NATIONAL OPEN UNIVERSITY OF NIGERIA

UYO STUDY CENTRE

BUSINESS PLAN FOR THE ESTABLISHMENT OFA LIQUID

SOAP & DETERGENT PRODUCTION COMPANY

BY

JOHN, ITORO PIUS

FACULTY: HEALTH SCIENCE

COURSE TITTLE: BUSINESS CREATION AND GROWTH

COURSE CODE: GST302

MAY 2020
 Detops Cleaning Company

STUDENT PERSONAL DETAILS:

NAME: JOHN, ITORO PIUS

MATRIC NUMBER: NOU181042655

EMAIL ADDRESS: pandagrades@gmail.com

PHONE NUMBER: 07066046354

SEMESTER: 2020/1

SEX: Female

DISABLITY: None

CURRENT PROFESSION: Nursing

PROGRAMME OF STUDY: B.NSc. Nursing Science (New)

FACULTY: Health Science

STUDY CENTRE: Uyo Study Centre

ZONE: South-South

SUSTAINABLE DEVELOPMENT GOAL: Decent work and economic

growth

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TABLE OF CONTENT

1.0 EXECUTIVE SUMMARY

1.1 BUSINESS IDEA
1.2 DESCRIPTION OF THE BUSINESS
1.3 KEYS TO SUCCESS
1.4 CURRENT STATUS OF THE BUSINESS
1.5 POTENTIAL CHALLENGES IN THE SOAP MAKING INDUSTRY
1.6 CONTRIBUTION TO LOCAL AND NATIONAL ECONOMY
1.7 SUSTAINABLE DEVELOPMENT GOAL
1.8 OUR MISSION AND VISION STATEMENT
2.0 BUSINESS STRUCTURE
2.1.1 CHIEF EXECUTIVE OFFICER (OWNER)
2.1.2 PLANT MANAGER
2.1.3 HUMAN RESOURCES AND ADMIN MANAGER
2.1.4 MERCHANDIZE MANAGER
2.1.5 SALES AND MARKETING MANAGER
2.1.6 MACHINE OPERATORS
2.1.7 ACCOUNTANTS / CASHIERS
2.1.8 DISTRIBUTION TRUCK DRIVERS
3.0 SWOT ANALYSIS
3.1 STRENGTH
3.2 WEAKNESS
3.3 OPPORTUNITY
3.4 THREAT
4.0 FINANCIAL PROJECTIONS
4.1 MARKETING PLAN
4.2 FINANCIAL PROJECTIONS AND COSTING
4.3 START-UP BUDGET AND EXPENDITURE
5.0 MARKET ANALYSIS SUMMARY
5.1 MARKET TREND
5.2 TARGET MARKET SEGMENT STRATEGY
5.3 COMPETITION
5.4 MARKETING STRATEGY
5.5 PAYMENT OPTIONS
6.0 FINANCIAL INDICATORS
6.1 SOURCE OF CAPITAL
6.2 FINANCIAL FORECAST AND PROJECTION
6.3 FINANCIAL PROFIT AND LOSS
6.4 GROSS PROFIT
7.0 CONCLUSION

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 Detops Cleaning Company

1.0 EXECUTIVE SUMMARY

Liquid soap as a washing agent is fast replacing detergents in Nigeria. Since the
advent of liquid soap in Nigeria, the detergent producers have not found it easy
copping with the competition. This is because of the simple fact that liquid soap
is fast gaining grounds for laundry and dish washing.
Liquid soap has several advantages over Soaps, hence its preference for laundry
and dish washing. Since the advent of liquid soap in Nigeria, several skill
acquisitions centres have incorporated liquid soap making into their curricula
hence the proliferation of several small-scale liquid soap production companies.

1.1 The Business Idea

Making soap is a creative hobby one can turn into a successful business
because everyone needs soap. Every bar must eventually dissolve, so
every customer can be a steady customer, provided our soap is good. As
with anything else, quality will be the determining factor in the success of
our business. We hope to make good products in order to capture enough
public interest which can make our business to thrive.

1.2 Description of the Business

a. Identity of the Business
The name of the business enterprises shall be Detops Cleaning Company,
a business name registered with state ministry of Commerce and Industry.

b. Business Location
The business is located at No. 15 Afia Nsit, Eket, Akwa Ibom State
Objectives of the Business
The objectives of our cooperative are the following:

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 Promotion of employment opportunities

 Become the specialty soap of choice for restaurants, hotels, schools,

hospitals, and day cares across the state by the end of Year 2.
 Achieve sales of N5 million by the end of Year2.

1.3 Keys to Success

 A branding campaign to build awareness of our products as the standard

for ensuring good washing compliance.
 Consistent education on hand washing and personal hygiene.

