TITLE: BUSINESS PLAN

PRESENTER: VINCENT ONYWOKI MAN’GAA

INDEX NO.: 5520011396

INSTITUTION.: RIFTVALLEY INSTITUTE OF SCIENCE AND

TECHNOLOGY

COURSE : CRAFT CERTIFICATE IN INFORMATION

COMMUNICATION TECHNOLOGY

CENTRE CODE : 552001

PAPER NO: 1920/107

PRESENTED TO: THE KENYA NATIONAL EXAMINATION COUNCIL

PURPOSE FOR THE PARTIAL FULFILMENT FOR THE

AWARD OF CRAFT CERTIFICATE IN INFORMATION

COMMUNICATION TECHNOLOGY

SUPERVISOR: ANDERSON MARITIM

SERIES: JULY 2023

i
 TABLE OF CONTENTS
DECLARATION..........................................................................................................................iv
DEDICATIONS.............................................................................................................................v
ACKNOWLEDGEMENT...........................................................................................................vi
EXECUTIVE SUMMARY.........................................................................................................vii
CHAPTER ONE............................................................................................................................1
1.0 BUSINESS DESCRIPTION..................................................................................................1
1.1 EDUCATION BACKGROUND.........................................Error! Bookmark not defined.
1.2 RELEVANCY BUSINESS EXPERIENCE........................Error! Bookmark not defined.
1.3 BUSINESS NAME AND ADRESS....................................Error! Bookmark not defined.
1.4 BUSINESS LOCATION.......................................................................................................2
1.5 FORM OF OWNER SHIP.....................................................................................................3
1.6 TYPE OF BUSINESS............................................................................................................3
1.7 PRODUCTS...........................................................................................................................4
1.8 JUSTIFICATION OF THE OPPORTUNITY.......................................................................4
1.9 INDUSTRY...........................................................................................................................5
1.10 COMPUTERS......................................................................................................................5
1.11 BUSINESS GOALS............................................................................................................5
1.12 ENTRY AND GROWTH STRATEGY..............................................................................6
CHAPTER TWO...........................................................................................................................8
2.0 MARKETTING PLAN..........................................................................................................8
2.1 CUSTOMERS........................................................................................................................8
2.2 COMPETITION.....................................................................................................................9
2.3 MARKET SHARE..............................................................................................................12
2.4METHOD OF PROMOTION AND ADVERTISING.........................................................13
2.5 PRICING STRATEGY........................................................................................................15
2.6 SALES TACTIC.................................................................................................................16
2.7 DISTRIBUTION STRATEGY...........................................................................................17
CHAPTER THREE.....................................................................................................................18
3.0 ORGANIZATION AND MANAGEMENT........................................................................18

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 3.1ORGANIZATION STRUCTURE........................................................................................18
3.2 REMUNERATION AND INCENTIVES...........................................................................22
3.3 LICENCE PERMITS AND BY- LAWS.............................................................................23
3.4 SUPPORT SERVICES........................................................................................................24
CHAPTER FOUR.......................................................................................................................25
4.1 PRODUCTION DESIGN AND DEVELOPMENT............................................................25
4.2 PRODUCTION STRATEGY..............................................................................................27
4.3 OPERATION AND PRODUCTION PROCESS................................................................29
4.4GOVERNMENT REGULATION AFFECTING OPERATIONS.......................................30
CHAPTER FIVE.........................................................................................................................31
4.0 FINANCIAL PLAN.............................................................................................................31
4.1 PRE OPERATIONAL COST..............................................................................................31
5.2 WORKING CAPITAL REQUIREMENTS.........................................................................32
5.3PROJECTED CASH FLOW STATEMENT........................................................................33
5.5PRO-FORMA BALANCE SHEET......................................................................................35
5.6 BREAK EVEN POINT........................................................................................................36
5.7 DESIRED FINANCING......................................................................................................39
5.8 PROPOSED CAPITALIZATION.......................................................................................40
APPENDIX.......................................................................................Error! Bookmark not defined.
Business location........................................................................Error! Bookmark not defined.

iii
 DECLARATION
I hereby declare that this prepared work is mine, through experience, participation and

inventions and therefore submit this business plan to Kenya National Examination council

for the award of academic qualification of craft in information communication technology

Candidate: VINCENT ONYWOKI MANGAA

Sign ……………………………………………………

Date ……………………………2023

Supervisor name: ANDERSON MARITIM

Sign ………………………………………………

Date:…………………………………2023

iv
 DEDICATIONS
Sincerely, I dedicate this business plan to my parents and entire family for their financial

support and prayers.

v
 ACKNOWLEDGEMENT
My great appreciation goes to my parents Mr. and Mrs. MANGAA and my entire classmate

who assisted me towards the success of this project. My sincere gratitude goes to my teacher

Family and friends

Special thanks to God knowledge to skills and also the gift of life he has provided.

