to the question 'what is your campaign for?'

Tactical Targets

To give a campaign vibrancy and life, you should aim for some tactical targets which can unite your supporters and give your campaign direction and focus.

In business jargon this is known as going for 'the low-hanging fruit' or gaining 'quick wins'. It means that the morale of your campaigners is given a boost by small but significant victories, and you gain profile and enhanced reputation.

Examples might include achieving a target for fundraising, or for a mailout or leaflet drop, or securing a key pledge of support from a politician, or winning a goal which puts you on the way to your overall objective.

Your Key Messages

Your key messages are what you want to say. These should be short, snappy and memorable, and devised to engender as widespread an understanding as possible. They should avoid all jargon or rhetoric, and be written in everyday language. You might want to show them to a twelve-year old to see if they pass the comprehension test.

Your audiences, even those directly effected by your campaign, have little time for lengthy documents, manifestos or lists of demands. Your key messages must be short and understandable to busy people with many other distractions and competing influences. Your campaign may be the most important thing in the lives of your activists, but for the rest of the population the same is not true.

These key messages can be boiled down into 'soundbites' for use in the media. Just as Lenin condensed the whole of his political theory into the soundbite 'Bread, Peace, and Land' or campaigners in the 1980s struggled for 'Jobs not Bombs' or 'Coal not Dole', so you should aim to create a campaign lexicon which is equally concise and robust.

Repetition is essential, throughout all your literature, interviews and speeches, so that the message is reinforced through all forms of communication. In politics this is called 'Staying On Message'. If you find yourself repeating the same messages for the thousandth time, console yourself with the thought that someone, somewhere is hearing them for the very first time.

Target Audiences

To be successful, you must decide who your campaign is aimed at. Your audiences will fall into several categories, and each will need a different style of approach, and for different purposes. Your activists need to hear different messages and be treated differently from sponsors, or journalists or politicians. The people taking the decisions which will determine your campaign's success or failure might number only a handful, and possibly even one, but the numbers of people who influence the decision-makers might number thousands or millions. A consumer boycott involving millions of people across Western Europe might be aimed ultimately at a company Board of just ten people.

Your audiences might include:-

Activists
Supporters
Potential supporters
Opponents
The media
Third-parties
Politicians
'Influencers'
Deciders'

Each of these groups should be carefully researched and their views and motivations clearly understood.

Some of your target audiences are the decision-makers who can influence the outcome of your campaign, others are the influencers whose views the deciders listen to. Other audiences will be the media, who will help you reach deciders, or third-parties with whom you can make common cause.

It is even worth communicating with your opponents, because their opposition might be based on misconception or inaccurate information about your campaign.

Accuracy is vital - be sure to spell names correctly, get peoples' titles right, and ensure that you are writing to the right person, not the person who left the job three years ago.

Methods Of Delivery

How you communicate is as important as what you communicate. The methods of delivery you chose will depend on your budget, your campaign's style and approach, and the size and place of your audiences.

Most forms of mass communications are prohibitively expensive - television and newspaper advertising costs tens of millions of pounds. That is why most campaigns, run on limited resources, depend on imaginative techniques for 'low-cost/no-cost' communications which allow you to punch above your weight.

Successful campaigns have been pitched against global companies or even countries and won, despite being massively out-resourced by their enemies. The methods of communication must be appropriate to the audiences you seek to reach. Language and graphics must be accessible to all, including people with disabilities or people without English as a first language.

But you should also be aware that certain forms of communication are ineffective with certain groups. For example Cabinet Ministers are virtually immune to being shouted at by demonstrators - that comes with the job - but will listen to a well-made argument soberly put.

Traditional forms of communication such as leaflets are poor ways to reach people - in urban areas letter boxes are stuffed with mountains of unsolicited material advertising pizza, minicabs, decorators and so on, so your campaign leaflet might be fighting for attention alongside a great deal of competition. People are becoming immunised to 'junk mail' and now junk e-mail, or 'spam.'

