Business Plan

PATRICIA’S BUSINESS PLAN
P.O BOX 300 ENDEBESS
TEL: 0748332499
Email: patriciambithi21@gmail.com
TITLE : BUSINESS PLAN
NAME OF PRESENTER PATRICIA MBITHI

:
ADM NO : AS-DAB/26927/21
INDEX :
5031112961
CENTRE NO : KITALE NATIONAL POLYTECHNIC
PRESENTED TO : KENYA NATIONAL EXAMINATION

COUNCIL
FOR THE AWARD OF DIPLOMA IN

APPLIED
BIOLOGY
SUPERVISOR : SARAH
CENTER NAME : KITALE NATIONAL POLYTECHNIC

CENTER NUMBER : 5032100
DATE PRESENTED : JULY, 2024 SERIES
i
DECLARATION
I Patricia Mbithi declare that this research report is my original work and has never been
submitted or presented to Kenya National Examination Council or any other institution for
any award.
Name : PATRICIA MBITHI
Signature :
Date :
Supervisor’s Name : MIS SARAH
Signature :
Date :
i
DEDICATION
I dedicate this business plan to my beloved mother, father, sisters and brothers and not
forgetting my friends for the good support they gave me in the entire process of my business
plan.
I say thanks and God bless all of you.
ii | P a g e
ACKNOWLEDGEMENT
First and foremost I thank the almighty God for his continued strength, knowledge and
wisdom to carry out this work. I dedicate my sincere gratitude to my supervisor Madam
Sarah for his kind advice and guidance in writing this business plan. I also extend my
heartfelt to my family members more so to my mother for her moral support through
completing this business plan.
Finally I cannot forget to appreciate my friends for their most moral support they accorded to
me as I was writing this business plan.
iii
Table of Contents
DECLARATION....................................................................................................................................i
ACKNOWLEDGEMENT....................................................................................................................iii
EXECUTIVE SUMMARY..................................................................................................................vii
1.0 BUSINESS DESCRIPTION......................................................................................................vii
1.2 MARKETING PLAN................................................................................................................vii
1.3 ORGANIZATIONAL PLAN.....................................................................................................vii
1.4 PRODUCTION PLAN...............................................................................................................vii
iii) ORDERS AND INQUIRY............................................................................................................viii
1.5 FINANCIAL PLAN..................................................................................................................viii
1.0 BUSINESS DESCRIPTION........................................................................................................1
1.1 BUSINESS NAME......................................................................................................................1
1.2 BUSINESS LOCATION AND ADDRESS.................................................................................1
2.0 2.1 FORMS OF BUSINESS OWNERSHIP...............................................................................2
2.2 TYPES OF BUSINESS...............................................................................................................2
2.3 PRODUCT AND SERVICES.....................................................................................................2
1.6 JUSTIFICATION OF THE OPPORTUNITY.............................................................................2
2.4 INDUSTRY.................................................................................................................................2
SHORT TERM GOALS........................................................................................................................3
LONG TERM GOALS..........................................................................................................................3
1.9 ENTRIES AND GROWTH STRATEGY...................................................................................3
CHAPTER TWO...................................................................................................................................4
3.0 MARKET PLAN 3.1 CUSTOMER.............................................................................................4
1) Kaptama Health Center.............................................................................................................4
2.2 .MARKET SHARE.....................................................................................................................5
2.3 COMPETITION..........................................................................................................................5
2.2 METHODS OF PROMOTION AND ADVERTISING..............................................................6
ADVERTISEMENT..............................................................................................................................6
PROMOTION METHOD.....................................................................................................................6
3.2 PRICING STRATEGY...............................................................................................................7
3.3 SALES TACTICS.......................................................................................................................7
2.4 DISTRIBUTION STRATEGY....................................................................................................7
CHAPTER THREE...............................................................................................................................8
iv
2.0 ORGANIZATIONAL PLAN 3.4 ORGANIZATIONAL STRUCTURE....................................8
3.5 MANAGERS AND QUALIFICATION......................................................................................8
3.6 PERSONNEL, NUMBER AND DUTIES...................................................................................9
2.7 RECRUITMENT, TRAINING AND PROMOTION..................................................................9
2.7 REMUNERATION AND INCENTIVE....................................................................................10
2.8 LICENSES, PERMITS AND BY-LAWS.................................................................................11
3.7 SUPPORT SERVICES..............................................................................................................11
CHAPTER FOUR...............................................................................................................................12
4.0 OPERATIONAL PLAN 4.1 PRODUCT OR SERVICE DESIGN AND DEVELOPMENT....12
4.2 PRODUCTION OR OPERATIONAL FACILITIES AND CAPACITY..................................12
4.3 PRODUCTION OR SERVICE STRATEGY............................................................................13
4.4 PRODUCTION PROCESS.......................................................................................................13
Step 1...........................................................................................................................................13
Step 2...........................................................................................................................................13
Step 4...........................................................................................................................................14
4.5 REGULATIONS AFFECTING OPERATIONS.......................................................................14
4.5 EQUIPMENT OR MATERIALS..............................................................................................14
CHAPTER FIVE 5..............................................................................................................................15
FINANCIAL PLAN............................................................................................................................15
5.4 PRE-OPERATIONAL COST....................................................................................................15
5.5 ESTIMATION OF WORKING CAPITAL...............................................................................15
2nd YEAR.....................................................................................................................................16
3rd YEAR.....................................................................................................................................16
5.6 PREPARATION OF CASH FLOW PROJECTS FOR YEAR 1...............................................18
YEAR 1...............................................................................................................................................22
5.9 TRADING, PROFIT AND LOSS ACCOUNT(PROFORMA INCOME).................................22
BALANCE SHEET YEAR 1..............................................................................................................25
5.8 BALANCE SHEET YEAR 3....................................................................................................26
5.7 BREAK EVEN POINT IN(UNIT)............................................................................................27
5.8 GROSS PROFIT RATIO...........................................................................................................28
5.9RETURN FINANCING.................................................................................................................29
v
5.9.1 PROPOSED CAPITALIZATION..........................................................................................29
vi
EXECUTIVE SUMMARY
1.0 BUSINESS DESCRIPTION
The business name will be PATRICIA’S AGROVET. It will be dealing with the selling of all
kinds of Animal feed like chick mash, layer mash and magadi. The business will be located
at Endebess high way with good infrastructure.
These factors will contribute to the growth of the business. Its goals are to provide high
quality services at all times.
1.2 MARKETING PLAN

