UNIVERSITY OF LIMPOPO

FACULTY OF MANAGEMENT AND LAW

SCHOOL OF ECONOMICS AND MANAGEMENT

GROUP NO: B

NAMES: ……………………………………STUDENT NO:

MUOFHE MC 201301240

KWAPA J 201301551

KOPA C 201301562

SEROKA NA 201301594

MOTHAPO MM 201301639

LEWELE MP 201302116

MUSHAYA NP 201302248

MODEL:ENTREPRENUESHIP (CBMB021)

Assessment: ASSIGNMENT NO 2

ACADEMIC Year: 2015

BUSINESS PLAN

0
OWNERS:

HOPE LIFE FUNERAL SERVICE.

BURGERSFORT, MPUMALANGA, SOUTH AFRICA
P.O.BOX 601
BURGERSFORT
1150
TELEPHONE: 015 9162107
FAX: 016 6002636
FACEBOOK: HOPE LIFE FUNERAL SERVICES
TWITTER: HOPE@LIFE FUNERAL SERVICES
E-MAIL: HOPELFS@GMAIL.COM
WEB: WWW.HOPELIFE.WIX.CO.ZA

HOPE LIFE FUNERAL SERVICES BUSINESS PLAN

TABLE OF CONTANT

DETAILS…………………………………………………………………………PAGES

1
EXECUTIVE SUMMARY ………………………………………………………………3

BUSINESS BACKGROUND SUMMARY……………………………………………6

PRODUCTION AND SERVICES SUMMARY………………………………………7

STRATEGIC AND MARKET ANALYSIS……….……………………………………8

OPERATIONS STRATEGIES (PLAN)……………………………………………….11

MANAGEMENT STRATEGIES (PLAN)…………………………………………….11

FINANCIAL STRATEGIES (PLAN)…………………………………………………12

1 Executive Summary

Ceremonial practices around death, as practiced by R.S.A funeral homes, are leaving a
growing segment of the population feeling poorly served. This plan outlines the strategy by
which the Hope Life Funeral Services will define and dominate a new category of funeral

2
provider in South Africa based at Mpumalanga and Limpopo. It also details how the
financing it acquires will be used toward this end.

The purpose of this business plan is to raise R750000, 00 for the development of a funeral
home while showcasing the expected financials and operations over the next three years.
Hope Life Funeral Services is located in Burgersfort in the valley of the Spekboom River at
the edge of the Bushveld complex in the Greater Tubutse municipality, near the border from
Mpumalanga to Limpopo, based corporation that will provide casket/cremation receptacle
sales, funeral services, cremation services, community support(CSI) and pre-funeral care
services customers in its targeted market. The Hope Life has formed as a funeral cover to
solve funeral problem in all homes in Burgersfort and other South African areas. It solely
owned by Ramaite Seroka, Mothapo Mary, Muofhe Mulalo, Lewele Mapule, Mushaya
Ndamulelo Phillip, Kwapa Joas and Kopa Clearance.

Establishment of the Hope Life Funeral Services will provide Burgersfort and the
surrounding area with a way for people to celebrate the life of the individual when it ends and
for the living to gather social support to bring closure and move ahead with their lives.  Its
cornerstone will be the use of a reception area for social gatherings after the funeral that will
foster human connection and uplifting remembrance. This is the way the aging segment of
Baby Boomers is showing it prefers. This facility will also be the basis of its strategy of
community involvement to rapidly develop the reputation the Hope Life needs to attract
business in a way that benefits the charities it supports as well. Digitized photos will be used
for the reception as well as on our website to extend the celebration of the individual's life
beyond the funeral.

With the establishment of the Hope Life Funeral Services, those who lose someone to
death will for the first time in our era be integrated into the community of life instead of
stigmatized and marginalized. Is the new Life Funeral Services for community involvement.
And for the first time, the Boomer generation will be able to go out the way it lived.

1.1 Objectives

The Hope Life Funeral Services provides celebration of an individual's life and social support
to bring closure and move ahead with living. The institution develops by 4 years, a reputation

3
as the uplifting place for locally prominent persons of the Baby Boom generation to celebrate
their lives when they end.

In order to achieve this, Hope Life Funeral Services will create facilities that bring families
and communities together in a way that celebrates the life of the deceased and renews bonds
of social support. Digitized photos and films of the deceased will be available in the reception
room and on our website.

Ramaite Seroka, Mothapo Mary, Muofhe Mulalo, Lewele Mapule, Mushaya Phillip, Kwapa
Joas, Kopa Clearance, will make themselves available for a leadership position starting a
local chapter of a non-profit that helps children with life-threatening diseases, such as the
Make-A-Wish Foundation.Hope Life provides a funeral planning guide for estate attorneys to
give to their clients.These efforts are supported by a publicity campaign in order to be the
first in people's minds with this new category of funeral provider. Hope Life Funeral
Services "People remembering people."

