COVER PAGE

THE PROPOSED (BUSINESS NAME)

BUSINESS LOGO
BUSINESS CONTACTS

PRESENTED BY: NAME OF CANDIDATE

INDEX NO:

SUPERVISED BY: NAIROBI TECHNICAL TRAINING INSTITUTE

PRESENTED TO: THE KENYA NATIONAL EXAMINATION

COUNCIL IN PARTIAL FULFILLMENT FOR
THE AWARD OF DIPLOMA IN …………………..

DATE OF PRESENTATION: e.g. NOVEMBER, 2016

 DECLARATION
Declaration by the Candidate

I declare that the business plan is my original work and has never been presented to any
examining body

Name:

Index Number:

Signature:

Date:

Declaration by the Supervisor

I declare that the business plan is forwarded to the Kenya Examination Council with my
approval as the supervisor of the institute.

Name:

Signature:

Date:

(ii)
 DEDICATION

Dedication should be to one or two people at most who have made an impact in your life.

(iii)
 ACKNOWLEDGEMENT
In the acknowledgement page, you may acknowledge everyone who has contributed to your
studies including the institution that you have studied in. The acknowledgement should be in one
paragraph only. The order of acknowledgement should be;

1. The institution
2. Academic Supervisor(s) and Lecturers
3. Financiers if any such as HELB, CDF etc.
4. Parents/guardians and family
5. Friends and colleagues
6. Any other

(iv)
 TABLE OF CONTENTS

Declaration……………………………………………………………………………………… i
Dedication ii
Acknowledgement------------------------------------------------------------------------------------------- iii
List of Figures ----------------------------------------------------------------------------------------------- iv
List of Tables ----------------------------------------------------------------------------------------------- v
Table of Contents ------------------------------------------------------------------------------------------- vi
Executive Summary ----------------------------------------------------------------------------------------
vii

CHAPTER ONE

1.0 Business Description

1.1 The Business Name
1.2 Type of Business
1.3 Products/Services
1.3 Business Location
1.4 Business Ownership
1.5 The Industry
1.6 Entry and Growth Strategy
1.7 The Business Goals

CHAPTER TWO
2.0 The Marketing Plan
2.1
2.2
2.3
2.4
2.5
CHAPTER THREE

3.0 The Management and Organizational Plan

3.1
3.2
3.4

CHAPTER FOUR
4.0 The Production Plan
4.1
4.2
4.3
4.4
4.5
4.6

CHAPTER FIVE
5.0 The Financial Plan
5.1 The Pre-operational Plan
5.2 The Projected Working Capital
5.3 The Pro-Forma Profit and Loss Account
5.4 The Pro-forma Balance Sheet
5.5 The Projected Cash flow Statement
5.6 The Break-Even Point
5.7 The Desired Capital
5.8 The Profitability Ratios

APPENDICES
 LIST OF FIGURES

List all the figures that you have used in the document in the order in which they appear. Figures
include but not limited to, pie-charts, graphs, pictures and photographs, maps etc

(v)
 LIST OF TABLES

List all the tables appearing in the document in the order in which they appear. Examples of
tables are, facilities table in chapter four.
THE EXECUTIVE SUMMARY
(The Executive Summary should not exceed one and a half pages)
1.0 The Business Description

2.0 The Marketing Plan

3.0 The Management and Organizational Plan

4.0 The Production Plan

5.0 The Financial Plan

 CHAPTER ONE

1.0 THE BUSINESS DESCRIPTION

The business description is the first phase of preparing your business plan in which you will;
clearly describe the nature of the business you wish to start, explain in detail the product or
service you will offer, explain the industry in which the proposed business will fall in and also
how you intend to make entry into the market and outline your plans for growth. Finally you
will state the business goals i.e. Short and Long Term Goals that will act as guides for the
business.

