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BUSINESS PLAN TITLE :MALAIKAS KUKU JOINT

NAME : FILDA CHELAGAT

CENTER CODE 1802

INDEX NUMBER 534101

PRESENTED TO : KENYA NATIONAL EXAMINATION COUNCIL

FOR PARTIAL FULFILMENT OF CERTIFICATE
IN CATERING & ACCOMODATION

INSTITUTION : RIFT VALLEY TECHNCA TRAINING INSTITUTE

COURSE : CERTIFICATE IN CATERING AND ACCOMODATION

DEPARTMENT : HOSPITALITY , INSTITUTIONAL MANAGEMENT AND

FASHION DESIGN
SUPERVISOR : M. JACKLINE MINYOSO

SERIES : MARCH 2025

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DECLARATION
This business plan is my original work and it has not been presented for any marking in any other learning
institution before.

NAME: FILDA CHELAGAT

DATE: ……………………………………………………………….

SIGNATURE: ……………………………………………………………

The business plan has been submitted to the Kenya National Examination Council in partial
fulfillment of Certificate Award in Food and Beverage Management with my approval as a
supervisor.

NAME: M. JACKLINE MINYOSO

DATE: ……………………………………….

SIGNATURE: ………………………………

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DEDICATION
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This business plan is dedicated to my lovely parents, my brother, sisters and niece. My friends who
gave me unconditional support during my project business plan, and may God bless them all.

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ACKNOWLEDGEMENT
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I sincerely thank the Almighty God for His care, guidance, and protection that has brought me to this day,
enabling me to present the efforts of my hands. His grace and blessings have been my strength
throughout this journey.

I extend my heartfelt gratitude to my supervisor, whose guidance, support, and encouragement have been
invaluable during this period of research and study. Your insights and mentorship have greatly
contributed to the success of this work.

To everyone who has supported and motivated me throughout this endeavor, I express my deepest
appreciation. May God bless you all abundantly.

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Table of Contents
DECLARATION..............................................................................................................................................................ii
DEDICATION................................................................................................................................................................iii
ACKNOWLEDGEMENT.................................................................................................................................................iv
CHAPTER ONE.............................................................................................................................................................1
1.0 BUSINESS DESCRIPTION.........................................................................................................................................1
1.2 MAP LOCATION OF MALAIKA KUKU JOINT............................................................................................................2
1.3 LOCATION AND ADDRESS..................................................................................................................................2
1.3 OWNERSHIP OF THE BUSINESS..........................................................................................................................3
1.4 TYPE OF BUSINESS.............................................................................................................................................3
1.5 PRODUCT OF SERVICE.......................................................................................................................................3
1.7 JUSTIFICATION OF THE BUSINESS......................................................................................................................4
1.8 BUSINESS GOALS...............................................................................................................................................4
1.9 ENTRY AND GROWTH STRATEGY.......................................................................................................................4
CHAPTER TWO............................................................................................................................................................5
2.1POTENTIAL CUSTOMERS .......................................................................................................................................6
2.2Market Share..........................................................................................................................................................7
2.3 COMPETITION....................................................................................................................................................8
2.4 ADVERTIZING AND PROMOTION.......................................................................................................................9
2.5 PRICING STRATEGY............................................................................................................................................9
2.6 SALES TACTICS...................................................................................................................................................9
2.6.1 DIRECT SELLING..........................................................................................................................................9
2.6.2 INDIRECT SELLING.......................................................................................................................................9
2.7 DISTRIBUTION STARTEGY..................................................................................................................................9
CHAPTER THREE....................................................................................................................................................10
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3.0 ORGANIZATIONAL MANAGEMENT PLAN.....................................................................................................10

3.1 ORGANIZATIONAL STRUCTURE....................................................................................................................10
3.2 MANAGEMENT PERSONNEL........................................................................................................................10
3.4 RECRUITMENT TRAINING AND PROMOTIONS.............................................................................................14
3.6 LEGAL REQUIREMENTS................................................................................................................................16
3.7 OTHER SERVICES..........................................................................................................................................16
CHAPTER F0UR......................................................................................................................................................18
4.0 OPERATIONAL AND PRODUCTION PLAN.....................................................................................................18
4.1 OPERATIONAL FACILITIES............................................................................................................................18
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 4.2 OPERATIONAL AND PRODUCTION STRATEGY.............................................................................................18
4.3 PRODUCTION PROCESS...............................................................................................................................19
4.4 REGULATIONS AFFECTING PRODUCTION....................................................................................................20
CHAPTER FIVE........................................................................................................................................................22
5.0 FINANCIAL PLAN..........................................................................................................................................22
5.1 PRE-OPERATIONAL COSTS...........................................................................................................................22
5.2 WORKING CAPITAL......................................................................................................................................22
5.3 PROFORMA CASH FLOW..............................................................................................................................22
5.4 PROFORMA INCOME STATEMENT...............................................................................................................23
5.5 BALANCE SHEET...........................................................................................................................................25
5.7 FINANCIAL RATIOS.......................................................................................................................................28
5.8 PROPOSED CAPITALIZATION........................................................................................................................28
5.9 .1 GROSS PROFIT PERCENTAGE...................................................................................................................29

