African Honey Bee Micro Franchise Incubator Nov 2012

AFRICAN HONEY BEE
Micro-Franchise Incubator
BUSINESS PLAN
November 2012
By Guy Stubbs
105 Robyn Street
Centurion, 0157, South Africa
Telephone: +27 82 454 1028
E-Mail: guy@africanhoney bee.co.za
Website: www.africanhoney bee.co.za
And whatever you do, in word or deed, do everything in the name
of the Lord Jesus, giving thanks to God the Father through him.
(Colossians 3:17 ESV)
The Agriculture Research Councils Bee-keeping for Poverty Relief Programme states:
Bee-keeping is probably the only form of agriculture with an overwhelmingly positive
impact on the natural environment allowing people to derive economic benefit from
floral resources in a non-destructive way, ensuring local
participation in conservation efforts.
African Honey Bee Business Plan by Guy Stubbs November 2012
2 of 59
PROLOGUE
Khensani Sondlani bee-keeper, Bushbuckridge

1
When Khensani Sondlani joined the African Honey Bee - Bushbuckridge Incubation HUB , she hoped that
this would finally allow her migrant-worker husband the opportunity to come home and be permanently
reunited with his family.
A resident of the poverty-afflicted Bushbuckridge community near the Kruger National Park, South Africa,
Khensanis husband works hundreds of kilometers away in the economic heartland of Johannesburg. He is
able to visit his wife and seven children for only four weeks every year. Khensani has learned how to save
and carefully manage the R800 that her husband sends home each month, but bee-keeping is providing
her the opportunity to move from survival mode to sustaining a successful small business. Should the
business continue to prosper Khensanis husband will be able to come home, in turn allowing their
children to grow up in a stable, dual-parent family.
Khensani has now almost completed her National Qualification Framework Level 1 Learnership in Beekeeping. She owns ten hives and a stand. She often works with Elinah, her neighboring bee-keeper,
because she knows that if the African Honey Bee bee-keepers work together, everyone benefits. Over and
above the income from honey sales, the bee-keepers share a percentage of the revenue.
For Khensani, the next step is to become an African Honey Bee franchisee. Her passion for bee-keeping
has never been in doubt, but now she is confident that she has the expertise to start a commercial-scale
bee-keeping business of 100 hives. And that confidence is strengthened because she knows that her
mentors - African Honey Bee - will support her every step of the way.
For the past 14 months Tshepo, her Incubation HUB Manager, has been teaching her an effective,
revolutionary method of bee-keeping, as well as training and mentoring her. Khensani has been employed
by the Incubation HUB and will graduate to fully-fledged franchisee at the end of her 18 month incubation
period. With the resources of African Honey Bee and its financial partners, Khensani knows she has a good
chance of borrowing enough funds to purchase 100 hives and her own ten stands, a battery-operated
bicycle to service her business and a smartphone tablet to track and communicate her progress.
1 A cluster of bee-keepers living in close proximity to each other.
3 of 59
1. Table of Contents
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
Table of Contents......................................................................................... 4
Appendices .................................................................................................. 4
Executive Summary ..................................................................................... 5
African Honey Bee ....................................................................................... 6
Bee-keeping in Africa ................................................................................... 9
AHB products and services ........................................................................ 12
Marketing ................................................................................................... 16
Innovation and Technology ........................................................................ 33
Operational Plan ........................................................................................ 35
Management and Organization .................................................................. 40
Investment case ......................................................................................... 44
Financial Plan ............................................................................................ 49
Summary.................................................................................................... 58
2. Appendices
Appendix A
Appendix B
Appendix C
Appendix D
Appendix E
Appendix F
Appendix G
Appendix H
Appendix I
Appendix J
Appendix K
Appendix L
Appendix M
why a Christian Social Enterprise

off-take agreements
the AHB Manual
AHB technology and innovation
bee-plant production and carrying capacity
production plan
material requirement plan
organisational chart
ratio analysis
non-quantitative project risks
references
presentation
website
Note: If you are online while reading this business plan and click on any of the
Appendices, you will be directed to that particular appendixs URL. Documents will be
downloaded to your computer. Some web browsers might require that you click on your
right mouse button and select the option Open Weblink as New Document.
4 of 59
3. Executive Summary
There is a critical need for skills, employment opportunities and small enterprise
development in the poorest rural areas of southern Africa. Coincidentally, these

same poor communities have access to prime bee-keeping natural resources that
they are not currently utilizing. There is also a global shortage of honey bee products
that comply with organic and fair-trade standards. The business concept of African
Honey Bee (AHB) taps into this valuable opportunity.
AHB is a Christian Bee-keeping Social Micro-Franchise Enterprise which has
developed a sustainable, commercially-viable business model that enables owneroperated micro bee-keeping businesses (BKBs) to participate in the mainstream
global organic and fair-trade honey markets.
Break-even is achieved in year two by the establishment of Incubation HUBs
comprising 2000 hives per HUB, each HUB employing and incubating ten beekeepers over an 18-month period. When each of the ten bee-keepers has been
established as a franchisee, a further ten are recruited and incubated. When critical
mass has been reached in an area, incubators can be relocated to other rural
poverty nodes.
After break-even has been achieved, the business continues to grow exponentially
with every new hive that is added. Strong cash flows at both the levels of AHB (the
franchisor) and the BKBs (the franchisees) make the AHB franchise model eminently
suited to rapid expansion. Replication of the model to other regions in South Africa,
and potentially to other African honey-producing areas, is unlimited.
Two types of investment opportunity exist per Incubation HUB:
o 1 x R 5 M (US$ 625 K) Quazi-equity2/grant/loan is required for establishing a selfsustaining Incubation HUB that incubates a minimum of 40 BKBs.
o 40 x R 140 K (US$ 17.5 K) soft loans3 are required to establish at least 40 BKBs.
The investment opportunity offered by AHB is unusually attractive in that it is a
commercially viable project that also enables blended-value impact investors4 to
contribute actively to promoting a more sustainable economy, preserving
biodiversity and uplifting society in a way that glorifies God. In particular this project
is a unique opportunity for public or private investors with a sustainable poverty
alleviation objective.
AHB is looking for partners that can provide funding (possibly in combination with
other support such as logistics, business mentorship, access to market and
marketing knowhow).
This project scores very highly in terms of: sustainable micro-enterprise
development; capacity-building; poverty relief; promotion of organic agriculture;
development of new accreditation standards; conservation of the natural
environment; enhancement of agriculture through pollination; creation of new niche
export markets; and marketing to the triple-bottom-line consumer market.
2 A category of debt taken on by a company that has some traits of equity, such as having flexible repayment options or being unsecured.
3 18 month holiday, repayment in 3 years at 6% interest.
4 Investments made with the intention to generate measurable social, and environmental impact alongside a financial return.
5 of 59
4. African Honey Bee

Enterprise description
AHB is a Christian Bee-keeping Social Micro-Franchise Enterprise.
Foundation
AHB is a Christian-based enterprise that follows the Biblical admonition: If a brother or
sister is poorly clothed and lacking in daily food, and one of you says to them, Go in
peace, be warmed and filled, without giving them the things needed for the body, what
good is that? So also faith by itself, if it does not have works, is dead5.
More detail can be found in Appendix A.
Mission Statement
To alleviate both spiritual and physical poverty through bee-keeping, by enabling poor
rural families to profitably benefit from the natural resources available on their
doorsteps in a way that witnesses Gods glory.
Vision
As a witness to Gods glory, AHB has a vision of catalysing a network of thousands of
viable community-based, self-sustaining micro bee-keeping businesses spread across
southern Africa.
Goals and Objectives
To help train and equip Incubation HUBs of no less than 40 owner-operated bee-keeping
businesses per geographic locality, each HUB is:
To produce and sell 72 tons per annum of accredited organic, fair-trade table honey,
72 tons of organic, fair-trade industrial honey and 7.2 tons of organic, fair-trade
beeswax.
To establish these HUBs through first establishing commercially viable Incubators.
To incubate ten new bee-keepers per Incubation HUB every 18 months.
To build up a minimum of 40 BKBs per HUB, each to a level where they are farming
with 100 hives.
To create a minimum of 5 jobs6 per BKB i.e. 200 jobs per HUB.
To empower each HUB to lifting 2000 rural poor people7 above the poverty line with
approximately R 5 M injected into the local rural economy per HUB annually.
To continually develop and refine a field- and market-proven, scalable business
model as well as the project modus-operandi for commercial roll-out across
southern Africa.
To apply Gospel-based principles to the entire enterprise and thereby witness Gods
glory to those that are seeking.
5 (James 2:15-17 ESV)
6 Each BKB could employ 4 family members and provide work for 1 ancillary business/service provider.
7 Income earners support on average 10 people in South Africas rural poverty nodes (StatsSA 2007)
6 of 59
Market
AHB has 2 markets:
The Franchisee AHB sells a complete business in a box franchise to the
franchisees, enabling them to become fully established BKBs.
The honey bee product buyer this market can be broadly divided into
o Retailers and
o Raw Materials Supply Chain Partners
AHBs capacity to deliver
AHB has been building a team of financial, technical, legal and marketing experts with a
passion for social development matched by decades of proven real-world expertise.
Guy Stubbs AHBs founder is a Christian Social Entrepreneur who has been involved in
social development for more than 25 years and has developed specialist expertise in
developmental bee-keeping. Guy started bee-keeping in 1981. He is also an
internationally award-winning photographer with a long track record in social
development, agricultural and environmental issues. He is currently finishing the Regent
Christian Social Entrepreneurial MBA programme (USA).
Martin Johannsmeier AHBs senior bee-keeping advisor is a renowned bee-keeping
and bee-plant expert who has published many articles, and edited, authored and
contributed to many globally recognized bee-keeping publications. In addition to
advising AHB, he has edited the AHB manual and provided research on the bee-plants in
Bushbuckridge.
Sidwell Banne AHBs development bee-keeping advisor is the owner of the wellknown Honeybadger shop and training centre. Sidwell is a distinguished bee-keeping
development specialist who contributed 30 years to development bee-keeping at the
Agricultural Research Council. In 2005, Sidwell was one of only 4 bee-keepers awarded
the prestigious IH Wiese Bee Researcher of the Year trophy by the South African Bee
Industry Organization, in recognition of his outstanding achievements and commitment
to bee-keeping development in South Africa.
Kobus Visser AHBs operations and training manager holds a B.Sc. in Construction
Management. Kobus has an impressive history of project management, financial
management, Not for Profit Organization management and entrepreneurship. He has a
particular skill for finding creative, practical solutions in challenging situations.
Andrew Weeks AHBs legal and knowledge transfer expert is a Cape Town-based
commercial lawyer with experience in business development, consumer law, plain
language contracts and intellectual property as well as social, environmental and
agricultural issues.
7 of 59
The five driving forces that work to support the AHB model
1. The social dynamism: Rural people subjected to poverty and (to earn an income), a
life of migrant labour8, will now be able to live and work at home, and so the family
structure is re-established.
2. The technical dynamism: The Afri-hiveTM and NektarTM technologies enable rural
African farmers to improve and share their knowledge. By combining the best of
African and Western forms of apiculture and cutting out expensive infrastructure,
resources, systems and technology, bee-keepers are once again able to run
commercially viable businesses. Cell phones have also revolutionised rural life. Roy
Brander refers to the cell phone as a poor mans computer.9 Louis Liebenberg
developed a technology called CyberTracker to enable illiterate bushmen to
transfer ecological data gathered from animal tracks (that only they were able to
read) to researchers computers via hand-held devices. This data is translated into
information and intelligence to manage wildlife preservations10. James Canton
confirms AHBs strategy that convergence of leading-edge technology will be the
single most powerful driver of change for the next 100 years.11 The most exciting
aspect of the cultural fusion taking place through technology is not so much the
consumers access to precise information about what he/she is eating, but the
consumers reconnection with the producer via social media. The concept of the
village market is back on a global scale and the personal relationship between the
consumer and the farmer is being restored. This time, however, it is via cyber
space.
3. The economic dynamism: As discussed later, poverty in rural South Africa is
extreme. According to Silimela Development Services families earn less than R 456
per month12. The AHB model enables these same families to earn R 6000 per
month13; a substantial 1500% increase. Because these families spend 90% of their
income locally,14 the model has a knock-on positive effect of benefitting and
stimulating the local economy.
4. The environmental dynamism: Rural African communities benefit because through
the AHB model and access to the natural resources on their doorstep, they develop
a respect for the environment. Bee-keeping is the only form of agriculture without
a negative effect on the natural environment.15 Landowners benefit because the
communities who use the land for bee-keeping develop a respect for it and
become its guardians.
8 Someone who migrates within a country, possibly their own, to pursue work. (Deshingkar and Grimm 2005)
9 (Brander 2008)
10 (CyberTracker 1998)
11 (Canton 1999)
12 (Silimela Development Services 2009)
13 Each BKB has 100 hives x US$108 earned annually
14 (Hanlon 2010)
15 Quoted by the South African Agricultural Research Council (ARC 2001)
8 of 59
5. The political dynamism: By involving producers and consumers in the Global

Village Market through innovative communication, technology, business systems
and trade, political barriers are broken down and a global sense of Ubuntu16 is
established. Julius Nyerere, the first president of Tanzania, developed the concept
of Ujamaa a person becomes a person through the people or community.17
Marvin Cetron & Owen Davies refer to this global trading relationship as a
benevolent cycle.18
5. Bee-keeping in Africa
The African honey bee
The African honey bee (Apis mellifera scutellata) is a subspecies of the Western honey
bee. It is native to central and southern Africa, though at the southern extreme it is
replaced by the Cape honey bee, Apis mellifera capensis. This subspecies has been
determined to constitute one part of the ancestry of the Africanized bees (also known as
"killer bees") spreading through America. The African bee is being threatened by the
introduction of the Cape honey bee into northern South Africa. If a female worker from
a Cape honey bee colony enters an African bee nest, she is not attacked, partly due to
her pheromone resemblance to the African bee queen. Now independent from her own
colony, she may begin laying eggs, and since A.m. capensis workers are capable of
parthenogenetic reproduction19, they will hatch as "clones" of herself, which will also lay
eggs. As a result the parasitic A. m. capensis workers increase in number within a host
colony. This leads to the death of the host colony on which they depend. An important
factor in the death of a colony seems to be the dwindling numbers of A. m. scutellata
workers that perform foraging duties (A. m. capensis workers are greatly underrepresented in the foraging force of an infected colony). When the colony dies, the
capensis females will seek out a new host colony20.
Honey production in Africa
Tropical honey production differs from temperate honey production in several aspects.
The type of honey bee is different from the type used in Europe, Asia, and the Americas.
Also, the flowers and plants on which the honey bee feeds may be different. Moreover,
the climate, geography and management practices of honey production may be
different and all have an influence on the quality and quantity of honey produced.
Owing to the lack of a clear winter season in tropical climates, the period in which the
beehives are in production is often longer than in temperate climates. The honey bees
do not have to produce honey for a winter season in which food is not available in
sufficient amounts. But in areas with a long dry season, the production of honey may be
lowered by the limited availability of food for the honey bees. In tropical apiculture,
there are many types of beehives. In Tanzania and Zambia, the most common hives are
16 Ubuntu, is an ethic or humanist philosophy focusing on people's allegiances and relations with each other (Gade 2011)
17 (Nyerere 1967)
18 (Cetron and Davies 2010)
19 A form of asexual reproduction in which growth and development of embryos occur without fertilization.
20 (Martin, Beekman, et al. 2002)
9 of 59
made from split logs, which are placed in trees to attract the bees. These log hives may
be left unattended for most of the year. This form of bee-keeping is often called semicontrolled bee-keeping21.
Most African honeys are polyfloral, because most African countries have a large variety
of plants. The plants the honey bees feed on strongly influence quality aspects such as
color and taste. This is especially the case for forest honeys, which often have a strong
taste and a dark color. These honeys may also contain a larger amount of pollen, which
has an additional effect on taste. In East Africa, it is a common practice to use smoke to
chase the honey bees from their hives before harvesting the honey. The result is a
honey with a smoky flavor, which honey processors and consumers often do not
appreciate22. These smoky honeys are generally not suitable for table honey, but they
can be used in the industry after being mixed with odourless honey. However, one
importer, Tropical Forest Products from the United Kingdom, markets these smokeflavored honeys as a specialty.
The different climate and management practices in tropical regions pose several
problems for the production of quality honey. Bees can regulate the moisture content of
their honey, but in humid climates they may not be able to reach sufficiently low values
for the honey to be used as either table honey23 or industrial honey24. With simple
management practices like the placement of hives in ventilated places, significant
improvements may be obtained.
High temperature may also affect the quality of honey. The HMF
(hydroxymethylfurfural) content, which is an important quality parameter, is directly
related to the temperature during production, storage, and transport. The HMF content
rises with the temperature. Results from Chile, Guatemala, and Zambia show that, using
proper practices of temperature control, the HMF content can be controlled 25. The
standards for the European Union regarding maximum HMF contents are in Council
Directive 2001/110/EC. In general, HMF content may not be more than 40 mg/kg,
except for industrial honey (limit not specified). An exception in the maximum content
of HMF is made for honeys from regions with tropical climates. For tropical honeys, the
maximum content is 80 mg/kg. However, honey traders use stricter rules than the
legislation requires. They usually do not base the permissible HMF content on the origin
of the honey, but on the intended use of the honey. Honey traders often apply a norm
of a maximum 10 mg/kg for table honey. The maximum HMF content for industrial
honey may be as high as 40 mg/kg.
21 (Sommeijer, et al. 1997)