1.1 The Business Name

 What will the name of your proposed business be? (Justify the choice of your business
name. It should be memorable, easy to pronounce, unique, attractive, have a link with the
product or service you intend to offer)
1.2 Type of Business
 When do you intend to start your business?
 What will be the major activity of your proposed business?
 Who will be your principal customers?
1.3 Choice of Business Location
 Where exactly the proposed business be located?
 How does your chosen business location relate to the market area within which you wish
to operate?
 What infrastructure exists at your planned business location? (Indicate the availability of
roads, rails, airport, telephone, water and electricity etc.)
 How close is your business location to sources of raw materials, potential markets,
employees’ homes, potential suppliers and other business services?)
1.4 Proposed form of Ownership
 Will your business operate as a sole/proprietor, partnership or limited company? (Justify
the choice of business form)
 How much will you contribute to your business?
 How much do you plan to get from any lending institution
 How much do you expect to get from family and friends as a donation?
 What will be the percentage of each source of capital
1.5 Justifying the need for the Proposed Business Venture (Here use the name of the
business)
 What specific needs will your business venture satisfy? (Consider unsatisfied local
demand; export orientation, import substitution, or potential growth in the industry)
 What contribution will your business make to the local community? (consider
employment creation; use of local resources, promotion of indigenous technology or
provision of goods and services)
 1.6 The Product (Here you need to choose either a product or service. Kindly do not
use both)
 What product will your business offer? e.g XYZ Enterprises will provide the
following services: ……………………………

 What will be the main features of your product or service? (Indicate the size,
color, shape, texture, materials, quality and packaging of the product) e.g. The
products offered will bear the following features: ………………………..

 What benefits will customer obtain from your product or service? (Consider the
performance, convenience, economy, comfort, durability, usage flexibility,
servicing and warranties of the product or service) e.g. The products will meet
customer needs in terms of comfort, flexibility etc. the products will also be
affordable to most of our customers and will be much cheaper than other similar
products in the market.
 What unique features of your product or service will give it advantage over your
competitors? e.g. Our products will have superior quality over those offered by
the competition etc.

1.7 The Industry

1.7.1 Size of the Industry

 Which industry does your proposed business belong to? (Examples of industries;
transport industry; the education sector, manufacturing etc.) E.g. The business will
operate in the transport industry, construction industry etc.
 What is the size of the industry in your proposed business? (Consider the total
number of firms in the industry)

1.7.2 Key Characteristics of the Industry

 What are the sizes of firms in the industry (Indicate whether small, medium, or
large)
 What kind of technology is used in the industry? (Indicate whether it is labour or
capital intensive. Kindly justify)
 What level of technology is applied in the industry? (Indicate whether modern,
obsolete, outdated, sophisticated or simple)
 What is the average number of employees in the firms?
 What is the basic capital requirement for entry to the industry?
 What is the degree of competition in the industry? (Indicate whether low or high)
 What is the general level of sales/profitability for firms operating in the industry?
 What seasonal factors are experienced in the industry?
1.7.3 The Industry Trends and Prospects

 What are the trends and prospects of sales in the industry? (Indicate signs of growth,
stability or decline)
 What the trends and prospects of technological development in the industry?
 What are the competitive trends in the industry? (Consider product innovation,
packaging, pricing etc.)

1.8 The Entry and Growth Strategies

1.8.1 The Entry Strategy

 How will the business penetrate and gain acceptance in the target market? (Consider
advertising and promotion, weaknesses among competitors, competitive advantages,
distribution etc.)

1.8.2 Growth Strategy

 What opportunities will there be for growth in the proposed business

 What are the plans for growth and expansion beyond the entry of the product or service

1.9 Business Goal

E.g. The goal of the business is to provide quality products that meet customer
satisfaction

1.9.1 Short Term Goals (These are mainly oriented towards increasing volume of sales,
market coverage and are action oriented. They should be SMART)

i) e.g have a sales turnover of Ksh. 5m per year in the first two years

ii) Grow the customer base by 10% by the second year of operations

iii)

iv)

1.9.2 Long Term Goals (Growth, expansion, profitability and sustainability oriented goals)

i) Reduce operation and production costs

ii) Expand the product line

iii) Open a second outlet

iv)

v)
 CHAPTER TWO

2.0 THE MARKETING PLAN

The marketing plan is the second stage of preparing your business plan. This phase is highly
critical because it provides the basis for the organizational, operational and financial plans. You
will need to conduct a market research i.e. an in-depth analysis of your market opportunities and
challenges. You can then develop the marketing strategies, tactics and policies required to
exploit the market opportunities. You should note the sources of any market data you use and
present your facts convincingly.

