BUSINESS PLAN

EZZYS POULTRY FARMING

ADDRESS:P.O.BOX 16581, NAKURU

TELEPHONE:0700411514

EMAIL:[email protected]

NAME OF PRESENTER:STACY BOSIBORI OMWANZA

INSTITUTE:MERU NATIONAL POLYTECHNIC

COURSE:SUPPLY CHAIN MANAGEMENT

PRESENTER:KENYA NATIONAL EXAMATION COUNCIL IN COMPLETE FULFILMENT FOR THE CROWN OF

DIPLOMA IN SUPPLY CHAIN MANAGEMENT

SERIES:JULY 2018
DECLERATION

I STACY OMWANZA BOSIBORI declare that this business plan is my original work and has never been

presented to the Kenya NATIONAL EXAMINATION COUNCIL or any other body for the award of

certificate ,diploma or degree .

NAME:…………………………………

INDEX NO:……………………………….

SIGNATURE:………………………..

DATE:……………………………….

This business plan is being submitted to the Kenya national examination council with my approbation

Supervisor name:………………………………………….

Signature:……………………………………………….

Date:……………………………………………………….
 DEDICATION

I dedicate this business plan to mr. George omwanza and mrs Judith omwanza brother annold omwanza

And sisters lindah omwanza , mitchelle omwanza and bonielle omwannza for the aid and

encouragement they have given me in making sure that I complete this business plan successfully
 ACKNOWLEDGE

I WOULD LIKE to acknowledge God for giving me knowledge alongside life ad power to write this entire

business plan. Special thaks to my lecture mr Isaac muthiga for training and equipping me with the best

knowledge on how to write a proper business plan. I want to thank my fellow students of diploma in

supply chain management for encouranging and helping me decide on the best business idea

After recognizing my potential and capability.my GOD bless the abundantly

 CHAPTER ONE

1.0 BUSINESS DESCRIPTION

1.1 BUSINESS NAME

EZZYS POULTRY FARMERS

P.O.BOX 16581

NAKURU,KENYA

EZZY poultry farmers is business which will be located in nakuru county, nakuru town and the name

ezzy was derived from its meaning which is plenty . Indeed the business has been making a lot of

sales since it started. The business is aimed at rearing chicken at the most appropriate way in order

to get eggs in large quantities so as to satisfy the needs of our customers.

The business also is aimed at providing chicken meat for our customers. In this business layers and

broilers will be reared at which layers will be numerous for eggs production as well as broilers for

meat production.

According to the researchers and scientists 74% of the worlds poultry is produced for meat and 68%

for eggs are produced I ways which are described as intensive. One alternative to intensive poultry

farming is free range farming using lower stocking densities

Free range farming allows chicken to roam freely for a period of the day ,although they are usually

confined in sheds to protect them from predators

I intend to start this business come January 2019 due to the availability of resources. the business is

in a pecitron to start I the year due to the skills that I have acquired In chicken farming and also the

availability of resourcesv such as land, capital and labour

 BUSINESS LOGO AND TRADEMARK

The above business logo shows chicken and eggs which is the business main work on producing

chicken chicken and eggs. This business is built on intergrity and honesty being the core values of

my business

It has a slogan which states “strive to achieve” this motto will motivate the business to work hard in

order to achieve the best.

This can be achieved through hardwork

1.2 BUSINESS LOCATION

EZZY POULTRY FARMERS will be located in nakuru county nakuru town .this town is condusive for

starting my business due to the availability of various factors of production such as labour and land

based on the business location , itb would be located I nakuru town opposite bontala hotel along

Kenyatta road. The location of the business is favorable due to proximity to the nearest city which is

nakuru town and it can serve as a market for the products of the business will be supplying .
ADDRESS:P.O.BOX 16581

TELEPHONE:030814894

MOBILE NO:0700411514

EMAIL:[email protected]

WEB ADDRESS:WWW.EZZYPOULTRYFARMERS.CO.KE

The business location is suitable due to the infrastructure available such as roads which will make

transportation of eggs and chicken easier and more economical. There is also availability of water from

the county government of nakuru. The regards to the location of the business , it is situated near many

customers such as bontala hotel and cathey hotel whom the business will be supplying the products

to.

There is also potential suppliers of chicken foods such as layers mash and growers mash

The security of the area is adequate since there is a police station in the nearby place .the business is

located at a suitable place where it covers a big markets gap around the region surrounding nakuru

town .the surrounding area has a big population and this will increase the demand for eggs and meat

and also selling of breeds. The people around the area also speak a common language which is either

English or Kiswahili making communication easy and efficient.

