Indoor Shrimp Farming business plan for starting your own business

Food is one of the businesses that can never be out of business, no matter what. So, if you want to start a business of your own, this indoor shrimp farm business plan can be a good starting point for you. You can start this business with relatively little capital and make a good amount of money while you are at it. For those who want to know how to start shrimp farming, this document will cover all there is to it. As a matter of fact, shrimp aquaculture has recently become a lucrative business. We are writing a strategic business plan for this startup that you can use to start the business for yourself. Many of the aspects of this business would be the same as those for oyster farming business plan.

Executive Summary

2.1 The Business

Packard Shrimp Farm will be a registered and insured saltwater shrimp farming business in Tucson, Arizona. The business will provide fresh shrimp and other seafood to the area. We are starting a shrimp farm but will soon move to producing other types of seafood as well. Just like we did in the indoor shrimp farming business plan for farmers market, it is important that we have a solid management structure so that we can run the business successfully and effectively.

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2.2 Management of Indoor Shrimp Farming Business

To answer the question how to set up a shrimp farm, the first thing that you need to do is to make a comprehensive management structure of the business that will look after various aspects of running the business.

You can use this business plan for investors telling them that the business will be headed by the owner, and they will hire three executives to take care of various aspects of the business on a daily basis.

2.3 Customers of Indoor Shrimp Farming Business

As shrimp is a delicacy enjoyed by everyone, the customers of this business will be from all fields of life and all social and economical classes of the society. The main customers of this business will include:

  • Domestic customers who need the shrimp for personal use.
  • Local supermarkets.
  • Restaurants and hotels.
  • Seafood retailers.

2.4 Business Target

The target of this business is to make money by capitalizing on the fact that not even a single service provider in the area is offering fresh shrimp. This target will be broken down into the following actionable goals:

  • Becoming permanent suppliers for commercial customers.
  • Providing fresh shrimp of the highest quality in the area.
  • Matching production to the demand of the product in the area.
  • Achieving and maintaining 100% customer satisfaction.
3 Years Profit Forecast - Indoor Shrimp Farming Business Plan Sample
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Company Summary

3.1 Company Owner

John Packard will be the owner of the business. There is no one on the seven continents who knows better than John how to raise saltwater shrimp. He has been working in the industry since the time he was 15 and knows the business inside out.

3.2 Why the Indoor Shrimp Farm is being started?

Before you can know how to start a shrimp farm freshwater, it is important to know why the business is being started. If we have a look at the supply of shrimp in the area, it can give us the answers we are looking for. There is not even a single service provider in the area who provides fresh shrimps. People are sick of the frozen shrimp in the market and want to buy the fresh stuff. This means that there is a lot of demand for the product in the market.

The other reason John is starting a shrimp farm business is that he has recently retired from his job and now wants to start something of his own and this is the only thing that he knows how to do.

3.3 How the Indoor Shrimp Farm will be started?

The next thing that is important to discuss in this indoor shrimp farming business plan is how the business will even be started. Here are the steps for that:

Step1: Market Assessment  

The first thing that needs to be done to start this business is to see the demand for the product in the market. Having a clear idea of the demand for the product is of paramount importance in starting any business. John ran a thorough market need assessment and has come to the conclusion that there is a lot of demand for the product and the business can be a successful one.

Step2: Establishing the Farm

Once the market’s demand is known, the next step in answering the question how to start a indoor shrimp farm is to establish the farm in accordance to the demand of the market. This will be done by acquiring land, building the farm, and equipping it with all that is needed to run the farm efficiently.

Step3: Making A Retail Outlet    

The next thing is to have a point of sale where the product will be sold from. This will be made in a prominent area of the city where we can easily get a lot of customers.

Step4: Going Online

In this day and age, everyone buys and searches for stuff online and that makes it immensely important to have an online presence. The farm and all its products will be advertised online and an online store will also be setup for marketing the product.

