Poultry Farming Business Plan

lOMoARcPSD|14679925
BUSINES PLAN ON POULTRY FARMING
Supply chain management (University of Eldoret)
Studocu is not sponsored or endorsed by any college or university

Downloaded by Xolani Mudau (pxmudau@gmail.com)
lOMoARcPSD|14679925
BUSINESS PLAN
NAME OF THE BUSINESS: MKULIMA POULTRY FARM

PRESIDENT: CAREN JEPKOGEI
REG.NO: EDA/196/15
COURSE TITLE: ENTREPRENEURSHIP FOR SMALL BUSINESSES
COURSE CODE: IRD 305
PRESENTED TO UoE SCHOOL OF EDUCATION
SUPERVISOR: DR. MWANGI
DECLARATION
I hereby declare that this Business Plan is my original work with my own efforts, skills and
knowledge and it has never been done or presented by anyone to the University of Eldoret,
School of Education.
Student: Caren Jepkogei
Date: ......................... Sign: .........................
Superior: ......................... Date: .........................

lOMoARcPSD|14679925
DEDICATION
I dedicate this work to my family members, my parents Mr. and Mrs. Mark and my Lecturer,
my course-mates and my friends for their support, ideas and correction during the time I was
conducting my research. God bless them all.
ii

lOMoARcPSD|14679925
ACKNOWLEDGEMENT
I am glad to express my gratitude to God for having guided me through the research period. I
thank my lecturer Too for the endless advice and guidance and my parents Mr. and Mrs. Mark
for the support throughout my research. I thank them too for the financial support and moral
support to the completion of my business plan. May God bless you all.
iii

lOMoARcPSD|14679925
TABLE OF CONTENTS
DECLARATION........................................................................................................................ii
DEDICATION..........................................................................................................................iii
ACKNOWLEDGEMENT........................................................................................................iv
TABLE OF CONTENTS...........................................................................................................v
CHAPTER ONE........................................................................................................................1
1.1 BUSINESS NAME..........................................................................................................1
1.2 MKULIMA POULTRY REARING.................................................................................1
1.3 BUSINESS LOCATION..................................................................................................1
1.4 FORMS OF BUSINESS OWNERSHIP..........................................................................2
1.5 INDUSTRY......................................................................................................................3
1.6 PRODUCT AND SERVICES..........................................................................................3
1.7 OPERATION RESOURCES...........................................................................................4
1.8 MARKET.........................................................................................................................5
1.9 ENTRY AND GROWTH STRATEGY...........................................................................6
1.9.1 Entry Strategy.......................................................................................................................6
1.9.2 Growth Strategy....................................................................................................................7
1.10 SWOT ANALYSIS........................................................................................................8
CHAPTER TWO........................................................................................................................9
2.0 MARKET PLAN..................................................................................................................9
2.1 MARKETING ANALYSIS..............................................................................................9
2.2 TARGET MARKET.........................................................................................................9
2.3 SALES POTENTIALS..................................................................................................10
2.4 PROMOTINAL METHOD............................................................................................11
2.5 MARKET SEGMENTATION........................................................................................11
2.6 MARKET SHARE.........................................................................................................12
2.7 MARKET RESEARCH.................................................................................................14
2.8 DEMAND ANALYSIS..................................................................................................15
2.9 MARKET STRATEGIES..............................................................................................16
2.10 PRICING POLICY......................................................................................................17
CHAPTER THREE..................................................................................................................18
3.0 ORGANISATION AND MANAGEMENT PLAN...........................................................18
3.1 ORGANISATION STRUCTURE..................................................................................18
3.2 KEY MANAGEMENT PERSONNEL..........................................................................19
3.3. RECRUITMENT, TRAINING AND PROMOTION...................................................21
3.3.1 Recruitment........................................................................................................................21
3.3.2 Training...............................................................................................................................24
3.3.3 Promotion...........................................................................................................................24
3.4 RENUMERATION AND INCENTIVES......................................................................25
3.4.1 Incentives............................................................................................................................25
3.4.2 License and Registration.....................................................................................................26
3.4.3 PERMIT.............................................................................................................................26
3.5 B- LAWS........................................................................................................................26
3.5.1 Support Staff.......................................................................................................................26
iv

lOMoARcPSD|14679925
CHAPTER FOUR....................................................................................................................28
4.0 PRODUCTION AND OPERATIONAL PLAN.................................................................28
4.1 PRODUCTION FACILITIES AND CAPACITIES.......................................................28
4.2 PRELIMINARY COST..................................................................................................28
4.3 MONTHLY OPERATIONAL OVERHEADS...............................................................28
4.4 PRODUCTION OPERATION.......................................................................................28
4.4.1 Factors affecting production...............................................................................................29
CHAPTER FIVE......................................................................................................................32
5.0 FINANCIAL PLAN...........................................................................................................32
5.1 PRE-OPERATIONALCOST.........................................................................................32
5.2 WORKING CAPITAL...................................................................................................32
5.2.1 Projected cash flow statements for year 1...........................................................................33
5.2.2 Projected cash flow statement for 2nd year.........................................................................33
5.3 PROFORMA INCOME STATEMENT.........................................................................34
5.4 PROFORMA BALANCE SHEET.................................................................................35
5.5 BREAK EVEN POINT..................................................................................................35
5.5.1 Year 1..................................................................................................................................36
5.5.2 Year 2..................................................................................................................................36
5.5.3 Year 2..................................................................................................................................37
5.5.4 Year 3..................................................................................................................................37
5.6 PROFITBILITY RATIO................................................................................................38
5.7 DESIRED FINANCING................................................................................................38
5.8 PROPOSED CAPITALIZATION..................................................................................38
5.9 APPENDICES................................................................................................................39
Appendix 1: Business Location Map...........................................................................................39
Appendix 2: Pie Chart of Market Shares....................................................................................40
Appendix 3: Organization Structure............................................................................................41

lOMoARcPSD|14679925
CHAPTER ONE
1.1 BUSINESS NAME

The name of proposed business is MKULIMA POULTRY REARING
1.2 MKULIMA POULTRY REARING