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 EXECUTIVE SUMMARY

1. DESCRIPTION OF THE BUSINESS PLAN

Business Concept: The business focuses on producing and selling high-quality cooked hen meat, packaged
for convenience and targeted at busy consumers, health-conscious individuals, and families. The meat
will be pre-cooked, seasoned, and available in various cuts and flavors to cater to a wide range of tastes.
The product will be sold through both retail and online channels, with an emphasis on freshness, taste,
and sustainability.

Mission Statement: To provide consumers with a convenient, healthy, and delicious source of cooked hen
meat, delivering high-quality protein options while ensuring sustainability and freshness.

Objectives:

 Establish a reliable and efficient supply chain within the first six months.
 Gain a significant market share within the first two years of operation in the target markets.
 Achieve profitability by the end of Year 1.

2. MARKETING PLAN

Target Market:

 Primary: Busy professionals, health-conscious individuals, and families.

 Secondary: Fitness enthusiasts, weight-conscious consumers, and individuals with a
preference for high-protein, low-fat meals.

Market Research: Based on consumer trends, there is an increasing demand for quick and healthy food
options. Additionally, poultry consumption is expected to rise as more consumers opt for leaner meats.
Health and sustainability trends further support the potential for growth.

Positioning: Our brand will be positioned as a premium product offering convenience without
compromising on quality or health benefits. Our unique selling proposition (USP) is that we provide a
healthy, ready-to-eat alternative to fast food and frozen meals.

Promotion Strategy:

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 Digital Marketing: Utilize social media platforms, influencer marketing, and SEO to build
brand awareness.
 In-store Promotions: Sampling and discounts to encourage trial.
 Partnerships: Collaborate with fitness centers, health clubs, and wellness influencers.
 Loyalty Programs: Implement a rewards system for repeat customers.

Pricing Strategy: We will adopt a competitive pricing model, offering premium-quality cooked hen meat
at prices comparable to other ready-to-eat meal options. Promotions and discounts will be used
strategically to attract new customers.

3. ORGANIZATION AND MANAGEMENT PLAN

Business Structure:

 Founder/CEO: Oversees all operations, strategic direction, and partnerships.

 Operations Manager: Manages the production, inventory, and distribution of products.
 Marketing Director: Leads all marketing initiatives, including digital strategy and
customer engagement.
 Sales Manager: Handles retail partnerships and online sales channels.
 Food Safety and Quality Control Officer: Ensures compliance with food safety regulations and
maintains product quality.

Staffing Requirements:

 Production team (chefs, kitchen staff)

 Sales and marketing team
 Logistics and distribution staff
 Administrative and customer service staff

Advisors:

 Legal advisor for compliance and intellectual property.

 Financial consultant for budgeting, projections, and funding strategies.

4. PRODUCTION AND OPERATING PLAN

Production Process:

1. Sourcing: High-quality, responsibly raised hens will be sourced from trusted suppliers.
2. Cooking: The hens will be cooked using state-of-the-art methods to ensure tenderness and flavor.
3. Packaging: The cooked meat will be packaged in eco-friendly containers that preserve
freshness and taste.

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 4. Quality Control: Strict quality control measures will be implemented at every stage of the
production process to ensure consistency and compliance with health standards.

Facilities:

 Location: The production facility will be strategically located to ensure timely delivery to key
retail partners and customers.
 Equipment: Commercial kitchen equipment, including industrial ovens, shredders, and
packaging lines.
 Storage: Climate-controlled storage units for both raw materials and finished products.

Operating Plan:

 Supply Chain: Establish reliable relationships with suppliers for raw ingredients, packaging
materials, and logistics partners.
 Distribution Channels: Products will be available through retail stores, supermarkets, and online
platforms (e.g., e-commerce sites, grocery delivery services).
 Inventory Management: Use of inventory management software to track stock levels,
reduce waste, and manage reordering schedules.

5. FINANCIAL PLAN

Startup Costs:

 Facility Setup: Renovation of production space, purchase of equipment, and initial inventory.
 Marketing and Advertising: Budget for the launch of digital campaigns and in-store promotions.
 Working Capital: Funds to cover operational expenses such as employee salaries,
ingredient sourcing, and distribution costs.