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 EXECUTIVE SUMMARY
Chapter one, the introduction of the business in which the business entails its description,

growth entry strategy and also goals of the business.

CHAPTER TWO

Chapter two entails the marketing plan, location of the business, type of customers to be

served in terms of demand and supply, also in this chapter its highlights the number of

competitors in the area and it includes the promotion and advertising methods.

CHAPTER THREE

The chapter entails the production and operation of the business and how it will be

conducted. It shows the operational plan; this includes transaction and daily basis and various

policies and regulations to achieve. The objectives and goals. It also provides the facilities

and capacity to be needed in terms of finance.

CHAPTER FIVE

Chapter five entails financial plan section whether the business investment will be successful

or not. It provides the pre- operational costs, working ital., pro-forma income statement,

balance sheet, cash flow and comprehensive section which weigh the profit or loss in

business.

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 CHAPTER ONE

1.0 THE SPONSER

The sponser of the business will be Vincent onywoki aged 23 years he is a resident of

Magena Kisii county.

The owner began her education in the 1998 at Magena township primary school then she sat

for her K.C.P.E (Kenya primary of primary education) and he passed well. She later joined

inchini high school still in Kisii county as from 2017-2021 where he sat for her K.C.S.E

exam and attained a mean grade of D which enabled her join Rift valley institute of science

and technology the year 2021 September to undertake certificate in information technology

which he is still undertaking till her completion 2024.

1.1 BUSINESS DESCRIPTION

The name of the proposed business will be Mr.vinsel restaurant. It will mainly offer foods

and beverages and mainly outside caterings for weddings and any other events. It is a sole

proprietorship kind of business which will be located Kisii town opposite Kisii Academy

two km from Kisii-Nairobi highway. It will be positioned next to a police station and a

district hospital bearing in mind that all residents from Kisii town will benefit from

business.

1.2 NATURE OF THE BUSINESS

It is a sole proprietorship business and it will be located in Kisii County opposite Kisii

Academy that is 2km from Kisii-Nairobi highway. It will offer food and beverages mainly.

The location of the business is more strategic as it will attract more clients, infrastructure is

well developed e.g. road, postal services and hospitals.

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1.3 BUSINESS LOCATION AND ADDRESS
The business will be located in Kisii Town opposite to Kisii academy school that is 2km from

Kisii- Nairobi road. It will be positioned next to the police station and district hospital,

bearing in mind that this market serves nearby every residents of Kisii town. The location of

the business is more strategic as it will attract more clients, the infrastructure is well

developed e.g. roads, postal services hospitals etc

MR.VINSEL RESTAURANT

P.O BOX 525

KISII

TEL: 0710636044

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1.5 FORM OF OWNER SHIP
The proposed business will be owned by one person hence form of ownership being sole

proprietorship kind of business. The choice of this form of business is based on the benefits

its brings along like decision making is easier, job security, personal satisfaction where one

works to be best of his ability and the chances to easily the profits and all the income from

the business.

The proposed capitalization will be as follows:

Source Amount (Kshs.)

Owners equity 250,000.00
Bank loan 250,000.00
Donation from parents 350,000
Total 850,000

1.6 TYPE OF BUSINESS

The business will be a large scale that is wholesaler business which will only deal with

domestic customers only in order to maximize profit, maintain good standard, expand the

business to Mr.vinsel restaurant hotel and relate the image of health and nutrition balance

food.

The business will be a service business and it will be a start up business with the potential to

more customers for the quality of services and product it will after.

The potential customers of the business will be:

i. Town residents

ii. Staff from nearby schools, hospitals together with the students

iii. The staff of DOS office and police station.