1.4 Current Status of the Business

The business is yet to commence operation. It is indeed a start-up
business.

1.5 Potential Challenges in the Soap Making Industry.

In the recent years, we have seen massive changes in this industry, these
changes include:
 New technology
 National Competitive pressures
 Unstable foreign exchange.
 Workers bad attitudes
It has been a challenging time for many enterprises producing soaps.
Competition has been fierce, market shares have been changing rapidly, and
some players have experienced severe financial problems.
1.6 Contribution to Local and National Economy
The following are the benefits and contribution of this business to the economy:
 Employment generation for the teaming unemployed youth in the state.
 The company and staff pay taxes to the government which will increase
government revenue.

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 Improved healthy living and promote longevity among the citizens. A

healthy workforce is a benefit to the economy.

1.7 Sustainable Development Goal

Decent work and economic growth: Aside from generating profits, the
industry has also created jobs in soap making.

1.8 Mission/Vision Statement

Our mission is to create value for customers by continually improving health

and reducing preventable illnesses using our soap.

Our vision is to establish a standard liquid soap production Company whose

products will not only be sold in Eket – Akwa Ibom, but also throughout
Nigeria.

2.0 BUSINESS STRUCTURE

Detops Cleaning Company is established to compete with other leading liquid

soap product brands in the industry. Therefore, we will put the right structure in
place that will support the kind of growth that we have in mind for the business.

We will ensure that we only hire people that are qualified, honest, hardworking,
customer centric and are ready to work to help us build a prosperous business
that will benefit all the stake holders. Profit-sharing arrangement will be made
available to all our senior management staff and it will be based on their
performance for a period of ten years or more depending how fast we meet our
set target.

In view of that, we have decided to hire qualified hands to occupy the following
positions;

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 Chief Executive Officer (Owner)

 Plant Manager
 Human Resources and Admin Manager
 Merchandize Manager
 Sales and Marketing Manager
 Machine Operators
 Accountants / Cashiers
 Distribution Truck Drivers

Roles and Responsibilities

Chief Executive Officer – CEO (Owner):

 Increases management’s effectiveness by recruiting, selecting, orienting,

training, coaching, counseling, and disciplining managers;
communicating values, strategies, and objectives; assigning
accountabilities; planning, monitoring, and appraising job results and
developing incentives
 Responsible for fixing prices and signing business deals
 Responsible for providing direction for the business
 Creates, communicates, and implements the organization’s vision,
mission, and overall direction – i.e. leading the development and
implementation of the overall organization’s strategy
 Responsible for signing checks and documents on behalf of the company
 Evaluates the success of the organization.

Plant Manager

 Responsible for overseeing the smooth running of the production plant

 Maps out strategy that will lead to efficiency amongst workers in the
plant

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 Responsible for training, evaluation and assessment of plant workers

 Ensures operation of equipment by completing preventive maintenance
requirements; calling for repairs.
 Ensures the steady flow of raw chemicals to the plant and easy flow of
finished products through wholesale distributors to the market
 Ensures that the plant always meets the expected safety and health
standards .

Human Resources and Admin Manager

 Responsible for overseeing the smooth running of HR and administrative

tasks for the organization
 Defines job positions for recruitment and managing interviewing process
 Carries out induction for new team members
 Responsible for training, evaluation and assessment of employees
 Oversees the smooth running of the daily office and factory activities.

Merchandize Manager

 Manages vendor relations, market visits, and the ongoing education and
development of the organizations’ buying teams
 Responsible for the purchase of chemicals and packaging materials
 Responsible for planning sales, monitoring inventory, selecting the
merchandise, and writing and pricing orders to vendors

Sales and Marketing Manager

 Identifies, prioritizes, and reaches out to new partners, and business

opportunities et al
 Responsible for supervising implementation, advocate for the customer’s
needs, and communicate with clients

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 Develops, executes and evaluates new plans for expanding sales

 Documents all customer contact and information
 Represents the company in strategic meetings
 Helps to increase sales and growth for the company

Accountant/Cashier

 Responsible for preparing financial reports, budgets, and financial

statements for the organization
 Provides managements with financial analyses, development budgets, and
accounting reports
 Responsible for financial forecasting and risks analysis.
 Performs cash management, general ledger accounting, and financial
reporting
 Responsible for developing and managing financial systems and policies
 Responsible for administering payrolls
 Ensuring compliance with taxation legislation
 Handles all financial transactions for the organization
 Serves as internal auditor for the organization