Revenue Projections:

 Year 1: Focus on building brand recognition and distribution partnerships. Projected revenue of
Ksh 650,000, with a modest profit margin.
 Year 2: Expansion of distribution and increased product variety. Projected revenue growth of Ksh
800,000
 Year 3: Stabilization in operations with expanded product lines and retail presence. Profit
margins will increase as economies of scale are achieved.

Cost of Goods Sold (COGS):

 Includes the cost of raw hen meat, seasoning, packaging, labor, and transportation.

Profit and Loss Forecast:

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 Gross Margin: 30-35% after accounting for production costs.

 Net Profit: Expected to break even in the first year, with profits increasing as marketing
efforts pay off and operational efficiency improves.

Funding Requirements: The business will seek an initial investment of Ksh 500,000 to cover startup
costs and working capital requirements. The funds will be allocated towards production equipment,
marketing efforts, and initial stock procurement.

Break-even Analysis: The business expects to break even by the end of Year 1, with increasing
profitability as the brand gains traction and the customer base expands.

Personal saving 150,000/=

Equity bank loan 100,000/=

Family contribution 150,000/=

Friends contribution 100,000/=

Total 500,000/=

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CHAPTER ONE

1.0 BUSINESS DESCRIPTION

Malaika’s Kuku Joint is a food and beverage business that specializes in preparing and serving high-
quality, delicious meals and drinks to its customers. The business aims to offer a diverse menu that caters
to the tastes and preferences of various customer segments, ranging from individuals to institutions and
commercial buyers.

The primary focus of Malaika’s Kuku Joint is on chicken-based dishes, accompanied by a selection of
complementary sides, beverages, and other menu items. The business seeks to provide a unique
dining experience characterized by excellent customer service, hygienic practices, and competitive
pricing.

Core Values

 Quality: Ensuring every meal served meets high standards of taste and freshness.
 Customer Satisfaction: Delivering exceptional service and creating a welcoming atmosphere for all
patrons.
 Affordability: Offering value for money without compromising on quality.
 Community Focus: Building relationships with customers and contributing positively to the
local community.

Objectives

1. To become the go-to destination for delicious chicken meals and beverages in the local area.
2. To achieve a 30% market, share within the first year of operation.
3. To maintain consistent quality in food preparation and customer service.
4. To build a loyal customer base through personalized service and loyalty programs.

1.1 BUSINESS NAME

The name of the business is Malika’s Kuku Joint. The name is derived from Kikuyu

The name of the business will be Malika’s kuku joint. the name is a combination of the proprietor’s name
and the name of the product that the owner will be dealing with in full Malika’s kuku joint. the business
will bear the name because the name is unique for the customers to notice it fast since neighboring frame
are named by ornaments. the owner will stand a better chance of offering quality products professionally
made and repaired

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1.2 MAP LOCATION OF MALAIKA KUKU JOINT

ELDORET TOWN
ROAD

MALAIKAS’S
KUKU JOINT

SOS

BECKY’S HOTEL
FIRST FOOD
RESTAURANT

1.3 LOCATION AND ADDRESS

Malika’s Kuku Joint will be located in a high-traffic area that is easily accessible to customers. The
location will feature a comfortable dining space, a hygienic kitchen, and facilities to cater to both dine-in
and take away customers.

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Business Model

The business will operate on a combination of direct sales and bulk supply to customers, with a focus on:

 Dine-in Services: A cozy and friendly environment for individuals and groups.
 Takeaway Services: Convenient packaging for customers on the go.
 Delivery Services: Partnering with local delivery platforms to reach customers at their doorstep.
 Bulk Orders: Supplying food in large quantities to institutional and commercial customers.

Competitive Advantage

Malika’s Kuku Joint differentiates itself from competitors through:

 Specialization: A menu centered on expertly prepared chicken dishes.

 Affordable Pricing: Competitive prices that cater to a broad demographic.
 Consistency: Maintaining high standards in taste, service, and hygiene.
 Customer Engagement: Building a strong connection with the community through promotions,
events, and partnerships.

MALAIKA’S KUKU JOINT,

P. O BOX 24,30100

ELDORET,

KENYA.

G-email: [email protected]

1.3 OWNERSHIP OF THE BUSINESS

The business is a sole proprietorship form of business organization owned and managed by FILDA
CHELAGAT.

1.4 TYPE OF BUSINESS

Malaika’s Kuku Joint will be registered under the Hotel and Tourism industry, offering food and drinks

1.5 PRODUCT OF SERVICE

The business is to operate by selling products such as potato soup, croutons, roast chicken/ Bread sauce,
braised rice, mixed vegetables, fruit salad and juice each 150/= per person.

