Bon Munchies

Business Plan
Providing healthy cookies

Contact Information

May 23, 2021

1
Table of Contents
Introductory Page..................................................................................4
Company Overview...........................................................................4
Nature of the Business.......................................................................6
Statement of Financing Needed.........................................................6
Bon Munchies Confidentiality Agreement........................................7
Opportunity...........................................................................................8
Problem & Solution...........................................................................8
Executive Summary..............................................................................9
Milestones & Metrics.......................................................................10
Sustainability & Impact...................................................................11
Industry Analysis................................................................................12
External Analysis.............................................................................12
Analysis of Competitors..................................................................13
Market Segmentation.......................................................................14
Porters Five Forces...........................................................................15
Description of Venture.......................................................................16
Company Statements........................................................................16
About Bon Munchies.......................................................................16
Production Plan...................................................................................17
Equipment and Tools.......................................................................17
Production Process...........................................................................17
Operations Plan...................................................................................18
Production........................................................................................18
Operations........................................................................................18
Marketing Plan....................................................................................19
Marketing Strategy...........................................................................19

2
 Marketing Mix.................................................................................20
Organizational Plan.............................................................................21
Form of Ownership..........................................................................21
Management Team...........................................................................21
Job Descriptions...............................................................................21
Assessment of Risk.............................................................................21
Potential Risks..................................................................................21
SWOT Analysis...............................................................................23
Financial Plan.....................................................................................24
Forecast............................................................................................24
Financing..........................................................................................24
Statements...........................................................................................25
Income Statement.............................................................................25
Balance Sheet...................................................................................26
Cash Flow Statement.......................................................................27
Appendix.............................................................................................28

3
Company Overview
Ownership and structure

4
Nature of the business
Bon Munchies is a new organic bakery specializing in oat and barley cookies. Within the last
2 years there has been significant increases in demand for this kind of bakery products. This
can be explained to a large degree by the fact that until recently many Ethiopians have had
diabetes, and blood pressure and other diseases mostly related with the elder society. What
was once a huge problem that affected so many people with no recourse have become a
manageable ailment that is easily dealt with through modification of diets. This is very
positive for both those people that are affected as well as bakeries such as Bon munchies that
specialize in these products.

Statement of Financing Needed

Start-up requirements

1. Start-up operating expenses of 997,116 Birr. This shows up as negative retained

earnings in the initial balance because they are incurred before launch.
2. Starting cash in the bank of 1,426,283.67 Birr. (in initial balance)
3. Other current assets of 1,451,370.92.25 Birr (in initial balance)
4. Long-term assets of 286,722.68 Birr (in initial balance)

Funding

1. 512,000 Birr initial investment from bank (Shows up in initial balance as Paid-in
Capital.)

5
 Bon Munchies Confidentiality Agreement

The undersigned reader of Bon Munchies Business Plan hereby acknowledges that the
information provided is completely confidential and therefore the reader agrees not to disclose
anything found in the business plan without the express written consent of Ms. Abigiya Sem.

It is also acknowledged by the reader that the information to be furnished in this business plan
is in all aspects confidential in nature, other than information that is in the public domain
through other means and that any disclosure or use of the same by the reader may cause
serious harm and or damage to Bon Munchies.

Upon request this business plan document will be immediately returned to Ms. Abigiya Sem.
This is a business plan. It does not imply an offer of any securities.

Applicable Law

This contract shall be governed by the laws of the County of in the capital city of
and any applicable Federal law.

