Prepared By:

BBAM/LMR/1490/18

A BUSINESS PLAN SUBMITTED TO THE DEPARTMENT OF BUSINESS

ADMINISTRATION IN PARTIAL FULFILMENT OF THE REQUIREMENTS FOR THE
AWARD OF A BACHELORS DEGREE OF ST. PAUL’S UNIVERSITY

AUGUST 2020
 DECLARATION
I hereby declare that this document is my original work and has not been published or submitted
for any degree, diploma or any other equivalent titles in any other places. This report has been
undertaken in partial fulfillment of BBAM program at St. Paul’s University Limuru.

Signed ………………………………………….Date………………………………….

FRANCIS WAHOME GITAHI

Signed…………………………………………..Date………………………………….

Wanjiku Ng’ang’a

Lecturer

Department of Business

St. Paul’s University

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 ACKNOWLEDGEMENT
Them that I love know that I adore them. I want to thank you the reader and I hope you find this
document meaningful. To my lecturer Ms. Wanjiku Ng’ang’a for patiently allowing me time to
make this work possible.

Lastly, the investors who will find Threefold Limited worth a spot in their portfolio. Thank you
all in advance for taking time to scheme through my idea of a business with hundreds if not
thousands of quality leads.

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 EXECUTIVE SUMMARY
Threefold Limited has the primary responsibility to provide quality and reliable digital
marketing services to Micro, Small and Medium Enterprises in Kenya.
The company’s performance will be articulated with various companies’ growth
policies to ensure we are of the utmost value to each of our clients. By simply, being a
part of their growth team.
Vision
“A world class digital marketing service provider”
Mission
“To provide quality digital marketing services at client friendly and affordable prices
in line with client preferences and goals”
Core Values
Team work and efficiency
Fast customer Responsiveness
Research and Innovation
Target Market
It is estimated that there will be steady growth in the number of companies coming up
in the market attempting to produce and supply various goods and services. Our main
market and target will be Micro, Small and Medium Enterprises in Kenya; later
expanding to other parts of Africa, from East Africa. The company will not exclude
even the businesses currently served by other digital marketing agencies.
MARKETING PLAN

Threefold Limited will position itself in the market by coming up with a basket of
marketing strategies including promotions and price controls. At the same time the
company will attempt to address the issue of managing companies’ promotional
campaigns closely with individual representatives from each of these companies to
ensure transparency in service delivery. The company is also expected to invest heavily
on promoting itself through various means; both online and offline. This is with intent
to continuously expand our client base and thereby enabling us to compete in terms of

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price reduction. Every marketing and service delivery will be aimed at achieving
greater customer obsession towards our services.
Design and Development
Threefold Limited has identified the gaps in the MSME sector nationally and came up
with the appropriate strategies to address those gaps.
Management Team and Staff Establishment
The Company will be run by a team of competent personnel headed by the Managing
Director (MD). Apart from leading the company, the MD will oversee the designing,
planning and implementation of appropriate interventions that meet client needs and
expectations.

Financial Forecasting and market share

Owing to various research conducted on Micro, Small and Medium Enterprises, it’s
evident that locally, these firms do not fully make use of the market that the rapid
growth in technology has brought about. Very few actually go beyond just having a
website. But of what good is a website that doesn’t generate leads for a business? This
is the question we at Threefold Limited seek to answer by transforming these mediums
into sources of customers for products.

It’s expected that the business will perform positively after breaking even at the
projected breakeven point. The business has shown pre-existing potential to expand
further into other industries for an even bigger share in the market.

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 TABLE OF CONTENTS
DECLARATION..............................................................................................................................i
ACKNOWLEDGEMENT................................................................................................................i
EXECUTIVE SUMMARY..............................................................................................................i
TABLE OF CONTENTS...............................................................................................................iii
LIST OF TABLES..........................................................................................................................vi
LIST OF FIGURES.......................................................................................................................vii
ABBREVIATIONS AND ACCRONYMS..................................................................................viii
DEFINITION OF TERMS.............................................................................................................ix
CHAPTER ONE..............................................................................................................................1
BUSINESS DESCRIPTION...........................................................................................................1
1.0 Background Information............................................................................................................1
1.2 Business Location......................................................................................................................1
1.3 Form of Business Ownership.....................................................................................................1
1.4 Type of Business........................................................................................................................1
1.5 Product and Service...................................................................................................................2
1.6 Justification and Viability of the Business Opportunity............................................................5
1.7 Industry Structure and Trends...................................................................................................5
Business goals..................................................................................................................................6
1.8 Short-term Growth Strategies....................................................................................................6
1.9 Long-term Growth Strategies....................................................................................................7
10.0 Mission and vision statements.................................................................................................7
10.1 Mission Statement................................................................................................................7
10.2 Vision Statement..................................................................................................................7
10. 3 Entry and growth strategies....................................................................................................8
10.3.1 Entry Strategy...................................................................................................................8
10.3.2 Growth Strategies.................................................................................................................8
CHAPTER TWO...........................................................................................................................10
MARKETING PLAN....................................................................................................................10

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 2.0 Customers.............................................................................................................................10
2.1 Market Share........................................................................................................................10
2.2 Competitors..........................................................................................................................11
2.3 Promotional Methods...........................................................................................................12
2.4 Pricing strategies..................................................................................................................13
2.5 Sales Tactics.........................................................................................................................14
Persistency and follow-up..........................................................................................................14
2.7 Marketing Strategies and Plan.............................................................................................17
2.8 Distribution Strategies..........................................................................................................18
2.9 Suppliers...............................................................................................................................18
3.0 Coping with Change.............................................................................................................18
CHAPTER THREE.......................................................................................................................19
MANAGEMENT AND ORGANIZATION PLAN......................................................................19
3.0 Organizational Structure......................................................................................................19
3.1 Key Management Personnel................................................................................................19
3.2 Staffing/ Recruitment/Training............................................................................................20
3.3 Remuneration and Incentives...............................................................................................20
3.4 Licenses/permits and By-laws.............................................................................................23
3.5 Supporting Advisors & Services..........................................................................................24
CHAPTER FOUR.........................................................................................................................25
PRODUCTION AND OPERATIONAL PLAN...........................................................................25
4.1 Plant facilities and equipment..................................................................................................25
4.2 Production strategies................................................................................................................27
4.3 Stages of production/operational process................................................................................28
4.4 Regulation affecting operations...............................................................................................29
4.5 Trade mark and logo................................................................................................................29
CHAPTER FIVE...........................................................................................................................31
FINANCIAL ANALYSIS AND PLAN........................................................................................31
5.0 Introduction..............................................................................................................................31
5.1 Financial Accountability..........................................................................................................31
5.2 Financial Objectives................................................................................................................31

