Success Case Replication of Bio Diesel Project in Nepal

1. Bio Diesel: Nepal Experiences (First Draft)
Success case Replication of Bio Diesel Project through
Cooperatives Societies in Nepal
[Potentiality, Concept, Methodology and tools]
Bio Diesel Cooperative Enterprise Analysis tool develop by
Ramesh Poudyal
SCR Expert-Nepal

2. Table of Content
Section-one
Nepal Experiences
Success Case Study of Jathopha Cuscus bio diesel in Nepal
Research and Finding in Nepal
Section –Two
How could Implement in Nepal?
Benefit of Jathopha Cuscus for Nepal.
Section –Three
Organization of Success Jathopha Cuscus Cooperative in Nepal
Definitions/Values/Methodology
Marketing through Cooperative
Business tool
Section Four
Success Case Replication of Jathopha Cuscus Cooperative

3. Methodology/Practice/Concept of SCR
Steps of SCR
Section Five
Secondary Replication of SCR in new Cooperative
Weakness of SCR Methodology
Annex #1
Annex # 2

4. Section -One
Nepal Experiences
Success Bio Fuel (Diesel) Project
Case Study
1. Prop writer Name: Mr. Moti Bhadhur Rai
2. Address: Simle VDC ward # 07; Therthum; Koshi Zone Eastern Nepal.
3. Registered Name of Industry: Shove Rice Mill -Simle
4. Milling Items: Rice ;Maize; Millets
5. Fuel : Bio Diesel [Using seeds of Jatropha Cuscus]
Mr. Moti Bhahadur Rai is residing in unit (Ward)# 07 of Simle VDC of Threthum District of Koshi
zone of Nepal. In the year 2005 he established a rice mill operated by diesel. After short period of
time there was big shortage of Diesel in the market in Nepal. Only authorized National Oil supplier
of Nepal (Nepal Oil Corporation) has provide him some limited quantities of diesel to run the plant
monthly basis. But that limit was good enough for 5-10 days only. After introducing people
hardship and live hood problem in this area one Dutch Volunteer visit and come to contact to Mr
Rai at his village. He informed to him that there is a possibility to run this plant using Jatropha
Cuscus seeds oil .Which is available in his village too. That is the great breakthrough
and inspiration of his life.
Afterward he collected Jatropha Cuscus seeds and extracted oil to replace the
Diesel. Since last two years his machine/plant is successfully running and operating

5. 10-12 hour per day. Later on Kathmandu based one of the leading bio energy
promotion company called Kristal bio energy Limited has been providing
technical; seed extraction and production technology to him.
After using Jatropha Cuscus oil he did not find any problem to run the Machine. Its
comparative price is almost 2/3 less than Diesel. Operating cost is less than half
then diesel fuel. According to his experiences it has no pollution/less operating
cost/ eco friendly, and has sustainable too.
Now many community of eastern zone of Nepal are organizing cooperatives based
on Mr Rai Success case experiences to replication the project.
In Ilam/ Panchthar/ Tamlejung and Jhapa districts Success Cooperative business
replication Specialist Mr. RAMESH POUDYAL has been providing technical assistant to
established such cooperative who has recently developed enterprise analysis tool to
develop success business cooperatives for bio fuel.
Success Refinery Case #2
There were two successes Jatropha Cuscus oil Refinery industries were
established in Nepal. Currently these two industry processing capacity is
about 20000 kg Jatropa seed. Both factory commercially producing bio diesel
in Butwal of Western development region and middle development region of
Chitwan district. These two industries were registered under company act of
Nepal and a total share capital is Nrs 1 millions. According to General Manager
of those factories there were no market problems of the product. And
commercially viable too. Major problems were insufficient quantity of raw
materials for processing.

6. Proposed plan in Nepal
Crystal bio-energy Nepal will have a mega farming project of jatropha curcas. 212
million plants are aiming to establish. Assuming of yielding fruits per plant is 8kg. Total
plants 212 million plants x8kg per plant 1696000000kg and 3.5 kg = one liter crude oil.
484571429 liter crude oil, wastes 11% to make pure bio-diesel(53302872 liter wastes),
pure bio-diesel 431268572 liter. And the rate of 40-(forty rupees). By-product glycerin
24228572 liter a by-product, press-cake 990000000kg=990000tons.
Section -Two
Implementation strategy in Nepal?
1. Most Potential project to Nepal
2. Under develop country like Nepal has tremendous opportunity to institutionalize
such kind of activities through success case replication on Cooperatives
Societies in all over the Country. It will providing a clean, renewable substitute
for imported fossil fuels, conserving the dwindling forest resources and other
biomass, the residue which remains after the seeds have been crushed is
potentially a nutritious animal fodder and can replace chemical fertilizers and so
help to preserve the role of organic fertilizers in traditional farming systems"
Cooperative societies will have excess marginal to middle level farmers in
management/generate income/self employment and for sustainable growth for
thousands of men and women.

7. 1.1 Nepal could benefited directly through Wasteland Reclamation and
Reforestation
• Income generation from previously Unusable areas
• provide huge opportunities from new sustainable and renewable land resources
and crops creating employment Nursery development, soil preparation, irrigation
systems, Plantation maintenance, seed collection, oil extraction and Refinery
control
• Nepal will also benefit from the increased demand for employment In
infrastructure, logistics and Transportation
• Renewable Energy
• Erosion Control and Soil Improvement
• Promotion of Women employment
• Poverty Reduction.
1.2 Bio-Diesel Benefits to Nepal and research finding
[Research data and recommendation were taken from Crystal bio energy company-
Nepal-2009and RECAST Nepal 2009]
The smartest technologies deliver benefits to multiple interests, including an improved
economy, and a positive impact on the environment and governmental policy.
The role of the bio-diesel industry is not to replace petroleum diesel, but to help create a
balanced energy policy with the most benefit to the government of Nepal. Bio-diesel is
one of several alternative fuels designed to extend the usefulness of petroleum, and the
longevity and cleanliness of diesel engines.
The ultimate goal is to contribute to building a stronger, more self-sufficient community
by way of a community-based bio-diesel production model. A community-based bio-
diesel distribution program benefits local economies, from the farmers growing the
feedstock to local businesses producing and distributing the fuel to the end consumer.
The money stays in the community while reducing impact on the local environment and

