ict application for fish enterprise management - ACP Fish II

80 Pages·2013·2.15 MB·English

by  Reginald Oliver Severin

Annex 6
ICT APPLICATIONS FOR FISH
ENTERPRISE MANAGEMENT
Advance Fisherfolks Management Training Course (AFTC)

FIVE – DAY TRAINING MANUAL

REGINALD OLIVER SEVERIN
NOVEMBER 2012
A GUIDE TO FISH ENTERPRISE MANAGEMENT
Computer-Based Advance Training Manual
Table of Contents

Acknowledgement .............................................................................................................. ii
Foreword ........................................................................................................................... iii
Training Objectives ........................................................................................................... iv
Topics Covered ............................................................................................................. v - vi
About Sponsors and Authur ............................................................................................... ix
Modules …………………………………………………………………..……..…. 1- 67
MODULE I
UNIT 1: MANAGEMENT AS A WAY TO INCREASE PROFITS
Fishers are continually being exposed to changes that compel them to adjust their
operations in order to increase profitability and competitiveness. These changes stem
from the market, the development of new technologies and policy shifts. They impact on
the type of enterprises held, the quantity of inputs and supplies required and the method
and destination of fish products sold. Better management skills are needed by fishers to
respond to these changes.
This Unit starts with an examination of management and the decision making
process and concludes with a number of practical exercises.
RATIONALE......................................................................................................................2
SESSION 1.1 WHAT IS MANAGEMENT?...............................................................3
SESSION 1.2 WHY IS BUSINESS MANAGEMENT IMPORTANT?.....................7

UNIT 2: THE PLANNING PROCESS
The purpose of planning is to place the fisher in the best
possible position to make decisions about the future. Once the
fisher has defined his/her objective(s) the next step is to develop a
plan to achieve them within the opportunities offered by the
marketplace. This unit analyses the planning process!
The real value of creating a fishing enterprise plan is not in having the finished
product in hand; rather, the value lies in the process of researching and thinking about
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your business in a systematic way. The act of planning helps you to think things through
thoroughly, study and research if you are not sure of the facts, and look at your ideas
critically. It takes time now, but avoids costly, perhaps disastrous, mistakes later.
RATIONALE......................................................................................................................8
SESSION 2.1 THE PLANNING PROCESS...............................................................9
SESSION 2.2 WHAT ARE THE FISHER'S OBJECTIVES?....................................13
SESSION 1.3 HOW DO FISHERS DECIDE?..........................................................14

UNIT 3: UNDERSTANDING FISHING AS A BUSINESS
(WITH INTRO TO COMPUTERS)
This Unit explains the concept of the fishing operations and
its different enterprises and introduces the trainee to some of the key
terms used in management. These are costs of sales, gross income,
gross margin, enterprise profitability and gross profit (net income).
RATIONALE .....................................................................................................................16
SESSION 3.1 UNDERSTANDING AGRICULTURAL ENTERPRISES ................16
Gross Income .............................................................................................................16
Costs of Extraction ..................................................... Error! Bookmark not defined.
Fixed & Variable Costs ..............................................................................................19
SESSION 3.2 GROSS MARGIN................................................................................21
SESSION 3.3 ENTERPRISE PROFITABILITY ........................................................21
SESSION 3.4 GROSS PROFIT (NET INCOME)...................................................... 23

MODULE II
UNIT 4: ACCOUNTING FOR FISHERS Accounting for Agriculture deals
with the collection and analysis of financial information (data) and resources. The
knowledge of the type, quality, and quantity of resources available (Assets) and the
obligations or debts owned by the farm (Liabilities) are needed to ensure
that all resources are managed properly.
Fishers are required to know and keep up-to-date records of sales
(Income) and costs (Expenses) as it impacts on overall profitability. The
training also describes the calculation of Net Worth, examines the definition and use of
and preparation of Financial Statements, and assists the fisher in analyzing these
financial statements.
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The training course seeks to improve fishers’ appreciation for accounting and
provide guidance for developing, interpreting, and using accounting and record keeping
systems.
RATIONALE .....................................................................................................................24
ACCOUNTING FOR FISHERS .......................................................................................24
SESSION 4.2 RECORDS AND ACCOUNTS...........................................................26
SESSION 4.3 INTRODUCTION TO FINANCIAL RECORDS................................29
SESSION 4.4 DEFINING FINANCIAL ACCOUNTS..............................................34
SESSION 4.6 BALANCE SHEET.............................................................................38
SESSION 4.7 PROFIT AND LOSS STATEMENTS.................................................40
SESSION 4.8 INTERPRETATION AND ANALYSIS OF ACCOUNTS…..…..….44

