BUSSINESS PLAN

HOPE AND UNITY PLUMBING

ACCESSORIES

ADDRESS: PO BOX 82-100, BUKURA

EMAIL: OMUKANGUSTELLA@GMAIL.COM
PHONE NO: 0705556482
CANDIDATE NAME: STELLA OMUKANGU
INDEX NUMBER:
ADM NO:7641
COURSE: CERTIFICATE IN PLUMBING
SUPERVISER NAME: ALEX PICHO
CENTER: SHAMBERERE TECHNICAL TRAINING INSTITUTE
SERIES: NOVEMBER SERIES
PRESENTED TO: KENYA NATIONAL EXAMINATION
COUNCIL FOR THE FULFILMENT
FOR THE AWARD OF CERTIFICATE IN PLUMBING.
DECLARATION
I Stella Omukangu swear that the work presented to KNEC is my original work not copied and
has never been presented to any extermination body for a word of certification.

i
DEDICATION
I complement to Institution that inspired me towards attaining of my goals in school work and in
my general life.

ii
ACKNOWLEDGMENT
I give thanks to my teachers and friends who worked with me, I also appreciate my parents who
helped me in data access and financially.

iii
EXECUTIVE SUMMERY
The proposed name of the business is hope and unity plumbing accessories. The business will
be located in Kakamega county along Sabatia-Mumias road. The main objective of the business
will be selling of plumbing accessories like fittings and pipes of different sizes.

My potential customers will be individuals, local customers and retailers. They will get business
information through advertisements. Under management, the business will comprise of the
manager, supervisors and procurement officers and other supportive members.

The business will require technological machines like computers, telephones, and calculators to
run.
The proposed capital for starting the business will be Ksh. 2850000

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 Table of Contents
DECLARATION...............................................................................................................................................i
DEDICATION.................................................................................................................................................ii
ACKNOWLEDGMENT...................................................................................................................................iii
EXECUTIVE SUMMERY................................................................................................................................iv
CHAPTER ONE..............................................................................................................................................1
1.0 Business Description..........................................................................................................................1
1.1 Business Name...................................................................................................................................1
1.2 Business Location..............................................................................................................................1
1.3 Form of business ownership..............................................................................................................2
1.4 Type of business................................................................................................................................2
1.5 Products and services........................................................................................................................3
1.5.1 Products......................................................................................................................................3
1.5.2 Services................................................................................................................................3
1.6 Justification........................................................................................................................................3
1.7 Goals and objectives of the business.................................................................................................3
1.8 Entry and growth strategy.................................................................................................................3
1.8.1 Entry plan.............................................................................................................................3
1.9 Weakness of the competitors............................................................................................................3
1.10 Growth and strategy........................................................................................................................4
CHAPTER TWO.............................................................................................................................................5
2.0 Marketing plan..................................................................................................................................5
2.1 Market share.....................................................................................................................................5
2.2 Competition.......................................................................................................................................5
2.3 Methods of promotion and advertisement.................................................................................6
2.3.1 Promotion...................................................................................................................................6
2.3.2 Advertisement.....................................................................................................................6
2.4 Prices strategy...................................................................................................................................6
2.5 Sales tactics.......................................................................................................................................6
2.6 Distribution strategy..........................................................................................................................7
CHAPTER THREE..........................................................................................................................................8
3.0 Management Team...........................................................................................................................8
3.1 Other personnel.................................................................................................................................9