8. increasing energy security.
1.3 Easy to use,
One of the great advantages of bio-diesel is that it can be used in existing engines,
vehicles and infrastructure with practically no changes. bio-diesel can be pumped,
stored and burned just like petroleum diesel fuel, and can be used pure , or in blends
with petroleum diesel fuel in any proportion. Power and fuel economy using bio-diesel is
practically identical to petroleum diesel fuel, and year round operation can be achieved
by blending with diesel fuel.
1.4 Engine and vehicles,
All diesel engines and vehicles can use bio-diesel or bio-diesel blends. Certain older
vehicles built before 1993 may require replacement of fuel lines which contain natural
rubber, as bio-diesel can cause these lines to swell or crack.
1.5 Blending and switching with Diesel Fuel,
Bio-diesel can be used 100%(B100) or in blends with petroleum diesel fuel. Blends are
indicated by B##, which correspond to the % of bio-diesel in the blended fuel. For
example, a 20% blend of bio-diesel with 80% diesel fuel is called B20. When bio-diesel is
first used in a vehicle, it may release fuel tank deposits which can lead to fuel filter
plugging. After this initial period, a user can switch between bio-diesel and petroleum
diesel whenever needed or desired, without modification.
1.6 Availability, Power ,Performance and Economy
Many alternative fuels have difficulty gaining acceptance because they do not provide
similar performance to their petroleum counterparts. Pure bio-diesel and bio-diesel
blended with petroleum diesel fuel provide very similar horsepower, torque, and fuel
mileage compared to petroleum diesel fuel. In its pure form, typical bio-diesel will have
an energy content 5%-10% lower than typical petroleum diesel. However it should be
noted that petroleum diesel fuel energy content can vary as much as 15% from one
supplier to the next. The lower energy content of bio-diesel translates into slightly
reduced performance when bio-diesel is used in 100% form, although users typically
report little noticeable change in mileage or performance. When blended with petroleum
diesel at B20 levels, there is less than 2% change in fuel energy content, with users

9. typically reporting no noticeable change in mileage or economy.
1.7 Superior lubrication for Engines,
The injection system of many diesel engines relies on the fuel to lubricate its parts. The
degree to which fuel provides proper lubrication is its lubricity. Low lubricity petroleum
diesel fuel can cause premature failure of injection system components and decreased
performance. Bio-diesel provides excellent lubricity to the fuel injection system.
Recently, with the introduction of law sulphur and ultra low sulphur diesel fuel, many of
the compounds which previously provided lubricating properties to parodies fuel have
been removed. By blending bio-diesel in amounts as little as 5%, the lubricity of ultra
low sulphur diesel can be dramatically improved, and the life of an engine’s fuel
injection system extended.
1.8 Bio-diesel in cold weather,
Just like petroleum diesel fuel, bio-diesel can get in cold weather. The best way to use
bio-diesel during the colder months is to blend it with winterized diesel fuel.
1.9 Emission and greenhouse gas reduction,
Bio-diesel is the only alternative fuel to successfully complete the EPA’s rigorous
emissions and health effects study under the Clean Air Act. Bio-diesel provides
significantly reduced emissions of carbon monoxide, particulate matter, unburned
hydrocarbons, and sulphates compared to petroleum diesel fuel. Additionally, bio-diesel
reduces emissions of carcinogenic compounds by as much as 85% compared with
petroleum diesel. When blended with petroleum diesel fuel, these emissions reductions
are generally directly proportional to the amount of bio-diesel in the blend.
1.10close/contact/benefits/from/the-"French/fry-fuel”
The reduced particulate and unburned hydrocarbons emissions that result when using
bio-diesel are a welcome relief in environments where workers and pedestrians are in
close proximity to diesel engines, including public transport, mining, and construction. In
addition, when high blends of bio-diesel are used, the exhaust from diesel engines is
often described as smelling like fried food, which aside from causing increased hunger in
those nearby , is a welcome relief from the smell of diesel fuel exhaust.
1.11A-clean-alternative-fuel-for-new-and-old-engines

10. Diesel engines have long had a reputation of being “dirty” engines. However, with the
advent of newer diesel engines equipped with exhaust gas recirculation(EGR),
particulate filters, and catalytic converters, clean diesel technology provides incredible
fuel efficiency with ultra low emissions levels. When coupled with the use of bio-diesel,
both new and old diesel engines can significantly reduce emissions, including particulate
matter(black smoke).
1.12 A closer look at emissions reduction,
Studies on bio-diesel emissions have been conducted for almost 20 years. In that time
bio-diesel has undergone the most rigorous testing of any alternative fuel, having been
the first and only fuel to be evaluated by the EPA under the Clean Air Act Section 211(b).
this study examined the impact of hundreds of regulated and non-regulated exhaust
emissions, as well as the potential health effects of these emissions.
1.13 Some of these results are summarized below.
Average exhaust emissions for 100% bio-diesel compared to petroleum diesel fuel*
Particulate-matter-47%
Carbonmonoxide-48%
Total-unburnedhydrocarbons-67%
Nitrogenoxides+10%
Non-regulated-emissions
Sulfates-100%
Polycy-clicaromati-chydrocarbons(PAH)80%
NitrateP.aromatic-hydrocarbons(-nPAH)90%
SpeciatedH.ozoneformingpotential-50%
“acomprehensive-analysis-of-bio-dieselimpactsonexhaustemissions”.
1.14 Explanation of emissions types,
Particulate-matter(black-smoke)
Emissions of particulate matter have been linked to respiratory diseases and are
generally considered to be a human health hazard. Emissions of particulate matter are
reduced with bio-diesel by 47%.
1.15 Carbon monoxide,