Signature

Printed Name

6
Opportunity

Problem & Solution

Problem worth Solving

Snacks play a very important role in the daily life of a person with diabetes. They are
essential to keep blood glucose levels as close to normal as possible and help in preventing
low blood sugar, hypoglycaemia. Snacks could also be consumed as a substitute for a regular
meal so as to not skip or go on our days on an empty stomach. For diabetes, eating regularly
healthy balanced meals plays an important role in stabilizing their blood sugars. Delaying or
skipping a meal would lead to blood sugar drop.
Snacks and cookies that are currently manufactured in Ethiopia all contain added sugars and
refined carbohydrate making them not good for diabetic people as they have a high glycaemic
index that causes repeated spikes in the blood glucose which increases the risk of developing
a cardiovascular disease. Varieties of snacks are available but the problem lies in their
healthiness. The snacks available in the market are for non-diabetic people leaving the
diabetic people with no choice but either to skip a meal or eat unhealthy snacks that is not
good for their blood sugar level. During the times when diabetic people cannot consume or
eat a regular meal, that is when they prefer snacking, as there isn’t much choice available to
them, they refrain from consuming the snacks. Thus, there is a gap in availability of diabetic-
friendly snacks in Ethiopia limiting the choices they have regarding having healthy munchies.

Our Solution
We bake cookies made specifically for diabetic people that they can use as a snack. Having a
diabetic-friendly cookie as an option means they can grab while feeling hungry during work,
on the road or even while hanging out with friends, families and during parties which enables
them to eat cookies freely without worrying about rise in glucose level in their blood thus,
lessening the gap in availability of snacks for diabetic people.
When they are hungry or want to eat a snack instead of skipping their meals or instead of
eating unhealthy snack a healthier alternative will be available in the market.
The ingredients we use for preparing the cookies are those that are advisable for diabetic
people or more specifically ingredients that have a low glycaemic index.
Snacks for a purpose, snack at certain times to keep from having low blood sugar. And
snacks for enjoyment, having diabetes does not mean that they must stop eating snacks. It
does mean that they should know what a snack does to the blood sugar. They need to choose
a snack that will not raise their blood sugar. BON munchies is the healthier choice as a snack
that is diabetic-friendly. Diabetic people will have a substitute for snacks available in the
market. The cookie we will be making is also edible for non-diabetic people which will be a
healthier snack choice for the people who want to enjoy while caring for their health.

7
Executive Summary

Introduction
Bon munchies is limited partnership liability. It was formed in Ginbot, 2013. This form of
ownership is because Bon munchies is a business with multiple owners to draw resources and
use different expertise. The business will be located in CMC, Addis Ababa which is the
capital city of Ethiopia. The plan of bon munchies is to attain and target customers with a
certain lifestyle. The product targets majority of the people with diabetes, health-conscious
consumers and in the long run super markets and cafes that plan to integrate healthy goods in
their supply.

The product
Bon Munchies will produce diabetic-friendly cookies that can fit customer healthy lifestyle.
The cookie will be mainly made from barley and oats purchased from agro-industries and
peanut butter will be added for sweetening purpose. It comes with an eco-friendly package
kaki each pack will contain a diet plan pamphlet for diabetic people. The cookie comes in 2
sizes small and large size small size containing 6pcs and large (family size) containing 15pcs.

Suppliers
Bon munchies emphasizes quality food and locally grown fresh products. Because of this, we
carefully select our supplies. We will set up wholesale relationships with a variety of local
suppliers for raw materials like Sunflower Oil, Baking Powder, Peanut and Kaki paper. For
our cereal raw materials like barley and oat (which also include grinding them), we have
planned to work on contract base with one agro-industrial Park that is involved in cereal
production. We will have food supplies delivered to our production place.

Production

As a startup, to minimize our cost, we limit our production and sale to one place. There are
three main tasks that will occur in the kitchen:

(1) Preparing dough

(2) Baking the cookies and

(3) Packing

In the retail as well, there will be three tasks:

(1) Marketing

(2) Displaying and Customer service

(3) Customer service.

8
 Objectives
 The company will make a healthy profit for its owners and provide a rewarding work
environment for its employees
 We also maintain a friendly, fair, and creative work environment, which respects
diversity, new ideas, and hard work.
 To be a valued cookie brand in the country and abroad

Key Success factors for bon munchies

1. Good location

2. Provides the highest quality products

3. Competitive pricing

Milestones & Metrics for a year

Milestones Due Date

Finishing marketing activities list Gibot 30, 2013

Analysing budget plan Sene 30, 2013

Campaign events Hamele 30, 2013

Building brand awareness Nehase 30, 2013

Analysing marketing attribution Meskrem 30, 2013

Key Metrics

Performance metrics

 Sales, expenses, and cash flow as in the plan.