Public meetings are usually poorly attended. The old-style campaign is in danger of extinction - and those which prosper will be those which use imagination, lively attention-grabbing methods and the latest technology.

Low-resource campaigns may use the techniques of 'guerrilla marketing' to promote their cause.

These might include fly-posting, attaching stickers and posters to 'street furniture' like lamp-posts and at zebra crossings, or by using graffiti to change the meaning of other's poster ads. Anti-smoking campaigns, or campaigns against cars have used these techniques to great effect. You should be aware that you may be committing a criminal offence if you engage in this style of activity.

The campaign toolkit includes:

Media relations
On-line communications
Advertising
Direct mail
Stunts
Public meetings
Street activity
Demonstrations, marches and pickets
Lobbying and briefings
Leaflets and posters
Guerrilla marketing
Direct action

Part of your planning must include consideration of what kind of techniques you chose to communicate with, and the appropriate balance between different techniques.

Timing

Campaigns need a beginning, middle and end. A launch event affords the opportunity for media activity and a spurt of campaigning work. You might decide that your campaign will keep going until your objectives have been met.

If so, you need to identify phases of campaigning, and campaigns within your campaign to keep people interested and involved. Some campaigns give themselves a deadline, such as the Jubilee 2000 campaign. It is important for your volunteers and sponsors, as well as your target audiences, to know when your campaign intends to start and finish.

The calendar is a guide to activity. For example, August and late December/early January are bad times for calling demonstrations, public meetings or organising a petition because people are on holiday or off work for the festive season, but these are excellent times for getting stories in the media because there is less 'news' going on.

Evaluation Of Success

Your evaluation of success is rooted in your campaign aims and goals, but can only be focussed on smaller tasks and activities. What is important is to have a shared understanding within the campaign and its activists of what the criteria for success are, so that people stay motivated and focussed.

The criteria for success might be simple - such as a certain number of people who sign a high street petition, or a particular amount of money raised, or the thousandth envelop posted. These small milestones give the opportunity for celebration and a shared sense of achievement.

But evaluation is not just about the things that went well. If a particular event is a wash-out or a direct mail letter does not receive a high response level, you need to find out why. Assessment of failure is an important way to ensure that you get it right next time.

A Guide to Action

A campaign plan is essential to success, but a campaign plan which gathers dust or is used to prop up a wobbly table in the campaign HQ is pointless. Your plan should be a living document, being endlessly updated and tested against reality. It is a guide to action, which is regularly discussed and improved.

Campaign Planning Checklist

All campaigns need a plan
Try to win widespread support for your plan amongst your supporters
But don't allow it to be written 'by committee'
Decide on your objective
Decide on your targets to help you achieve your objective
Decide what you want to say
And who you want to say it to
And how you want to say it
And when, and for how long you want to say it
Be flexible and adaptable
Be prepared for the unexpected
Profit from opportunities
Learn from setbacks
Update and evaluate your plan regularly
Remember - nothing worth having is won without a struggle!

A Checklist For Producers Starting A New Value-Added Agriculture Business

2009-02-21T16:30:00.000-08:00

Prepared by: Ramon A. Kahulugan

PHASE 1: EXPLORATION AND ASSESSMENT

This phase sets the stage for your new value-added ventur

You need to surround yourself with a hard-working set of producers and a knowledgeable set of resource-providers.

Also, you must make sure that everyone involved has the same vision.

If you cannot agree to a common purpose and vision upfront, developing the business plan and recruiting potential producer-investors will be very difficult.

Form a steering committee. Choose a group people who are well-respected, hard-working and willing to work as a team to build your new business. You should also make sure that the individuals represent the various geographic areas your project will likely involve during the start-up process.

Identify your shared purpose, vision, mission and values. Ask yourself, “what is our reason for joining together as group of producers?”, “what do we want to be in 5 and 10 years?” and “what are the things we value?”

Formulate and develop your business ideas. Determine how you plan to capture value from your commodities and narrow your list to a few options. You can begin the process by brainstorming in your steering group, or you can work with persons who are knowledgeable about market opportunities in specific commodity sectors. It may require a little research to find the business idea that best meets your purpose, but you can assign parts of this task to members of your steering committee.