MODULE III
UNIT 5: CASH FLOW MANAGEMENT
This Unit will examine the use of the Cash Flow in planning and as a tool
for evaluating the financial performance of the enterprise as a whole. A
cash flow budget guides decision makers in assessing whether the
enterprise is able to generate a cash surplus or incur a cash deficit and to
find the time of the year where additional financial resources may be required. The unit
reviews the concept of cash flow and discusses ideas for improving cash flow
performance.
RATIONALE……………………………………………………………………………47
SESSION 5.1 DEFINITION OF CASH FLOW…………………………………….47
SESSION 5.1 CASH FLOW ANALYSIS……………………………….………….48
CASH FLOW MANAGEMENT……………………………………………….………..49
CASH INFLOWS……………………….………………………………………………49
CASH INFLOWS……………………….………………………………………………50
SESSION 5.3 PRACTICAL APPLICATION OF CASH FLOW...…….………….48
SOLUTIONS TO CASH SHORTFALLS………………………………………………53

UNIT 6: PARTIAL BUDGETS AS A DECISION-MAKING TOOL
Management is concerned with the ways in which the fisher obtains and organizes
scarce resources to achieve the goals set by the business or family. Most decisions in a
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small fishing enterprise involve only one aspect of the entire operations; it may be the
need to upgrade the boat, adopt a new fishing technology or choose between one
technology, method, or technique over another.
Partial budgeting is a valuable instrument that assesses the effect of marginal
changes on overall profitability and enables the decision maker to select between
different. This Unit examines the use of Partial Budgeting in planning as a tool to assess
the profitability associated with changes that effect only part of the business.
RATIONALE....................................................................................................................54
SESSION 6.1 THE USE OF PARTIAL BUDGETING IN PLANNINGError! Bookmark not defined.
SESSION 6.2 STEPS IN PREPARING A PARTIAL BUDGET .............................56

UNIT 7: FISHING PERFORMANCE ANALYSIS

A performance analysis indicates if the fishing operation is functioning as it
should. Analysis of performance can be used to identify why certain operations are more
profitable than others.
Data needs to be collected that accurately reflects the performance and a set of
standards should be selected for measurement. A performance
analysis should be conducted periodically. Performance
indicators can draw on data collected over time from a particular
one operation/fisher or to other fishers located in the area.
RATIONALE .....................................................................................................................60
SESSION 7.1 SEQUENCE FOR UNDERTAKING PERFORMANCE ANALYSIS 60
SESSION 7.2 BENCHMARKING............................................................................. 64
SESSION 7.3 ANALYSING OVERALL PERFORMANCE .................................... 64

REFERENCES

About the only thing that can be achieved without much effort is failure!
Wes Izzard

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ACKNOWLEDGEMENTS

I give special thanks to the many individuals who has helped to develop this training
program which started out in 2005. Of particular importance is Mr. Norman Norris of
the Fisheries Division for his continued support of the Basic Course leading up to this
Advance Course along with his colleagues at the Division.

Special thank you goes out to Sandra Grant of the ACP FISH II Regional Manager
for the Caribbean, Mr. Gustavo Miranda, ACP Fish II Programme Coordinator, and
his colleagues Cristina Gonzalez Martin, John Purvis, and Alice Bulgarelli in Brussels
who made this management training programme possible.

I wish to acknowledge the valuable contributions of Marie-Bethsabee Santana,
Michaelle Nicholas, Mara Abraham, Stacy Jacobs, for keyboarding and data entry
services and Derrick Theophile in providing data.