1.2 Mission

The mission of the Hope Life Funeral Services   is to bring people together to celebrate life
when it ends and to move on with living. The Hope Life has facilities that bring families and
communities together to remember the life of the deceased and renew bonds of social
support. The Hope Life's facilities will be a focus of non-profit energies to make the
community a better place to live.

1.3 Keys to Success

Since 85.5%per cent of people choose a funeral home on the basis of reputation, the key to
success is quickly establishing a reputation for this new category as the uplifting place for
Burgersfort to celebrate life when they die.

The Hope Life's cornerstone is in its reception facilities, which will promote uplifting

interactions with people after the funeral and be used for non-profit organizations. This will
make the Hope Life uplifting, connect it to the community, provide the basis for publicity,
and make it a place for the living.

4
The reception room and website are feature digital photos and films of the persons whose
lives are being celebrated. This web presence is increase the Hope Life's exposures by letting
people participate in the celebration of life after the funeral and reception are over.

Providing the greatest choice of quality caskets makes the Hope Life the place to celebrate
the lives of locally prominent persons. This foster publicity and further promote our
reputation.

1.4 Products and Services

Hope Life Funeral Services isspecializing in providing a plethora of services related to

memorial services and funerals for people that have passed away. These services include
embalming of the deceased’s body, body preparation for open casket funerals, transportation
of the body to the grave site, cremation services (which will be outsourced), and preparation
of the actual memorial service or wake. The business isgenerating high margin income
streams from these services. However, the bulk of the business’s revenues will come from the
sale of caskets and cremation receptacles. Management expects to earn gross margins of 70%
on each casket/receptacle sold by the business. The third section of the business plan will
further describe the services offered by the Hope Life Funeral Services.

1.5 The Financing

Management is seeking to raise R750000, 00 from as a bank loan. The interest rate and loan
agreement are to be further discussed during negotiation. This business plan assumes that the
business will receive a 15 year loan with an 8% fixed interest rate.

1.6 Management Team

The partnership was founded by Ramaite Seroka, Mothapo Mary, Muofhe Mulalo, Lewele
Mapule, Mushaya Phillip, Kwapa Joas, and Kopa Clearance. Management team has more
than 5 years of experience in the funeral industry. Through their expertise and licensure as a
funeral director, they were able to bring the operations of the business to profitability within
its first year of operations.

5
1.7 Sales Forecasts

The management team expects a strong rate of growth at the start of operations. Below are
the expected financials over the next three years.

1.8 Expansion Plan

The managers expect that the business will aggressively expand during the first three years of
operation. Management intends to implement marketing campaigns that will effectively
target individuals within the target market. Management will also develop a number of on-
going referral relationships with hospitals, nursing homes, hospices, and other people that can
refer business to the business after a relative has passed away.

2 Business background Summary

2.1 Registered Name and Corporate Structure

Hope Life Funeral Services. The business is registered as a partnership business in the
Republic of South Africa.

2.2 Required Funds

At this time, the Hope Life Funeral Services requires R750000, 00 of debt funds.

2.3 Investor Equity

Hope Life Funeral Services is not seeking an investment from another party at this time.

2.4 Management Equity

They own Ramaite Seroka 14,3%, Mothapo Mary14,3%, Muofhe Mulalo14,3%, Lewele
Mapule 14,3%, Mushaya Phillip 14,3%, Kwapa Joas 14,3%, Kopa Clearance14,3% of the
Hope Life Funeral Services.

2.5 Exit Strategy

If the business is very successful, management may seek to add another partner in the
business for a significant earnings multiple or sell the business. Most likely, the business will

6
hire a qualified business broker to sell the business on behalf of the Hope Life. Based on
historical numbers, the business could fetch a sales premium of up to 4 times earnings.

3 Products and Services

Below is a description of the funeral and after death care services offered by the Hope Life
Funeral Services.

3.1 Funeral and Mortician Services

As stated in the executive summary, the Hope Life operate in a full service capacity by
offering a number of mortician services as well as a venue to hold wakes and memorial
services. The Hope Life’s directors will possess all of the necessary training and licensure in
Mpumalanga to provide services to families that have lost a relative.

3.2 Sales of Caskets, tombstones and Cremation Receptacles

The Hope Lifemaintains an extensive inventory of caskets, urns, and cremation receptacles
that are used in conjunction with the aforementioned services. As discussed earlier, the bulk
of the business’s revenues are also come from the sale of these products to customers.
Currently, management is sourcing a number of product manufacturers and wholesalers that
will provide the Hope Life with products at wholesale and direct manufacturer prices. It also
sells tombstones.