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1.7 PRODUCTS
The business will offer product. The product will be high quality meals which will be

prepared in the restaurant workshop. Drinks such as soda, wines, beer and fresh fruit juice

will be also offered to the customer.

SERVICES

Services to be offered will be entertainment such as movie watching which will be done in

the restaurant and swimming. The customer will benefit from the business by exploiting their

taints, swimming and other activities that will be carried on in the business premise.

The business will be very economical since it will centre for people of all types in the society.

1.8 JUSTIFICATION OF THE OPPORTUNITY

With the present ever being an inflating world, decided on this business to local needs of the

people and also to the satisfaction of the market.

The reason for this business includes:

a) Proximity to customers -The location has a large number of the customers because

its near hospital, main market school etc.

b) The town is well serviced with good infrastructure throughout the region hence

making communication to the premise easy and also ordering of goods easily and

accessible

c) Mr. Vinsel restaurant will be situated just some kilometers from DOS office and

police station hence enough security is guaranteed.

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1.9 INDUSTRY
Mr.vinsel restaurant falls under the hotel industry catering because its deals with high class

product.

The technology used in modern thus reduces incidence of fraud. Through competition the

business will take advantage of selling at lower prices and high quality products that the

customer can meet high quality due to use of modern technology.

1.10 COMPUTERS
Computers will also be used in business office for accounting and counting and record

keeping.

The industry will be both capital and labour intensive where both manpower of machines will

be used.

1.11 BUSINESS GOALS

The key goal of business is:

SHORT TERM GOALS

Up to one year, the business will have the following;

Started the business and run it without loss

Goal to achieve it and maximize profit which will help business.

Expansion of the hotel to five stars status.

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LONG TERM GOALS

After ten years the business has expanded and able to do the following ;

To offer training to local employees at a far cost for them to gain experience to start their own

business in future.

To meet customers need and take a part in national development by catering job opportunities

To make project by giving back to the community.

1.12 ENTRY AND GROWTH STRATEGY

With this, in market competitive industry the proprietor put measures that would ensure that

customer know to the business and eventually stick to it. These measures include advertising,

using of media putting posters and sign board by introduced decoration of inside and outside

features displayed example swimming pool, roasted kitchen etc and lastly acquiring tenders

and equation from various schools hospitals within the town.

GROWTH STRATEGY

In order to penetrate and gain acceptance in the market advertisements through media and use

of sign boards.

Pricing will be for getting to know the weakness of the relevant competitors and rectify

where necessary and gain popularity.

Increasing the scope of the product and services and number of employees to enable to

achievement of maximized profit with the business.

The business will be able to penetrate and gain market acceptance and preference by offering

products at fair prices to the customer, offering offer sales services and ensuring products are

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proved by Kenya Bureau of standard so provide customers with foods of high quality and

quantity and should be available at the right time

The management will be carried out by the owner of the business so as to ensure that the

business is going well and working towards achieving business objectives

The business will acquire funds from personal saving, bank loans and borrowing from family

and friends.

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 CHAPTER TWO

2.0 MARKETTING PLAN

This is very essential in the business since it indentifies potential customers and shows how

to influence win them. It is employee mainly for business prosperity.

2.1 CUSTOMERS
The customers who will be buying from Mr.vinsel restaurant industry are as follows:

a) Schools

b) Hospitals

c) Churches

INDIVIDUAL CUSTOMERS

These are customers from surrounding business premises they can be described in terms of :

i. Age – they lie eighteen years whereby 85% are male and 15% are female.

ii. Marital status – most of them should be married.

iii. Purchasing pattern - they are of high class and medium class living therefore capable

of purchasing as much as possible. They have tendency of typing to complete for

materials in order to acquire and achieve personal satisfaction

iv. Religion background –around 80% should be Christian and 20% Muslims and the

other religions despite this differences lifestyle has become and expect to cherish

modern lifestyle of drinking and eating together as well as balanced diet as family and

sharing ideas .

v. Occupation- most of them should be business means and women’s hence stable in

their standards of living, others are farmers depending on farm produce. Those who

work in parastatal, Ngo’s and government institutions like hospitals, has courts and

police stations.

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 vi. Level of education – most of this customers should be literate, a few should be form

four levels, about 15% degree graduates and 10% PHD Holders.

