Business Model of Food Grain Trading Firm

There a lot of trading firms which involve in trading business related to food grain items such as spicey items, rice, dal, chickpeas, salt, wheat, sugar, milk powder, etc. generally the food grain trading firm imported procures goods from different foreign and local sources based on its price benefit consideration.  The firm procures goods from the local market through cash or credit basis but whenever it procured goods from the foreign market through issuing L/C from its concerned banks. 

After receiving goods from delivery shipment, the firm stores its goods to the warehouse which may be rented or owned but a large number of trading firms use rented warehouses. Sometimes it sells its goods from the port area or before goods reached port or goods in transit moment.

Sales revenue of the trading firm generated from different types of sales methods like wholesales, sales through distributor or agents, retails, and online selling. But maximum sales revenue generates from wholesales procedures.  Sales may occur through cash and credit basis but maximum times sales occur through 50% cash and 50% credit sometime it will be paid after selling goods.  By the above way, a food grain-related trading firm generates its business operation to generates revenue from the market. Sometimes they are a success they fell in losses due to failure of due recovery from the market.

Business Model of Food Grain Trading Firm:

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Business model of Rice Mills

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Rice is our main food as a Bangladeshi because we take rice a minimum of twice a day. Rice is made from paddy which crushing by rice mills.  There different types of rice mills available in Bangladesh such as auto rice mills, semi-auto, and manual rice mills.

 Rice mills are established based on the availability of raw materials or paddy. Basically where industrialization is low but agricultural land is high especially rural and urban areas support us by cultivating paddy and agriculture goods.

The Concern authority of rice mills collects or procures raw materials by sourcing different local and domestic agents that are made based on its locality.  Sometimes they collect from the raw sources of materials that means from farmers. Due to syndicate sometimes it is not possible to follow the direct procurement method.

 After collecting or procuring the materials then drying the paddy if possible but it’s rare to do for the mill's owner. They crush the paddy based on auto, semi-auto mills, and make in bags using their brand logo and trademark.  Then the Firm or Mills owners sell the good as per buyer requirement through wholesales, distributor sales, and online sales process. But a large amount of sales process is occurred by the wholesales method. The mills' owners have to provide credit facilities to their regular wholesalers' customers which maybe 30 days to 45 days tenor, that’s why it’s required more working capital to run daily business operations.

Business Model of Rice Mills: 

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Business model of cow farm (Part-2)

Key Elements of Cow Farms:

Our input items: 1) Cow 2) Ox

Working capital: Required to run the daily operation at first need some food item i.e. husk, feed, to feed the cow, and bull, daily expenditure i.e. labor cost, carrying charge, electricity, and other expenditures.

Plant shed: It is required to make a plant shed for cow farming especially for nursing, take care, and other required activities. The shed must be made in a scientific way to get better health issues. 

Medical Service: Make a contract or appointment with a certified physician for ensuring perfect and continuous medical check-up of our cow and bull. 

Finished Products:  Milk is the prime product of the farm, anyone can convert the product as per market demand and supply gap make it 1) Curd 2) Ghee 3) Butter 4) Sweets items, etc. 5) also make biogas plant which may be another source of revenue generation. 

Production distributors: Farm can make its sales procedure from its farm premises or sales point. 

Business Model:

Supply Side		Demand Side
Farm procures goods, materials from local sources like various Mills, shops, etc.	Cow Farm	Sales of different goods like Milk, Curd, Ghee, Butter, Sweet, etc.
		It also sells Boi gas to the various household beside the farm

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Business model of Cow Farming (Part-1)

Any people who have a minimum amount of funds with land to start the farming business. Before involving the related business the person should learn some key facts about his products since we are talking here about cow farming. so, we can consider our main working factor is a cow. 

At first, we must forecast our project, its initial cost, fixed cost, working capital, its supply lines, and demand lines and others, etc. Now, we are going to make construction activities to establish and start our production process. 

Then, we think about collecting our main key product which is our main concern. Now, We think about which product we are going to see as finished goods. suppose we are going to think to produce a milk-related product like cow milk, meat, etc. now we should from which better alternative sources may we purchase our cow. We must ensure the machine and product quality. 

Now, I think about the production process, production flowchart, and specific guidelines to make the operation smoothly. 

Now, think about the finished products which help to generate revenue and earnings. We think, initially we start our cow farm with two product lines one consists of milk and cow another one consisted of meat. So, we start our project with five milk cows with calves and 5 bulls for meat. We may be targeted we are going to generate revenue of the first production line recently or within two to three months and the production line should be considered as a mid-long-range project.  