The customers targeted by the business are individual customers and commercial customers.
Individual customers are those who buy for domestic purposes, they will buy off magadi and
chick mash.
The business will compete with other businesses of the same type. It will serve customers of
all ethnic and education level. Commercial customers will buy in small units. The business
will be selling magadi directly to customers through advertisement by the use of radio,
newspaper and orally in the business will involve cash payments.
1.3 ORGANIZATIONAL PLAN

The business form of ownership is a sole proprietorship business. The second post will be of
the supervisor, who will have some powers and authority. He will be assisting the manager
by representing him when he is out on business issues. Other personnel are cleaners, security
guards and drivers in the business which requires honest, faithful and responsibility staff. The
manager will advertise vacancies through posters for those who will be interviewed. The
payment of salary will be every end of the month. The business will have supportive and
advisory services for example insurance and transport.
1.4 PRODUCTION PLAN

The business will purchase its operational facilities that will be used to promote the
production of the business; the mode of the business will be assigned in such a way that it
will attract the customers by lowering the prices. The following steps will be followed; i)
DISCIPLINE
High standard of discipline has to be observed by the employees. ii)

SERVICE
The sole representative will be responsible for serving the customers.
vii
iii) ORDERS AND INQUIRY
The customers will make order for magadi. iv)
PAYMENTS
All payments will be made to accounts offices and receipts will be given in case of payments
by change, it will be deposited in the firms accounts. Credit facilities will only be offered to
non-persons institution, the accountant will be required to present his daily records to the
manager for verification and approval.
1.5 FINANCIAL PLAN

The business will have pre-operation cost of 20,000 with an aid in commencing of the
business working capital of the first year of the operation is estimated to be 15,000. A
total margin contribution of 200,000 and proposed capital of 100,000 the projected cash
flows can show a total of Kshs 300,000.
viii
CHAPTER ONE
1.0 BUSINESS DESCRIPTION

The business will aim at supplying medicine of all kind such as chick mash, layer mash, dairy
meal and magadi. All the medicine needed by the veterinary.
1.1 BUSINESS NAME

The business will be called PATRICIA’S AGROVET
P.O BOX 300, ENDEBESS
Its address will be patriciambithi21@gmail.com . The business will be called PATRICIA’S

because the name is unique and special according to the goods its going to offer. Also my
name will attract more people to come and buy medicine of all kinds.
1.2 BUSINESS LOCATION AND ADDRESS

The business will be located in TRANZOIA County, Ndivisi division of partly ENDEBESS.
On the second floor of the building room number 4. The reason for locating the business in
Endebess is that, the place is strategically located and it is at mid-market surrounded by many
people.
ENDEBESS
KITALE
WEBUYE
ELDORET
PATRICIA’S AGROVET
P. O. BOX 300, ENDEBESS.
TEL: 0748332499
Email: patriciambithi21@gmail.com
1
2.0 2.1 FORMS OF BUSINESS OWNERSHIP
The business will be newly started as a sole proprietorship. It will be owned by PATRICIA
MBITHI. The business will increase many people who will get employed and they will
increase their living standards.
2.2 TYPES OF BUSINESS

Be PATRICIA’S AGROVET will be a trading type of business which involve buying and
selling of medicine to customers. The business will serve as a small business with an aim of
expansion.
2.3 PRODUCT AND SERVICES