P.O.BOX 292,
Kisumu
E MAIL mkulimapoultry@gmail.com
The business operates under owners name.

lOMoARcPSD|14679925
1.3 BUSINESS LOCATION
The proposed business is located at Hall market centre, Seme South Central location, Kombewa Division, Kisumu District and Nyanza Province.
It is suitable next to Kajulu Finlay Tea Eastates.
Reasons why the location is most appropriate
Infrastructure
2

lOMoARcPSD|14679925
The above location chosen has adequate infrastructure for example roads which enable easy transportation of raw materials and even the feeders for the poultry.
Security
The area is well secured since it is located to near the police station which provide maximum security in the area
High Population
The above location has high population of people who buy the products for their use hence creates regular customers.
Competitors
In this location there are few competitors since the business is new in the area.
Climate Condition
The area chosen has favorable climatic condition for the poultry
1.4 FORMS OF BUSINESS OWNERSHIP
The proposed business is sole proprietor type of business ran by MKULIMA POULTRY REARING who is initial owner.
The business intended to propose these factors
Profit
The owner enjoys all the profit in the business unlike the partnership where profit is shared to among the partners
Decision making
In this business decision making is faster as compared to partnership .The owner of the business has not consult anyone
Easy to start
The proposed business is easy to start because it does not require high capital.

lOMoARcPSD|14679925
Ability to start
The owner of the business can able to increase or divert the business to another business if making lose or has many competitors
Capital
It needs little capital to start or operate
1.5 INDUSTRY
The business proposed falls under trade industry whereby products like eggs, will be sold to the potentials customers like students from Kajulu High School,
people around them.
Financial skill
The business will enable to generate income to generate on purpose of more raw materials.
ENTREPRENEURIAL SKILL
The business is read y to take all the risks or is self confident for future oriented.
Technical skill
The business is able to have technical skill to produce quality products for its customers
CAPITAL
The business is able to obtain capital from various sources if well planned.
1.6 PRODUCT AND SERVICES
The business intends to produce various products to its customers
 Manure
 Chicks
 Broilers
4

lOMoARcPSD|14679925
 Eggs
 Gillette
 Layers
It also intend to provide various services to customers
 After sales services
 Transportation
 Packaging
1.7 OPERATION RESOURCES
The business is going to be run with the help physical resources inclusive of which are well contributed, modern poultry hatch with feeding traps, resting side
and electricity provide light and also warm inside the hutch
Financial resources
The business requires capital of one hundred and fifty thousand shillings (150,000) to start.
From which one hundred thousand shillings (100,000) from my own savings.
Human resources
This is done through advertisement for the available vacancies through posters, those interested are required to hand in their application and addressed to the
manager. Thereafter the successful candidates are invited for an interview, and then the best are selected.
Firing and hiring of workers is done by the manager. He or she proposed of business for its new employment mode of paying them salary and the amount.
Infrastructure
The business is located where there is electricity which provides warmth. Also the area is located where there are good roads for easy accessibility of raw
materials.
Raw materials
5

lOMoARcPSD|14679925
Raw materials like feeders are bought from the feeders shop.
1.8 MARKET
The proposed business deals with below customers.
 Students
 Drivers
 Bank workers
 Patients
This is how customers are maintained.
Quality products
The business should provide variable and affordable quality poultry products to the community
Utilize resources
The business should utilized available resources in the area so as to create good relationship with the community.
Technology
The business should introduce and improve on new technology of poultry rearing with cost effective and match with the need of customers.
After sale service
The business should provide after sale service to its potential customers if they bought in large quantity
Free sample

lOMoARcPSD|14679925
The business should provide free sample for its customers in order to attract many customers
1.9 ENTRY AND GROWTH STRATEGY
1.9.1 Entry Strategy
The owner of the business intends to create an impact on the market so that peoples comes and be royal customers in her business.
This is can be done through
Advertisement
The owner of the business advertised its business ad the products or services they offer to customers through radios, television hence this makes the business to
become popular.
Sign post
The owner of business puts sigh post along the road where people or customers can easily reach. This will made its business becomes popular.
Sales promotion
For the business to become popular, the owner of the business should make a lot of sales promotion for example usually uses agricultural shoes of Kenya .This
will give her time to show people the type of poultry she kept and also creates sales.
Publicity
This is the other way of communicating to various public e.g customers
1.9.2 Growth Strategy
Since the business is growing very fast and has the possibility to attract more customerss The business intend to employ the following strategy
Good customer relation
This can be done through publicity. It can enhance good communication between the customers and the owner of business.
Free sample

lOMoARcPSD|14679925
Customers should be given free products to stimulate the trial of a product to increase the sales volume.
Staff development
The owner of the business should create staff development in that staff should have good remuneration.
Negotiation with customers
The owner of the business should know the taste and preference of the customers so as not to bring conflict between them.
Packaging
The owner of the business should pack its products in a good manner. Packaging should be well designed.
1.10 SWOT ANALYSIS