Startup Cost - Indoor Shrimp Farming Business Plan Sample
Start-up Expenses 
Legal$242,000
Consultants$0
Insurance$30,000
Rent$31,000
Research and Development$25,000
Expensed Equipment$57,000
Signs$4,100
TOTAL START-UP EXPENSES$389,100
Start-up Assets$353,000
Cash Required$366,000
Start-up Inventory$39,000
Other Current Assets$232,000
Long-term Assets$275,000
TOTAL ASSETS$1,265,000
Total Requirements$1,654,100
START-UP FUNDING 
Start-up Expenses to Fund$389,100
Start-up Assets to Fund$1,265,000
TOTAL FUNDING REQUIRED$1,654,100
Assets 
Non-cash Assets from Start-up$1,657,000
Cash Requirements from Start-up$384,000
Additional Cash Raised$52,000
Cash Balance on Starting Date$39,000
TOTAL ASSETS$2,132,000
Liabilities and Capital 
Liabilities$29,000
Current Borrowing$0
Long-term Liabilities$0
Accounts Payable (Outstanding Bills)$48,000
Other Current Liabilities (interest-free)$0
TOTAL LIABILITIES$77,000
Capital 
Planned Investment$1,654,100
Investor 1$0
Investor 2$0
Other$0
Additional Investment Requirement$0
TOTAL PLANNED INVESTMENT$1,654,100
Loss at Start-up (Start-up Expenses)$400,900
TOTAL CAPITAL$2,055,000
TOTAL CAPITAL AND LIABILITIES$2,132,000
Total Funding$1,654,100
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    Services

    The next step towards starting an indoor shrimp farming business plan is determining the services that the farm will be providing. Just like a pig farming business plan, it is important that we have an idea of the services before starting the business because only then we can optimize the operations of the business. Everyone knows how to build a shrimp farm and yet shrimp farms fail. That is because the shrimp farm business plan people use lacks the services part.

    The indoor shrimp farming business plan operations cannot be run the right way if you do not have an idea of the services the farm will be providing. So here’s how to start an indoor shrimp farming business plan according to the services the business will provide:

    Fresh Shrimp Supply

    The main service of the business will be the supply of fresh shrimp in the area.

    Seafood Supply

    All other kinds of seafood that are not available in the area will also be produced and supplied by the business.

    Experimental Seafood Farming

    A part of the business will be dedicated to experimentation for developing new and ore efficient ways of farming seafood.

    Ready to Eat Seafood  

    The farm will also provide pre-cooked seafood that the customers can heat and eat.

    Marketing Analysis of Indoor Shrimp Farm

    Business plan for investors

    If you want to know how to make a shrimp farm, one of the most important steps in the process is that of conducting the marketing analysis of the business. This might not look important, but it is immensely important in making the business a success. This is here that we look what is the feasibility of starting the business and how would the shrimp farm design so that it can generate the type of profit we want it to.  This step includes having a look at the market trends and the marketing segmentations of the business.

    5.1 Market Trends

    If you want to know in detail how to start a shrimp farming business, you will have to have a look at the market trends of the business. The consumption of the product has steadily increased over the last few years, making the business a very profitable one for new entrants. Part of the profitability can be attributed to the easy shrimp farming process.

    5.2 Marketing Segmentation

    If you want to start shrimp farming indoors, you need to know the segments of market that you will be serving. The tentative marketing segmentation of shrimp farming will be the following:

    Marketing Segmentation - Indoor Shrimp Farming Business Plan Sample

    5.2.1 Private Customers

    People who enjoy shrimp and want to buy fresh product will be the main market segment for us.

    5.2.2 Retail Businesses

    Seafood retailers and supermarkets in the area will also be an important market segment for us.

    5.2.3 Hotels and Restaurants

    We will provide the shrimp and other seafood to the hotels and restaurants in the area.

    5.2.4 Wholesalers

    Businesses that provide shrimp and other seafood to other businesses on a wholesale basis will also be one of the market segments for us.

    Market Analysis       
    Potential CustomersGrowthYear 1Year 2Year 3Year 4Year 5CAGR
    Private Customers30%32,00034,00036,00038,00040,00010.00%
    Retail Businesses25%26,00028,00029,00031,00033,00010.00%
    Hotels and Restaurants23%22,00023,00025,00027,00028,00010.00%
    Wholesalers22%19,00020,00022,00024,00026,00011.00%
    Total100%99,000105,000112,000120,000127,00010%

    5.3 Business Target

    • To become the number 1 provider of shrimp in the area.
    • To become the sole supplier of shrimp for local retail businesses.
    • To become the major shrimp supplier for local restaurants.
    • To make a credible brand around the business.

    5.4 Product Pricing

    The products will be sold at a premium price as there is no provider in the area that offers the product.