 1 significant planned promotion advertisement per quarter.

 Participating in at least 4 awareness and cookie campaigns per year.

 Customer Loyalty

9
Sustainability and Impact
We will align with our company’s goals, missions, values customer expectation and growing
opportunities to make our business sustainable. Mainly, our business has almost no effect on
the environment as we planned to use compostable packaging material and proper wastage
disposal. Our production targets local customers in the short run with affordable price and
export to Sub Saharan African countries in the long run.

10
 Environmental and Industrial Analysis
External Analysis-PEST
Political
-Very low political stability: Results in fear of
investing in the country and hampers enterprises
innovativeness
-Unfair past elections: People lost trust
consequently there is doubtfulness of the coming
election (2021)
-High level of corruption: Resulted deep rooted
underdevelopment and poverty
- Business registration and licensing: A number of
measures have been implemented to ease the
process of starting a new business in Ethiopia
- Tax law: Tax on Income for business has
increased from ETB1,800 to ETB7,200.
- Competition Regulation: Introduced in 2014 to
protect the business community from anti-
competitive and unfair market practices and
also consumers from misleading market
conducts.
Social
-High population growth: Annual population
growth rate of 2.5%. 55.8% was between 15
and 65 years of age (2019). Key for targeting
our market.
-Consumers’ preference: Choose healthy food
products
-Culture of consumption: The society usually
prefer staple foods
11
Economic
-Fast economic growth: Impact on poverty reduction
-Lower-middle income status by 2025: Impact on
better living standard
- The COVID-19 pandemic: Has substantially
affected firms’ operations. GDP slowed down to
6.1%. It is unfavourable for new entrants.
-High inflation: Main reasons are increasing
bargaining power of farmers and monetary
expansion.
- Profit potential: Except some industries, there is low
profitability and productivity in the market
-Raw material: Ethiopia is the second largest barley
producer in Africa
-Industrial parks: 17 agro-industrial growth corridors
are planned for development; 4 Integrated Agro-
Industrial Parks (IAIP) are under construction
Technological
-Low access to internet: Less than 15% of its
population have access to internet relatively with low
connectivity. It is expensive and unreliable.
-Expansion: Ethio Telecom is attempting a broad
expansion of access throughout the country.
-Innovation: Enterprise innovation has increased.
- Equipment availability: Latest equipment are
imported from abroad. Their selling price is high.
Competition

The domestic production of biscuits and cookies in Ethiopia in the last fiscal year
(2019/2020) reached an estimated 193,773tn, according to data from the Central Statistical
Agency. In the same year the nation imported 1,762tn of biscuits, according to the Ministry
of Revenues. This indicates there is always higher demand than supply. Besides, there are no
manufactured cookies or biscuits for diabetic patients in Ethiopia so far.
The following cookie brands are indirect competitors of our product. The competition will be
if and only they are imported from abroad.
1. QUEST Nutrition Chocolate chip
2. VOORTMAN sugar free chocolate
3. Simple mills almond flour chocolate chip cookies
4. Gullon sugar free Choco chip Biscuits

Types of cookies ounce pack Price ($)

Gullon 4.4 4 18

Simple mills 5.5 3 25.33

QUEST 2.1 12 18.39

VOORTMAN 8 2 15

BAR MUNCHIES 2.1 6 .325

Conversion: 1 ounce=28.349523g
BAR MUNCHIES Ingredients composition
Carbohydrates 4.5g Cholesterol 0g
Sugar 0g Sodium 14.3g
Fat 0.8g Potassium 25.3
Protein 0.9g Iron 1.4%

Competitive advantage
BAR MUNCHIES enjoys several advantages over its competitors. These advantages include:
*Location: the only manufactured cookies for diabetics’ patients in Ethiopia.
*100% organic, low carbs, no sugar, low calories and fats
*There is high demand from both healthy and diabetics patients.
*Good relationship: we know the culture and how things go in offices.