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1.6 INDUSTRY
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The business will be under Hospitality, food and Beverage service industry

1.7 JUSTIFICATION OF THE BUSINESS

Malaika’s Kuku Joint will employ qualified personnel who will produce quality products and services to
customers. Being situated along the road, the customers will be in a position to move in and out of the
premises freely.

1.8 BUSINESS GOALS

The business will have short term and long term goals. The goals will be achieved through purchasing
labour saving equipment which save time as well, ensuring smooth working thus reinforcing short term
and long term goals

1.9 ENTRY AND GROWTH STRATEGY

The business intends to employ qualified personnel in all sectors to make the business a success. It will
employ the General Manager and his Deputy, food and Beverage Manager, Marketing and sales Manager,
Head Chef and assistants, storekeeper and security persons.

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CHAPTER TWO

2.0 MARKETING PLAN

The marketing plan outlines how Malaika’s Kuku Joint will attract and retain its customers, the pricing
strategy, and the ways in which it plans to increase its market penetration. This chapter delves into
identifying and targeting different customer segments, estimating the potential market share, and
formulating pricing strategies to achieve competitive advantage.

2.1 CUSTOMERS

A customer is a person or entity that purchases goods or services from a business. Malaika’s Kuku Joint
will target three primary customer categories: individual customers, institutional customers, and
commercial customers. Each of these customer groups will have distinct needs and will be approached
with tailored strategies to ensure satisfaction and repeat business.

2.1.1 INDIVIDUAL CUSTOMERS

Individual customers are the everyday consumers who will purchase products directly from Malaika’s
Kuku Joint for personal consumption. This category includes:

 Locals: Residents of the area who enjoy a quick meal or a regular place for chicken meals
and beverages.
 Tourists: Visitors who want to try local delicacies, especially chicken dishes, as part of their
culinary exploration.
 Professionals/Young Adults: Busy individuals looking for convenient and affordable
meal options during work or study hours.

Marketing Strategy for Individual Customers:

 Promotions and Discounts: Offering meal deals, loyalty cards, and special offers to
encourage repeat visits.
 Convenience: Offering online ordering or delivery services to cater to those who prefer to eat
at home or in their offices.
 Social Media Engagement: Using platforms like Instagram, Facebook, and TikTok to
showcase mouth-watering photos and videos of the menu, engage with customers, and announce
discounts or new menu items.
 Customer Experience: Ensuring a great dining experience through friendly staff, a
clean environment, and fast service.

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2.1.2 INSTITUTIONAL CUSTOMERS
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Institutional customers include businesses, organizations, or institutions that purchase products in bulk
for welfare purposes, such as feeding employees, providing meals for events, or offering meals to
community members. This category could consist of:

 Schools and Colleges: Purchasing chicken meals for students, especially during lunchtime.
 Corporate Offices: Ordering large quantities of food for meetings, staff lunches, or
corporate events.
 Hospitals or Welfare Groups: Organizations that may provide food for their staff or people
in need.

Marketing Strategy for Institutional Customers:

 Bulk Orders: Special pricing and deals for large orders.

 Customized Catering Options: Offering tailored menu packages that can meet the dietary needs
of different organizations or groups.
 Partnerships and Contracts: Establishing long-term agreements with institutions for consistent
supply and discounts on bulk purchases.

2.1.3 COMMERCIAL CUSTOMERS

Commercial customers include wholesalers, retailers, and businesses that purchase products in bulk to
resell them at a profit. This group focuses on businesses looking for reliable sources of chicken products
to stock or sell in other outlets. These customers could be:

 Retail Chains: Supermarkets or small retail shops buying pre-packed chicken or ready-to-cook
meals.
 Restaurants and Cafes: Local eateries sourcing chicken meals or ingredients from Malika’s
Kuku Joint to resell or use in their own dishes.
 Food Delivery Services: Companies that deliver meals to consumers on behalf of restaurants or
food joints.

Marketing Strategy for Commercial Customers:

 Volume Discounts: Offering discounted rates on bulk purchases to encourage large-scale orders.
 Reliable Supply Chain: Ensuring a consistent, high-quality supply of chicken products and
meals to meet the demand of commercial clients.
 Private Labeling or Co-Branding: Offering the option for commercial clients to brand
products with their logo, adding extra value for them.

2.2 MARKET SHARE

Market share refers to the percentage of total sales within an industry that a business controls. The market
share goal for Malika’s Kuku Joint is set at 30% by the end of the first year. This target reflects the early
growth stage of the business, where it will work towards building brand recognition and expanding its

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customer base. Achieving a 30% market share will require a mix of strong customer acquisition
strategies, customer retention efforts, and continued market research.