INSTITUTIONAL CUSTOMERS

Most of the customer rulers this category will be the surrounding institutions for

example schools, Kisii academy, Kisii high secondary and mercy boarding, hospital

includes Kisii district hospital, churches that are within Kisii town and all these inter

denominational require hotel service and products.

2.2 COMPETITION
Being like any other business there are some competitors around Kisii town that

operates similar business. They include

Kisii hotel Industry

Oasis hotel industry

Empire hotel industry

a) Kisii hotel

Is located a few meters from hotel products and services.

Business strength of Kisii hotel

 Good exposure to customers and supply of material.

 They are week informed of market trend of products they deal with.

 Have regular opening and closing hours

 Have spacious premises and built to meet all modern requirements hotel

product items.

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WEAKNESS

They charge too high prices for their product and services

Their prices vary from person to person

They are poor located, hindering access to customers who do not know their location.

Oasis hotel

It is a few meters from town. It is visible site’ hence easily identified. It mainly deals

with hotel products and items although they carry out other services and

accommodation.

Strength of oasis

It has some branches in Kisii town

Worker has working experience of about 7 years

It is on strategic which is visible and near the road.

It has large space outside the premises.

Weaknesses

 The proprietor undertakes selected service .can only offer hotel products and

items omitting other types of services.

 Services are very slow hence discouraging customers because of time wastage.

 Number share holders time for operation

 Highway hotel industry

Mr.vinsel restaurant

Strength of hotel industry

 Good and services are of high quality

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  Has very hardworking employees

 Employees create a good relation with customers hence attracting them

 It is located on the highway hence attracting more customers.

Weaknesses

i. Over changing goods and services hindering to customers complains

ii. Poor payment of workers hence not paid according for their professional

background.

iii. They have irregular working hours i.e. opening and closing hours

iv. The workers are trust working and reputation of losing customers workers.

v. Mr.vinsel restaurant will capitalize on weakness of competitors.

 Having regular opening and closing hours

 Leaping on delivery date to avoid inconvenience of customers.

 Developing of good public relations

 Safe guarding customer’s properties to avoid any loss or manage i.e.

budging proving etc.

 Recruiting and maintaining high skilled labour force with god customer

relation as well.

 Proving of quality goods and services

 Proving fair prices of goods and services.

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2.3 MARKET SHARE
the proprietor carried out are search in area and regions surrounding mr.vinsel restaurant and

competitors enterprises come in an estimated number of ten thousands potential customers

who can be accessed in business duration or one month. The distribution of their customers is

as below;

A 25 285
B 32 30
C 28 22
D 29 20

A
B
C
D

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2.4METHOD OF PROMOTION AND ADVERTISING
a) Advertising

In advertising business, I will cooperate the following strategies before Mr.vinsel restaurant

industry attains its highest financial stability.

b) Through the radio

Most of the people in this area listening to local radio station.

c) Posters

Posters and bill boards will erected at strategic points to give both awareness and direction to

the customer example:

MR. VINSEL RESTARANT

P.O BOX 525 KISII

LOCATED OPPOSITE TO ACADEMY SCHOOL

Come one come all

The hotel with a high quality service

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 d) Using agent and legal customers

These agents will aught antibody they meet in town giving the small business cards which

contain necessary information concerning the business location goods, services offered and

their cost.

e) T –shirts and apron

The proprietor will make sure that all employees under Mr.Vinsel Restaurant industry should

well design with t- shirts or aprons contain labels and the name of the business and address.

Printing calendars

Calendars bearing the name of the industry will be printed and sold at fair price. Also any

customer who buys Gouda exceeding Kshs. 5000 will be issued business location address

goods services offered. To evaluate the volume of customers and rate of sales after a given

advertisement period.

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2.5 PRICING STRATEGY
Mr.vinsel restaurant industry will calculate the price of the product by cost of production plus

profit. It will use the figure got as the price of product.

Mr.vinsel restaurant industry will consider in setting prices such as competitors price so as to

attract many customers.

To the business, it will also consider factors like government policy in pricing of against the

laws . The price will be variable depending on the volume of products in large quantities will

be sold at a slightly in large quantities. This will enable the business to be able to make more

profit and sells of hotels services

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2.6 SALES TACTIC
Proper advertising and promotion is required however such tactics are vital in ensuring

goods and services reach the customer. The following are sales that Mr. Vinsel restaurant

industry will employ;

1. using agent

Having of agent will go out and order for the business. They will get remuneration form of

commissions.