Conduct an initial assessment of your market opportunities. Ask yourself “does this idea make sense given the competitive environment of the industry?” and “will this provide a good or service that someone will be willing to purchase?”

Identify resource providers, such as facilitators, information specialists, and consultants, to assist you in the start-up of your venture. You need to surround yourself with good resource providers. Whether it is an, a local economic developer, an Ag Innovation Center staff member or other value-added agriculture professional, there are resource providers available to assist you throughout the state. These resource providers can help you locate information, facilitate and plan meetings, and help you manage the project from idea to implementation.

Prepare a budget for estimated start-up expenses and develop a financing plan for paying for these expenses. Potential sources of funds for start-up expenses are producers and other local sources, businesses in your area, local associations, and state or federal grant funds. In order to gauge commitment to the project, producers should be asked to contribute at least part of the start-up expenses.

Incorporate your new organization under appropriate state statutes. You will need to hire experienced attorneys to help you with this stage.

PHASE 2: FEASIBILITY

Conduct initial market research and analysis to narrow down your options for potential business ideas. You will need to make an initial determination based upon your market research whether your business idea has the potential to bring value back to your group of producers. The feasibility study step can be very costly, so your initial market research and analysis is critical in ultimately obtaining a high-quality, focused market feasibility study.

Prepare a market feasibility study, which is an analysis of the investment decision. The market feasibility study will determine whether your business idea is feasible from a technical, financial and organizational perspective. The market feasibility study is an analysis of the market demand for a specific product or service and answers key questions about your idea, including the level of production required for efficiently operating the processing or marketing business that you proposed. The feasibility study helps you understand existing and potential market demand for the good or service, the minimum efficient scale needed for production, potential marketing channels, current industry structure, and competitive environment in the industry.

Make sure the feasibility study answers the questions you need in making the decision whether to continue to pursue the project or not. Once you receive the final feasibility study, you may want to ask the following questions when reviewing the completed feasibility analysis:

What assumptions were made in preparing the feasibility study? Do you agree with those assumptions? How would the results of the study change if some of the assumptions changed?
Does the market feasibility study anticipate best-case and worst-case scenarios?
How did the consultants obtain their information?
Does the study identify and address potential risk factors?

If your market research and feasibility study are positive, meaning you have a good business idea that will bring a positive return on investment back to producers, you are ready to develop a business plan which will guide you through the specifics of building your producer-owned value-added business

PHASE 3: PLANNING

Review your legal organization, and determine what regulatory requirements, taxes, insurance, and intellectual property issues need to be addressed. Your attorney will assist you in designing an organization that meets the needs of your own group of producers. You will formalize the initial board of directors at this time, so you will need to identify board members with board officers. The steering committee should answer several simple questions before meeting with your attorney to develop your organizational documents:

Who Do You Want to Own the Organization? How will your organization be capitalized? Where will your equity come from? Will it only come from agricultural producers? Will you obtain equity from oher sources?
Who Do You Want to Control the Organization? Should the organization be a democratic one, with one-member/one-vote? Or should voting rights based upon level of investmen? Who will make decisions?
Who Do You Want to Benefit From the Organization? How will conributors of equity capital benefit from the organization? Will rewards come through higher commodity prices paid to producers? Through stock dividends? How will profits be distributed--returned to investors, reinvested in the business to fund operations or future expansion, or returned on the basis of patronage?

Begin writing your business plan. The business plan is an important document in that it becomes your action plan for creating a successful business. The business plan uses information you collected in the market feasibility stage and creates an implementation plan, which will include financial, governance, procurement, risk management, operations and management issues.

Determine plant and equipment needs. Your market feasibility study should provide guidance in your specific plant and equipment needs for your new venture.

Determine how you will finance the business. You should estimate that at least 40% of the total project cost will need to be provided upfront—this should primarily come from producers, but additional equity could be obtained through private sources. Your ability to raise funds from producers and non-producers is affected by state and federal tax, securities and corporation laws. You may also be eligible for tax credits, loan guarantees, and other financial assistance, however these programs often have specific requirements that may affect how you will need to structure your business.