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 3.2 Recruitment training and promotion...........................................................................................9
3.2.1 Recruitment................................................................................................................................9
3.2.2 Training................................................................................................................................9
3.3 Promotion..........................................................................................................................................9
3.4 Remuneration and incentives..........................................................................................................10
3.5 Incentives.........................................................................................................................................10
3.6 License, permits and By-laws...........................................................................................................10
3.6.1 License......................................................................................................................................10
3.6.2 Permit................................................................................................................................10
3.6.3 By-law.......................................................................................................................................10
3.7 Support services..............................................................................................................................11
3.8 Banking services..............................................................................................................................11
3.9 Insurance.........................................................................................................................................11
CHAPTER FOUR..........................................................................................................................................12
4.0 PRODUCTION PLAN.........................................................................................................................12
4.1 Production strategy.........................................................................................................................12
4.2 Production process..........................................................................................................................12
4.3 PRODUCTION AFFECTING OPERATION............................................................................................13
4.4 Health regulation.............................................................................................................................13
4.5 Safety regulation..............................................................................................................................13
4.6 Environmental regulations...............................................................................................................13
CHAPTER FIVE............................................................................................................................................14
5.0 FINANCIAL PLAN..............................................................................................................................14
5.1 Pre-operational cost........................................................................................................................14
5.2 Estimation of working capital..........................................................................................................14
5.3 Cash flow projections......................................................................................................................15
5.3.1 Cash flow projection for the year 2021.....................................................................................15
5.3.2 Cash flow projection for the year 2022.....................................................................................15
5.3.3 Cash flow projection for the year 2023.....................................................................................15
5.4 Proforma income statement............................................................................................................15
5.4.1-year 2021..................................................................................................................................15
5.4.2-year 2024..................................................................................................................................16
5.4.3-year 2025..................................................................................................................................17

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5.5 Proforma balance sheet...................................................................................................................18
5.5.3-year 2025..................................................................................................................................18
5.6 Break even analysis..........................................................................................................................19
5.6.1-year 2025..................................................................................................................................19
5.7 Break even analysis..........................................................................................................................19
5.8 Profitability ratios............................................................................................................................19
5.9 Profitability ratios............................................................................................................................19
5.10 Desired financing...........................................................................................................................20

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 CHAPTER ONE

1.0 Business Description

Business deals with selling of plumbing accessories to the customers.
The owner of the business will be manager Stella Omukangu aged 22 yrs. The address will be
omukangustella@gmail.com, single and I acquired education through certificate in plumbing at
Shemberere Technical Training institute.
1.1 Business Name
Hope and unity plumbing accessories.
That means that my business has the hope of gaining customers and many workers operating
together in peace.
LOGO

1.2 Business Location

The proposed business will be located along Sabatia-Mumias Road near Karibu petrol station,
Kakamega county the place is strategic and customers will be able to access materials easily

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1.3 Form of business ownership
The business is of sole proprietorship
Reasons include:

i. The owner enjoys profit alone

ii. The owner can get support from the family members
iii. The owner exercises direct control of the business
iv. Decision making and implementation is first etc.

1.4 Type of business

The business will be started.

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1.5 Products and services
1.5.1 Products
The business will provide fitting G.I and PPR like ¾,1/2 inch and others, different pipes like
green pipes for supplying water, black pipe waste pipes of 4’’ and so on.
1.5.2 Services
The business offers, a wide range of facilities of effective provisions of services and products
like drilling machine, tool book, pipes, fitting, cisterns sinks, tap and water tanks, waste pipes
and many others

1.6 Justification
Reasons for choosing hope and unity plumping accessories is to earn profit, provide services to
customers, to provide local employment to local members.

To expand Kakamega county as a major town

1.7 Goals and objectives of the business

Objectives of the proposed business are:
 To customize customers
 To supply quality plumbing materials
 To earn income generation
 To expand the market
1.8 Entry and growth strategy

The owner will acquire capitalizations, support from family members, proformas, report forms
and requesting a loan from KCB bank for her to start the growth of the business.
1.8.1 Entry plan
The owner of the business enjoys profit alone while the other business profit is shared.
Sole proprietorship exercise direct control of the business while other competitors offer indirect
control.
Formation cost is lower compared to other forms of business which is high.

1.9 Weakness of the competitors

Freedom is not offered to workers

Employees are given salaried employment

3
In other competitors one requires skill.
1.10 Growth and strategy

The business targets a wide range of customers including individual customers and public
institutional customers like Khwisero constituency water project.
The business will advertise its products through local radios on weekly basis, local newspapers
and magazines, different channel of televisions on every Monday to Friday.