The products to be offered in agrovet will be dairy chick mash, layer mash and magadi. There
will be chick mash for chicks, and these will be given during birth. The medicine will be
supplied in bulky to veterinary by the manufacturers at a low price hence we will sell them at
a low price to customers. In order to improve the living standards of people in that area.
1.6 JUSTIFICATION OF THE OPPORTUNITY

The business will have an excellent opportunity due to supply of high product of high quality
to the customers. The area has device population which walks for long distances gaining to
buy goods from other hardware’s. This is after acquiring all the necessary documents to start
and keep the business going. The permission town is growing in information and technology.
The town has biggest border connected to Uganda and many people of different Nations are
staying within it. Due to this the increase in economic activities which goes hand in hand
with production and skills demand for advanced service which can only be offered at selling
magadi and broilers. Many people who are illegal business men who sell poor quality of
goods have the problems of disconnection. The town has better security and its environment
ensures there is safety for the business.
2.4 INDUSTRY
This will be a commercial kind of business. The room to be used will be big enough to allow
room for future expansion the proprietor will venture in buying accessories from suppliers
and sell to targeted customers. In its initial stages, the proprietor will work with high
technology to cope with the available competition. The manufacturing and service industry
2
goods are to be purchased in bank as a wholesale price and sold to customers. Medicine will
be under manufacturing industry. The materials will be obtained from PATRICIA’S
AGROVET where they are readily available for supplying medicine. The capital will be
10,000
1.8 GOALS OF THE BUSINESS
SHORT TERM GOALS

- The business aim on increasing the stock in order to remain in contact with customers.
- The business aims to employ people hence increase the employment opportunity to
many people.
LONG TERM GOALS

- The business aims to diversify its products to its customers, whereby there are plans
to start four branches near our customers.
- To maximize production with limited discount with the production. This will be done
by making sure that our customers incur few discounts.
1.9 ENTRIES AND GROWTH STRATEGY

Because of the increase in demand the business is expected to increase its sale volume by a
half of the original total sale after a period of two years of the operation.
The business has a plan to advertise its product for the customers to get information about the
shop and the product which is offered.
Arrangement has been made with some of our suppliers to provide after sale medicine and a
cash discount of 10% for every medicine bought on cash all this and others are expected to
boost the business operation.
3
CHAPTER TWO
3.0 MARKET PLAN 3.1 CUSTOMER
The business will gain at a high percentage of its customer from within and around the
business. The customers comprises of all classes of people such as the youth, teenage and all
who are relatively quality prospects. the estimated customers in relation to the business is set
up to serve each and every individual maximality where most of the population is within the
town.
1) Kaptama Health Center

Due to the fact there is no other nearest hospitals, the government has come up with an
idea of building of health center in this place. The road is not in good condition, the people
concerned decided to make a contract with me as their supplier. 2) Juakali
The level of income is to be determined by the quality of goods they purchase and quality and
kind or service to be offered according to the fact that the people concerned decided to make
a contract with me as their suppliers. The materials to be supplied includes; the mode of
payment ranges from the firm cheque for bulky and cash for rental traders.
4
2.2 .MARKET SHARE
10%
30%
40%
Rahab Enterprise
Emmanuel Enterprise
Reeves Enterprise
Kalvin Enterprises After 2 years

BUSINESS NAME POPULATION PERCENTAGE DEGREES
Lonah 1,000 20 78
Beryline 3,000 40 60
Reeves 4,000 20 25
Emmanuel 15,000 20 25
Rahab 7,000 10 25
Total 100 360
5
2.3 COMPETITION
PATRICIA’S AGROVET is expected to encounter still competition from its competitors
some of which are located around the enterprises and others some kilometers away from the
business premises the representation of the key, competitor their sizes, location, advantages
and weaknesses and low. PATRICIA’S AGROVET will be categorized on their weaknesses
which will be shown as follows in the table.
COMPETITORS SIZE LOCATION STRENGTH WEAKNESSES

Beeves poultry Large business Next to the Enjoys the Products are of
enterprise market economy of relative low
large scale quantity
production in
the market
Lonah Poultry 1st floor next to Along Malaba Committed to It is not in a
Road high quality position to

Equity Bank
production to its surrender the
customers orders made by
the customers on
the specified
dates.
2.2 METHODS OF PROMOTION AND ADVERTISING

PATRICIA’S AGROVET will employ unique promotional and advertising technique in order
to make products and other related services from the enterprise known to its potential
customers.
ADVERTISEMENT
The business intends to use television, newspaper mostly for advertising its products and
services for at least three days immediately after the news highlights when the audience are
still attentive and bill board will be mounted at the market place
6
PROMOTION METHOD
The business intends to higher qualified salesmen in company of its agents together with
some of the sample products intended for customers displays and demonstructions made on
all the features of the products. The effectiveness of each promotional programme will be
measured by the rate at which customers and sales are increasing within a specified period.
3.2 PRICING STRATEGY