Determine whether producers will need to make any changes in production practices to meet any quality requirements necessary. If you are going to sell a high-quality processed good to

consumers, you will need a quality control system throughout the entire process—from gate to plate—to ensure a quality end product.

Select a site for your operations. Selection of the site is critical as your location must be competitive in terms of transportation, input procurement and/or proximity to consumers. It may not always make financial sense to have a processing facility in your own town. If your goal is to obtain a positive return on investment in the value-added venture, you must be open to looking at sites away from your local area.

Obtain feedback on your business plan from persons not involved in the project to make sure your business plan has addressed required issues and makes sense to other persons. Sometimes an outside perspective can help you identify areas that need clarification or improvement.

Hire initial human resources, the staff who will run the business. Your hiring decisions are critical, especially early management you may hire to oversee the construction and equity drive. You should hire people with experience, and you need to realize that hiring capable people with experience may be costly.

Meet with engineering design and construction firms. Meet with several engineering design and construction firms to determine which firm has the services and price which best fit the specific needs of your project. You will likely want to competitively bid your design and construction projects to make sure you can make an informed comparison of the services and prices offered by competing firms.

Once you have completed a comprehensive business plan and you have a clear plan for capitalizing and implementing your business, you are ready to move to the Implementation Phase.

PHASE 4: IMPLEMENTATION

Meet with lenders to share your business plan and discuss potential debt financing options. As stated above, most lenders will require that you must contribute at least 40% of the total project cost upfront before they will provide any debt financing. Lenders will want to see a complete business plan with all of potential risk factors identified.

Prepare prospectus, offering circular or other investment documents. The prospectus, also called an offering circular, provides prospective producer-members with the information they need to make an informed decision about investing in the new venture. It is critical that you hire experienced and qualified legal expertise to prepare your investment documents, as mistakes can be costly. Make sure the attorney you hire understands cooperative, corporation and securities laws and can ensure that all the necessary steps are completed before soliciting money from producers or other investors. You must make sure that your organizational documents allow for non-producer investment and that you comply with all state and federal securities laws in securing both producer and non-producer financial participation in your new venture.

Secure equity capital through producer members. Once your prospectus is completed, you will need to conduct meetings with prospective producer-members. At these meetings you will share your prospectus, provide an overview of the new venture, and answer any questions producers have in analyzing their decision to invest in the new venture. These meetings may be your one chance to convince other producers to invest in your project, so make sure these meetings are well-planned and that you are able to adequately answer the questions producer-members are likely to ask.

Secure equity capital through non-producer investors, if required. Your business plan and prospectus will specify your plans for securing equity from non-producer investors. Again, you must make sure that your organizational documents allow for non-producer investment and that you comply with all state and federal securities laws in securing both producer and non-producer financial participation in your new venture.

Secure debt. Once you have raised the required equity, you are ready to finalize your loan with the lender.

Begin construction or remodeling of facilities. Once you have received approval from your lender, you can begin construction or remodeling activities. To save valuable time, be sure to meet with engineering design and construction firms and bid out your design and construction projects so that you can begin construction activities soon after you secure the loan.

Hire additional staff members and develop a system for selecting, retaining and training people-human resources. Your board and new management team should hire additional employees and develop a system for appraising the performance of your staff.

– Once you have implemented the immediate aspects of your business plan, you are ready to move to the Operations Phase and become a fully-functioning business.

PHASE 5: OPERATIONS

Make sure you communicate regularly with your members. Effective member relations is critical. Your producer-members own your new business and they will want to be updated regularly on the status of the business.

Establish a system for monitoring performance of management and other human resources. The Board of Directors will need to have clearly identified performance objectives for the management team, and the management team should then make sure there is a system for appraising the performance of employees on a regular basis.

Develop a strategic plan to guide your organization after the start-up process which includes growth or exit strategies.