22 (Koekoek, F; van Loon, M; 2006)
23 Honey intended for consumers, to be eaten directly or as a natural sweetener for drinks or in cooking
24 Honey that is used as an ingredient and does not meet fully all the criteria for table honey and is therefore regarded, according to the EU criteria, to be of lower quality than table honey. It still
however qualifies for use in the food industry, for the manufacture of bakery goods, confectionery, breakfast cereals, sauces, tobacco, and products such as honey-roasted nuts as well as
pharmaceutical and cosmetic products.
25 (Koekoek 2007)
10 of 59
The bee-keeping industry in South Africa

The South African Bee-keeping industry is relatively small both in global terms and in
terms of the overall South African agricultural sector. South Africa was the 64th largest
honey producer in 2006, producing a mere 0.11 percent of world production (1500
tons). The direct value of honey bees in South Africa (only considering honey bee
products) is estimated to be in the region of R 100 M with total direct employment in
the region of approximately 3000. There are only 20 or so professional bee-keepers and
150 commercial bee-keepers in South Africa26.
Honey bees are, however, critically important for agriculture and conservation. This
importance far exceeds the value currently derived from honey bees by bee-keepers. It
has been estimated that managed honey bee pollination adds a value in the region of
R 189 M - R 828 M per annum to the South African deciduous fruit industry alone. This is
16 - 69 times the amount (R 12 M) that bee-keepers presently receive for this service.
The sub-tropical oilseed, vegetable seed, berry and cut flower industries (as well as
certain other fruits and vegetables such as squash and melons) are also to a very large
extent dependent on pollination services provided by the bee-keeping industry. The
estimated value added by honey bees would further increase if the pollination by honey
bees of garden plants, exotic plants and indigenous plants is considered. It is estimated
that honey bees are pollinators for approximately 60% of flowering plants in South
Africa. Honey bees and the wild honey bee population are therefore also vitally
important in the conservation of floral reserves and in terms of biodiversity. It has been
said that bee-keeping is possibly the only form of agriculture with an overwhelmingly
positive impact on the natural environment27. Commercial bee-keepers on their own are
not capable of providing all the necessary funding and infrastructure to support and
sustain the honey bee population in South Africa, considering its relative importance to
other industries and to the country as a whole (in terms of conservation and
biodiversity). Support would also be required from all those that derive value from
honey bees, including the government35.
This is especially relevant when one considers the overwhelming challenges facing the
South African bee-keeping industry. A review of the South African bee-keeping industry
at the end of the twentieth century by Schehle (1996) summarized in Johannsmeier
(2001), found that these challenges included:
shortage of honey, leading to supplementation by imports
high unemployment, increasing theft of hives to 20% of the total number
still no solution to the Cape bee problem
increasing bee losses due to pesticides on crop plants
cost and inefficiency of traditional night work with bees
rocketing fuel prices
lack of knowledge about bee disease identification and control
mutual mistrust among bee-keepers
26 (NAMC Report 2009)
27 (ARC 2001)
11 of 59
Two positive aspects were highlighted:

With available natural resources, the industry could expand to twice or three times
its present size.
Honey produced in South Africa was of high quality and could easily compete against
other honeys on the world market.
Honey processing
The processing of honey comprises the separation of honey from the comb, cleaning,
mixing, and packing of the honey. The processing of the honey is best done at room
temperature, since this preserves the natural characteristics of the honey. The
processing of honey has a substantial influence on the quality of the final product.
Good, hygienic standards have to be applied throughout processing, packaging, and
storage to prevent contamination of the honey. The moment of harvesting is critical to
the quality of the honey. The honey is ready for harvesting when it has had sufficient
time to ripen. During ripening, the chemical composition of the honey changes and the
moisture content decreases. When the honey is ripe, the cells are sealed off. Unripe
honey has a high moisture content, which makes it vulnerable to fermentation. Old
honey has been in the honeycomb too long and may have deteriorated. Exposure of the
honey to high temperatures should be avoided, since it increases HMF content. As
explained earlier HMF forms naturally in honey over time by the breakdown of fructose,
a process that accelerates as the temperature increases. HMF, however, is not harmful
to human health.
Honey contains natural preservatives added by bees. When honey is properly stored in
airtight containers, it enjoys an almost indefinite shelf life. But when honey is exposed
to heat and moisture, its quality can deteriorate quickly. The shelf life of table honey can
be lengthened through heat treatment (pasteurization). This treatment should be
performed with caution, since the heat also results in deterioration of the quality (HMF
content).
6. AHB products and services

AHB has two types of product
The Franchise AHB sells a complete business in a box franchise to franchisees,

enabling them to become fully established BKBs. This product includes: incubation
(training & mentorship); access to innovative technology and knowhow; logistical
support; and most importantly, access to premium markets.
The honey bee products these products are the produce of the enterprise and
include honey, beeswax, pollen, propolis and royal jelly.
This chapter focuses on honey bee products. The franchise is discussed in the sections
on production (section 9) and human resources (section 10).
12 of 59
Honey
Bees produce honey from the nectar of blossoms or secretions of plants. The bees
collect the nectar and secretions, which are transformed and combined with other
substances and stored in honeycombs to mature. Honey has a complex composition.
The main ingredients are fructose, glucose, and water. It may also contain other sugars
such as sucrose, maltose, and melitose (and other oligosaccharides). In addition it
contains enzymes, minerals, vitamins, and amino acids. Honey may also contain
impurities such as traces of fungi, algae, yeasts, and solid particles that have come loose
during processing28.
There are many types of honey. Honey may be categorized by the origin of the nectar or
the method of processing and presentation. The categories below are taken from
Council Directive 2001/11/EC29 relating to honey, which describes the conditions under
which honey may be placed in the EU market as follows:
By origin
Blossom honey - obtained predominantly from the nectars of flowers
Monofloral - single botanical source
Polyfloral - Several botanical sources
Honeydew honey - obtained from the secretions of plants
By type of processing
Comb honey - honey is still contained in the combs and is presented and sold as
such. The comb and the honey are edible.
Chunk honey - containing one or more pieces of comb honey
Drained honey - obtained by draining decapped, broodless combs
Extracted honey - obtained by centrifuging decapped, broodless combs
Pressed honey - obtained by pressing broodless combs with or without
application of moderate heat
Examples of monofloral honeys are clover, acacia, and sunflower honey. Blossom and
fruit-blossom honey are examples of polyfloral honeys. Forest honey consists of
honeydew, the term for all non-nectar secretions of trees and plants collected by
bees.
Honey may be liquid, solid, or creamed. The flavor, aroma, and color of honey depend
on the nectar source visited by the bees. The color may vary between nearly colorless to
dark brown. Most honeys offered in retail are blended, but in the specialty retail stores,
there is a wide variety of single-origin honeys.
Both the food industry and individual consumers are major end-users. Honey intended
for direct consumption is called table honey. Honey used for further industrial
28 (CBI 1999)
29 (European Union 2005a)
13 of 59
processing is called industrial honey or bakers honey. The criteria for table honey are
stricter than for industrial honey. Therefore, honey that does not meet the criteria for
table honey may still be used as industrial honey30.
Honey has some applications in medicine. It has an antibacterial property which has not
been fully examined yet. The antibacterial activity of honey is primarily related to
hydrogen peroxide generated by the action of an enzyme added to the nectar by bees.
The hydrogen peroxide cleans and dehydrates the wound and thereby promotes
healing31. For that reason, honey is incorporated into bandages for treating wounds
resulting from burns.
Beeswax
Beeswax is a natural animal wax produced by various species of honey bees. The wax is
secreted by four pairs of glands on the worker bees. Bees use the wax to construct cells
and cappings in the comb in which the honey is stored. Beeswax is extracted from old or
damaged combs and is therefore a by-product of honey production.
Beeswax has several chemical properties that are unique and highly appreciated by
certain industries. Beeswax is a very stable substance that resists oxidation; it is soluble
in water and is barely affected by acid. The composition of beeswax is very complex; the
industry has not been able to produce a substitute with equal properties. Although
many synthetic waxes are available today, beeswax remains irreplaceable in many
industrial applications.
Beeswax is used not only by the bee-keeping industry, for the production of
honeycombs, but also by the pharmaceutical and cosmetics industry, in candle-making
and for the production of polishes and varnishes32. Compared to the market for honey,
however, beeswax is a minor market.
Propolis
Propolis is a substance collected by bees from the buds and leaves of plants. This
substance, which resembles resin, is used to fortify and seal the beehive to protect it
against external influences such as infections. Several health claims have been made
about propolis. Like honey, it contains a natural antibiotic which is used in treating
wounds. It allegedly increases resistance to disease and promotes general well-being.
Propolis is sold in capsules, tablets, granules, tinctures, and ointments.
Royal jelly
Royal jelly is a white secretion from certain glands of nurse bees. It is the food of the
queen bee. Royal jelly is reputed to have powerful beneficial effects. It is thought to
30 (CBI 2005b)
31 (Waikato Honey Research Unit Honey 2005)
32 (FAO 1996)
14 of 59
increase stamina and performance, increase the appetite, and accelerate recuperation
after illness. None of these claims has been substantiated by medical research.
Pollen
Pollen is the male reproductive cell of plants and is collected by honey bees. Pollen has a
high content of a variety of vitamins, minerals, and amino acids. Similar beneficial claims
are made for pollen as for royal jelly. Pollen is sold in tablets or as granules.
The use of bee products for medicinal uses is called apitherapy. The benefits of bee
products for human health are poorly substantiated by scientific research or other
evidence. In spite of this, for centuries bee products have been prescribed for treating a
wide variety of health problems.
More information on bee products and their characteristics and applications can be
found in the Food and Agriculture Organization of the United Nations (FAO) publication
Value-added products from bee-keeping33.
The opportunity
Owing to global industrialisation, pollution has spread through the developed and
developing world. Africa, largely because of political instability, remains the least
developed continent and therefore the least polluted continent34. Because of communal
and government-owned land, rural Africans have effectively become the largest land
owners. As an example, in South Africa the State is the largest landowner and in the
post-Apartheid reconciliation process has, where possible, given the rural, previously
disadvantaged, poor access to land for social development.
According to Haike Rieks, Since the early 1960s there has been a rising market in
Europe, Japan and the USA for products grown in a sustainable manner and without the
use of agro-chemicals. The organic market has grown from US$ 13 billion in 1998 to
US$ 30 billion in 200735. This is due to the increasing environmental concerns of
consumers in these developed countries. As such, they are willing to pay premium
prices for certified organic products. Slowly but surely, governments, as well as
development cooperatives, are recognizing the contributions that organic agriculture
can make to environmental, health, bio-diversity and food security issues. Mathaba
News estimates that with one-quarter of the world`s arable land, the African continent
has the potential not only to feed its people but to become the breadbasket of the
world.36
33 (FAO 2010)
34 (UN 2010)
35 (Rieks 2007)
36 (Mathaba 2010)
15 of 59
Consumers - developing versus developed countries

The gap between consumer trends in developing and developed countries continues to
widen. According to Pick n Pay, South African honeys main retail competitor is Golden
Syrup, even though two thirds of the honey consumed is imported, dumped37 Chinese
honey, (not accepted for import by the EU because of its dangerous residues38).
Consumers in South Africa are generally not interested in the origins of their sweetener,
only the price. By contrast, consumers in Europe, Japan and North America are no
longer hoping for safe food, they see it as a prerequisite39. Discerning, conscious
consumers want to be able to trace the taste of their food40. They need to know not
only that their food is safe, but also that it is a) benefitting (or at least not being
detrimental to) the natural environment, b) benefitting the producers in a social
uplifting way and c) creating economic development.
By 2012, it has become unviable to produce honey in South Africa for the local market.
Meanwhile, because of CCD (Colony Collapse Disorder41), North America has lost nearly
30% of their bees, in parts of China farmers are having to hand-pollinate fruit trees
(because the honey bees have been wiped out42) and Europe, Japan and the US are
virtually no longer able to produce their own organic honey43. There is a general global
shortage of honey.
7. Marketing
Product Goals & Strategic Objectives
AHB has a goal to produce super-healthy, premium grade, organic, fair-trade, BRC44
(British Retail Consortium) accredited, fully traceable honey bee products at competitive
market prices (i.e. without the surcharges usually charged for traditional fair-trade
products). Most importantly, products of this nature will result in client loyalty because
customers will experience a tangible relationship with the producers: they will be able
to see exactly what they are eating, trace where it comes from and who made it, and
establish what the health benefits are.
Marketing Objectives
As explained earlier, although AHB recognizes that one of its products is the franchise,
it doesnt market its franchises as yet. This chapter therefore focuses on the marketing
of honey bee products.
37 No longer accepted into the EU, honey is dumped in Africa where governments are less quality stringent (Shneider 2011).
38 In February 2002, the world honey market was strongly affected by an EU ban on Chinese honey, following the identification of antibiotics in samples of Chinese honey. (FAO 1996)
39 (GlobalGap 2010)
40 (Harrewyn 2011)
41 A phenomenon in which worker bees from a beehive or European honey bee colony abruptly disappear. (USDA 2012)
42 Maoxian County of Sichuan, China lost it pollinators through the indiscriminate use of pesticides and the over-harvesting of its honey. The result is that hand pollination of pear and apple
trees has become a common practice. (Buzzle 2010)
43 The production of organic honey in [Japan, USA and] Europe is limited. The main reasons are the presence of; and treatment of; the varroa mite, the lack of unpolluted areas, and cold winters.
(Koekoek, F; van Loon, M; 2006)
44 The BRC Global Standards are industry-leading Technical Standards that specify requirements to be met by an organisation to enable the production, packaging, storage and distribution of
safe food products (BRC 2012).
16 of 59
Partnering with key retailers table honey

