DEPARTMENT OF FORESTERY

BUSINESS PLAN ON BEDELE BEAUTY COSMOTICS SALON FOR MEN

AND WOME

GROUP 1

NAME ID NO
1. MEKUANINT LEGESE………………1204/11
2. JEMAL MUHE ……………………....1258/11
3. ASTER YOSEP…………………….......1186/11
4. ENDIRS FETENE…………………….1340/11
5. TENA BITEW ……..............................0416/11

MARCH, 2021
BEDELE ETHIOPIA
SUMITED T0; AHIMED UMER (M.Sc.IN ABVM)

ADRESS BUNNO BEDELE

Name and Address of the Business

The name of the enterprise is: BEDELE BEAUTY COSMOTICS SALON FOR MEN AND
WOMEN
Address: Bedele town
P.O. Box: 793
Mobile: +251912423344
E-mail: www.hbc.com
Their address is found in Bedele
MOBILE PHONE+ 251912423344
Table of Contents
TABLE OF CONTENT.......................................................................................................................................iv
1. EXECUTIVE SUMMARY.....................................................................................................................1
1.1. Key Success............................................................................................................................................... 2
1.2. Nature of the Company..............................................................................................................................2
1.3. Statement of Financial Need......................................................................................................................2
2. DESCRIPTION OF THE VENTURE..............................................................................................................3
2.1 vision Of the Venture..................................................................................................................................3
2.2 company Mission Statement.......................................................................................................................3
2.3 Objective of the Venture.............................................................................................................................3
2.3.1 Short Term Objective...............................................................................................................................3
2.3.2 Long Term Objective...............................................................................................................................4
3. PRODUCT AND LOCATION.........................................................................................................................4
3.1 Product.......................................................................................................................................................4
3.2 Location......................................................................................................................................................4
3.3 Background of the Partners........................................................................................................................5
4. MARKET ANALYSIS.....................................................................................................................................5
4.1 Over All Market..........................................................................................................................................5
4.2 Specific Market...........................................................................................................................................5
4.3 Competitors Analysis..................................................................................................................................5
4.4 Market Segmentation..................................................................................................................................5
5. PRODUCTION................................................................................................................................................ 6
51 Production Process..................................................................................................................................... 6
5.2 Resource Requirement................................................................................................................................6
5.3 Quality Assurance......................................................................................................................................6
6. ANALYSIS OF COMPETITORS....................................................................................................................6
 6.1 Competitive Advantage...............................................................................................................................7
7. SWOT ANALYSIS..........................................................................................................................................7
7.1 Strength...................................................................................................................................................... 7
7.2 Threat......................................................................................................................................................... 7
7.3 Opportunity7
7.4 Weakness....................................................................................................................................................8

8. ORGANIZATIONAL PLAN...........................................................................................................................8
8.1 Organizational Structure And Venture Holder...........................................................................................8
8.2 Forms of Ownership...................................................................................................................................8
8.3 Manager’s Profile......................................................................................................................................8
9. MARKETING PLAN.......................................................................................................................................9
9.1 Demand and Supply Analysis.....................................................................................................................9
9.2 Pricing Strategy..........................................................................................................................................9
9.3 Promotion...................................................................................................................................................9
9.4 Distribution Strategy................................................................................................................................10
10. FINANCIAL PLAN.....................................................................................................................................10
10.1 Financial Statement................................................................................................................................10
10. 2 Finance Resources.................................................................................................................................12
10.3 Financial Strategy..................................................................................................................................13
10.4 Assessment Of Risk And Contingency.....................................................................................................13
10.4.1 Risk......................................................................................................................................................13
10.4.2 Contingency Plan................................................................................................................................13
11. Break-even analyis....................................................................................................................................... 14
12. Appendix …………………………………………………………………………………………………15
1. EXECUTIVE SUMMARY