Client Service Executive

 Welcomes guests and clients by greeting them in person or on the

telephone; answering or directing inquiries.
 Ensures that all contacts with clients (e-mail, walk-In center, SMS or
phone) provides the client with a personalized customer service
experience of the highest level
 Through interaction with clients on the phone, uses every opportunity to
build client’s interest in the company’s products and services

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 Manages administrative duties assigned by the manager in an effective

and timely manner
 Consistently stays abreast of any new information on the company’s
products, promotional campaigns etc. to ensure accurate and helpful
information is supplied to clients
 Receives parcels / documents for the company
 Distributes mails in the organization

Production Workers/Machine Operators:

 Operates the chemical mixer, vessels, crystalizing machines, burner and

conveyor belt system et al.
 Assists in packaging and loading liquid soap products into distribution
trucks

Distribution Truck Drivers

 Assists in loading and unloading liquid soap products

 Maintains a logbook of their driving activities to ensure compliance with
federal regulations governing the rest and work periods for operators.
 Keeps a record of vehicle inspections and make sure the truck is equipped
with safety equipment
 Assists the transport and logistics manager in planning their route
according to a delivery schedule.
 Local-delivery drivers may be required to sell products or services to
stores and businesses on their route
 Inspects vehicles for mechanical and safety issues and perform
preventative maintenance

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 Comply with truck driving rules and regulations (size, weight, route
designations, parking, break periods etc.) as well as with company
policies and procedures
 Collects and verifies delivery instructions
 Reports defects, accidents or violations

3.0 SWOT ANALYSIS

There are several liquid soap manufacturing companies in Nigeria which is why
we are following the due process of establishing a business to compete
favourable with them. We know that if a proper SWOT analysis is conducted
for our business, we will position our business to maximize our strength,
leverage on the opportunities that will be available to us, mitigate our risks and
be equipped to confront our threats.

This is the summary of the SWOT analysis that was conducted our Soap &
Detergent Production Company:

 Strength:

Part of what is going to count as positives for Detops Cleaning Company is the
vast experience of our management team, we have people on board who are
highly experienced on how to grow a business. So also, our closeness to leading
cleaning chemical production companies, large national distribution network
and of course our excellent customer service culture will count as a strong
strength for the business.

 Weakness:

A major weakness that may count against us is the fact that we are a new liquid
soap production company and we don’t have the financial capacity to engage in
the kind of publicity that we intend giving the business.

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 Opportunities:

The opportunities available to liquid soap products manufacturing companies

are enormous because almost all Nigerians make use of liquid soap when
washing. As a result of that, we to position our business to take advantage of the
existing market to create our own new market. We know that it is going to
requires hard work, and we are determined to achieve it.

 Threat:

One of the major threats that we are likely going to face is economic downturn
and unfavourable government policies. Another threat that may likely confront
us is the arrival of a new production company in same location where ours is
located.

4.0 FINANCIAL PROJECTION

Sources of Income

Below are the sources of income, we intend to explore to generate income:

 Selling of liquid soaps

 Home and office delivery of our product

4.1 MARKETING PLAN

A marketing plan is a comprehensive document or blueprint that outlines the
advertising and marketing efforts for the coming year. It describes business
activities involved in accomplishing specific marketing objectives within a set
time frame.

This involves the following:

 Financial data

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 Product data
 Sales and distribution
 Advertising, sales promotion
 Market data

To develop a good market strategy, the following must be put in place:

 The product
 The cost
 The target markets
 The distribution channels
 Advertisement

4.2 FINANCIAL PROJECTIONS AND COSTING

When it comes to calculating the cost of starting a commercial fast food
company, there are some key factors that should be noted. The different type of
dishes to be served determines the total cost of selling the business. The amount
to lease/buy acres land in Akwa Ibom State, the amount equipments and
cooking materials, the amount to pay as salaries to workers, cost of
advertisement in different radio and television stations and how widely accepted
our products are.

4.3 START-UP BUDGET AND EXPENDITURE

The amount /cost will depend on the approach and scale you want to undertake.

The start-up can either be low or high depending on someone goals: vision and
aspiration for the business. The tools and equipment that will be used are nearly
the same cost everywhere.

Below are some basic areas we will spend or start-up capital in setting up our
Restaurant:
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Start-up

Requirements Amount (N)

Registration of the business 50,000

Legal expenses and licenses 35,000

Insurance 40,000

Cost of rented facility for a year 120,000

Operational cost for the first 3 months (salaries of 200,000

employees, payments of bills)

The cost for construction of a standard liquid soap

production plant 250,000

Cost for store equipment (cash register, security,

ventilation, signage) 25,000

Cost of purchase of distribution truck

500,000
Cost of launching a website
50,000
Miscellaneous
10,000
Total Requirements 1,280,000
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Going by the report from detailed research and feasibility studies conducted,
we will need an average sum of N1,280,000

5.0 MARKET ANALYSIS SUMMARY

5.1 Market Trend:

If you are conversant with trends in the industry, you will quite agree that
despite the fact that there are competitions in different stages of the industry,
most liquid soaps production company are leveraging on creativity in terms of
packaging and marketing to continue to stay afloat.