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5.3 Financial strategies..................................................................................................................32
5.4 Pre-operational costs for two years..........................................................................................33
5.5 Cash flow projections for two years........................................................................................34
5.6 Pro-forma income statement for two years..............................................................................35
5.7 Pro-forma Balance sheet for two years....................................................................................38
5.8 Break even analysis.................................................................................................................40
5.9 Profitability ratios....................................................................................................................42
6.0 Desired Financing....................................................................................................................44
6.1 Proposed capitalization............................................................................................................45
CHAPTER SIX..............................................................................................................................46
CRITICAL RISK ANALYSIS......................................................................................................46
6.0 Introduction..............................................................................................................................46
6.2 Operational risk.......................................................................................................................46
6.2.1 Risk and control self-assessment (RCSA)........................................................................46
6.2.2 Loss event monitoring.......................................................................................................46
6.2.3 Key risk indicators (KRIs)................................................................................................46
6.6 Industry risk.............................................................................................................................47
6.7 Financial risk...........................................................................................................................47
6.8 Political risk.............................................................................................................................48
6.9 Economic risk..........................................................................................................................48
REFERENCES..............................................................................................................................50

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 LIST OF TABLES
Table 1. 1 Equipment Required
Table 1. 1 Table Services...............................................................................................................13
Table 1. 2 Equipment Required.....................................................................................................25
Table 1. 3 Pre-operational costs.....................................................................................................33
Table 1. 4 Cash Flow Projections..................................................................................................34
Table 1. 5 Pro-forma Income Statement........................................................................................35
Table 1. 6 Balance Sheet...............................................................................................................39
Table 1. 7 Breakeven Analysis......................................................................................................41

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 LIST OF FIGURES
Figure 1. 1 SME Marketing Expenditure.....................................................................................11
Figure 1. 2 Organization Structure................................................................................................19
Figure 1. 3 Premise Layout...........................................................................................................27
Figure 1. 4 Service Process............................................................................................................28
Figure 1. 5 Business Logo.............................................................................................................30

ABBREVIATIONS AND ACCRONYMS

B2B: Business to Business..........................................................................................................................9
CBD: Central Business District...................................................................................................................1
CEO: Chief Executive Officer...................................................................................................................15
CTA: Call To Action...................................................................................................................................2
GDP: Gross Domestic Product....................................................................................................................8
KES: Kenya Shillings..................................................................................................................................8
MD: Managing Director............................................................................................................................15
MSK: Marketing Society of Kenya.............................................................................................................4
MSME: Micro Small and Medium Enterprises...........................................................................................7
NHIF: National Hospital Insurance Fund..................................................................................................17
NSSF: National Social Security Fund........................................................................................................17
PPC: Pay Per Click......................................................................................................................................2
SEM: Search Engine Marketing..................................................................................................................1
SEO: Search Engine Optimization..............................................................................................................1
SMS: Short Messages Service.....................................................................................................................1

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 DEFINITION OF TERMS
Shares; - A share is a unit used as mutual funds, limited partnerships, and real estate investment trusts.

Facebook; - It’s an American social media conglomerate corporation based in Menlo Park, California.

Google; - It’s an American multinational technology company that specializes in Internet-related services
and products, which include online advertising technologies, a search engine, cloud computing, software,
and hardware.

Twitter; - Twitter is an American micro blogging and social networking service on which users post and
interact with messages known as "tweets".

Instagram; - Instagram is an American photo and video sharing social networking service owned by
Facebook, created by Kevin Systrom and Mike Krieger and originally launched on iOS in October 2010.

LinkedIn; - LinkedIn is an American business and employment-oriented online service that operates via
websites and mobile apps.

Google Plus; - It was a social network owned and operated by Google.

Pay Per Click; - Pay-per-click is an internet advertising model used to drive traffic to websites, in which
an advertiser pays a publisher when the ad is clicked.

Web Design; - Web design encompasses many different skills and disciplines in the production and
maintenance of websites.

Copywriting; - Copywriting is the act or occupation of writing text for the purpose of advertising or other
forms of marketing.

Email; - its information stored on a computer that is exchanged between two users over
telecommunications.

Outdoor Media; - Outdoor advertising is an advertising strategy that reaches consumers when they are
outside their homes.

Software; - It’s a collection of data or computer instructions that tell the computer how to work.

Web Hosting; - Web hosting is a service that allows organizations and individuals to post a website or
web page onto the Internet.

Mobile Application; - A mobile application, also referred to as a mobile app or simply an app, is a
computer program or software application designed to run on a mobile device such as a phone, tablet, or
watch.

Ecommerce; - E-commerce is the activity of electronically buying or selling of products on online

services or over the Internet.

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Insurance; - Insurance is a means of protection from financial loss. It is a form of risk management,
primarily used to hedge against the risk of a contingent or uncertain loss.

Investment; - To invest is to allocate money in the expectation of some benefit in the future.

Digital Marketing; - it’s is advertising delivered through digital channels. Channels such as social media,
mobile applications, email, web applications, search engines, websites, or any new digital channel.

Market Share; - Market share is the percentage of a market accounted for by a specific entity.

Competitor; - an organization or country engaged in commercial or economic competition with others.

Promotion; - refers to any type of marketing communication used to inform or persuade target audiences
of the relative merits of a product, service, brand or issue.

Discount; - refers to an amount or percentage deducted from the normal selling price of something. If you
wait until after the holiday, you can often buy goods at a steep discount — just make sure you need all
that stuff.

Sales Tactics; - A sales tactic is any action you take to put your sales strategy into action.

Follow-up; - A continuation or repetition of something that has already been started or done.

Price; - A price is the quantity of payment or compensation given by one party to another in return for one
unit of goods or services.

Product; - a product is an object or system made available for consumer use; it is anything that can be
offered to a market to satisfy the desire or need of a customer.

Advertising; - Advertising is a marketing communication that employs an openly sponsored, non-personal

message to promote or sell a product, service or idea.

Public Relations; - Public relations is the practice of deliberately managing the release and spread of
information between an individual or an organization and the public.

Publicity; - Notice or attention given to someone or something by the media.

Personal Selling; - Personal selling occurs when a sales representative meets with a potential client for the
purpose of transacting a sale.

Direct selling; - Direct selling is selling products directly to consumers in a non-retail environment.

Sponsorship; - Sponsorship is when a company commits money or resources to a nonprofit event or

program in exchange for specific promotional benefits.

Finance; - Finance is a term for matters regarding the management, creation, and study of money and
investments.

Human Resource; - Human resources is the set of the people who make up the workforce of an
organization, business sector, industry, or economy.