12
Target Market
Market Size & Segments

We chose to target customers with a certain lifestyle. The product targets majority of the
people with diabetes, health-conscious consumers and also super markets and cafes that plan
to integrate healthy goods in their supply.

Product: Diabetic-friendly cookies implement and information on cookies that can fit
customer healthy lifestyle. It comes with an eco-friendly package containing a diet plan
pamphlet for diabetic people. The cookie comes in 2 sizes small and large size small size
containing 6pcs and large (family size) containing 15pcs. [Nutrient and mass specification
per package and cookie]
Age Group- 25-79 is the age range where diabetes is prevalent. We would be targeting
mainly consumers aged 25 to 60.
 Age group 1 (25-40) - will be targeted through social media promotion.
 Age group 2 (40-60) - Direct promotion and television promotion.

Hobbies and Lifestyle preference

 Consumers following a certain diet plan due to diabetes.
 Customers with a healthy lifestyle choice.

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Porters Five Forces

RIVALRY AMONG EXISTING THREAT OF NEW ENTRANTS:

COMPETITORS:
 Government Policies: Has
 Number of competitors: THREAT OF NEW shown substantial reform
There are some biscuit ENTRANTS  Access to Distribution of
manufacturers in channels: All snack products
Ethiopia aren’t easily accessible.
 Industry Concentration:  Capital Requirements:
Intermediate Depends on the size of the
 Industry Growth: Shows industry; relatively medium
high trend  Brand Loyalty: Is high for
snacks

BARAGAINIG POWER OF SUPPLIERS

RIVALRY AMONG EXISTING COMPETITORS

BARGAINING PWER OF BUYERS

BARAGINING POWER OF SUPPLIERS  Forw acts between

ard suppliers and
 Number of suppliers integ Bon
relative to buyers: Is 1
ratio Munchies.
relatively high and is n: Otherwise, the
characterized with From forward
5 high competition suppl integration is
 Switching cost: Many iers is low.
suppliers in the snack- neede
food industry. Because the d for
product they provide are packa
standardized and less ging
differentiated hence, with purpo
low switching costs ses
 Availability of Suppliers whic
for immediate h can
purchases: Many be
suppliers are available in solve
the market. This makes it d
easier for snack-food throu
manufacture to switch gh
suppliers. contr
  Switching Costs: Is
BARAGINING POWER OF medium because

THREAT OF SUBSTITUTE PRODUCTS: THTREAT OF SUBSTITUTE PRODUCTS

BUYERS: customers taste differs

 Number of substitute products available:
Manufacture of bakery products public - 2  Buyer’s
private - 194 total - 196 power: The
 Relative price performance of substitute: buyers have
3.8 (350 gram) strong
 Product differentiation bargaining
– taste and price power and they
usually tend to
drive price
down thus
limiting the
potential of the
Ethiopian
Ethiopia to earn
sustainable
profits. But in
the biscuit
industry, it
unlikely occurs
 Buyers
information
availability:
Most of food
products are
advertised
through
television or
radio. Thus,
buyers
somehow have
access to
information
but when
buying,
usually, buyers
don’t have the
culture of
reading
information
available on
packages.
Description of the venture
Our mission
Bon Munchies is dedicated to recognize diabetic patients needs by producing sugar free, low
carbs, low fats, superior quality, and all-natural snacks
Tagline:
“Healthy cookies do exist”
Our Vision
Bar Munchies strives to inspire healthier communities by providing healthy cookies for
diabetic and non-diabetic people.
Our Value
 We are always striving to provide excellent quality products
 We value honesty, integrity and professionalism
 We are always acting sustainably

Our objectives
The company will make a healthy profit for its owners and provide a rewarding
work environment for its employees
We also maintain a friendly, fair, and creative work environment, which respects
diversity, new ideas, and hard work.
To be a valued cookie brand in the country and abroad in the future