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Corporate Business firm

A lot of people involved in different types of activities to fulfill human requirements and need. In the case of their involvement, they try to make a profit by performing their activities. People are interested to make a profit and maximize their wealth. But some of them can be able to reach their destination, some of them continue their activities moderately and some of them are lost and close their activities. Today we try to discuss the term of business, its form, advantages, and disadvantages of the different forms of businesses separately from my point of view. Generally, a large number of manufacturing and heavy investment companies are constructed in the form of corporate which is called Company also. 

Corporate Firm:

An organization constructs with a bunch of people, authorized by the company act and state laws and starts to operate with a specific number of shareholders which is determined by the Company act and state laws.

We can say as a corporation firm which firm meets certain legal requirements to be recognized as having a legal existence, as an entity separate and distinct from its owners. It is owned by its stockholders (shareholders).

Keywords: The legal entity, company Law, state laws, shareholders, etc.

Advantages:

a.  Limited liability of the Company which is limited its number of shareholders

b. Easy availability of firm capital which is authorized by a joint-stock registered company. Corporations have perpetual existence; which exists beyond the death of the manager, Board of Directors and executives, etc.

c.  Easy transfer of ownership; ownership of share certificate easily transferable.

d. Building credibility; various stakeholders are ready to provide a debt obligation for strong legal support.

 

Demerits:

a. The complex process to start a business initially due to different legal bindings and authorities.

b.  Hight tax rate; in the case of corporate it has to more tax than other business firms.

c. Conflict of interest is high between different stockholders inside and outside the company.

d. Lacks of business confidentiality since it has to disclose its financial, quantitative, and qualitative information to the public. 

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A Partnership Firm

A lot of people involved in different types of activities to fulfill human requirements and need. In the case of their involvement, they try to make a profit by performing their activities. People are interested to make a profit and maximize their wealth. But some of them can be able to reach their destination, some of them continue their activities moderately and some of them are lost and close their activities. Today we try to discuss the term of business, its form, advantages, and disadvantages of the different forms of businesses separately from my point of view. Generally, a few numbers of trading firms and manufacturing firms are constructed in the form of a partnership firm. 

Partnership Firm:

The firm which constructs with two or more individuals to make a profit by doing business activities through an agreement. Here, the agreement should be written and registered, it's better for the running business operation smoothly. Profit is allocated among the partners according to the agreement mentioned condition or pro-rata basis.  

Keywords: party involvement two or more, profit distribution, written and registered agreement.

Merits:

a.  Less formal roles and regulation with few legal obligations

b.  Easy to start partnership business as like as a proprietorship firm

c.  Easily share the burden to the among partners

d. Access to share knowledge, skills, information, experience, and contacts, etc.

e. Better to make the decision.

f. Easy fund accumulation process which relies on its number of partners

g.  Easy access to profit

Demerits:

a. The business has no independent legal status as like as a proprietorship firm

b. Unlimited liability based on its partners' personal liabilities

c.  Limited access to capital with partners limitation

d. Potential for differences and conflict among the partners

e. Slower, more difficult decision-making

f.  Profits must be shared among the partners

g.  Taxation

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A Sole Proprietorship Firm

A lot of people involved in different types of activities to fulfill human requirements and need. In the case of their involvement, they try to make a profit by performing their activities. People are interested to make a profit and maximize their wealth. But some of them can be able to reach their destination, some of them continue their activities moderately and some of them are lost and close their activities. Today we try to discuss the term of business, its form, advantages, and disadvantages of the different forms of businesses separately from my point of view. Generally, a large number of trading firms and small size business service and manufacturing firms are constructed in the form of proprietorship. 

 Sole Proprietorship:

A sole proprietorship, which is referred to as sole trader, individual entrepreneurship, or proprietorship. It is referred to a form of business which initiates, lead, control, and funded by one person.  Only one person established the business, take all kinds of managerial decisions, and funded all required funds for the business organization. Keyperson of the organization is one who always responsible for all kinds of responsibilities like fund accumulation, organize all business and managerial activities, earning profitability, etc.

Advantages:

a.  Easy to form of a business firm.

b.  Few government roles and regulations to formation and operation a business firm.

c. Involvement of lower-income tax involvement rather than a corporate tax.

d. Easy to make any kind of managerial and business decision.  

 Disadvantages:

a.  Absent of legal business entity as a nature of proprietorship business firm.

b.  Unlimited liability which tracks with personal liabilities.

c. The life of the business is limited to its owner's life.

d. Complex to collect funds to operate business working capital and other required funds.

e. Lower concentration by external financiers due to lack of legal business entity and limited life of business and unlimited liabilities tracking with personal liabilities which create problems to recover debt obligation after death or end of the business firm. 

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