Professional Documents
Culture Documents
Business Plan Mulozi
Business Plan Mulozi
LTD
DRAFT
BUSINESS PLAN
TO TRIPPLE PRODUCTION OF FRUIT & WOOD
SEEDLINGS
JULY 2023
1
Contents
0 EXECUTIVE SUMMARY............................................................................................................3
1.0 BACKGROUND AND BUSINESS PROFILE............................................................................6
1.1 Business Description..............................................................................................................6
1.2 Company Locations, contact details and facilities................................................................7
1.3 Tree Nursery operational activities.....................................................................................8
1.4 Company Vision:...................................................................................................................8
1.5 Mission:................................................................................................................................8
1.6 Company Objectives:.............................................................................................................8
1.7 Purpose of the Plan...............................................................................................................9
1.8 Business Concept..................................................................................................................9
1.9 Critical Success Factors for MAT(U) Tree Nursery..................................................................10
2.0 MARKETING........................................................................................................................11
2.1 Market Analysis...................................................................................................................11
2.2 Target Market and customers...............................................................................................11
2.3 Competitive analysis and advantage....................................................................................11
2.4 SWOT analysis....................................................................................................................12
3.0 ORGANIZATIONAL AND HUMAN RESOURCE PLAN..........................................................19
3.1 Introduction:.......................................................................................................................19
3.2 Roles and responsibilities.................................................................................................19
3.3 Remuneration of personnel..............................................................................................22
3.4 Recruitment....................................................................................................................23
3.5 Training and staff development........................................................................................23
4. FINANCIAL ASPECTS/PLAN................................................................................................24
4.0 Introduction....................................................................................................................24
4.1 Important Assumptions:..................................................................................................24
4.2 Investment Plan..................................................................................................................25
4.3 Projected Cash Flow (Shs )..............................................................................................25
4.2 Projected Profit and Loss (SHS)........................................................................................27
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0 EXECUTIVE SUMMARY
0.1 Introduction
Mulozi Central Tree Nursery Co Ltd is a legally registered limited c ompany and
managed by boards of directors. It’s located in Pagwari West, Acoro Parish,
Pader town council in Pader district. It was started in 2015 December and got
registered in 2018. Its main activities are raising, managing and
distributing/selling tree seedlings. It raises 9 species of both wood and fruit
trees. The funds for starting the project was saved from my employment as
bicycle repairer and it was 480,000= in a rented piece of land but later
purchased our own where the project currently sits.
Business Concept
The Company strategy to expand a well-managed profitable tree nursery and
become a leading supplier of a variety of seedlings. The project goal is to This will
be achieved through expanding the supply and distribution to the local
community but also through getting distribution contracts with government and
civil society institutions such as National Forestry Authority (NFA). It intends to
roll out extension services to farmers to practice agroforestry by buying more
trees from the company and plant it as one of the climate change measure.
0.2 Marketing
The market for tree seedlings has increased due to government intervention
through encouraging a forestation in the country. There is a new development
in the sector where people with large extracts of land are investing in planting
trees as a long time investment. There are also skilled personnel for developers
to plant trees at their sites. The market demand for the tree seedlings of
Eucalyptus grandis, Pinus Caribeae and Grevellia robusta for wood is estimated
3
to increase from 38% in 2010 to 47% by 2030 at the national level (NFA,
2011).This has alerted the Government through National Forestry Authority and District
Forestry Services to advocate for tree planting thus creating market for the tree seedlings.
The market coverage will be in Pader district and the neighboring areas of
Agago Kitgum, Otuke, Gulu and Lira districts.
The target customers are NGOs that supports the communities through tree
planting and beekeeping, District forest service’s that plants on the Government
land but managed by community, commercial tree planters like companies and
other pattern ships, individual farmers who are engaged in tree planting,
institutions which are churches and schools in and outside Pader District.
0.3 Management
The managing Director is the overall personnel at the business. The managing
director has over 10 years’ experience in operating nursery beds and he gives
direction to the business. He works with the team of specialized capabilities in
finance and marketing and through the assistant manager, the casual personnel
are managed by the director. Performance targets are set by the director for
each office and through reporting and their supervision.
0.4 Financials
The project requires an investment outlay of Shs 70,000,000 to expand Mulozi
central Tree Nursery Co. Ltd. Management of Mulozi central Tree Nursery Co.
