Soy entrepreneurship development

Soybean (Glycine max) is an environment friendly grain legume and a major source of protein, oil and health promoting phytochemicals for human nutrition and livestock feed around the globe. Soybean cultivation also improves soil health because of its atmospheric nitrogen fixing ability and deep root system. Soybean has now become an important world commodity because of its wide range of geographical adoption, unique chemical composition, good nutritional value, functional health benefits and industrial applications. Soybeans were referred as Cinderella crop and later as The Gold that grows.

India has a great potential for the production and domestic utilization of soybean and its derivatives for health and economic benefits of the people of the country. Soybean has its origin in Manchuria, China and from there it spreaded to Korea and Japan. Later on because of its economic, nutritional and ecological benefits, soybean cultivation was spread to many countries in the world, especially in Asia, Central and South America, Europe and Africa. The present world production statistics is given as under.

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World Soybean Production 2011

Million Bushels
.

Million Metric Tons

.

United States Brazil Argentina China India Paraguay Canada Other

3,056 2,645 1,764

83.2 72.0 48.0 13.5 11.0 6.4 4.2 13.1 . . 251.5 .

496
404 235 156 483 .

Total

9,239 .

Source: USDA

The soybean was probably introduced to India from China through the Himalayan mountains several centuries ago. The crop was initially established and successfully cultivated on the slopes of Himalayas up to 2000 m in Himachal Pradesh,Uttarkhand/UP,Bihar,West Bengal and Assam. Now the area under soybean in the country has increased from 9.33 million hectare in 2011-12 to 10.26 million hectares and increase acreage has mainly seen in Maharashtra, Rajasthan, Tamil Nadu and Andhra Pradesh. According to estimates, the soybean production may rise by 8-10% for the Kharif season. This is likely to provide relief to the domestic crushing industry as the mills are on the verge of closure on non-availability of

oilseeds for crushing. The higher price realisation of soybean has boosted the farmers to increase area under the crop. Last year, the soybean production was recorded at 10.5 million tons.

Nutritional significance There are more than 1100 million people in India and majority of them (65-70%) are vegetarian and derive their proteins from pulses, cereals, milk and to some extent from oilseeds like peanuts, sesame and soybean. In general the quality of protein consumed by them is poor. Better quality proteins from eggs, meat and aqua products are costly and only a select group of rich population have access to it. About 30% of Indian population are below poverty line and do not have purchasing power for good quality dietary proteins. This calls for providing them an alternative source of dietary protein which could be financially affordable. Soybean meets such requirements. On an average it contains 40% protein, 23% carbohydrates, 20% oil, 5% minerals,4% fibre and 8% moisture. It provides 430 calories. Soybean has all the eight essential amino acids. However it contains certain ant nutritional factors like trypsin inhibitor, urease, flatulence factors etc. Hence it requires careful processing before utilization Protein Efficiency Ratio of soy protein increases considerably when combined with other cereal and legume proteins. The approximate cost of one kilogram of protein from different sources is given below. Source Full Fat soy flour Split pulses(dal) Egg Milk Chicken Fish Meat Protein: Lowers the blood cholesterol. Carbohydrates: Relaxes constipation. Good for diabetics. Fat: Prevent cardio-vascular diseases. Mineral: Overall health promotion. Vitamins: Overall health promotion. Phytochemicals: Prevent cancer, helpful in menopause and osteoporosis. In spite of a number of good features of soybean, there are few constraints associated with the soybean for its food uses. These are beany flavour of soy products and oxidative instability of soybean oil. Two major approaches have been used to overcome these constraints like innovative processing and through plant breeding. Now other means such as marketing efforts, medical discovery, consumer education and change in dietary habits are Cost ,Rs 75 200 250 400 480 600 900

The major health benefits from the regular use of soybean in daily diet are as under:

also needed. Acceptance of soy foods in India has been rather slow but now more and more people are tilting towards soy foods because of its economic, nutritional and health benefits. Different soy products: The primary interest in soybean in India has been the oil. However increasing attention is now being paid to the protein potential that it can offer. As of now 15% goes for direct food and feed uses,10% for seed and the rest for oil and protein extractions. The present soybean oil processing capacity is about 15 million tonnes of soybean and that for food uses is about one million tonnes. The Indian soybean Industry has capability to process soybean for food, feed and pharmaceutical applications. The major food uses of soybean as of now in India are edible oils, texturized soy proteins, flours, bakery products, milk/paneer(tofu), soy protein concentrates/isolates/hydrolysates and lecithin. Soybeans

Green soybeans

Meat analogs

Soy fibre

Soy flours

Soymilk

Sprouts.

Roasted beans

Soynut butter

Texturized soy proteins

Tofu

Applications of soy protein in Food:

Meat Food Products

Dairy type Products

Bakery Products

Miscellaneous Foods

Emulsified meats Coarsely chopped Meats Canned meats Poultry products Seafood products Analogs Pet foods

Beverage powders

Bread and rolls Soups, gravies, sauces

Cheeses Coffee whiteners Frozen desserts Whipped toppings Infant formulas Milk replacers For young animals

Specialty breads Cakes&cakemixes Doughnuts Breakfast cereals Pasta products Sweet rolls, cookies

Candies, confection Oriental foods Pet foods

pastry, crackers, snacks etc.