11. Carbon monoxide is a poisonous gas. Reduced with bio-diesel by 48%.
Total unburned hydrocarbons, Compounds which contribute to localized formation of
smog. Reduced with bio-diesel by 67%.
1.16 Nitrogen oxides,
Compounds which contribute to localized formation of smog. The average increase of
Nitrogen oxide emissions from bio-diesel is 100%, depending upon the test used in
obtaining the data.
1.17 Sulphates,
Sulphates are major contributors to acid rain. These emissions are practically eliminated
when using bio-diesel.
1.18 Polycyclic aromatic hydrocarbons(PAH and nPAH),
These compounds have been identified as carcinogenic (cancer causing) compound. Bio-
diesel reduces emissions of these compounds by up to 85% for PAH compounds and
90% for nPAH compounds.
1.19 Speculated hydrocarbons,
These compounds contribute to the formation of localized smog and ozone. The
potential for smog formation from Speculated hydrocarbons is reduced by 50% when
using bio-diesel.
1.20 Life cycle reduction of carbon dioxide,
Bio-diesel helps reduce the risk of global warming by reducing net carbon emissions to
the atmosphere. When bio-diesel is burned , it releases carbon dioxide to the
atmosphere, but crops which are used to produce bio-diesel take up carbon dioxide from
the atmosphere in their growth cycle. A joint study conducted by the US Department of
Agriculture, and
The US Department of Energy determined that bio-diesel reduces net carbon dioxide
emissions to the atmosphere by 78.5% compared with petroleum diesel fuel.
1.21 Energy Balance and Security,
The energy balance of a fuel is a ratio of how much energy is required to produce, refine
and distribute the fuel compared to the amount of energy the fuel releases when it is

12. burned. This property is used to determine how “renewable” a fuel is. A higher ratio
indicates a lower environmental impact, as less fossil energy is needed to produce,
refine and distribute the fuel. Bio-diesel has a very high energy balance compared to
other alternative fuels. A joint study found that on average bio-diesel releases 3.2 units
of energy for every one unit of fossil fuel energy used to produce it*. For comparison,
diesel fuel delivers only 0.83 units of energy for every unit of fossil fuel energy used to
produce it.
1.22 Grown, produced and distributed locally,
Worldwide, energy security is becoming a hot topic in government and society. Nearly
every country in the world depends on imports of various forms of fossil fuel energy,
including oil, coal and natural gas. Without a steady supply of affordable energy a
country’s economy grinds to a halt, with no fuel for transportation, energy to run power
plants and factories, or heat homes. Bio-diesel can improve energy security whenever it
is produced in several ways:
1.23 Domestic energy crops,
When crops used to produce bio-diesel are grown in the country in which the fuel is
consumed, each gallon of bio-diesel displaces a gallon of imported crude oil, reducing a
country’s dependence on foreign oil supplies.
1.24 Increased refining capacity,
Bio-diesel is produced in dedicated refineries which add to overall domestic refining
capacity, eliminating the need to import expensive finished product from other
countries.
1.25 Difficult targets,
When bio-diesel is produced, distributed and used locally in a community based model it
presents a much more difficult target for a potential terrorist attack than large
centralized facilities like oil refineries or pipelines used the petroleum industry.
In the United States, the bio-diesel industry is supported by the Energy Policy Act (EPA)
compliance strategy. This legislation allows EPA act covered fleets (federal, state and
public utility fleets) to meet their alternative fuel vehicle purchase requirements simply

13. by buying 450 gallons of pure bio-diesel, and burning it in new or existing diesel vehicles
in at least a 20% blend with diesel fuel. The congressional Budge Office and the US
Department of Agriculture have confirmed that the bio-diesel option is the least cost
alternative fuel option for meeting the Federal government’s EPA act compliance
requirements.
1.26 Toxicity, biodegradability, safety & recycling,
Though it is uncommon for the average person to come into direct contact with fuels,
occasional spills do occur, and the impact of the fuel on plants and animals must be
considered. Bio-diesel has been proven to be much less toxic than diesel fuel, and is
readily biodegradable. These attributes make it less likely to harm the environment if an
accidental spill occurred, and far less costly to repair damage and clean up.
1.27 Less toxic than table salt,
Being derived from vegetable oils, bio-diesel is naturally non-toxic. The acute oral LD50
(lethal dose) of bio-diesel is more than 17.4gkg. by comparison table salt (Na C1) has
an LD50 of 3.0gkg. this means that table salt is almost 6 times more toxic than bio-
diesel.
1.28 Aquatic impacts,
In an aquatic environment, bio-diesel is 15 times less toxic to common species of fish
than diesel fuel.
1.29 Bio-degradability,
In both soil and water, bio-diesel degraded at a rate 4 times faster than regular diesel
fuel, with nearby 80% of the carbon in the fuel being readily converted by soil and water
borne organisms in as little as 28 days.
1. 30 safe and stable fuel,
Bio-diesel is safer to handle than petroleum fuel because of its low volatility. Due to the
high energy content of all liquid fuels, there is a danger of accidental ignition when the
fuel is being stored, transported, or transferred. The possibility of having an accidental
ignition is related in part to the temperature at which the fuel will create enough
vapours to ignite, known as the flash point temperature. The lower the flash point of a