Rather than selling product directly to market, AHB prefers to establish and nurture
relationships with key retailers on a partnership basis. AHB will focus on partnering with
South African and European retailers that place emphasis on a more discerning, ethical
consumer. A partnership directly with a retailer could eliminate unnecessary waste
caused by distribution middlemen, enabling the retailer to price organic, fair-trade
honey competitively.
AHB is looking for retailers that share:
the same values,
an appreciation of the need for sound economic business practices which include
taking the social, ethical and environmental bottom-line into account,
similar principles on three pillars:
o sustainable products & services,
o resource efficiency & climate protection, and
o producers, employees & society.
Partnering with raw materials supply chain partners
Honey bee products are used as ingredients in food, cosmetics and pharmaceutical
products. Of the 10 K tons of honey consumed by Switzerland each year, 9 K tons of the
honey is used as ingredients 45. Large supply chain raw material agents like Varistor ag46,
develop relationships with producers to supply their clients honey bee products. It is
AHBs objective to partner with such agencies.
Selling product
Initially product will be limited to organic, fair-trade table and industrial honey and
organic, fair-trade beeswax. Over time the product range will increase to include
propolis, pollen and royal jelly. Because AHB will be selling through supermarket
retailers and raw materials supply chain partners, its product-selling marketing strategy
will be one of support to the merchants rather than one of direct sales. This section
primarily focuses on this approach.
Market research
Lifestyles of upper middle income groups are similar in South Africa to those of
professionals in other developed countries, i.e. working couples with two or three
children, with nutritious eating habits and a demand for nutritional variety. Durban,
Johannesburg and Cape Town have substantial Muslim and Jewish populations and thus
require halal47 and kosher48 products. During 2010, kosher honey was Pick n Pays49
best-seller50 a good example of how important it is to understand psychographics.
45 (Heller 2011)
4646 (Varistor 2012)
47 Halal is a term designating food which is permissible to use according to Islamic law (Kalamullah 2012).
48 Kosher foods are those that conform to the regulations of the Jewish Halakhic law framework, kosher meaning fit or allowed to be eaten (Jewish Encyclopaedia 2012).
49 The Pick n Pay Group is one of Africa's largest and most consistently successful retailers of food, general merchandise and clothing. (Pick n Pay 2010)
50 (Swanevelder 2010)
17 of 59
Consumers chose kosher over conventional honey, assuming that because it had been
blessed by a Rabbi51 it was healthier, safer or cleaner.52 The Zion Christian Church (ZCC)
church, (over 20 M members also with strict dietary laws) are a good example of a
massive untapped potential market for unadulterated honey53.
The EU accounts for approximately 20-25% of the worlds honey consumption. In 2007,
consumption amounted to 310 thousand tons. Consumption figures for the period
2003-2007 show strong fluctuations in terms of value. The fluctuations were caused by
large price variations. However, figures on volumes and industry sources indicate that
real consumption was stable. Due to the maturity of the market, consumption of
conventional honey (i.e. not value added such as organic, fair-trade accredited) is not
expected to show enormous growth in the coming years. Increased interest in a healthy
lifestyle maintains consumer interest in conventional honey, but does not lead to a
significant growth in conventional honey sales. In contrast and as discussed later,
organic, fair-trade honey consumption levels are rapidly increasing. Interestingly the
economic crisis has had little effect on honey sales. Consumers in the EU continue to
purchase honey, as they regard honey as a basic food product54. In general, the honey
market is a very stable market. Nevertheless, the market is still evolving. Market shares
of monofloral and single-origin honeys are increasing and increased concerns about the
effects of intensive farming on the countryside, as well as on the environment in
general, have also intensified interest in organic honey. European bee-keeping is
severely threatened by varroasis and the Colony Collapse Disorder. Both diseases lead
to decreases in the number of bee colonies and reduced honey production. They also
affect the profitability of bee-keeping55. Furthermore in 2011 the EU placed a ban on all
GM-contaminated honey56.
Industry Trends
As a consequence of growing concerns about food safety, upper middle income
consumers and other stakeholders are demanding a quality guarantee. Food quality
requires transparency throughout the supply chain. Traceability records all stages of the
supply chain and therefore adds value to the quality and safety.
Consumers are becoming more interested in healthful and natural food. Honey is a
natural sweetener that contains health-promoting ingredients such as vitamins,
minerals and amino acids and is therefore considered better than refined beet or cane
sugar. Although honey has many flavors, mono-floral types are becoming more popular
and consumption growth is expected to increase dramatically57.
51 In Judaism, a Rabbi is a teacher of Torah (Jewish Encyclopaedia 2012).

52 (Harrewyn 2011)
53 (ZCC 2010)
5454 (SA Food & Drink Report 2010)
55 In contrast, South African bees are more robust and not effected by either disease (Martin and Medina 2004).
56 (Phillips 2011)
57 (CBI 1999)
18 of 59
While some consumers are becoming more concerned about the safety of food, in
South Africa there is a trend for consumers to turn away from expensive products such
as honey. Here Golden Syrup is honeys greatest competitor58.
EU imports of honey amounted to 375 M in 2007. Imports fluctuated significantly
between 2003 and 2007. In terms of volume, imports actually increased by an average
of 1.7% annually to 215 thousand tons. Global prices of honey fluctuated as a result of
import bans on honey from several countries, such as China and Brazil, and weather
conditions. The bans have been lifted again. However, bad weather conditions keep
honey quantities available for import to the EU small. Nevertheless, EU importers
continue to buy honey, though at higher prices.
The largest EU markets for imports of honey from developing countries are Germany,
the UK, Spain, Italy, Belgium and France. Developing countries together supply 41% of
total EU honey imports. Argentina is the leading supplier to the EU. However, the value
of supplies from Argentina decreased significantly in the period 2003-2007 and, in 2008
and early 2009, supply volumes decreased sharply. Consequently, other developing
countries have profited from the developments in Argentinean honey supplies59.
Exports of honey to the EU are restricted to countries which are on the so-called third
country list. The list states the extra-EU countries which are allowed to export honey to
the EU (2001/158/EC). Countries not on the list are not allowed to supply honey to the
EU. To be on the list, a country should have a Residue Monitoring plan for the analysis of
residues of antibiotics, sulphonamides, pesticides and heavy metals. 60
Germany is by far the leading EU market for honey, with consumption amounting to 96
thousand tons in 2007 (30% share in the EU). The other major consumers of honey in
the EU are the United Kingdom, France and Spain. Per capita consumption differs
greatly between EU countries. In 2007, per capita consumption in Greece was 1.6 kg,
while in Italy it was only 0.3 kg61.
As discussed, the honey market is principally segmented into honey for household
consumption and honey for industrial use. Table honey is used mainly as a spread on
bread, and some is used as a natural sweetener for drinks such as tea or milk. It can also
be used in food preparations such as salads, vegetable and meat glazes and casserole
dishes. The other major market segment for honey is the food industry. This industrial
honey is mainly used in the bakery, confectionery and cereal industries. It is particularly
useful in baked goods. The moisture-absorbing quality of honey helps breads, cakes,
cookies and candies stay fresh longer. Finally, honey also has a use in honey wine and
several after-dinner liqueurs. Honey was traditionally used in food preparations, but is
60 South Africa is currently not on this list because export activity became extremely low in recent years. Action is being taken by AHB and the South African Department of Agriculture to rectify
this. The process is not so much a question of whether permission will be granted but what the costs of testing will be to meet the required expectations. AHB is however confident that due to the
global deficit in honey, honey of the quality to be produced by the venture will be welcomed into Europe with little hindrance (Allsopp 2012).
61 (CBI 1999)
19 of 59
now often replaced by sugar and sugar syrups. The honey which is used by the food
industry is often of a lower quality than the honey used by households.
Consumer preferences for honey show many similarities between countries. In general,
EU consumers have a preference for light-colored, clear, liquid honey with a mild taste.
Honey packers in the EU blend honey from mixed sources to create honeys with such
properties and an acceptable price. The honey used in the blends is polyfloral honey.
The market for monofloral honeys is small (estimated at less than 10%). The ratio
between liquid honey and creamed honey differs strongly between countries. Most
Belgians and Finnish consumers prefer creamed honey, while most consumers in The
Netherlands prefer liquid honey. Consumption of darker and stronger honeys is often
related to the domestic production of forest honey. Where forest honey is a traditional
product enjoying wide acceptance, consumption of darker and stronger honeys is more
common. In the more developed markets, offering wide assortments, darker and
stronger honeys are also more common62.
Organic
An estimate of the total market for organic honey in Europe in 2007 was around 6.5
thousand tons per year (i.e. 2% of the total honey market at the time). Germany
accounted for 2.5 thousand tons of the EU consumption of organic honey. Organic
honey is mainly used as table honey. Consumers of organic and health foods mainly use
honey as a natural, nutritious alternative to sugar and for flavouring in cooking. It is also
used by many consumers as a natural medicine. Although scientific research has not
been able to confirm many of the claims on the medicinal properties of honey, there are
many people who believe in it. Consumers are willing to pay a higher price for a product
such as honey, when it is organic63.
Fair-trade
The fair-trade segment consists of consumers who are socially conscious and are willing
to pay a higher price for products that are fair-trade accredited. The fair-trade global
honey market reached 1.7 thousand tons in 2007 and is growing steadily, the leading
consumers being Germany, Switzerland and the UK. The EU market for fair-trade honey
amounted to 1.1 thousand tons in 2006. The largest market is Germany, with sales
amounting to 438 tons in 2006. The UK is the second largest EU consumer and shows a
large growth, as sales increased from 101 tons in 2003 to 322 tons in 2006. Other
emerging fair-trade honey markets are France and Denmark64.
Natural health food
EU consumers are increasingly interested in a healthy lifestyle and, consequently, in the
consumption of health food. Health food refers to food products which are low in fat or
even have calorie-burning properties and which have limited sugar and salt content.
This includes functional foods, which have specific health-promoting properties (e.g.
62 (CBI 2005b)
64 (Seufert 2010)
20 of 59
antioxidants) and food products with added vitamins and minerals, or bacteria
supporting the intestinal function. The increasing awareness of the importance of diet
and nutrition, particularly among Western European consumers, has been accompanied
by increasing concerns about the safety of food. Recent food scandals and critical food
research have led to a negative image of synthetically manufactured food ingredients.
Together with a higher appreciation of products from nature and a growing
environmental consciousness, this has made natural products more popular.
Honey fits in well with the natural health trend. It is a completely natural product which
has several health-promoting properties. Nevertheless, honey consumption does not
expand under influence of the health trend. Honey has always been appreciated for its
natural origin and its therapeutic as well as medicinal properties. The health trend reemphasizes the value of honey and strengthens sales to existing consumers, but does
not cause significant increases in total sales. It mainly helps to prevent substitution of
honey by other bread spreads and sweeteners, such as jams, which are continuously
improved and for which the assortment continues to expand65.
Monofloral honey
Monofloral honeys, such as acacia, are becoming more popular in the EU. Especially in
the leading EU markets, demand for these monofloral honeys is increasing at the
expense of blended honeys. The largest growth in consumption is expected for these
types of honey. However, there are significant differences in consumer habits and
preferences in the various EU countries66.
Adding value
Because African honey producers have developed a bad reputation (due to deficiencies
in quality and supply), a strong quality focus is important to overcome the hesitation of
importers. Successful exports will require presenting a strong value proposition to
customers, based on aspects such as taste and appearance, botanical origin, production
method (organic/fair-trade) and service delivery. Honey with a good story, such as
fair-trade, will sell well in countries such as Germany, Switzerland and the United
Kingdom. Marshall points out that South Africa has the potential to become an
important exporter to the European Union67. Currently, South Africa exports no honey
at all.
In South Africa, the value-added food market is benefitting from the booming middleclass and will continue to reap benefits in the future as well. The middle-class cultural
values determine how consumers look at benefits of products and individual needs,
wants and desires68. Ethical honey offers many benefits. It is safe, clean and
unadulterated; it is beneficial to human health and the environment; its production is
traceable and it helps to alleviates poverty.
65 (CBI 1999)
67 (Marshall 2010)
68 (Association for Consumer Research 2012)
21 of 59
Industry analysis
Demographics of target market segment
South Africa has one of the most skewed income distribution patterns in the world, with
the top 10% of the population accounting for 47% of consumption or income. A market
segmentation tool in South Africa is the Living Standards Measure (LSM). This tool
divides the population into ten LSM groups were 10 is the highest and 1 is the lowest. It
cuts across race and other techniques of categorizing people, and instead groups people
according to their living standards using criteria such as degree of urbanization and
ownership of cars and major appliances. The LSM uses 29 criteria such as hot running
water, electric stove, satellite TV, PC in the home and number of cell phones per
household.
Ranking of Segments
The LSMs 7, 8, 9 and 10 are attractive potential markets because of their high
expenditure. With the right kinds of values offered (e.g. unadulterated honey
sanctioned by religious groups such as the ZCC), the lower LSMs (4, 5 and 6) are also
become potentially attractive markets because of their numbers. In South Africa the
importance of Gauteng (with an average income per capita 93% higher than the national
average), Western Cape and KwaZulu-Natal cannot be underestimated in determining
strategies for sales of high value products in South Africa. The black middle class grew by
30% during 2006, adding a further 421,000 black people to the middle income layer of
the population known as "Black Diamonds." These figures point to a rapid growth in
consumer lifestyles among the black population, in turn having an impact on sales of
consumer goods. The Black Diamonds moved an extra R 60 billion (US$ 7 billion) into the
economy during 2006, despite four interest rate increases. Black Diamonds are
estimated to have an annual spending power of R 180 billion (US$ 25 billion). According
to the UCT Unilever Institute study, Black Diamonds account for 12% of black
consumers, but have 54% of black buying power. Black Diamonds now make up 2.6 M of
the total 23 M adult African population. For a company marketing consumer goods in
South Africa this is important as it points to a growing and more quality- and statusconscious consumer market.
Target customers and stages of adoption
Adoption and diffusion of innovation is a mass communication theory used by many, if
not all, marketers. A classic example is the Manuka honey story. Ten years ago New
Zealand bee-keepers dumped their Manuka honey or fed it to their cattle. Because of
clever marketing tactics that highlighted Manuka honeys medicinal values, producers
now achieve prices 10 times higher than conventional honey. The instant consumer
adoption and very fast market penetration can probably be attributed to satisfying
consumer culture (i.e. traceable, healthy, mono-flora, organic honey with medicinal
properties). Major South African retailers are focusing on the "Black Diamond" market.
This implies high value product that satisfies the aspirational needs of this target
market. Companies are increasingly also targeting low-income consumers often referred
22 of 59
to as the BOP69. Strengthening health consciousness will provide opportunities across all
segments of the industry.
How to target customers
Organic and fair-trade niches are the most attractive segments for African honeys. This
is where an effective traceability system that enables the consumer to choose what
food they purchase will be the maker or breaker of a product. With the right marketing
campaign, virtually all the market segments can be targeted. Marketing appropriate
values to market segments is more important than targeting one segment.
Current competitive situation
In South Africa competition is all about price. There is very little consumer awareness
about the value of honey, so the biggest competition is sugar syrup. Two thirds of honey
consumed in South Africa is imported. For AHB the major competition for producers are
honey packers that import cheap honey. However there is currently no competition on
the value added honey playing field largely because all imported honey must be
radiated and thereby eliminating organic certification. The honey packers import very
low quality honey from countries like China and Argentina and blend it with local honey.
As a result they are able to sell it at prices slightly higher than sugar syrups. It is a market
that will be very difficult to infiltrate because of the high cost of producing value-added
honey. Similarly, in Europe there is major competition for blended honeys. The largest
importers and packers of honey are found in Europe and especially Germany. There is,
however, very little competition for niche value-added honeys.
Major competitors in South Africa
Fleurs Honey - Pretoria
Highveld Honey Farms - Goldcrest Honey - Johannesburg
Highveld Honey Farms - Littlebee Honey - Johannesburg
Nektar Honey Johannesburg
Major competitors in Europe
Rowse Honey United Kingdom
Walter Lang - Germany
Tuchel Fair-trade - Germany
Gepa Fair-trade - Germany
Alfred L. Wolff - Honey & Bee Product - Germany
Naturenvie Sa - France
Alto Eco France France
AHBs competitive advantage
AHB can provide value-added honey at competitive prices.
69 The largest, but poorest socio-economic group. (BRINK 2010)
23 of 59
AHBs competitive disadvantage