    Marketing Strategy

    Just like cannabis business plan, even if you ware starting a small scale indoor shrimp farming business plan, you need to have a proper marketing strategy to make the business successful. Many indoor shrimp farming systems fail due to the lack of a proper sales and marketing strategy. Before we start to build indoor shrimp farm, it is important to formulate a sales strategy.

    Any questions? Get in Touch

    If you are going to start indoor shrimp farming business plan at home, here is the competitive analysis and sales strategy that you can use.

    6.1 Competitive Analysis

    1. There is not even a single business in the area that provides fresh shrimp and other seafood.
    2. There is a lot of demand for indoor freshwater shrimp farming in the area.
    3. People are ready to buy the products of a shrimp farm at whatever price we might charge for it.

    6.2 Sales Strategy

    • We will make long-time contracts with local businesses and hotels.
    • We will offer discounted rates in the start.
    • We will make no compromises on the quality of the goods we supply.

    6.3 Sales Monthly

    Sales Monthly - Indoor Shrimp Farming Business Plan Sample

    6.4 Sales Yearly

    Sales Yearly - Indoor Shrimp Farming Business Plan Sample

    6.5 Sales Forecast

    Unit Sales - Indoor Shrimp Farming Business Plan Sample
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      Sales Forecast   
      Unit SalesYear 1Year 2Year 3
      Fresh Shrimp Supply60,00063,60067,416
      Seafood Supply70,00074,20078,652
      Experimental Seafood Farming30,00031,80033,708
      Ready to Eat Seafood50,00053,00056,180
      TOTAL UNIT SALES210,000222,600235,956
      Unit PricesYear 1Year 2Year 3
      Fresh Shrimp Supply$47.00$54.52$63.24
      Seafood Supply$43.00$49.88$57.86
      Experimental Seafood Farming$45.00$52.20$60.55
      Ready to Eat Seafood$39.00$45.24$52.48
      Sales   
      Fresh Shrimp Supply $2,820,000.00 $3,467,472.00 $4,263,603.57
      Seafood Supply $3,010,000.00 $3,701,096.00 $4,550,867.64
      Experimental Seafood Farming $1,350,000.00 $1,659,960.00 $2,041,086.82
      Ready to Eat Seafood  $1,950,000.00 $2,397,720.00 $2,948,236.51
      TOTAL SALES$9,130,000.00 $11,226,248.00 $13,803,794.54
      Direct Unit CostsYear 1Year 2Year 3
      Fresh Shrimp Supply$45.00$53.00$60.00
      Seafood Supply$41.00$46.00$54.00
      Experimental Seafood Farming$45.00$50.00$57.00
      Ready to Eat Seafood$37.00$42.00$49.00
      Direct Cost of Sales   
      Fresh Shrimp Supply $2,700,000.00 $3,370,800.00 $4,044,960.00
      Seafood Supply $2,870,000.00 $3,413,200.00 $4,247,208.00
      Experimental Seafood Farming $1,350,000.00 $1,590,000.00 $1,921,356.00
      Ready to Eat Seafood  $1,850,000.00 $2,226,000.00 $2,752,820.00
      Subtotal Direct Cost of Sales$8,770,000.00 $10,600,000.00 $12,966,344.00

      Personnel plan

      Just like a mushroom farming business plan, this business needs a lot of manpower to run and for that reason making a proper personnel plan is of paramount importance in making an indoor saltwater shrimp farming business a success.

      7.1 Company Staff

      The following staff will be needed to run the indoor aquaculture shrimp farming business:

      • John Packard will be the owner and CEO of the business.
      • 3 managers will be hired to run the day to day affairs of the farm.
      • 4 farm workers.
      • 2 delivery drivers.
      • 1 storekeeper.
      • 1 cashier.
      • 1 guard.

      7.2 Average Salary of Employees

      Personnel Plan   
       Year 1Year 2Year 3
      Managers$39,000$42,900$47,190
      Farm Workers$40,000$44,000$48,400
      Delivery Drivers$18,000$19,800$21,780
      Storekeeper$8,000$8,800$9,680
      Cashier$9,000$9,900$10,890
      Guard$9,000$9,900$10,890
      Total Salaries$123,000 $135,300 $148,830

      Financial Plan

      shrimp business for sale, indoor shrimp farming profits.