14. fuel is, the lower the temperature at which the fuel can form a combustible mixture. For
example, gasoline has a flash point of -400 F. bio-diesel on the other hand has a flash
point of over 2660 F, meaning it cannot form a combustible mixture until it is heated
well above the boiling point of water. It is rare that fuel is subjected to these types of
conditions, making bio-diesel significantly safer to store, handle, and transport than
petroleum diesel. In fact, many researches and studies the have classified bio-diesel as
a non-flammable liquid.
1.31 Recycling: recovering energy resources,
Bio-diesel can be made from many different oils and fats, including many waste
products. Waste cooking oil, normally disposed of or used in animal feed mixtures can
be converted to high quality bio-diesel using a process employed by companies such as
pacific bio-diesel technologies. The use of used cooking oils as a bio-diesel feedstock has
increased their value significantly in recent years, making proper collection and
recycling of these oils more cost effective, and lowering the volume of these oils
destined for sewers and landfills. Other low value oils and fats which can be made into
bio-diesel include yellow grease, inedible tallow, and trap grease. In one example of the
benefits of how bio-diesel production can increase recycling, the pacific bio-diesel
production facilities in the Hawaiian islands have diverted nearly 190,000 tons of used
cooking oil and grease trap waste since they began production.
1.32 Economic development,
Since bio-diesel is a fuel which can be created from locally available resources, it’s
production and use can provide a host of economic benefits for local communities. The
community based model of bio-diesel production is particularly beneficial. In this model,
locally available feedstock are collected , converted to bio-diesel, then distributed and
used within the community. This model keeps energy dollars in the community instead
of sending them to foreign oil producers and refineries outside the community. The
peripheral benefits of this type of model are different for each case, but can include:
-increased tax base from bio-diesel production operations.
-jobs created for feedstock farming and or collection.
-skilled jobs created for bio-diesel production and distribution.

15. -income for local feedstock producers and refiners.
1.33 Sustainable farming and value added agriculture,
Bio-diesel feedstock can come from a variety of agricultural crops. When these crops are
grown in a sustainable manner, using good stewardship practices, there are long term
benefits to farmers, farming communities and the land. Many crops which yield oils used
for bio-diesel production can be a beneficial rotation for other food crops, including
soybeans when used in a traditional corn rotation, and canola when used in a wheat
rotation. Using crops in rotation can improve soil health and reduce erosion. The overall
impacts of growing energy crops are complex, with thousands of variables. However, the
added value created for oilseed crops by the production of bio-diesel is a tangible
benefit for farming communities, and when coupled with sustainable farming practices
can provide benefits to farming communities and the environment.
1.34 Sustainable bio-diesel production,
Since there are multiple feedstock from which to make bio-diesel, plant operators can
opt for the least expensive feedstock currently available, if they have a multiple-
feedstock system. This flexibility makes producers less subject to price fluctuations.
One example of this is noted by the prices of soybean oil. Its price has doubled in recent
years, and is predicted to continue to rise according to a 2001 study by the US
Department of Agriculture. The study projects a total cash crop increase of $5.2 billion
by 2010--an average net increase to farms of $300 million per year--with soybean prices
increasing 17 cents per bushel annually over that period.
1.35 Every body wins,
Ultimately this creates multiple beneficiaries of the production of bio-diesel. By virtue of
a successful market and feedstock flexibility, plant operators and farmers can both
continue to operate in a marketplace with increases in revenue.
1.36 Legislative support and policy making,
Many countries have bio-diesel program, such countries are given legislative support
and have drawn up a National policy on bio-diesel development.
In Nepal, a national level mission has to be organized to cover all aspects of bio-diesel
development programs such as Nursery Development, Procurement of seed, Extraction

16. of oil, Trans-etherification (refining of oil), Blending and Trade, Research and
Development, Education and Trainings, Funding, and follow up program. Therefore, we
request that the Government of Nepal provide the following: Standardization of hybrid
seed of Jatropha curcas.
Disused land, marginal land, forest depleted land, and encroachment land of the
government of Nepal should be provided to the farmers and professional entrepreneurs.
Land registration fee and land revenue should be waived for professional farmers for
non-edible oil borne seed farming especially based on Bio-diesel program.
Loan process and easy funding system should be developed and the low interest
program should be declared by the government of Nepal for the first two years of
plantation of Jatropha curcas (bio-diesel plants)
As an economic incentive, the government of Nepal should declare a 90% income tax
reduction for bio-diesel production companies and bio-diesel plants farming
programmers.
Additionally, all related equipment required to produce bio-diesel should be exempt
from excise duty. And
Proposed Training Toolkit Outline of Cooperative Enterprise
Development
OUTLINE
Module # 1 : Business Planning

17. 1.1 What is a business plan? Why a Business Plan and what is the Structure
of a Business Plan?
1.2 Market Based Business Planning?
1.3 Risk Assessment! Concept of Risk Management!
1.4 Choice of Production or Service for Cooperative Enterprise Development.
1.5 Business Sustainability in Cooperatives.
1.6 Log-frame Analysis and Planning.
Module # 2 : Input Planning for Cooperative Business
2.1 Raw Materials/Input/Labor/Technology.
2.2 Assessment of Supply Channel/Cost/Risk
Module # 3 : Financial Planning
3.1 Cost of inputs (Raw Materials/Appliances Packaging)
3.2 Financial Inputs (loan/share/saving/etc)
3.3 Expected Income (at least more than US@ 1/day)
Module # 4 : Skill Development
Through success case replication methodology
4.1 Locate and Identify Success Case.
4.2 Ascertain the economic validity of the Success Case.
4.3 Establish the Success Case Replication Training
4.4 Establish criteria for selection of the Trainee Cooperatives.