Because AHB is a start-up company it has not yet been able to demonstrate reliability,
quality and stability.
AHBs competitive edge
Niche
AHB will be providing 100% traceable (by the customer) organic, fair-trade,
unadulterated honey from unindustrialized, unpolluted parts of Africa. Only one other
producer (from Mexico) offers the same value adds but at exorbitant prices.
Marketing Strategies
Key strategies
Direct off-take agreements with retailer/merchant: supply product direct to
distribution networks. Three off-take letters of interest are attached as Appendix B.
Through traceability, enable the customer to become their own organic, fair-trade
accreditation moderator.
Use technology to establish relationships between producers and customers.
The technology will also provide complete transparency and therefore develop
customer integrity and loyalty.
Achieve low cost exposure by running extensive public relations campaigns. The
media are always interested in running articles on the venture as it is a unique, new,
feel-good story; moreover, it has the marketing advantage of benefitting the
customer, the producer, the retailer/merchant, the natural environment and society
generally.
Provide the market with an interactive, well-run website that can be accessed from
store, cell phone or computer.
Positioning
AHB positions itself as premium quality, 100% traceable, organic, fair-trade African
honey that is sold at conventional honey prices. Emphasis will be made on the shared
values of the honey.
24 of 59
The global village market concept a self-tracing transparency

Imagine you are in Zrich, visiting your favorite Coop store at Bahnhofbrcke 1. Firstly,
you have chosen Coop because they guarantee safe (BRC-graded) triple-bottom-line
food. You want to buy some honey. At the honey shelf, you select a jar labeled organic,
fair-trade. The origin is marked as Kruger National Park, South Africa, Batch
AHB150267, July 2015. You notice that this jar is no more expensive than other
conventional honeys. Above the shelf you notice a computer screen and a barcode
reader with a sign that says scan here for info on your jar of honey. You decide to
rather use your cell phone QR barcode scanner. You scan the jar and immediately a
web-page opens with photographs, YouTube video links, articles and a Facebook page
enabling you to see, read about, watch and communicate with the actual rural African
bee-keeper that produced your jar of honey. There is information about the climatic
conditions and the wild unpolluted flora that made your batch of honey unique. You can
meet the bee-keepers family and see how by buying his/her honey, you have helped lift
people out of rural poverty. You can read about the nutritional and medicinal values of
your particular batch, followed by blogs suggesting recipes, uses and doses. You can
trace your jar of honey right down to the exact hive it came from. You can even view the
position of the hive on Google Earth. Best of all is the relationship you develop with the
honey bee farmer. You and your family love the unique, creamy African flavors of the
honey produced by Emily Khoza and you continue to buy AHB honey. Later you and your
family visit Emily at her home on your way to the Kruger Park.
Product
Below are the characteristics and attributes of the honey produced by this venture:
Unadulterated pure, virgin honey that doesnt contain any additives such as sugar
syrup.
Unblended similar to wine where no two batches are the same, each with its own
unique characteristics. Each jar of honey can be traced to a specific batch
characterized by season, climate and specific plants that flowered during that
season.
Raw - honey as it exists in the beehive or as obtained by extraction, settling or
straining, without adding heat.
Traceable - product loyalty is nurtured by enabling customers to do their own
traceability i.e. the ability to trace the product back to the producer, see the exact
location of the hive that produced the batch in the jar as well as the plants that
contributed to the batch, and even communicate with the producer.
Organic accredited supporting a production system that sustains the health of
soils, ecosystems and people. It relies on ecological processes, biodiversity and
cycles adapted to local conditions, rather than the use of inputs with adverse effects.
Organic agriculture combines tradition, innovation and science to benefit the shared
environment and promote fair relationships and a good quality of life for all
involved.
Fair-trade accredited AHB sees institutionalized fair-trade" as a subsidy or
marketing ploy that impedes growth. It has therefore developed a model that helps
25 of 59
producers in African poverty nodes to directly access global markets, achieve

competitive prices, trade under better conditions and realize sustainability.
Poverty alleviation each HUB of 40 BKBs will create 200 new sustainable jobs and
lift over 2000 people out of poverty70.
Mostly indigenous flora the Lowveld is home to over 100 indigenous bee plants.
This makes the honey special because no two batches are ever the same. Different
plants flower at different times according to the seasons and climate. Because of
the variety of plants that the bees forage on, the medicinal properties of the honey
are usually much higher than other honeys.
Greater Kruger National Park bordering the production area to the East is the
world-famous Kruger National Park. Hives positioned along its boundary will
therefore produce a very unique honey: there are not many honeys produced in
famous national parks.
Environmentally friendly - bee-keeping has an overwhelmingly positive impact on
the natural environment71. Communities that benefit economically from their
natural environment develop respect for it and a sense of conservation. AHB is also
assisting the Sabi Sand Game reserve (part of the greater Kruger National Park) to
protect Rhinos from poachers and trees from elephants.
No CO2 emissions the bee-keeping production methodology developed by AHB
functions on a zero fossil fuel, zero grid electricity system where solar-charged
electric bikes are used for transport.
Medicinal attributes the honey produced from Africas indigenous bush has been
tested and found to be even healthier than New Zealands Manuka honey, which
retails at US$120 per kg.72 Bushveld honeys were tested against Manuka honey to
compare their antibacterial action and in most cases the African honeys
demonstrated a higher antibacterial factor and tasted much better.
Market price by partnering with AHB, retailers are able to deliver superior values
and benefits to their customers at market prices by creatively restructuring the value
chain.
Pricing
Current indicative consumer prices for conventional table honey:
Woolworths (South Africa) R110 (US$ 13.75) per kg73
Coop (Switzerland) R120 (US$ 15) per kg74
Markets
The European market
The European market has an appetite for organic and fair-trade products and therefore
AHBs honey will be well received if its organic, fair-trade attributes are promoted.
70 Each BKB creates 5 permanent jobs (as discussed earlier). Each income earner in Bushbuckridge supports 10 people on average (StatsSA 2007).
71 (ARC 2001)
72 (Amazon 2012)
73 (Woolworths 2012)
74 (Coop 2012)
26 of 59
Three major European supermarket groups have already provided AHB with off-take
letters of interest, requiring that the product be packaged and labeled in South
Africa.
They like the proposed brand name African Honey Bee and would like AHB to
promote information about the projects traceability, poverty alleviation,
community development and environmental impact.
This information will also be very useful for their Corporate Social Investment (CSI)
public image.
They are very excited about AHBs website proposal to link producers to consumers
using internet social networking. They will consider placing computer screens and
QR barcode scanners with product on shelf so that consumers can immediately view
(on the website) the bee-keeper who produced the batch of honey, information on
how the bee-keepers family have been lifted out of poverty, the plants that
contributed to that specific batch and even the bee-keepers social media address.
Furthermore they are very excited to hear that AHB had partnered with the Sabi
Sand Game reserve and Kruger National Park and plan to run a media campaign to
promote this and the CSI aspects of the business.
The South African market
Consumer awareness about the positive attributes of organic, fair-trade honey in South
Africa is limited.
Most consumers consider honey a sweetener, not much better than Golden Syrup.
As a result, the best-selling honey in South Africa is cheap imported (dumped)
honey.
AHB have, however, received an off-take agreement from an organic food
distributor that supplies health products to about 350 stores in southern Africa.
These stores include upmarket delis, tourism boutique stores, a whole range of
pharmacies (e.g. The Dischem Group) and health stores.
After investigating how New Zealand successfully markets its Manuka honey75, AHB
decided to explore marketing its honey in South Africa as a medicinal or health food
product (packaged in a brown medicinal-looking jar). Initial market indicators are
good. South African consumers are prepared to pay higher prices for medicinal
honey. As discussed earlier, certain market sectors, e.g. the ZCC church, may use
only natural76 products as food/drink for religious reasons. Currently they consume
non-organic (imported, dumped) honey unknowingly. The ZCC church has
approximately 20 M members and their Easter gathering in Moria attracts 15 M
pilgrims. AHB sees this as potentially a very lucrative market.
75Ten years ago, New Zealand bee-keepers dumped their manuka honey or feed it to their cattle. Their bee-keeping association came up with a clever marketing tactic where they started selling
their honey as a medicine. They packaged the honey in a brown jar and developed a Unique Manuka Factor to measure the honeys antibacterial activity. Their government assisted in a
worldwide marketing campaign and now they achieve prices 8 times higher than conventional honey. (MGO 2010)
76 A product in its natural form that has not been processed.
27 of 59
Supply & demand

The U.K. consumed: 27,000 tons of honey in 2003 and 28,000 tons of honey in 2006,
725 tons of organic honey in 2003 and 1200 tons of organic honey in 2006, 100 tons
of fair-trade honey in 2003 and 250 tons of fair-trade honey in 200677.
Switzerland consumed: 10,000 tons of honey in 201078.
South Africa consumed: 1,500 tons of honey in 2003 and 3,000 tons of honey in
200679
Sustainability requirement
AHB needs to make a minimum of R47 per kg (wholesale price) to reach equilibrium80.
As illustrated in the figure below, AHB can achieve a wholesale price of R47 if product is
sold in South Africa81 to Woolworths.
To capture market, AHB will provide the consumer with a high value product at
conventional product prices82.
Communication Strategies
Advertising
There are so many public relations opportunities for this venture that it would be a
waste to spend marketing budget on expensive advertising.
77 (Seiler 2011)
78 (Seufert 2010)
79 (Shneider 2011)
80 (Silimela Development Services 2009)
82 (StatsSA 2007)
28 of 59
Public Relations
The advantage of this venture is that there is a very attractive feel-good story to be
told. Two freelance public relations journalists will be sub-contracted to manage the
public relations: one in Europe and another in South Africa. They will be required to:
write articles of a high standard that publishers will accept for inclusion in their
newspapers and magazines.
write press releases that attract attention and call to action various media such as
television, newspapers and magazines.
develop relationships with key editors of publications in Europe and South Africa.
host press visits.
Freelance PR specialists will be used rather than outsourcing to a company because:
it will be more cost effective.
editors prefer a personal relationship to mass media campaigns.
Promotion
A website linking the consumer to the producer will be used to promote the product.
Various methods of accessing the website will be used, for example, in-store computers
and screens, cell phones and personal computers. Please view Appendix M.
Communication Plan
Communications for this venture will require an integrated approach. Various steps will
be taken such as:
branding - including the development of a logo, a strapline and a slogan.
website development - the key communication platform that will provide
information, channel data, manage customer relations and offer complete
transparency.
o Key drivers will direct viewers to the website.
Social media will be the primary driver. Platforms will include:
YouTube channel - all interesting videos related to the project will
be uploaded by the administrator.
Twitter account followers will receive news and subject-related
issues.
Facebook page the good story will be told via this medium.
- All bee-keepers and staff will also have their own
Facebook pages.
Facebook group will be used primarily for internal
communications.
Search Engine Optimization (SEO) will be used to increase website
traffic.
Public relations will be a very important traffic generator for the website.
Product label information will also be an important driver to direct
viewers to the website.
29 of 59
Media Relations
While the geographical focus of the AHB project is the Mpumalanga region of South
Africa, there is enormous potential to raise AHBs profile nationally and ultimately
internationally. Dark Horse Communications83 (DHC) have recommended the following:
Thought leadership articles can be used to educate the public on why AHB is so
important. Each article would tackle one or more of the following topics:
o the unique properties of the honey and what that means to the consumer
(medicinal attributes; quality etc.) and
o the producer (organically farmed; fair-traded; poverty alleviation etc.)
Marketing Media: the use of social media to run a micro-enterprise such as AHB
Business Media: the entire business model for the business media.
Consumer Titles: leverage the feel-good factor and en vogue usage of words like
fair trade, organic etc.
Farming publications: how the production methodology results in zero CO2
emissions.
Food Publications: profile the use of honey in cooking and cite the wellness benefits
of using it in cooking.
Kids Publications (National Geographic Kids): profile the life cycle of the honey bee
as well as the project to a younger generation.
Religious Media: use the principles of AHB as a point of departure for Christian titles.
Media Visits
With the relationship with the Kruger National Park and the Sabi Sand Game Reserve
already in place, DHC suggests dovetailing any media visits to the park (both
internationally and locally) with a visit to AHB. This adds extra color to the
experience and leverages relationships that are already in existence.
Host media trips to the region and farms where journalists can be a bee-keeper for
the day and then write, blog and tweet about the experience.
External Stakeholder and Influencer Relations
Approach Blackberry and Cell C to get corporate sponsorship or get a percentage of
revenue generated as a CSI initiative to the project.
Deliver a special consignment of honey to social media influencers and incentivise
them to follow and tweet to the @AfricanHoney bee account. This would raise the
profile of the brand and help profile the project in a very cost-effective way.
Approach celebrity and celebrated chefs to get their endorsement of the product and
the project.
83 (Stubbs 2011)
30 of 59
Social Media
Much like www.beanthere.co.za, aggregate all communication across the social
media and other online platforms to drive traffic back to the website. This will assist
in keeping the content current and relevant, two of the cornerstones of social media.
By having the producers and the consumers interacting with each other through
these media, the product will have an extra layer of communication and a feeling of
inclusion by all parties concerned.
Save the Honey Bee Campaign
Colony Collapse Disorder (CCD) amongst other honey bee epidemics has created a
huge awareness about the plight of the honey bee. This global campaign can be used
to AHBs advantage.
With a project and a product of this nature, opportunities abound something that is
often quite lacking when doing media, stakeholder and influencer relations. With the
AHB project, there is not only scope to educate the public about the health benefits of
honey, but also help to empower communities to help themselves, while at the same
time profiling the will and determination of ordinary South Africans to be the best they
can be, with a world-class product, farmed locally for a global and domestic market 84.
Distribution
Distribution will be achieved by supplying directly to retailer/merchant distribution
hubs. Where possible, product will be packaged and labeled in Mpumalanga, South
Africa. Crated product will be packed in containers for export and local distribution.
Bulk importers
Bulk imports of honey reach consumers through importers, packers, wholesalers and
retailers. Importers usually combine the functions of importing honey into the EU with
processing, blending and packing the honey. Packers blend most of the polyfloral honey
to make acceptable table honeys. Most of the low-priced honeys end up as private label
products on supermarket shelves. The higher-quality monofloral and single-origin
honeys are sold as packers brands in both supermarkets and specialty shops.
Retailers
An estimated 85% of honey in the EU is sold directly to consumers85, and retailers play
an important role in the distribution of honey to consumers, super- and hypermarkets
constitute the most important outlets for honey. They belong to big retail groups in the
EU like Metro (Germany - http://www.metro.de), REWE (Germany http://www.rewe.de), Carrefour (France - http://www.carrefour.com), Auchan (France http://www.auchan.com), Groupe Casino (France -http://www.groupe-casino.com),
Ahold (The Netherlands -http://www.ahold.com), Delhaize Group (Belgium http://www.delhaizegroup.com), Coop (Switzerland - www.coop.ch), Tesco (UK 84 (Verrijdt 2011)
31 of 59
http://www.tesco.com) and Sainsbury (UK - http://www.j-sainsbury.co.uk). Due to their