1.1 Occurrence
The Bedele Beauty cosmetics enterprise offer high quality and quantity cosmetics for users and
customers. The product of the business will be available for sale at home and also sold to
wholesalers and retailers who sells in other markets. The price set by the business, is fair market
price or it should not exploit customers or should not annoy customers. So that customers are
willing to pay. Cosmetics providing enterprises will provide its product at market price by
identifying and listing each type of cosmetics with their fair prices.
The activities included in this business are purchasing high quality and modernized cosmetics
and preparing store houses where cosmetics stored whenever there is excess supply of cosmetics,
auditing daily sales of business, etc.
The overall objective of the business is to provide high quality and quantity cosmetics in order to
get the expected profit and to satisfy the consumer and to achieve and exceed sales forecasts to
enable us to be operating at capacity, we would also have a claim to create job opportunity,
providing complementary and with cosmetics and plans to expand the business in different area
and also to expand the initial business in size.
In the first year the business forecast a profit of birr 22,028. The reason for obtaining such
positive gaining or profit can be mainly attributed to;
 The profitability of the industry
 The presence of good market price
 Absence of strong competitors due to economies of scale
 Usage of few permanent workers
 Absence of payment for suppliers (transportation cost)

In the second year and third year we expect and predict that there will be increment of profit due
to further increases in sales. The overall objectives of the business are firstly to achieve and
exceed sales forecasts to enable the business to be operating at capacity, so that the business
extended the number of types of modern cosmetics that enables the business to meet (supply) the

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market demand. We would also claim to be able to employ to have in future and expanding the
existing one.
The Bedele Beauty Cosmetics business cosmetic providing enterprise will require loan of birr
30,000 to be repaid over six years. The contribution made for the business is equal for each
partner ands share of profits and loses also can be equally shared. With fund (debt) the business
will cover, house. (Store house), shelf, bulk containers advertising and selling costs.
The Bedele Beauty Cosmetics is also available on www.hbc.com always and ready to accept its
customer’s comments, suggestions and questions regarding the quality of its products and
services.

1.1 Nature of the company

Focuses on Our company preliminary providing high quality and quantity cosmetics in order to
get the expected profit and to satisfy the consumer and to achieve and exceed sales forecasts to
enable us to be operating at capacity, we would also have a claim to create job opportunity,
providing complementary and with cosmetics and plans to expand the business in different area
and also to expand the initial business in size. Bedele Beauty Cosmetics Salon is established is to
solve the problem of cosmetics in Bedele town and help the growth of town. The consumers are
coming to purchase are either for whole sale or retail consumptions activities. The nature of the
company is not only providing cosmetics but also gives whole sale and retail service.

1.2 Statement of Financial Need

Bedele Beauty Cosmetics enterprise planned to construct and establish a company with capital
of 111,520 birr. The business requires means of acquiring this initial capital by borrowing from
financial institution, personal capital and from close relatives.
1.3 Key Success.
.It uses different types of incentives or inducement mechanism to attract other customers
.Continuous auditing of our sales and adjusting our expenditure
.It stands for the welfare and common good of the society for instance, cost minimization
. Absence of payment for supplier

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2 GENERAL COMPANY DESCRIPTIONS
The modern home style cosmetics will be located 500m Jima bar. The cosmetics will be wolly
owned and operated by meseret and buze.

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2.1 Name of the company

The Name Of The Company Is Beauty Cosmetics Salon . Beauty Cosmetics processing is
located in Bedele town. This location is a great opportunity to get different kinds of customers
from Bedele town society.

2.2 Product

The Cosmotics beuaty salon will features international dishes ,an electric ambiance, and
superior service. The hair cream will be of the linest quality and prepared with exotic flare.
Customers sastisfactin is the driving force behind our success. There will be change the menu
ever 5 months, but maintain the favorites for loyal patrons. The product of the business is
industrial product. So any firms who has the potential and licensed by the government can
undertaken the activities.

2.3 location

The business is located in Oromia Region, West Bedele Zone town. The twon is found around
487 KM far from Addis Ababa. The business area is found just back of Bedele Campus around 8
KM from our Compus.

The 3,400 square foot beauty cosmotics will be located in roads shopping center,a retail strip
center located in the Jima bar. The beauty cosmotics is located in a major traffic area,at the
intersection of camp Bowie and cherry road.

