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Business plan sample

Bachelor of Commerce (Jomo Kenyatta University of Agriculture and Technology)

Studocu is not sponsored or endorsed by any college or university

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UZURI
UZURI INSTITUTE

DEPARTMENT : COSMETOLOGY

FACULTY : DIPLOMA IN COMETOLORY

ADM NO : 094

NAME OF THE PRESENTER : ANN MUEMA

COURSE : BUSINESS PLAN

LECTURER : MR KINITY

SUGGESTED BUSINESS NAME : CYNDY CLASSIC BEAUTY SPA

DATE OF PRESENTATION :

SIGN :

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DECLARATION

I Ann hereby declare that this is my own work and has never been submitted to any award of
certification and examination purpose, it is written for the award of diploma in cosmetology

Presented by ……….ANN MUEMA

SIGNATURE…………………………..

DATE…………………………………

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DEDICATION

This business plan is dedicated to my family from where support and guidance came from since I
started my studies .They encouraged and motivated me to excel in my course.

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ACKNOWLEDGEMENT

I would like to express the deepest appreciation to MR Kinity for his encouragement and
guidance in the course of preparing my business plan .My very special tribute goes to my parents
for their financial support during my study time .In addition a thank you to the cosmetology head
of department madam Roseline Kamau for encouraging me to academically excel, for making
me who I am and continue making me match toward my dream .THANK YOU ALL.

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Table Of Contents
..................................................................................................................................................................... I
Declaration..................................................................................................................................................Ii
Dedication..................................................................................................................................................Iii
Acknowledgement......................................................................................................................................Iv
Table Of Contents........................................................................................................................................V
Chapter One.................................................................................................................................................1
1.0 Introduction.......................................................................................................................................1
1.1 Owner Background........................................................................................................................1
1.2 Entry And Growth Strategy...........................................................................................................1
1:3 Business Location..........................................................................................................................2
1.4 Forms Of Ownership.....................................................................................................................2
1.5 Type Of Business...........................................................................................................................3
1.6 Product And Services.....................................................................................................................3
Chapter Two................................................................................................................................................4
2:0 Introduction.......................................................................................................................................4
2.1market Plan Strategy.......................................................................................................................4
2:2 Customer Identification.................................................................................................................4
2:3 Competitor Analysis......................................................................................................................4
2:4 Market Share.................................................................................................................................5
2:5 Promoting And Adverting..............................................................................................................5
2:6 Pricing Strategy.............................................................................................................................6
2:7 Sales Tatics And Sales Target........................................................................................................6
2:8 Distruction Strategies....................................................................................................................7
2:9 Customer Service...........................................................................................................................7
Chapter Three..............................................................................................................................................8
3:0 Introduction.......................................................................................................................................8
3:1 Organization Structure...................................................................................................................8
3:2 Management Team.........................................................................................................................9

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3:3 Recruitment, Training And Promotion.........................................................................................11

3:4 Remunaration And Incentive.......................................................................................................11
3:5 Licences Permits And Other Requirments...................................................................................11
3:6 Support Services..........................................................................................................................11
Chapter Four..............................................................................................................................................12
4.0 Method Of Acquiring Tools And Equipments..............................................................................12
4.1 Capacity Utilization.....................................................................................................................12
4.2 Operation Strategy.......................................................................................................................12
4.3 Operation Strategy.......................................................................................................................13
4.3.1 Operation Strategy....................................................................................................................13
4.4 Regulations Affecting Operations................................................................................................14
4.5 Operational Timetable /Production Schedule...............................................................................14
Chapter Five..............................................................................................................................................15
Introduction...........................................................................................................................................15
5.0 Financial Plan..............................................................................................................................15
5.1 Proposed Capilization..................................................................................................................15
5.2 Pre Operational Cost....................................................................................................................15
5.3 Working Capital Potential Sales...................................................................................................15
5.4 Potential Risks.............................................................................................................................16
5.5. Profoma Income Statement.........................................................................................................17
5.6 Profoma Statements Financial.....................................................................................................18

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CHAPTER ONE

1.0 INTRODUCTION
Cyndy classic beauty spa is new upscale destination in Nairobi Moi Avenue offering a complete
beauty spa experience.