SKETCH OF BUSINESS LOCATION

NAKURU TOWN
Ezzy’s poultry farmers Nakuru
church

KENYATTA ROAD

Nakuru
Bontana hotel
primary
school

1.3 FORM OF OWNERSHIP

I intend to make ezzy poultry farmers a sole proprietorship business . this type of the business is where I

will be managing the business and I will be responsible for all the business . this type of ownership is

suitable because there will be no disagreements because I will be operating alone ,assisted by family

members . I decided to chose this type of ownership because it is easy to form and requires few legal

formalities to start.it has the following advantages

Requires few legal formalities and it is not complicated

A sole proprietor has full control of the business and does not need to be instructed by anyone

A sole proprietor makes his or her own decision hence the decision making I the business will be faster

There is minimal costs of forming the business

In this type of business there are no specific business taxes paid by the company, the owner pays taxes

on income from the business as part of his or her personal income tax payment

It is however the simplest type of business structure and it does not involve many of the complex filling

requirements such as co-oporations

1.4 TYPE OF THE BUSINESS

This type of business is aimed at operating in form of wholesale and also on retail basis. This business

will be supplying eggs and meat across the area to all its potential customers within and outside nakuru

town. It is mostly aimed at supplying eggs and meat to hotels and organizations in place that are in

need of the such as bakeries

The business will be mostly focused on wholesaling due to the following reasons.

YOU WILL SAVE MONEY ANY AND MAKE MORE MONEY

Wholesaling involves buying in bulk direct from the manufucturers as opposed to going through a

middle person .my business will find it more profitable to sell eggs and chicken meat in wholesale

YOU WILL FAMILIALIZE YOURSELF WITH INDUSTRY KNOWLEDGE

When my business will be supplying the products in wholesale I will familiarize and get to know the

current trends and needs of the customers in the market

YOU WILL BUILD A NETWORK OF SUPPLIERS

By selling eggs and meat in large quantities I will be able to build a stronger bond with other suppliers

on the same products

YOU WILL BE ABLE TO DIVERSIFY

By selling in wholesale , my business will be able to extend the areas of selling the products.

1.5 PRODUCTS AND SERVIVCES

Ezzys poultry farmers will focus on supplying eggs and meat to the potential customers. These products

will to various hotels and companies that require them in their first production process. The products

will reach their intended destination by use of road transport where I will hire a vehicle to transport

them to the customers.

My business will be focused on supplying eggs in various areas within nakuru county and the

surrounding areas .eggs have many uses including

Enhancing the nutritional value of other foods, they are rich in nutrients and by adding them to

vegetables ,wheat floor and also bread

Raising agent ,whisked eggs white includes air to form a fine foam. The air bubbles expand with heat

as in sponge cakes and thus acts as a raising agent

Thickening agent, whipped eggs is used as thickening agent in pie filling, custard sauces and baked

custard

Emulsifying agent, egg yolk keeps liquid like oil in an emulsion by encirding oil particulars, thus

preventing them from sticking together.also from the business customers will acquire many health

benefits such as:

The products will be rich in proteins which is necessary for body building

They contain vital vitamins and minerals

Chicken meat also aids in regulating choresteral and blood pressure

Chick meat is also believed to reduce the risk of cancer in ones body

1.6 JUSTIFICATION OF OPPORTUNITY

This nature of venture is a unique one since nowadays there is a high demand for poultry products

because of there health benefits.

Nevertheless ,many hotels are in high demand for eggs and chicken meat so as to meet the needs of

their customers. Ezzys poultry farmers will be located in suitable location where there is a high

population of customers who can buy it products, this will make it work easier because few people will

be employed to help in the business and therefore the owner will not strain or get to the point of

overworking. The business location is also favorable because of the availability of adequate security

from the nearby police station.

Ezzys poultry farmers will bring a lot of benefits to the residents in the area such as:

It will create employment to the local people both skilled and unskilled

It will lead to utilization of local resourses like labour and land

Provision of goods at low and affordable prices therefore attracting more customers

It will promote and improve the living standards of the people in the region due to employment and

provision of better goods and services

1.7 INDUSTRY

EZZYS POULTRY FARMERS falls under agricultural industry. Poultry farming falls under agriculture

because it is a part of animal husbandry agricultural industry has some characteristics such as ,

It is diverse in terms of distribution across the country

It has been boosted by the modern technology

It requires capital to start

This type of venture requires high capital to start because one needs to build a place where chickens will

be kept and also one may require to buy more chicken and thus needs more capital to start and run the

business

This business will engage the modern technology in many ways to boost and improve it output hence

improving quantity as well as output. I will employ both intensive and free range methods in my

business. Intensive poultry farming method is a highly efficient system which saves land ,feeds, labour

and other resourses

The size of the firm will be medium because there would be production of better products in large

quantities. The agricultural industry is rapidly growing due to the introduction of the modern

technology which makes agriculture efficient .this sector is growing rapidly due to innovations and

inventions made in it.