2. Direct selling to customers over counter

This will involve customers coming directly to the premise and buying ready made goods

and services.

3. After sale services

For customers who place large order goods rice within 5km will have transportation services

and other sales services will be intended to explain technology or goods the customers can

understand.

4. Using loyal customers

A well served customers become loyal to the business and will spread the quality services

and goods the business offer

5. Discount

A level of sale of goods and services will be set whereby discount will be offered to that

particular customer. In other words 5% discount will be given on goods exceeding 50,000 $

10% exceeding a 100,000.

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2.7 DISTRIBUTION STRATEGY
The owner of the business has implemented a simple distribution channel which will be

forced from the procedure supplier, retailer and then to customer . The owner has chosen it

because of its simplest and fast flow of the product from one channel to the other. The

business will help the customer to transport their product to their places.

In conclusion there is number much transportation problems which can hinder customers to

buy goods and services since the roads are not tarmac there is need to improve them through

renovation during dry season.

17
 CHAPTER THREE

3.0 ORGANIZATION AND MANAGEMENT

Mr. Vinsel restaurant industry is proprietorship type of business. The owner will be

responsible for all the liabilities of the business because the owner of the business.

The business will be large scale and size and managed by the owner. The owner has relevant

skills in food production and the management plan will be subdivided

3.1ORGANIZATION STRUCTURE

MANAGER

FOOD PRODUCTION
RESTAURANT SERVICE
SUPERVISOR
SUPERVISOR

COOKS WAITERS
Manager

Qualification

 Qualified in degree of management in food and beverage.

 have three year experience in food and beverage establishment

 Have good public relation.

Duties and responsibility

 Organize goals and objectives. The owner will set the business goals and objective to

be fulfilled during a given period of time and grow to attain financial stability.

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  Purchase of goods . The role of the manager will be to purchase goods and services

by signing all business transaction that is supposed to take place in the firm.

 Encouragement and motivation of workers, encourage as well motivate workers

through slowing a good example in doing the responsibilities

 Salary payments . the owner will take up the duty of paying alary to the workers

 Recruitment and termination of workers. The manager should maintain the quality

and improve the standard of the business thus should employ qualified workers.

Restaurant service supervisor

Qualification

 Aged 27 year and completed diploma in service management.

 Two year experience.

Duties

 Supervision general work within the establishment

 Arrange transportation of the goods from the store to customers especially those in

need of services items.

 In absence of the manager gives orders to the workers.

 Salary will be Ksh.6,000

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Food production supervisor

Qualification

 He must have diploma in food production

 Aged of 28 years and above

 Must be a computer literate

 Three year experience

Duties

 Supervision general work in food production area.

 Formulating the sales and expenditure budget for the outlet.

 Determines the portion size in relation to the selling price.

 Purchasing all materials both food and drinks.

Waiters

 Qualification

 Aged 20 -30 years old

 Have a certificate in food and beverage

 Have two years working experience

Duties

 Carrying food from the kitchen to customers on the table.

 Distributing food checks to the kitchen

 Carrying out some cleaning during service.

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Cooks

Equalization

 Aged 25 -30 years old

 Have certificate in food and beverage

 At least one year working experience.

Duties

 To prepare daily meals on time

 To maintain cleanliness in the kitchen.

Others security officer

Qualification

 Should be a form four learner

 Must be a registered security personal and from loading security first.

 Must be honest, trustworthy and vigilant

 Must have a certificate of good conduct.

Duties

 Keep vigilance at the entrance

 Protect the business property

 Safeguard the customers and personnel from any attack

 Guide the customer to the packing area.

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3.1 RECRUITMENT, TRAINING AND PROMOTION

The manager in charge has overall charge to recruit and train the trains and promote them.

The trainee require special training to make sure he or she has qualified according to the

duties that one has being performing

This recruitment and training requires the following;

Having acquires the skill

Performing all duties as required in the hotel.

Punctuality that able to keep time

All these enhance the manager to promote his or her employees according to their

performance in the hotel as required.