We offer massage in variety of styles, traditional Swedish massage, Indian head, hot stone
massage, and pregnancy among others .We also offer facial, makeup, manicure, waxing and
pedicure. The spa has the latest products and techniques but does not offer services on hair such
as cutting, styling and coloring. Our mission is to provide the highest level of customer service
therefore establishing a long lasting relationship of trust and commitment.

1.1 OWNER BACKGROUND

According to my likes and hobbies concerning beauty, I therefore went to school and gained
more skills. I also decided to come up with this spa’s they are expensively selling their products
on the other hand I knew people prefer cheap things than expensive ones so I lowered the prices

Initially I had the idea of opening Cyndy classic beauty spa and due to inadequate funds to
facilitate my own spa, was employed at Vera beauty spa and gained more interest and experience
and saved more for my current spa.

1.2 ENTRY AND GROWTH STRATEGY

Online marketing will be one strategy by joining sites and online groups by connecting with
people and presenting your opportunity then come up with decision even meeting with people
help you to share decision and experiences

Social media is another strategy,: Facebook, instagram and twitter by posting pictures of your
spa or a video of your new makeup techniques and tutorials and nail art will help get potential
customers who are into social media therefore more shares and likes will help us to create a free
marketing platform on the other hand our research has shown that a word of mouth is the best
advertising ,however we run specials throughout the week .also when a client leaves our business
with a new look he/she is broadcasting our name and quality to the public

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1:3 BUSINESS LOCATION

Cindy classic is located in Nairobi county River road next to Simba coach booking office. It is 15
km from Machakos country bus station .The reason for choosing this location is because their
many clients walking around the booking office and some heading to town, therefore some
people might be passing by or coming to the booking office and spot the spa and will be
interested and attracted to the spa without plans only to see what we offer and once interested
.They can pay of the particular service. There is also room of expansion as the business grows.

CYNDY CLASSIC BEAUTY SPA

P O BOX 1081-012
NAIROBI
TEL: 0798080130
EMAIL:CYNDY2016@GMAIL.COM
BUSINESS NAME

The legal name for my spa is Cyndy classic beauty spa. We choose this name because my
partners name is hard to pronounce so the reason for the name is because it is memorable by
even the old clients and therefore the classic name in it makes it more classic hence increasing
the number of clients by them visiting the spa regularly to have different services done to them.

1.4 FORMS OF OWNERSHIP

I had a client at renal beauty spa who finally became a close friend, one of her friend consulted
her on how to manage a beauty spa, and once she heard about me talking about starting my own
spa, she directed her to me via email and planned for a meet up, we met up and talked a lot
concerning the business and realized that we had the same intentions for the spa.

We partnered and opened Cyndy classic beauty spa and employed five workers , for both gender
one for facial and makeup ,one for manicure and pedicure ,another two for massage and the other
as the cashier and we became founders and managers of the spa. I chose partnership form of
business because two are better than one .The business is easy to establish and start because you
are sharing the profit and loss you will have a greater borrowing capacity and there is more
capital available for the business.

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1.5 TYPE OF BUSINESS

We decided to start the business from the ground up and the startup capital will be used to buy
for new products and furniture. Cyndy classic beauty spa will amount to approximately 32,500
and the spa equipment will cost 27,000.The owner will interest 5500 cash on hand at starting
hand.

1.6 PRODUCT AND SERVICES

At Cyndy classic beauty spa will offer a wide variety of services and products that include

Nails: Manicure, pedicure, nail polish and stickons

Skincare: facial (cleansing exfoliation, massage, masking)

Waxing=: tweezing, threading, depilatory, electrolysis

Massage: Indian head, full body, Swedish, deep tissue.

We also have Cinderella surgery .this is a rare treatment which will make my spa unique and
classy Cinderella surgery is the fixation for the correction of hanux raigus .this cosmetic
procedure reshapes feet so that women can easily slay and walk in high heels.