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Staffing; - Staffing is the process of hiring eligible candidates in the organization or company for specific
positions.

Remuneration; - Remuneration is the pay or other financial compensation provided in exchange for an
employee's services performed.

Incentives; - An incentive is a contingent motivator.

Salary; - A salary is a form of payment from an employer to an employee, which may be specified in an
employment contract.

Wages; - A wage is monetary compensation paid by an employer to an employee in exchange for work
done.

Commissions; - Commissions are a form of variable-pay remuneration for services rendered or products
sold.

Award; - A prize or other mark of recognition given in honor of an achievement.

Affiliate Program; - It’s a type of performance-based marketing in which a business rewards one or more
affiliates for each visitor or customer brought by the affiliate's own marketing efforts.

License; - A license or licence is an official permission or permit to do, use, or own something.

By-laws; - A by-law is a rule or law established by an organization or community to regulate itself, as

allowed or provided for by some higher authority.

Supplier;- A supplier is a person or business that provides a product or service to another entity.

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 CHAPTER ONE

BUSINESS DESCRIPTION

1.0 Background Information

Proposed business name is Threefold Limited. I chose the name because it signifies the core purpose of
its operations; growing other firms by providing leads to their products and services.
Francis Wahome will be the owner and founder of the company.
He pursued a bachelor degree in Business Administration and majored in Marketing. He also got
numerous exposures in form of internships from which he realized that majority of business missed out
when it came to online marketing. This realization gave birth to the idea of a digital marketing company.
Threefold will be incorporated on as soon as the financing process is complete and all sources clearly
stated and known under the Companies Act CAP 486 as a private company limited by shares. It will
operate as a marketing agency of businesses mainly small and midsized companies and also start-ups. The
services will cover Nairobi County region and expand gradually to other parts of the country and to the
East African community firms.

1.2 Business Location

The company shall be situated in the outskirts of Nairobi City due to rental costs of the office.
Particularly in Parklands. The location is easily accessible from the CBD and the office space is
quite affordable for a startup.

1.3 Form of Business Ownership

Threefold will operate as a limited liability company. This is mainly due to the nature of this
form of ownership and its advantage of shielding its owners from the entity’s liabilities. A
Limited Liability Company combines elements of sole proprietorship, a corporation and a
partnership and profits are only taxed once. These are the main reasons and upsides of the form
of business form, hence the reason I chose the kind of formality.

1.4 Type of Business

Mainly operating as a service business, the business idea came as a result of numerous exposure
to companies that seemed to perform quite poorly in sales and market reach. This was when I
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was an Intern on several occasions. I realized that despite the increased use of the internet and
social media at large, many companies still haven’t made use of the already huge market online.
I therefore saw that as a gap for formation of this business that’s expected to serve these
companies by providing digital marketing services and other marketing consultancy services to
them. Threefold will therefore be a digital marketing agency that will solely deal with all digital
marketing aspects of small and midsized companies. From Facebook adverts to Google adwords
and all other social media marketing campaigns like Twitter, Instagram, LinkedIn, GooglePlus
among others. The company will seek to manage all these advertising campaigns on behalf of the
concerned firms at a considerate fee, both monthly and commission-wise. The company will start
as a small Facebook marketing company but is later expected to expand to other services, for
instance SEO and SEM services, web design, content creation, email and bulky SMS services
among other online promotional lead generation services.
The major change in marketing environment is the emergence of electronic data-processing
equipment as a major tool of scientific marketing not only for reporting data but also, more
importantly, for planning and control by management. Most companies are taking advantage of
electronic data-processing analyses, online communications, and information-retrieval systems
as tools to help make marketing more efficient. This has led to the emergence of real – time
marketing (Dr. Amol, 2018).
In a world where businesses are rapidly accepting and taking their products online and using data
on consumer online behavior to optimally influence their consumption. It’s therefore evident that
Threefold will attract and retain a significant market in the long-term future.
Its core clients and target market are the Micro Small and Medium Enterprises. This is because
majority of them do not do any advertising on the internet and in turn they rely on the traditional
modes of marketing to lure prospects into buying their products and services.

1.5 Product and Service

Threefold will offer a wide range of digital marketing services to its clients; both corporate and
individual traders getting started with online marketing.
The following services will be offered;

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A. SEO ; - Is an abbreviation for Search Engine Optimization. It’s an offline website
optimization strategy used to make a website more visible by online communities.
Threefold Limited will attempt to also create optimized quality content for both social
media and client blog to make them appear of the first page of Google search results
through Google indexing.
B. Pay per Click Advertising (PPC); - It’s a modern day art of getting clients or leads for
products or services by paying for internet adverts. The ads are then distributed by
Google to meet the people you target initially through your means of lead profiling. Since
Google has a record of everyone that uses the internet and how they use the internet, its
then able to effectively target everyone who meets the requirements of being a possible
match for the advertised products or services.
C. Email Marketing; - It refers to the use of personalized emails that are distributed to
various leads that a company has. The process first begins with lead generation and then
the leads are constantly fed with information in the attempt to help them complete a given
Call To Action (CTA).
D. Social Media Marketing; - Often one the most underrated mode of marketing, social
media marketing is the new norm of getting leads and customers for various products and
services. Threefold Limited will incorporate social media marketing in its long-term
marketing strategy for both itself and on behalf of clients.
E. Web design and development; - Refers to creation and development of websites for
clients. Websites are virtual businesses where all prospects and other interested parties
can get information about a given business everyday every hour. Websites houses
company information that is important to its consumers. Such information could be
Office hours, information on offers, calendar events among others.
F. Content Creation (Copywriting); - This involves creating both visual and text content
that is listed in social media accounts, blogs and company websites. They are bits of
information that tell consumers and web visitors about a company they just found online.
Content creation with the help of a good SEO mix can help a great deal of success of a
website for luring people to visit the physical office to make purchases of see the
advertised products or inquire about the services.