I thank the Hon. Prime Minister, Roosevelt Skerrit for extending the opportunity to
work with the Fishers in Dominica and to my children and my dearest mum, Rosianna
Rosette Williams who remains my greatest inspiration.

I thank GOD for the gift to create and teach. Thank you Lord!

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FOREWORD
Dominica has chosen the cooperative business structure as the medium by which
fisher folk organizations are formed and developed. There are ten (10) Primary
Fisherfolk Organizations (PFO) that works at the community level addressing common
problems of fishers. The National Association of Fisherfolk Cooperative (NAFCOOP) is
a national umbrella organization that comprises the ten PFO. It was established for the
purpose of getting fisherfolks to be more involved in the decision making process and to
be a partner in co-management with the Government of Dominica on matters relating to
fisheries. NAFCOOP functions as the advocacy group for all its members.
The Government of Dominica would like to give more responsibility to these
organization such as the maintenance and management of Fish Aggregating Devices
(FADs) sponsored by Government of Japan under the Fisheries Master Plan pilot project,
license to import fishing gear and tackle, and to serve as the medium through which it
could most effectively grant rebate on fuel to fishermen. The Cooperatives do not yet
possess the necessary capacity to do.
The PFO’s are at varying stages of development, in-terms of strengths and level
of organization. Some are well organized with physical infrastructure, serve as marketing
agents for their members, and are experience in financial management. Others have no
infrastructure, assets or any defined strategy of achieving economic viability. This poses
a disincentive to the members which is the main cause of such groups falling apart. There
is a great need for institutional strengthening and capacity building among the primary
fisheries groups. This will allow for some degree of organization and growth of the local
economies of fishing communities and improvement in the livelihood of fisherfolks.
This training is therefore designed to build the necessary capacity and to
strengthen the membership of NAFCOOP for financial and operations management and
to boost the confidence of the members of the PFOs. This will help to strengthen and
build the smaller primary cooperatives which comprise NAFCOOP. Capacity building of
these institutions will enable them to take up their role as a group of direct stakeholders in
the management and development of the fishing industry in Dominica.
This Computer-Based Management Training Programme (CBMTP) is prepared
for the Fisheries Division based on recommendations and suggestion of the Agricultural
Management, Marketing and Finance Service of the Food and Agriculture
Organization (AGSF) , the Young Farmers Programme (YFP) Training Programme
(2005) and the Basic Fisherfolks Training Course (BFTC).
The programme has been designed particularly for use in Dominica amongst
fisherfolks desirous to developing commercially-oriented and technologically-driven
fishing enterprises. The manual addresses the current challenges facing fishers, their need
for a market-oriented approach to their trade and the development of management and
computer skills to enhance their competitiveness in both domestic and regional markets.
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The training is comprehensive in the range of topics covered and includes a
combination of classroom instructions and presentations, practical computer-based or
aided exercises, participatory group discussions and a model exercise. The main points of
each module are highlighted by a presentation of a basic computer application with focus
on Microsoft Excel application in fishing business management training.
The topics covered in the training will be delivered in three modules in actual training
situations and the sharing of experiences of many fisher folks operating in Dominica and
the experience gained has been incorporated into the training course material.

OBJECTIVES OF THE TRAINING MANUAL
The purpose of this training manual is to provide Dominica’s fishers, fisheries
regulators, and fishers’ co-ops with materials on the basic principles and tools of
management. Some fishers are generally technically proficient in fishing but often lack
understanding of business, internet and computer technologies (ICT), and economics and
their use in planning and operating profitable, efficient, and productive enterprises. This
programme provides advance training to these fishers. It is expected that with this
exposure to computer based business management training, they will be better equipped
to improving their management skills and love for record keeping.
Furthermore due to technological advances, smaller vessels operators/fishers are
getting much more effective at locating and catching fish and they are increasingly
engaged in fisheries that aim for marketing the products on the international market. Due
to increased pressures on inshore areas there is now mounting pressure to
“professionalize” the small-scale fisheries sector so as to make fishing effort
commensurate with the productive capacity of the resources.
The Manual and spreadsheets are useful tools for trainers, fisheries officers, fisheries
co-operative management, and other agricultural extension personnel to provide fishers
more specifically with:
1. An understanding of the principles of technical and financial efficiency;
2. Procedures for identifying technical and economic constraints in fishing;
3. Computer-based methods to analyze the performance of individual enterprises and
operations;
4. Skills in basic planning and management that assist fishers to respond to new
market opportunities.
5. An understanding that the principles and tools of management and planning is
important for all fishers.
6. An understanding and greater recognition of computer-based technologies in
fisheries management and fishing.