2.4 Background of the partner

The partners are a Forestry students . As the Forestry students, they are interested in beauty
cosmetics salon supply business leadership.

For the past 10 years, meseret and buze have been catering part time. Their home sytle menu is
very popular with family reunions. more often not, the couple gets asked to open a beuaty
cosmotics salon full time so that patrons can return again and again. The manager of the
business has much experience in the field the age of student's entrepreneur is between 16 and 18.
The special ability of the manager possess is that she can work with other strongly.

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3. VISION, MISSION AND OBJECTIVES OF THE
BUSINESS
3.1Company Mission Statement
 Utilizing available resources, and providing the society wit due service
 Adopting to the dynamic environment throughout the operation
 Providing affordable living standard to its workers
 Supplying high quality cosmetics suitable for bodies.

3.2 Company Vision Statement

Our business vision is to be well known and preferred cosmetics in Bedele town and to
expanding our business by starting different service 2021.

3.3 Objective of the Company

 To maximize cosmetics supply in general and satisfy consumers consumption
requirement in particular
 To him consumers expenditure for transportation cost
 To creating employment opportunity to the surrounding community
 To provide the customer with high quality and quantity cosmetics.
 To generate profit or at least minimize the loss as a startup business
 The creations of modelist, innovative,unique environment that will differentiate us from
other local cosmetics venture.
 Creating a brand name in our service in the locality by our clarity and amusement in our
Service.
 Increasing the number customers in the future by 50%
 Increasing profit by 50% in the future.
3.3.1 Short Term Objective
. To solve the problem of scarcity of the beauty cosmetics
. To serve who are the main Customers
. To promote the Venture

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Our short term goal of the business is to provide high quality and quantity Cosmetics in order to
get the expected profit and to satisfy the consumer and to achieve and exceed sales forecast to
enable us to be operating at capacity. We would also have a claim to create job opportunity,
providing complementary and with Cosmetics and plans to expand the business in different area
and also to expand the initial business in size.

3.3.2 Long Term Objective

Our long term goal is to hire team members that are truly hand selected and have the same honest
to goodness family values we do. And unlike our big chain competitors, because of our Lean
size, we can turn on a dime when economically pushed and make changes quickly allowing us to
be profitable.
To gain profit by exploiting the market
. To create job opportunity for others
. To own wide Cosmotics processing land
. To compete both by product quality and by price
. To increase the number of Cosmotics and expand the overall structure of the business
. To diversify the special of Cosmotics to have different quality products

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4. MARKET ANALYSIS

4.1 Over All Market

The beauty Cosmetics products are highly demanded. Even though rural part of Ethiopia is self
sufficient in production and consumption, these products are highly demanded by urban
population of Ethiopia. Especially Addis Ababa is the promising market for this product.

The overall economic impact of the beauty Cosmetics salon industry is expected to exceed$1.2
million in 2011. On a typical day in Bedele in 2010 , more than 80 thousand people will be
beauty Cosmetics salon service patrons. Bedele beauty Cosmetics salon industry include about
42,000 beauty Cosmetics with combined annual revenue of about'$300 million. major Company
include Dabo Bar and Jima bar.

4.2 Specific Market

The opening of beauty Cosmetics processing company three years ago creates great opportunity
for mixed farmers who have one or two salon. Therefore The market for beauty Cosmetics
production in the surrounding of the residence of the business is highly promising.

The Bedele beauty Cosmetics salon includes about 380,000 beauty cosmetics salon with
combined annual revenue of about $300.

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4.3 Competitors Analysis

Unless the market is monopolized there is completion with different degrees in any market.
Since the market can swallow the supplies from different individual suppliers, completion is not
the current challenge of the business. However, following the business profitability condition we
expect stiff resistance from new coming business in the area. But this would not also be a threat
because we will be predominant huge competitors of the beauty Cosmetics market.