Action plans: The suggested action plans for promotion of soy foods in India are given below: 1. Awareness creation and generic promotion of soy foods. 2. Training of rural/urban groups at domestic level soybean processing. 3. Human resource and entrepreneurship developments. 4. Preparation of quality standards. 5. Establishment of soy food enterprises for manufacturing and marketing of soy foods. Future strategy: The need is to create awareness about soy products and their benefits and make available such products in the market through small scale decentralised soy foods processing enterprises. Domestic level processing and utilization of soybean for food and feed need to be given priority especially in rural sector. The centre and state developmental agencies may come forward and make implementation plan. The hardware and technology for a number of

soy foods matching with Indian food recipes and food habits are available. There is a need to make use of such indigenous facilities for the benefits of Indian people. Training of individuals, groups and entrepreneurs in manufacturing and marketing of soy based foods and machinery is the need of the day.

Starting a small soy food processing enterprise

Almost any one can be an entrepreneur but some people are better at operating a business than others. Different levels of entrepreneurial skills are needed depending on the level technology and the environment in which a business operates. Market survey: For selecting the specific product a short market survey is to be conducted and it will usually involve producing a feasibility report. It will start with the customer. Competitors: They are very important. The entrepreneur should know who is producing similar products, where are the competitors, what is the quality and price of their products, what offers or incentives do they give to retailers, what can the entrepreneur do make the new product better, why should a customer change to buy a new product and what are competitors likely to do if a new product is introduced? All this information will help him in deciding which food to make and go ahead. A note about new product: A good compromise is often found by modifying the existing product to create something different which would appeal to a new market. The need for a business plan: Feasibility study is to be conducted to gather information, analyse it and use the analysis to plan the business. The feasibility study has three components; 1. Market feasibility: market research, selling strategy, expected market size/share and competitors. 2. Technical feasibility: scale of production needed to meet market share, equipment, materials, services and labour needed for scale of production selected, quality control and distribution. 3. Financial feasibility; start-up costs, cash flow for one year, loan required, business developments over three years and profitability/sustainability. Planning for production: Sales and marketing: All products need promotion either to introduce them into the market or to increase the demand. This is achieved through the media (radio, TV, newspapers etc) or by posters, personal family contacts, discounts, new sales prices to retailers etc. A note on packaging:; Packaging not only protects the food against deterioration but also has a very important marketing role.

Technical requirements: The series of questions below is helpful. 1. Is a suitable building available? What modifications are needed? 2. Are services (fuel, water, electricity etc) available and affordable? 3. Are trained workers available and are their salaries affordable/ 4. Are enough raw materials available when needed and of the correct quality? 5. Is the cost of raw materials satisfactory for year round production? 6. Is the correct size and type of equipment available? 7. Are maintenance and repair cost affordable? 8. Is sufficient information and expertise available to ensure that the food is consistently made at the required quality? 9. Are suitable packaging materials available and affordable? 10. Are distribution procedures to retailers or other sellers established? Finance: Start-up costs: It is the total cost involved in buying or converting building, buying equipment, registering the business, training staff and buying packaging and initial raw materials. This is required to determine the money available with the owner. Operating costs: It can be divided in to fixed and variable costs. Fixed costs involve rent, labour, insurance, professional fees, maintenance/repair (building and equipment), loan repayment, interest charges, depreciation, business licences etc. Variable costs include raw materials, other ingredients, packaging, transport, electricity, fuel, water, labour, advertising, etc. Price of the product: The correct price is important to be able to enter the market and to sell the product at a profit. To calculate the breakeven point of production the costs need to be separated into fixed and variable costs. The following equation can be used: Fixed costs Revenue variable costs=Production level at break-even point. Profit and loss statement: A profit and loss statement shows income and expenditure over a fixed period. Cash flow forecast: A cash flow forecast is essential when starting a new business. It can be prepared for next three years. Preparing a business plan: The main considerations are to make the plan as easy to understand as possible by using simple language, include as much detail as possible and if necessary do thorough research first, look outwards from the business to judge what competitors will do and how the business will develop to become sustainable?. Registration and certificates: A new business must be registered with the local government authority. It also requires a certificate from the Bureau of Indian Standards, Ministry of Health or similar authority to show that the food products have been analysed and found to safe.

Premises and production facilities: Premises for food processing should be insect and rat proofed, made from materials that can be easily cleaned, have ceiling panels not rafters to prevent dust and bird droppings falling into foods and be large enough to work easily. The building should be supplied with clean water, power and fuel supplies. The equipment should be the correct size for the intended scale of production and should be laid out in the room to minimise the risk of cross contamination. Regular maintenance and cleaning schedules should be designed and managers should ensure that they are followed. Packaging and promotion: At an early stage of the business decide the design of the packaging and it should contain the following information: The name of the product, the net weight, and the ingredients in order of amount, the name and address of the manufacturer and the brand name, date of packaging, etc. Supplies: Make agreements with the suppliers of raw materials, packaging materials and services to supply the correct amounts at the right time. Internal organization and staff training: The entrepreneur cannot do all the jobs within the business, should employ people who have the skills that are needed. Quality assurance: The quality of the food product is very important. Quality assurance is a management system that is used to ensure a consistent product every time. Distribution and selling Transport, distribution and marketing costs are often a major expense to a small business. The entrepreneur has to ensure a distribution system that will enable products to reach customers on time and in the correct condition as economically as possible. Record Keeping: A small enterprise can use an account book and a cash book as a simple accounting system, otherwise an accountant may be needed. Taxation: It is necessary to register with the taxation authorities in order to avoid the prosecution later on and possible closure of the business. Pay the companys income tax, business tax, sales tax, excise tax, social security contribution and other contributions to employee benefits.

Finally it is concluded that there must be commitment and missionary zeal by all those involved in soybean production and consumption value chain. The backward linkage of industry with farmers would ensure the regular supply of good quality soybean suiting specific products and needs, through such an arrangements, all the partners namely farmers, processors and consumers involved in soybean value chain would be benefitted to great extent.