You should continue to revise your strategic plan as external conditions change so that you can adapt quickly to changes in the competitive environment. Your opportunities as a business will continue to change as the competitive environment changes. You will need to continually update your strategic plan to ensure that your organization will be able to effectively compete, grow or transition over time.

Local Economy Development Training Module (LED-TM)

2009-02-21T00:30:00.000-08:00

Local Economic Development (LED) is an approach towards economic development which allows and encourages local people to work together to achieve sustainable economic growth and development thereby bringing economic benefits and improved quality of life for all residents in a local municipal area.

As a programme, LED is intended to maximise the economic potential of all municipal localities throughout the country and, to enhance the resilience of the macro-economic growth through increased local economic growth, employment creation and development initiatives within the context of sustainable development. The “local” in economic development points to the fact that the political jurisdiction at a local level is often the most appropriate place for economic intervention as it carries alongside it the accountability and legitimacy of a democratically elected body.

LED Programmes provides support in the following areas:

Development and review of national policy, strategy and guidelines on LED;
Providing direct and hands-on support to provincial and local government;
Management of the Local Economic Development Fund;
Management and Technical Support to Nodal Economic Development Planning;
Facilitating coordinating and monitoring of donor programmes, and
Assisting on LED capacity building processes.

Through these interventions, resources, local role-players and interest groups are mobilized for the sake of achieving economic growth and creating jobs to reduce poverty.
Integrated Development Plan (IDP) is a process by which municipalities prepare 5- year strategic plans that are reviewed annually in consultation with communities and stakeholders. These plans adopt an implementation approach and seek to promote integration by balancing social, economic and ecological pillars of sustainability without compromising the institutional capacity required in the implementation and coordinating of actions across sectors and spheres of government.

In recent years regional and local economies have had to face increasing challenges. The process of globalization is rapidly altering the economic status quo and presenting new economic opportunities and risks for cities, regions and nations all over the world.

In this changing context, national and local governments, as well as enterprises and other organisations have to rethink development strategies in order to cope with and to take advantage of existing transformations.

As opposed to traditional development policies, Local Economic Development strategies:

empower local societies and generate local dialogue. People living in areas of the world that have until recently had little say or control over the economic activity taking place in their territory, begin to adopt a more proactive stance with regard to their own future;
help to make local institutions more transparent and accountable and contribute to the development of the local civil society;
make economic activity dependent on the specific economic conditions and comparative advantages of a defined territory, generate sustainable employment in firms more capable to withstand changes in the global economic environment;contribute to a general improvement in the quality of jobs as a result of the involvement of local stakeholders and of the rooting of economic activity in a territory.

Training Module

A. Defining Local Economic Development (LED)

an approach for development, pooling all the stakeholders

Purpose:

to build up the economic capacity of a local area to improve its local economy and thereby improve the quality of life for all.
It is a process by which public, business and nongovernmental sector partners work collectively to create better conditions for economic growth and employment generation.
It focuses on enhancing competitiveness, increasing sustainable growth and ensuring that growth is inclusive.

LED encompasses a range of disciplines:

physical planning,
economics
marketing.
environmental planning,
business development,
infrastructure provision,
real estate development and finance.
economic development

B. LOCAL ECONOMIC DEVELOPMENT STRATEGIES

different geographic scales.
for the benefit of local government’s jurisdiction,
individual communities and areas within a local government's jurisdiction
Such approaches are most successful if pursued in partnership with local government strategies.

Local communities respond to their LED needs in many ways, and a variety of approaches can be taken that include:

local investment climate is functional;
small and medium sized enterprises;
formation of new enterprises;
Attracting external investment (nationally and internationally);
Investing in physical (hard) infrastructure;
Investing in soft infrastructure (educational and workforce development, institutional support systems and regulatory issues);
Supporting the growth of particular clusters of businesses;
Targeting particular parts of the city for regeneration or growth (areas based initiatives);
Supporting informal and newly emerging businesses;
Targeting certain disadvantaged groups.