4.4 Market Segmentation

From the very beginning business enterprises, the market for cosmetics is not limited local
market. It has from both internal and external (from abroad), the local market refers to all market
with the national boundary while the foreign market refers to the export of cosmetics to middle
cost countries and to some extent to Europe, Asia, etc.
Cosmetics providing enterprises business in well organized, licensed by the name cosmetic
providing business, growth oriented, gradually involves in the production of different services
and when involved in new services by creating backward and forward linkage.
As we have stated out previously, the competitors house lack of structure and organization lead
them into in efficient and have declining sales. They are also not well organized and structured,
no further expansion and shortage of materials that is they depend in cease and need assistance of
finance and qualified managers.

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quality so that the yield will be diversified for different customers. We want to be put ever where

and when ever in the mind of our consumers which comes basically through quality assurance.

5. PRODUCTION
5.1 production process
The beauty cosmetics production in this phase is not complicated. Even the highly skilled labor
is not also needed.
Beauty Cosmetics Salon is profitable and efficiently utilizes the present and future technology in
the beauty Cosmetics salon. The company by acquiring existing profitable beauty cosmetics with
all the necessary custom innovated equipment will get significant industry advantage.

5.2 Resource requirement

As any business beauty cosmetics supply needs physical, financial, human, and technological
resources.
The business has to become technological and there is indication that this popular management
should be allocating human resource us the professions permit.
Our Beauty Cosmetics salon will have:
One sale man
One supervisor
One accountant
One business manager
The Company also hires additional temporary employees when needed. Careful business analysis
and honest advertising will take the enterprise a real life.

5.3 Quality Assurance

In our business, quality matters pay more attention. It starts from the species diversities of the
Cosmetics. They will be of special

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This company are purchasing high quality and modernized Cosmetics and preparing store houses
where Cosmetics stored when ever there is excess supply of Cosmotics, auditing daily sales of
business. Enterprises offer high quality and quantity Cosmotics for user and Customers.

6. ANALYSIS OF COMPETITORS
6.1 Competitive Advantage
As has been expained in competitors, status section quality is not only given unique concern but
also taken as one basic competition mechanism. In our business, quality matters pay more
attention. They will be of special quality so that the yield will be diversified for different
customers.
We truly believe that your business is not only as good as your products but the quality of your
staff as well. Our stay is a reflection of us. Initially, we intend to employ our family members
who will work for lower and reduced wages

7. SWOT ANALYSIS

It shows the strength,weakness,opportunity and threat of the business.

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7.1 Strength

 They have experience in this area throughout their operation time

 The beauty are known by the people of Bedele town because of their seniority
 They know the consumer preference and wants by their experience
 Theyfacilitatestrongconnectionwithfinancialinstitutionsandinvestors

7.2 Weakness

 There is no fast food and soft drink service as the customer demanded
 Their services do not include or consider children need and want
 Low advertising and sales promotion
 Limitationintermsofontimemovies

7.3 Opportunity

 High demand of the customers towards the products.

 The status of using the standard technology to grow our productivities.
 There are low number competitors at the areas.
 There will be shortage of suppliers
 Suitability of the areas for trading

7.4 Threats

 Will there be increasing of tax.

 Will there be inflation.
 The high increment of rent of house
 Increases the cost of supplies

8. ORGANIZATIONAL PLAN

8.1 Organizational Structure and Venture Holder

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Cosmotics providing business enterprise provide each type of Cosmotics from Bedele and Addis
Ababa. It sells the product to consumer and other small industry which interested in It. It also
sells the product to service rendering firms such as Barberry and Beuaty salons Business. The
brand of the business is designed to be Cosmotics providing enterprises, it is named so because it
will have good attitude on society, it doesn't affect the natural environment and initiate people to
purchase the product and as it is new.

The organization will contain the following structure;

1 General manager....................... MEKUANINT LEGESE

2 marketing manager....................JEMAL MUHE

3 Financial manager.................... ASTER YOSEP

4 Sale manager................... …….ENDRIS FETENE

5 customer service manager...... …TENA BITEW

The permanent employees of the business consist of four workers. The three are responsible for
day to day activities of business.