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Each of these services has a great potential to generate income on their own if marketed
appropriately. They also possess the ability to grow exponentially over years.
The firm will also have expansion opportunities in future. I expect the starting operations to
generate enough over a period of time the capital to add additional income streams into the
company’s revenue. These expansion areas will include;
A. Outdoor Media Advertising; - This is a form of offline advertising usually done in busy
streets to communicate with target market about a given service or product. The main
idea is to get them to take a given action; for instance, buy a product or to enlighten the
audience.
B. Software Development; - Software make work easier, we use different softwares on a
daily basis in our devices, cars and other computerized machineries. They are a set of
commands that govern and order computers to perform a given task and in a given way.
Threefold limited will venture into producing and distributing these valuable softwares in
to the market at both corporate and individual usages.
C. Web Hosting; - This is the process of housing company websites in one huge computer
server owned, operated by a company. Threefold estimates a monthly income of about
KES 7,550,000 from this venture. This income will come from monthly space fee (web
hosting fees) charged on these companies and individuals for hosting their sites on our
server.
D. Mobile Application Development; - Mobile applications are computer programs or
software applications designed to run on a mobile devices and tablets. They are used to
house important information, promote product and services, and communicate with target
audiences. Preferably those who have installed them on their devices. Many companies
have their own mobile apps.
E. Ecommerce; - E-commerce is the activity of electronically buying or selling of products
on online services or over the Internet. The company will be selling various products on
its newly formed website store. Threefold is expected to venture into ecommerce selling
at a later stage in its life. The ecommerce industry has great potentials to generate hefty
profits for the business.
F. Insurance; - Insurance simply means protection over a sudden financial loss. Threefold
shall venture into this industry and attempt to compete with various insurance companies

4
 to protect clients from financial losses. This will serve as an additional income stream for
the company.
G. Investment; - Threefold limited will set aside a portion of its profits for investment in
other ventures and investment vehicles. Such investments will include but not limited to;
Stocks, bonds, treasury bills, partnerships, venture capitals, real estate, forex trading
among other potentially profitable areas.

1.6 Justification and Viability of the Business Opportunity

Many small and midsized firms have not been able to fully tap into online. Despite many of them
owning a website, most of them remain inactive and do not generate leads for their products and
services. There isn’t enough traffic in those websites or blogs incase a company has gone an
extra mile. The company will attempt to use these online mediums to drive mass leads for
companies’ products and services.
The small and medium enterprises locally do not make use of the internet to advertise their
products hence they don’t operate on their full capacity. We will attempt to offer them with
quality solutions to better their sales volumes. This will in turn make them more successful than
they currently are.

1.7 Industry Structure and Trends

The marketing industry is the national umbrella that empowers all marketers and all marketing
companies and is regulated by the Marketing Society of Kenya (MSK). MSK ensures that all
parties involved in the communication channel including environment are not harmfully affected
by the marketing activities. The umbrella generally observes and makes sure the ethical
standards of all marketing activities are upheld and does so by also punishing those who indulge
in unethical practices while operating in the marketing industry. Digital marketing is part of the
marketing elements that concentrates on and uses internet as a medium to communicate to and
inform product audiences about brands, companies and other useful information. Digital
marketing relies on devices such as desktops, laptops, tablets and smartphones to convey the
messages to target audience.
In general the business shall operate in the service sector. The marketing sector to be precise.
This industry is easier to enter so long as the business operates within the laid regulations. All the

5
business requires is to be registered and permitted to operate. Hence the ease of getting into the
business. The market is not also flooded and there are only a few well established similar
businesses in the industry.
As marketing is essential to any organization, the growth and innovation of new technologies has
brought an increased need for massive use of the internet to advertise. Many people use the
internet to influence their buying decisions and therefore by using internet meets and interacts
with consumers as they search for alternatives to satisfy their needs online.
The advertising industry in Kenya is rapidly developing and continues to attract both local and
international players. The multi-billion sector has seen exponential growth in the five years up to
2012. Local advertising spend was estimated to be KSh 20 billion in 2008, which by 2011 had
risen to KSh 65.4 billion, exclusive of online and outdoor advertising. According to trend
analysts, the political sector has the highest ad spend.

According to commonwealth network, The World Economic Forum’s Global Competitiveness

Report (2012-13) places Kenya 86th out of 144 countries in relation to the extent of marketing. It
was given a value of 3.8 out of 7, below the world mean of 4.1, indicating that companies use of
sophisticated marketing tools and techniques is not yet extensive.

Business goals
For a directional perspective we shall set specific goals that we would like the business to
achieve in the next number of years. Threefold will work towards achieving the following short-
term and long-term milestones; -

1.8 Short-term Growth Strategies

a. Create a brand that clients are obsessed with; - A memorable brand that consumers can
relate to and one that will always appear in the first position whenever they think of
marketing their brands.
b. Increase profit margins; - This will be achieved by increasing volume of services offered
instead of charging high fees for our services. We will attempt to serve more people at
lower rates.

6
 c. Increase efficiency; - Improving on quality and delivery every time will help the
company operate effectively and create a pool of happy clients
d. Acquire bigger market share; - This will be achieved by continuously adding into the
client base and creating new clients on a consistent basis.
e. Providing better customer service; - By continuously providing impeccable client
experience, we can be able to compete with already existing competition. Therefore the
company shall invest a lot on training its employees and research to understand the
competition and target market more.
f. Employee training and development; - Continuous development of employees through
training will not only be of value to them but also to the company since they will be able
to work more efficiently. The efficiency is expected to really be felt on the output level
by clients and measured continuously through their feedback.

1.9 Long-term Growth Strategies

a. Market Expansion; - By marketing the company on a larger scale, providing superior
services and investing in other areas, Threefold limited will be able to gain a competitive
power over most of its competitors. And similarly a larger market share.
b. Introduction of new revenue streams; - A continuous investment in other areas, the
company shall be able to build a large income base and similarly acquire the ability to
invest more on value and employee development. By having more income streams, the
company can then be able to adequately pay its employees and invest more on technology
to increase efficiency in delivery.

10.0 Mission and vision statements

10.1 Mission Statement

To provide quality digital marketing services at client friendly and affordable prices in line with
client preferences and goals

10.2 Vision Statement

A world class digital marketing service provider.

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10. 3 Entry and growth strategies

10.3.1 Entry Strategy

Licensing the business as a legal entity and acquiring the required operational permits from the
county government company registrar’s office and Nairobi City Council will set the business up.
After this the company will be fully launched via web adverts and social media ad campaigns.

10.3.2 Growth Strategies

The following strategies will be put in place to enhance profitability of the business; -
a. Value Preposition; - At the entry point, the company will emphasize its strategy on price
of services placing them at a much lower rates than those of the competitors. Then later
raise the price rates after gaining a considerable market share. The main aim will be to
get a consumer base that is obsessed with our services preferably the provocateur clients.
b. Understanding Key Audience; - Our main client base will and prospective consumers will
be micro, small and medium enterprises (MSMEs). This is due to the assumption that
huge corporations already have developed digital marketing departments in their
marketing lines.
c. Key Indicators; - These will be agreed on factors that will be used to quantify whether or
not the operations are yielding results. These will be used as signals to stop investment or
to keep pumping in more efforts on given operations towards growth.
d. Revenue Streams: - In order to ensure a constant growth in the company revenue and in
turn profits, Threefold will continuously reinvest portions of its profits into new streams
of revenue through investments. This will ensure that the business revenue base is
growing at a steadfast increment.
e. Compare with Competitor; - At Threefold, we the management will ensure a closer look
at the competitor strategies and attempt to emulate their most successful ones and apply
them into the company long-term and short-term growth strategies.
f. Investing more on Strengths; - Evaluating the company internal strengths and weaknesses
and investing more on improving on the areas in which are our strengths. This means that
the business shall not put too much of its resources into improving its weaknesses but

8
 rather to improve areas it’s considering itself as strengths. This will in turn improve on
the general efficiency and the productivity of the firm to its clients.
g. Talent Investing; - This basically means that Threefold shall hire employees who are
motivated and inspired by the company’s value preposition. An employee base that is
customer-centered and one that believes in the efficiency of delivery. Threefold Limited
will also retain a smaller number of employees, develop them as well as remunerate them
accordingly so as to motivate them even more.