Bon Munchies
Bon Munches has chosen a limited liability partnership as its formal legal entity. It will first
start out as a bakery and will directly sell the product to consumers in Addis Ababa. The
partners of the business will also act as managers with specific roles assigned.
The business will be located in a business centre building in CMC, Addis Ababa. The site
will consist of display room, kitchen, office and bathroom. The rent is 300,000 birr per year.
The kitchen will be equipped with baking oven, flour mixer and refrigerator. The packaging
materials will also be in the kitchen. The office area will be equipped with a table, chairs and
computers. The display room will contain display windows, trays for the packages and cash
register.
Bon Munchies will produce diabetic-friendly cookies that can fit customer healthy lifestyle.
The cookie will be mainly made from barley and oats purchased from agro-industries and
peanut butter will be added for sweetening purpose. It comes with an eco-friendly package
kaki each pack will contain a diet plan pamphlet for diabetic people. The cookie comes in 2
sizes small and large size small size containing 6pcs and large (family size) containing 15pcs.
The cookies will be directly sold to customers without the involvement of a middle person.
Hours of operation will be 2:30 AM to 11:30 PM for 6 days a week. The staff will include
manager, accountant and sales woman and control the business according to our role. The
management team will consist of 6 positions.

16
 Production plan

Equipment & Tools

The instruments that we will be using are mainly oven, mixer and baking machines. To assist
our production and operation process, we will also be using refrigerator, filling cabinet, and
computer accessories. We are also going to use other tools that will be used in the production
process by bakers.

Raw materials
Oat, Barely, baking powder, Sun-flower oil, water, and peanut are the raw materials in the
production process. These raw materials are available in the market.

Production process
Step 1: Preheat your oven to 325F (160°C) and line a baking tray with baking paper.
Step 2: Add in the bowl, water, baking powder, and grinded barley and oats . Stir until well- combined.
Step 3: Gently fold in the peanuts until they are evenly distributed throughout the dough.
Step 4: Using about 1 tbsp of dough at a time, form the dough into cookies and place on a baking tray lined wit
Step 5: Bake for 15-20 minutes at 325F (160°C) until they just start to brown and become
golden.
Step 6: Remove from the oven and allow to cool for 10 minutes on the baking tray.
Step 7: Gently transfer from the baking tray to a cooling rack and allow to cool for another 10 minutes.
We expect 5,000 pieces of cookies per day. 2,500 smaller size cookies and 2,500 family size cookies. This will

Packaging process
After the cookies has cooled for 30 minutes, it will be packed according to size (6 piece for
small size and 15 pieces for large size). Then a pamphlet about diabetic nutrition will be
included.

17
Operations plan
Hours of operation will be Monday to Saturday 2:30 LT – 11: 30 LT.

Production

As a startup, to minimize our cost, we limit our production and sale to one place. There are
three main tasks that will occur in the kitchen:

(4) Preparing dough

(5) Baking the cookies and

(6) Packing

In the retail as well, there will be three tasks:

(4) Marketing

(5) Displaying and

(6) Customer service.

There will be at most 10 people working on preparation of the cookies and some administrative
tasks to oversee the bakery.
No. Description No of persons

1 Bakers 2
2 Assistant 2
3 Sales man 1
4 Digital Marketer 1
5 Manager 1
6 Accountant 1
7 Guard 2

Locations & Facilities

Initially our focus will be in places where we could find lots of people in certain areas.
Condominium, apartments even crowd market places will be an ideal place for our bakery.
Total square footage needed is 500-700 square feet. The building that we need is one that is at
street level have a good visibility and easy walk-in access. But, as we grow, we will open as
many as possible branches and even export to other countries so we can increase our customer
reach and profit.

18
Technology

The machines (mixer and baking machines) that we will be using to produce are power
saving as possible. The packaging we will be using (kaki paper) is environmentally friendly
which can decompose easily.