3.2 REMUNERATION AND INCENTIVES

Remuneration

The business will pay employees on time to ensure that their personnel financial need are

centre for promptly thus keeping working the allocation of the salary will majority depend

upon the qualification and the existing salary rates in the current market. Implement on

salary will be granted to employees in case there is an increase in productivity. An allowance

of 5% will be given to every employee on salary each month.

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Incentives

The business will employ the following incentives to motivate its employees. It will provide

good working condition for the employees by ensuring that everything is provided for:

 Giving off and paid leaves to employees

 Housing allowances

 Paying them for trips

 Awarding them with certificate

End of your parties.

3.3 LICENCE PERMITS AND BY- LAWS

 For each business to be allowed to run

 It must have a firm license from the county councils of district. The following license

must be obtained by the business for smooth running of the business.

Trading license

It is normally issued authority which in this case is the municipal council. The payment of

the license cost Ksh.3,500 and its renewal every year.

Permits

The permits will be obtained after the public health officers inspect the firm under the

following;

i. Toilets – This are number of pit latrines that have been constructed to be used by

employees and customers who are visiting the premises to purchase hotel product.

ii. Cleanliness – it is the most important factor which the business should really observe

because it has issued that should be addressed to keep the entire environment clean.

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 iii. By laws – some of the by laws affecting the business are:

a) Approval of buildings

b) Disposal site

c) Lateness

d) Cleanliness

3.4 SUPPORT SERVICES

For smooth and efficient running of the business will be committed to the support of the

following services which will be in turn enable the business to attain its set of goals.

Banking services

Commercial Bank of Kenya

P.o box 200,

Kisii

Legal services

David and Nick Advocates

P.o Box 100

Kisii

Management services

Nuru management services

P.o box 84

Kisii

This is a sector is important because the customers will make their orders through this

address.

24
 CHAPTER FOUR
4.0 OPERATIONAL AND PRODUCTION PLAN

Mr.Vinsel restaurant realize the fact that customers want quality products and services for

this season packing of food products items will be done to satisfy customer needs.

4.1 PRODUCTION DESIGN AND DEVELOPMENT

i. All food items will be listed on menu cards for indentifying prices and portion. The

shelves will be divided into small sub units and each small unit will be labeled in bold

letters and certain food items will be placed to save time packing of the food products

will be done in special papers bearing the business name and contacts to avoid fraud.

Then it will be kept inside the polythene bags making it easy to handle

ii. The enterprise will be time conscious in its work to ensure that the customers are

satisfied highly qualified workers will be employed to give food services.

Equipments

Items Quality Cost unit Total Supplier

Hollow wane 50 250 12,500 Ukwala
(plates ) supermarkets
Mops and 10 300 3000 Blancho industry
buckets
Chairs 50 750 37,500 Jua kali industry
Tables 10 1,200 12,000 Jua kali industry
Electric cooker 3 2500 7500 Gilanis
Gas cooker 2 4700 9400 Gilanis
Fridge 1 25000 25000 Gilanis
Set of cups 5 200 1000 Ukwala
Set of spoons 5 150 750 Ukwala
Set of folks 5 200 1000 Gilanis
Trays 10 100 1000 Gilanis
Frying pan 2 150 300 Gialnis
Brooms 20 200 4000 Gilanis

25
OTHER EQUIPMENTS

To make the working environment to be conducive inside and outside the premises other

equipments must be installed this include

Item Installation Total

Electricity 5000 5000
Water 1800 1800
Fire extinguisher 3000 3000

12,800

Fire extinguisher will be regularly checked to ensure the enterprise is on the safe side of the

fire incidence.

The business will be insured with G.A.P.C.O. insurance company limited by the start of 3 rd

year . It will cover the enterprise and workers effective running the business, they will require

some other facilities and equipments for operators. This includes;

Repair and maintenance

Regular repair and maintenance is intended to be observed in firm to minimize cases of

faults. Machines like electric cookers gas cookers, refrigerators will be regularly checked to

minimize the cases of failure during working hours.

Routine maintenance will be done on the other tolls and equipments like knifes which will be

regularly sharpened and replacement of Brockenutensils with new ones will also be done.