1.8 BUSINESS GOALS AND OBJECTIVES

EZZY POULTRY FARMERS has its set goals and objectives which it has to accomplish within a specified

period of time. These are the long term as well as short term goals
The short tem goals include the following:

To be the leading suppliers of poultry products in nakuru town and the neighbouring areas

To increase in the number of chicken reared

To increase the level of output for poultry products

To engage in selling the chicks

Long term goals include

To expand the house and build more houses to keep more chicken

1.9 ENTRY AND GROWTH STRATEGIES

EZZYS POULTRY FARMERS will mostly focus on E-marketing to boost the selling of it products. E-
marketing is the application of broad range of information technologies online for:

Transforming marketing strategies to create more customer value through more segmentation ,
targeting and positioning strategies

More efficiently planning and executing the conception , distribution , promotion and pricing of goods
and services and ideas.

The business will start by advertising its products online and thereby attracting more customers. This
because most of the competitors do not have the knowledge of internet and e-marketing therefore I
will attract more customers. The business will also be selling is products at a relatively lower price so as
to attract as many customers as possible

For the business to expand.

Also ezzys poultry farmers will be selling its products in whole and at retail at a relatively affordable cost

, the products offered by the business will be of high quality

 CHAPTER TWO

1.0 MARKETING PLAN

1.1 INTRODUCTION

Marketing is the state of selling and promoting products in the market. The products available in ezzy
poultry farmers are;

-EGGS

-CHICKEN MEAT

The main objective of the business is to identify the potential customers for my products ,the main
customers some being hotels in nakuru county and especially the one that have many customers.

I will offer promotions to my customers as per what they buy from our shop. Then customers who
will be buying in large quantities will be given trade discounts and also after sale services. our
products will be available all the time to satisfy the needs of our customers

2.2 CUSTOMERS

Potential customers will be :

i. Institutions
ii. Individual

INSTITUITIONS

These customers will mainly consist of schools ,colleges , hospitals ,bakeries . my business will mostly
target institutions which commonly use poultry products

INDIVIDUALS

The targeted individual customers include farmers, teacher business people and the whole community

The proposed business is expected to cover a geographical area of about 30 kilometer of the whole
place as its continues to expand

The customers will be looking for performance of the business economy , quality required and
convinience
The income of the customers in the region seems to be medium hence the individual customers are
expected to purchase mostly when need arises and the product will be supplied on time any time during
the business operating hours

2.3 market share

According to the research on the surrounding area there are a total of 1.2 million people living I the
area. Four hundred thousand people by their poultry products from mwalimu chicken farm, three
hundred thousand people buy from jina dogo farm while one hundred thousand buy from elimu
farmers. Therefore the market share will be:

400000 x 100= 33.33%

12000000

The peak sales occur during festive seasons or public holidays because that is when poultry products are
highly demanded .

Low sales occur when there is an outbreak of diseases that affect that affect the chicken hence lowering
their number

Sales

ezzys poultry
farmers
16.7%
mwalimu chicken
farmer33.3%

elimu
farmers
16.7%

timely farmers jina dogo farmers

8.33% 25%
2.4 COMPETATION

These are the competitors that the business will face

COMPETATION ANALYSIS

COMPETITORS % STRENGTH WEAKNESS STRATEGY TO

SHARE COMPETE

Mwalimu 33.33 -have a big market -no enough -motivation of

chicken -the business is packaging area employee
farmers prominent -poor management -payment on time
-adequate security

Jina ndogo 25 -use modern -poor customer -the business will offer
farmers equipment relations advertisement for it
-the business is famous -do not advertise products
-have a good
packaging bay

Timely chicken 8.33 -strong financial base -lack of modern -there will be purchase
farmers -have many brances equipments of modern equipments
-sell in fair prices - location is not
accessible

Ezzys poultry 16.7 -have skilled workers -opens late -the business will
farmers -good management -inadequate capiat improve on it
-Offer quick services operating hours
-offer after sale
services

Elimu farmers 16.7 -have a big market -poor customer -motivation of

-the business is relations employee
prominent -no enough
-sell in fair prices packaging area

2.5. METHODS OF PROMOTION.

The business will undertake promotion compaigne by conducting free introductory services to is
customers. On regular basis the business will employ promotional methods e.g giving special offers on
sales having road shows ,offering free samples ,after sale services like offering transport services to
those who will buy on bulk and at the end of every year customers will be getting free calendars for the
next year indicating the details of the business.
The amount used for promotional methods should not exceed 10000 per each event and effectiveness
will be determined by the sales made and profit realized in that period.

The methods of promotion to be used by the business will be calendars, billboard and business
cards. The business will also be holding seminars and conferences at least twice per year and
assure the customers that the goods produced are of high quality.