Ltd have saved SHS 30,000,000 for this proposed expansion of the business and
they will require a loan facility of Shs 40,000,000 from a financial institution to
effectively implement the project. With this kind of investment the project Profit
and Loss account is presented in the table below:-
Year End Year 1 Year 2 Year 3 Year 4 Year 5
4
Account Type Current Projected Projected Projected Projected
Sales 151,000,00 165,000,00 185,610,00 207,671,00 231,438,10
0 0 0 0 0
9,150,000 9,882,000 10,672,560 11,526,365 12,448,474
Cost of Sales
Gross Margin
94% 94% 94% 94% 95%
%
141,850,00 155,118,00 174,937,44 196,144,63 218,989,62
Gross profit 0 0 0 5 6
Operating 106,735,39 115,274,23
84,730,000 91,508,400 98,829,072
Expenses 8 0
Profit Before 103,715,39
57,120,000 63,609,600 76,108,368 89,409,237
Tax 6
Corporation
17,136,000 19,082,880 22,832,510 26,822,771 31,114,619
Tax 30%
Net Profit after
39,984,000 44,526,720 53,275,858 62,586,466 72,600,777
Tax
Net Margin % 26% 27% 29% 30.14% 31.37%
1 0.1 Introduction
2 Mulozi Central Tree Nursery Co Ltd is a legally registered limited company
and managed by boards of directors. It’s located in Pagwari West, Acoro
Parish, Pader town council in Pader district. It was started in 2015 December
and got registered in 2018. Its main activities are raising, managing and
distributing/selling tree seedlings. It raises 9 species of both wood and fruit
trees. The funds for starting the project was saved from my employment as
bicycle repairer and it was 480,000= in a rented piece of land but later
purchased our own where the project currently sits.
5
3 I as Ojok Mulozi had passion for planting trees but couldn’t afford the
expensive seedlings then and opted to attend short courses in raising tree
seedlings to have my own production. It took me four years to stabilize in
the production process as I attended many short courses
4
4.2 Company Locations, contact details and facilities
The business is located in Lwala Village Parwech Parish, Puranga Town Council,
and Pader District. The Business can be accessed through telephone
0782682785, 0760340788.
1.5 Mission:
To improve the quality of life of the target population through effective private
forestry assistance for socio-economic and ecological benefits.
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a) To promote commercial supply of quality tree seedlings and other planting
materials;
b) To support and demonstrate agroforestry practices and sustainable land
management.
c) To promote apiculture agroforestry system and marketing of apiculture
products
d) To promote coffee , cocoa, banana agroforestry tree seedlings
e) To promote commercial production and supply of citrus, mangoes,
Jackfruits , pawpaw and other tree seedlings
f) To promote renewable energy farming technology and knowledge
transfer.
The following are the purposes for the business plan to Mulozi central Tree
Nursery Co. Ltd.
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• It is a marketing tool for the business.
• It helps in general management of the business.
Sell products of the highest quality with excellent customer service and
support.
Satisfying the local demand before venturing into regional and national
markets.
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Strong team (management, operational and technical) to implement the
business plan.
Working capital investment to expand the business.
2.0 MARKETING
2.1 Market Analysis
The market for tree seedlings has increased due to government intervention
through encouraging a forestation in the country. There is a new development
in the sector where people with large extracts of land are investing in planting
trees as a long time investment. There are also skilled personnel for developers
to plant trees at their sites. The market demand for the tree seedlings of
Eucalyptus grandis, Pinus Caribeae and Grevellia robusta for wood is estimated
to increase from 38% in 2010 to 47% by 2030 at the national level (NFA,
2011).This has alerted the Government through National Forestry Authority and District
Forestry Services to advocate for tree planting thus creating market for the tree seedlings
2.2 Target Market and customers
The market coverage will be in Pader district and the neighboring areas of
Agago Kitgum, Otuke, Gulu and Lira districts.
9
The target customers are NGOs that supports the communities through tree
planting and beekeeping, District forest service’s that plants on the Government
land but managed by community, commercial tree planters like companies and
other pattern ships, individual farmers who are engaged in tree planting,
institutions which are churches and schools in and outside Pader District.
2.3 Competitive analysis and advantage
Mulozi central Tree Nursery Co. Ltd will provide competitive pricing for its
products, and will guarantee to match competitors’ prices, but exceptional
customer service and product knowledge will make the business stand out to its
target markets. The size of our inventory and the variety of choices our
customers will have when choosing tree seedlings will make Mulozi central Tree
Nursery Co. Ltd an attractive choice.