2.1 Customers

2.1.1 Description of Potential Customers

 Who are your potential customers? e.g. The potential customers will fall under two
categories,

i. Individual buyers
ii. Industrial customers ……
 What are the characteristics of your potential customers? (Indicate the customers’ age,
income, sex, education, occupation, and ethnic group where applicable) e.g.….. The
business targets customers between the ages of ……, The business targets low income
earners……etc.
 What will the customers be looking for in your product/service? (Consider
performance, economy, convenience e, comfort, safety or durability) e.g.….The
business will satisfy customers looking for economy, convenience and affordability etc.
 When will the customers purchase your product/service? (Consider time of the day,
week and month) e.g.………The potential customers are expected to make purchases
throughout the year so the business will not suffer from seasonality. This is because our
products are common household commodities.
 What are the purchasing patterns or characteristics of your customers? (Indicate
quantity likely to be purchased at a given time, the frequency of purchase and the
desired mode of payment) e.g…. The potential customers are likely to purchase in small
quantities and therefore are expected to make frequent repeat purchases.

2.1.2 The Market Size

 Approximately how many people (Firms) need your product/service?

 How many units of each good/service do you expect to sell in total each month?

2.2 The Competition

2.2.1 Description of the Potential Competitors

 Who are your potential competitors? ….The potential competitors will be ……. (Names of
the main competitors both direct and indirect)
 Where are your potential competitors in relation to your proposed business location? e.g.
The main competitors are located within 50 meters of our proposed location ………
 How will the location of your competitors affect your business? (State the advantages and
disadvantages of your location in relation to theirs) e.g. …..The close proximity to the
main competitor is advantageous in that the business will get spill-over customers.
Customers seeking personalized service are likely to seek our services.

2.2.2. The Size of Your Competitors in Relation to the Proposed Business

 What sizes are your competitors? Are they small, medium, or large in relation to your
business? (Consider assets, sales volumes, number of employees, etc)
 What are the advantages and disadvantages of the size of your business? e.g. Being a
small business, our business will have an advantage in that; ………The shortcomings of
being small include; ………

2.2.3 Comparison of the Proposed Product with those of Potential Competitors

 How does your product/service compare with those of potential competitors? (For each
area of comparison, give a score on a scale of 1 (very low); 2 (low); 3 (moderate); 4
(High) and 5 (very high). (Consider performance, quality, reputation, after-sales service,
and other areas specific to your business)
 What competitive advantages will your product/service have over those of your
competitors?

2.2.4 Description of the Overall Strengths and Weaknesses of Your Potential Competitors

 How do you assess the overall strengths and weaknesses of your competitors? For each
area of comparison, allocate a score on a scale 1 (very low); 2 (low); 3 (moderate); 4
(high) and 5 (very high). (Consider the benefits to customers, technology, location,
management, distribution channels, and other areas specific to your business)

S/No Name of Strengths Weaknesses Opportunity

Competitor
1. Binu Cash n  Has been in operation  Unreliable  Establish regular
Carry for about 10 years working hours and reliable
 Variety of products  Poor customer working hours
 Constant supply service  Ensure superior
 Has a good  Poor visibility customer service
distribution system from the road  Sell in small
 Sells in wholesale quantities
only
  With reference to your competitors’ overall strengths and weaknesses, in what ways will
it be easy/difficult to compete with them?

2.3 The Pricing Strategy

 How will you calculate the selling price of your product/service?

 What factors will you consider in setting the selling price of your product?
 What will be the selling prices for each of your product/service?
 Will your selling prices be fixed or variable? (Give reasons for your decision)
 What credit terms will suit your product/service?)
 What criteria will you use for determining who gets credit?
 What will be your discounting policy?
 What will you charge for after-sales-services?

2.4 Sales Tactics

 What selling methods will you employ? (Consider, personal selling or selling indirectly
e.g. through an agent)
 If you intend to sell directly to customers, how will you recruit, retain and remunerate
your sales force?

2.5 Advertizing and Promotion Strategy

2.5.1 Advertizing Strategy

 Which advertising media will you use?

 How will you portray your product/service? i.e. what image do you wish to project?
 How often will you advertize? How much will each advertisement cost?
 How will your measure the effectiveness of your advertisements? (Consider increased
sales volume, more enquiries, increased website visits, return buyers etc)

2.5.2 Promotion Strategy

 What promotional campaign will you undertake? (Consider using free product samples or
free introductory services
 Which promotional methods will you employ on a regular basis?
 How much will each method of promotion cost?
 How will you measure the effectiveness of your promotional campaigns?

2.6. Distribution Strategy

 How will you get your product/service to your customers?

 What specific distribution problems do you anticipate?
 How do you plan to solve these problems?
 CHAPTER THREE

3.0 THE ORGANIZATIONAL PLAN

In the organizational plan for the business, you will develop policies for staff development and
human resources management. This will enable you to achieve the efficient processing of goods
or effective performance of services. You will present in detail the job descriptions, employee
evaluations, training and staff compensation plans. You will also indicate the support staff and
support services required for your business.