size, these retail groups have substantial buying power. Apart from the brands of honey
suppliers, these retail groups all sell honey under their own brand to consumers (private
label or distribution brands). The private-label products are sold at lower prices to the
consumer, although the quality is not really different from that of suppliers brands. In
fact, private label honeys are often the same honeys as packers brands sold by other
retailers86.
In general, most honeys offered in retail outlets are blended, because it is not possible
to make an acceptable table honey from the lowest-priced honeys. Only specialty retail
stores offer a wide variety of single-origin/monofloral honeys. These specialty retail
stores, which often concentrate on organic and natural food products, form the second
retail channel for honey. Due to the increasing health and safety concerns, these shops
have become more popular during recent years. They are also a relatively important
channel for fair-trade honey.
The distribution of organic honey in Germany, Europes leading market for conventional
as well as organic honey, is mainly regional, and products often have to be purchased
from specialty wholesalers. Working relationships with these existing value chains are
hardly possible, thus eliminating one of the major competitive advantages of leading
supermarkets over smaller retailers. As a consequence, honey sales are mostly limited
to specialized retailers. In Germany there are two large organic supermarket chains:
'Alnatura' with 22 subsidiaries, and the Munich 'Basic AG' with 15 subsidiaries. Besides,
there are a number of smaller organic chains like Erdkorn, Denns, and SuperBioMarkt.
The top ten chains account for only about one third of all organic supermarkets.
However, concentration is expected to rise. This will result in increased demand from
the retail chains for larger volumes with a consistent quality. Packers have to deal with
this change by obtaining larger supplies of a consistent quality and by blending larger
amounts of honey from different sources87.
Customer relationship management
Because of the social media aspect of the marketing campaign, and the ability of
customers to directly communicate with producers, the supermarket retailer and AHB, a
system of evaluating feedback is already in place. AHB will contract a company like
Mobenzi that pays unemployed people to use their cell phones to categorize customer
tweets so that data can be analyzed.88
Sales reviews
Because of the direct channel between producers and the retailer via the traceability
system, an accurate real-time data flow will exist. By the time sales are made, all parties
involved will have an accurate history of the journey each batch of honey has travelled
88 (UN 2010)
32 of 59
along the value chain. When this information is added to actual sales information,
effective sales reviews can be made.
SWOT Analysis
STRENGTHS
Commercially viable Incubation HUB ensures
reaching break-even fast.
Simple Phased Approach based on principles of
sustainabilitytaking infrastructure to the
source
Well researched concept, field tested through
pilot projects and R&D.
Based on critical mass of high quality honey.
First professional bee-keeping course for
development bee-keeping.
Consistent with rural cluster development
projects.
WEAKNESSES
BKB loan risk and equipment abuse.
BKB attrition.
Theft and vandalism.
Widespread project area and related logistics.
Uncertainty regarding guaranteed market offtake.
Reliance on domestic market.
South Africa not listed as an EU honey provider.
OPPORTUNITIES
Access to abundant unpolluted natural resources.
Global shortage of honey.
Africa being the least polluted continent means
that we have the potential to become the highest
potential organic, fair-trade producer.
Value chain consolidation through the social
franchise model.
Branding opportunities (fair-trade, organic, Kruger
National Park).
Availability of funding for poverty alleviation
projects.
Honey suppliers, including those in developing
countries, are offered good opportunities through
adapting to the natural and health trends. Many
food manufacturers are currently engaged in
replacing the synthetic and less healthy
ingredients in their food formulations by natural
and healthier substitutes. Honey is potentially one
such substitute.
THREATS
Political interference in project rollout.
Bee disease, swarm absconding and Cape bee
problem.
Market disruptions from larg- scale producers.
EU banning imports.
A threat to the reputation of honey as a natural
health product, and subsequently to the
consumption of honey, is the imports of honey
contaminated by chloramphenicol and other
prohibited substances. Chloramphenicol is an
antibiotic which is used to cure sick bees, but
which can also cause a fatal blood condition in
susceptible individuals, called aplastic anaemia. In
2002, Chinese honey was banned from the EU as it
was often contaminated with chloramphenicol.
The negative media attention seriously harmed
the reputation of honey as a natural health
product.
Climatic conditions could affect honey production
in a negative way.
8. Innovation and Technology

Extensive research of failed rural development programmes in South Africa shows that
insufficient training, lack of on-going support and inappropriate technology are three of
the biggest obstacles to sustainable success. AHB has addressed these issues by
developing an innovative micro-franchise model (discussed in this document), AfroWestern bee-keeping technology, data and traceability software and an effective
method of training. Further information can be found in Appendix D and Appendix C
respectively.
33 of 59
Providing support on a partnership basis micro-franchising

The AHB micro-franchise model is not only a revolutionary new model for the South
African bee-keeping industry, but a proven and stress-tested approach to sustainable
small business growth across the globe.
Micro-franchising is able to effectively address the issues of critical mass, appropriate
structures, training, logistical support and access to market in a way that increases
development bee-keeper retention in the industry.
Micro-franchising not only ensures sustainability, alleviates poverty and creates jobs,
but also enables commercial viability and wealth creation.
Appropriate Training
In conjunction with Agriseta and Skills for Africa, AHB has developed a comprehensive
training methodology. Beneficiaries are chosen during a rigorous process, including a
one week practical bee-keeping course and an evaluation of attitude and interests. Each
selected bee-keeper is employed as a worker and is incubated for 18 months in an
Incubation HUB. Each HUB is established as a commercially viable 2000 hive enterprise.
During this incubation period, each bee-keeper is given 10 hives (of their own) and
trained according to the AHB manual Appendix C. At the end of the incubation period, if
the bee-keepers qualify, they become AHB franchisees and receive loans of R 140 K to
start their 100 hive businesses.
The AHB manual is probably one of the most comprehensive development bee-keeping
manuals available today. Written primarily by Guy Stubbs and edited by Andrew Weeks,
Kobus Visser and Martin Johannsmeier (one of the foremost bee-keeping authorities in
the world), the manual takes a BKB step by step along the path to becoming a successful
bee-keeping business. The course offered by AHB qualifies as a National Qualifying
Framework Level 1 qualification (a first year university equivalent). This is the first
course of its kind that enables illiterate bee-keepers to qualify by demonstrating that
they understand practically. The manual can be viewed in Appendix C.
Linking the producer to the consumer
The NektarTM (Nectar Knowledge Technology and Resources) traceability and
management system is a culmination of social-development, technology, networking,
pilot project trends, scenarios, and opportunities for ethical consumers to participate in
global markets, viewed in Appendix D. It is a true, entrepreneurial global value chain
link, driven by growing consumer demand and producer access to technology. Nektar TM
includes: Hive-stand placement software a QR code batch creator Cell phone data
collecting form Web-based data transformation tools. Information is accessed as: a)
Stand graphs89, b) Charts and c) Google Earth A producer traceability system The
websites: www.africanhoneybee.co.za and www.africanhoneybee.net
89 Graphs laid out in the same format as apiary stands.
34 of 59
Bee-keeping technology for Africa

AHB has developed a unique method of bee-keeping that combines the best of African
and Western apiculture. The honey bee-friendly Afri-hiveTM prevents the spread of
diseases, eliminates the necessity for expensive infrastructure and processes and
enables the bee-keeping businesses to qualify as zero CO emissions enterprises, viewed
in Appendix D. The Afri-hive system comprises:
Afri-hive (consisting of 3 x Lanstroth shallow supers with Fanie joints90, 33 Afriframes, 1 strap, 3 Afri-floorlids, 3 Afri-inner covers (made from UV protected,
250 micron, translucent plastic)
Afri-feeder
10-hive Afri-stand
4 hive Afri-stand
Afri-bike (solar-charged, battery-operated bike and trailer)
Afri-bee suit (consisting of Afri-gloves and Afri-veil-jacket, gumboots, bull denim
trousers)
Afri-smoker
Afri-hivetool
Afri-nectar (bee food - nectar substitute)
Afri-pollen (Bee-pro bee food - pollen substitute)
Afri-honey bucket
Afri-bee food drum
Afri-tab (Android, phone & data device)
Blue book
AHB bee-keeping manual
AHB franchise and bee-keeping legal and admin documentation (e.g. permission
to catch bees contract).
9. Operational Plan
Location of AHBs first Incubation HUB
AHB has identified Bushbuckridge municipality in Mpumalanga as an ideal location to
test and prove the concept of its operations plan. Bushbuckridge is not only one of the
poorest nodes in South Africa, but is also one of the areas with the highest bee-keeping
potential. Appendix F
Bushbuckridge Snapshot91
At 86% unemployment92, Bushbuckridge has one of the highest levels of poverty and
unemployment in South Africa.
The population of about 509,97093 people live in an area that covers 2 123 km2.
90 As developed by Fanie Joubert of Woodlands.
91 (Business Trust 2011)
92 (Business Trust 2007)
35 of 59
The total population is rural. The population density is 235 persons/km2.

Bushbuckridge faces serious backlogs in the provision of services (water, electricity,
sanitation, health care, schools):
Only 27% of households have electricity and 45% access to piped water within 200 m
of their homesteads.
70% of households live in traditional houses.
There are 139 primary and 170 secondary schools. Each primary school must serve
an average of 1068 eligible children between the ages of 5 and 14 years and each
secondary school must serve an average of 404 eligible children between the ages of
15 and 19 years. This has resulted in overcrowding, poor attendance and inadequate
education delivery.
There are three hospitals, 30 clinics, two mobile clinics and two community health
centres in the node.
Xitsonga is the predominant language in the area and is spoken by 58% of the
population, while 27% of the population speaks Sepedi.
Females make up 53% of the population, and comprise 56% of heads of households.
Most households are large with about 46% of households consisting of four to seven
members.
Approximately 72% of the population is under the age of 30 years which points to
the need for youth development programmes in stimulating nodal development.
Employment
Over 85% of the population lives below the poverty line, earning less than R 19.2 K per
annum. Only 14% of the residents between the ages of 15 and 65 years are
economically active. More than 84% of the employed are paid employees and only 3%
are self-employed. The public sector is the single largest employer in the node,
accounting for one third of all jobs, although manufacturing is also a major source of
employment (23%).
Education
Approximately 40% of residents do not have any education, with the remaining 60%
having some form of education. Over 70% of schools have no access to water or
electricity.
Health care
Health spending in Bushbuckridge (R 55 per capita) is substantially lower than it is on
average across the rest of South Africa (R 199 per capita). There is strong prevalence of
HIV and AIDS in Bushbuckridge, with 29% of the population infected.
Primary Landowners in the project area
1. The primary landowner is the South African Government.
2. Two thirds of the area is managed by tribal/traditional authority (the official
tenants).
93 (StatsSA 2007)
36 of 59
3. One third of the area comprises commercial private and public plantations.
Project Area Climate
Bushbuckridge normally receives about 860mm of rain per year, with most rainfall
occurring during mid-summer. It receives the lowest rainfall (4mm) in June and the
highest (158mm) in January. The monthly distribution of average daily maximum
temperatures for Bushbuckridge range from 22C in June to 28.3C in January. The
region is the coldest during July when the mercury drops to 6.7C on average during the
night.
Key biomes of Bushbuckridge
Bushveld
A wide variety of bushveld plants grow in the
region naturally, providing an interesting bouquet
of honey flavors and types.
Village
Villages in Bushbuckridge have a combination of
indigenous and exotic vegetation that provides
ideal forage for honey bees. Pollination from the
honey bees has been found to increase village
garden yields, in some cases producing eight times
more food than when there were no bees94.
Eucalyptus plantation
Catch boxes in a Eucalyptus/Saligna/Bluegum
plantation in Bushbuckridge. Eucalyptuses are well
known as excellent bee plants.
Carrying capacity and potential yield calculations can be viewed in Appendix E
94 (Khoza 2011)
37 of 59
Cost Effective Production Methods Appendix F