18. 4.5 Secure funding for the training.
4.6 Arrange the necessary follow-up.
Module # 6 : Costing and Marketing of Cooperative Production
6.1 Elements of Costing
6.2 Pricing & Marketing Concept in Business.
Module # 7 : Saving and Credit Business in Cooperatives
7.1 "5" Concept of Credit.
7.2 "PEARL" Models of Business Analysis.
7.3 Loan without Collect (Group Leading)
7.4 Loan Portfolio Analysis.
7.5 Effective rate of Interest on Saving/Credit.
7.6 Scaling-up Saving/Credit Business/viability Plan.
Module # 8 : Participatory Impact Monitoring (PIM)
8.1 Concept, Methods & Technique of PIM.
8.2 Monitoring Reporting System.
8.3 Follow-up System & Execution of Monitoring Reports.
Module # 9 : Cooperative Membership Participation in Cooperative
Business

19. 9.1 Gender responsive Cooperative Business Planning
9.2 Dropout/Dormant/and Active Members are effective & Impact in
Business Promotion
Module # 10 : Geometric Replication of Success Case (SCR)
10.1 Ten steps of SCR
10.2 Follow-up Schedule of SCR
10.3 Supervision and Monitoring of SCR
Module # 11: Business Networking with Partners Organization
11.1 Public/Private/Government/Trade Faire/Wholesale/Retail
11.2 Local/District/National/International Linkage
Market and Marketing linkages and Issues of agriculture
cooperatives
With the growing interest in activities to link farmers to markets it seems essential
that low cost methods of exchanging experiences must be found and cooperatives
should consider how best to exchange experiences at international level in order to
avoid constant reinventing of the wheel. At national level, government, donors and
cooperatives should establish market linkage coordinating mechanisms to facilitate

20. the exchange of information and avoid competition for the chance to work with
promising market outlets and potentially viable farmers.
Cooperatives to
Fig1: Existing Production Marketing Linkages of Primary Cooperatives
Leading Farmers
Export to Indian Cooperatives to
Market and Intl. Domestic Traders
Market
Coops to Agro- Export to Tibetan
Primary
Processing Uni Market
t Agro-
Producers
Cooperatives
Cooperative
Cooperatives to
s to
Wholesalers
Retailers
Farmers
Group
Farmers Farmers
Coordinatio
Group Group
n to
Quality
Marketing
Control
Agents Coordinatio Trainin
Supply
n to Private g
Guarantee Information Sector
d Sharing
Fig – 2: Role of District Cooperative Union to Develop Production Marketing for their
Members Cooperatives. Individual Farmers
District Cooperative Union
Primary Agro Producers

21. Maintain
Relationship
with Donors
Pay back
Guaranteed to
the Farmers
Maintain
Linkage with
Information International
Sharing Agent
Fig – 3: Role of Central Union to Develop Production and Marketing Linkages of Agro-
Producers Cooperatives.
Provide
Explore Training
Domestic
National/Inter
national
Market
Important
Central Cooperative Union
Section -Four
Success Business Replication of Jatropha
District Union
Primary

22. Concept, Practice and Methodology
The Success Case Replication (SCR) methodology differs from normal
government/NGOs/INGOs sponsored training in the following ways
The training is not conducted in a government training center. Training is conducted at
the site of the
1. successful cooperative marketing enterprise. This “on site” training eliminates
the need to build a training center.
2. The training is not conducted by government officers or trainers. Training is
conducted by the management and staff of the successful cooperative. This
training is often conducted free of charge by the successful cooperative or at very
low costs per trainer as compared to high cost government trainers.
3. The training is not based on textbooks or on theoretical blackboard presentations
by government instructors. Training is “fully practical” and “hands on” with the
trainees observing the management, staff and members of the successful
enterprise in action and then themselves practicing each step of the successful
marketing enterprise. For example, the book keepers learn how to keep
marketing records and then practice the process during an actual product sale.
The marketing officer learns how the coop strikes daily price agreements with the
product buyers and then he actually conducts a bargaining session with a buyer.
The trainee who is a vegetable producer observes the planting, maintenance and
harvesting processes as demonstrated by a successful member vegetable grower.
The trainee then practices each step of the process in the field of the successful
cooperative member.

23. 4. When the members of the trainee cooperative return home and begin the
“Replication” process, they will, inevitably, encounter problems as with all new
marketing enterprises. Follow-up corrective action is required to solve these
problems. It can take the form of a visit back to the successful cooperative by the
trainee cooperative to seek advice or it can involve a member of the successful
cooperative coming to the new site to give advice. The government cooperative
promotion agency should assist with this all-important problem solving follow-up.
5. When the trainee cooperative has become successful in its new marketing
enterprise, then the staff of the government cooperative promotion agency should
document this new success case to substantiate the economic benefits gained by
the members. Once the success case replication has proven fully successful, then
this new cooperative enterprise can be used as an SCR training center to promote
multiple replications of the successful enterprise. The replication process to new
marketing cooperatives must be limited so that the market will not suffer from over
supply and falling prices, which will harm both the success case and the trainee
cooperatives.
(a) What is Success Cooperative business replication?
Success Case Replication is :
a simple, cost-effective and Self-reliable training methodology.
How does Success Case Replication differ from other training systems?
The successful persons design the training course and conduct the training.

24.  the successful persons follows up progress in replication and help trainees to
overcome problems.
Basic Philosophy of Success Case Replication
 It is based on human nature.
 All humans observe and imitate their more successfull peers.
How does Success Case Replication work?
Locate agricultural cooperative societies which are successful in achieving
high incomes for their members.
 Utilize the “Successful Agro Cooperatives” to train other less successful
cooperatives or help establish new cooperatives.
How does Success Case Replication provide practical “Hands-On" training?
 Training must be “Hands-On” with each trainee carrying out each activity.
 SCR training must cover RPM:
R = Raw materials,
P = Production process, and
M = Marketing.