.9 The Manager

(By virtue of you being the proprietor of the proposed business, you must be a member
of the management team and take up the role of the manager.

3.1.1. Duties and Responsibilities




.10 The Management Team
Who will be members of the management team? e.g. The management team will comprise,
The finance manager, Production and Operations manager etc.

(Below here you need to outline the duties of the other members of the management
team. If your management team is composed of three members then you need to move
up to 3.2.3 as shown below. Note that for the Manager you do not need to indicate
qualifications since this has already been captured in chapter one)

3.2.1 e.g. The Production and Operations manager

Duties and Responsibilities





Qualifications




Remuneration

 What incentives will you give to members of the Management Team?

The above information is summarized in Table 3.1 below:
Table 3.1 Remuneration of the Management Team
Function Remuneration Ksh. Incentives and Benefits
The Manager Ksh. 50,000 p.m.  Transport allowance
 Airtime
 End of year bonus
Production & Operations
Manager

Total Remuneration of the

Management Team
Source: Author (2015)

3.2 The Organizational Structure

(Prepare an organizational structure for your business. You as the owner of the proposed
business must be the Manager. Take note that the senior most position in this proposed
business is you the manager. You must also indicate who is answerable to who by use of
arrows)

3.3 Other Personnel

4) How many other employees will the business require? (Here you need to mention the
functions that will be needed) e.g. Secretary, Production supervisor, Messenger etc

3.3.1. The Production Supervisor

Duties and Responsibilities





Qualifications





Remuneration

NB: List all the other position in the same order

 What incentives will you give to the other personnel?The above information is
summarized in Table 3.2 below:
Table 3.2 Remuneration of the Other Personnel
Function Remuneration Incentives and
Ksh. Benefits
Supervisor Ksh. 15,000 p.m. Lunch

Total Remuneration of the

Other Personnel
Source: Author (2015)

3.4 Evaluation, and Development of Employees

3.4.1 Promotion of Employees

 On what basis will your employees be promoted?

3.4.2 Employee Development

 What are your training plans for your employees?

3.5 Support Services

The proposed business will need the following support services (indicate the names of the
service providers. NB: it should be business to business engagement)

 Banking
 Accounting Legal Postal
 Insurance
 Internet Provider
 Power
 Water
 Security etc

N/B The name and physical location of the service provider must be given in details. You
also need to indicate the cost of each service provider. You must only deal with registered
businesses and avoid dealing with relatives in their capacity as relatives or friends. If you
have to bring them into the business, then do so because of the professional qualification
that they have and could be utilized in the business

The above information is summarized in table 3.3 below:

Table 3.3 Cost of Support Services
Service Provider Location Cost
Kshs
Banking
Accounting
Legal
Management Advisor
Postal
Insurance
Internet
Total Cost of Support Services
Source: Author (2015)
 CHAPTER FOUR

4.0 OPERATIONAL/PRODUCTION PLAN

In the operational phase of business planning, you will describe the facilities, labor, and
overheads required to manufacture your proposed product or render your proposed service. If
you are in the manufacturing business, you will explain the manufacturing process for making
your product. For a service business, you will describe the key processes of offering your
service. In both manufacturing and service industries, you should indicate any regulations,
compliances and approvals that will affect your operations

4.1 Product/Service Design and Development (if you intend to get into manufacturing, then
this section is a must. If not, jump to 4.2)

4.1.1 Description of the Proposed Design and Development

 What will be the design of your proposed product/service?
 How do you intend to develop your proposed product/service?
 What cost will you incur in designing and developing your product/service?
 What kind of technology will you use to manufacture your product/service?
 What level of technology will you apply in manufacturing your product or offering your
service?
 Is your choice of technology the best available? If not, why have you chosen not to use
alternative technology?
 How appropriate is your choice of technology? (Consider simplicity in utilization, cost
effectiveness, flexibility in adoption, efficiency I n production, extent of local availability
or frequency or maintenance)
 What are your immediate plans to cope with changes in technology which will be used in
the proposed business?
 What are your future plans to cope with technological developments which will be used
in your proposed business?

4.2 Production Facilities and Capacity

4.2.1 Description of the Machinery and Equipment needed for Operation/Production
 What Facilities will be needed for operation?
Table 4.1 Facilities Required for Production/Operation
Item Source Cost Per Units Installation Date Total Cost
Unit Ksh. Required Cost Ksh. Required Ksh.

