Business Opportunities > Contract Breeding

Contract Breeding

I. Application Process

  1. Investor's Forum
  2. Submission of application form and letter of intent
  3. Site Inspection
  4. Processing of permits / Submission of requirements
  5. Start of Construction
  6. Completion of Farm and Dry Run
  7. Chick Loading - Start of Farm Operations

II. Investment Details

  1. Definition
    • It is an Agreement between SMFI and the Grower for the growing of broiler chicks to produce grown broilers:
      • at marketable size,
      • at the right volume,
      • at the right time
    • Meeting quality standards at the least possible cost.
    • Income is derived from farm production efficiencies
      • Harvest Recovery (HR)
      • Average Live Weight (ALW)
      • Feed Conversion Ratio (FCR)
    • It is NOT AFFECTED by market price or demand fluctuations
    • A sure and steady income
  2. SMFI's Undertakings
    • Day Old Chicks
    • Feeds
    • Vaccines and Medicinces
    • Technical Support
    • Laboratory Services
    • Delivery and Hauling Services
    • Competitive Payment Scheme
  3. Grower's Undertakings
    • Agricultural Land
      • Minimum of one (1) hectare
      • Must be within an agricultural zone / agro-industrial zone
      • At least 1 km away from nearest residential area or from nearest poultry/livestock farm and related operation
      • Within 80km radius from nearest SMFI operated processing plant
    • Production Houses
    • Controlled Climate System, Auto Feeding & Drinking Equipment
    • Support Facilities
    • Power and Water Supply & Distribution System
    • Skilled Labor
    • SMFI Requirements & Government Permits
    • Barangay Permit & Resolution
    • Mayor's / Business Permit
    • SEC Registration and Articles of Incorporation
    • DTI Registration
    • BIR Certificate of Registration (COR)
    • Official Receipt (OR)
    • Environmental Compliance Certificate
    • Audited Financial Statements
    • Disclosure Statement
    • Electrical Audit Certificate from SMFI accredited electrical contractors
  4. Standard CCS Poultry Building
    • CCS3 Elevated Houses
      • Pre-fabricated buildings with insulated walls and ceilings.
      • Elevated five feet (5ft) from the ground to facilitate manure collection
      • Ventilation fans in the basement
    • Advantages of CCS3 Elevated Building
      • Prevents fly proliferation
      • Removal of manure can be done on a regular basis without disturbing the birds
      • Prevents build-up of noxious gases
      • Faster cleaning time
      • Additional income from additional cycle per year
  5. Financials - Investment Cost

    Estimated Investment for 36k Capacity Broiler Farm

    Elevated Building
    Site Development 175,000.00
    Production Building 17,350,000.00
    Support Facilities 1,777,000.00
    Water Supply System 453,000.00
    Waste Water Treatment Facility 160,000.00
    Tools and Farm Equipment 474,000.00
    Permits 31,000.00
    TOTAL PHP 20,420,000.00
    ESTIMATED INVESTMENT COST PER BIRD PHP 567.22

    Financials - Operational Expenses

    Estimated Operational Expenses for 36k Bird Capacity

    Elevated Building
    Labor 3.12
    Power 3.35
    LPG 0.85
    Harvest 0.40
    Cleaning 0.55
    Vitamins / Medication 1.50
    Repairs & Maintenance 0.45
    Fly Control 0.40
    Operational Expenses per Bird per Cycle PHP 10.62

    Financials - Payback Period

    Comparative Payback Period

    Sample Grower's Fee
    Gross Income 26.40 24.98 23.09
    Operational Expenses per Bird per Cycle 10.62 10.62 10.62
    Net Income 15.78 14.36 12.47
    Investment 567.22 567.22 567.22
    Payback Period in Years, 7.77 cycles 4.63 5.09 5.86

III. Contact Details

For further information about doing business with San Miguel Foods, Inc - Magnolia Chicken, please contact:

Email Number
SMC Customer Care customercare@sanmiguel.com.ph (632) 632-2000
San Miguel Foods, Inc. Digital Marketing Team abascar@sanmiguel.com.ph

IV. Application Form

Click to download the application form below.
Download Contract Breeding Application Form