AREA STRENGHTH WEAKNESS OPPORTUNIT THREAT
Y
MANAGEMEN Competence Not adequate Increase selling Demand increase of
T and qualified salary
FINANCE Adequate Remuneration of Able to recruit High demand from
capital workers employees employees
ENVIRONMEN Favorable High Able to expand External factors affect
T environment competition e.g social factor
TECHNOLOGY Apply modern It saves time Most employees are
technology illiterate
SECURITY Adequate Odd working High rate o
security hours
8

lOMoARcPSD|14679925
LOCATION Easy to access More customers competition

RAW High quality More products Less sales
MATERIAL produced produced

lOMoARcPSD|14679925
CHAPTER TWO
2.0 MARKET PLAN
2.1 MARKETING ANALYSIS
The business should introduce its market analysis in terms of customers; this will be analyzed in general perspective which will present various customers.
Individual customers
These are customers who buy products in small quantity. For example, young people like students, workers, drivers etc.
Commercial customers
These are customers who buy products in large quantity for resale e.g. hotels.
Institution customers
These are customers who buy in large quantity but not for sale. E.g. schools hospital e.t.c.
Market analysis will also be done in relation to;
The business intends to analyze its customers in relation to test and preference.
Students or farmers their test is manure since farmers will used manure in their farms.
Commercial customers like hotels their test and preference are eggs, broilers, which they will also sell to their customers.
Institutional customers like hospital their test are eggs, Gillette, manure, broilers. They may also use eggs to give their patients for then to maintain balance diet.
2.2 TARGET MARKET
The business intend to serve the following customers; hospital, school, drivers, workers, banks, policemen and hawkers.
The business intends to employ the following strategies in order to maintain its customers.
10

lOMoARcPSD|14679925
Salesmen
The business intends to use salesmen who can sell the business products in the surrounding.
Promotion
The business intends to use promotion during the time sales have dropped to try to maintain the daily target.
Intermediaries
These are persons who come and buy products from my business and sell them else where.
This is intended to make sure that the products and services reach even the people who are far away from Kombewa.
After sale
The business intends to provide after sales services for its customers who buy in large quantities.
Quality products
The business should provide quality products and affordable prices to its customers
2.3 SALES POTENTIALS
The business intends to increase gradually since it produces quality products.
The business intends to employ the following strategies in order to enhance its increment in sales.
Products
The business intends to produce quality products, good packaging to its customers.
Price
The business should provide fair prices and affordable price to its customers.
11

lOMoARcPSD|14679925
Promotion
The business should carry out several promotion e.g. trade fair exhibition to meet with various customers.
Place
The business should be located where it is easily accessible to people.
2.4 PROMOTINAL METHOD
The business intends to provide the following promotional method.
Posters
Posters are to be placed all over the place and at strategic positions for our customers to get the intended information about the business.
Signboards
It is to be located at a point near the business location at a noticeable place.
Radios
Massage shall be passed to customers by sound and music. It will be appropriate to both illiterate and literate since information will be passed through local
stations.
Internet
Since it is the current technology, it is very interactive and convenient. Emails and face book will be used mostly to customers within Kisumu.
Leaflets
They will contain pictures of business location items produced together with their prices. The leaflets shall be issued randomly along road function, public
places e.t.c.
2.5 MARKET SEGMENTATION
The business intends to serve the following market target for example.
12

lOMoARcPSD|14679925
Workers from nearly tea estates and tea factory are middle level earners. All commercial customers falls under middle level earners, institutional customers
falls under high level these are customers whos purchasing power are relatively high.
The following are market segmentation in relation to the total market segmentation.
Individual customers
Commercial customers
Institutional customers
Percentage market segmentation
Individual customers 200/700×100 =29%
Commercial customers 400/700×100=57%
Institutional customers 100/700×100=14%
2.6 MARKET SHARE
Since the business is growing very fast and has the possibility to attracting more customers.
MITO POULTRY REARING
P.O.BOX 27,
KOMBEWA.
TEL NO 0711245584
E MAIL Michaelotieno@yahoo.com.
HARARA POULTRY REARING
P.O.BOX 4,
KOMBEWA.
13

lOMoARcPSD|14679925
TEL NO 0720332157
E MAIL Harara@yahoo.com
PERFECT POULTRY REARING
P.O.BOX 21,
KOMBEWA.
TEL NO 0712345700
E MAIL Perfect@yahoo.comtotal market segmentation
MITO POULTRY REARING. 100/700*100=14%
HARARA POULTRY REARING.200/700*100=29%
PERFECT POULTRY REARING 85/700*100=12%
MKULIMA POULTRY REARING 315/700*100=45%
14

lOMoARcPSD|14679925
MARKET SHARES
2.7 MARKET RESEARCH
The business intends to use the following procedure in order to conduct its market research.
The business intends to provide its customers who are at Kombewa village with eggs manure e.t.c
The business intend to provide the following products

15

lOMoARcPSD|14679925
Manure to Finlay tea farm and eggs to the hospital, workers, and drivers.
The business intends to engage in different advertisement so as to enable its products to formalize with people.
The business intends to analyze the need of customers through.
Telephone interview
Personal interview
Mail interview
The business will design the following sample which will be distributed to its customers. This will be done through setting many questions relating to
questionnaire designing and research to be carried out.
The business intends to employ the following method in collation data for one to carryout data research must contact the members of the population they are
sample.
Interview
The business intends to carry out interview to its customers in order to know their view and their needs.
Observation
The business intends to observe from its customers what they want.
The business will intend to analyzed services, its customers through providing free transportation, after sale services.
The business will intend to provide quality products, free sample, after sale services, transportation recruitment of other workers to make sure that our
objectives are achieved.
2.8 DEMAND ANALYSIS
The demand of the product will include the population, level of income, taste and preference, cultural, social value. The demand of the product normally goes
hand with hand with seasons,
Level of income
16