Local Economic Development strategies:

empower local societies and generate local dialogue.
help to make local institutions more transparent and accountable and,
contribute to the development of the local civil society;
make economic activity dependent on the specific economic conditions and comparative advantages of a defined territory,
generate sustainable employment in firms more capable to withstand changes in the global economic environment;
contribute to a general improvement in the quality of jobs as a result of the involvement of local stakeholders and of the rooting of economic activity in a territory.

C. Participatory Development for Local Empowerment

promotes a participatory development process. It encourages partnerships between the main private and public stakeholders and enables the joint design and implementation of a common development strategy. The overall objective is to base economic activity on social conditions and local resources, rather than vice-versa.

D. The main aim of local economic development (LED)

encourage local participation and consensus building to determine economic and social welfare initiatives for the locality and the community.
The concept of local economic development is based on promoting local approaches that respond to local needs and conditions.
The importance of local ownership of the development process is however central to most local economic development approaches, which simultaneously views development within the context of governance and civil society at all levels.

E. LED Strategic Planning

The development of an LED strategy will be an integral part of a broader strategic planning process
Effective strategic planning ensures that priority issues are addressed and limited resources are well targeted.
The five-step planning process detailed should be tailored to complement, and correspond with, other local planning processes. The process is not prescriptive and should be adapted to meet the needs of the individual community.

The five-step planning process

Stage One: Organizing the Effort

identifying the people, public institutions, businesses, community organizations and other groups with interests in the local economy.
The skills and resources that each of these stakeholders bring to the strategy process provide a critical foundation for success.
A resource audit is a necessary input to the strategy, and should include the identification of financial, human and other capital resources that can contribute to the LED strategy.
Working groups and steering committees can be established to ensure that both formal and informal structures are in place to support strategy development and implementation.
Other issues that need to be tackled in the early stages include establishing LED staff teams and appropriate political processes

• Establishment of a Steering Committee

The Steering Committee should include key stakeholders from all sectors including the local authority. The local authority will usually provide institutional support for this committee. This provides them with a degree of control that may be needed in the early days of establishing the LED strategy and partnerships.

• Establishment of a group within the local authority to oversee the LED process.

This group should include people from across the various local authority departments that are likely to have an interest or professional, technical, political or financial responsibility for matters affected by the LED strategy. Membership should be at both Elected Member and at officer levels. There should be terms of reference and a formal reporting system for the group. Transparency and public access to information used or generated by the group is important to its credibility.

Stage Two: Conducting the Local Economy Assessment

The aim of the local economy assessment:
to identify the community's strengths and weaknesses
human resource capacity,
local government's 'friendliness' to all types of business activities from corporate to informal,
the opportunities and threats facing the local economy.

The goal:

ECONOMIC PROFILE
comparative and competitive advantage in relation to neighboring communities and other regional, national or international competitors.

Stage Three: Developing the LED Strategy

a shared economic vision for the community
goals, objectives, programs, projects and action plans will be developed.
ensures that all major stakeholder groups are given the opportunity to define:
what is to be achieved,
how it is to be achieved,
who will be responsible and
the timeframes associated with the implementation of the LED strategy.
the staff resource capacity to carry them out,
as well as the budgetary constraints.
Ultimately, the strategy's action plans should be incorporated into the work and budgetary program of the local authority
The aim is to leverage strengths, overcome weaknesses, exploit opportunities and deal with threats.

Stage Four: Implementing the LED Strategy

LED action plans.

Ongoing monitoring is provided through the formal structures identified and created in step one, and
evaluation of specific project outcomes ensures that the strategy continues to lead to the achievement of the LED vision, goals and objectives.
In undertaking strategy implementation, it is important to identify and establish the appropriate institutions to carry out the plans.

Stage Five: Reviewing the LED Strategy

Good monitoring and evaluation techniques help to quantify outcomes, justify expenditures, determine enhancements and adjustments, and develop good practices.
This information also feeds into the review of the complete LED strategy.
The LED strategy should be reviewed at least annually to ensure that it remains relevant. It may be that conditions have changed or that the initial assessment was incorrect to the local conditions.
The LED strategy should evolve continuously to respond to the ever changing competitive environment