      If you want to start shrimp farming, you can either buy a shrimp business for sale or start your own setup from start. To keep your indoor shrimp farming business plan profits at the highest level, it is important to invest the minimum amount and make the most profit. Here are the costs that will be involved in starting the business. You can notice the close resemblance of the costs with those in the indoor shrimp farming business plan for a fish farm.

      • Cost of real estate.
      • Money spent on civil works to start the farm.
      • Cost of advertisement.
      • Money for buying farm and delivery vehicles.
      • Salaries of employees.
      • Recurring costs for the time before the farm starts making profits.

      8.1 Important Assumptions

      General Assumptions   
       Year 1Year 2Year 3
      Plan Month123
      Current Interest Rate8.28%8.22%8.26%
      Long-term Interest Rate8.41%8.47%8.52%
      Tax Rate24.00%24.50%25.80%
      Other000

      8.2 Break-even Analysis

      Break-even Analysis - Indoor Shrimp Farming Business Plan Sample
      Break-Even Analysis 
      Monthly Units Break-even5344
      Monthly Revenue Break-even$131,500
      Assumptions: 
      Average Per-Unit Revenue$235.00
      Average Per-Unit Variable Cost$0.66
      Estimated Monthly Fixed Cost$163,490
      Any questions? Get in Touch!

        8.3 Projected Profit and Loss

        Pro Forma Profit And Loss   
         Year 1Year 2Year 3
        Sales$9,130,000 $11,226,248 $13,803,795
        Direct Cost of Sales$8,770,000 $10,600,000 $12,966,344
        Other$0$0$0
        TOTAL COST OF SALES$8,770,000 $10,600,000 $12,966,344
        Gross Margin$360,000 $626,248 $837,451
        Gross Margin %3.94%5.58%6.07%
        Expenses   
        Payroll$123,000$135,300$148,830
        Sales and Marketing and Other Expenses$128,000$133,000$140,000
        Depreciation$2,200$2,350$2,480
        Leased Equipment$0$0$0
        Utilities$2,900$3,000$3,100
        Insurance$2,100$2,100$2,100
        Rent$3,100$3,200$3,300
        Payroll Taxes$26,000$27,000$28,000
        Other$0$0$0
        Total Operating Expenses$287,300 $305,950 $327,810
        Profit Before Interest and Taxes$72,700$320,298$509,641
        EBITDA$72,700$320,298$509,641
        Interest Expense$0$0$0
        Taxes Incurred$14,540$64,060$101,928
        Net Profit$58,160$256,238$407,712
        Net Profit/Sales0.64%2.28%2.95%

        8.3.1 Profit Monthly

        Profit Monthly - Indoor Shrimp Farming Business Plan Sample

        8.3.2 Profit Yearly

        Profit Yearly - Indoor Shrimp Farming Business Plan Sample

        8.3.3 Gross Margin Monthly

        Gross Margin Monthly - Indoor Shrimp Farming Business Plan Sample

        8.3.4 Gross Margin Yearly

        Gross Margin Yearly - Indoor Shrimp Farming Business Plan Sample

        8.4 Projected Cash Flow

        Projected Cash Flow - Indoor Shrimp Farming Business Plan Sample
        Pro Forma Cash Flow   
        Cash ReceivedYear 1Year 2Year 3
        Cash from Operations   
        Cash Sales$56,000$60,480$65,318
        Cash from Receivables$22,000$23,760$25,661
        SUBTOTAL CASH FROM OPERATIONS$78,000 $85,020 $91,822
        Additional Cash Received   
        Sales Tax, VAT, HST/GST Received$0$0$0
        New Current Borrowing$0$0$0
        New Other Liabilities (interest-free)$0$0$0
        New Long-term Liabilities$0$0$0
        Sales of Other Current Assets$0$0$0
        Sales of Long-term Assets$0$0$0
        New Investment Received$0$0$0
        SUBTOTAL CASH RECEIVED$78,000 $86,000 $92,000
        ExpendituresYear 1Year 2Year 3
        Expenditures from Operations   
        Cash Spending$38,000$40,000$41,000
        Bill Payments$23,000$26,000$29,000
        SUBTOTAL SPENT ON OPERATIONS$61,000 $66,000 $70,000
        Additional Cash Spent   
        Sales Tax, VAT, HST/GST Paid Out$0$0$0
        Principal Repayment of Current Borrowing$0$0$0
        Other Liabilities Principal Repayment$0$0$0
        Long-term Liabilities Principal Repayment$0$0$0
        Purchase Other Current Assets$0$0$0
        Purchase Long-term Assets$0$0$0
        Dividends$0$0$0
        SUBTOTAL CASH SPENT$61,000 $65,880 $71,150
        Net Cash Flow$19,000$21,000$22,000
        Cash Balance$27,000$31,000$34,000