9
 CHAPTER TWO

MARKETING PLAN

2.0 Customers
In order to ensure our clients efficient and quality results in line with their own growth strategies,
we will solely concentrate on serving client firms in the Micro, Small and Medium Enterprises
(MSMEs). This is due to the fact that most of them do not yet have a developed department
specialized in digital marketing and also most of MSMEs assign online marketing duties to
inexperienced or incompetent employees. Many of these MSMEs also, are made of a smaller
number of employees who of the times are super-busy with a lot of important managerial tasks
and do not find time to do online marketing.

2.1 Market Share

According to Small and Medium Enterprises Today, there are a total of about 7.41 million
Micro, Small and Medium Enterprises in Kenya. This constitutes of both registered and
unregistered companies. In another article published by this research website and supported by
Kenya Association of Manufacturers, a large proportion of MSMEs do not market or advertise
their products and services and rely heavily on quality of their products and clientele satisfaction
as their sole marketing tool.
Of this group of companies that do not do marketing and or advertising, Threefold Limited will
attempt to acquire at least 35% of this proportion in its first five years of operations. In another
article submitted by tradingeconomics.com, GDP from Services in Kenya decreased to 27457
KES Million in the first quarter of 2020 from 29142 KES Million in the fourth quarter of 2019.
This shows presence of a great opportunity to tap into, a market that is perhaps little or not
served at all.

10
Figure 1. 1 SME Marketing Expenditure

2.2 Competitors
Digital marketing agency is served by several digital marketing companies. The main player
being WPP - Scangroup. Founded in the year 1996, Scangroup has a vast experience gained over
the last two decades of operation in the marketing industry. There are also other over 60 small
companies in the digital marketing industry that offer digital marketing services. These are
represented in the pie chart below.

Market Share(5-Year Projection)

WPP-Scan Group Others Threefold

35%

50%

15%

Figure 2. 1 Market Share

11
2.3 Promotional Methods
The marketing will be entirely Business to Business (B2B) and will use the internet to get new
clients as well as communicating with the current active ones. Threefold Limited will use the
following promotional approaches to attract and retain clients;

a) Google promotions; - Immediately after launching the business and having a physical
office. The first thing to do will be to establish a presence online by creating a business
profile with Google My Business platform. This will be followed by mass awareness
campaigns using Google ads that will see the company adverts being ran via Google’s
select ad venues such as; websites, pop-up ads, on YouTube and in mobile apps among
other internet venues.
 When potential clients search for businesses similar to this one, they will be able to find
this one among the results. Those ways we are able appear in front of the right audiences.
Paid adverts will also be used promote the business online. We will bid for relevant
keywords on Google so as to be found y firms that search for digital marketing
companies online.
b) Discounted Prices; - By using holiday events to our advantage we will offer our services
at comparatively lower prices. This is expected to attract many firms and individuals to
apply for our services at prices that favor their marketing budgets. This method will for
instance cut service cost by a proportion. For instance by 40%, 30% or even by half the
normal price. Clients love reduced prices, we therefore expect to attract a lot of clients
using reduced prices. Vouchers and coupons; - These will be mainly used online through
the company website in the adverts and in emails to those who subscribe to our email list
and subsequently to our services. Vouchers can be redeemed in to various other products
like gifts from select stores while coupons allow clients opportunities to get the services
at comparatively lower prices.
c) Social media adverts and giveaways; - Running ads on various social media platforms
such as Facebook, LinkedIn and Twitter will be used to both attract new clients for the
company as well as to generate traffic to the company website. Traffic to the website will
enable us to track conversion rates.
d) Customer Loyalty programs; - This will involve devising loyalty programs to reward
loyal clients who consume our services repetitively. For instance, if a client uses our

12
 given service they get a given number of points that are redeemable at a certain level.
They can redeem the points and get free services of even lower prices.

2.4 Pricing strategies

After a keen look into available strategies of pricing, I have considerably chosen to apply the
following three strategies to price the company services;

a) Competitive pricing; - Using this mode of setting prices, we will set prices with respect to
those of the competition. We will often charge lower rates as compared to those of our
competition.
b) Penetration pricing; - Baring in mind this mode of pricing is used by many firms in their
start-up days, we will generally charge lower prices of our services to attract large
number of prospects. At the start, the main concern with sales will be volume; attraction
of many clients and charging them a fraction of what the competitor is charging for the
same services.
c) Value-based pricing; - This strategy uses consumer views of the services to decide how
services should be priced. It’s based on what customer believes is worth the services they
get. The method will be implemented at a later stage in the business life.

Some services will entirely depend on the amount that the client uses with us. In this case we
will only charge a portion from their total spent amount using the predetermined service rates.
Below is an illustration of services and attached prices for each;

Services Price Charge (KES)

Facebook page creation, optimization & Editing 2500 One-off
Facebook Page Management 15,000 Monthly
Facebook Ads Campaigns 25% of Total Ad Spend
Web design 35,000 – 150,000 One-off
SEO 30,000
Social Media Management (All other platform pages) 4,500 Monthly

Table 1. 1 Table Services

13
2.5 Sales Tactics
The following are the tactics we will put in place to ensure the a constant flow of leads for the
company;

Persistency and follow-up

As many sales people have been noted to give up when prospects don’t take action, Threefold
sales team will not give up and will put in every effort to nurture the leads until they take the
required action. This will be achieved by sending emails, making phone calls and sending
brochures at designated intervals to ensure that we arm them with the required information to
help them make a decision.

a) Problem solving

By knowing the problem we are getting in to solve and working around it in the day to day
operations. It will also be important for us to demonstrate in every way to the clients when they
reach out to us that we have the solution they are looking for. It will therefore be about ensuring
that we have the most qualified professional sales team who will e able to pinpoint client
problems and solve them first hand.

b) Listening to customers

This will be passed over also to the company sales team that, however well knowledgeable they
are about the problem client is experiencing. They should never get into knowledge powers and
try to override that with the clients. Because some clients have vast knowledge about the services
as well. The sales teams should therefore listen keenly to what the clients have to say before they
make the input. They should and will perhaps ask questions that probe into the client’s mind and
thought process. The overall goal here is to make clients feel respected and cared for by the
company.

c) Polite terms when discussing competition

Professionalism and positive image among our sales people. This will be enforced by penalizing
those who shred reputation of the company as well as looking keenly to it that all staff is
representing to the customers in a positive way. All sales team members will remain neutral
about any bad mouthing talks in conversations with the clients.