3.3 Catering and decorating

Hope Life offers catering for the family and the community as a whole. The decoration
service includes decorating the tent that includes chairs, tables and music system. On the
burial day. Hope Life Funeral Services also sells tombstones that can be erected on the same
day of burial depending on the type at funeral plan and decision of a customer.

4 Strategic and Market Analysis

7
4.1 Economic Outlook

This section of the analysis will detail the economic climate, the funeral and death care
industry, the customer profile, and the competition that the business will face as it progresses
through its business operations. Currently, the economic market condition in South Africa is
in recession. This slowdown in the economy has also greatly impacted real estate sales, which
has halted to historical lows. However, Hope Life operates with great economic stability
simply due to the fact that people will continue to pass away and require funeral services
despite the current economic climate. Although during economic recessions, people may
spend less on funerals (especially on caskets), any decline in top line revenue should be
slight, and would not impact the overall profitability of the business.

4.2 Competitive Analysis

We have two competitors.

Numbers one is Two Maintains is located at shop 8 and a Marone street at Burgersfort 1150
next to the residential area at extension 5 behind Cash Build opposite Supa Quick. Services
provided by Two Mountains: funeral plans, burial services, transportations, funeral tens,
tables and chairs and funeral programs. It also sells coffins. Two Mountains is located in the
place which is not visible and is a place where people cannot easily access.

Our second compactor is Tswelopele Funeral Services is located next to Excel garage which
is next to a local taxi rank little outside of Burgersfort mall . Services provided: funeral plans,
burial services, transportations, funeral tens, tables and chairs, funeral programs, catering and
decoration. Also sell coffins. Tswelopelo funeral services also offer short term loans. Is
accessible to people who come from Burgersfort mall.

Hope Life Funeral Services is located in Burgersfort in the valley of the Spekboom River at
the edge of the Bushveld complex in the Greater Tubutse municipality, near the border from
Mpumalanga to Limpopo. Services provided by Hope Life: itoperates in a full service
capacity by offering a number of mortician services as well as a venue to hold wakes and
memorial services. The Hope Life’s directors will possess all of the necessary training and
licensure in Mpumalanga to provide services to families that have lost a relative. Hope Life
maintains an extensive inventory of caskets, urns, and cremation receptacles that are used in

8
conjunction with the aforementioned services. As discussed earlier, the bulk of the business’s
revenues are also come from the sale of these products to customers. Currently, management
is sourcing a number of product manufacturers and wholesalers that will provide the Hope
Life with products at wholesale and direct manufacturer prices. Decoration and catering
services, family catering, sell tombstones and coffins to other funeral homes.

4.3 Marketing Strategies

Management team intends on using a number of marketing strategies that will allow the Hope
Life Funeral Services to easily target people who have recently lost a friend/relative within
the target market. These strategies include traditional print advertisements and ads placed on
search engines on the Internet. Below is a description of how the business intends to market
its services to the general public. The Hope Life Funeral Services will also use an internet
based strategy. This is very important as many people seeking local services, such as funeral
homes, now the Internet to conduct their preliminary searches. Management register the Hope
Life Funeral Services with online portals so that potential customers can easily reach the
business. It also develops its own online website, which will showcase the location, services,
contact information, and preliminary pricing information for the business’s undertaking
services. Finally, Ramaite Seroka, Mothapo Mary, Muofhe Mulalo, Lewele Mapule,
Mushaya Ndamulelo Phillip, Kwapa Joas and Kopa Clearance and theHope Life Funeral
Services will establish on-going referral relationships with hospices, hospitals, nursing
homes, and assisted living facilities that will provide on-going referrals to families of people
who have recently passed on. This is an extremely important aspect to the Hope Life’s
marketing operations.

4.4 Pricing.

9
Coffins our price range from R5000 to R20 000 depending on the funeral plan.

Caskets: our price range from R15 000 to R55 000 depending on the funeral plan.

10
Urns our prices range from R7200 to R 30 00 depending on the funeral plan of the consumer.

Tombstones: our price range from R2000 to R100 000 depending on the size and funeral plan
of the consumer

Funeral plan which offered by hope life funeral services: plan a, funeral cover up to
R50 000. Cover for her/himself, her/his immediate family and parents. Access the cover
without medical examinations. Cover for her/his family and no need to pay further premiums
after her/his death. Immediate cover for accidental death. Quick pay-out on receipt of all the
required claim documents. Plan b, maximum starting cover of R50 000 or R70 000 depending
on choice of plan.Funeral cover from R27/monthmaximum pay-out:R100 000settle funeral
expenses or debt. Cover for partners, children, extended familyfuneral cover and support for
your burial society. Cover for family and adult dependents. Pay-out within 48 hours. Receive
R5 000 cover for 14 months. No monthly premiums. Use a cellphone to register