4
 CHAPTER TWO

2.0 Marketing plan

The owner of hope and unity plumbing accessories targets a wide range of customers within the
market also institution, public hospitals.
The business will have competition as it continues to grow. The customers will be expecting
high quality of produce from my accessories.

2.1 Market share

The population of the market where hope and unity accessories will be located serves
approximately 300,000 people. The intend of capturing market share of my business lies to 70%

JITAHIDI PLUMBING ENTERPRICE

19 19 MLIMANI PLUMBING ENTERPRICE

HOPE&UNITY PLUMBING

62 ACCESSORIES

2.2 Competition
It is responsible for a business to have a good competition that does not involve to violence and
immorality.
My business competitors entail Mlimani plumbing enterprise and Jitahidi plumbing accessories.

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 Competitors
Mlimani plumbing enterprise
Jitahidi plumbing accessories
Hope and unity plumbing
accessories
Strength Weakness
It is well known by many Goods are sold at high price
people.
Has long working experience.
Has trained personnel
Has been advertising its Has low trained personnel
business through televisions
and newspapers
Has equipped personnel Only takes employees who
It allows cash and m-pesa have experience.
payment methods Have few products to be sold.

2.3 Methods of promotion and advertisement

2.3.1 Promotion
The business offers free packing of quality goods to customers.
The workers will be promoted according to their hard work and respect.
2.3.2 Advertisement
The business will organize on printed calendars called plumbing accessories available. It will
also be advertised in local radios and televisions on every month for two years.

2.4 Prices strategy

The price will be determined by the competitors of the market. It will be affordable to customers.
The hope and unity plumbing accessories would sell its goods at a lower price compared to other
competitors.
2.5 Sales tactics
The business targets a wide range of sales tactics to create awareness of its products.
The business will use direct tactics to the customers. Other customers will request their products
through online order.

6
2.6 Distribution strategy

The business will us its vehicle for transporting goods to customers who purchase high quality of
goods. The daily customers will be offered free transportation.

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 CHAPTER THREE

3.0 Management Team

The management team will comprise of the manager and assistant manager.
The manager will be the owner of the business.
Duties of a manager
 Coordinates all activities in the business
 Staffing
 Controlling the business
 Keeping the business records.
Qualification
 Should be a holder of certificate in plumbing
 Should have good communication skills.
 Should have work experience
Assistant manager
Duties
 Report all activities of the business to the manager.
 Handle customer related issue
 Supervise the operation of the business.
Qualifications
 Certificate holder in marketing
 Computer literate
 Good public relation skills.

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3.1 Other personnel
Are employees who will assist in daily operations of the business like works and cleaners of the
office.
Title Number Qualification Duties and responsibilities

Cleaner 2 Open Cleaning environment

Driver 1 Have a driving license Transportation

Security 2 Have experience Securing goods

Cooks 2 Should have a certificate in Cooking food to employers and

food and beverages employees

3.2 Recruitment training and promotion

3.2.1 Recruitment
Other personnel will be acquired through recruitment and personal conduct which will be based
on level of education, physical capacity and how best the person can relate with customers.
3.2.2 Training
Members will be trained through induction training at the premises. That will be done on the first
week and will enable employees to orient with organization working procedures issues
concerning safety, dressing code will be taught during training.
The business shall also take its employees to further studies within their specialized areas to
enable the organization come up with a better team of professionals who can offer quality
services to customers.
3.3 Promotion
Promotion of employees will be done and even qualifications hardworking employees will be
motivated through promotion.