26
Monthly material requirements

Type Of Frequencies Source Quality Cost Per Total

Materials Required Unit
Potatoes 1 Month Chpseon 3 Sacks 300 600
Month
Cooking Fat 1 Month Ukwala 3 Bands 450
Supermarkets
Maize Flour 1 Month Chepseon 3 Sacks 300 600
Salt 1 Month Ukwala 5kg 6000 300
Sugar 1 Month Ukwala 100kg 80 8000
Tea Leaves 1 Month Gilanis 10 Bands 90 900
Baking 1 Month Ukwala 30 Pkts 15 450
Powder
Meat Daily Kac Daily 9kg 50 450
Farmers
Milk Daily C.O Products 5 Litres 20 10,000
Bread Daily Pco Growers 10pcs 250 25,000
Sausage Pco Growers 10pcs 12pkts 90 1080
Daily
Cabbage Daily Chepseon Half Sack 60 300
Carrots Daily Chepseon 2kgs 30 6000
Onions Daily Chepseon 3 Kgs 40 700
Total 50,353

4.2 PRODUCTION STRATEGY

Qualified and experience person of sales and customers satisfaction, one acquires them and

interviews will be done to any personnel to be employed. The follwing strategic will be used;

Use of experienced and skilled workers

They should be aware of modern products in the market to improve technology change.

Proper handling of tools and equipments

For proper handling of goods and equipments available within the business premises should

be observed.

Selling and stocking of quality products

The workers should be able to identify products and purchasing from trusted dealers.
27
In order to get maximum employee production once will;

Provide a clean environment

Proper remuneration

Maintain a good employed employer by giving them freedom to new better ways of doing

things.

Monthly requirement

Direct labour

Labour Working Working Wage per Wages per Day of Total

hours per per month day hour working
day
Cleaner 10 300 167 16.7 7 5,000
Total 5,000

Indirect labour

Labour Working Working Wage per Wage per Day Cost

hours per per month day hours working
day weeks
Manager 8 24 517 64.5 6 15,500
Cashiers 10 300 384 38.4 7 9000
Security 14 420 234 17 7 400
men
Chef 7 210 517 48.5 5 7000
Total 41,000
Total monthly Production cost
Overhead 854,400
Labour direct 5000
Labour indirect 34000
Material required 50,353
Total 149,2000

Total labour cost

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4.3 OPERATION AND PRODUCTION PROCESS
This ensures that every month there is sales and replacement of stock to ensure continuity of
the business.

Customer

Received at the counter

Customer places order

Working on order starts

Customer pay and collect unit

29
4.4GOVERNMENT REGULATION AFFECTING OPERATIONS

As a business is concerned the owner hopes to ensure that all legal terms and compliance
required by the government will be adhered to effectively run the business.

Income tax

All the tax required by the government will be paid in term to ensure that the business will
operate properly as required by the owner.

Trading license and permits

The business is entitled to obtain a trading license and permits from the local government so
that it can run without any difficult and serve the potential customers effectively.

Public health Act.

This act embraces on the need to know in a clean environment with proper seating clean
water and food.

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 CHAPTER FIVE

4.0 FINANCIAL PLAN

4.1 PRE OPERATIONAL COST

ITEMS AMOUNT
REGISTRATION and business license 20,000
Purchase of fixed assets 300,000
Advance rent payment 30,000
Insurance policy 14,000
Consultation fess 6,000
Office furniture and settings 50,000
Advertisement 15,000

Total 435,000

These are the expenses inquired before starting the business operation. Its enables the

manager to review the performance of the business.

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5.2 WORKING CAPITAL REQUIREMENTS
This is the capital requirement for the first three year of operation.

Item Amount in Kshs

Material e.g. 50,000 53,000 60,000
floor sugar 40,000 15,000 20,000
Cash at hand 20,000 45,000 50,000
Cash at bank 15,000 15,000
Taxes
Total 125,000 128,000 130,000
The business management intends of not employing new workers before the 3 rd year. The

bank rate is assumed not to change.