8.2 Forms of Ownership

Cosmotics providing Business enterprises are a type of business in the form of partnership. There
are reasons for the selection of this form of business; these are

. profitability of the business specially after the first year

.Ease of formation of business

The overall operation or function of the owner would be governed or administered by the owner
there will be only one manager the manager had served for more than four years in this type of
business and have excellent experience in the area with this his educational background that
enable him to manage the business successful.

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8.3 Manager,s profile

As early explained in the organization of the management section the six partners are the
managers whose management position are indicated. The general manager, MEKUANINT
LEGESE has leadership who takes management course in first year and also he experiences in
different clubs in his countries.

Success in any enterprises is usually measured by the profit made from the effort put for the
profit from beuaty cosmotics salon on partly ammeter of good husbandry or good management
practice and ammeter of applying sound business principle to enterprise. The beauty cosmotics
salon is established from the action oriented, highly motivated to individual who are good at
creating of business opportunity from the simple thing better working environment creat job for
those who doesn't have livelihood participate in the activities of their country.

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9. MARKETING PLAN

9.1 Demand and Supply Analysis

Most of the time demand and supply do not balance each other. To balance supply with demands
we must do a continuous assessment on the number of our customer.we must identify the
primary need of our customers. We have to measure the daily, weekly, monthly and yearly
Consumption of the customer and compare with our products.by carrying out this process we can
balance demand and supply.

Because of their years of experience combined with their existing catering business, meseret and
buze have established relationship with qualified supplier. These suppliers can provide
reasonably priced products, delivered according to the schedule.

9.2 Pricing strategy

The basis for our cosmetics prices is the market price and cost-benefit analysis. Therefore, due to
presence of small competitive, the business cannot set high prices. Even if the business operates
at lower cost it would not price below the market prices just because of the purpose result,
cosmetics providing business enterprise. As a result, cosmetics providing business enterprise set
the price of cosmetics as the market that is it fluctuates over the time with market price.

9.3 distribution strategy

The distribution of the cosmetics would be in three ways first, the business its self-undertake
retail service to consumers and customers at market price. Secondly, by selling the product to the
whole sales and thirdly by selling to both whole salers and retailer.

9.4 Promotion strategy

The promotion activity will be done once in a couple of months through notices to be posted at
public center and also through
 Newspaper and magazines
 Radio and TV


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10. FINANCIAL PLAN

10.1 Financial Statement

The business plan is prepared to obtain funds amounting 30,000 birr. The supplementary
financing is required to being work on site preparation, equipment purchases and to cover
expense in the first year of operations. Additional financing has already been secured in the form
of;

1. Birr 36520 from personal capital and

2. Birr 45,000 from closed relatives
N o I t e m s T y p e s Quantity Unit price Total cost
1 C a s h Hair cream 6 0 3 0 0 0 0
2 Bergamoth Conditioner 2 0 0 4 0 1 2 0 0 0
3 H e r b a l L o t i o n 2 0 0 3 5 8 0 0 0
4 C o c o a S o a p 1 5 0 1 3 5 2 5 0
5 D u r u S o a p 2 0 0 8 2 6 0 0
6 Lifeboy Shampoo 5 0 0 5 5 4 0 0 0
7 D o x e Conditioner 2 5 0 4 5 1 3 7 4 5
8 H o b b y L o t i o n 1 0 0 3 5 4 5 0 0
9 Topsociety 2 0 0 5 5 7 0 0 0
1 0 Vaseline 2 5 0 0 5 5 0 0
1 1 S h e l f 4 3 0 0 1 0 0 0
1 2 T a b l e 1 0 0 5 0 1 2 0 0
1 3 S m a r t Deodorant 2 0 0 3 0 5 0 0 0
1 4 F A Deodorant 6 0 0 0
1 5 Miscellaneous 1 5 0 3 3 3 2 0
1 6 Wazeline 1 3 3 5 4 9 5 0
1 7 Sinonas 4 5 5
1 8 Total expense 1 1 1 5 2 0