lOMoARcPSD|14679925
During first month most people normally have cash hence they purchase.
Population
The business is located where the population is dense because in sparsely population regions the business will not grow but where people are populated the
demand will be high.
Seasons
During end year most of people cultivate their produce, demand usually high because people have cash hence this make people to buy more products.
2.9 MARKET STRATEGIES
“MKULIMA POULTRY REARING has to use different market strategies to meet its goals of profit making. The business is to use agents and retailers who
are to expand and diversify market areas. Agents are to take goods to the customers and explain to them about the products. They are to take goods to the
customers and explain to them about the products also they have to use bicycle for the start. Retailers are to be supplied with goods using the wholesales pick
up, that is, for those who buy in bulk.
THE MKULIMA POULTRY REARING PRODUCTS WILL BE DONE THROUGH THE FOLLOWING CHANNELS
17

lOMoARcPSD|14679925
The business will intends to accrue the following benefit when it uses this channel of distribution.
Direct constant with customers
The business will enable to get their customers problems or needs directly.
Time saving
The business will save time since their customers will be provided with goods from the producer.
Low cost of transportation
This business will not incur a lot of transportation since consumers will be provided with products from producer.
Profit
18

lOMoARcPSD|14679925
The business will ensure a lot of profit since they are the producer hence wholesalers, retailers, and consumers will be buying their products.
2.10 PRICING POLICY
The business intends to determine its pricing strategies in relation to the following
Cost
The business intends to determine its cost of production in relation to its prices
Competitors
When the competitors offer their goods at competitive prices, the business is to also offer competitive prices but not that will lead the business to incur losses.
Government policies
The business intends to set its prices according to government regulations.
19

lOMoARcPSD|14679925
CHAPTER THREE
3.0 ORGANISATION AND MANAGEMENT PLAN
A well defined organization and management plan is essential for the business. The business will b e segmented into various departments and section which will
be steered by various professionals for the above the business will require a well organized structure to enhance the operation.
3.1 ORGANISATION STRUCTURE
MKULIMA POULTRY REARING intend to recruit skilled and semi skill personnel to ensure that production of high quality goods are produced at fair cost
the organization and management stages are illustrated on the chart below
20

lOMoARcPSD|14679925
3.2 KEY MANAGEMENT PERSONNEL
MANAGER
The basic qualification of manager
21

lOMoARcPSD|14679925
O-level certificate with a mean grade of C plus
Holder of a certificate in management or business administration from a recognized institution
K.A.T.C. final certificate
Aged between 25-35 years
RESPONSIBILITIES
Set business goals
Staff training, recruitment and employment
Keeping the business records
Decision maker
Evaluation business activities
SUPERVISOR
QUALIFICATION
Certificate holder of public relation
O-level education with means grade of C- and above
At least 1 year experienced
Aged between 20-28 years
RESPONSIBILITY
Assign duties to his juniors
Ensure duties are carried out as expected
22

lOMoARcPSD|14679925
Ensure safety of property
Know the job himself so as o be able to train other workers
Answerable to the management
OTHER MANAGEMENT PERSONNEL
SALES PERSONNEL
O-level education with means grade of D+ and above
Certificate holder in sales and marketing
At least one year experienced
Aged 18 years and a above
Should be good communicator both English and Kiswahili
DUTIES AND RESPONSBILITIES
Marketing business products
Making the expected returns to the management
Be a good public relations practitioner to the customers
Arrange exhibition and trade fair
Keep records of sales
SURBORDINATES STAFF
RESPONSBILITIES
Feeds the poultry
23

lOMoARcPSD|14679925
Keep watch on any outbreak of diseases
Collect eggs
Carry out defeating where necessary
QUALIFICATION
Able to read and write
Able to administer drugs
Work with fewer supervisors
SECURITY
QUALIFICATION
Able to read and write
Able to communicate in English and Kiswahili
Be strong and muscular
Ready to work odd hour
Should be aged between 23-45 years
DUTIES
Keep the intruders away
Maintain safety of property
Maintain the general security of the premises
Report to the management any way of improving the premises security
24

lOMoARcPSD|14679925
3.3. RECRUITMENT, TRAINING AND PROMOTION
3.3.1 Recruitment
This refers to a process by which Human Resource are introduced
To the organization, this is mainly done to ensure that the right people are recruited and selected for the available post in the business.
The business will follow the following procedure in order to recruit its personnel
Job analysis
The business intends to recruit the following personnel for the available vacancies.e.g. Salesman and security
Job description
The above personnel will be performing the specify task and roles which include salesman
Marketing the business products in various markets
Arranging exhibition and trade fair
Keep records of sales
SECURITY
Will be keeping intruders away
Maintaining safety of property
Maintaining the general security
PERSONS SPECIFICATION
The business intend to employ various personnel but there are required one has to meet
Qualifications for salesman
25

lOMoARcPSD|14679925
 Must have o level education with mean grade of c+
 Certificate in holder in sales
 Must have 2 years working experience
 Should be good communicator both English and Kiswahili
Qualifications for security
 Should be able to read and write
 Should be strong and energetic
 Should be aged between 23-45 years
JOB ADVERTISEMENT
Advertisement for available Vacancies is done through newspapers, those interested are required to hand in their application
APPLICATION FORM
The business intend to require the application form with the following e.g name, logo, letterhead; place at recipient e.t.c
SHORTLISTING OF SUITABLE CANDIDATES
The business intend to shortlist the qualified candidates through advertisement in newspaper
INTERVIEW
The interview will be conducted by the manager of which the prequalified candidate will be aware of the interview date, place and time. The interview will be
face to face interview.
SELECTION
The business intend to choose the most qualified candidate who met all requirement needed for the post
NOTIFICATION FOR THE SUCCESSFUL CANDIDATES