A calendar will cost 100shillings; 59 shillings for a business card one thousand shillings for
billboard.

A calendar will be printed at the start of the year and used throughout the years.

The billboard will be produced at the start of the business and replaced after two years.

The above methods are favoring the business because they are cheap and easily to design. The total
cost of all these methods is shown.

2.6 PRICING POLICY

The business will have a reasonable price to attract more customers and maintain business profits.the
price of the business products and services will greatly depend on the competitive prices. Due to the
economy of the country, the government policies on price may either be favourable or unfavorable.

The pricing of the products will also be determined by labour, rent, advertisement cost, telephone ,
water,transport and electricity bills of which will be 16% of the total cost incurred. The trust worthy
customers and institutions may be given in credit

2.8 DISTRIBUTION METHOD

The mode of transport to be used will be a motorcycle for short distances and lorry for long
distance. The products will be reaching customers through direct selling. This should be through a
well-established road in the area so that all the customers can be served equally.

The motorcycles will be costing 70,000 each and will be driven by the qualified people with
experience. The lorry will cost between 1,000,000 and 2,000,000 and it will be selling and
distributing products along the boundaries. The distribution problem to be faced by the business is
the accidents that occur during the rainy season due to the poor roads hence failing to supply the
quality products instead a lot of loss is incurred. The business is planning to improve the
infrastructures and even make sure the roads are suitable at all season. By doing this the business
will be able to supply the products frequently even to the customers who are far from the market
hence increasing more profit.
 CHAPTER THREE

2.0 ORGANIZATION AND MANAGEMENT PLAN

2.1 MANAGEMENT TEAM

Ezzys poultry farmers will be a sole proprietorship form of business and therefore I will be
managing all the activities taking place in the business. Being the manager ,I will be able to
implement policies that will help In the smooth running of the business. In this particular
business I will also need a number of assistance. They include:

I. Clerk
His /her qualifications will be:
-should possess a diploma certificate in accounting
-at least have one year of experience

II. Sales man

Qualifications
-should possess a diploma in sales and marketing

III. Casual workers

Qualification
-should be physically fit and strong
Instructions and orders will flow as follows:

MANAGER

SALESMAN
CLERK

CASUAL WORKER CASUAL WORKER CASUAL WORKER

1 2 3

3.2 OTHER PERSONNEL

The total number of employees that will be required in ezzys poultry farming will be five and they will
play different roles according to their position in the business. The following table shows a summary of
their job titles , duties salaries and responsibilities

ITEM PERSONNEL NO: QUALIFICATIONS DUTIES SALARY

1 CLERK 1 -SHOULD POSSESS A -TO RECORD ALL FINANCIAL 25000

DIPLOMA I ACCOUNTING TRANSACTIONS OF THE
-SHOULD HAVE AT LEAST BUSINESS AND KEEP
ONE YEAR EXPERIENCE RECORD

2 SALESPERSON 1 -SHOULD POSSESS -TO LOOK FOR THE MARKET 23000

DIPLOMA IN SALES AND OF THE PRODUCT AND ALSO
MARKETING TOGETHER INDENTIFY THE POTENTIAL
WITH ADEQUATE SKILLS CUSTOMERS
IN THE SAME

3 CASUAL 3 -SHOULD BE 18 YEARS MAKING THE 15000

WORKERS AND ABOVE ENVIRONMENT CLEAN AND
-SHOULD BE PHYSICALLY MAINTAIN HIGH LEVEL OF
FIT AND STRONG HYGIENE
3.3 RECRUITMENT TRAINING AND PROMOTING

I. RECRUITMENT
The business is going to recruit members from all over the county and of there will be
advertisement for job vacancies
All applicants will be invented for an interview at the business, those who will qualify will be
given the job by the manager

II. TRAINING
Training will be carried our to equip the workers with more skill adequate for the job. Being the
business manager , I will train all those workers on how to carry out their duties effectively to
increase business sales

III. PROMOTION
The overall performance of workers in the business will go hand in hand with the rising of their
salaries. The employees salaries will be increased according to the effort they put in their place
of work.

III.4 REMUNERATION AND INCENTIVES

Remunerations

The employees are entitled to receive their salaries at the end of the month and later than two days

Incentive

These are wage to encourage employees and motivate them to work harder so as to achieve the
objective more effectively. Each employee has his own rights to express everything that he or she
feels is not making the environment conducive to them. When employees express their ideas freely,
they improve the business and are able to get the right pay at the right time.

Motivation.