25. Why is Success Case Replication self-reliant?
 Villagers come to realize that they can learn from similar cooperatives rather
than waiting for outside professional training.
 SCR reduces dependency on other sources of help.
 SCR identifies successful persons or cooperatives in the local area and uses
them as models.
 SCR elevates the managers, staff and members of these success cases
(cooperatives) to become teachers of their peers.
Why is Success Case Replication cost-effective?
 The successful person lives in the local areas.
 Training is often given free of cost by the successful person, or he/she asks for a
much lower pay rate than is paid to government trainers.
 The successful cooperative or enterprise is used as the training site.
 It eliminates the need for an expensive training center.
 He/she is available to help his/her trainees if they encounter difficulties.
Strengths of the Success Case Replication Methodology
 It is a simple training system.

26.  It is an appropriate and powerful training tool for AURA (Are uready for
Action)Areas
 It involves low risk since it is based on locally proven technology
 It helps to overcome problems of local cooperatives
 It is locally familiar and tested
 Villagers serve as teachers/resource persons. Its advantages are:
 Familiar with local customs
 Speak local languages
 Come from the same social setting/economic status
During training at the successful cooperative:
 Trainees see the actual working enterprise.
 They believe they can replicate their peers.
 They benefit from "Hands-On" training.
It equalizes social status since:
 Trainers and trainees come from the same community.
 They are usually of the same or similar social status.
 Similarities encourage confidence to replicate the success.
It has many applications as follows:

27.  Can use any technology.
 Individuals groups or even large institutions can be replicated.
The successful person lives in the local areas.
 Training is often given free of cost by the successful person, or he/she asks for a
much lower pay rate than is paid to government trainers.
 The successful cooperative or enterprise is used as the training site.
 It eliminates the need for an expensive training center.
 He/she is available to help his/her trainees if they encounter difficulties.
Why does it work at the grassroots level?
Successful people at the local enterprise level:
 Overcome local problems.
 Have valuable experience.
 Grassroots community approach (as against top-down approach)
 Local people select success cases for training.
 Local people determine if the enterprise is viable.
 They make matches based on local experiences and values.

28.  Training is relevant to the community
 Enterprises have demonstrated success.
 Trainers have practical skills.
 Trainers are conversant with local constraints.
Section-Five
SCR Methodology
Stages of Success cooperative Business Replication
P
There are a total of eleven stages of the Success Replication Methodology.
The Eleven Steps
Step 1: Locate success cases
Step 2: Ascertain if the success is “replicable”
Step 3: Assess trainers “willingness” to train
Step 4: Identify and select trainees
Step 5: Match trainer to the trainees
Step 6: Establish practical “hands-on” training program
Step 7: Supervise training
Step 8: Plan the business with the COOP

29. Step 9: Access credit
Step 10: Arrange follow-up with business development services
Step 11: Achieve secondary “multiplications
Step 1: Locate Success Cases
• Most villagers and member of cooperatives can tell you who is most successful
among their peers (Leave these examples out if you do not plan to include the
stories)
• Ask people in the same occupation or with the same enterprise.
• Praise the Successful Person to get his interest (Normally skeptical until praised)
Offer the chance to become a “Teacher” to his peers to promote cooperation
Step 2: Find Out if Success Case is Replicable
• Net Profit (conduct net profit example)
• Viable Production Process
• Price Stability (eggs in Thailand)
• Limited Market Capacity (Palm sugar cakes)
• Unlimited Capacity (is desirable)
• Unfilled Market Demand (is helpful)
Step 3: “Willingness” to Train
• Many are willing to train
• But Market Analysis necessary
• Desire to become teacher may lead the selfish to hide their secrets of success.

30. Step 4: Carefully Select Trainees
• The determine interest level (fruit trees)
• Visit success case site to familiarize
• Do not pressure the skeptical (high failure rates when motivation low)
• Assets and start up cash essential)
• Selection improves rapidly over time (Patiya mat 2 /5, then 10/10: Mooda
P
stool 1/5 and then 5/10)
Step 5: Match Trainer to the Trainees
• Similar market access
• Location of trainee and trainer
• Transportation and accommodation
• Same social level
• Similar assets and access to credit
Pre-training visit essential
Step 6: Practical “Hands-on” Train
• Success case person best designer of course content
• Emphasize the successful cooperatives problem solving during training
Step 7: Supervise Training
• Complete coverage of R = Raw Materials, P = Processing, M = Marketing.
• Special emphasis on marketing.
• Reduce need for corrective follow-up
• Quality control

31. Step 8: Plan the Business with the Graduate
• Secure funding
• Identify location
• Build or renovate
• Infrastructure-Water, electricity etc.
• Permits
• Tools/equipment
• Supply of raw materials
• Start production
• Control quality
• Devise sales strategy (See Annex 24 and 25)
Step 9: Access Credit
• Credit Essential
• Sources of credit
• Attempt to link to existing institutions for sustainability
• Project provides grants and loans
• Loans: field workers collect
Step 10: Arrange Follow-up Assistance
• Most new enterprises encounter problems
• Success case person or cooperatives is key “Problem Solver”
• This assistance can make or break new enterprise
Step 11: Secondary Multiplications[Please see below Section Four]
Section-six

32. Procedures and Methodology of Secondary Multiplications
(a) Second Generation Multiplication
• Alert all trainees before training starts – that they may well train in the future
• Keep within market limitation
• Accelerate group activities
(b) Cost Benefit Records
• Know the VALUE of your programme to convince yourself and the donor
• Costs = staff time and training costs
• Benefits = net income first year
• Divide the costs by the benefits to obtain
Cost/Benefit Ratio
( C) Case-Replication, Why Does it Work at the grass roots level?
Successful people with local enterprises have
• Overcome local problems
• Valuable experience
(d)Villagers as Teachers
• Familiar with local circumstances
• Speak local language
• Come from same social level
(e)Realistic Success Model
• Trainees see the actual working enterprise
• They believe they can replicate their peers

