Professional Documents
Culture Documents
Project Proposal For The Construction of
Project Proposal For The Construction of
A. Source of Revenue
As public policy of any nation, the government collects different forms of
taxes from different business organizations and individuals. Among the
different forms of taxes, business income taxes, payroll income tax and
VAT are collected from undertaking business activities. Therefore, the
building will serve as sources of revenue for the town as well as for the
region.
B. Employment opportunity
One of the problems that our country faced is unemployment. Therefore,
the current objective of the government is working on tackling the
problem of unemployment and fostering the development process either
through creating self employment or employment in other organization.
Hence, this project will hire 26 individuals and more than eighty
individual during construction.
2.7. competition
there are different forms of competition that may face the envisaged
mixed use building. These are price and non price based competition.
Moreover, there are different competitors that will compete with the
project either directly or indirectly. But the mixed use building under
discussion has diversified marketing strategies that could enable it cope
up with the different competitors in the market. Moreover it will
frequently conduct competitors research which focuses on, the strength
and the weaknesses, the different competitors’ strategies, the techniques
they use in rendering the service, their customer handling methods, and
others. Generally the project has many other projects all over Ethiopia
which compete with it.
2.8. the project facilities and Services plan
In order to provide mixed use business center building services of a high
standard, it has been planned to construct and develop the
infrastructure and facilities that would viable to meet the requirements of
an international standard business center. Accordingly, various
buildings and facilities will be constructed phase by phase starting with
the most needed ones that are essential to commence the operation of its
business activities. With the completion of construction, the building will
provide a combined service such as shops, bedroom, restaurant and café
service as well as modern business center that primarily serve its guests
and major clients.
3.4. Utilities
A number of utilities world be put in place in order to ensure smooth
functioning of the project. These utilities include:
Water Supply,
Supplementary Electricity supply.
Telephone line Internet Broadband
Fuel, Oil and lubricant
Drainage Facility
General
Manager
HRM and
finance IT, Electricity
and plumper
Cashie Purch
r aser
C. Vehicle
SN Description UOM Qty Unit Cost Total cost in Remark
in Fr. Birr
1 Mini-Bus Unit 1 300,000.00 300,000.00 Duty Free
Total 300,000.00
D. Office Equipments
SN Description Measurement Qty Unit cost Total cost
in birr in Birr
1 Managerial tables Unit 5.00 2,600.00 13,000.00
2 Managerial chairs Unit 5.00 1,950.00 9,750.00
3 Office table with chair Unit 7.00 1,350.00 9,450.00
4 Secretarial table with chairs Unit 1.00 1,450.00 1,450.00
5 Computer with chairs Unit 3.00 15,000.00 45,000.00
6 Shelf Unit 3,500.00 3,500.00
7 Filing cabinets Unit 1.00 1,500.00 1,500.00
8 Guest chairs Unit 1.00 900.00 4,500.00
9 Fax & Telephone machine Unit 5.00 1,300.00 1,300.00
10 Carpet and Curtain LS 1.00 23,000.00
Total 112,450.00
5.2 Working Capital
5.2.1 Operating Expense at full Capacity2
a. salary Expense
SN Position No Qualification Monthly Annual
salary in salary in
Birr Birr
1 General manager 1 BA in management 300 36,000
2 Building admin 1 BA in Acct/Mgt 2500 30,000
3 Secretary 1 10+2 in secretariat science 900 10,800
4 HRM Officer 1 10+2 in HRM/Management 950 11,400
5 Technical and 1 Diploma in building 1500 18,000
maintenance manager maintenance
6 Finance head 1 BA in Accounting 2500 30,000
7 IT Technician 1 Diploma in computer 1150 13,800
science/IT
8 Marketer 1 Diploma in marketing 1150 13,800
9 Accountant 1 Diploma in accounting 1150 13,800
10 Guards/Security 4 Basic 500 24,000
11 General Service head 1 Diploma in Management 1500 18,000
12 Purchaser 1 Diploma in purchasing 1150 13,800
&Sup Mgt
13 Electrician 1 10+2 in general electricity 1000 12,000
14 Plumber 1 10+2 in general mechanic 1000 12,000
15 Casher 2 10+1 in bookkeeping 850 20,400
16 Cleaner 5 Unskilled 450 27,000
17 Maintenance officer 1 10+2 in General mechanic 1000 12,000
18 Driver 1 10 completed 850 10,200
Total 26 327,000
Benefit (20%) 65,400
Grand Total 392,400
5.2.2 Operating Expenses
SN List of Items Annual cost in birr Assumptions Used
1 Audit and legal fee 24,000.00 2000 br/per ,month
2 Stationery supplies 6,000.00 500 br/month
3 Promotional Cost 40,000.00 Lump sum annual cost
4 Property Insurance 84,009.00 1% of the building
5 Cleaning Supplies 10,800.00 900 br. Per month
6 Uniforms 1,670.00 180 per pes for 16 people
7 Water consumption 5,000.00 2500 m3 by 3.15 br
8 Electric consumption 6,000.00 20000KWH By Br.0.4736
9 Fuel 42,672.00 2032 lit per year by Br. 21
10 Oil & Iubricants 4,267.20 10% of fuel cost
11 Telephone & fax 18,000.00 1500 per month
12 Repair expense 72,018.00 2% of building cost
13 Miscellaneous costs 20,000.00 3000 per month
Total 334,436.20
B. depreciation
Building 10%
Building machincry and equipment 10%
Office Equipments 10%
Expenses
Salary Expense 235,440.00 313,920.00 392,400.00
Operating Expenses 200,661.06 267,548.08 334,436.20
Deprecation Building 323,242.95 323,242.95 323,242.95
Deprecation Bld. 22,780.00 22,780.00 22,780.00
Machineries and Equip.
Deprecation of Vehicle 60,000.00 60,000.00 60,000.00
Deprecation office Equip 11,245.00 11,245.00 11,245.00
Interest Expense3 354,548.95 319,094.055 177,274.475
Lease payment4 4,819.05 4,819.5 4,819.05
Total Expense 1,230,939.05 1,339,031.25 133,5298.65
Profit before Tax 554,061.00 1,040,968.75 1,639,701.35
Tax (30%) 166,218.03 312,290.625 491,910.405
Net profit 387,842.07 728,678.125 1,147,790.945
5.4.2 Cash flow Statement
Year Year 0 Year 1 Year 2 Year 3 and
after
Equity Capital 1,519,495.5
Loan principal 3,545,489.5
Net sale 1,785,000 2,380,000 2,975,000
Total Cash in flow 5,064,985 1785000 2380000 2,975,000
Cash payment
Salary Expense 0 235,440 313920 392,400
Investment 3,872,679.50 0 0 0
Pre operating Expense 5,000 0 0 0
Operating Cost 0 200,661.6 267,548.8 334,436.20
Loan repayment3 0 709,097.9 673,643 531,823
Lease payment 0 4,819.5 4,819.5 4,819.5
Tax payment 0 166,218.0 312,290.625 491,910.405
Total payment 3,877,679.5 1316237.3 1,572,221.925 1,755,389.105
Cash surplus/ deficit 1,187,305.5 468762.7 807778.075 1219611
Cumulative cash flow -332190 136572.7 944350.775 3919350.775