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    Date submitted
  • 18-Oct-2012

Eccolizer

Abstract

Because of high prices and chemical effects of existing fertilizers, over 100 million farmers of Bangladesh fail to cultivate enough foods. Less food production has consequently rendered 65 million people food-insecure.

Eccolizer offers an affordable & eco-friendly fertilizer, which is mainly prepared from the sugarcane bagasse, to the over 100 million farmers to reduce the pain of high prices and chemical effects of conventional fertilizers. The fertilizer so offered also works as insecticide, pesticide, germicide and herbicide.

Laboratory testing and pilot projects approve that Eccolizer works as fertilizer and pesticide.The enterprise has already conducted a pilot project and several follow-up projects for continuous development. After positive results from the pilot-projects, Eccolizer has been supplied to 22 districts of Bangladesh and received positive responses from the 95% customers. Now it intends to continue providing inexpensive bio-fertilizer to the vast majority of poor farmers in Bangladesh, and beyond.

Eccolizer possesses several unique features. Firstly, it is 90% cost-effective compared to the combined prices of Urea, TSP and MOP fertilizers. For cultivating 1 hector of land, fertilizers of the three types cost $150 while the price of Eccolizer is only $15. Secondly, Eccolizer also works as insecticide & pesticide and thus saves pesticide expenses of minimum $40 worth required for cultivating the aforesaid land. Thirdly, due to its strong insect repellent attribute, Eccolizer strongly guards against any insects, pests and herbs whereas chemical pesticides fail to prevent the insects & pests, which cause crop losses of around $100 million every year. Finally, Eccolizer bears no harmful effects on the soil & environment unlike chemical fertilizers.

Eccolizer is a patent-pending technology developed by the CTO of Eccolizer and the enterprise will own the patent in its name just after managing the seed capital.

According to Bangladesh Fertilizer Association, every year the country imports around 3 million metric tons of chemical fertilizers while the total annual demand is nearly 7 million tons that correspond to over USD 3 billion. Eccolizer has potentials to capture the whole fertilizer market with its cost-effective &eco-friendly fertilizer. Experiencing from the pilot project, Eccolizer has equated its 20 liters liquid fertilizer against 1 metric ton of solid chemical fertilizer. In this estimate, total demand of the liquid fertilizer would be 140 million liters. Meeting the demand mainly hinges upon the availability of the raw materials, sugarcane bagasse. From 1 ton bagasse, 200 liters liquid fertilizer is produced. Currently, there are 17 sugar mills across the country, each having annual disposal amount of 60 million tons of which 50% can be usable for fertilizer production. So, using the bagasse of only 1 sugar mill, total fertilizer to be produced annually is 600 million liters. So, after the full-swing business operations Eccolizer will gradually approach to capture the entire fertilizer market of Bangladesh.

Eccolizer has huge export potentials too. India, the closest neigbouring country of Bangladesh, has a fertilizer market of around USD 28 billion. The aim of the business is to export this fertilizer to the country as well.

While analyzing the competitive prices of three major fertilizer providers namely the govt. owned 7 fertilizer companies, the private companies and the local-level producers, Eccolizer is feared at its sustainability in the long run. In this regard, it plans to penetrate in the village markets with the help of 3 proposed NGOs namely Grameen Bank, Brac and Swiss Contract. In the meantime, it is discussing with the Grameen Krishi, the lead wing of Grameen Bank, to sell the bio-fertilizer through its country wide branches. Apart from going to contract with the three NGOs, Eccolizer has innovated in its distribution side as well. It is about recruiting the poor village women as the sales agents who will purchase the fertilizer on credit, sell it to the farmers of their respective villages and earn some margins on the sales. Primarily, Eccolizer is targeting around 5000 villages in the country’s north-Bengal area. The number of villages will increase in the coming years functioning through the women sales representatives and the 3 NGOs.

The core team of Eccolizer comprises few students of various backgrounds that mainly include business and engineering. The students’ body has grown necessary expertise in particular fields such as management, marketing, finance and chemistry from working in different business projects. Apart from the core student team, there are few professionals working as the non-core management team of Eccolizer.

The capital requirement for Eccolizer has been calculated to be $ 818750 (excluding R&D Activities) which is to be financed both by equity and debt. The four founders have agreed to provide 60% of that amount. Dutch Bangla Bank Ltd. has agreed that on receipt of the founders 40% they will provide the remaining funding in debt capital. Revenue projections, in a conservative manner, shows that from year 1 through year 4, Ecolizer respectively earns a profit of around $122341, $203660, $394147, and $551861. Internal Rate of Return (IRR) is 45% and Payback Period is 2.36 year, whereas Net Present Value (NPV) is $715203.

The Social Impact Assessment (SIA) of Eccolizer shows a social benefit of $60 against each $1 invested. This basically derives from the multi-dimensional social benefits delivered by Eccolizer. These benefits mainly include reduction of fertilizer expenditures, saving from pesticide expenses, reduction of govt. spending as subsidy and creating employment opportunities. Within 4 years of formal business operations Eccolizer will reduce fertilizer expenses by USD 4,900,000, pesticide expenses by USD 4,900,000 and the govt. spending by USD 27,790,350. Eccolizer will also generate employment for around 5000 women at the end of 5 years. However, launching this venture, the 64 million extremely poor people of Bangladesh will have access to sufficient foods that will lead them to the healthy and improved life.

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Additional Questions

Who is your customer?

110 million farmers of Bangladesh will be our customers since they have very low income, less than $2 per day, they need a low-priced fertilizer.

What problem does this idea/product solve or what market need does it serve?

Intensive fertilizer crisis coupled with high prices will be solved by launching our business. The price of fertilizer needed for a farmer to cultivate a land of 1339 meter square is $10 whereas we are offering fertilizer to cultivate the same land only at $1.

What attributes will make this idea/product successful? Why do you believe that those features will create success?

The main attributes for making it successful are: low cost, environment-friendly, village-level intensive marketing by NGOs and employment opportunities for poor village women.

Explain how you (your team) will execute to make this idea/product successful? What gives you (your team) an advantage over others already in the market or new to this market?

Our main advantage lies in the fact that we are extracting a novel compound from sugarcane bagasse which works as an organic source of nitrogen. Also, it works as pesticide, germicide and herbicide. So, in a very low priced fertilizer a farmer can gain advantages of pesticide and others whereas the traditional fertilizer works only as fertilizer and costs very high.