33. • They benefit from hands on training
(f) Strengths of the Philosophy
• Simple Concept
• Powerful Tool
(g) Risk Reduction
• Based on locally proven technology
• Problems already overcome
• Familiar and tested
• Familiar and tested
(h) Many applications:
• Can use any technology
• Can replicate individual, group or even large institution
(i) Low Cost:
• Trainer is often free or at very low cost
• Training costs are usually minimal
Weaknesses of the Methodology
1. Does not replace conventional training/extension:
• Technical training and extension essential to progress
Can accelerate tech transfer by “replicating” successes already achieved with
conventional technical training
2. Depends on local success cases:
• Absence of local successes

34. • Absence of market
3. Transferring success across barriers:
• Local circumstances may determine success
• Physical and cultural barriers (bamboo, hilltribe trainers)
4. Requires commitment of trainees:
• Poor trainee selection means low success
• Cultural sensitivity and judgment involved
• Selection improves over time
5. Requires honest trainer:
•Holding back on business “secrets”
•Assessing real “willingness”
6. Market Oversupply:
• Unlimited markets
• Limited markets
• Uncontrolled multiple replications
• 7. Attitude of Field Staff:
• Critical “catalyst” essential to SCR
• Attitude can endanger method
8. Cost Benefit Records
• Know the VALUE of your programme to convince yourself and the donor
• Costs = staff time and training costs
• Benefits = net income first year
• Divide the costs by the benefits to obtain
Cost/Benefit Ratio

35. 9. Market Opportunity Survey
• Unsatisfied DEMAND for product
• Potential for EXPANDING/IMPROVING
• Sources for financial and technical assistance
• Other producers of same product
Market competition
Annex #1
Questioners' for Success Case
Identification
Stage One: Location of Success Case
1.1 Success Case Name : __________________________________________
1.2 Address: ___________________________________________________
1.3 Contact # : ____________________ 1.4 Date of Establishment : __________
1.5 Working VDCs : ______________ 1.5 Business Area : ________________
1.6 Total Members: ________ Male __________ Females ________
1.7 Boards Members ________ Male __________ Females ________

36. 1.8 Membership __________ NCF; DCU _________ Others _________
1.9 Membership Compositions: Dalit ______; Janajati ______ Underprivileged ______
others
Stage Two: Set Up System/Consultation
2.0 What prompted setting up this business cooperative: ______________________
2.1 How was it done: __________________________________________________
2.2 What is your source of information or facilitation: _________________________
2.3 Did you know of other exiting businesses that are successful in this area? and How
did it encourage you ? __________________________________________
2.4 What was the most difficult problems _____________________________ in establishing it
as a cooperative business? ________________________________
How were they solved?
(a) ___________________________________________________
(b) ___________________________________________________

37. (c) ___________________________________________________
Problems How Resolved
Stage Three: Variety of Success Case
3.1 Did any NGO or COBs or Bank help to provide information to set up Business
cooperatives? _____________________________________________________
3.2 Do you have a positive balance sheet ? or, are you in debt ? What is you strategy to
increase your profit margin? _______________________________________
3.3 Do you have any business analysis (Record/Idea) by which you were may Confident
that this Business may definitely could get success? _______________
__________________________________________________________________

38. Stage Four: Technology of Market Refinements
Technology Difficulties How solved
• Vegetables & Fruits
• Coffee
• Herbs
• Multipurpo
• Others
• Rural Services
Stage Five: Standards & Technology related to Production & Marketing
3.4 How did you identify Market opportunity? ______________________________
3.5 How long did you take to run this cooperative at least in marginal profit?
________________________________________________________________
3.6 How did you manage your total financial need to run these Business cooperatives?
______________________________________________________

39. Is the market changing rapidly for your type of product? ___________________
3.7 When market oversupply does not appear to be a problem? Then what you
probably to ? ______________________________________________________
How did you adjust you operation to the changing market? Do you have difficulties
in the marketing process? What are these? How were they solved? __-
__________________________________________________________________
Stage Six: Profitability and Marketability
1. Does your Cooperatives ______ on a profitable margin ?__________________
2. How efforts are made to maintain of profitable margin ? ___________________
3. What efforts are made to _________ loss into profit ? _____________________
4. What are the main obstacles? _________________________________________
5. What efforts made to overcome those obstacles? __________________________
Total Production at Coop level
Total Ave. Revenue NRS Share of Women

40. at member level Women Participation
Other marginalized groups
Second Item : Cash Cost
S.N. Particular NRs.
1.
2.
3.
4.
5.
Total Cash Costs
Total Production : ___________________________________________________
Total Income NRs. ___________________________________________________
Less Cost NRs. ___________________________________________________
Net Profit ___________________________________________________

41. Stage Nine : Successful Case Person Identification/Catalyst Agent
6.1 Cooperative Manager. What ? How? With Major Functions ! _______________
6.2 Individual Members. What ? How? With Major Functions ! ________________
6.3 INGs/CBOs/ Individual etc. How ? What ? ______________________________
6.4 AGM's role to make it become success Role ? ____________________________
Training Facilities in the Successful case Site for replication _______________________
Member to member training for SCR Facilities ? Venue/Accommodations/Cost _______
Follow up after Training ? _________________________________________________
Ownership and Governance
2.1 Share Capital Nrs __________ 2.2 Frequency of AGM ______
2.3 Frequency of Regular Board meeting __________________________________
2.4 Board minuet [Yes] [No] 2.5 Audit [ Yes ] [ No ]

42. 2.6 Organization Structure [Yes] [No] 2.7 Work Division [ Yes ] [ No ]
2.8 Annual Budget Nrs. _____________ 2.9Annual Plan and Programes ____
2.10 Management Policy [Yes] [No]
2.11 Member's Average Income Level/Annum ______________________
Institutional Arrangement ____ (Existing Whole Cooperative Business) ____________
• Cost of Fund NRs. __________________________________________________
• Operating Cost NRs. ________________________________________________
• Staff Turnover/Year _________________________________________________
• Rate of Interest/Year (Lending) ________________________________________
• Monitoring Policy (System) ___________________________________________
• Transparency (Policy and System) _____________________________________
• Cooperation among Members _________________________________________
• Shared Value ______________________________________________________
• Members Education (Level)________ illiterate ______ literate SLC________ IA _______
BA ___________ Above ______________
• Others __________________________