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Availability of well qualified and Using the skills and expertise to
experienced forestry staff. produce high quality seedlings.
Strategic Location. The business is near Use the strategic location to market
the main road for easy transportation the company products.
of seedlings.
A variety of tree seedlings species Using various tree seedlings species to
capture a large market.
Availability of cheap casual workers for Use to minimize labour costs
tree nursery operations
Good partnership of other tree nursery Use this cooperation to expand market
operations in Lira and Gulu. of the company seedlings.
Availability of assorts tools and Use the tools to produce timely and
equipment quality products.
In adequate fund to produce all the Source for funds from financial
tree seedlings being demanded. institutions and other development
partners
Good support and political will from the Use the support to increase production
local and district Team. The Centre is
being supported to establish solar
water irrigation for tree nursery.
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Contractual engagement with LM Increase production and supply of tree
international and INCU seedlings to generate more capital for
operational costs.
There is very high demand for tree Increase production and expand the
seedlings by individuals and market coverage.
Institutions
Dry spelt due to climate change can Expand solar water pumping facility
affect tree seedling production
Also:
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a) Market Information
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ii) Sign post at the nursery site: Another market strategy is the use of a Sign
post at the nursery site with a well labeled logo showing quality tree
seedlings.
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viii) Have our business website developed and post the products we offer and
how we operate the distribution
B) Pricing strategies
We will consider prices that are slightly lower compared to our competitors
and affordable to our clients. However this implies that we will have to
minimize our cost of production.
The business will also let the forces of demand and supply also come into
play as a way of determining prices of our products. These dictate that
when demand increases for a certain product, it is most likely lead to an
increase in the price of that specific product and if the supply of a given
product increases, it will most likely lead to fall in prices of that specific
product.
At some point in time, our prices will entirely depend on the economic
situation prevailing in the country. We will not continue pricing our
products at a lower rate when cases of inflation come in. This may mean
losses for our business
c) Sales Strategy
Sales strategy factors that influence primary sales include:-
In order for the sales strategy to be successful, the right profile of sales staff
have to be recruited to deliver on targets and maintain client relations.
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The key responsibilities of the Sales Team are to:
In enhancing customer prelateship, Mulozi central Tree Nursery Co. Ltd must
do the following:-
a) Should meet frequently and talk to customers and find out what they like
and dislike about each product;
b) Should develop customer-orientated attitudes, so that the customers feel
valued when the Company is dealing with them;
c) Make sure that all actions taken by staff reinforce the idea that the customer
comes first;
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d) Be very kind to customers (this includes using respectful language);
e) Give tokens to big customers (i.e. discounts and offer basic courtesies).
3.1 Introduction:
Managing a tree nursery business means having full control over what is
happening in the business. It involves aspects such as planning, budgeting,
purchasing, production and processing, marketing, finances and managing the
staff who work in the business. The Company has just developed financial and
accounting procedure manual; human resources Manual and policies and
systems, these will be fully followed to guide the operations of the business.
Director
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Assistant Director
Casual labors
Cashiers
The Director
The managing Director is the overall personnel at the business. The managing
director has over 10 years’ experience in operating nursery beds and he gives
direction to the business. He works with the team of specialized capabilities in
finance and marketing and through the assistant manager, the casual personnel
are managed by the director. Performance targets are set by the director for
each office and through reporting and their supervision.
To be the top executive for the Enterprise and implement the Board’s
decisions and policies on the day to day basis;
Ensure effectiveness in management by recruiting, orienting, training,
disciplining managers, communicating values, strategies and objectives,
assigning accountabilities, planning, monitoring and appraising job results,
developing incentives, developing a good environment for information and
opinions sharing.
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Leading the development and implementation of the overall organization
strategy and working closely with the management team members to
ensure an integrated approach to business operations and growth;.
To represent the management on the board; and continuously work
with the Board to create the platform of pro-active approach of
governance and ensuring a success transformation of the Enterprise;
To co-ordinate and supervise the company’s annual budget
preparation process and implementation and give direction for the
business
To raise investment and working capital financing
To set targets for the Enterprise and ensure that they are met;
Fix prices and sign business deals
Handle external business communications and public relations.
Responsible for signing Checks and documents on behalf of the enterprise
Evaluate the success of the enterprise
Other job portfolio functions and roles will be defined later.
Finance officer
Coordinating the financial aspects of a company.
Managing budgets.
Forecasting future cash flows and expenditures.
Providing input related to funding requests or strategic decisions about
mergers and acquisitions.
