Business / Economy

Food for thought for China's young entrepreneurs

By Gordon Watts (China Daily) Updated: 2015-05-06 07:46

They have been called the "1990s Generation". Young, gifted and entrepreneurial, they are the group of talented 20-somethings destined to set up the corporations of the future.

At first glance, technology seems to play a major role in their new ventures. Gaming, Internet services, applications and virtual shopping appear to dominate the landscape when it comes to setting up new businesses.

Yet when you look beyond the cyber world, the real one can be just as fascinating for this new breed of budding tycoons, and probably just as rewarding.

Peng Yu, 23, and girlfriend Dai Ying, 22, certainly think so after discussing their business plan with the China Daily in a "Tomorrow's Entrepreneurs" special on April 27.

The college graduates have turned their backs on the new range of information technology startups to open a 3.3-hectare organic chicken farm in a rural area of Sichuan province with the help of a 500,000 yuan ($80,645) investment from their parents.

To many, this might appear a very traditional business, and one that their families would have set up 20 years ago. But if Peng and Dai get it right, they could end up feathering their own nest with a highly profitable operation.

The early signs are encouraging. With a catchy company name-Amour, or Love, Ecological Farm-the fledgling venture has already made a 500,000 yuan profit since last November. By the end of this year, they hope to increase their poultry stock from 3,000 to 10,000 birds, with sales of 2 million yuan.

Although still tiny compared to more established companies, they are operating in a massive industry. Globally, the food sector was worth $4 trillion in 2012, according to the United States Department of Agriculture Economic Research Service.

When you break down that figure, it gets even more interesting.

One thriving market involves organic food. For example, the sector is expected to grow from $57.5 billion in 2010 to $104.7 billion in 2015, a report by Transparency Market Research, entitled the Organic Food Market-Global Industry Size, Share, Trends, Analysis and Forecasts 2012-2018, highlighted.

For Peng and Dai, this could open up a distinctly upmarket business in China. Producing a successful organic brand would be a massive money-spinner in one of the oldest markets of all.

If they are still unsure where to aim their produce, they might like to digest this. "Demand for organic food products is expected to grow with time," Transparency Market Research underlined in its report.

"Government funding and involvement of private companies in the market is also expected to fuel the growth of this sector.

"Organic food is produced by farmers who focus on using reusable resources. Food is grown on small, family-run farms, in order to conserve the soil and water, and ensure environmental quality for future generations."

This is exactly the sort of business that China is looking for in the 21st Century-sustainable and environmentally friendly. It is true, Peng and Dai could have moved into another industry to make their fortunes and help expand the economy.

But by going into poultry farming, their chickens have literally come home to roost.

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