Cost effective equipment
The key technology developed by AHB is a plastic moulded frame 32 mm wide with a
starter strip eliminating the need for wax foundation. The unit cost of the frame is
reduced from R 14.50 for a traditional wooden frame to R 4 per frame and does not
require any assembly or maintenance costs Appendix D. Harvesting can take place at the
hive where comb and honey is simply knocked and scraped into a sterile bucket, cut up
with a hive tool or knife and immediately sealed. With this system no extraction house,
extraction equipment or any expensive infrastructure is required to harvest the honey.
Beehive equipment is all kept at apiary sites. When honey is harvested from frames, the
frames go straight back into the hives they came from, eliminating the spread of
disease. No honey is wasted or lost to other bees because the excess honey on the
frame is cleaned by the bees in the hive that the frame came from.
Cost-effective and hygienic transport
Using an electric, solar-charged bike rather than a fuel-driven truck, bee-keepers
transport food to their hives and honey back to their HUBs in sealed buckets. This
prevents any pollution or contamination. The first time the bucket is opened after
leaving the hive is in a controlled environment at the bottling plant, again eliminating
the possibility of pollution.
Eliminating expensive waxmoth prevention costs
Frames are never stored or even moved away from the apiary site, so waxmoth is not a
problem. Special prevention systems and storage facilities are therefore not required
and do not result in any additional expense. New comb is built up before flows by
feeding bees, reducing the potential waste of honey used by the bees to make new
comb from the flows.
Apiary layout
The AHB operation eliminates the requirement of a traditional facility with an in the
field production process based on bee plant vegetation carrying capacity. The NektarTM
software calculates the most appropriate positions for apiary sites based on the areas
carrying capacity, minimizing distances the bee-keeper needs to travel to visit sites and
taking into account access to roads and paths Appendix D.
Materials Requirement Planning
Colonies of bees are needed to produce honey. AHB therefore focuses on aquiering and
establishing honey bee colonies from which honey bee products can be farmed. AHB
uses a materials requirement plan (MRP) for estimating the material requirements,
quantities and time needed to establish production-colonies or making-increase.
Making-increase is a term used by bee-keepers to increase the number of bee stocks or
hived colonies. This method of obtaining new colonies or increasing existing colonies is
more reliable, but generally only practiced in South Africa during strong nectar and
pollen flows. AHB has developed a method of making-increase that enables a beeAfrican Honey Bee Business Plan by Guy Stubbs November 2012
38 of 59
keeper to establish their bee-keeping business at any time of the year. The bee-keeper
feeds the bees to stimulate a nectar and pollen flow and thereby is able to makeincrease and multiply the number of hives from a few to many in a relatively short
period of time, shortening the ramp-up period to break-even. AHBs method of makingincrease enables a bee-keeper to populate their apiary stand with ten productioncolonies in a period of four months from one initial colony. More information is
provided in Appendix F and Appendix G.
Logistics
Once AHBs bee-keepers have received their production colonies from the makingincrease process, they focus on producing honey. They travel from their homes on their
electric bikes to visit and inspect their bees. Once a week, they transport bee food to
their hives, feed their bees, inspect their apiary sites, manipulate any of the hives that
need manipulation and collect data with their Android devices. When they harvest
honey, the honey and comb is placed in a sealable bucket and transported to the closest
HUB. The HUB manager collects the honey from the HUB after weighing and logging the
yield and transports it to the bottling plant. Appendix F
Quality control
Quality objectives
AHB has four quality objectives, namely that a) bee-keeping methods are compliant with
AHB bee-keeping methodology, b) products produced are compliant with food safety
criteria, and c) products and methods are compliant with organic and d) fair-trade
resolutions.
Standards
For AHB bee-keeping methodology quality control, AHB makes use of the AHB
Manual (Appendix C) as the accepted standard. The content of the manual is
comprehensive, covering all aspects of bee-keeping, business practice, legal
requirements and operational procedures.
For food safety quality control AHB subscribes to HASSP (Hazard Analysis and Critical
Control Points) standards. HASSP is a systematic preventive approach to food safety
that identifies physical, allergenic, chemical, and biological hazards in production
processes that can cause the finished product to be unsafe, and designs
measurements to reduce these risks to a safe level.
For organic quality control AHB subscribes to IFOAM (International Federation of
Organic Agriculture Movements) standards. IFOAM defines organic foods as foods
that are produced using methods that do not involve modern synthetic inputs such
as synthetic pesticides and chemical fertilizers.
For fair-trade quality control AHB subscribes to EFTA (European Fair-trade
Association) standards. EFTA defines fair-trade as a market-based approach that
aims to help producers in developing countries by improving trading conditions for
the producers and promoting sustainability.
39 of 59
Tools
Data is collected via Android devices, NektarTM data collection software, sample tests
and visual inspections. Raw data is stored in a cloud database. Information is presented
in various formats, including charts, graphs and mapping interfaces and presented as
trends and statistics that can be analyzed and acted upon.
Legal requirements
Honey regulations must be compliant with the Foodstuffs, Cosmetics and Disinfectants
Act 54 of 1972 and the Consumer Protection Act, 2008, Notice 68 of 2008 as applied by
the Department of Health. The Act is intended to control the sale, manufacture and
importation of foodstuffs, to regulate labelling and advertising and to ensure general
provision of information about food. This ensures that consumers are informed about
potential food safety issues that may affect their health95.
10.
Management and Organization
Skillset
The various job types (Appendix H) required by AHB are:
The producer franchisees family-owned bee-keeping businesses (BKBs).
Each BKB business will be run from the family home and employ family members and
neighbours. Knowledge will be transferred through the members that receive training.
The family head (usually the mother) will be the business manager. A family member,
typically a daughter or son will be the main bee-keeper. Another daughter or son will
usually manage the banking, business communications and data collecting with the
business-owned smartphone.
As discussed previously, bee-keepers are incubated in commercially viable HUBs that
are established for this purpose. Each HUB optimally has a minimum of 40 BKBs under
one HUB manager. The commercially viable incubator employs ten bee-keepers over 18
months. During this time the new recruits are taught and mentored with their own ten
hives and trained for commercial-scale farming (100 hives or more). Beneficiaries are
usually impoverished but highly motivated women who are interested in nature, beekeeping, self-employment and small business. The constraints of the target groups and
final beneficiaries (in relation to the things they need) include lack of employment or
self-employment (especially from home), skills training, mentorship, technical and
logistics support, access to new, cheap and suitable bee-keeping equipment and
methods, and access to funding and markets.
Additional ancillary support businesses and jobs will be created in the target groups
including, amongst others, womens groups sewing protective clothing and microbusinesses manufacturing bee hives and bee stands.
95 (Act 54 1972) (Consumer Protection Act 2008)
40 of 59
HUB Managers - employed by the franchisor (i.e. AHB) to manage the HUBs.
Each HUB Manager will need to have advanced driving, leadership, information
technology and diplomacy skills and be a very keen bee-keeper willing to learn the AHB
method of bee-keeping and to share knowledge. HUB Managers will be required to
relocate to the villages where the HUBs are based and so it will be preferable to source
the managers from the communities representing the HUB, or for the candidates to be
single and prepared to relocate. HUB Managers will earn a fixed salary and a share of
revenues according to their HUBs performance. Each group of three HUBs will form a
Cluster.
Senior Bee-keepers employed by the franchisor to manage a Cluster.
The Senior Bee-keeper will need to:
have excellent logistic, diplomacy, information technology and management skills;
be very capable in and knowledgeable about bee-keeping, in particular, the AHB
method of bee-keeping;
be keen to learn and teach others about the subject;
be proficient in the Shangaan, Pedi and Swati languages;
have a thorough knowledge of the various cultures found in Bushbuckridge;
understand and be sensitive to local politics both from a traditional as well as a
municipal level; and
have strong entrepreneurial abilities.
The Senior Bee-keeper will earn a fixed salary and a share of revenues according to the
Clusters performance.
Operations Manager employed by the franchisor to pilot the clusters and keep
the business on track and in line with the AHB business model.
The Operations Manager will be required to ensure complete accuracy, traceability and
integrity of all financial transactions performed by the Franchisor. The Operations
Manager will also be responsible for bookkeeping (in-house or sourced out). The
Operations Manager will need to ensure that all BKBs, HUB managers and the Senior
Bee-keepers are proficient in the AHB method of bee-keeping. A vital function of the
Operations Manager will be to procure, catch and make-increase enough honey bee
colonies to ensure that the hives required for the venture are producing honey bee
products by the end of year one. The Operations Manager will also be required to
continually ensure that bee-keeping technologies are developed and improved to
increase yields. The Operations Manager will earn a fixed salary and a share of revenues
according to the ventures performance. The Operations Manager will also need to
understand social development and be sensitive to rural poor communities.
CEO/Project Driver contracted by AHB to lead the entire project.
The Driver will need to be a social entrepreneur passionate about bee-keeping as a nondestructive form of agriculture that can be used in the developing world as a poverty
alleviation mechanism, and have a wealth of experience and knowledge in this field. The
41 of 59
Driver will also need to have extensive knowledge and experience of social
development, agricultural and environmental issues, and in-depth marketing and
information technology expertise. Ideally the person appointed for this role should have
a social entrepreneurial MBA or similar. The Driver will earn a fixed monthly fee and be
incentivised by owning equity.
Human Resource structures and their functions Appendix H
Franchisor needs to:
Lead the project
Manage the project
Ensure that the Incubation HUBs are commercially viable
Coordinate the project and all stakeholders
Identify and incorporate appropriate stakeholders
Develop an appropriate and effective model
Determine the optimum funding structure and arrange finance for the venture
Source & supply all equipment and stock at below market rates
Identify and pre-qualify all bee-keepers for incubation
Provide and manage training, mentorship, quality control and field extension
services
Ensure quality control, organic & fair-trade accreditation
Establish a market for raw and value-added honey products
Facilitate the selling of honey for the franchisees
Buy in additional honey if necessary
Record, document and report all project results to, amongst others, the stakeholders
Develop new ancillary businesses and intellectual property
Franchisee needs to:
Produce honey bee products
Pay off equipment
Safeguard quality control
Safeguard organic and fair-trade status
Improve technology to increase yield and quality
Professional and Advisory Support
AHB is a firm believer in the proverb that without counsel plans fail, but with many
advisers they succeed96, and has therefore engaged a number of experts in various
fields. These experts include bee-keeping, bee-plant, intellectual-property, legal,
structural, financial, operations, technology and spiritual specialists. Although AHB has
mapped a rough path, these advisors have made a valuable contribution to the detail.
96 (Proverbs 15:22 ESV)
42 of 59
Recruiting
BKB Selection Process
As mentioned earlier, after a rigorous selection process, the Incubation HUB will employ
ten bee-keepers for intensive training and mentoring over an 18-month period. Each will
be given ten hives of their own to manage during this time. When the bee-keepers have
reached certain pre-determined milestones (including demonstrating satisfactory
knowledge and capacity in bee-keeping and hive management), they will be eligible to
become fully- fledged micro-franchisees with 100 hives each.
Recruiting staff
Prospective employees will be required to have many of the traits essential for the
position they will be applying for. In addition AHB intends to make use of psychometrics
i.e. the field of study concerned with the theory and technique of psychological
measurement, which includes the measurement of knowledge, abilities, attitudes,
personality traits, and education97 to assist in the selection of all key staff. Applicants
who demonstrate a keenness to serve others, a willingness to seek solutions, who
adhere to sound values and who demonstrate enthusiasm and initiative, will be
considered for key positions.
Training
AHB has developed two types of training, namely Fundamental Training and Franchisee
Training, and strongly supports the concept of knowledge sharing98.
Fundamental training has been based on Agrisetas National Qualifications Framework
Level 1 Animal Production course and has been adapted to Bee-keeping. Trainees need
not be literate to be awarded with a certificate and can be evaluated by demonstrating
that they understand the work being taught. The unit standards developed for this
course include: Communication, Entrepreneurship, Business Management, Production
Management , Financial Management, Marketing and Bee-keeping. The subjects are
kept broad with the intention of making participants aware of their role in global
business. Many of the recipients of this course are people who have very limited
knowledge about the world outside their own village.
Franchisee training on the other hand has been developed to unify all technologies and
methods that ease management and production. BKBs are taught the AHB method of
bee-keeping and about their specific role, position, function and responsibility within
the greater organisation. The information provided in Appendix C - the AHB Manual - is
very specific and provides step by step instructions on the application of all technologies
and systems.
Developing a culture of knowledge sharing - AHB has recognized that knowledge
constitutes a valuable intangible asset for creating and sustaining competitive
97 (Embretson and Reise 2000)
98 Knowledge sharing is an activity through which knowledge (i.e. information, skills, or expertise) is exchanged among people, friends, or members of a family, a community (e.g. Wikipedia) or an
organization (Dalkir 2005)
43 of 59
advantages.99 Knowledge sharing activities are generally supported by knowledge

management systems. However, technology constitutes only one of the many factors
that affect the sharing of knowledge in organisations, such as organizational culture,
trust, and incentives100. The sharing of knowledge, however, constitutes a major
challenge in the field of knowledge management because some BKBs might resist
sharing their knowledge with other BKBs101. One prominent obstacle is the notion that
knowledge is property and ownership thus very important. To counteract this,
individuals will be reassured that they will receive some type of incentive for what they
create. However, Kimiz Dalkir identified that the risk in knowledge sharing is that
individuals are most commonly rewarded for what they know, not what they share102. If
knowledge is not shared, negative consequences such as isolation and resistance to
ideas occur. Shared knowledge offers different viewpoints and possible solutions to
problems. To promote knowledge sharing and remove knowledge sharing obstacles,
AHB encourages discovery and innovation.
11.
Investment case
Investment opportunity
The investment opportunity offered by AHB is unusually attractive in that it is a
commercially viable enterprise that enables blended-value impact investors to
contribute even further in actively promoting a more sustainable economy, preserving
biodiversity and uplifting society in a way that glorifies God. In particular AHB is a unique
opportunity for public or private investors with a sustainable poverty alleviation
objective.
Funding social enterprises
AHB is a business that applies commercial strategies to maximize improvements in
human and environmental well-being, rather than maximising profits for external
shareholders and can therefore be defined as a social enterprise. 103 Social enterprises
are attracting increasing attention, from funders and policy-makers alike, by providing
sustainable, market-based solutions to social problems.
In the South African funding environment, finance tends to be directed to either nonprofit organizations that are grant-dependent, or to businesses that are expected to
generate profit and reward the financier with interest or dividends. AHB has partnered
with Lima Rural Development Foundation104, a non-profit, non-governmental
organization which specializes in rural development, enabling it to be eligible for both
types of funding.
99 (Miller and Shamsie 1996)

100 (Cabrera and Cabrera 2002)
101 (Ciborra and Patriota 1998)
102 (Dalkir 2005)
103 (Ridley-Duff and Bull 2011)
104 (Lima 2012)
44 of 59
South Africas Broad-Based Black Economic Empowerment (BBBEE) programme gives

preferential treatment in government procurement to companies who are seen to
empower black people and other previously disadvantaged groups, or who themselves
hire companies that empower these groups. Companies can earn points for Enterprise
Development (ED) or Socio-Economic Development (SED). ED is where companies assist
Black-owned and -operated businesses with technical and/or financial support
(including grants, loans, equity and in-kind donations), and SED is where companies help
to bring sustainable economic inclusion to previously disadvantaged groups (through
grants or in-kind donations). Corporations can use their Corporate Social Investment
(CSI) budgets on projects that will earn them SED points to help improve their BBBEE
compliance.
Overall, ED budgets are three times the size of SED budgets in South Africa, so qualifying
as a legitimate destination of ED funding is a major, and uniquely South African,
opportunity to get finance for a social enterprise on preferential terms. In addition to
corporations, many domestic, and some international Development Finance Institutions
(DFIs), prioritise black ownership or the empowerment of previously disadvantaged
groups when making funding decisions105.
There are two classes of enterprise that qualify for ED spending:
Category A companies deliver 25% extra BBBEE points and are thus particularly
appealing. These enterprises have at least 50% black ownership and a turnover of
less than R35M.
Category B enterprises still qualify for BBBEE funding at the regular rate. These
enterprises can be of any size, but must either have over 50% black ownership or
over 25% black ownership plus have a BBBEE rating of between 1 and 6.
Structure
AHB will be structured as a for-profit micro-franchise (for-profit to underpin commercial
sustainability, and micro-franchise to ensure that all participants are incentivized to
work together for the greater good of the enterprise106).
The structures that make up the AHB enterprise will include:
1. The holding company (AHB Holdings), which is:
a. structured as a (Proprietary) Limited company and is classified as a category
A enterprise and
b. is owned by:
i. the founder, Guy Stubbs who will retain 51% of the equity,
ii. a BKB and AHB employee Trust will have 25% of the equity reserved
for it,
iii. Kobus Visser and
105 (GreaterCapital 2011)
106 (Fairbourne, et al. 2008)
45 of 59
iv. Andrew Weeks, who will each be able to earn 12.5% of the equity
once predefined milestones have been met.
2. The local franchisor/Incubation HUB (AHB Kruger Park), which is:
a. structured as a (Proprietary) Limited company and classified as a category B
enterprise. The local franchisor/Incubation HUB will sign franchise
agreements with the BKBs, which it will support.
3. The franchisees (BKBs) are:
a. structured as independent enterprises,
b. members of the local Co-op and
c. classified as category A enterprises.
4. The Co-op (The Casteel Honey Bee Agricultural Co-op) is:
a. structured as an agricultural Co-op limited and
b. a 26% stakeholder in the local franchisor/Incubation HUB. It is also classified
as a category A enterprise.
To qualify for socio-economic development points, the beneficiaries of a companys SED
spending must be at least 75% black. Financers looking to gain SED points from financing
AHB will therefore be able to finance any one of the four structures listed above.
In the South African context, it is therefore clear that AHB can take advantage of its ED
and SED eligibility, and target finance providers who are looking for qualifying
organizations, as this is one of the largest sources of soft loans, grants and technical
assistance to social enterprises.
Funding the Bushbuckridge Incubation HUB
Soft loans for the BKBs

Requirement: R 140 K107 soft loans per BKB x 40 = R 5.6 M (over 6 years)
The model reflects soft loans (i.e. repayments calculated as a 30% share of the
Wholesale Revenue Share - illustrated in the figure below, until the loan has been paid
off), made by a lender (possibly seeking ED and SED eligibility or points108). Another
option is low-cost wholesale loans/repayable grant funding109 provided on a revolving
basis where BKBs pay a recapitalisation fee or rent for the use of equipment and hives,
and ownership of the equipment passes to the BKB once the recapitalisation fee paid, is
equal to the initial capital cost of the equipment110).
107 Capital & Set-up cost BKB's

108 (Zimele 2012)
109 (Tembeka 2012)
110 (Visser 2012)
46 of 59
AHB value chain structure (Visser 2012)
Quazi-equity/grant/loan for the incubator and incubation process

Requirement: R 5 M incubation capital and cost as grant, quasi-equity or a loan
An equity investment of R 1 M has been secured so an additional investment of R 4 M
would enable AHB to set up an Incubator HUB that breaks even in year 2. Thereafter
each group of new BKBs is incubated by the HUB without requiring third party funding.
Investment timing
Funding
The following figure demonstrates the ideal investment timing scenario for AHB to reach
break-even:
R 140 K soft loans
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
R 4 M quazi-equity/ grants/loans
Months
Ideal investment timing scenario for an AHB Incubator HUB (Visser 2012)
AHBs commercial eligibility for funding