The business is ensuring that employees are recognized as roots of the business by providing
various documents like medical hence there is annual leave for the best employee so that they can
be given time for their personal activities
3.5 LEGAL REQUIREMENTS

For the business to run smoothly it will need the following:

Legal requirements

 License
This will enable the business the owner to commence the business and run it smoothly without
any complains from the government
 By laws
By laws from the premises owner and the land lord will require the business owner to pay his
rent within a reasonable time or the period agreed upon
 Local authority certificate
This is the certificate from the municipal council
 Public health certificate

 Insurance cover

SUMMARY OF LEGAL REQUIREMENTS

REQUIREMENT DESCRIPTION WHERE OBTAINED FEES PAID

TRADE LICENSE To make the business Local government 5000 per month
legitimate authory

PUBLIC HEALTH To make the business Public health 2500 per month
recognized by health
board

BUSINESS PERMIT For operating in the Local authorizes 2000 per month
CERTIFICATE locality

QUALITY PERMIT For ensuring good and kebs 1000 per month
standard products

TOTAL 10500
3.6 EXTERNAL SUPPORT SERVICES

for effective running of the business the owner will require the following external services:

BANKING SERVICE

after a few months of operation the business will open its bank account with post bank NAKURU
branch where the business can safely keep its finances and also be able to get financial assistant when
the need arises

BUTULA POST OFFICE

a post office will be convenient to provide the services of mail and also parcels will be collected there.
this will enable placing orders and also postal services will be convenient

green farmers

p.o.box 54-50405

NAKURU

INSURANCE

the service will be provided by:

madison insurance company

p.o.box 116

NAKURU

tel: 0700939129

the business will be insured against fire and theft. The employees will be insure against risk
3.7 GENERAL ORGANIZATION

EZZYS POULTRY FARMERS will adapt a vertical organization structure whereby Instructions and orders
will flow from top to bottom . i.e from the seniors . the business organization chart is as shown below.

MANAGER

CLERK SALESMAN

CASUAL WORKER CASUAL WORKER CASUAL WORKER

1 2 3
 CHAPTER FOUR

PRODUCTION PLAN

4.0 INTRODUCTION
EZZYS POULTRY FARMERS will be producing eggs and also chicken meat. The business aim is to
accomplish all it set goals and objectives as stated earlier. Through focusing on the production of
eggs and meat the business will be able to handle and solve associated with chicken farming

4.1 PRODUCTION FACILITY AND CAPACITY

EZZYS POULTRY FARMERS will use various equipments so as to make production effective. The
equipments will include :

I. Feeders
These are equipment used in feeding the chicken.
II. Heaters and brooders
Is an equipment used in regulating and increasing the temperature of the poultry in the farm .

III. Incubator
This is a equipment used in hatching .

IV. Chick box

An equipment where eggs will be laying eggs
V. Fly trap
This will be used to control flies and other flying insects which are likely to affect the chicken
VI. Poultry plucker rubber finger
this is usually applied to chicken dressing machine
VII. Poultry incubator controller
This is for controlling the incubator and the timer

BUSINESS PREMISES

The business premises will be equipped with all the materials to make production easy and smooth. The
business premise will also contain fire controlling equipment .the business premises will be located in
nakuru opposite bontala hotel . it will also contain shelves for keeping trays of eggs and at some point
the premise will require renovation which will involve paintings and repairing cracks on the walls and
floor.
SUMMARY OF MATERIALS FOR PRODUCTION

ITEM DESCRIPTION SUPPLIER QUANTITY COST TOTAL

EGGS TRAYS PLASTIC Uchindi 70 50 3500
suppliers
INCUBATOR ELECTRONIC Achievers 2 6500 13000
electronics
WATER PLASTIC Uchindi 60 100 6000
COTAINERS suppliers

Utilities for production

The utilities that the business require for production are:

-water

-telephone

-electricity

ITEM DESCRIPTION SUPPLIER QUANTITY COST OR UNIT TOTAL

WATER DRINKING AND MT. KENYA 6000CM3 660 660
FOR FEEDING
THE CHICKEN /
CLEANING
ELECTRICITY HYDROELECTRIC KPLC 100KWH 40 30,100
POWER
TELEPHONE MOBILE PHONE SAFARICOM 11 CALLS A 7 1200
DAY

4.2 PRODUCTION STRATEGY

It will be the duty of the manager who will also be the owner to give instructions to his workers.

He will also ensure the proper procedures are followed in serving customers.they will be served
conveniently to meet their needs .

The following procedures will be used so as to run the business effectively.

The business will be opened from Monday to Saturday

Workers will be in work from 8am to 5pm

PRODUCTION PROCESS

The enterprise is of service industry in nature and it will involve buying commodities at a profit.
STEP 1: Searching for better supply- the manager will indentify where there is a good and potential
suppliers who are capable of supplying the needed items.

STEP 2: Requistioning of material-after indentifying better sources the manager will also indentify all
materials needed.

STEP 3: Purchasing order-it will help the supplier to supply the right and required product of right
quality at right time.