Market Share Strategy:

 Customer Retention: Ensuring repeat business from individual customers through loyalty
programs, promotions, and consistently high-quality service.
 Aggressive Marketing and Outreach: Increasing visibility through advertising campaigns, local
partnerships, and collaborations.
 Brand Differentiation: Offering unique value propositions such as superior quality,
unique chicken recipes, or healthier alternatives to stand out from competitors in the
market.
 Expansion into New Segments: Tapping into new areas and customer categories like catering for
events or extending to delivery services.

By focusing on these strategies, Malika’s Kuku Joint aims to establish a strong foothold in the market and
build a customer base that will help drive its growth towards achieving the 30% market share target in the
first year of operation.

The market share of the proposed business will be 30% at the end of the 1 st year since the business will be
at the growth stage.

TABLE 4

Market Share

10.00%

MALAIKA’S KUKU JOINT

Becky’s Hotel
50.00% First food Restaurant

40.00%

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Malaika’s Kuku Joint x 3600 = 180%

Becky’s x 3600 = 144%

Fast food restaurant x 3600 = 36%

2.3 COMPETITION
These are people who carry out a similar business within the area and share the market. Below are their
addresses, strengths and weaknesses.

TABLE 3
COMPETITOR’S ADDRESS STRENGTHS WEAKNESSES
Malaika’s Kuku Joint Qualified and Unstandardized prices
P.O BOX 24 experienced Put more concentration
ELDORET Technologically on other businesses advanced Doesn ’t pay
workers
• Operates other on time businesses within
Becky’s Degree in food and Doesn’t recruit new
P.O BOX 576 Beverage staffs from institutions
ELDORET Financially stable fro m Lack of advanced operating
other equipment’s businesses Lack of packin g yard
• Qualified and for custom ers experienced staff
Fast food restaurant Has enough storage Poor payment of
P.O BOX 489 space to store products workers
ELDORET Well-equipped Non- qualified staff i.e. 2
equipment’s and Short working hours’ machines hours
and
• Owner has a Masters Poor location of his in Food
Beverage business
Management Have very few
personnel
• High prices

2.3.1 HOW TO OVERCOME COMPETITORS’ STRENGTHS

The business will consider, recruiting qualified new staff, put the latest technology equipment in use, pay
staff the agreed salaries or wages on time and make the working experience be of more years.

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2.4 ADVERTIZING AND PROMOTION
The business will advertise its services through radio and television stations, posters that will be placed in
strategic positions which the town, local newspapers and magazines as a way of passing information.

The business intends to give its customers free snack as a way of making them come again.

2.5 PRICING STRATEGY

Prices of the products will be determined by complaining to the competitor’s prices and the demand for
the products. As for the start of the business, the proprietor will have a slightly lower price of the products
so as to get more customers.

2.6 SALES TACTICS

The business will try as much as possible to dominate faster in the market which will include direct and
indirect selling.

2.6.1 DIRECT SELLING

The business intends to use advertisement and promotions of the products in order to get targeted market
share whereby, customers will come directly to the establishment, buying from the premises good display,
especially along the cashier’s area.

2.6.2 INDIRECT SELLING

The business will produce cards which will be given to customers. The business cards will contain
business name, address, telephone number and location. This will help customers to book services in
advance.

2.7 DISTRIBUTION STARTEGY

Goods will be produced by the proprietor and then sold to customers through a very short channel of
distribution of producer- consumer as it grows.

TABLE 5
Establishment

Consumers

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CHAPTER THREE

3.0 ORGANIZATIONAL MANAGEMENT PLAN

In the proposed business, the organizational structure will flow downwards from top management to lower
level personnel.

3.1 ORGANIZATIONAL STRUCTURE

TABLE 6

General
Manager

Deputy
manager

Marketing and
Supe rvisor Sales manager

Store
Pastry Chef Cashier Keeper

Assistant
Chefs

3.2 MANAGEMENT PERSONNEL

TABLE 7

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OFFICE HOLDER QUALIFICATION DUTIES
GENERAL MANAGER Degree holder in food and Co-ordinates activities of the
Beverage Management business
41/2 years working experience De cision making Diploma holder in
computer Payment of employee s
science Formulate policies
Good communication skills Employ employees
Holding all matters of the busine ss

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DEPUTY GENERAL Degree holder in food and

MANAGER beverage management
Computer literate
Have a certificate of good
conduct
1 years working experience
Willing to work for long hours
Keep records regarding the business Recruit new employee’s
General supervision of the business

