KENYA · GUIDE 0006 · EDITION 4.2
Spring Onion Farming Profit: Cost per Accepted Bunch
Price the bunch after the agreed trimming
Write the buyer’s crop identity, root treatment, stalk count or weight and delivery point on the quotation. Measure lifted material, preparation time, discarded outer leaves and usable stalks. A kilogram before trimming does not automatically equal a kilogram accepted by the customer.
Fictional example: prepared versus accepted
All figures below are invented to demonstrate arithmetic. They are not Kenyan market prices, a yield forecast, a supplier quote or an actual farm result.
| Fictional delivery | Amount |
|---|---|
| Bunches prepared | 70 |
| Bunches returned or rejected | 10 |
| Bunches accepted and paid | 60 |
| Assumed selling price | KSh 25 per accepted bunch |
| Revenue | KSh 1,500 |
| Attributable crop, trimming, ties and delivery costs | KSh 1,080 |
| Contribution before separately allocated overhead | KSh 420 |
Attributable cost per accepted bunch is KSh 1,080 ÷ 60 = KSh 18. Dividing by 70 prepared bunches gives about KSh 15.43 and hides the effect of unaccepted output. The KSh 420 contribution is not final profit; fixed overhead and other applicable costs still need consistent treatment.
Include alignment, roots and the return journey
Record the time to trim roots, remove soil or unwanted outer leaves, align stalks and tie bunches. A change from roots included to roots removed changes the work and possibly the saleable output. Agree the new specification before accepting an unchanged price.
If the retailer returns bunches that customers passed over because sizes appeared unequal, record the return and investigate the reference bunch. Include any extra journey to collect stock or containers. A visually full bunch may be chosen first even when nominal weights are similar; test the buyer’s actual display rather than treating this as a universal market result.
Keep unpaid revenue out of available cash
If KSh 1,000 of the fictional KSh 1,500 has actually been collected, KSh 500 remains outstanding. It cannot purchase the next input until received. Check the applicable invoicing route with KRA.
For a simple break-even estimate, divide fixed overhead for the same period by positive contribution per accepted bunch and round up. Zero or negative contribution cannot produce a useful positive break-even quantity. Replace every invented number with measured trial records and current quotations before investing.