STEP 4: Receiving-after the order the materials are supplied.

STEP 5: Inspection-the manager will inspect the products to ensure that they are of right quality.

STEP 6: Storage-after inspection the materials will be stored.

STEP 7: Display and packaging of product-all products will be displayed appropriately and will be
packaged at appropriate and convenient sizes.

STEP 8: Selling-the enterprise will sell its product to the potential customers with an aim of making profit
and to achieve its goals and objectives.

QUALITY CONTROL

The business will ensure that it products meets the best quality

Each worker will be required to work effectively without being supervised to meet the required
expectations.

The manager will be in charge of goods control and the mode of inspection will be carried out
thoroughly .

LABOUR CONTROL

TABLE SHOWING LABOUR CONTROL

ACTIVITY SKILL NEEDED EDUCATION NEEDED STAFF

SELLING ABLE TO MARKET&SELL ATTAINED TECNIQUES CUSTOMER
PRODUCTS OF SELLING ATTENDANT
PACKAGING ABLE TO MARKET&SELL FORM FOUR LEVER CUSTOMER
PRODUCTS AND ATTENDANT
PACKAGING
SUPERVISING GOOD PUBLIC DIPLOMA IN BUSINESS MANAGER
RELATION MANAGEMENT
BANKING ACCURATE CERTIFICATE IN SECRETARY
ACCOUNTING FINANCIAL
ACCOUNTING
 TIME CONTROL

OPENING WORKING TEA BREAK WORKING LUNCH WORKING CLOSING

TIME TIME TIME BREAK TIME TME

7:30AM 8:00AM 10:30AM 11:00AM 12:40PM 2:00PM 5:10PM

8:00AM 10:30AM 11:00AM 12:40PM 1:30PM 5:00PM

PURCHASING POLICY

The manager of the business will carry out all the responsibilities of ordering and purchasing
products at the convenient time and demand since he has more experience on the market and field
survey

The ordering will be done through the telephone to the supplier

4.3 PRODUCTION PROCESS

This is the act of bringing something forward for consideration.

The manager will receive and handle any case or something brought about from various
dapartments.

This will enable each production level to progress well and maintain good business operation
 4.4 PLANT LAYOUT

ACCOUNTANT

MANAGERS OFFICE OFFICE

COUNTER

4.5 REGULATIONS AFFECTING BUSINESS OPERATION

1. BUILDING REGULATIONS

The business will provide enough space for both workers and customers for proper ventilation and
enough light inside the rooms and the floor will be cleaned daily

2.LICENSE

The business will obtain permit from the municipal council of nakuru

3.SAFETY MEASURES

The business will provide dust coats and musk to workers

It will also install fire extiquishers

4.HYGIENE REGULATIONS
The business will provide clean drinking water for workers and customers .also toilets will be cleaned
daily

5.ENVIRONMENTAL REGULATION

The business will install dust bins in the premise.this will enhance proper disposal of waste
 CHAPTER FIVE.
FINANCIAL PLAN.
5.1 FINANCIAL PLAN.
The business proposed capital is 360000 which will be raised from personal savings, family
contribution and loan from equity bank. There will be an annual cash flow projection calculation
income statement.

5.2 BOOKS OF ACCOUNT.

The following books are to be used in the process of translation in the business.
1. Cash book
This is a financial book which contains information about the money required in form of
cheque or cash.
2. Ledger
It gives details of bills or expenses undertaken by the business like salaries, electricity
bills rented.
3. Purchase ledger
It is book that contains materials and the equipments that will be bought.

5.2 PRE-OPERATION COST.

Summary of pre-operation cost.

ITEMS AMOUNT IN KSH

License and permit 4440.0
Legal consultancy 8500.0
Bank deposits 430.0
Post office rent 1800.0
Advertisements and promotions 6000.0
Travelling cost 1200.0
Loan and processing fee 5000.0
Deposit for water, electricity and telephone 8000.0
Miscellaneous expenses 1100.0
Total pre-operation cost 28780.0

5.3 ESTIMATION OF WORKING CAPITAL

Working capital is the amount of money used for day to day running of the business. Working
capital required is ksh 231,500.which will enable the business to purchase some products.
SUMMARY OF THE WORKING CAPITAL.