Supervisor Diploma in Hospitality Work for long hours

Management Ensure the snacks are in good 2 yrs. working
experience shape
Computer literate Give orders to
service Aged between 22-30 years’ personnel
Good communication skill
Cashier Have 11/2 experience Collects cash from the 23-28 years
of age customers
C.P.A completion up to level 1 Pays for goods bought by the
Certificate of good conduct business
Pastry Chef Diploma in Food and Prepare menus
Beverage Management Give orders to assistant chefs
2 years’ experience Ensures all snacks on order is
25-40 years of age prepared
Good communication skills
Security man K.C.S.E certificate Ensures maximum security in the premises
Store keeper Must have a certificate in Ordering foods from the purchasing
suppliers
Must be mentally & Issuing goods to the physically fit department
Should be honest Recording goods issued and
Should have experience of at received
least 2 years Keeping the store clean

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Marketing and Sales Manager Have a C.P.A completion up to
level 2 25 years of age
2 years working experience
Ensuring that there is security in the store
Arranging for promotions and advertisement Looking for market
for the service Liaising with the manager on customer needs
Ensure quality products are brought

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3.3 OTHER PERSONNEL
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Head chef Must have at least Organizes kitchen

artisan certificate in departments.
the field. Compiles menu and
Be 30 years old. drinks.
Orders food stuffs.
Head waiter Should have artisan Head of all waiters.
certificate. Making sure this
Should be 19 years old service activities are
and above. running fast and
Should be a female. efficient.
Waiters Should have artisan Deals with customers
certificate. service.
She be 19 years and Ensuring service area
above. is clean and neat.
Stewards Have a work Cleaning utensils and
experience for 3 years. working area.
Have an artisan Manages kitchen
certificate. equipment’s.
Cooks Have a work Preparing all meals
experience for 3 years. and drinks as per the
Have a craft certificate menu.
in this field.
Must be 32 years and
above.

3.4 RECRUITMENT TRAINING AND PROMOTIONS

Malaika’s Kuku Joint will recruit personnel before the start of the business. It will also do onjob and off-
job training and also promote personnel according to staff’ ability and hard work.

3.4.1 RECRUITMENT
Job recruitment will depend on job experience and qualifications. The recruitment will be done by the
proprietor. Job vacancies will be advertised through magazines, newspapers, posters and television.

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Interview is to be conducted at the business premises successful candidates will be contacted and
subjected for orientation in the business by personnel manager.

3.4.2 TRAINING
The owner will send employees to training institutions or alternatively the staff will be trained within the
business premises to get more knowledge.

3.4.3 PROMOTIONS
Employees will be promoted so as to encourage them work more hard and efficiently. This will depend on
one’s hard work and education.

Other factors such as punctuality, behavior and commitment to work towards business growth will also be
an added advantage.

3.5 REMUNERATION AND INCENTIVES

The salary scale for the proposed business will be as follows

TABLE 8
JOB TITLE NO. OF STAFF MONTHLY SALARY ANNUAL SALARY
GENERAL MANAGER 1 SALARY 15,000
ALLOWANCE 5,000 240,000
TOTAL 20,000
DEP. GEN MANAGER 1 SALARY 12,000
ALLOWANCE 3,500 186,000
TOTAL15,500
F&B SUPERVISOR 1 SALARY 10,000
ALLOWANCE 2,500 150,000
TOTAL 12,500
MARKETING 1 SALARY 13,000
MANAGER ALLOWANCE 3000 192,000
TOTAL 16,000
PASTRY CHEF 1 SALARY 9,000
ALLOWANCE 2,000 132,000
TOTAL 11,000
CASHIER 2 SALARY 10,000
ALLOWANCE 2,000 288,000
TOTAL 24,000
ASST. PASTRY CHEF 3 SALARY 8,000 342,000

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ALLOWANCE 1,500
TOTAL 28,500
STOREKEEPER 2 SALARY 7,000 192,000
ALLOWANCE 1,000
TOTAL 16,000
WATCHMAN 2 SALARY 4,000
ALLOWANCE 500 108,000
TOTAL 9,000
TOTAL 1,830,000

3.6 LEGAL REQUIREMENTS

Legal services will be provided by;

MUTULA KASYOKA AND ADVOCATES COMPANY

P.O BOX 2277

ELDORET

3.7 OTHER SERVICES

These are the names of the support services providers

3.7.1 BANK SERVICES

Banking services will be provided by standard characterized bank of Kenya ELDORET branch. The
following is the address of standard Chartered.