14
 d) Referrals

By first working towards winning their trust. We can then ask for referrals and even reward those
of our current clients who refer other clients to us. Referrals will generally come from our happy
customers and therefore in the early days of the business, we will strive to create that type of a
happy clientele base. We will initiate referral conversations into sales process during appropriate
times without having to look bad in front of clients.

e) Adhering to deadlines

This will involve creating sense of urgency with clients. When we promise to deliver after a
given time, the sales team should ensure that the service has been delivered within this time or
communicate well in advance with the clients if there is a need for any extensions in time.

f) Building relationships

Building a relationship with our current customers will ensure we get new ones from them in
future and therefore building a strong bond between them and the firm will strive to make them
part of the delivery process. We will also keep in contact with our current clients even after
closing the deals.

g) Identifying needs to meet

The goal of existing of the company will be to provide solution. By striving to pinpoint the
problems the customer needs solved, we can then be able to solve them. In order to identify
them, we will form a default set of questions that will be used to extract useful information about
what the client’s need is.

h) Identifying a lead from a customer

Leads are potential transactions and we cannot base the company’s future on potential
transactions. We will therefore strive to quickly identify the few who are willing and ready to
complete the transaction and keep on nurturing the remaining portion of leads.

i) Soliciting targeted leads

15
At first, this will be done by creating a strategy plan that will attract customers that fit into our
target market. I.e. MSMEs. By use of technology to target by a means of lead profiling. When
we have found perfect match to our services we then create customized sales pitch that will
appeal to each of their different demographics.

j) Uncovering every customer pain points

Learning about the prospects pain points for instance Fear of Loss will enable us to hit exactly
that point. This will achieved both with offline and online advertisements.

k) Storytelling

Arming salespeople with stories about people who used the services and got results; it’s much
easier to remember stories than facts and data.

l) Offering guarantees

If the client is willing to part their money with the company, then it would be fairer to offer them
a guarantee that they will get what they want in the right time and in the efficiency they want.
This can be done by offering money-back guarantees if clients are not pleased with the work
done.

m) Finding the right prospects

It would be important to note that by the sales team that not every being with a pulse is the right
prospect. This will include but not limited to finding leads that like or are interested in what we
do. It will be done by pre-qualifying them first before approaching for pitching.

n) Develop compelling goals and actionable plans

Understanding clearly where we want the company to go and in what time will help design an
action plan to propel the company towards that direction. It will also minimize time wasted on
irrelevant efforts in other things not in line with the goals.

o) Showcase proof that our service works

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Testimonials will work best at this point. Potential clients will want to know how efficient our
services can be and therefore by providing those with previous client testimonials help them to
decide faster whether or not to partner with Threefold or not.

p) Positive mindset

Making the effort to remain positive in good and tough times will not only create a good
impression on clients but also on the overall company image. Customers can tell when a sales
person is in good mood and when they are not. Positive sales people can be able to handle
stressful situations.

2.7 Marketing Strategies and Plan

a) Product

Threefold Limited will attempt to provide digital marketing services to MSMEs in all sectors of
the Kenyan economy. Even though the company will expand to other lines of services, the
anchor business operations will mainly be digital marketing.

b) Price

As discussed above in the Pricing Strategies Section, prices will vary with each service. For
instance, price of a given service may depend on the time spent to deliver, i.e. task difficulty.
Generally, prices will be lower than those of the competitors as an entry strategy.

c) Promotion

The company’s marketing team will incorporate all the elements of promotion to attract new
clients, communicate and retain the current ones. Elements applied in promotion will include;
Advertising, Public Relations and Publicity, Sales Promotion, Personal Selling, Direct Selling,
Event and Sponsorship Marketing and Internet and Interactive Marketing.

d) Place

Strategically, Threefold Limited shall operate in Nairobi County. And though not entirely in the
CBD, the company’s location shall be easily accessible by all prospects wishing to schedule

17
personal meetings with the sales team. With time and using available client base records, we
shall be able to decide which region will be suitable to place an extension office in.

2.8 Distribution Strategies

Due to the fact that the company will be offering services, the most suitable mode of reaching the
consumers will be via direct distribution. With this means, we will reach out and solve client
problems directly without having to put middlemen in between the channel. It’s due to this
reason that we will also be able to charge less on the services since there is no one else in the
distribution channel.

2.9 Suppliers
Although the decision on whom to tender the supplier role will be settled on at a later stage of
the business, it’s wise to note earlier that the company will not need much of supplies since it’s
in the service industry. But it will from time to time need supplies to deal with promotion; for
instance; company branding products like custom-made promotion equipment and stationery.

3.0 Coping with Change

The major change the company is expected to face will be on shifting of expenses due to having
underestimated the operating costs and the revenues. Depending on how the market will respond
to our marketing the initial expectations in terms of sales volume may or may not meet the
initially set projections.

The plan and strategies will therefore be adjusted from time to time to move at pace with the
prevailing results.

18
 CHAPTER THREE

MANAGEMENT AND ORGANIZATION PLAN

3.0 Organizational Structure
The management structure of Threefold Limited will be simpler in its early days. This is mainly
due to financial reasons and fewer operations expected in the start-up days. The top most rank in
the company will be held by a Chief Executive Officer who will also take on the responsibilities
of the Managing Director (MD). Within her first year in operations, Threefold Limited will has
projected to have employed at least twenty seven staff members.

Figure 1. 2 Organization Structure

3.1 Key Management Personnel
Communication is expected to flow from the second level management upwards to the CEO.
Main management team will be made up of a Sales manager, Human Resource manager who
will also take on the roles of Finance and Administration Officer. Most staff in the company will
multitask on various roles in the beginning. Most finance will be deployed mostly to growing the

19
sales. Easing on employee tasks will take place at a later stage after a considerable growth in
sales.
Sales manager roles will but not limited to; - Leading the sales teams, SEO OR Marketing team
and the Design Department. Human Resource Manager will also look up on all employee affairs
including formulation of policies governing the workforce, handling remuneration among other
employee related roles, the position holder shall also handle all office administration roles and
take on all finance activities. The managing director/ CEO shall also get in and assist all the key
management personnel with the roles assigned to them.
In the beginning, the staff will be required to be flexible and have the capacity to work across
roles of other positions. This is expected to last until the business can diversify.