PATRICIA’S AGROVET intends to price its products reasonably. The business will
therefore carry out on intensive marketing research on the available price for its products. The
main feature that will influence the pricing setting are the customers which are the business
would like to retain by quoting reasonable prices to run because of credit that will be offered
depending on the terms and conditions of the business.
3.3 SALES TACTICS

The business will use various methods in order to reach its potential customers. The business
will use some of its authorized agents to sell its products on its behalf. Qualified sales men
who will directly to customers around the area.
2.4 DISTRIBUTION STRATEGY

Basically, the business will mainly use road transport to distribute its products to its
consumer. This is because the means of transport is relatively cheaper and flexible hence its
reliable and suitable to both the customer and business.
The business will also be using its agents located in different area as in town to distribute
intends to spent approximately a third of the preserved cash or specifically transporting
matters only.
7
CHAPTER THREE
2.0 ORGANIZATIONAL PLAN 3.4 ORGANIZATIONAL STRUCTURE

The following shows the organizational structure of my business.
MANAGERS
SUPERVISORS
SECURITY GUARD CLEANER DRIVER
The organizational structure shows the people who employees from top increases to the
bottom decreases. It shows the people who are qualified.
The cleaner will make sure that PATRICIA’S AGROVET is clean while the security guard
will offer good security to the agrovet.
3.5 MANAGERS AND QUALIFICATION

The owner of PATRICIA’S AGROVET will employ a manager who will have the following
qualifications;
- Be a citizen of Kenya
- Having attained the age of 25 years and above
8
- Be a computer literate
- Having an experience of at least four years in doing the job
- Having attained a minimal grade of C+ in KCSE results and has either a diploma or a
- degree.
3.6 PERSONNEL, NUMBER AND DUTIES

The driver will be one and ensures that the medicine is transported from one place to another
and ensures satisfaction of the customers by the means of transport.
Cleaner: this is the person who ensures that the medicines are organized in a well manner.
The goods that are brought daily are displayed at the mirror and she also ensures that the
room is always neat and clean in order to win the customers satisfaction on the goods they
buy are goods for human to buy for treatment.
Security guard: this is the person who ensures that the medicines are protected from weevils
and termites while still in the store.
2.7 RECRUITMENT, TRAINING AND PROMOTION

The enterprise will mostly recruit employees using the internal sources of recruitment. The
business will use posters and internet to advertise the people together with a qualified person
in their respective positions.
Training: the business intends to conduct its training process for its employees once in a
month. This process will be carried out through teaching them on the skills and knowledge
hence the business will efficiently acquire great and quality production to demand and
increased products.
Promotion: the business intends to various promotion methods. The business will be
therefore carryout on intensive marketing research on the available price. The business
intends for the customers displays and demonstrations made on all the features of the product.
The effectiveness of each promotional programme will be measured and sales are increasing
within a specified period.
9
2.7 REMUNERATION AND INCENTIVE
The following key personnel shows the payment of the members as follows;
KEY PERSONNEL SALARY PER MONTH SALARY PER YEAR

Manager 60,000 720,000
Supervisor 20,000 240,000
Total 80,000 960,000
Also the following support staff would get the following payment according to their previous
job.
SUPPORT STAFF SALARY PER MONTH SALARY PER YEAR

Security guard 12,000 144,000
Cleaners 8,000 96,000
Driver 4,000 48,000
Total 24,000 288,000
The above information shows the payment of all workers in the institution. Also there is
allowances that will be given to the workers risk allowances.
ALLOWANCES SALARY PER MONTH SALARY PER YEAR

Medical 10,000 120,000
House 5,000 60,000
Risk Allowance 2,000 24,000
Transport 500 6,000
Total 17,500 210,000
10
2.8 LICENSES, PERMITS AND BY-LAWS
In order for the business to prosper I will make sure that I have a document that I will be
issued to workers or submitted in the government as a reference of being allowed to do such
business.
Permits: this is a document which gives temporary opportunity to carry out a particular
trading. It will be the permit of selling product from one area to another.
By-laws: there will be a certain rule and regulations which are set by the government
concerning the business. The following will be some of the rules and regulations that I came
up with;
i) Illegal products are being prohibited.
ii) Paying of loans on time iii) In order to run the business, he/she should
have a license or a permit or a certificate.
3.7 SUPPORT SERVICES

The provisional services that I will offer to the business will include the following; banking,
insurance, communication facilities.
SUPPORT SERVICES NAME OF ACTIVITY CHARGES