26

lOMoARcPSD|14679925
The qualified candidates will be oriented after which they will be told the to report which will after one week from interview day.
3.3.2 Training
Training of management staff and other employees is to be done so as to improve on the employee performance .JUAD poultry rearing intends to organize
seminars for both its managerial and other staff of efficiency, which is geared to increase the level of accountability and reality.
3.3.3 Promotion
Promotion of workers is based on performance record, discipline, qualifications and hard work.
The following are what determine promotion
COMPETENCE
The most competent workers are to be promoted to the next level from the positions they hold at present
LONG SERVICE AND DEDICATION
Dedication and long service workers are to be promoted in terms of salary increment.
EDUCATION LEVEL
Those who are to have high level of education are also to be promoted to the next post
DISCIPLINE
The most discipline worker should also be promoted of being discipline .
HARDWORK
The most hard work workers also should be promoted in terms of salary increment.
27

lOMoARcPSD|14679925
3.4 RENUMERATION AND INCENTIVES

PERSONEL POS SALAR PER PER TOTAL
T Y MONTH YEAR
MANAGER 1 7,000/= 8,500/= 102,000/= 102,000
SUPERVISOR 1 4,600/= 5.600/= 67,200 67,200/=
SALESMAN 1 4,000/= 4,000/= 48,000/= 48,000/=
SURBODINATE STAFF 1 3,500/= 3,500/= 42,000/= 42,000/=

SECURITY 1 3,000/= 3,000/= 12,000/= 12,000/=
SANITATION 1 3,000/= 3,000/= 12,000/= 12,000/=
TOTAL per month=27,600/= 27,600/= 331,200/= 831,200/=
3.4.1 Incentives
The business intend to motivate its workers either financially or non financially
Free gift
The business intend to give free gift during Christmas and new year to its employees
Democratic work
This should be availed to the employees whereby they can express they can their views and feelings towards the business to the management.
Medical allowance
28

lOMoARcPSD|14679925
The business intend to be giving its employees medical cover provided once per year
LOAN
The business intend to be giving its workers an emergency loan that is to be paid on monthly basis
SALARY
The employees salaries are to be paid on time that is by 30th of every month
3.4.2 License and Registration
The business has to obtain legal requirement before starting its operation from district health officer. The total amount for licensing is ninety thousand four
hundred shillings (19,400/=) per year.
3.4.3 PERMIT
This is a written authority giving permit. the business intend to have permit from district health office for health permit , municipal council on installation of
meter for water consumption and also Kenya power and lighting for electricity.
3.5 B- LAWS
The business intends to set some by laws for its employees;
Contribution to N.H.I.F
Each employ must contribute to N.H.I.F for his /her benefits
Time management
Employees should have time management for the business to run smooth.
Honest
Everyone should be honest to what he /she is assign to do
Hygiene
29

lOMoARcPSD|14679925
The compound should be clean including hatches.
Price control
They will ensure standard pricing of products.
3.5.1 Support Staff
Banking
All the revenues collected from the business will be banked at the SACCO bank. Telephone
Writing of telephone shall be done by the Kenya ports authority so that a good communication network can exist between customers and workers in the
business
Posters services
Their services shall be provided by the postal co-operation of Kenya situated kisumu town
Water services
Water to be used and installed in the business will be piped or channeled from municipal council and the Kenya water service
Electricity
Electricity to be used in the business together with the institution of the electricity meter box shall be carried out by Kenya power and lightning company
kisumu branch.
TOOLS &EQUIPTMENT QUANTITIES SUPPLIERS CASH PER UNIT TOTAL

Layers mash 50 kg Winam agrovet 100 5000
Broilers mash 50 kg Winam agrovet 100 5000
Chick mash 100 kg Sosiet agrovet 50 5000
Feed troughs 6 Sosiet agrovet 300 1800
Water guns 5 Winam agrovet 80 400
Drugs 10 Winam agrovet 200 2000
Egg trays 20 Winam agrovet 30 600
Wire mesh 5 rolls Winam agrovet 1000 5000
30

lOMoARcPSD|14679925
Stationary 10 dozen Sarit bookshop 200 2000

Tables 10 Sosiet carpentry 600 6000
Timber 1000 m Sosiet carpentry 10 1000
Locks and nails 5 kg Sosiet carpentry 200 1000
Sand 1 lorry Sang hardwork 700 700
Iron sheets 30 Sang hard work 300 9000
Cement 50 Sang hardwork 500 2500
Grunnel 1 lorry Madala hardware 5000 5000
Total 89,800
CHAPTER FOUR
4.0 PRODUCTION AND OPERATIONAL PLAN
4.1 PRODUCTION FACILITIES AND CAPACITIES
4.2 PRELIMINARY COST

RAW MATERIAL AMOUNT
Drugs 10,000
Feeds 30,000
Water 1,000
Electricity 3,000
Miscellaneous 2,000
Total 46,000
31

lOMoARcPSD|14679925
4.3 MONTHLY OPERATIONAL OVERHEADS

ITEMS AMOUNT
Registration 1616
Advertising 3000
Postage 1840
License 1616
Telephone 963
Rent 1975
Electricity 133
Water 1267
Banking 50,000
Total 62,412
4.4 PRODUCTION OPERATION

ITEMS AMOUNT
Labour 27,600
Market research 20,000
Tools equipment 89,800
Raw materials 46,000
Overhead expenses 62,412
Miscellaneous 1,000
Total 246,812
PRODUCTION PROCESS
There are operational process that the business venture is realized
To achieve it the business intends to employ the for
Rearing layers
32

lOMoARcPSD|14679925
These are birds kept purposely for the production of eggs. They feed on layers mash and are occasionally given calcium to help digestive system and firm
strong eggshell.
Rearing broilers
These are birds kept for meat. The chicks attain this stage at the 20th -22nd weeks.
They are feed with broilers mash.
Brooding
For the first eight weeks, chicks are confirmed to a well ventilated room with temperature regulated by the person in charge
The temperature is maintained at around 250c to 35c.Chicks at this stage are introduced to growers mash and this increase growth rate and weight.
Incubation
This is the process of production producing chicks using artificial method. The process is done in an incubator. A machine which has its temperature regulated
at 35 during this process eggs are turned after every two hours.
After 21 days, the process is over and chicks come out of the egg .these chicks are one day old to 6 weeks old
Selling
This is the last stage where broilers are supplied with final products according to price quotation through cash payment.
4.4.1 Factors affecting production
Competitors
Many competitors will affect the production in that the owner of the business will have to watch the competitors activities to see if they reduce the market
share and this may be done through aggressive advertising , price reduction of some product hence the business result in to lose
Solution
The business will be located where there are few competitors and produce high quality goods which meet the demand of customers.
Insecurity
33