        8.5 Projected Balance Sheet

        Pro Forma Balance Sheet   
        AssetsYear 1Year 2Year 3
        Current Assets   
        Cash$275,000$308,000$338,800
        Accounts Receivable$24,000$26,880$30,213
        Inventory$4,120$4,614$4,900
        Other Current Assets$1,000$1,000$1,000
        TOTAL CURRENT ASSETS$286,000 $320,320 $360,040
        Long-term Assets   
        Long-term Assets$10,000$10,000$10,000
        Accumulated Depreciation$19,800$22,176$24,948
        TOTAL LONG-TERM ASSETS$25,000 $28,000 $31,500
        TOTAL ASSETS$298,000 $333,760 $375,480
        Liabilities and CapitalYear 4Year 5Year 6
        Current Liabilities   
        Accounts Payable$19,000$21,280$23,919
        Current Borrowing$0$0$0
        Other Current Liabilities$0$0$0
        SUBTOTAL CURRENT LIABILITIES$20,000 $22,400 $25,178
        Long-term Liabilities$0$0$0
        TOTAL LIABILITIES$16,600 $18,592 $20,897
        Paid-in Capital$30,000$30,000$31,000
        Retained Earnings$56,000$61,040$67,144
        Earnings$199,000$216,910$238,601
        TOTAL CAPITAL$286,000 $311,740 $342,914
        TOTAL LIABILITIES AND CAPITAL$302,600 $333,760 $375,480
        Net Worth$299,000$325,910$358,501

        8.6 Business Ratios

        Ratio Analysis    
         Year 1Year 2Year 3INDUSTRY PROFILE
        Sales Growth7.26%8.04%8.91%3.00%
        Percent of Total Assets    
        Accounts Receivable9.24%10.24%11.34%9.80%
        Inventory5.44%6.03%6.68%9.90%
        Other Current Assets2.10%2.33%2.58%2.40%
        Total Current Assets151.00%152.00%152.00%158.00%
        Long-term Assets11.40%11.60%11.64%12.00%
        TOTAL ASSETS100.00%100.00%100.00%100.00%
        Current Liabilities4.80%4.84%4.88%4.34%
        Long-term Liabilities0.00%0.00%0.00%0.00%
        Total Liabilities7.55%7.61%7.68%7.38%
        NET WORTH100.60%101.40%102.34%110.00%
        Percent of Sales    
        Sales100.00%100.00%100.00%100.00%
        Gross Margin94.34%96.89%99.60%99.00%
        Selling, General & Administrative Expenses93.80%96.33%99.03%97.80%
        Advertising Expenses1.49%1.53%1.57%1.40%
        Profit Before Interest and Taxes43.00%44.16%45.40%33.90%
        Main Ratios    
        Current34353632
        Quick3435.236.0833
        Total Debt to Total Assets0.18%0.18%0.17%0.40%
        Pre-tax Return on Net Worth74.08%75.00%75.04%75.00%
        Pre-tax Return on Assets94.60%99.33%104.30%111.30%
        Additional RatiosYear 1Year 2Year 3 
        Net Profit Margin33.20%34.23%35.29%N.A.
        Return on Equity54.68%56.38%58.12%N.A.
        Activity Ratios    
        Accounts Receivable Turnover7.77.87.8N.A.
        Collection Days100100100N.A.
        Inventory Turnover3233.633N.A.
        Accounts Payable Turnover151616.3N.A.
        Payment Days272727N.A.
        Total Asset Turnover2.52.52.6N.A.
        Debt Ratios    
        Debt to Net Worth-0.04-0.03-0.04N.A.
        Current Liab. to Liab.111N.A.
        Liquidity Ratios    
        Net Working Capital$237,000$250,272$264,287N.A.
        Interest Coverage000N.A.
        Additional Ratios    
        Assets to Sales0.860.870.87N.A.
        Current Debt/Total Assets1%0%0%N.A.
        Acid Test2929.1229.3N.A.
        Sales/Net Worth2.12.22.3N.A.
        Dividend Payout000N.A.

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