Banking Equity 37%
Insurance KCB 88%
Advertisement Newspaper 12%
The depositing of money will be done on weekly basis. The amount which will be deposited
is 60,000. This will work so that the account to be activated.
11
CHAPTER FOUR
4.0 OPERATIONAL PLAN 4.1 PRODUCT OR SERVICE DESIGN AND
DEVELOPMENT
PATRICIA’S AGROVET will ensure that it purchases the latest and quality medicine to its
customer. The arrangements and display of its products will be unique and attractive to its
customer for example, layer mash and chick mash will be arranged in rows followed by
magadi, arranged according to their quality in ascending order i.e from the smallest to the
largest. It will be displayed in such a manner that customers coming to PATRICIA’S
AGROVET services shall be able to spot the products.
The E-section shall be a very quiet room for people coming for printing services shall access
it without interferences of noise. This shall be a waiting room for people coming for binding
services. This shall be adjust to the Agrovet section. Any other service shall be sit there
waiting to be served.
4.2 PRODUCTION OR OPERATIONAL FACILITIES AND CAPACITY

The following table shows the equipment and tools, the business will require to operate its
daily duties.
ITEM NO. USES SUPPLIER COST TOTAL

Calculator 2 For calculation Khetia’s 1,200 24,000
Fire extinguisher 6 To put fire off Tusky’s 20,000 120,000
Dust bin 3 For putting dust China 75 225
things like
plastic papers
Broom 2 For sweeping Khetia’s 20 40
Chick feeder 6 For chick Tusky’s 100 600
feeding
Knap sack 4 For spraying Transmart 1,200 1,800
Chick drinker 2 For chicks Nakumart 100 200
drinking water
Bench 3 For customers Nakumart 300 900
to sit on Hardware
12
4.3 PRODUCTION OR SERVICE STRATEGY
Goods are ordered from the dealers in Bungoma town and transporeted through Probox to
town and stocked afterwards. Customers should enter and place orders on the counter and he
is instructed to pay in accounts office where he will be issued with the product receipts. The
following will issue to employees every month.
PARTICULARS EXPENSES PER MONTH

Transport 1,000
Salaries 10,000
Wages 5,000
Advertisement 3,000
Labour 2,000
Electricity bill 10,000
4.4 PRODUCTION PROCESS

The business will be carried out by the designed who will be assigned duties by the manager
who will be act as the supervisor, some of the major services will be carried out in the
Agrovet.
Step 1
Welcome the customers or visitors warmly and softly and give her a seat and ask which
product does she or he want. The type of medicine she/he needs should be packed for
him/her.
Step 2
If the chicks are still younger. The customer is given chick mash for faster growth of her
chicks. Step 3
I give the customer the medicine he orders and instructs him on the dosage.
Step 4
All the payments are made in the accounts office and a receipt is issued. A calculator is used
to help me get the total amount for the customers purchased goods and the exact change in
case there is a balance to the customer.
13
4.5 REGULATIONS AFFECTING OPERATIONS
The firm shall consider all the health regulations and put them into practice. Any litter will be
disposed in a dug composite pit. Every worker will always have a dust coat in the company
apart from the equals who will have a different colour. Whenever a customer is being served,
he will be required to put on a dust coat to avoid his clothes being in conduct with the
chemicals. Incase of an accident in the firm,, one will be given first aid before being taken to
the hospital. The room will have good ventilations for fresh air and avoid chemical
contamination. All workers will be or shall be issuing. In case of an accident, in order to get
compensation.
The organization or government policy should ensure that license has been obtained for
effective operation of the business.
4.5 EQUIPMENT OR MATERIALS

The furniture will also be used to make boxes where the money will be kept before taking to
the bank. The computer will also be used for typing and printing papers, also in my business
like paper, containers and dirty things. Chairs and tables will be used for customers to sit on
as they wait to be served.
14
CHAPTER FIVE 5
FINANCIAL PLAN
5.4 PRE-OPERATIONAL COST
The following are items and costs that incur before I start the business
ITEM COST(PER YEAR)

Rent 10,000
Transport 15,000
Insurance 5,000
Licenses 3,000
Advertisement 5,000
Tools and Equipment 1,000
Total 39,000
5.5 ESTIMATION OF WORKING CAPITAL

The following is the amount needed before I start my business.
ITEM 1ST YEAR(SHS) 2ND YEAR(SHS) 3RD YEAR(SHS)

Current assets
Debtors 70,000 80,000 50,000
Stock 40,000 40,000 10,000
Cash in hand 300,000 400,000 5,000
Cash at bank 10,000 5,000 1,000

Total current assets 420,000 525,000 66,000
Current liabilities
Creditors 30,000 5,000 10,000