lOMoARcPSD|14679925
The business intends to have their documents safely kept to avoid pilferages of workers and file their properly.
The business is to be located near a police station to prevent theft.
Political instability
When there is a political instability, the business may not produce good products since there be interruption in the production in that raw materials will not able
to supply in time.
The business should not be located where there is frequently instability
Government policy
Government may enforce new laws, taxes, or policy where such situation will enforce the owner of the business to change the company with the policy which
may affect the production negatively.
REGULATION OF THE BUSINESS
Trade license act
It states that the business logo should not be the same with any other already existing business. This is to make new business to acquire fame.
Public health act
This act provides safely of the workers where by the staff should by physically fit and in good health condition on handle good items. Finger like staff will
require the good certificate.
Employment act
This includes law regarding hiring and fining of employees, overtime pay employee right should be well observed.
34

lOMoARcPSD|14679925
35

lOMoARcPSD|14679925
CHAPTER FIVE
5.0 FINANCIAL PLAN
5.1 PRE-OPERATIONALCOST
DETAIL AMOUNT
Registration 19,392
Advertisement 12,000
Postal services 23,000
Telephone 11,550
Rent 23,700
Water 8,700
Banking 1,000
Insurance 17,064
Total 116,406
5.2 WORKING CAPITAL

ITEMS 1ST YEAR 2ND YAER 3RD YEAR
Banking 100,000 40,000 150,000
Raw materials 46,000 56,000 65,000
Family contribution 10,000 5,000 3,000
Personal saving 500,000 70,000 900,000
Creditor 15,000 10,000 16,000
Total 671,000 885,000 1,134,000
36

lOMoARcPSD|14679925
DETAIL JAN FEB MAR APR MAY JUN JUL AUG SEPT OCT NOV DEC TOTAL
S
Beginnin 1,550,686 1,643,68 1,767,68 1,872,68 1,957,68 2,068,68 2,192,18 2,325,68 2,444,68 2,590,08 2,749,08 2,909,68 26,072,5
g cash 0= 60/= 60/= 60/= 60= 60/= 6/= 60/= 60/= 60/= 60/= 6/= 302/=
B/F
Cash 60,000/0= 70,0000 65,0000 60,0000 70,0000 75,0000 80,0000 85,0000 90,0000 95,0000 100,000 100,000 9500,000
sales /= /= /= /= /= /= /= /= /= 0/= /= /=
Debtors 80,0000/= 90,0000 90,0000 76,0000 80,0000 90,0000 90,0000 800,000 900,000 1000,00 1000,00 100,000 1,060,00
collection /= /= /= /= /= /= /= /= 0/= 0/= /= 00/=
Total 1,690,686 1,803,68 1,922,68 2,002,68 2,107,68 2,233,68 2,362,18 2,490,68 2,624,68 2,785,08 2,949,08 3,109,68 28,086,5
cash flow 0/= 60/= 60/= 60/= 60/= 60/= 60/= 60/= 60/= 60/= 60/= 6/= 320/=
Expenses 10000/= - - - - - - - - - - 1000/= 20000/=
banking
5.2.1 Projected Rent 20000/= 20000/= 20000/= 20000/= 20000/= 20000/= 20000/= 20000/= 20000/= 20000/= 20000/= 2000/= 24,0000/ cash flow statements for ye
=
Wages/sal 30,0000/= 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 30,000/ 360,0000
aries /= /= /= /= /= /= /= /= /= /= = /=
Telephon 10000/= - - 20000/= - - - 50000/= - - - - 80000/=
e
Electricit 5000/= 5000/= 2000/= 30000/= - - 5000/= - 6000/= - 4000/= - 75000/=
y
Advertise 15000/= 10000/= 20000/= - 10000/= 15000/= - 10000/= - 20000/= - 1000/= 11,0000/
ment =
Insurance 40000/= 50000/= 60000/= - 50000/= 40000/= 30000/= - - - 40000/= 5000/= 27,800/=
5.2.2 Projected Loan 50000/= - - 40000/= - 10000/= - 20000/= 10000/= - 10000/= - 14,000/= cash flow
statement for 2nd repaymen
t
year Postage 10000/= 10000/= 70000/= - - 20000/= - 50000/= - 10000/= 10000/= 500/= 18,500/=
DETAILS JAN Water

FEB 10000/=
MAR 10000/=
APR 10000/=
MAY 10000/= JUN
10000/= 10000/=
JUL 10000/=
AUG 10000/=SEPT
10000/= OCT
10000/= NOV
10000/= 1000/=
DEC 12,000/=
TOTAL
Beginning cash 3,073,6860 3,196,0860 3,328,38 3,454,8860 3,584,5860 3,719,4860 3,874,9860 4,044,3860 4,231,186 4428386 4643860 7016860 38,102,132
Miscellan - - - 30000/= - - - - - - - - 3000/=
B/F 60 0 0 0
eous
Cash sales 80,0000 85,0000
Total 900,000
470,000/= 900,000 500,000
360,000 950,000450,000 1000000
390,000 1000,000 360,500
410,500 1100,000460,000 1100,000
340,600 1200000
360000/ 1300000
39,4000 1400000
36,000/ 1,250,0000
487,000/
cash out /= /= /= /= /= /= /= /= = /= = =
Debtors 9000,000 flow
909000 80,0000 800,000 900,000 1000,000 1100,000 1200,000 1300,000 1400000 1500000 1600000 1,340,0000/
collection Balance 1,643,686 1,767,68 1,872,68 1,872,68 2,068,68 2,192,18 232,568 2,444,68 2,590,08 2,749,08 2,909,68 3,073,68 31,156,2
=
Total cash flow 3,243,6860 B/D
3,371,0860 0/=3,498,38 60/=
3,624,886060/=3,769,5860
60/= 60/=
3,919,4860 60/=
4,084,9860 0/= 4,274,3860
60/= 4,471,186
60/= 60/=
4688386 60/=
7443860 6/=
1001686 18
4,069,2130
60 0 0 0
37