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CHAPTER TWO

2:0 INTRODUCTION

2.1MARKET PLAN STRATEGY

The business will offer products of high quality and also discount to all products, therefore a
good business requires people who need some products and services and are willing to purchase.
Cyndy classic beauty spa can deliver highly promising services in affordable prices to shape up
the look and styles. The business mainly aims all style conscious people in an age group. We also
maintain attractive friendly and nice work environment which respects customer opinions and
services.

2:2 CUSTOMER IDENTIFICATION

The main aim of the business is making profit and gaining more customers .the customers are
major aspects for business growth .therefore Cyndy classic beauty spa target customers are

a) Individual customers
These are clients who are passerby and will need our products and services. The location
of the business makes it more busy and with a lot of clients who came unexpected .These
customers or clients are characterized by, they need variety of products and they mostly
improvise buyers and they identity themselves to a certain social class among many
b) Institutional customers
These are institutions that will be using our products and services and they characterized
by, they buy products in plenty and their buying process is complex.

2:3 COMPETITOR ANALYSIS

Competition will be from business enterprises which offer the same products and services to our
spur. I will consider the strength and weakness in my business.

Strength and weakness of competitors

STRENTH

Customer satisfaction is one of the great assets of the company. The cost of the products will be
very pocket friendly and force them to choose the good one for the outstanding services.

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Customer can get all necessary services in one roof and they don’t need to go to different salon
for other services simultaneously with affordable packages.

WEAKNESS

Lack of experience is the huge weakness in business. The power of the business is not strong as
compared to other long lasting spars

Small capital and non-experienced employees will be the problem for the business

Below are some competitors in the area

Fay beauty spa

Their prices are fairly lower and stock high quality of products but they are of small scale

Lillian cosmetics and spa

They offer both high quality and low quality products but their prices are too high.

2:4 MARKET SHARE

This is to follow up the recent treads and adopting the good idea. The business targets an
approximation of about 2000 individuals and limited to have and maintain a minimum market
share of 55% as there will be more population and also the business will cater the need of all
clients.

2:5 PROMOTING AND ADVERTING

Advertisement will regularly come in the daily newspaper also posters will be fixed up in the
local areas to advertise our spar. The nearest shops will be referring the people for use of Cyndy
classic beauty spa services. At Cyndy classic beauty spa, promotion and advertising strategy will
be taking the clients pictures after service and advertise the service via whatsapp. We will also
ask clients for referrals and reward them with discounted or free services depending on the
number of clients they bring. We will also offer discounts to the new clients who have been
referred. There are plans for a lottery that will offer a free trip to India. A client would simply
refer new clients to use, and we will place a card box for each client he / she brings. The more
they bring the more they have a chance of winning a trip.

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2:6 PRICING STRATEGY

Choosing the right price for a product will allow me to maximize profit margins. A good rule to
remember when pricing products is that, your customers won’t purchase your products if your
price is too high but your business won’t be able to cover expenses if your price is too low. As a
small business owner, I am looking for ways to enter the market so that my products and services
become more well known. Cyndy classic beauty spa will do with penetration strategy as a
pricing method. Example of the laid down strategy which will be used to price the services and
products;

TABLE 1

PRODUCT PRICES (KSH)

Moisturizer 100
Cleanser 150
Toner 200
Facial scrubber 150
Massage oil 170
Enamel 100

TABLE 2

SERVICE PRICES( KSH)

Massage 1000
Makeup 1000
Manicure 900
Pedicure 600
Waxing 100

2:7 SALES TATICS AND SALES TARGET

A sales tactics is any action you take to put your sales strategy into action where, as strategy
explains your purpose tactics show the process you use to move forward. The sales tactic and
targets used at Cyndy classic spa are, will be giving my clients a glass of wine to drink while the
service is ongoing, also maintaining good interaction and been keen with the clients, and also

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develop the ability to actively listen to the client, and also use polite terms while talking to them.
Adhering to strict deadlines of each customer makes sales professionals lose credibility by
attaining this tactics, I will acquire more than expected customers.