STANDARD CHARTERED ELDORET BRANCH

P.O BOX 2492

ELDORET

3.7.3 INSURANCE SERVICES

The business will therefore be insured by;

ICEA INSURANCE COMPANY

P.O BOX 2976

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ELDORET

3.7.4 SECURITY SERVICES

The security firm will be;

SECURITY GROUP AFRICA SERVICES

P.O BOX 999

KAKAMEGA

3.7.5 HEALTH SERVICES

The health services to employees will be offered by;

ELDORET DISTRICT HOSPITAL

P.O BOX 487242

ELDORET

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CHAPTER F0UR
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4.0 OPERATIONAL AND PRODUCTION PLAN

The production equipment and facilities will be acquired within the first week before business operations
starts in order to ensure effective delivery of services.

The business will employ appropriate technology in the business operations and also high conducts so as to
ensure the customers get quality services.

4.1 OPERATIONAL FACILITIES

the equipment requires for production and operation activities will be purchased from suppliers.

The following are equipment to be purchased;

TABLE 9

FACILITY CAPACITY ESTIMATED PRICE PER SOURCE

ITEM
REFRIDGERATOR 3 75,000 NAKUMATT
HOLDINGS
TV 50,000 SONY SHOP
2
COMPUTER 2 80,000 ASTON
COMPUTERS
CHAIRS 6,480 TUSKEYS
72 SUPERMARKET
TOTAL SH. 215,980

4.2 OPERATIONAL AND PRODUCTION STRATEGY

Production effort is based on the quality and level at which it is produced and presented for service hence
sales. The strategy shall maintain control on production and high turn-over expected. These strategies
include;

4.2.1 VOLUME FORECASTING

The amount of products a business can produce by considering the purchased items to sales, helps the
business to obtain accurate information on turnover

4.2.2 PURCHASING SPECIFICATION

To obtain the best materials required, the business shall be in a position to compare several suppliers in
order to come up with a conclusion that supplier ‘A’ supplies quality materials with a better price. This is
important in producing standard items.

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4.2.3 SELLING BY ORDER
Every item leaving the production area shall be on the basis of order. This will help to reduce fraud
because when an order is taken, the top copy goes to the cashier who makes the bill and is handed to the
waiter who takes to the guests, then comes back to the cashier which cash and all the documents are taken
to the control office for comparison.

4.2.4 PLAN LAYOUT OF MALAIKA’S KUKU JOINT

TABLE 10

TOILETS MANAGER’S OFFICE STORE

COOKER
EXIT

KITCHEN
SITTING AREA
OVEN

REFRIDGERATOR

SINK

ENTRANCE COUNTER
SINK

4.3 PRODUCTION PROCESS

The production process of the intended business will be acquisition of goods from suppliers which
customers will be using for the offered services. The service offered to the customer’s satisfaction then the
payment is done.

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4.3.1 TABLE ALLOCATION
lOMoARcPSD| 42749061

Customers will be allocated tables according to his or her own preferences. They will also be allocated
tables according to functions.

4.3.2 USE OF FACILITY

The business will allow its customers to use all the facilities available regardless of their gender, race, age
or status. Customers will also be expected to take care of all the business facilities.

4.3.3 SETTLING BILLS

All guests will be expected to clear their bills before they leave the premises and use the accepted
denominations.

4.3.4 LEAVING THE ESTABLISHMENT

Before the customer leaves, he/ she must be satisfied with the services offered. This will create a come-
back business hence attracting more customers. This will be achieved by the qualified personnel available.

4.4 REGULATIONS AFFECTING PRODUCTION

The business will need to attain all legal requirement documents such as licenses will be required to show
that the business is legally run.

4.4.1 HEALTH REGULATIOS

The ministry of Health will observe hygiene, worker’s health, water supply and give all workers public
health certificate to show that they are able to work with no harm.

5.4.2 SAFETY REGULATIONS

Workers must observe the regulation of the establishment. The ministry of labor will protect the employed
personnel. The business will provide appropriate clothing and equipment to its employees from injury.

4.4.3 ENVIRONMENTAL REGULATIONS

The business will control pollution by digging pits where dirt will be thrown. It will also provide well
ventilated environment for its customers and workers.

4.4.4 WORKMEN COMPENSATION

Through the labour ministry the business will ensure that its employees will be compensated appropriately
and when necessary in case of injury.
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4.4.5 FACTORY ACT
The business will make sure that the workers work in appropriate given working hours, allocate a day off
and one-month leave calculated annually, payment of overtime will also be done.

Workers will also be paid at the end of the month as agreed in the signed contract form.

4.4.6 LICENCES
The intended business will acquire its licenses for operations from ELDORET Municipal Hall.

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 lOMoARcPSD| 42749061

CHAPTER FIVE

5.0 FINANCIAL PLAN

This will deal with calculating the amount that will be needed in the operation and growth of the business
stability and control. The business will ensure appropriate financial management of the business
transaction with the help of balance sheet, income statements and cash flow.

5.1 PRE-OPERATIONAL COSTS

These are the costs incurred before the business starts.