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 5.3PROJECTED CASH FLOW STATEMENT
Jan Feb march Apr May June July Aug. Sept. Oct. Nov. Dec. Total
Cash flow 150,00 100,000 200,000 250,000 3000,000 350,00 400,000 450,000 500,000 550,000 6000,000 650,000 45,000,00
0 0
Collection of 5000 5,000 10,000 10,000 10,000 130,000
debtors
Total cash inflow 200,00 150,000 200,000 250,000 31,0000 360,00 400,000 460,000 500,000 550,000 600,000 650,000 4630000
0 0
Cash flow cash 60,000 55,000 40,000 350,000 35,000 45,000 45,000 30,000 30,000 40,000 440,000 350,000 490,000
purchase

Payment to 4,000 4,000 10,000 4,000 5,000 10,000 10,000 4,000 51,000
creditors
Rent 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 120,000
Salaries wages 65,000 51,000 65,000 65,000 65,000 65,000 65,000 65,000 65,000 65,000 65,000 65,000 776,000

Telephone 6,000 3,000 2,000 2,000 3,000 3,500 3,500 2,500 2,500 3,000 30,000 35,000 37,500
Electricity and 4000 4,500 3,500 3000 4000 3,500 3,500 4000 4,500 4,500 4000 3000 46,000
water
Loan repayments 10,000 10,000 15,000 15,000 15,000 10,000 10,000 20,000 20,000 15,000 10,000 20,000 170,000

Insurance 10,000 4,000 4,000 4,000 4,000 4,000 5,000 5,000 5,000 5,000 5,000 5,000
T –cash outflow 165,00 137,500 139,500 134,000 140,000 145,00 152,000 140,500 142,000 152,500 147000 14500 1740500
0 0
Net cash 35,000 12,500 60,500 116,000 170,000 215,00 248,000 319500 358,000 397,500 453,000 504500 28895000
0
Accumulated 35,000 47,500 108,000 294,000 394,000 609,00 857,000 117650 1540500 1932000 238,500 2889500
cash 0 0

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34
5.4 PRO-PROMA INCOME STATEMENTS FOR THE YEAR END IN 31 ST MAY OF

2024

Item 1st year

Less Cost of Goods 420,000
Gross Profit 1,410,000
Expenses 613,000
Salaries and Wages 35,500
Transport 30,000
Telephone Bills 20,000
Payment to Creditors 4,000
Advertisement 32,000
Loan Interest
Total Expenses 740,500
Net Before Taxes 669,500
Tax Provision 66,950
Net Profit After Taxation 602,550
Net Profit 602,550

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5.5PRO-FORMA BALANCE SHEET
Fixed assets Kenya shillings
Machines 30,000
Computer 150,000
Furniture and fitting 60,000
Total 240,000
Current assets
Stock of raw materials 50,000
Debtors 10,000
Cash in bank 40,000
Cash at hand 20,000
50,000
10,000
40,000
20,000
Total current assets 120,000
Total assets 360,000
Current liabilities
Creditors 50,000
Bank over draft 45,000
Total current liability 125,000
Owners equity 70,000
Loan from bank 200,000

270,000
Long term liabilities
Loan from bank 200,000
Capital 35,000
Subtotal 235,000

Total assets 360,000

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5.6 BREAK EVEN POINT
Fixed cost Kshs.
Salaries 613,000
Licenses and permits 25,000
Furniture and fittings 50,000
Insurance 14,000
Building 30,000
Total 732,000
Variable costs
Water and electricity 10,000
Telephone 36,000
Transport expenditure 35,500
Total 81,500

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Breakeven point

Contribution margin= sales –total Variable cost

=1,830,000 – 31,500
=Kshs 1748500
Percentage on contribution margin = Contribution Margin + 100
Sales
1748500x100

=96%

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Total costs

=1,198,000

Breakeven point of sales in shillings

= total fixed costs x100

Contribution margin

1198000

= Kshs 12538.40

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5.7 DESIRED FINANCING
Item Amount (Kshs)
Pre- operational cost 435,000
Working capital 135,000
Miscellaneous 11,000
Total 581,000

40
5.8 PROPOSED CAPITALIZATION
Source Amount(Kshs)
Owners contribution 100,000
Loan from bank 200,000
Equity 400,000
Parent 30,000
Total 1,000,000

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 BUSINESS LAYOUT

Waiting Kitchen
reception

Hall way

Dining
area
Comfort rooms

Parking

42
LOCATION MAP

Roadside hotel
Mutate stage

Mr. Vinsel restaurant

To kisii - keroka
Chelan traders

Academy High way station

Police station Oil Libya station

To – Medical services

43