Advising an organization on how to increase profit through prudent financial
practices.
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Monitoring and enforcing compliance with finance-related laws, procedures
and regulations such as tax filing and financial reporting.
Planning, organizing, and executing financial tasks and projects of the
organization.
Marketing officers
Promoting businesses, services, products
Developing marketing and pricing strategies
Generating new business leads
Managing marketing budgets
Analyzing trends
Collaborating, managing and coordinating marketing processes.
Conducting market research to identify current trends of products and
services
Casual laborers
Watering the nursery beds
Packaging the seedlings
Weeding out any unwanted weeds from the nursery beds
Fetching water from the nearby water sources
Staff gains satisfaction from their jobs if they receive reasonable pay and have
good working conditions, together with management methods that motivate
them so that they enjoy their work. Well motivated staffs have limitless potential
in their individual jobs, and improve the overall productivity of the enterprise.
Mulozi central Tree Nursery Co. Ltd ) should therefore devise ways of
motivating staff and improving job performance. We propose for the following:
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a) Competitive salaries and regular review of salaries prompt pay and extra
rewards when the business does well
b) Paid overtime, leave and holidays.
c) Interest-free and flexible loan facilities for school fees and other family
needs.
d) Free meals, lunch allowance or food allowance.
e) Staff discounts for products.
f) Transportation to work or transport allowance
g) Uniforms, aprons, head scarves and work clothes.
Even the lowest paid worker needs a sense of security, recognition and
belonging. The Directors and managers should give workers contracts of
employment and encourage a sense of status and pride at all levels to help
employees identify themselves with the enterprise.
3.4 Recruitment
The proprietors together with the management will be responsible for the
recruitment of employees. Recruitment will be based on the educational
qualifications, experience in some Tree nursery management and operations
and business development skills.
We will have training programmes for our staff once a year for the various
departments such as marketing and sales, procurement and supplies, human
resource, financial and accounts manager and production and operations. Each
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of these will have a week’s training programme once in a year. We will also
sponsor some of the outstanding employees to some summits to expand their
knowledge and develop their skills. This will help them to develop in their fields
and sharpen their skills. Top management will be exposed to the latest
corporate management practices and principles and keep abreast the fast
changing market. Specifically, the Managing Director and the assistant manager
will attend these trainings.
4. FINANCIAL ASPECTS/PLAN
4.0 Introduction
Mulozi central Tree Nursery Co. Ltd needs financing to implement the Business
expansion requirements. We examine the financial aspects of the project in
details. The relevant tables, schedules, supporting statements, assumptions and
silent features and supporting data are presented herein.
The total project cost expansion for the five year is estimated to be Shs 70,
00,000 the directors’ contribution is estimated at Shs 30,000,000. The sponsors
require a long term loan Shs 40,000,000 to implement the project.
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4.1 Important Assumptions:
The four major assumptions used in the financial projection are:
Source of Funding
It is proposed that Shs 40,500,000 of the above investment costs will be
financed by the promoters of the business and Shs 350, 000,000 by loan and
short-term overdraft.
Total 70,000,000
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4.3 Projected Cash Flow (Shs )
Projected cash flow for the project appears in the table below
Cash outflow/expenditure
Production
39,600,000 42,768,000 46,189,440 49,884,595 53,875,363
costs
Operational
6,120,000 6,609,600 7,138,368 7,709,437 8,326,192
costs
Salaries and
9,420,000
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wages 10,173,600 10,987,488 11,866,487 12,815,806
Transport
3,600,000 3,888,000 4,199,040 4,534,963 4,897,760
costs
Mulozi central Tree Nursery Co. Ltd will have a positive cash flow right from
year 1 of expansion of operation. With the proposed cash inflow in form of
equity and long term loans, it will be able to meet all its cash outflows in form of
capital items and have a comfortable working capital position
4.2 Projected Profit and Loss (SHS)
Since the project has been on for some time it will continue to generate revenue
in 1st year of business plan implementation. In the 1 st year of business plan
implementation the business shall realize net profit equivalent to Ugx
39,984,000. The situation of profit making is maintained for the rest of the
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projected time frame and the end of year 5 the investment shall be in
accumulative profit figure of UGX 272,973,821 as indicated in table below
Table Projected Profit and Loss (SHS)
Gross Margin
94% 94% 94% 94% 95%
%
Corporation
17,136,000 19,082,880 22,832,510 26,822,771 31,114,619
Tax
26