lOMoARcPSD|14679925
Expenses - - 10000 - - - - - - 10000/= - - 20000/=

banking
Rent 25000 25000 25000 25000 25000 25000 25000 25000 25000 25000 25000 25000 300,000/=
Wages/salaries 35,0000 35,0000 35,0000 35,0000 35,0000 35,0000 35,0000= 350000 35,0000 350000 350000 350000 4200,000/=
Telephone 10000 - 10000 - 20000 30000 - - - 20000 10000 - 100,000/=
Electricity 6000 5000= - 7000/= - - - 10000/= - 15000 10000 20000 73000/=
Advertisement 20000 15000/= 10000 - 30000 5000/= 4000/= 7000/= 10000 - - 5000 10,6000/=
Insurance 20000 20000 20000 20000/= 20000 20000/= 20000/= 20000= 20000 20000 20000 20000 240,000/=
Loan 10000 - - - 50000 - - 2000/0= - 10000 - 5000 95000/=
repayment
Postage 20000 1000/0= 5000 - - 10000/= 5000= - 10000 - 10000 10000 80000/=
Water 1000 200/= 300 100/= - 500/= 200/= - 1000 - 200 1000 36000/=
Miscellaneous 5000 - 2000 - 6000 - 4000/= - 3000 - - - 20000/=

Total cash out 47,6000 42,7000/= 43,5000 40,3000/= 50,1000 44,5000/= 40,6000/= 432000/= 428000/= 458000 45000 436000 527,6000=
flow
Balance B/D 3,196,0860 3,328,3860 3,454,88 3,584,5860 3,719,4860 3,874,9860 4,044,3860 4,231,1860 44283860 4643860 701,6860 9580860 35,987,532
60 0
5.3 PROFORMA INCOME STATEMENT
ITEMS YEAR 1 YEAR 2 YEAR 3
Sales 9,429,308/= 28,082,532/= 40692130/=

Cost of goods sold 1,000,000/= 950,000/= 1,250,000/=
Gross capital 8,429,308/= 27,132,532/= 9,442,132/=
Expenses - - -
Rent 23700/= 24,000/= 300000/=
Telephone 11550/= 8000/= 10000/=
Salary /wages 331200/= 36,000/= 420000/=
Insurance 17,064/= 27800/= 24000/=
Advertising 12,000/= 11000/= 10600/=
Banking 1000/= 2000/= 2000/=
Water 8700/= 12000/= 3600
38

lOMoARcPSD|14679925
Postage 23000/= 18500/= 8000

Electricity 15,600/= 7500/= 7300
Loan repayment 4500/= 14000/= 9500
Miscellaneous 2000/= 3000/= 2000
Total expenses 449,314 487000/= 527600
Profit before tax 7979994/= 26,645,532/= 41444532
Tax provision 10% 797999/= 26,664,553/= 41414532
Net profit after tax 7181995/= 23,980,979/= 372730788
5.4 PROFORMA BALANCE SHEET
ITEMS YEAR 1 YEAR 2 YEAR 3
ASSETS
CURRENT ASSETS
Cash at hand 50000/= 70000/= 90000/=
Bank loan 1000/= 2000/= 2000/=
Debtors 100,000/= 80000/= 90000/=
Stock of raw materials 46000/= 50000/= 65000/=
Total current assets 197000/= 202000/= 247000/=
FIXED ASSETS
Machinery & equipment 89800/= 90000/= 100000/=
Furniture 2600/= 3000/= 50000/=
39

lOMoARcPSD|14679925
Land 50000/= 50000/= 50000/=

TOTAL FIXED ASSETS 142400/= 143000/= 200000/=
TOTAL ASSETS 339400/= 345000/= 447000/=
LIABILITIES
Creditors 15000/= 100000/= 16000/=
Bank overdraft 184400/= 135000/= 290000/=
TOTAL CURRENT LIABILITIES 179400/= 145000/= 307000/=
Long term liability
Bank loan 100000/= 150000/= 170000/=
Capital employees 50000/= 60000/= 70000/=
TOTAL LONG LIABILITY 150000/= 210000/= 140000/=
TOTAL LIABILITIES 339000/= 345000/= 447000/=
5.5 BREAK EVEN POINT

YEAR 1
TOTAL SALES 9,429,308
Variable Amount
Telephone 11,500
Electricity 15,600
Advertising 12,000
Water 8,700
Loan repayment 4,500
Miscellaneous 2,000
Total 5,4350
Contribution Margin = Total sales - Variable Cost
9429308 54350
= 9374958
Percentage contribution Margin = T.V.C X 100

Total Sales
40

lOMoARcPSD|14679925
54350 X 100
9,429 308
= 0.6%
5.5.1 Year 1
Fixed Asset Amount

Rent 23,700
Wages/Salary 331,200
Insurance 17,064
Banking 1000
Registration 20,000
Total 392,964
Break Even Point = Total Fixed Cost