ITEMS AMOUNT IN CASH

Opening stock 60,000.00
Salaries 34,000.00
Transport expenses 2000.00
Rent 25000.00
Cash at hand 40000
Loan repayment 2000.00
Inventory material 48000
Water ,electricity and telephone 500
Total 231,500

5.4 ESTIMATION OF FIXED ASSENTS.

Assets are long lasting or even short lasting items.they include computers , mobile phones ,
generator e.t.c

ITEMS AMOUNT IN CASH

Freezer 95000
Generator 35000
Computer 45000

Telephone 5000

total 180000
 5.5 CASH FLOW PROJECTION

CASH FLOW PROJECTION FOR EZZY’S POULTRY FARMERS FOR YEAR ONE
ITEMS JAN FEB MARC APRIL MAY JUNE JULY AUG SEPT OCT NOV DEC TOTAL
H
CASH INFLOW
CASH SALES 54350 3915 47580 42350 4885 5760 45800 30250 5940 5648 6750 468 596100
0 0 0 0 0 50
BANK INTEREST 120 1200
0
DEBTORS 18350 22480 285 69330
00
TOTAL CASH 54350 3915 47580 60700 48850 5760 45870 22480 5940 5648 6750 995 562730
FLOW 0 0 0 0 0 0 50
CASH OUTFLOW
PURCHASES 21000 2800 15000 30000 10200 9000 11500 2000 9000 7000 5000 750 149000
0 0
LOAN 4500 4500 4500 4500 4500 4500 4500 4500 4500 4500 4500 450 45000
PAYMENTS 0
LICENSES 1200 1200
TELEPHONE BILL 250 100 400 150 50 200 150 100 100 300 250 100 2150
2000 2500 4500
ADVRETISEMEN
T
ELECTRICTY BILL 700 700 700 400 300 200 300 100 100 100 100 100 3800
WATER BILL 150 150 150 150 150 150 150 150 150 150 150 150 1800
SALARIES 3200 3200 3200 3200 3200 3200 3200 3200 3200 3200 3200 320 38400
0
TOTAL CASH 59800 3045 23950 35900 18400 1725 19800 5550 1705 1775 1320 155 274650
OUT FLOW 0 0 0 0 0 50
NET CASH 55450 8700 23630 24800 30450 4035 26000 2220 4035 3873 5430 400 288080
0 0 0 0 0
CUMALITIVE 55450 3045 23950 35900 18450 1725 19800 5550 1710 1775 1320 155 274650
0 0 0 0 0 50
CASH FLOW PROJECTION FOR EZZY’S POULTRY FARMERS FOR YEAR TWO
ITEMS JAN FEB MARC APRIL MAY JUNE JULY AUG SEPT OCT NOV DEC TOTAL
H
CASH INFLOW
CASH SALES 54000 3900 48000 47350 49000 5945 58500 69500 5940 4880 5580 490 620150
0 0 0 0 0 00
BANK INTEREST 120 1200
0
DEBTORS 500 2000 20500
0
TOTAL CASH 54000 3900 48000 47350 49000 5945 58500 69500 5940 4900 5580 560 641850
FLOW 0 0 0 0 0 00
CASH OUTFLOW
PURCHASES 21600 1150 9750 13450 9000 1005 7500 6510 5200 4500 1000 152 124010
0 0 0 50
LOAN 4500 4500 4500 4500 4500 4500 4500 4500 4500 4500 4500 450 45000
PAYMENTS 0
LICENSES 1200 1200
TELEPHONE BILL 100 100 100 100 100 100 100 100 100 100 100 100 1200
1000 900 1900
ADVRETISEMEN
T
WATER BILL 500 500 500 500 500 500 500 500 500 500 500 500 6000
SALARIES 3200 3200 3200 3200 3200 3200 3200 3200 3200 3200 3200 320 38400
0
TOTAL CASH 32250 1820 17400 13850 18500 1595 3950 13650 1295 1840 2380 184 208550
OUT FLOW 0 0 0 0 0 00
NET CASH 19350 2980 29950 25650 40900 3305 54450 55850 6645 3450 3240 569 450050
0 0 0 0 0 00
CUMALITIVE 19650 1820 17400 13850 18500 1595 4050 13650 1295 1840 1352 238 119800
0 0 0 0 0 00
CASH FLOW PROJECTION FOR EZZY’S POULTRY FARMERS FOR YEAR THREE
ITEMS JAN FEB MARC APRIL MAY JUNE JULY AUG SEPT OCT NOV DEC TOTAL
H
CASH INFLOW
CASH SALES 48000 5600 54000 68000 68000 3000 24000 32000 4900 2900 5900 645 583400
0 0 0 0 0 00
BANK INTEREST 30000 10000 500 45000
0
DEBTORS 15000 1500 1000 40000
0 0
TOTAL CASH
FLOW
CASH OUTFLOW
PURCHASES 14000 2200 15200 14000 12300 1800 20000 12500 1240 2222 1230 274 158320
0 0 0 0 0 00
LOAN 1200 1200
PAYMENTS
LICENSES 1200 1200
TELEPHONE BILL 375 350 400 500 450 300 430 200 1503 350 350 150 3955
00
1650 1650 265 6250
ADVRETISEMEN 0
T
ELECTRICTY BILL 800 800 800 800 800 800 800 800 800 800 800 800 9600
WATER BILL 150 150 150 150 150 150 150 150 150 150 150 150 1800
SALARIES 3200 3200 3200 3200 3200 3200 3200 3200 3200 3200 3200 320 38400
0
TOTAL CASH 22075 2650 19750 16050 16900 2245 24500 18500 1670 1675 1672 343 221325
OUT FLOW 0 0 0 0 0 50
NET CASH 70925 2950 34250 61950 52000 8550 14420 13500 4230 2225 6228 351 447075
0 0 0 0 50
CUMALITIVE 22075 2650 19750 6050 16900 2245 22580 18500 1670 6750 6720 341 221325
0 0 0 50
 5.6 PRO-FORMA INCOME STATEMENT FOR THE THREE YEARS.