Lastly, our liquid soap company will adopt eco – friendly approach towards the
production and packaging of its products. As a matter of fact, the adoption of
eco-friendly practices will likely persuade environmentally conscious
consumers to buy its products.

5.2 Target Market

When it comes to selling liquid soap, there is indeed a wide range of available
customers. We are in business to engage in wholesale distribution and to retail
our liquid soap to the following groups of people;

 Commercial cleaning companies

 Hotels
 Hospitals
 Laundries and Laundromats
 Household

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Market Segmentation

Commercial cleaning companies

2%
20% Hotels
Hospitals
31%
Laundries and Laundromats
Households
16% Others

8%
24%

5.3 Competition

A quick preview of the industry reveals that the market has become much more
intensely competitive over the last decade. As a matter of fact, you must be
highly creative, customer centric and proactive if you must survive in this
industry. We are aware of the competition and we are prepared to compete
favourably with other liquid soap production companies in Akwa Ibom State.

Part of what is going to count as competitive advantage for us is the vast

experience of our management team. So also, closeness to some of the largest
cleaning chemical manufacturing plants, our large and far reaching national
distribution network and of course our excellent customer service culture will
count as a strong strength for the business.

Lastly, our employees will be well taken care of, and their welfare package will
be among the best within our category in the industry, meaning that they will be
more than willing to build the business with us and help deliver our set goals
and objectives. We will also give good working conditions and commissions to
freelance sales agents that we will recruit from time to time.

5.4 Marketing strategy

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Before choosing a location to start Detops Cleaning Company and the kind of
liquid soap products to produce, we conducted a thorough market survey and
feasibility studies for us to penetrate the available market in our target market
location.

We have detailed information and data that we were able to utilize to structure
our business to attract the number of customers we want and for our products to
favourable compete with other leading brands in Nigeria.

In summary, Detops Cleaning Company will adopt the following sales and
marketing approach to sell our liquid soap;

 Introduce our liquid soap brand by sending introductory letters to

residents, merchants, retailers and other stakeholders in Eket – Akwa
Ibom State
 Engage in roadshows in targeted communities from time to time to sell
our products
 Advertise our products in community-based newspapers, local TV and
radio stations
 List our business and products on yellow pages’ ads (local directories)
 Leverage on the internet to promote our liquid soap brand
 Engage in direct marketing and sales
 Encourage the use of word of mouth marketing (referrals)

5.5 Payment Options

The payment policy adopted by Detops Cleaning Company is all inclusive

because we are quite aware that different customers prefer different payment
options as it suits them but at the same time, we will ensure that we abide by the
financial rules and regulation of Nigeria.

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Here are the payment options that Detops Cleaning Company will make
available to her clients;

 Payment via bank transfer

 Payment with cash
 Payment via credit cards / Point of Sale Machines (POS Machines)
 Payment via online bank transfer
 Payment via check
 Payment via mobile money transfer
 Payment via bank draft

In view of the above, we have chosen banking platforms that will enable our
clients make payment without any stress on their part.

6.0 FINANCIAL INDICATORS

6.1 SOURCE OF CAPITAL
- Personal savings
- Loan

6.2 PROFORMA FORCASTED AND PROJECTION

Proforma forecast is a financial forecast based on income statement, balance
sheet and cash form. This firm is expected to generate 500,000 per week after
the first seven months thereafter maybe more than that as the company gains
popularity with increasing customers.

6.3 PROFORMA PROFIT AND LOSS

EXPENSES
Rent 120,000
Equipment/Expenses 960,000
Personnel Salary 200,000

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PROFORMA PROFIT AND LOSS

year1 year2 year3

Gross profit 4,200,000 6,000,000 7,500,000

Expenses 1,280,000 1,500,000 1,000,000

Net profit 2,920,020 4,500,000 6,500,000

7.0 CONCLUSION

This business project will to be helpful to all. We were able to plan and we’re
looking forward to executing a business though with little profit at first. From
the report, we have learnt a lot about the process of starting up a business. We
gained a lot of experience how to handle the business as well as the operation
and what a business must undergo to become successful by conducting this
report. In addition, we have also learnt about the risk we have to face and how
to overcome the risks. Through perseverance and hard work, we were
successful to achieve our budget.

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