2:8 DISTRUCTION STRATEGIES

Distribution the process of making a product or service available for the customer or business
user who needs it. This can be done directly by the producer or service producer or using indirect
channels with distributors.

i. Direct selling

This will be used to reach customers at their places of work, home and even in the villages to
inform them on the services we offer or any new product stocked.

ii. Indirect selling

I will employ a skilled person who will create an online page. The personnel will make an
interesting profile name.

2:9 CUSTOMER SERVICE

At Cyndy classic beauty spa, we will be issuing out magazines to the clients in case of any
desired styles for them to be satisfied by their choice. We will also be carrying consultation and
analysis to our clients to protect both the client and therapist and ensure that they do not perform
any treatment or service on a client that they may be detrimental to their wellbeing.

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CHAPTER THREE

3:0 INTRODUCTION
Cyndy classic beauty spa intends to have a simple structure since it’s a startup business grows as
the business grows since we have a vision of providing the highest level of customer service
therefore establishing a long lasting relationship of trust and commitment will enable us employ
only the qualified staffs who are professionals.

3:1 ORGANIZATION STRUCTURE

Below is an organizational structure we intend to use in business .

MANAGER

CASHIER

NAIL MASSUESE FACIAL

TECHNICIAN THERAPIST

Having a business structure is very important because it is easier to employ new positions in the
business and providing a flexible and ready means of growth .Also to provide guidance to all
employees by laying out the official reporting relationships that govern workflow.

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3:2 MANAGEMENT TEAM

3:2.1 MANAGERS

Role and responsibility

 Responsible of overall director of the business

 Leading and directing salon workers and managing finances
 Control every aspect of the salon
 Ensure the business runs smoothly
 Assigns tasks to employees and ensure they are carried out accordingly

Qualifications

 Must have a diploma in Cosmetology

 Should be alteast 28 years of age
 Should have alteast 3 yrs. of experience
 Should possess a certificate of good contact

3:2.2 Cashiers

Role and responsibility

 Keep a database of all purchase ,sales

 Keep accurate report of all stock
 Check level of inventory so as to know when to replen stock

Qualifications

 Should be atleast 25yrs of age

 Should have two years of experience
 Fluent in both Swahili and English
 Should possess a certificate of good conduct

3:2.3 NAIL TECHNICIAN

Role and responsibility

 Providing qualify hand and foot massages

 Ensuring that nail and massage supplies are adequately stocked

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 Evaluating the condition of clients nails and advising them on proper nail care and
suitable nail care treatments
 Providing nail and hand services to customers

Qualifications

 A certificate in cosmetology
 Should be alteast 12 years of age.
 Should have a year of experience

3:2.4 MASSUESE

Role and responsibility

 Offer massage services to customers

 Give feedback from the clients
 Good communication
 Effective communication involves both speaking and listening

Qualifications

 Must have a certificate in cosmetology

 Should be at least 18 years of age
 Fluent in Kiswahili and English
 Should possess a certificate of good conduct

3:2.5 Facial the Rapist

Role and responsibility

 Performing facial or body massage and treatment

 Removing facial or body hair through waxing
 Apply make-up and advising clients on makeup application

Qualifications

 Diploma in cosmetology
 At least one year of experience

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 Should be 18 years and above

3:3 RECRUITMENT, TRAINING AND PROMOTION

Our major competitive is to provide the highest level of customer services therefore establishing
a long lasting relationship of trust and commitment .We will make sure we recruit the best that
match the experience skills and talent for the roles and responsibilities for the position

All hired employees will work in a conducive environment so as to ensure that they attain in a
high level of productivity we intend to train young and talented employees we bring on board
.advertisement will also be aired on every Monday at 8:00am .finally we will have a welfare
package price in place that will show our employees that we care about their welfare.

3:4 REMUNARATION AND INCENTIVE

At Cyndy classic beauty spa, we came up with a package to offer salaries that are slightly higher
than our competitors we will also offer monthly treatment and pay vacations .we will offer gym
membership and offer insurances such as health related expenses .We will also come with a plan
to pay bonuses at the end of the year which is pegged on performance and a way of rewarding
the top performers.

