Assessment of Cooperatives in the Poultry Industry - 2013.pdf - Seda

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Research Report: Addressing the Needs, Opportunities and Challenges of Cooperatives and Collectively Owned Enterprises in the Poultry and Related Industries Figure 4-16: Has the Assistance Provided Benefitted the Cooperative? 8% 0% 44% Yes No Yes, but more is needed 48% Have not received assistance Source: Urban-Econ Survey, 2013 Approximately 48% of cooperatives who received assistance indicated that it had benefited them in their business, but mentioned that they would like to receive more support as there are still elements lacking in their business. Of the cooperatives surveyed, 44% had not received any support from external organisations. Positively, 8% of cooperatives had 48% of cooperatives who received assistance said that it had benefited them in their business but mentioned that they would like to receive more support received support and attributed the success of their business to the support that had been provided. Figure 4-17 below illustrates the types of support cooperatives would like to receive. This relates closely to the challenges cooperatives are facing at present (see below). Financial assistance is identified most often as the type of support cooperatives would like to receive, followed closely by training and equipment. The category ‘other’ above includes assistance with inputs/feed, electricity & water, transport and security. 61 | P a g e U r b a n - E c o n : D e v e l o p m e n t E c o n o m i s t s
Research Report: Addressing the Needs, Opportunities and Challenges of Cooperatives and Collectively Owned Enterprises in the Poultry and Related Industries Figure 4-17: Forms of Support Cooperatives Would Like to Receive Financial assistance 27% Training 22% Equipment 19% Marketing & advertising 10% Access to premises 7% Other 13% 0% 5% 10% 15% 20% 25% 30% Source: Urban-Econ Survey, 2013 The analysis that follows examines more closely the current challenges faced by cooperatives. It identifies, per category, where cooperatives identified their main challenges to be and what factors they view as contributing towards the deficiencies they see within their businesses. Figure 4-18 below shows the responses of cooperatives when asked about their current challenges. The main challenges highlighted by cooperatives are a lack of finances and a lack of equipment. This reinforces the information gathered in the background section (refer to Section 4.1.2.1). Cooperatives were very responsive regarding their challenges with most cooperatives stating that they do not have sufficient equipment to properly run their business. Due to the high cost of equipment, this is not a surprising challenge. Many poultry producers indicated above that they are not able to reinvest funds into the business. Without any savings it is unlikely that cooperatives are able to save enough money to invest in their businesses. Additionally, equipment is a highly constraining factor on business (and hence profit) growth. This is especially true in the case of broiler production, which constitutes the majority of cooperatives interviewed. With one broiler house a specific number of birds can be grown at a time. While cooperatives can work towards decreasing mortality rates and thereby marginally increasing profits, without additional chicken houses there is a ceiling on the numbers that can be produced. According to a DPFO representative interviewed, a fully equipped and well-designed chicken coop can cost around R3.8 million. With many cooperatives barely able to pay their own salaries, this is an unattainable piece of equipment. The main present day challenges highlighted by cooperatives were a lack of finances and a lack of equipment 62 | P a g e U r b a n - E c o n : D e v e l o p m e n t E c o n o m i s t s
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