ITEM YEAR 1 YEAR 2 YEAR 3 AMOUNT IN

KSH
Cash sales 596160 620150 620150
Credit sales 69300 20500 20500
Bank interest 1200 1200 1200
Total sales 666660 641850 641850
Purchases
Cost of goods 14900 149000 124010 124010 124010 124010
sold
517840 517840

Gross 517660
profit/loss
Expenses
licence 1200 1200 1200
Loan payments 45000 45000 45000
telephone 2150 1250 1250
Water bill 1800 1600 1600
Electricity bill 3800 1800 1800
Advertising 4500 1900 1900
Salaries 38400 38400 38400
Total expenses 96850 95550 95550
Net profit 420810 422290 422290
before tax
Net profit after 392756 394137 394137
tax
 5.8 BREAK EVEN ANALYSIS

FIXED EXPENSES AMOUNT VARIABLE EXPENSES AMOUNT KSH

Purchases 264500 rent 24000
water bill 5830 salaries 72000
transport 3450 license 500
promotion 2000 insurance 4800
miscellaneous 300

TOTAL 276080 101300

Annual sales =

Gross margin sales=sales- variable

529500-276000

=1548100

Gross margin percentage =gross margin x 100

Sales

253420 x 100

592400

=47.86%

Breakeven point

fixed cost x 100

gross margin percentage

= 101300

0.4786

=211.659

BREAK EVEN ANALYSIS FOR END OF YEAR TWO

FIXED EXPENSES AMOUNT VARIABLE EXPENSES AMOUNT KSH
Purchases 384000 rent 24000
water bill 7200 salaries 96000
transport 5400 license -
promotion 8000 insurance 4800
miscellaneous 300

TOTAL 404600 114000

Annual sales =

Gross margin sales=sales- variable

774500-404600

=369900

Gross margin percentage =gross margin x 100

Sales

369900 x 100

774500

=47.76%

Breakeven point

fixed cost x 100

gross margin percentage

= 11400

0.4786

=301.508
BREAK EVEN ANALYSIS FOR END OF YEAR THREE

FIXED EXPENSES AMOUNT VARIABLE EXPENSES AMOUNT KSH

Purchases 445000 rent 30000
water bill 8400 salaries 12000
transport 13200 license -
promotion 14400 insurance 4800
miscellaneous -

TOTAL 481000 154800

Annual sales =

Gross margin sales=sales- variable

91000-481000

=429000

Gross margin percentage =gross margin x 100

Sales

429000 x 100

910000

=47.14%

Breakeven point

fixed cost x 100

gross margin percentage

= 154800

0.4714

=328.364

PROFITABILITY RATIOS
YEAR 1

Gross margin percentage= gross margin x 100

Annual sales

265000 x 100

529500

=50%

YEAR 2

Gross margin percentage= gross margin x 100

Annual sales

467500 x 100

774500

=60%

YEAR 3

Gross margin percentage= gross margin x 100

Annual sales

465500 x 100

910000

=51%
 Chapter six

6.1 risks incidental in the business premise

The business might experience some challenging risks during it operation. Some of the risks are:

 Theft
 Fire
 Floods

The risks experienced in a business may hinder its successful and fast growth and the business might
make some lose.

It is therefore prudent to provide or look for some solutions to prevent these risks from occurring.

6.2 solutions to risks

 Strategic solutions
The business will be located in a well leveled ground that is free from floods and other floods
related calamities
 Installations of fire fighting equipments
The business will install the modern automatic fire fighting equipment’s so as to curb the risk of
fire
 Ensuring round the clock security
Cctv’s camera’s will be installed all around the business to boost security
People entering the premise will be screened before being allowed to enter in
Only the authorized people in the premise will be allowed in the store room so as to improve
accountability
Guards will be employed to watch over the premises asset and also the activities going around
in and out of the premises
 Taking of insurance cover
The business will take up a insurance cover from the nearest insurance companies so as it can
be covered and be compensated incase of loss occurring .