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3.4 Remuneration and incentives
Title No. Of employees Basic salary Medical allowance Gross pay per
month
Manager 1 10000 4000 14000

Assistant 1 9000 2500 11500

Cleaners 2 8000 2000 10000

Driver 1 5000 1000 6000

Security 2 7000 1500 8500

Cooks 2 4000 2000 6000

Total 7 43000 13000 56000

3.5 Incentives
The hardworking employees will be granted gifts during public holidays. The business will also
offer loans, allowances and paying overtime money in every new month.
Break teat and lunch will also be offered to avoid workers moving out of the premises during
lunch time.
3.6 License, permits and By-laws
3.6.1 License
A license is a legal requirement for the operation of the business will be obtained from
Kakamega county government office.
It will cost Kshs. 9000
The license will be acquired in order to protect the business.
3.6.2 Permit
The certificate registration of the business will be obtained at Kakamega County.
3.6.3 By-law
Kakamega county government by-laws will be strictly followed to avoid conflicts with the
government.
The government will ensure all conditions for the operations of the business are met like:
Waste disposal
Registration of the business

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 Good condition of the business
Health act
3.7 Support services
Are services that ensures smooth running of the business.
3.8 Banking services
The business will operate with Equity bank for saving of money.
The bank will ensure security of business money.
All deposits and withdrawals will be done on this bank. Th bank will also offer loan for the
growth of the business.
3.9 Insurance
Leiston Insurance Company located at Kakamega city Centre will provide services like
Insuring company’s facilities against fire and theft.
Insure company’s vehicle and even staff.
Postal services
The email address that will be used in obtaining business messages will be
omukangustella@gmail.com while the postal address will be P.O BOX 60-100 KAKAMEGA.
Consulting services
The business will require consultants like internal technicians who are known to have plumbing
materials.
Legal services
They will be necessary when drafting legal letters and dealing with labor laws.

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 CHAPTER FOUR
4.0 PRODUCTION PLAN
Production facility and capacity
Hope and unity plumbing accessories will be offering quality standard products according to
customers preferences and taste. Products will be designed and development done in that to
attract many customers.
I will be offering facilities like a computer telephone, pick up, oxy acetylene, furniture, tool box,
calculator, bench shear, workshop, electricity

Item Quantity Cost

Computer 1 4000
Furniture 7 7000
Telephone 2 12000
Electricity 2 phases 9000
Oxy acetylene 2 2000
Pick up 1 80000
Calculator 1 18000
Bench shear 1 1500
Total 18 Shs.133,500

4.1 Production strategy

The business will provide quality goods and services that will be affordable and reliable to the
customers and it will enable maximization of profit.
The management team will be close to monitor the process of service delivery and also welcome
and suggestion from the customers.
Organization will employ competent staff who will enhance operational process.

4.2 Production process

The operation of the business will be from 7:30 am to 5:30 pm from Monday to Friday of every
week.
Their will be high quality of goods to customers in an orderly manner.

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4.3 PRODUCTION AFFECTING OPERATION
It will be both government and local authority.

4.4 Health regulation

The organization will provide NHIF card to all employees in the firm. The employees who will
feel unwell should be treated freely without any charge. Toilets should be cleaned regularly so as
to protect health of customers.
4.5 Safety regulation
There will be fire extinguishers to every corner for the secure of employees whereby they will be
provided by dust coat, helmets, gumboots, gloves and ear muffs for good safety to the workers of
the business.
4.6 Environmental regulations
The environment should be friendly to the workers so as work to be done in a good condition.
The cleaners should clean environment for it to be attractive to customers to buy goods.

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 CHAPTER FIVE
5.0 FINANCIAL PLAN
The financial plan comprises of an analysis of the financial requirements of the business.

5.1 Pre-operational cost

Are costs incurred by the business before it starts costs of acquiring machines and equipment,
fixtures and fittings and renovating the buildings.
ITEM COST (KSHS)

Rent deposit 30000

Advertisement 15000

Recruitment 5000

Licenses 6000

Utility Bills 3500

Insurance 10000

Telephone 2500

Renovations 50000

Machinery 66000

Fixtures and fittings 46000

Total 234000

5.2 Estimation of working capital

Are difference between current assets and liabilities at a given time.
It is the money required to run the business.
Working capital = current assets – current liabilities
Current assets
Stock 25000
Cash at hand 35000
Cash in bank 60000

