EXECUTIVE SUMMARY
This pre-feasibility is about setting up a dairy farm in which cows and buffaloes are kept primarily for milk production in conventional housing system. The animals are fed green fodder and roughage at 8-10% of live body weight in addition to nutritionally balanced formulated feed and bred by Artificial Insemination method to gain optimum milk yields in lactation cycle of average 300 days. Dairy farming involves housing, breeding, feeding, watering, disease control and hygienic production of milk on farm.  A dairy farm with 12 animals (80% cows and 20% buffaloes) needs a total investment estimated at Rs. 2.19 million out of which the capital cost of the project is Rs.2.01 million with working capital of Rs. 0.17 million.
BRIEF DESCRIPTION OF PROJECT & PRODUCT
The proposed dairy farm would be established on leased land with purpose built shed constructed on conventional housing system.  The farm would start the operations with 12 animals (10 cows and 2 buffaloes having daily per animal milk production of 13 and 8 litres respectively) to achieve milk production of 34,560 liters by the end of first year, excluding the milk consumed by suckling calves. The breeding of animals would be planned through ‘Artificial Insemination’ method. Female calves would be given special attention and raised as heifers and male calves would be sold for fattening purpose. The milk will be primarily sold to bulk buyers at the rate of average Rs.60 per liter. The farm will also offer milk sale to domestic individual consumers.
CRITICAL FACTORS
Background knowledge and related experience of the entrepreneur in dairy farm operations.  
Application of good husbandry practices such as timely feeding, watering and vaccination to ensure animal’s health and disease-free environment.
Awareness about the supply and demand of milk in the market as demand of milk is relatively higher in summer as compared to winter season. 
Efficient marketing of the project and bulk supply to wholesalers.
INSTALLED & OPERATIONAL CAPACITY
In the proposed study, initially twelve (12) animals, preferably 80% cows and 20% buffaloes, are recommended to obtain optimum milk production in the first year of project. It is assumed that on average, 70-80% animals would be in lactation on farm. The female heifers born at farm would be added in milking herd; hence the number of animals would be 50 at 10th year of project. The male calves would be sold for meat. Although, buffaloe milk has higher fat content (9-10%) as compared to cow’s milk (3- 6%) but total milk production of cows in average lactation period of 300 days is higher as compared to buffaloes. The dairy farm will have the capacity to sale 34,560 liters of milk, primarily directly to consumers and then milk contractors and processors in its first year of operation. 
GEOGRAPHICAL POTENTIAL FOR INVESTMENT
Dairy farming is a viable business proposition for both rural and peri-urban areas of Pakistan. There is almost equal demand for milk in rural and peri urban areas around the major cities such as Lahore, Faisalabad, Jhang, Sahiwal, Pakpattan, Jehlum, Peshawar, Charsadda, D.I. Khan, Quetta, Zhob, Lasbela, Karachi, Hyderabad, Sakkar etc. across the country; hence, from the demand point of view, the said project offers good investment opportunities for small scale investment in all provinces of country.
POTENTIAL TARGET MARKETS
Apart from Lahore, Sialkot, kasur, Gujranwala, Bahawalpur, Okara, Dadu, Lasbela, D. I. Khan etc., dairy farming in rural and peri-urban locations around all major cities are the primary markets for dairy farming. The target clients for a dairy farm business include; domestic consumers, milk contractors and suppliers, milk collection and processing companies and dairyproducts manufacturing companies.