Bank overdraft 80,000 10,000 20,000
Total current liabilities 110,000 15,000 30,000
15
Difference of current assets and current liabilities working capital of 1st year.
WC = CA – CL
420,000 – 110,000 = 310,000
1ST YEAR = Shs 310,000
2nd YEAR
Working capital = Current assets – Current liabilities
2nd year = 525,000 – 15,000 = shs 510,000
= shs 510,000
3rd YEAR
Working capital = current assets – liabilities
66,000 – 30,000 = 36,000
3rd year = shs 36,000
16
5.6 PREPARATION OF CASH FLOW PROJECTS FOR YEAR 1
PARTICULARS JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC
Cash flow - 111,110 139,710 175,820 128,920 95,530 206,640 276,180 411,190 516,800 550,370 685,380
Sales 40,000 30,000 120,000 50,000 10,000 50,000 40,000 60,000 100,000 80,000 60,000 80,000
Cash at bank 120,000 60,000 10,000 5,000 50,000 40,000 60,000 70,000 60,000 50,000 100,000 50,000
Cash in hand 50,000 10,000 5,000 - 1,000 120,000 70,000 100,000 40,000 100,000 70,000 130,000
Total cash inflow 210,000 211,110 274,710 230,820 189,920 305,530 376,640 506,180 611,190 746,800 780,370 945,380
Total cash outflow
Purchases 50,000 40,000 50,000 30,000 40,000 50,000 60,000 50,000 40,000 3,600 50,000 3,660
Salaries 37,500 20,000 37,500 60,000 37,500 37,500 1,660 1,660 37,500 40,000 37,500 40,000
Insurance 1,660 10,000 1,660 10,000 - 1,660 37,500 37,500 - 200 1,660 200
Water 500 - 500 - 1,660 200 200 500 200 - - 530
Electricity 200 200 200 500 200 500 - - 1,660 530 350 -
Transport 530 500 530 200 530 3,500 200 200 - 1,660 3,500 1,000
Advertising 3,500 - 3,500 100 - 530 100 3,500 530 1,000 200 1,660
Expenses 3,500 200 3,500 - 3,500 500 - 530 1,000 1,000 1,000 10,000
Rent 5,00 500 500 500 1,000 3,500 300 1,000 10,000 15,000 530 1,000
Renovation 1,000 - 1,000 600 10,000 1,000 500 100 3,500 100 100 150,000
Total cash outflow 98,890 71,400 98,890 101,900 94,390 98,890 100,460 94,990 94,390 196,430 94,990 196,430
Net cash 111,110 139,710 175,820 128,920 95,530 206,640 276,180 411,190 516,800 550,370 685,380 748,950
17 | P a g e
Cash flow 748,950 859,050 1,063250 1,015,150 1,115,250 1,074,050 1,034,550 990,150 950,550 910,450 897,950 855,950
Sales 40,000 20,000 - 30,000 - 0 0 0 0 30,000 - 80,000
Cash at bank 100,000 200,000 - 10,000 - 0 0 0 0 30,000 - 80,000
Cash in hand 20,000 30,000 - 100,000 - 0 0 0 0 5,000 - -
Total cash inflow 908,950 1,109,050 1,063,250 1,155,150 1,115,250 1,074,050 1,034,550 990,150 950,550 946,450 897,950 935,950
Total cash outflow
Purchases 500 5,000 1,000 - - - 37,500 37,500 - - - -
Salaries 37,500 37,500 37,500 - 37,500 37,500 - - 37,500 37,500 37,500 37,500
Insurance 100 - 2,000 - 100 200 3,000 100 1,000 - 200 10,000
Water 10,000 500 200 37,500 - 500 2,000 - - 500 100 -
Electricity 200 100 200 500 100 - 1,000 1,000 500 - 200 3,000
Transport 100 - - 100 2,000 300 - - - 10,000 300 500
Advertising - 200 - 500 500 - 100 - - - 200 -
Expenses - 500 500 300 - - 300 1,000 - 500 1,000 -
Rent 2,000 - 2,000 1,000 1,000 1,000 - - 1,000 - 2,500 3,000
Renovation - 2,000 200 - - - 500 - 100 - - 500
Net cash 859,050 1,063250 1,015,150 1,115,250 1,074,050 1,034,550 990,150 950,550 910,450 897,950 855,950 881,450
18 | P a g e
Cash flow 881,450 842,560 814,160 715,270 664,870 570,480 474,590 464,130 469,140 417,250 280,820 189,830
Sales 40,000 30,000 - 50,000 - 1,000 40,000 60,000 40,000 25,000 1,000 50,000
Cash at bank 10,000 6,000 - 1,000 - 1,000 30,000 20,000 1,000 25,000 1,000 10,000
Cash in hand 10,000 7,000 - 500 - 1,000 20,000 20,000 1,500 10,000 2,000 5,000
Total cash inflow 941,450 885,560 814,160 766,770 664,870 573,480 564,590 564,130 11,640 477,250 284,820 254,830
Total cash outflow
Purchases 50,000 40,000 50,000 30,000 40,000 50,000 60,000 50,000 40,000 3,600 50,000 3,600
Salaries 37,500 20,000 37,500 60,000 37,500 37,500 1,660 1,660 37,500 40,000 37,500 40,000
Insurance 1,660 10,000 1,660 10,000 - 1,660 37,500 37,500 - 200 1,660 200
Water 500 - 500 - 1,660 200 200 500 200 - - 530
Electricity 200 200 200 500 200 500 - - 1,660 530 500 -
Transport 530 500 530 200 530 3,500 200 200 - 1,660 3,500 1,000
Advertising 3,500 - 3,500 100 - 530 100 3,500 530 1,000 200 1,660
Expenses 3,500 200 3,500 - 3,500 500 - 1,000 1,000 1,000 1,000 10,000
Rent 5,00 500 500 500 1,000 3,500 500 100 10,000 150,000 530 1,000
Renovation 1,000 - 1,000 600 10,000 1,000 500 530 3,500 100 100 150,000
Net cash 842,560 814,160 715,270 664,870 570,480 474,590 464,130 469,140 417,250 280,820 189,830 58,400
19 | P a g e
YEAR 1
5.9 TRADING, PROFIT AND LOSS ACCOUNT(PROFORMA INCOME)