3:5 LICENCES PERMITS AND OTHER REQUIRMENTS

In starting a business ,the business has to be registered with the registrar of business and get a
certificate .The business has to get a licenses from the local authority to carry out a business in
that area

We have registered our business with the registrar of business and we have also sourced a
business permit from Nairobi city council. We also intend to hire a lawyer to advise us from time
to time on legal matters concerning our business

3:6 SUPPORT SERVICES

As a startup it will not be cost effective to have all the services within the organization

Below are the services that we shall be sourcing outside our organization

 Insurance services
 CCTV services

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CHAPTER FOUR

4.0 METHOD OF ACQUIRING TOOLS AND EQUIPMENTS

Cyndy classic beauty spa, will buy the needed equipments in cash and since some equipments
are costly we will buy half the equipments in cash and the rest to be paid latter at an interest of
5% per month. The dealer of the equipments will be responsible of the repair and maintenance of
the equipments, and if any of the equipments is totally damaged, it will be replaced with a new
one.

4.1 CAPACITY UTILIZATION

The business which is situated at Nairobi County River Road next to Simba coach booking office
building at a space of 12m2 by 6 m2 .This will occupy all the services without overcrowding and
it is also affordable in rent payment.

Below is a layout of Cyndy classic beauty spa, on how we have utilized the space in our spa.

MASSAGE ROOM

DISPLAY ROOM FACIAL ROOM

WAITING ROOM

NAIL ART CONER

RECEPTION ENTRANCE

4.2 OPERATION STRATEGY

Cyndy classic beauty spa will have different strategies as so to provide the best services and
products. We deal with any new competitors by creating strong relationship with our customers
and always be on the lookout for new technologies in this field of beauty .Also at Cyndy classic

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beauty spa, the services will be affordable and perfect at customer satisfaction .After the service,
the client will be offered a glass of juice as an appreciation for choosing Cyndy classic beauty
spa.

4.3 OPERATION STRATEGY

The therapist will be at the spa at seven as the account opens so as to clean the spa and set
stations ready for the days services .There will be a brief meeting held at exactly 7:30-8:00am
just for the staff and the manager then opens the door at 8:00am after the meeting.

Also there will be a book that every staff will sign in after reporting and out after leaving once
the clients visit our spa for a service they will be welcomed at the reception and booked queued
to our professionals who attend to them as per service they require .After the service they will be
issued with receipt for payment as same is recorded at the accountant accordingly.

The spa will be closed at closed at 8:00pm after cleaning of the sheets and towels is done .The
spa will be closed by the accountant after the days calculations

4.3.1 OPERATION STRATEGY

i. Internal factors

Equipment

This will be experience when machines at the spa break down and needed to be repaired for our
service and business to run softly.

Financial risk

The financial risks depend on the financial structure of the business .It also depends on your
business transactions and financial systems like changes in interest rates or being over reliant on
one customer could affect business.

Sickness

Sickness will affect production of the business when an employee falls sick and doesn’t attend
his/her job and there are no other employees who can attend to the clients as per department

Government policy

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This can affect the production of the business ,because they can increase the rate of borrowing in
the business community ,and higher rates of lead to decrease consumer spending lower interest
rates attract investment as business increase production business do not thrive

Price wars

Companies may start a price war in order to gain cusromer and increase market .This happens
when companies compete for customers by dropping their prices below the rate of their
competitors.

Solutions

 The government to reduce policies so that the citizens can afford

 Security should be highly considered all over the country
 The employees should be trained on how to handle and carefully listen to customers.

4.4 REGULATIONS AFFECTING OPERATIONS

Permits & Licensing Where obtained Cash (Ksh)

Health Nairobi hospital 15,000.00

Trade license Nairobi city council 5,000.00

Entertainment Harman international 3,000.00

Operation permit Nairobi city council 11,500.00

Internet Kenya Network 4,500.00

Total 15,500.00

4.5 OPERATIONAL TIMETABLE /PRODUCTION SCHEDULE

Our business will be open as from 8:00 am and close at 6:00pm from Monday to Saturday
.Employees shall report early by 7:00 am for cleaning and arrangement. We will be carrying
stoke taking every last Saturday of the month so as to increase gross profits ,reduce loss, improve
control of allowances and reduce waste .it will also help us to disclose where we going wrong
and have the opportunity to fix .