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Debtors 70000
Total 190000

Current liabilities
Creditors 20000
Bank overdraft 15000
Loan 55000
Total 90000

Working capital = 190000- 90000

100000

5.3 Cash flow projections

5.3.1 Cash flow projection for the year 2021
5.3.2 Cash flow projection for the year 2022
5.3.3 Cash flow projection for the year 2023
5.4 Proforma income statement
5.4.1-year 2021
Sales 6102500
Return sales 100000
Net sales 6002000
Net sales = sales – sales return
Net sales =6002000
Less costs of sales
Opening stock 20000
Purchases 50000
70000
Closing stock 15000
Cost of goods 55000
Available for sales
Gross profit = net sales- cost of goods available for sales
6002500-55000

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Gross profit = 5947500
Expenses
Salary 180000
Electricity 30000
Rent payable 14500
224500
Net profit = gross profit – expenses
5947500-224500
Net profit = 5723000
5.4.2-year 2024
Sales 1886300
Sales return 50000
Net sales 1836300
Net sale = sales – sales return
1836300
Less: less cost of sales
Opening stock 30000
Purchase 45000
75000
Closing stock 20000
Cost of goods 55000
Available for sales
Gross profit = net sales – cost of goods available for sale
1836300-55000
Gross profit = 1781300
Expenses 180000
Salary 50000
Electricity 20000
Rent payable 250000

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Net profit = gross profit – expenses
1781300-250000
Net profit = Shs. 1531300
5.4.3-year 2025
Sales 11522000
Sales return 2000000
Net sales 9522000
Net sale = sales – sales return
1836300
Less: less cost of sales
Opening stock 70000
Purchase 28000
98000
Closing stock 40000
Cost of goods 58000
Available for sales
Gross profit = net sales – cost of goods available for sale
9522000-58000
Gross profit = 9464000
Expenses
Salary 190000
Electricity 50000
Rent payable 10000
250000

Net profit = gross profit – expenses

9464000-250000
Net profit = 9214000

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5.5 Proforma balance sheet
5.5.3-year 2025
Non-current assets
Building 2000000
Land 90000
Machinery 76000
Furniture 35000
Motor vehicle 70000
2271000
Current assets
Stock 1000000
Debtors 2000000
Cash 500000
Bank 500000
4000000
Current liability
Bank overdraft 500000
Creditors 400000
9000000
Net sales
3100000
Total assets
5371000
Financed by
Capital 8000
Net profit 9214000
Less drawing 9222000
Owners’ equity (4000000)
Savings 5222000
Non-current assets liabilities
Bank loan 149000
5371000

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5.6 Break even analysis
5.6.1-year 2025
Break even points= fixed cost/unit
Total salary 1362000/12 =113500
Break even points in shillings
Fixed cost/unit x selling price
Cost of 1kg of nails =6000
1362000/12 x 6000
=shs.681000000
5.7 Break even analysis
Breakeven point in units
Breakeven point = fixed cost/unit cost
Total salary 1625000/12
=Shs. 135416.66667 units
Breakeven point in shillings
Fixed cost/unit x selling price
Cost of 1 kg of nails= 9000
1625000/12 x 9000
=Shs. 1218750000
5.8 Profitability ratios
5.8.1-year 2024
Gross profit ratios
Gross profit/sales x 100
6047500/6202500 x 100
=241900:8481
5.9 Profitability ratios
5.9.1. year 2023
Gross profit ratio
Gross profit/sales x 100
9464000/ 11522000 x 100
=9464:11522
Net profit ratio

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Net profit/sales x 100
9214000/11522000 x 9000
921400:11522
Profitability ratios
Year 2023
Gross profit ratio
Gross profit/ sales x 100
1781300/1886300 x 100
=1781300:18862
Net profit ratio
Net profit/sales x 100
1531300/1886300 x 100
=1531300:18863
5.10 Desired financing
Item Amount

Pre-operational cost 244000

Working capital 75000

Non-current assets

Year 1 2271000

Year 2 2271000

Year 3 2271000

Total 7132000

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5.11 Proposed capitalization
Item Amount
Loan 2700000
Savings 150000
Total 2850000

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