Contribution Margin %
392964
0.6%
= 65,494,000
5.5.2 Year 2
Variable Amount
Telephone 8000
Electricity 75000
Advertising 11000
Water 12000
Loan repayment 14000
Miscellaneous 3000
41

lOMoARcPSD|14679925
55,500
Contribution Margin = Total sales Variable Cost

= 28,082,532
C.M. % = T.V.C X 100

Total sales
55,500 X 100
28,082,532
= 0.2%
5.5.3 Year 2
Fixed Asset Amount
Rent 24,000
Wages/Salary 36,000
Insurance 27,800
Banking 2,000
Registration 20,000
Total 109,800

109,800
0.2%
= 54,900,000
5.5.4 Year 3
42

lOMoARcPSD|14679925

Variable Amount
Telephone 10,000
Electricity 7,300
Advertising 10,600
Water 3,600
Loan repayment 9,500
Miscellaneous 2,000
43,500
Contribution Margin = Total sales Variable Cost

= 40,691,132 43,000
= 40,649,132
C.M. % = T.V.C X 100

Total sales
43,000 X 100
40692132
= 0.1%
YEAR 3
Fixed Assset Amount

Rent 30,000
Wages/Salary 420,000
Insurance 24,000
Banking 2,000
Registration 20,000
Total 496,000

496,000
0.1%
43

lOMoARcPSD|14679925
= 496,000,000
5.6 PROFITBILITY RATIO
RATIO TYPE YEAR 1 YEAR2 YEAR3

Gross Profit ratio 8,429,308 X 100 27,132,532 X 100 39,449,132 X 100
9,429,308 28,082,532 40,692,132
=89% =96% =97%

Return on Equity 7,181,995 X 100 23,980,979 X 100 372,730,788 X 100
500,000 700,000 900,000
=1436% =3425% =41414%

Return Investment 7,181,995 X 100 23,980,979 X 100 372,730,788 X 100
671,000 885,000 1,134,000
=11070% =2709% =32868%
5.7 DESIRED FINANCING
Items Amount
Items Year 1 Year 2 Year 3
Operation Cost 116,406 116,406 116,406
Working Capital 671,000 885,000 1,113,400
Fixed Cost 392,964 109,800 496,000
Total 1,180,370 1,111,206 1,725,806
5.8 PROPOSED CAPITALIZATION
ITEMS AMOUNT
44

lOMoARcPSD|14679925
Owners contribution 500,000

Family contribution 10,000
Bank loan 100,000
Stock of raw materials 46,000
TOTAL 556,000
5.9 APPENDICES
Appendix 1: Business Location Map
45

lOMoARcPSD|14679925
Appendix 2: Pie Chart of Market Shares
MARKET SHARES
46

lOMoARcPSD|14679925
Appendix 3: Organization Structure
47

lOMoARcPSD|14679925
48

Poultry Farming Business Plan

Uploaded by

Document Information

Original Description:

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Poultry Farming Business Plan

Uploaded by

Copyright:

Available Formats

lOMoARcPSD|14679925

BUSINES PLAN ON POULTRY FARMING

Supply chain management (University of Eldoret)

Studocu is not sponsored or endorsed by any college or university

NAME OF THE BUSINESS: MKULIMA POULTRY FARM

Student: Caren Jepkogei

Date: ......................... Sign: .........................

Superior: ......................... Date: .........................

Downloaded by Xolani Mudau (pxmudau@gmail.com)

Downloaded by Xolani Mudau (pxmudau@gmail.com)

Downloaded by Xolani Mudau (pxmudau@gmail.com)

Downloaded by Xolani Mudau (pxmudau@gmail.com)

Downloaded by Xolani Mudau (pxmudau@gmail.com)

1.1 BUSINESS NAME

1.2 MKULIMA POULTRY REARING

Downloaded by Xolani Mudau (pxmudau@gmail.com)

1.3 BUSINESS LOCATION

It is suitable next to Kajulu Finlay Tea Eastates.

Reasons why the location is most appropriate

Downloaded by Xolani Mudau (pxmudau@gmail.com)

1.4 FORMS OF BUSINESS OWNERSHIP

The business intended to propose these factors

Downloaded by Xolani Mudau (pxmudau@gmail.com)

It needs little capital to start or operate

1.6 PRODUCT AND SERVICES

The business intends to produce various products to its customers

Downloaded by Xolani Mudau (pxmudau@gmail.com)

It also intend to provide various services to customers

 After sales services

1.7 OPERATION RESOURCES

Downloaded by Xolani Mudau (pxmudau@gmail.com)

The proposed business deals with below customers.

This is how customers are maintained.

After sale service

Downloaded by Xolani Mudau (pxmudau@gmail.com)

1.9 ENTRY AND GROWTH STRATEGY

1.9.1 Entry Strategy

This is can be done through

This is the other way of communicating to various public e.g customers

1.9.2 Growth Strategy

Good customer relation

Downloaded by Xolani Mudau (pxmudau@gmail.com)

Negotiation with customers

1.10 SWOT ANALYSIS

Downloaded by Xolani Mudau (pxmudau@gmail.com)

LOCATION Easy to access More customers competition

Downloaded by Xolani Mudau (pxmudau@gmail.com)

2.0 MARKET PLAN

2.1 MARKETING ANALYSIS

Market analysis will also be done in relation to;

2.2 TARGET MARKET

Downloaded by Xolani Mudau (pxmudau@gmail.com)

2.3 SALES POTENTIALS

The business intends to increase gradually since it produces quality products.

Downloaded by Xolani Mudau (pxmudau@gmail.com)

The business should be located where it is easily accessible to people.

2.4 PROMOTINAL METHOD

The business intends to provide the following promotional method.

It is to be located at a point near the business location at a noticeable place.

2.5 MARKET SEGMENTATION

Downloaded by Xolani Mudau (pxmudau@gmail.com)

Percentage market segmentation