TABLE 11

ITEMS AMOUNTS
License 12,000
Furniture & Fittings 110,000
Uniforms 20,000
Water & Electricity 5,000
Advertisement 5,000
Miscellaneous 10,000
TOTALS 162,000

5.2 WORKING CAPITAL

This is the money which will be able to run the business.

TABLE 12

WORKING CAPITAL FOR THE YEAR COMING 2022

CURRENT ASSETS SH CURRENT SH
LIABILITIES
Cash in Hand 800,000 Bank Overdraft 349,000
Cash at Bank 300,000 Unpaid electricity 38,000

Stock 120,000
Debtors 200,000
Total current Assets 1,420,000 387,000

Net working capital = current assets – current liabilities

= 1,420,000- 387,000

= 1,033,000

5.3 PROFORMA CASH FLOW

This is the Proforma income statement for year 1

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PROFORMA INCOME STATEMENT FOR THE YEAR ENDED DEC 31ST2020
DETAILS AMOUNT
Sales 11,200,000
Less; cost of sales (9,000,000)
Gross profit 2,000,000
EXPENSES
Water bill 40,000
Salaries/wages 800,000
Rent 100,000
Insurance 40,000
Advertisement 15,000
Electricity bill 38,000
Licence 12,000
1,045,000
Net profit before tax 955,000
Net profit after tax 668,500

NET PROFIT = GROSS PROFIT – EXPENSES

(i) Net profit before

tax 2,000,000–1,045,000= 955,000

(ii) Net profit after tax (tax = 30%)

955,000 – (30/100 x 955,000) = 668,500

(iii) Gross profit = sales – cost of sales

11,200,000 - 9,000,000 = 2,000,000

5.4 PROFORMA INCOME STATEMENT

MALAIKA’S KUKU JOINT

BALANCE SHEET

AS AT 1ST JANUARY 20225

FIXED ASSETS CAPITAL

Equipments 397,000 Owner’s contribution 600,000
Furniture and fittings 110,000 Friend’s contribution 100,000
Parents’ contribution 100,000
507,000 800,000
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CURRENT ASSETS
Cash in hand 800,000
Cash at hand 300,000
Stock 120,000
Debtors 200,000

1,420,000

1,927,000
LONG TERM LIABILITY Bank loan
78,000

SHORT – TERM LIABILITIES

Bank Overdraft 349,000

Creditors 100,000
1,049,000

1,927,000

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5.5 BALANCE SHEET
Cash flow = cash inflow- cash outflow = 18,507,000 –13,450,000 = 5,695,000

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5.6 BREAK EVEN ANALYSIS

TABLE 13

Fixed cost Amount

Equipment 397,000
License 12,000
fittings 110,000
519,000
Variable costs
Miscellaneous 10,000
Electricity 38,000
48,000

Total Cost = 519,000 - 48,000 = 471,000

5.6.1 Total Contribution Margin

= sales – variable costs

= 11,200,000 - 48,000

= Sh 11,152,000

5.6.2 Margin Percentage

G.P margin × 100

Sales

2,000,000 × 100

11,200,000

= 17.85 %

5.63 Total fixed cost for year 1

Margin percentage × 100

= 17.85 × 100

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 lOMoARcPSD| 42749061

= 1785 /=

5.6.4 Breakeven Level of Sales In Shillings

= Fixed costs

Total fixed cost for the year 1

= 519,000

1785

= 290.75

5.7 FINANCIAL RATIOS

This is the amount of money needed to start the business
TABLE

ITEM COST
Pre- operational costs 162,000
Working capital 1,033,000
Fixed Assets 507,000
Current Assets 1,420,000
TOTAL 3,122,000

5.8 PROPOSED CAPITALIZATION

TABLE

SOURCE AMOUNT
Owners Equity 600,000
Bank Loan 78,000
Donations 100,000
Contributions (friends) 100,000
TOTAL 878,000
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5.9 DESIRED FINANCING

This is the calculated profitability of the business for the year one.

5.9.1 GROSS PROFIT PERCENTAGE

G.P × 100 = 2,000,000 × 100

S 11,200,000

= 17.85 %

5.9.2 Return on Owner’s Equity Ratio

NET PROFIT AFTER TAX = 668,500 = 1.11

OWNER’S EQUITY 600,000

5.9.3 Return on Loan Ratio
R.L = Net profit after tax

Bank Loan

= 668,500 = 8.57

78,000

5.9.4 Return on Donation Ratio

R.D.R = Net profit after tax

Donation

= 668,500 = 6.68

100,000

5.9.5 Return on Contribution

R.O.C = Net profit after tax

Contribution

= 668,500 = 6.68

100,000

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Appendices
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