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year of operation it is assumed that the business will increase the provision of cosmetics and
overall sales from 7000 birr/month to 7875 birr/month on average.
Revenue (Sales) annually 94,500 birr per year 7875*12
Pro-forma income statement of year 2
Sales…………………………………………………………………………94500
Expense
Salary……………………………………….………………………………45000
Depreciation expense……………………………………………………….12852
Freight expense………………………………………………………...……300
Interest expense………………………………………………………….…3000
Miscellaneous expense…………………………………………….……….320
Total expense…………………………………………………………….....61972
Gross profit…………………………………………………………………32528
In the third year of operation it is assumed that the business will increases the operation of sales
volume from 7875 birr to 9625 birr per month, using full capacity at efficiency. Therefore
Revenue (Sales) annually= 9625*12=115500
Pro-forma income statement of 3rd year
Sales…………………………………………………………………………115500
Expense
Salary……………………………………….………………………………45000

10.2 Financial Resources

The start up cost of the Venture is birr 300,000. For activities of the business house is freely
given by the local administration. This is an opportunity is given to the new enterpreneurs
especially for those who are graduated from Universities. But we are expected to pay birr 1500
lease per year. To fulfill the above costs the Venture, total of birr 200,000 will be borrowed from
oromia credit & loan Association and received as gifts loan from relatives and friends. The loan
will be repaid within four years and the rest amount of the resource requirements will be
contributed by the Venture partners in accordance with some percentage proportion.

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10.3 Financial strategy
The business prepares different types of strategies so as to possess and use its financial resources
properly. The cash generated from the operation of the business should be managed or dispersed
to meet the prior strategies of the Venture. Expansion and growth and pay to liability before
dividends. The business follows holding cash only in required amount for running the business
well.

10.4. Assessment of Risk and Contingency

10.4.1 RISK
The expected of risk to the business May be loss of income from expired and cosmetics during
operation may happen in the future, hence no one is certain about future. The other expected loss
is attributed to fluctuations of Market price (devaluation, inflation and deflation). The
business also doesn't use advanced technology whenever there is appropriate technology that go
with operation is ready to make use.

10.4.2 Contingency plan

Providing quality products to compete and sustain in the market;
. Searching alternative raw material sources;
. Adapting alternative new technologies;
. Using appropriate medical treatment like vaccination for our Cosmotics
Generally,all these are the plan of Cosmotics supply to penetrate into the market through
supplying quality product for potential customers with relative price and to sustain by
strengthing the competence of the company.

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11 Break Even Analysis
Break-Even Analysis for 1st year
Total sales of cosmetics on average-------------------------------birr 84000
Total cost of each cosmetics----------------------------------------birr 61972
Gross profit (GP) ------------------------------------------------------birr22028
Gross profit margin (GPM) =GP/SALES *100=22028/84000*100=26.23
Overhead (fixed cost) for first year -----------------------------birr 60,172
Breakeven turn over= overhead/GPM *100
=birr 60172/26.23*100= 71.63%
Breakeven Analysis for 2nd year
Total sales of cosmetics on average ------------------------------------birr 94,500
Total cost of cosmetics ---------------------------------------------------birr (61,972)
Gross profit (GP) ----------------------------------------------------------birr 32,528
Gross profit margin GPM= 32528/94500*100=34.42%
Overhead (fixed cost) for 2nd year --------------------------------------------birr 60,172
Breakeven turn over=birr 60172/34.42*100=174816.97birr
Break even gross profit margin= 60172/94500*100=63.67%
Breakeven Analysis for 3rd year
Total sales of cosmetics on average-----------------------------------------birr 115500
Total cost of cosmetics--------------------------------------------------------birr (61972)
Gross profit (GP) ---------------------------------------------------------------birr 53528
Gross profit margin GPM= 53528/115500*100=46.34%
Overhead (fixed cost) for 2nd year--------------------------------------------birr 60172
Breakeven turn over =birr 60172/46.34*100=129848.94birr
Breakeven gross profit margin 60172/115500*100=52.096%

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APPNDEIX

In addition our business plan can serve several function and each require a different set of
documentation. This plan wants to prepare for our appendix of business and personal tax returns,
owners and key management, photos of our products contrasts current or future work.

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