3.2 Staffing/ Recruitment/Training

In order to ease up the process of getting the right employees to better fit the company. Threefold
Limited shall heavily use staffing agencies to acquire the perfect candidates. This will save on
time used to get and interview many candidates by narrowing down and focusing on the most
important thing; getting qualified candidates start being productive in their respective roles.
The company shall also invest on a regular basis on training its staff to improve their skills. This
will be done firstly by keenly observing their area of work and getting to know the required skills
that might improve their efficiency. Training will be continuous for both new and current
employees.

3.3 Remuneration and Incentives

Threefold Limited will attempt to motivate its workforce with adequate monetary and non-
monetary incentives. This will put the staff at a steadfast competition to better perform to acquire
the laid levels of incentives.
a) Salary – This is a fixed regular payment, typically paid on a monthly basis but often
expressed as an annual sum, made by employer to employee, especially a professional or
white-collar worker. Threefold firm will have fixed salaries for a number of fixed
positions. Such positions will receive a fixed amount of remuneration every month.
Salaries will however increase annually by KES 1,000 for each fixed employee.
b) Wages – These are often small sums of money paid often to casual workers. These are
people who provide services sometimes not on a consistent basis; such as office cleaners.
The company will hire often cleaners from outside the company and will not maintain

20
 them on payroll. They will therefore be paid depending on the number of days they
complete their cleaning duties.
c) Commission – In this mode of payment, the company will directly link employee
performance to how much they receive as payment. On salespeople, the company shall
pay wholly on commission basis. I.e. there will be a commission chart put in place and
various rates clearly stated. For instance, for a sale worth KES 15,000; the salesperson
will be awarded a 25% commission of the total worth of the deal closed. The upside of
this will be that the company will only pay upon seeing the results of closed deals and
hence useful remuneration.
d) Employee Benefits – The Company will also pay NHIF and NSSF plans for its long-
term fixed employees. NHIF will be a benefit to the individual employees in the event
they get ill or their children. The plan will cover most of their treatment costs and will be
paid on a monthly basis and remitted to their accounts. NSSF on the other hand is a
retirement plan that will also save KES 450 monthly into their retirement plan accounts.
The benefit is that they will end up getting something after their retirement age. These are
mainly payments done monthly by the pension managers and they pay the retirees a sum
known as pension every month.
e) Performance Bonuses – These will be tokens of appreciation awarded to those
employees who exceed the targets put in place. These bonuses will mainly be monetary.
And will be used to motivate employees to work harder to exceed the set limits.
f) Employee Holiday Trips – Based on merits, a number of employees will be offered
incentive holidays to various places in the country to enjoy themselves and their families.
This will be in form of fully paid vacations. The intention will be to entice employees and
the sales team to work tirelessly to achieve the vacations.
g) Awards – Various awards will be offered to those among the workforce that will meet
certain laid sales targets. These will be cash awards, gifts and vouchers. They will be
used to motivate workers to work themselves up beyond the laid limits.
h) Affiliate Programs – These are special programs that will be between the company and
individuals to promote the company services in exchange for commissions in each
successfully closed deal. Our affiliates will also earn a considerable amount of bonuses
and commissions when their referrals recurrently consume the company’s services.

21
The following is a table is a representation of the expected salaries of all the positions;
Title Count of Staff Key Tasks Key Skills Salaries/Wages
(Ksh/month)
Managing 1 Directing and PR, presentation 50,000
Director Controlling all skills, planning
operations & forecasting
Sales Manager 1 Designing, Leadership, 35,000
Implementing a organizational
strategic sales skills, training
plan & recruiting abilities
Business 1 Providing office Project 32,000
Administrator support; management,
customer & delegation, time
employee management,
support leadership
Salesperson 4(Part-time) Ring up Communication, 14,500
purchases, social selling,
provide storytelling,
information to business
prospect clients acumen
Salesperson 5(Fulltime) Ring up Communication, 14,500
purchases, social selling,
provide storytelling,
information to business
prospect clients acumen
SEO/Marketer 3 Updating, Content 12,500
Optimizing marketing,
web & social tech savvy,
media persuasive,
platforms analytics
Graphic 2 Managing client Design, editing, 16,800

22
Designer proposals, creativity,
briefing & innovation,
advising on trendy,
design detailed
Videographer 2 Creating video Creativity, 11,200
content for attention
clients to detail and
campaign editing
programs skills
B2B 2 Prospecting Communication, 18,700
Salesperson businesses for prospecting,
possible sales discovery &
business acumen
Content writer 6 Writing clear Adaptability, 15,000
marketing copy Communicate,
to understanding of
promote SEO & Research
products/services

The salary increment of every fulltime employee will increase annually by Kshs. 1,000. For part-
timers, their compensation will increase on merit basis accrued from their overall performance.

3.4 Licenses/permits and By-laws

To operate the company legally, Threefold Limited will need the following licenses and permits;
-
a) Certificate of Registration and Incorporation
Considering financial constraints and priorities at the start, the founder will register the
company’s name at Huduma Centre. It’s cheaper since the process will cost less than KES 3,000
unlike registering the entire company which can cost at least KES 35,000.
b) City Council Business Permit

23
This is a crucial document that we cannot operate without and therefore it’ll be a fast forward to
get us up and running. The cost of acquiring this certification defers depending on size and the
industry the company will be getting in. In this case, we will have to talk to a city council officer
on the cost of this document. This type of permit will be paid for every year.
c) Fire Safety Certificate
This is an important Fire Safety certification required to have in all businesses. It’ll will require
the company to at least have a fire extinguisher and any other fire safety requirement as advised
by a Fire Safety Inspector. The certificate will come after inspection is complete.
In addition, the company will also have to pay for an advertising signage; 300 mm by 600 mm or
less to the city council. The signage will be used as a mark for anyone looking to visit the office.
In addition to these crucial requirements of the business, employees will be required to submit
certificates of good conduct.

3.5 Supporting Advisors & Services

For long term success Threefold Limited will rely to some extent on professional advices to
make various moves in the market that might result in the untimely closure of the business. We
will use advice from companies such as Lincoln Advisors Kenya among others depending on
various occasions to better operate and expand in the Kenyan market and East Africa. We will
also use an Accounts Consultancy for filing tax returns and a branding company for branding
equipment.