ITEMS YEAR 1 YEAR 2 YEAR 3
Sales 4,210,000 463,100 50,941,100
Less cost of sales 2,235,000 2,458,500 223,500
Gross profit 1,975,000 2,172,500 1,975,000
Pick up hire 1,415,000 120,000 1,415,000
Less expenses
Salaries 64,800 64,800 64,800
Rent 36,000 36,000 48,000
Water 6,850 7,500 8,500
Electricity 19,500 23,000 26,000
Advertisement 67,500 72,250 8,500
Loan interest 7,000 12,000 12,000
Insurance 2,500 4,000 6,000
Postage telephone 3,850 41,500 48,000
License permit 4,500 5,000 6,000
Fuel 334,400 340,000 365,000
Repair and maintenance 265,250 275,250 295,750
Depreciation 54,060 1,484,060 54,060 519,060 54,060 160,310
Net profit margin 1,905,940 1,853,440 2,211,440
Taxation 762,376 741,376 884,566
Profit after tax 1,143,564 1,112,064 1,326,864
20 | P a g e
YEAR 2

Sales 463,100 4,210,000 50,941,100
Less cost of sales 2,458,500 2,235,000 2,704,350
Gross profit 2,172,500 1,975,000 3,389,750
Pick up hire 120,000 1,415,000 1,425,000
Less expenses
Salaries 64,800 64,800 64,800
Rent 36,000 36,000 48,000
Water 7,500 6,880 8,500
Electricity 23,000 19,500 26,000
Advertisement 72,250 67,500 8,500
Loan interest 12,000 7,000 12,000
Insurance 4,000 2,500 6,000
Fuel 340,000 334,400 365,000
Depreciation 54,060 519,060 54,060 1,484,060 54,060 160,310
Taxation 741,376 762,376 884,566
Profit after tax 1,112,064 1,143,564 1,326,864
21 | P a g e
YEAR 3
Sales 4,210,000 463,100 50,941,100
Less cost of sales 2,235,000 2,458,500 2,704,350
Gross profit 1,975,000 2,172,500 2,389,750
Pick up hire 1,415,000 120,000 1,425,000
Less expenses
Salaries 64,800 64,800 64,800
Rent 36,000 36,000 48,000
Water 6,850 7,500 8,500
Electricity 19,500 23,000 26,000
Advertisement 67,500 72,250 8,500
Loan interest 7,000 12,000 12,000
Insurance 2,500 4,000 6,000
Fuel 334,400 340,000 365,000
Depreciation 54,060 1,484,060 54,060 519,060 54,060 160,310
Taxation 762,376 741,376 884,566
Profit after tax 1,143,564 1,112,064 1,326,864
BALANCE SHEET YEAR 1

Balance sheet of PATRICIA’S AGROVET
As At 1st JANUARY 2024

22 | P a g e
FIXED ASSETS SHS CURRENT LIABILITIES SHS
Calculator 1,500 Short term loan 35,000
Computers 40,000 Creditors 15,000

Vehicles 120,000 Bank overdraft 35,000
land
30,000
Total fixed assets 1,272,500 Total current liabilities 85,000
Current assets Long term liabilities
Stock 450,000 Owner’s equity 2,057,500
Cash at bank 200,000
Cash in hand 100,000
Debtors 120,000
Total current assets 870,000 Total long term liabilities 2,057,500
Total assets 2,142,500 Total liabilities 2,142,500
5.7 BALANCE SHEET YEAR 2 Balance

sheet of PATRICIA’S AGROVET

Calculator 1,200 Short term liabilities 3,500
land 30,000
Total fixed assets 231,200 Total current liabilities 85,000
Debtors 120,000
23 | P a g e
5.8 BALANCE SHEET YEAR 3

Balance sheet of PATRICIA’S AGROVET

Calculator 1,500 Short term loan 35,000

land
30,000
Total fixed assets 1,272,500 Total current liabilities 85,000
Debtors 120,000
5.7 BREAK EVEN POINT IN(UNIT)