Total Cost of Facilities Required for Operation

Source: Author (2015)
4.2.3 Repairs and Maintenance of Facilities for Operation/ Production
 Who will maintain and repair the facilities for operation?
 Will spare parts for major items be available locally? If they are, who will be your
suppliers?
 If spare parts are not available locally, what importation arrangements will you have to
make?
4.2.4 Features of the Proposed Premises
 Will you be operating from your own or rental premises?
 What will be the terms and conditions of renting the premises?
 Where will you install the machinery and equipment?
 Draw a ground plan for the proposed premises
 Will the premises space allow for future expansions?

4.3 Production/Operation Strategy

4.3.1 Description of Monthly Production/Operation Expenses
 What raw materials (Materials) will you need for production/operation? (Give details of
type, source, quantities and costs frequency required)
Table 4.2 Monthly Production/Operation Expenses
Material Source Frequency Quantity Cost Per Units Total Cost
Unit Ksh. Required Ksh.

Total Cost of Monthly Materials Required for Operation

Source: Author (2015)

 Will the materials be readily available throughout the year? If not, what are your plans to
deal with possible shortages?
 How will the materials be transported to your business? How much will this cost per
month?
4.3.2 Monthly Labor Requirements
 How many direct and indirect employees will you need?
 What will be the total cost of production/operation labor per month? Use the following
calculation:
No of Direct Employees x Monthly Salary =
No of Indirect Employees x Monthly Salary =
Total Cost of Production Labor per Month =

4.3.3 Monthly Production/Operation Expenses

 What will be your monthly production expenses?
Table 4.3 Monthly Production Expenses
Expense Amount
Ksh.

Total Monthly Production Expenses

Source: Author (2015)

4.3.4 The Cost of Production/Operation

 What volume do you expect to produce per day, week, month, quarter or year?
 What will be the production/operation cost per unit?
 What will be the total cost of production/operation in a given period (per day, week,
month, quarter, and year?)
4.4 Production/Operation Process/Service Delivery Process
 What steps will be involved in producing your product. Alternatively, what will be the
main features of offering your proposed service?
 What external factors are likely to affect your production/operation/service delivery
process?
 How do you intend to minimize the impact of these external factors?
4.5 Government Regulations
The proposed business will have to comply with the following government regulations:
 Name Search
 Business Name Registration
 Business Operation License
 PIN Certificate
 Taxation
 Tax Compliance Certificate
The above information is summarized in table 4.4 below:
Table 4:4 Cost of Government Regulations and Compliances
Regulation/Compliance Source Location Cost
Kshs

Total Cost of Government Regulations and Compliances

Source: Author (2015)

CHAPTER FIVE

5.0 THE FINANCIAL PLAN

The chapter describes the financial aspects of a firm. To help gauge the future financial
potential of the firm, the Pro-forma Balance Sheets, Pro-forma Profit and Loss Accounts and a
Projected Cash flow Statement. The chapter also highlights the Financial Requirements and the
Proposed Capitalization. Finally The Break-even Level of Sales and the expected Profitability
Rations have also been calculated
5.1 The Pre-operational Costs
Costs incurred before the operations start

5.1 Pre-operational Costs

Table 5.1 The Pre-operational Plan
Business Details XYZ enterprises
P.O. Box 0000

Item Amount
Ksh
Professional Fees
Facilities
Installation
Deposits
Government Regulations
Advertising
Opening a Bank Account
Fire Extinguishers
First Aid Kit
Uniforms
Partitioning
Office Furniture
Miscellaneous
Total Cost Pre –operational Costs
Source: Author (2014)

5.2 Working Capital

XYZ enterprises
 P.O. Box 0000

Working Capital as at Start-up January 2015; 31 December 2015; 31 December 2016

and 31 December 2017
Assets As at Start-up 31 December 31 December 31 December
Current Assets January 201 201 201 201
Ksh Ksh Ksh Ksh
Debtors - - - -
Cash
Deposits
Total Current Assets
Liabilities
Current Liabilities
Creditors - - - -
Tax
Total Current
Liabilities
Working Capital
(CA-CL)
Source: Author (201
Assumptions:
 Credit sales to be considered after the 3rd year of operation
 Cash as at start up = Capital less Pre-operational costs
 Cash will increase by 10% annually
 Deposits remain constant for the next three years
 Credit purchases to be considered after the 3rd year of operation
 The provision for tax will be 10% of the Net Profit before tax
 Working Capital = Current Assets – Current Liabilities