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CHAPTER FIVE

INTRODUCTION
This chapter will highlight financial plan, pre-operational cost, cash flow projections, income
statement and balance sheet

5.0 FINANCIAL PLAN

This is a comprehensive evaluation of an investor’s current and future financial state and this will
involve all the funds required to meet objective of the business.

5.1 PROPOSED CAPILIZATION

The proposed business will require a capital of 200,000 for it to be able to operate effectively.

The capital will be acquired as follows in the table below

Source Amount Percentage %

Family 100,000 65%
& friends

Bank loan 90,000 25%

Partner contribution 60,000 10%

250,000 100%

5.2 PRE OPERATIONAL COST

Item Amount
Rent 6,000
Insurance 2,000
Water 500
Licenses & Registration 4,000
Fire safety certificate 10,000
Electricity 2,000
Advisement 3,000
Internet subscription 3,000
Health certificate 1,000
Equipment and machinery 102,000
131,000

5.3 WORKING CAPITAL POTENTIAL SALES

This is the capital of the business that will be used for its day to day operations. The amount of
the money to be used in the daily operation of the business will be 65,000

Proposed capitalization –pre –operational cost = working capital

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200,000 - 131,000 = 61,000

5.4 POTENTIAL RISKS

5.4.1Fire

Fire in the spa can be caused by electric wires due to power fluctuation which can lead to
breakdown of some equipment.

The solution will be the spa will have the right extinguishers to match the fire risk .also we will
install electric gadgets that will regulate the voltage power.

5.4.2 Theft

Theft can be committedly someone outside your business or one of your employees.

In order to prevent theft we will have guards to watch our business at night and we will install a
security system and always respond to security alarms.

Also we will separate employee’s duties. The person responsible for receiving cash should not be
responsible for handling clients.

5.4.3 Falls

It might seem obvious, but one might fall in a spa perhaps nothing more than a small fright will
happen, but you can also experience a fracture, due to uneven floors, cables spread on the floor
or liquid like water. One can also injury his or her head.

The solution to falling, we will ensure that the spa is carefully maintained and all equipments are
safe. Also wet floors will be dried immediately.

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5.5. PROFOMA INCOME STATEMENT

CYNDY CLASSIC BEAUTY SPA

PROFOMA INCOME STATEMENT

YEAR 1 YEAR 2 YEAR 3

SALES 100,500 100,500 100,500
GROSS PROFIT 100,500 100,500 ` 100,500
201,000 201,000 201,000

LESS EXPENSE

Salaries/ wages 60,000 60,000 60,000

Rent 60,000 60,000 60,000
Electricity 24,000 24,000 120,000
Water 6,000 6,200 6,300
Advertisement 36,000 36,000 36,000
` 186,000 186,200 186,300
Net Profit 15,000 14,800 147,700

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5.6 PROFOMA STATEMENTS FINANCIAL

CYDY CLASSIC BEAUTY SPA

PROFOMA STATEMENT OF FINANCIAL PROJECT

YEAR 1 YEAR 2 YEAR 3

NON CURRENT ASSETS 120,000 100,000 98,000
TOTAL NON CURRENT ASSETS 102,000 100,000 98,000

CURRENT ASSETS

Debtors 90,000 92.000 94,000

Cash on hand 55,000 58,000 60,000
Cash in bank 150,000 152,000 155,000
Total current assets 295,000 302,000 310,000

CURRENT LIABILITIES

Creditors 58,000 60,000 58,800

Total liabilities 237,000 242,000 253,000

Total assets 339,000 344,000 355,00

Financed by;
Bank loan 139,000 140,000 141,000
Capital 200,000 200,000 200,000
Total 339,000 340,000 341,000

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