DESCRIPTION AMOUNT
Sales 4,210,000
Electricity 4,600
Water 6,000
Insurance 6,000
Transport 1,800
24 | P a g e
Contribution 4,191,600
Contribution margin = 4,191,600
4,210,000
= 99.56%
FIXED COST AMOUNT

Salaries 36,000
Loan repayments 140,000
Total fixed assets 176,000
2. Break even point = fixed cost x 100
Contribution per unit
176,000 x 100
99.6
= shs 176,706.827
3. Contribution/sales ratio = contribution x 100
Total assets
= 4,191,600 x 100
4,210,000
= 99.56%
5.8 GROSS PROFIT RATIO

Gross profit x 100
Sales
25 | P a g e
= 3,180,000 x 100
4,180,000
= 76.1%
2. Return on Equity
Net profit after tax x 100
Owner Equity
= 641,280 x 100
800,000
= 80.1%
Return on Investment = Net profit after tax x interest x 100
Total investment
= (870,000 + 0) x 100
500,000
= 17.4%
5.9RETURN FINANCING
Return on Equity = Net profit after tax x 100
Owner’s Equity
= 641,280 x 100
800,000
= 80.1%
26 | P a g e
5.9.1 PROPOSED CAPITALIZATION
Return on Investment = Net profit after tax x interest x 100
Total investment
= (870,000 + 0) x 100
500,000
= 17.4%
27 | P a g e

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Business Plan

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PATRICIA’S BUSINESS PLAN

P.O BOX 300 ENDEBESS

TITLE : BUSINESS PLAN

NAME OF PRESENTER PATRICIA MBITHI

CENTRE NO : KITALE NATIONAL POLYTECHNIC

PRESENTED TO : KENYA NATIONAL EXAMINATION

FOR THE AWARD OF DIPLOMA IN

CENTER NAME : KITALE NATIONAL POLYTECHNIC

DATE PRESENTED : JULY, 2024 SERIES

Name : PATRICIA MBITHI

Supervisor’s Name : MIS SARAH

I say thanks and God bless all of you.

1.2 MARKETING PLAN

1.3 ORGANIZATIONAL PLAN

1.4 PRODUCTION PLAN

High standard of discipline has to be observed by the employees. ii)

The sole representative will be responsible for serving the customers.

1.5 FINANCIAL PLAN

1.0 BUSINESS DESCRIPTION

1.1 BUSINESS NAME

P.O BOX 300, ENDEBESS

Its address will be patriciambithi21@gmail.com . The business will be called PATRICIA’S

1.2 BUSINESS LOCATION AND ADDRESS

P. O. BOX 300, ENDEBESS.

2.2 TYPES OF BUSINESS

2.3 PRODUCT AND SERVICES

1.6 JUSTIFICATION OF THE OPPORTUNITY

1.8 GOALS OF THE BUSINESS

SHORT TERM GOALS

LONG TERM GOALS

1.9 ENTRIES AND GROWTH STRATEGY

1) Kaptama Health Center

Kalvin Enterprises After 2 years

COMPETITORS SIZE LOCATION STRENGTH WEAKNESSES

Road high quality position to

2.2 METHODS OF PROMOTION AND ADVERTISING

3.2 PRICING STRATEGY

3.3 SALES TACTICS

2.4 DISTRIBUTION STRATEGY

2.0 ORGANIZATIONAL PLAN 3.4 ORGANIZATIONAL STRUCTURE

SECURITY GUARD CLEANER DRIVER

3.5 MANAGERS AND QUALIFICATION

- Having attained the age of 25 years and above

- Having an experience of at least four years in doing the job

3.6 PERSONNEL, NUMBER AND DUTIES

2.7 RECRUITMENT, TRAINING AND PROMOTION

KEY PERSONNEL SALARY PER MONTH SALARY PER YEAR

SUPPORT STAFF SALARY PER MONTH SALARY PER YEAR

ALLOWANCES SALARY PER MONTH SALARY PER YEAR

i) Illegal products are being prohibited.

3.7 SUPPORT SERVICES

SUPPORT SERVICES NAME OF ACTIVITY CHARGES

4.2 PRODUCTION OR OPERATIONAL FACILITIES AND CAPACITY

ITEM NO. USES SUPPLIER COST TOTAL

PARTICULARS EXPENSES PER MONTH

4.4 PRODUCTION PROCESS

4.5 EQUIPMENT OR MATERIALS

ITEM COST(PER YEAR)

5.5 ESTIMATION OF WORKING CAPITAL

ITEM 1ST YEAR(SHS) 2ND YEAR(SHS) 3RD YEAR(SHS)

Debtors 70,000 80,000 50,000

Stock 40,000 40,000 10,000

Cash in hand 300,000 400,000 5,000