1. AHB fills a gap in the market with unique goods and services. (For example: the new
Afri-frame technology that combines the best of African and Western apiculture.)
2. The market for AHBs products is expanding fast enough to allow AHB, as a new
entrant, to make good money from it. (For example: the global shortages of honey
bee products are creating global demand.)
3. AHBs product range has unique selling points that make it more attractive than
other offerings on the market. (For example: AHBs products will be the only organic
and fair-trade accredited honey brand in Africa.111)
111 (Acumen Fund 2012)
47 of 59
4. AHB can sell its products for less than the competition and remain profitable. (For
example: by partnering directly with retailers and cutting out expensive middlemen
like outsourced distribution agents, consumers will be able to pay conventional retail
prices for organic, fair-trade honey.)
5. Most importantly, AHB delivers unique social, environmental, food security,
economic and Kingdom-based112 benefits that are likely to open up other sources of
funding. (For example: because the competition does not have the same blendedvalue impact, AHB could gain a competitive advantage by raising grant, preferential
debt and equity funding.)
6. To become investment ready, AHB has been running a test project - as lean as
possible113 - for the last 18 months. (For example: the pilot has been funded by
grants and personal investments made by the founder, and management are
drawing reduced salaries.)
Return on investment
Beyond grants, the most appealing source of finance for AHB is patient capital. Whether
in the form of debt, equity, mixtures of the two, or convertible vehicles that only require
payback when the business is succeeding, patient capital would allow AHB to develop
market discipline without having the pressure of generating the sort of profits and
returns on investment that are demanded of purely profit-seeking businesses.
Besides being commercially viable with an expected Internal Rate of Return greater than
24%, the returns are very attractive. AHB could be considered as a fivefold- bottomline enterprise providing a social, environmental, food security, economic and
Kingdom-based return on an investment.
1. AHB is a true BBBEE initiative that creates jobs and stimulates economic
development.
2. From an environmental perspective, the venture contributes directly toward
environmental protection and the micro-bee-keeping business operations qualify as
zero CO emissions enterprises. AHB is also involved in using honey bees to protect
trees and Rhinos.
3. Besides increasing village garden food yields significantly, AHBs method of beekeeping preserves a healthy honey bee gene pool that can be used one day to
combat Colony Collapse Disorder and contribute to food security.
112 Real, viable, sustainable and profitable businesses; with a Kingdom of God purpose, perspective and impact; leading to transformation of people and societies spiritually, economically and
socially to the greater glory of God (Tunehag 2006).
113 (Ries 2010)
48 of 59
4. AHB is a true Kingdom business namely a for-profit business designed intentionally

to facilitate Gods transformation of people and Nations by being a witness to Gods
glory114.
5. Economically, the programme will directly benefit the impoverished producer
communities with an annual cash injection of more than R 40 M once 500 BKBs are
in full production.
12.
Financial Plan115
The model applies financial projections enabling various financial analyses at the levels
of the Franchisor (AHB) and at the level of the individual Franchisees (BKBs). The model
is constructed so as to ascertain the overall viability of the venture at both levels and to
develop the most desirable capital and cash flow structure. It reflects patient capital
loans and quazi-equity investments to the Incubator (R 5 M) and loans to be made to
the BKBs (R 140,000 per BKB i.e. to cover capital start up expenditure) and cash flows
between the AHB and the BKBs. The strict separation allows fine tuning of crucial input
parameters such as profit sharing percentages, production ramp up, break-even,
transfer prices and loan terms. Optimization of cash flows at both levels eliminates the
need for additional funding for the Incubator once break-even has been reached.
General assumptions
The assumptions in the model are based on setting up one Incubator HUB that operates
as a commercially viable, 2000-hive enterprise. The HUB employs ten bee-keepers for an
18-month period, during which time the bee-keepers are trained and mentored. Each
bee-keeper receives ten training hives during this period. The commercial viability of the
HUB enables the venture to reach break-even in year two, ensuring sustainability. At the
end of the incubation period (i.e. 18 months) those bee-keepers that have proved
themselves are eligible to become fully-fledged franchisees and soft loan recipients.
Every 18 months a further ten BKBs graduate. With each BKB expanding their businesses
from ten hives to the optimal 100-hive business, the venture starts to experience rapid
growth i.e. every new beehive added to the venture grows the business exponentially.
The non-quantitative project risks are outlined in Appendix J.
114 (Mulford 2012)

115 (Visser 2012) (Coetzee 2012)
49 of 59
General Assumptions
Number of learnership Beekeepers, Phase I
10
Number of existing hives
Number of Bushveld NEW hives per learner beekeeper
200
Number of Blue Gum hives per BKB
Number of training hives per beekeeper for incubation

Total number of NEW hives phase 1 (Incubator)
Total number of hives for production: Incubator
Number of BKBs per PHASE from phase 2
Total number of NEW hives per BKB PHASE
Senior Beekeepers (Mentoring)
Operations manager
Bee food per hive during first 6 month build-up
Bee food per hive per ANNUM during production
Land-use compensation (% of revenue)
Interest rate on BKB equipment loan
BKB equipment loan payment as % of revenue
Estimated table honey production per hive
Estimated sugar honey production per hive
Estimated bees wax production per hive
Estimated wholesale price for table honey*
Estimated wholesale price for sugar honey*
Estimated wholesale price for Bee wax
*Honey price is the wholesale price collected at the apiary site.
Production or price adjustment factor
Production cost - BKB's

Bee food - sugar (kg)
bee-keepers Salaries during Learnership
bee-keepers Cell phone & Data contracts
Contingency & general provision
10
no
no
2 100
2 000
10
1 000
no
no
kg
kg
%
%
%
kg
kg
kg
R/kg
R/kg
R/kg
1
1
16
10.8
1.5%
6.0%
30.0%
18
18
1.8
50
30
100
100%
kg
no
no
no
1 800
10
10
10
R4
R 1 760
R 150
200
Monthly cost
year 1
7 200
17 600
1 500
2 000
no
no
no
no
no
no
no
1
1
1
1
1
1
1
R 30 000
R 48 000
R 16 500
R 4 000
R 4 000
R 10 860
R 4 500
R 117 860
30 000
48 000
16 500
4 000
4 000
10 860
4 500
R 8 750
R 1 050
R 8 500
R 1 500
R 4 000
40 000
R 450
8 750
1 050
8 500
1 500
4 000
40 000
4 500
Unit
Quantity Unit price
Overhead Expense - Training, coordination & Implementation

Ops, Training & Coordation Managers
Mentor / Project Driver Salary
Travel & vehicle - management
Entrepreneurial Incubation / Set-up cost
Accounting & Auditing
Stationery, website, office expenses, consumables & general
Telephone/internet
Mentoring Expenses
Snr bee-keepers Salary CTC
Telephone/internet - Snr bee-keepers & Hub rep
Vehicle Costs
Rent Workshop/storage for Hub
Lima Mentoring Co-ordination & admin fee
Organic & fair-trade accreditation (per year)

General expense provision - mentoring & NQF level 1
no
no
no
no
no
year
no
1
1
1
1
1
1 R
10
50 of 59
Unit
no
no
no
no
no
no
pr
no
no
no
no
no
no
kg
kg
no
Capital & Set-up cost BKB's

Hives
Stand
Bee starter colonies
Android device/smart phone
Cell phone contract 24 months including data
Jacket veil (Complete bee suit)
Gloves
Smoker
Hive tool
Honey Bucket 20L
Bee food drum 20L
Blue book
AHB manual
Bee-pro bee food (only needed in 1st year)
Bee food - sugar for first 18 months
Bicycles
Total
Quantity Unit price

100
R 650
10
R 1 800
50
R 660
1
R 700
1
R 2 400
1
R 500
1
R 40
1
R 350
1
R 100
20
R 40
20
R 40
1
R 250
1
R 250
1 600
R4
1 620
R4
1
R 6 500
Year 1
R 65 000
R 18 000
R 33 000
R 700
R 2 400
R 500
R 40
R 350
R 100
R 800
R 800
R 250
R 250
R 6 400
R 6 480
R 6 500
R 141 570
Franchisee (BKB) Financial Projections

Income Statement for the year ending 31 December.
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
Revenue
1 646
78 792
113 400
113 400
113 400
113 400
113 400
113 400
113 400
Expenses
37 710
18 278
26 400
27 300
27 300
27 300
27 300
27 300
27 300
Equipment: non-capital items
18 820
Beekeepers Wages
10 560
Depreciation
Cell phone & Data contracts
7 095
14 190
14 190
14 190
14 190
14 190
14 190
14 190
14 190
900
1 800
1 800
1 800
1 800
1 800
1 800
Bee food
Land use compensation
6 480
6 480
6 480
6 480
6 480
6 480
6 480
35
1 688
2 430
2 430
2 430
2 430
2 430
2 430
2 430
Contingencies
1 200
2 400
2 400
2 400
2 400
2 400
2 400
2 400
2 400
-3 529
-8 112
-5 961
-3 331
-801
3 529
8 112
5 961
3 331
801
Profit before tax
-39 593
52 402
81 039
82 769
85 299
86 100
86 100
86 100
86 100
Profit for the year
-39 593
52 402
81 039
82 769
85 299
86 100
86 100
86 100
86 100
Cumulative profit
-39 593
12 809
93 848
176 617
261 916
348 016
434 116
520 216
606 316
Finance Cost
Interest Expense
Balance sheet for the year ending 31 December.

ASSETS
Non-Current Assets
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
108 805
94 615
86 925
72 735
65 045
50 855
43 165
28 975
108 805
94 615
86 925
72 735
65 045
50 855
43 165
28 975
21 285
Current assets
-94
40 841
86 931
138 621
196 871
297 161
390 951
491 241
585 031
Cash and Cash equivalents

Total Assets
-94
108 711
40 841
135 456
86 931
173 856
138 621
211 356
196 871
261 916
297 161
348 016
390 951
434 116
491 241
520 216
585 031
606 316
Property, Plant and Equipment
EQUITY AND LIABILITIES

Equity
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
21 285
Year 10
-39 593
12 809
93 848
176 617
261 916
348 016
434 116
520 216
606 316
-39 593
12 809
93 848
176 617
261 916
348 016
434 116
520 216
606 316
148 304
122 647
80 008
34 739
Non-Current Liabilities
148 304
122 647
80 008
34 739
Long Term Borrowings

Total Equity and Liabilities
148 304
108 711
122 647
135 456
80 008
173 856
34 739
211 356
Retained profits
Total Liabilities
261 916
348 016
434 116
520 216
606 316
51 of 59
Cash Flow Statement for the year ending 31 December.

Year 1
Cash from operating activities
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
-32 498
66 592
95 229
96 959
99 489
100 290
100 290
100 290
100 290
-39 593
52 402
81 039
82 769
85 299
86 100
86 100
86 100
86 100
7 095
14 190
14 190
14 190
14 190
14 190
14 190
14 190
14 190
115 900
6 500
6 500
6 500
6 500
115 900
6 500
6 500
6 500
6 500
148 304
-25 656
-42 639
-45 269
-34 739
Proceeds from long Term Borrowings
148 304
-25 656
-42 639
-45 269
-34 739
Net Increase in cash and cash equivalents
-94
40 936
46 090
51 690
58 250
100 290
93 790
100 290
93 790
Cash and cash equivalents at beginning of year
-94
40 841
86 931
138 621
196 871
297 161
390 951
491 241
Cash and cash equivalents at end of year
-94
40 841
86 931
138 621
196 871
297 161
390 951
491 241
585 031
Profit before tax

Adjusted for:
Depreciation
Cash from Investing Activities
Additions to PPE
Cash From Financing Activities
Analysis of Franchisee (BKB) (Calculations can be viewed in Appendix I)

There are no financial figures for the first 18 months of a BKB. This is because beekeepers receive 18 months incubation before they can start trading as a microfranchisee.
The first year of trading for a BKB is year two, according to the projection. Year two also
accounts for only six months, and is therefore not comparable with year three to year
ten.
Funding (BKB)
A BKB will make use of external funds to finance its initial operation.
The external funds will be in the form of a loan, bearing interest at 6%.
The loan will be repaid with 30% of the revenue earned in a BKB. The loan will
therefore be repaid in four years.
After the four years the BKB will not make use of any further external funds.
Debt Ratio
Owing to the 18-month training process explained above, the debt ratio for year two
will not be a realistic figure.
The debt ratio of one BKB in year three and four is quite high, the reason being the
loss of year two that is carried over to the next financial year.
The debt ratio falls to 20% in year five and thereafter the debt ratio is zero since
there are no long-term loans or current liabilities left in the BKBs statement of
financial position.
Gearing
Like the debt ratio, the gearing is also calculated from year three onwards.
The gearing of one BKB in year three equals 91%, but thereafter it drops to an
acceptable level of 46% in year four and a low-gearing of 16% in year five.
After year five the gearing is 0% since there are no long-term loans or current
liabilities left in the BKBs statement of financial position.
Interest cover
The BKB has a healthy interest cover from year three until year five.
52 of 59
All loans are repaid after year five, therefore there is no interest cover calculated in
year six to year ten.
Profitability (BKB)
Sales growth
12,600 kg table honey, 12,360 kg industrial honey and 1,248 kg beeswax production
is projected for year three.
It is much less than the 18,000 kg table honey, 18,000 kg industrial honey and 1,800
kg beeswax production projected for year four onwards.
This is the reason for the sharp sales growth of 44% projected from year three to
year four and zero sales growth percentage projection for the years following year
four.
Gross profit margin (GP %)
The GP % is not applicable in this projection, since there is no cost of sales.
Operating margin
The operating margin in year two is negative due to the company only trading six
months of the financial year and the high ad-hoc expenses. These expenses include:
- equipment: non-capital items
- bee-keepers wages
From year three to year ten the operating margin is above 75%, which is a very
healthy operating margin.
Net Profit margin (NP %)

From year three until year seven the NP % of the company grows steadily. This is
due to the interest that decreases yearly.
As explained under Funding, the interest bearing loan is projected to be repaid in
year six.
The NP percent is 55% from year seven to year ten. The only difference between the
operating margin and the NP percentage in year seven to year ten is the tax expense
which is calculated at the current company tax rate of 28%.
No interest is projected to be paid in year seven to year ten.
Return on capital employed (ROCE)

The ROCE ratio is extremely high in year two until year four.
Thereafter it decreases due to the Non-Current Asset value that decreases because
of depreciation.
Return on assets (ROA) and Asset turnover
The ROA and the asset turnover ratio is calculated by using the fourth years sales,
and Profit before interest and tax (PBIT) figures and the asset figure before
depreciation has been deducted, the reason being:
o Year four is the first normal production and trading year of the company.
53 of 59
o The depreciation on assets is calculated on a straight line method with no

resale value. If assets are written off to 0, the ROA and asset on turnover
ratios become infinite.
When ROA and asset turnover ratios are calculated with above assumptions in mind,
the company indicates an asset-light ROA ratio of 46% and an acceptable asset
turnover of 0.63 times.
Liquidity (BKB)
Except for year two, the overall projected liquidity of the BKB appears to be healthy.
The cash balances are R 94 in year two but grow to R 585 K in year ten.
No current ratio or quick ratio could be calculated, since there are no projected
current liabilities values.
Net present value (NPV) and internal rate of return (IRR)
No discounted rate has been used to calculate the NPV or IRR.
The company shows a positive NPV of R 372 K and its IRR is 37.99%.
Franchisor (AHB) Financial Projections
Income Statement for the year ending 31 December.
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
Revenue
Year 1
411 600
3 146 256
Year 2
3 577 680
Year 3
3 991 356
4 210 236
4 549 680
4 963 356
5 175 180
5 184 000
5 184 000
Cost of Sales
1 452 600
596 974
759 688
921 000
1 098 200
1 176 800
1 275 400
1 452 600
1 452 600
1 452 600
Production expenses
217 374
301 488
364 200
364 200
364 200
364 200
364 200
364 200
364 200
364 200
Mentoring expenses
379 600
458 200
556 800
734 000
812 600
911 200
1 088 400
1 088 400
1 088 400
1 088 400
Gross profit
-185 374
2 386 568
2 656 680
2 893 156
3 033 436
3 274 280
3 510 756
3 722 580
3 731 400
3 731 400
Other Expenses
2 169 608
1 803 328
1 835 882
1 894 582
1 925 882
1 958 682
2 015 882
2 014 582
2 015 882
2 014 582
Depreciation
317 100
317 100
317 100
317 100
317 100
317 100
317 100
317 100
317 100
317 100
1 414 320
1 444 320
1 474 320
1 534 320
1 564 320
1 594 320
1 654 320
1 654 320
1 654 320
1 654 320
Overhead expenses
Non-capital Equipment
337 100
Contingency provision
101 088
41 908
44 462
43 162
44 462
47 262
44 462
43 162
44 462
43 162
-110 000
-116 161
-83 886
-44 028
-6 304
110 000
116 161
83 886
44 028
6 304
Profit (loss) before tax
-2 464 982
467 079
736 911
954 546
1 101 249
1 315 598
1 494 874
1 707 998
1 715 518
1 716 818
Profit (loss) for the year
-2 464 982
467 079
736 911
954 546
1 101 249
1 315 598
1 494 874
1 707 998
1 715 518
1 716 818
Cumulative profit
-2 464 982
-1 997 903
-1 260 992
-306 446
794 803
2 110 401
3 605 274
5 313 272
7 028 790
8 745 607
Year 6
Year 7
Year 8
Finance Cost
Interest Expense
Balance sheet for the year ending 31 December.