Suppliers
Bon munchies emphasizes quality food and locally grown fresh products. Because of this, we
carefully select our supplies. We will set up wholesale relationships with a variety of local
suppliers for raw materials like Sunflower Oil, Baking Powder, Peanut and Kaki paper. For
our cereal raw materials like barley and oat (which also include grinding them), we have
planned to work on contract base with one agro-industrial Park that is involved in cereal
production.

We will have food supplies delivered to our production place.

Equipment & Tools

The instruments that we will be using are mainly mixer and baking machines one for each.
To assist our production process, we will also be using refrigerator, filling cabinet, furniture,
computer accessories like vat register machine one desktop printer and generator.

Marketing Plan
Marketing Strategy
The primary focus is to create loyal customers through personal attention and satisfaction to
meet first years' projected sales. Bon munchies seeks expansion into other markets and
distributions to increase first years' projected sales by 5%. Competitiveness will be
maintained by keeping costs at entry levels through competitive shopping and retaining
personnel. Bon munchies will maintain a competitive advantage by expanding the product
line to include cookie cakes, other dough types, lactose-free dough, and seasonal ingredients.
Bon Munchies will seek equipment options to increase operating efficiency to support added
sales.
Bon Munchies’ target market will be families with children, male and female adults.,
diabetics, dieters, and gluten-intolerant individuals with the interest of enjoying sweet treats
and stay healthy at the same time. The company will target businesses within a five-ten-
minute walk from the store's location and in the long run, driving distance within seven miles.
Bon Munchies will target businesses and groups in the Summit area by offering a delivery
service of cookies and sweets for meetings and functions. Internet ordering will be available
at the end of six month to target a wider range of customers.

Promotion Strategy
Bon Munchies will blanket neighbourhoods surrounding its locations with flyers and
brochures distributed at a local grocery stores and super markets. These pieces will provide
general information on the Bon Munchies, offer discounts, and/or provide other inducements
for people to frequent the store.
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Advertising
Bon Munchies will initially advertise in local newspapers and sponsor community events and
holiday’s where most of our target audiences are likely to gather in order to gain awareness. It will
also organize different social media challenges, for example, on tic tok to increase our products’
awareness and broaden the size of our target audiences.

Sampling
Bon Munchies will maintain a website and publish a monthly email newsletter to tell customers
about new events, products, and more

Ongoing Customer communication

Before opening the store, Bon Munchies will organize pre-opening events designed for
prospective customers, local merchants, and media persons. These events will create buzz
and awareness for Bon Munchies in the area. Bon Munchies will also engage with customers on
different social media platforms mainly on Telegram and Tic tok.

Marketing Mix
Product Price Place Promotion
Small size pack Price of 6 pieces Location: CMC, We prepare offline
which includes 6 small size pack: 13br Addis Ababa marketing
pieces and family Price of 15 pieces We produce and campaigns and
size pack with 15 family size wholesale our advertisement to
pieces Bar munchies pack:33br products Our promote our product
will be provided. targeted customers in the short term. In
The packaging are diabetes. the long run, we will
design is orange kaki establish digital
paper with stickers, marketing strategies.
tagline and
pamphlets.
People Performance Partners Principle
Our targeted Quarterly SWOT Our partners will be Our company aims
customers are analysis will be Ethiopian Diabetic in providing healthy
diabetes. Our applied. Association. We will snacks to customers.
product is also donate 10,000br per
available for non- year. Our mutual
diabetic people who benefit will lay on
want to consume providing important
healthy cookies information about
diabetes.

20
Organizational plan

Bon munchies is limited partnership liability. It was formed in Ginbot,2013. This form of
ownership is because Bon munchies is a business with multiple owners to draw resources and
use different expertise. Having the characteristics of limited liability allow us to be flexible.