5.3 Cashflow statement

5.3 The Pro-forma Profit and Loss Accounts
Table 5.3 The Pro-forma Profit and Loss Accounts

XYZ enterprises
P.O. Box 0000

Proforma Trading, Profit and Loss Statements

For the Years Ended 31 December 2018; 31 December 2019 and 31 December 2020
Item 31 December 201 31 December 201 31 December 201
Ksh Ksh Ksh

TOTAL EXPENSES 2 021 899 2 126 199 2 239 004

NET PROFIT BEFORE TAX
PROVISION FOR TAX 10%
NET PROFIT AFTER TAX
Source: Author (201
Assumptions:
 Rent to remain constant for the next three years
 Support services to increase by 10% annually
 Employee Development to increase by 10% annually
 The cost of Advertizing and Promotion to increase by 5% annually
 Salaries to increase by 10% annually
 Office Costs to increase by 5% annually
 Training Levy per trainee remains constant until the government changes
 Office cost will increase by 5% annually
 Direct costs will increase by 10% annually
 Utilities to increase by 10% annually
 Employee incentives to increase by 5% annually
5.4 The Pro-forma Balance Sheets
Table 5.4 The Pro-forma Balance Sheets
XYZ enterprises
P.O. Box 0000

Balance Sheets as at 31 December 2018; 31 December 2019 and 31 December 2020

ITEM 31 December 31 December 31 December
Ksh Ksh Ksh
ASSETS
Fixed Assets (a)
Machinery and Equipment
-Depreciation 10%
NET BOOK VALUE
Office Furniture
-Depreciation
NET BOOK VALUE
Total Fixed Assets (b)
Current Assets
Debtors
Cash
Deposits
Total Current Assets (c)
LIABILITIES
Current Liabilities
Creditors - - -
Tax 10%
Total Current Liabilities (d)
Working Capital
Financed By:
Owners’ Equity
Donation
Bank Loan
Profit/Loss
Total Financing
Source: Author (201
Assumptions:
 Machinery and equipment will depreciate at 10% annually
 Furniture to depreciate at 10% annually
 Credit sales to be considered after the 3rd year of operation
 Cash as at start up = Capital less Pre-operational costs
 Deposits remain constant for the next three years
 Credit purchases to be considered after the 3rd year of operation
 The provision for tax will be 10% of the Net Profit before tax
 Working Capital = Current Assets – Current Liabilities
5.6 The Break Even Analysis
 What will your sales and total direct costs be?
 Calculate the gross profit margin in the following way
Gross Profit Margin= Gross Profit * 100
Sales
 What are the total expenses for 2015?
 What will the break Even level of sales be? Use the following formula:
Break Even Level = Expenses * 100
Gross Profit Margin

5.7 The Expected Profitability Ratios

 What will be the gross profit margin of your business for the first the years 2015; 2016
and 2017?
Gross Profit Margin = Gross Profit x 100
Sales
 What will be the return on equity of your business for the years 2015, 2016 and 2017?
Return on Equity = Net Profit after Tax x 100
Owners’ Equity + Donation

 What will be the return on investment in your business for the years 2015, 2016 and
2017?
Return on Investment = Net Profit after Tax x100
Total Investment
 What do these ratios tell you about the expected profitability of your business?

5.8 Financial Requirements

 How much money will you require at start-up? (Consider Pre-operational Costs, Costs of
Facilities required for operation and miscellaneous.)

Table 5.6 The Financial Requirements

Business Details
Item Amount
Ksh.
Preoperational Costs
Facilities Required for Operation
Miscellaneous
Total Financial Requirements
Source: Author (2014)

5.9 Proposed Capitalization

 What will be the total investment in your business?
 How much of the total investment will you finance? (Owner’s Equity)
 How much do you hope to get from family and friends as a donation?
 How much do you plan to borrow from a lending institution?
 What security will you give? (Consider land title deeds, and other acceptable security)
 What will be your preferred loan repayment terms? (Consider the amount of the loan, the
repayment period, loan interest percentage, grace period and monthly installment)
 What will be the capital for the proposed business?

Table 5.7 The Proposed Capitalization

Business Details
Item Amount
Ksh
Total Investment
Owner’s Equity
Donation from Family and Friends
Bank Loan
Source: Author (2014)