ASSETS
Non-Current Assets
Property, Plant and Equipment
Current assets
Cash and Cash equivalents
Total Assets
EQUITY AND LIABILITIES
Equity
Shareholders equity
Retained profits
Total Liabilities
Non-Current Liabilities
Long Term Borrowings: Incubation funding
Term loan
Total Equity and Liabilities
Year 1
Year 2
Year 3
Year 4
Year 5
Year 9
Year 10
2 388 900
2 071 800
1 819 700
1 502 600
1 250 500
1 138 400
886 300
569 200
317 100
2 388 900
2 071 800
1 819 700
1 502 600
1 250 500
1 138 400
886 300
569 200
317 100
146 118
621 395
964 166
1 549 713
2 483 459
3 911 157
5 658 131
7 683 228
9 650 846
11 684 763
146 118
2 535 018
621 395
2 693 195
964 166
2 783 866
1 549 713
3 052 313
2 483 459
3 733 959
3 911 157
5 049 557
5 658 131
6 544 431
7 683 228
8 252 428
9 650 846
9 967 946
11 684 763
11 684 763
Year 1
-1 464 982
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 2
Year 3
-997 903
-260 992
693 554
1 794 803
3 110 401
4 605 274
6 313 272
8 028 790
9 745 607
Year 10
1 000 000
1 000 000
1 000 000
1 000 000
1 000 000
1 000 000
1 000 000
1 000 000
1 000 000
1 000 000
-2 464 982
4 000 000
-1 997 903
3 691 098
-1 260 992
3 044 858
-306 446
2 358 759
794 803
1 939 156
2 110 401
1 939 156
3 605 274
1 939 156
5 313 272
1 939 156
7 028 790
1 939 156
8 745 607
1 939 156
4 000 000
3 691 098
3 044 858
2 358 759
1 939 156
1 939 156
1 939 156
1 939 156
1 939 156
1 939 156
2 000 000
2 000 000
2 000 000
2 000 000
2 000 000
2 000 000
2 000 000
2 000 000
2 000 000
2 000 000
2 000 000
2 535 018
1 691 098
2 693 195
1 044 858
2 783 866
358 759
3 052 313
-60 844
3 733 959
-60 844
5 049 557
-60 844
6 544 431
-60 844
8 252 428
-60 844
9 967 946
-60 844
11 684 763
54 of 59
Cash Flow Statement for the year ending 31 December.

Year 1
Cash from operating activities
Profit before tax
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
-2 147 882
784 179
1 054 011
1 271 646
1 418 349
1 632 698
1 811 974
2 025 098
2 032 618
2 033 918
-2 464 982
467 079
736 911
954 546
1 101 249
1 315 598
1 494 874
1 707 998
1 715 518
1 716 818
317 100
317 100
317 100
317 100
317 100
317 100
317 100
Adjusted for:
Depreciation
Cash from Investing Activities
Additions to PPE
Cash From Financing Activities
Proceeds from long Term Borrowings
Less: Repayment of term borrowings
Shareholders Fund
Net Increase in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
317 100
317 100
317 100
2 706 000
65 000
65 000
205 000
65 000
65 000
2 706 000
65 000
65 000
205 000
65 000
65 000
5 000 000
4 000 000
1 000 000
146 118
146 118
-308 902
-308 902
-
-646 240
-646 240
-
475 277
342 771
146 118
621 395
-686 099
-686 099
-
-419 603
-419 603
-
585 547
933 746
1 427 698
1 746 974
2 025 098
1 967 618
2 033 918
621 395
964 166
1 549 713
2 483 459
3 911 157
5 658 131
7 683 228
9 650 846
964 166
1 549 713
2 483 459
3 911 157
5 658 131
7 683 228
9 650 846
11 684 763
Analysis of Franchisor (AHB) (Calculations can be viewed in Appendix I)

Funding
80% of the total Long-Term Borrowings in the statement of financial position of the
company will be received from external resources. The terms on these loans are as
follows:
o R 2 M will be an interest-free, long-term loan, with no repayment
arrangements.
o R2 M will bear interest at 6%. Interest will be payable during the first 18
months. Thereafter the loan is repaid over 36 months in equal installments.
This loan will be repaid in four years after the first installment.
The other 20% of the funding will be received from the shareholders contributions,
being internal funding.
The company will not make use of any further external funds after the four years.
Debt to Equity (AHB)
The business setup will be done in the first six months of the projected period. There
will be no production in the first six months due to this setup. Therefore, the
production and sales in the first year of trading are almost half of production
achieved and sales received in a normal financial year. For this reason, debt ratio
calculation for year one will not be a realistic figure.
Owing to the big loss projected in year one the debt to equity ratio will be:
o negative for year two to three.
o very high for year four to six.
There is a healthy decline in the debt to equity ratio due to the loan repayment and
accumulated profit figure in equity. From year seven to ten the debt to equity ratio
will be on an acceptable level below 50%.
Gearing (AHB)
Like the debt ratio, the gearing is calculated from year two onwards.
The gearing of the company in year two to four is above 50%, which means the
company operates at a high risk during the first four years of its existence.
After year four the gearing drops to an acceptable level below 50%.
55 of 59
Interest cover (AHB)

The company has a healthy interest cover from year two until year five.
All interest bearing loans are repaid after year five, therefore there is no interest
cover calculated for year six onwards.
Profitability (AHB)
Sales growth
The financial year runs from 1 July to 30 June.
There is a drastic growth in sales from year one to year two. There are a number of
reasons for this growth:
o The business setup will be done in the first six months of the projected
period. There will be no production in the first six months due to this setup.
o In a normal production year the company will produce 36,000 kg table
honey, 36,000 kg industrial honey and 3,600 kg beeswax respectively.
o However, due to the six months setup period in the 1st year, the business
will only produce 16,800 kg industrial honey and 588 kg beeswax
respectively.
o In order for AHB to establish franchisees/BKBs it will incubate bee-keepers
for a period of 18 months to become franchisees. After the 18 months the
bee-keepers that qualify will operate their own micro bee-keeping business
(BKB). AHB will receive a percentage of the BKBs monthly revenues in
exchange for providing technical, logistics and marketing support.
The revenue of AHB increases from year two onwards steadily. This increase is due
to the micro bee-keeping businesses that are added to the franchise every 18
months.
Gross profit margin (GP %)
There is a radical increase in GP % from year one to year two. This is due to the
enormous escalation of sales from year one to year two. Reasons are discussed
above.
GP % is rather stable from year two until year ten, which indicates that the
companys projected annual revenues and cost of sales is stable.
Operating margin
The operating margin in year one is negative due to low revenue figures (explained
under sales growth) and high ad-hoc expenses. These expenses include:
o Non-capital equipment
o Contingency provision
From year two until year eight the operating margin increases steadily to 33%.
The operating margin in year eight to year ten stays at 33%, which indicates little or
no change in revenue or expense values.
56 of 59
Net Profit margin (NP %)

From year two until year seven the NP % of the company grows steadily. This is due
to the interest that decreases yearly and the BKBs that are added to the enterprise.
As explained under Funding, the interest-bearing loan is projected to be repaid in
year five.
The NP % is 24% from year seven to year eight. The only difference between the
operating margin and the NP % in year eight to year ten is the tax expense which is
calculated at the current company tax rate of 28%.
No interest is projected to be paid in year eight to year ten.
Return on capital employed (ROCE)

In year one the ROCE ratio is negative due to a negative profit before interest and
tax (PBIT). The negative PBIT is caused by the low revenue figures (explained under
sales growth) and high ad-hoc expenses in year one (explained under Operating
Margin).
The ROCE is positive from year two onwards. The ratio keeps on growing until year
four. The ratio decreases from year five onwards due to the long-term liabilities
(non-interest bearing funding and shareholders contribution) that stay unchanged
for the projected ten-year period and non-current assets that decrease annually
with depreciation.
Return on assets (ROA) and Asset turnover
The ROA and the asset turnover ratios are calculated using year twos revenue and
profit before interest and tax (PBIT) figures and the asset figures before any
depreciation has been deducted, the reason being:
o Year two is the first normal production and trading year of the company.
o The depreciation on assets is calculated on a straight line method with no
resale value. If assets are written off to 0, the ROA and asset on turnover
ratios become infinite.
When ROA and asset turnover ratios are calculated with above assumptions in mind,
the company indicates a ROA ratio of 16% and an acceptable asset turnover of 1.16
times.
Liquidity (AHB)
In overall terms the projected liquidity of the business appears to be healthy.
The cash balances grow from R 146 K in year one to R11.6 M in year ten.
No current ratio or quick ratio could be calculated, since there are no projected
current liabilities values.
Net present value (NPV) and internal rate of return (IRR)
No discounted rate has been used to calculate the NPV or IRR.
The company shows a IRR greater than 24%.
57 of 59
13.
Summary
Its an undisputed reality the South African economy desperately needs more
successful, sustainable entrepreneurs and millions of new employment opportunities,
especially in rural areas of the country. Yet many rural communities living in
economically disadvantaged nodes have access to profitable bee-keeping natural
resources that they are not aware of, nor currently benefitting from.
The global shortage of honey bee products, especially those that comply with organic
and fair-trade standards, means that there are exceptional opportunities for trained
bee-keepers in unpolluted rural areas.
The AHB micro-franchise model is not only a revolutionary new model for the South
African bee-keeping industry, but a proven and stress-tested approach to sustainable
small business growth across the globe. Micro-franchising is able to effectively address
the issues of critical mass, appropriate structures, training, logistical support and access
to market in a way that increases development bee-keeper retention in the industry.
Micro-franchising not only ensures sustainability, alleviates poverty and creates jobs,
but also enables commercial viability and wealth creation.
AHB is a Christian social entrepreneurial business with specific expertise in high-tech
organic bee-keeping, rural development and marketing. Through the AHB model, family
owned and operated micro bee-keeping businesses in impoverished rural
Bushbuckridge (in the province of Mpumalanga, South Africa) can profitably participate
in the global organic and fair-trade honey markets something that would be virtually
impossible to achieve as individual, uncoordinated subsistence bee-keepers.
The concept is based on achieving breakeven in year 2 by incubating bee-keepers
through commercially viable incubation hubs that employ, train and mentor the beekeepers over an 18 month period. Once the bee-keepers qualify as African Honey Bee
franchisees, they become eligible to receive loans of R140,000 to set up their own BKB.
Once break-even has been achieved, every additional franchisee and hive added to the
enterprise grows the business exponentially.
The investment opportunity offered by AHB is unusually sweet in that it is a
commercially viable project that significantly improves the wellbeing of people and
planet.
The AHB programme scores high marks in terms of promoting:
sustainable micro-enterprise development
addressing solutions for food security
capacity-building
58 of 59
poverty relief
organic agriculture
preserving biodiversity
enhancing agriculture through pollination
creating new niche export markets
glorifying God
The AHB enterprise is a true Broad-Based Black Economic Empowerment initiative that
creates jobs and stimulates economic development.
From an environmental perspective, the venture contributes directly towards
environmental protection and the BKB operations qualify as a zero CO emissions
enterprises.
And economically, the enterprise will directly benefit the impoverished producer
communities with an annual cash injection of more than R40 M once 500 bee-keepers
are in full production.
So bottom line: AHBs model is commercially viable and sustainable, with AHB expected
to deliver robust financial returns, providing a solid basis for accelerated expansion into
the next phases when further incubation HUBs and owner operated micro-bee-keeping
businesses will add value to the system.
59 of 59

African Honey Bee Micro Franchise Incubator Nov 2012

Uploaded by

Copyright:

Available Formats

African Honey Bee Micro Franchise Incubator Nov 2012

Uploaded by

Document Information

Original Description:

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

African Honey Bee Micro Franchise Incubator Nov 2012

Uploaded by

Copyright:

Available Formats

What is the African Honey Bee business model?

What is the African Honey Bee business model?

What are the benefits of the African Honey Bee business for beekeepers?

What are the benefits of the African Honey Bee business for beekeepers?

AFRICAN HONEY BEE

African Honey Bee Business Plan by Guy Stubbs November 2012

Khensani Sondlani bee-keeper, Bushbuckridge

1 A cluster of bee-keepers living in close proximity to each other.

African Honey Bee Business Plan by Guy Stubbs November 2012

why a Christian Social Enterprise

African Honey Bee Business Plan by Guy Stubbs November 2012

development in the poorest rural areas of southern Africa. Coincidentally, these

African Honey Bee Business Plan by Guy Stubbs November 2012

4. African Honey Bee

African Honey Bee Business Plan by Guy Stubbs November 2012

African Honey Bee Business Plan by Guy Stubbs November 2012

African Honey Bee Business Plan by Guy Stubbs November 2012

5. The political dynamism: By involving producers and consumers in the Global

African Honey Bee Business Plan by Guy Stubbs November 2012

21 (Sommeijer, et al. 1997)

African Honey Bee Business Plan by Guy Stubbs November 2012

The bee-keeping industry in South Africa

African Honey Bee Business Plan by Guy Stubbs November 2012

Two positive aspects were highlighted:

6. AHB products and services

The Franchise AHB sells a complete business in a box franchise to franchisees,

African Honey Bee Business Plan by Guy Stubbs November 2012

African Honey Bee Business Plan by Guy Stubbs November 2012

African Honey Bee Business Plan by Guy Stubbs November 2012

African Honey Bee Business Plan by Guy Stubbs November 2012

Consumers - developing versus developed countries

African Honey Bee Business Plan by Guy Stubbs November 2012

Partnering with key retailers table honey

African Honey Bee Business Plan by Guy Stubbs November 2012

51 In Judaism, a Rabbi is a teacher of Torah (Jewish Encyclopaedia 2012).

African Honey Bee Business Plan by Guy Stubbs November 2012

African Honey Bee Business Plan by Guy Stubbs November 2012

African Honey Bee Business Plan by Guy Stubbs November 2012

African Honey Bee Business Plan by Guy Stubbs November 2012

African Honey Bee Business Plan by Guy Stubbs November 2012

69 The largest, but poorest socio-economic group. (BRINK 2010)

African Honey Bee Business Plan by Guy Stubbs November 2012

AHBs competitive disadvantage

African Honey Bee Business Plan by Guy Stubbs November 2012

The global village market concept a self-tracing transparency

producers in African poverty nodes to directly access global markets, achieve

African Honey Bee Business Plan by Guy Stubbs November 2012

African Honey Bee Business Plan by Guy Stubbs November 2012

Supply & demand

African Honey Bee Business Plan by Guy Stubbs November 2012

African Honey Bee Business Plan by Guy Stubbs November 2012

African Honey Bee Business Plan by Guy Stubbs November 2012

African Honey Bee Business Plan by Guy Stubbs November 2012

http://www.tesco.com) and Sainsbury (UK - http://www.j-sainsbury.co.uk). Due to their

African Honey Bee Business Plan by Guy Stubbs November 2012

8. Innovation and Technology

African Honey Bee Business Plan by Guy Stubbs November 2012

Providing support on a partnership basis micro-franchising

African Honey Bee Business Plan by Guy Stubbs November 2012