Management Team

 CEO - Rediet Sisay

Experience: Finance and Risk Manager at AIESEC in SOC, Volunteered at Unilever
 COO – Abigiya Sem
Experience: Local Committee President at AIESEC in SOC, Junior Member at Share
growing a new generation of leaders, Volunteered at Unilever, Intern at AWIB
 Marketing and public relation – Arsema Gizachew
Experience: Customer service officer and social media manager at line Addis
consultancy, Volunteered at YWCA
 Finance manager- Ruth Mulugeta
Experience: Local Committee Vice President of Finance and Legalities at AIESEC in
SOC, Volunteered at Unilever, Currently volunteering at Ashagari youth
 BD manager- Meheret Habtamu
Experience: Member at Utiopia, Volunteered at SOS
 Sales manager – Shalom Habte
Experience: Student at alliance ethio-française, Volunteered at Unilever

Assessment of risk
Potential risks include
1. Financial Risks:
External financial risk - There is a frequent fluctuation in commodity price of food products
in Ethiopia particularly in Addis Ababa. When we say price fluctuations it also includes the
raw material ingredients to be used.
Effect on Bon Munchies
● It could lead to lower profit or loss
● It could damage the operational cash flow of the venture
● Net income of the venture will vary
Mitigation methods
● Develop a dedicated strategy for components that are subject to volatility
● Monitor pricing trends

21
 ● Manage inventory to soften impact of price changes e.g. stockpile
● Use financial and operational hedging
Internal financial risks- cash flow shortages and depreciation of assets are some of the
anticipated financial risks
Effect on Bon Munchies
● Due to cash flow shortage Bon Munchies may have to take additional loans or make
late payments for utilities, suppliers and debt.
● Poor cash flow erodes the competitive advantage of Bon Munchies
● Depreciation of asset might cause less output as it reduces the capacity of the
machineries
Mitigation methods
● Increase physical sales using several methods such as special discounts to increase
cash inflow
● Embrace cost-cutting measures to reduce the amount of cash outflows
● Insure the asset

2. Legal Risks: the possible risk that Bon Munchies may face include
 Non-compliance with regulations imposed by the authorities
 No Legal Protection for Intellectual Property Assets
Possible effect
● Noncompliance could lead to penalties or shutting down of Bon Munchies
● Copyright issues could lead to potential lengthy and costly
lawsuits Mitigation
● Register work via a copyright registration service
● Mark all work with a copyright notice, include in all footers etc
● Take prompt action on infringement
● Employee training and refresher courses
● Seek legal advice on contracts, new legislation, industry specific regulations

3. Operational Risks and/or Environmental Risk: the possible risks include

 Failure of utilities e.g., water, electricity
 Absenteeism from workers
 Machinery
Failure Effect on Bon
Munchies
● The risks could damage the production process on the venture
● Absenteeism could strain teamwork
Mitigations
● Keeping stock of parts
● Train employees on safe use, maintenance and basic repair
● Move location for more reliable supply
● Separate sick pay from annual leave so that it can be tracked
22
 ● Have a fit for purpose sickness absence policy

23
 4. Strategic Risks: the risk associated to this is the inability of Bon Munchies to
respond to market changes
Possible effects
● Loss of demand for the product
● Loss of strong customer base
● Lower market share
● Low competitive advantage
● Risk of failure of Bon Munchies
Mitigations
● Continuously review the market and technological advances
● Invest in Research and Development team as freelancers

Strength
● The management team is diverse
and has members with professional
experiences in different fields.
● A thorough market research has been
done.
● The management team has organized
board of advisors who are
professionals in different areas.
● High quality products using
local inputs
● Sustainable impact on the market
● Inputs used will have no impact on the
environment
● Packaging is environmentally friendly
● The management team is well
organized with specific roles
assigned
Opportunity
● Food specifically for diabetic people
is untapped market
● Ethiopia is the second largest barley
producer in Africa
● Consumption of healthy products has
shown an increase
● The size of the sector significant, its
growth trend reveals future
opportunities
Weakness
● Management team do not have an
experience in food manufacturing
● Venture will start as a high labour-
intensive process
● High cost of setting up operations
● Low beginning capital which limits
the capacity of the venture
Threat
● The market for food products in Addis
Ababa is generally unstable, as it is for
Ethiopia as a whole.
● Seasonality (varying from
harvest period to shortage)
● Most consumers of Ethiopia lack
knowledge about nutrition
● There is a political instability in
the country
● High corruption
● Some initiatives by the government
restrict the competitiveness of other
processors of fortified food