43. Annex # 2
Business Plan for Success Business
Replication
A. Introduction
1. . Femal Male
Name e
:
2. 3. Total
Address members:
:
4. Active 5. Share
members: capital Rs:
6. Registration 7. Male
Number, Date, Place: Chairperson:
M/F
Femal Male

44. e
8. Executive Committee Members: Total :
B. Vision and Mission
1. What are the objectives of forming the cooperative?
1. Organize farmers involved in vegetable and fruit
1 farming
1. Establish direct contact between the farmers and
2 consumers
1. To transform traditional and subsistence-oriented
3 farmers into commercial farmers
1. To institutionalize agro-based trade
4
1. Promote production of vegetables and fruits up to
5 international markets while considering
competition in the market
C. Business chosen for replication: Please check.

45. D. What kinds of business activities to undertake in the business on an SCR
basis?
Type of Project Quanti Amou Profi Remar
ty nt Rs t ks
1.
2.
3.
4.
5.
E. What are the advantages of the project (overall development of farmers,
better quality products, etc.)

46. F. Is it based an your skills and experience or market demand; is there any
other special reason for selecting this product?
G. Supply of Raw Materials
Provide details in the table below:
S. Type of Required Quantity Total
N. Material Quantity
Are the above raw materials available at your cooperative site and from whom?
The cooperative provides these to the members.

47. H. Production:
What is the production/manufacturing cycle for each product (from procurement of
raw materials to sale in the market)?
S. Production Cycle Time Quanti Remar
N. Required ty ks
I.Division of Responsibilities
Do you need to employ additional people to run this business?
S.N Personal Number Cost (NRs) Responsibili
. Skill ties

48. J. and Equipment Required
What kinds of tools and equipment do you need?
S. Tools and Pric Numbe Total Useful Life
Equipment e Rs r of Tools &
N. cost
Equipment
Rs
1. Tractor use 6
hours per bigha
2. Pump-set use 3-4
times
3. Pesticide sprayer
3-4 times
4. Hand tools (kuto,
kodalo)

49. 5. Purchase of
sprayer
K. Marketing
1. Product
1.1 Who will be your customers?
(a) Business persons from local area and outside
1.2 Why are they interested to buy your product?
(a) To meet daily needs
1.3 What type of quality standards do you intend to follow?
(a) Packaging and grading varies by product
1.4 What types of packaging will you use?
(a) Will use baskets (doko), bags, plastic crate as

50. needed
1.5 Where will you locate retail unit and why?
(a) Will sell to local consumers in the local market
1.6 What expense do you expect to incur on retail?
(a) Will increase by 5%
2. Price
2.1 What would be the retail and wholesale price/unit?
(a) Wholesale price Rs 10, retail price Rs 15
2.2 Will consumers be willing to pay the price?
(a) Yes, since there is demand in the market.
2.3 Do you sell on credit?
(a) Yes, based on trust

51. 2.4 Were the cooperative members consulted about the price?
3. Promotion
3.1 How would you promote/distribute the product?
3.2 Who are you competitors? Where are they located?
(a) Traders in Kathmandu, Pokhara, Narayanghat
and Hetauda.
3.3 What is their size and market potential?
(a) They are like us.
3.4 What are the strengths and weaknesses of your competitors?
(a) Their weakness is producing the same kinds of
vegetables.
3.5 Don't have quantity. Don't have proper sheds/places But they provide credit.

52. L. Financial Aspects
a. Investment needs
What will be your financial needs.
b. Fixed Investment Rs
Equipment/machiner
y
Land/building
Total
c. Working Capital Rs
Raw Materials
Production/manufacturin
g cost
Administration cost

53. Land and Building
Total Investment NRs.
D. Source of fund
Source Amount Rs.
Loan
Members' share
capital
Group investment
Accumulated group
saving
Grant
Any other
Total NRs.:
e. Sales
What is your forecast of total sales?

54. S.N Production/ Total Unit Total
. Amount Pric Sales
Quantity/Sales per
Rs e Amount
Member
Rs
f. Financial Statement:
Not Possible at this moment.
Profit/Loss Account :
S.N Cost Particulars Amount Earning Amount Rs
. Rs. Particulars
1. Opening stock
2. Purchase
3. Electricity

55. S.N Cost Particulars Amount Earning Amount Rs
. Rs. Particulars
4. Salary/wages
5. Repair &
maintenance
6. Telephone,
postage
7. Printing/statione
ry
8. Local transport
9. Office expenses
10. Advertisement
11. Staff welfare
12. Consulting
charges
13. Books,
newspaper
14. Insurance
15. Depreciation
16. Rent

56. S.N Cost Particulars Amount Earning Amount Rs
. Rs. Particulars
Total
g. Profitability
 Sales (monthly/yearly)
 Total cost NRs.
 Gross Profit NRs.
SCR Training Required at SCR Site:
1. Training for Cooperative Board Members
2. Cooperative Management Training
3. Marketing Training
4. Accounting Training
5. Production Training
6. Quality Control Training

57. h. Cash Flow
Not possible now.
S. Particulars Amount In NRs. Remark
s
N. 1 2 3 4 5 6 7 8 9 10 11 12
1. Cash inflow
Opening balance
Sales receipts
Any other income
Total (A)
2. Cash outflow
Rent
Electricity
Postage &
Telephone
Transportation

58. Repayment of
loan
Insurance
Any other
expanses
Total (B)
3. Net cash flow
(A+B)
Closing balance
Q. How do the participants/cooperative think that women members will be included in
the SCR process?
Q. Role of Women in SCR
Thank You.