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ABOUT THE SPONSORS
The ACP Fish II Programme, entitled "Strengthening Fisheries Management in
ACP Countries" is funded under the 9th EDF (€30M).
Weak and ineffective governance of the world fisheries has led to the widespread
degradation and depletion of the natural resource base, resulting in greater poverty among
fishing communities, a decline in food security and, in general, in sub-optimal use of
fisheries resources. Weak policies and
institutional arrangements and ineffective legal
frameworks, combined with a lack of sectoral
strategy, have been widely acknowledged as
being a fundamental obstacle to effective
fisheries management, and therefore to
poverty alleviation and food security. Ineffective governance has also resulted in high
incidence of Illegal, Unreported and Unregulated (IUU) fishing depriving ACP countries
of substantial economic revenues.

Given that millions of people in ACP countries are dependent on fisheries for livelihood
and nutrition, it is crucial that ACP countries strengthen fisheries management, both at
the national and regional levels, by developing, implementing and enforcing sound
fisheries management measures so as to ensure availability of fish to local communities,
fish processors and exporters. Effective and sustainable management of fisheries
resources is thus the most important pre-condition to continue harvesting social and
economic benefits from fisheries and fish trade.
The ACP Fish II Programme, which became operational in June 2009, is primarily
designed to improve fisheries management in ACP countries and to reinforce regional
cooperation for the management of shared stocks.

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ABOUT THE AUTHOR
Reginald Oliver Severin
(ROSSE AGR SERVICES)
Mr. Reginald Severin is the manager of ROSSE
AGR SERVICES. He provides business
management and entrepreneurial development
extension services to small businesses and
producers of the agricultural and fisheries sectors
in Dominica.
Services offered are based sound economic and business principles in agricultural production
and aims to reinforce the existing technical-oriented extension services. These services include
but not limited to business planning, advising, forecasting, and management capacity
development through training.
ROSSE AGR services ‘seeks to support and strengthen opportunities that enhance
agricultural sustainability and provides the atmosphere for the development and protection of
agriculture, rural communities and peoples within a socio-economic and cultural framework.’
Mr. Severin vision lies in promoting agriculture and facilitating improvements in agricultural
productivity and management so that agriculture may become an economically viable and
socially equitable industry in Dominica.
Mr. Severin posses a Certificate in Farm Management and received practical training in small
Business Management at the Agricultural-Technical Institute of Ohio State University and
Fort Valley State University in Georgia, a Bachelor’s degree with upper class honors in
Agriculture Business Management, and graduate studies in Business Statistics, Business Law
and Ethics and Macroeconomics at Cameron University in Lawton, Oklahoma, USA.
In 2000, Mr. Severin obtained professional training in Sustainable Agriculture and Organic
Farming and Marketing at the North Carolina State University (Center for Environmental
Farming Systems) in Goldsboro, North Carolina.
Upon returning home in 2002, Mr. Severin had an assignment at the Woodford Hill Co-
operative Credit Union Ltd. where he developed and implemented the Small Business
Enterprise Development Programme while working as a freelance agribusiness development
specialist providing enterprise development planning assistance and training to both small
businesses and financial institutions in Dominica.
As one of the first trainer in the Basic Fishermen Training Course (BFTC) specializing in the
Management aspects of the training program, Mr. Severin has provided training services for
the Fisheries Division since 2005.

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