24
 Financial Plan
Forecast
According to our sell plan, we have planned to sell 167,616 packets pear year. We projected
our revenue based on our assumption that every daily production will be sold. Our long
term sales depend on the estimated revenue that our business generate.
Table

Forecast
Year 1 Year 2 Year 3 Year 4 Year 5
Revenue 3135168 156758.4 3291926.4 329193 3621119 543168 4164287 832857 4997144
Net Expense 997116 49855.8 1046971.8 104697 1151669 172750 1324419 264884 1589303
Income before tax 1171944 58597.2 1230541.2 123054 1353595 203039 1556635 311327 1867962
Net Income after tax 827360 41368 868728 86873 955600.8 143340 1098941 219788 1318729

Financial Highlights by year

Chart Title
4500000
4000000
3500000
3000000
2500000
2000000
1500000
1000000
500000
0
Year 2022 Year 2023 Year 2024 Year 2025
RevenueNet ExpenseNet Profit

Financing
Sources of fund
To start our business, we need 512,000br. for investment form bank.
It will only take Bon Munchies 7 years and 4 months to break even with a gross profit 69%

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Statements
Projected Income statement for Year 1
Bar Company
Income statement
For the Year Ended Sene 30,2014
Revenue Br 3,135,168.00
Less Cost of Goods Sold (9,661,108.00)
Gross Profit 2,169,060.00
Operating Expenses
Salaries and Wages expenses Br 456,000.00
Rent 300,000.00
Package 55,872.00
Labelling 27,936.00
Advertisement 40,000.00
PTT 18,000.00
Audit fee 15,000.00
Transportation 14,400.00
Fuel 12,852.00
Donation 10,000.00
Maintenance 6,000.00
Loading and Unloading 1440.00
Depreciation 34,816.00
Miscellaneous 4,800.00
Total Operating expenses 997,116.00
Income Before Tax 1,171,944.00
Add Donation 10,000.00
Taxable Income 1,181,944.00
Less 30% Profit tax 354,583.00
Net Income after tax Br 827,360.80

26
Projected Balance Sheet
Bar Company
Balance Sheet
For the Year Ended Sene 30,2014
Assets
Current Assets:
Cash Br 1,426,283.67
Inventory 20,127.25
Supplies 4960.00
Total Current Assets 1,451,370.92
Plant Asset:
Machinery 81,845.20
Furniture & fixture 62,550.00
Equipment 9,100.00
Generator 41,911.42
Computer & Accessories 60,000.00
Cash Register 6,685.80
Printer 6300.00
Refrigerator 12,980.36
Tools & other equipment 5,450.00
Total plant assets 286,722.68
Total Assets Br1,738,093.60
Liabilities
Income tax Payable 4960.00
Vat Payable 39189.60
Profit Tax Payable 354583.20
Total Liabilities 398,732.70
Owners Capital
Retained Earning 827,360.80
Capital 512,000.00
Total Retained Earnings and Owners 1,339,360.80
Capital
Total Liabilities and Owners Equity Br 1,738,093.60

27
Projected Cash Flow Statement

Bar Company
Statement of Cash Flows
For the Year Ended Sene 30,2014
Cash Flows from operating activities:
Cash received from customers Br 3,135,168.00
Deduct cash payments for expenses and 1,899,345.65
yments
Net cash flows from operating activities 1,235,822.35
Cash Flows from investing activities:
Fixed Assets (321,538.68)
Cash flow from financing activities:
Cash received as owner’s investment 512,000.00
Net cash flow and Dec 30,2022 cash bal. Br 1.426,283.67

28
 Appendix

Soethoudt, Riet V., Sertse , Groot.Food, (2012). Business Opportunities- Food Processing in
Ethiopia.

Ethiopia-Agro Processing https://www.trade.gov/knowledge-product/ethiopia-agroprocessing

https://www.investopedia.com/

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