5 Operations Strategies (Plan)

11
With one full time and one part time licensed Hope Life Funeral Services is able to respond
to funeral needs at any time. A part time office administrator ensures that records and
administration is completed in a timely and efficient manner. During actual services two
funeral assistants and four general helpers are available. And all volunteers.Presently one of
these individuals is about to begin the Hope Life Care Community College Funeral Services
Program. Banking and financing is done through the First National Bank (FNB) Credit
Union.
Funeral insurance is sold through 1Life Benefits Insurance(trademarked under“Family side”)
and operates by means of monthly mail outs to designated areas, the mail out contains our
name as well as the agents name. When someone uses this service, the funeral is assigned to
Hope Life Funeral Services and the insurer becomes a member.Caskets/urns/supplies are
purchased from a number of Maritime suppliers on an as needed to replenish inventory. Hope
Life Funeral Services owns the following buildings and equipment and uses it in the day to
dayoperations:
 funeral home and maintenance building
 furnishings
 computer
 van/hearse
 embalming room equipment
 tents, tables and chairs
 decoration tools and flowers

6 Management Strategies (Plan)

Day-to-day operations are run by the full time licensed Hope Life Funeral Services directors
and the part time office administrator. The office administrator is also responsible for
bookkeeping. The three member Executive Committee holds conference calls as required
(usually weekly) to approve new members and financial matters up to R3000000. The
Executive also plans membership meetings and deals with the larger operations issues of
Hope Life Funeral Services.The seven (7) member Board of Directors meets monthly to
determine policy and direction of the co-operative. Any financial matters of more than
R1000000 also need to come before the Board. The position of management team of Hope
Life Funeral Services general manager (chairperson of board) Ramaite Seroka, the accountant
is Mushaya Ndamulelo Phillip Chartered Accountant, Auditor Muthapo Mary, these two

12
conducts a review engagement report annually to ensure Hope Life Funeral Services is
following South African generally accepted accounting standards. Assets controller Kopa
clearance. Service operator Muofhe Mulalo. Market manager of Kwapa Joas and
Organisational Administrator Lewele Petience.

7 Financial strategies (plan).

7.1 Profit and Loss Statement

HOPE LIFE FUNERAL SERVICES

Projected statement of profit or loss for the year ended 31 December
2015 2016 2017

Revenue R655290 R714266 R778550

Sales R131058 R142853 R155710
Services rendered R524232 R571413 R622840

Cost of sales (R65529 (R71427) (R77855

) )
Gross profit R589761 R642839 R700695

Add other operating income R30800 R38000 R40000

Interest expanses R28560 R38000 R38580
Profit on asset disposal R2240 R1420
Gross income R620561 R680839 R740695

Less operating expanses (R34516 (R355291) (R37478

1) 3)
Payroll(salaries) (R24300 (R250290 (R27371
0) ) 2)
General and administrative costs . (R14400 (R14976) (R15575
) )
Market expanses (R13761 (R15000) (R16350
) )
Depreciation (R5893) (R5893) (R6125)
Rent expanses (R6000) (R6000) (R7000)
Travel and vehicle costs (R15000 (R16500) (R18150
Insurance costs ) (R7875) )
Professional fees and licenses (R7500) (R25760) (R8269)
Interest expanses (R25000 (R12197) (R16350
) )
(R13107 (R11202
) )
Stationery (R1500) (R800) (R2050)

Net profit for the year R275400 R325548 R365912

13
7.2Balance Sheet.
HOPE LIFE FUNERAL SERVICES
Statement of financial position as at 31 December
2015 2016 2017
ASSETS

NON-CURRENT ASSETS R225000 R472220 R890450

Property, plant and equipment R145000 R380420 R779890
. R25000 R28000 R40000
Investment assets R55000 R63800 R70560
Intangible assets

CURRENT ASSETS R196400 R210400 R280450

Trade receivables R30800 R30000 R28862
Cash and cash equivalent R70000 R100100 R180000
Inventory R68500 R58516 R50892
Petty cash R27100 R21784 R20696

TOTAL ASSETS R421400 R682620 R1170900

EQUTY & LIABILITIES

EQUTY R289640 R400589 R610895

Capital R189640 R200589 R310895
Current account R100000 R200000 R300000

NON-CURRENT LIABILITIES R20000 R102031 R260000

Long-term borrowings R20000 R102031 R260000

CURRENT LIABILITIES R111760 R180000 R300005

Sort-term borrowings R13OO5 R39000 R40990
Trade and other payables R98755 R59000 R99000
Income received in advance R82000 R160015

TOTAL EQUTY & LIABILITIES R421400 R682620 R1170900

14
BUSINESS PROGRESS IN THREE YEARS TIME BACK.

R300,000

R250,000

R200,000

LIABILITIES
R150,000 ASEETS
NET PROFIT

R100,000

R50,000

R0
2012 2013 2014 2015

15