This opinion was expressed by Anton Preobrazhensky, co-owner of the Kyiv-based city-farm network Growa, which grows microgreens for sale, in a comment to Delo.ua.
An option of creating a vertical farm for growing ready-to-eat plant sprouts, which, according to the state classification, corresponds to a modular greenhouse with an area of 1.6-2.4 hectares was considered.
Anton Preobrazhensky explains that he calculated the feasibility of this state support program and declined it because his business cannot afford to employ a minimum of 25 workers, as required by the grant rules. For comparison, Growa currently employs 4 people, and the planned vertical farm can easily be serviced by two individuals.
He explained that even if the staff were paid the minimum wage (10,000 UAH including all taxes), this would result in a monthly burden of 250,000 UAH on the business. Assuming that the greenhouse must operate for at least 36 months, this wage burden will amount to approximately 8 million UAH over three years, which is comparable to the grant amount.
“A monetary grant allows us to accelerate business development – in a year, we will receive 7 million UAH, but this is a significant additional financial commitment for us for the next 3 years. During this time, we will be paying much more. Therefore, in a ten-year perspective, we will have the same development result – whether with a grant or without it. Moreover, there is currently a war, there is a risk of damage or destruction of the farm, and I cannot guarantee that the business will operate stably for 3 years. Therefore, in our case, we have more risks than benefits,” the entrepreneur explains.
Anton Preobrazhensky specifies that changes to the procedure for obtaining grants may interest entrepreneurs in using state grants. In particular, the main goal of the grant should be to create favorable conditions for the development of food producers, rather than employing unemployed people. In addition, it is necessary to exempt the entrepreneur from paying taxes for additionally hired workers during the first three years of business operation. At the same time, there should be simplification of the requirements for the number of personnel.
“There are businesses where grant aid is relevant, and such a number of people is needed for the business to operate. But this does not suit greenhouse owners. We can confidently say that we have 5 times less need for human resources than the state requirements for grant provision,” concludes Anton Preobrazhensky.
Source: Delo.ua