24
 CHAPTER FOUR

PRODUCTION AND OPERATIONAL PLAN

4.1 Plant facilities and equipment

Toward the beginning up, the business will work with the locally accessible machine and
technologies. These technologies will be modest to buy, simple to keep up and use adequately.

This will be the bases for cutting edge innovation. The accompanying hardware and stationery
will be utilized for maintaining the business.
Table 1. 2 Equipment Required

s/n Equipment Qty Supplier Cost (KES) Use

1 Laptops 8 Jumia Kenya 320,000 Accessing internet
and overall
marketing work
2 Printers 1 “ 13,000 Printing
documents
3 Desks 3 Office smart 167,100 Placing
documents,
computer and
other stuffs
Office chairs 12 “ 62,640 Sitting
Cabinets 3 “ 57,300 Storing files
WIFI Router 1 ZUKU 5,000 Internet
connectivity
Bitrix 24 One 1 Bitrix 24 6,830 Management,
Stop Business collaboration and
software communication
Board Room 8 “ 92,560 Sitting

25
 chairs
Boardroom 1 “ 66,180 Hosting meetings
Table
Seats 3 “ 35,000 Sitting
Sub-hoofer at 1 Jumia Kenya 16,000 Entertainment
waiting area
4 Stationary
Files 30 Office smart 10,200 Storing
documents
Calculator 3 “ 3,900 Calculations
Biro Pens 4 pts. “ 1,100 Writing
Paper punch 4 “ 1,480 Punching holes on
documents for
filing
Stapler 4 “ 1,000 Holding together
documents
Whiteboard 1 “ 7,000 Meeting
Illustrations
Markers 1 pkt “ 500 Writing
Notebooks 7 “ 2,030 Writing
Pencils 1pkt “ 65 Writing
Envelops 1 box “ 215 Placing
documents for
clients
Paperclips 4 packs “ 200 Holding together
documents
Printing & 6 reams “ 3,000 Printing &
copying papers photocopying
documents
Office stamps 4 “ 7,780 Stampling office
documents

26
 Paid stamp 1 “ 2,490 Verifying
Payment
TOTAL 882,570

Premise

SALES ADMIN/ WASHROOM

CEO
MANAGER HR/FINANCE BOARD ROOM
Office

KITCHEN
KITCHEN

RECEPTION

COWORKING SPACE

SHELVES

WAITING AREA

Figure 1. 3 Premise Layout

4.2 Production strategies

 Differentiation strategy
Threefold Limited shall attempt to differentiate itself completely from the competition by being
creative in service delivery, being unique from the competition and upholding innovativeness.
 Quality Production strategy
Threefold limited will provide digital marketing consultancy services that are of high quality.
High quality online marketing solutions that they can rely on. Simply giving our clients absolute
value for their money. This will guarantee attraction of huge masses of leads who want high
quality leads for their products.
 Price cost strategy

27
By offering customer tailored prices of all our services, clients will be able to choose from a
wide basket of services that they really need and that are in line with their growth strategies.
These customer friendly service packages will be cost effective and will only charge a fraction of
what the competition is charging. This coupled with value for their budgets will create desirable
customer obsessions that will be the core anchor of the company.
 Outsourcing
In the early days, the business shall outsource employees from agencies. These will ensure that
the business gets quality as well as competent and experienced workforce without spending
money to train them. These vast experience in the industry will be translated into more efficiency
in service delivery.

4.3 Stages of production/operational process

Threefold limited will deliver its value to its clients through the following process as illustrated
in the figure below;

Figure 1. 4 Service Process

REQUEST A GET AN
PAYMENT DELIVERY
QUOTE INVOICE

Source: Author, 2020

Stage 1: Request a Quote

The client requests a quotation, either through the phone, walk into the office, on call or from the
website.
Stage 2: Get an Invoice
The client will be issued with an invoice of the services they would like offered to them. This is
the choice they made from a variety chosen from the overall quote.

Stage 3: Payments

28
The client will make the payments after they’ve arrived at a final stand with the sales team.
Payment will be either through the business paybill, bank account or even cash.

Stage 4: Delivery
This step will involve the actual start of work. For instance if the client intends to have a website
and social media pages, then this is the step in which the work will commence. Start of work will
commence after confirmation of successful payment.
Since its services, the delivery process will begin after listening keenly to what the client wants
and confirming that it can indeed be delivered. The sales team work hand in hand to ensure full
customer engagement in the whole delivery process.

4.4 Regulation affecting operations

Threefold limited will conform to all operational licenses and permits compliance with bodies
like Kenya Revenue Authority on tax payments and Nairobi County Council for the licenses and
business permits. Threefold limited shall also have property insurance and life insurance policies
that will insure the lives of all employees working with us in the business. The business shall
insure itself against calamities such as fire or robbery or fateful accidents. The company shall
also pay employees NHIF and NSSF premiums duly every month. And abide with other
employee union regulations regarding employee’s welfare.

4.5 Trade mark and logo

The logo concept is simple and relies entirely on the meaning of the business and value that it
holds. Threefold limited will strive to help businesses to get leads online through diverse internet
marketing campaigns and therefore it was important to include the “growth” aspect in the logo
concept. Visually the logo will include three strands and an arrow that passes right on top of the
strands facing upwards; to signify the value we will be bring to the client’s businesses. The name
“Threefold” itself is a synonym of the term “growth”.
The final logo and trademark shall appear as follows;

29
Figure 1. 5 Business Logo

30
 CHAPTER FIVE

FINANCIAL ANALYSIS AND PLAN

5.0 Introduction
Financial analysis empowers an association assess its financial position so as to build up its
ability to meet its financial commitments. This includes breaking down financial statements and
giving experiences on the position of the association undoubtedly.

5.1 Financial Accountability

Threefold Limited shall be publishing its accounts information annually, from July to June as of
the government’s accounting year. The company will depend on qualified consultancy agencies
for both accounting and audit services. Accounting activities will be automated using
QuickBooks Intuit Software to make it easier to track the company’s expenditure and cash
inflows.

5.2 Financial Objectives

Threefold’s financial objectives emphasize on the following areas;
 Finance self-sustenance; - The Company’s main aim is to move much closer toward
position of being able to fully sustain itself financially with regard to operations,
maintenance and development costs over the coming tenure of five years.
 Revenue growth; - Over the coming period of five years, the company will be expected
to grow at at least a pace of 65% per annum brought about by constant reinvestments and
expansion. Revenue growth will also come from expansion into other markets like
insurance and investment into other forms of investment vehicles like the stock market,
bonds and treasury bills. The business shall also seek acquiring stakes in other companies
to increase its revenues even further.
 Reinvesting of surpluses; - In the first years of operations, the company shall reinvest
most of its surplus revenues into internally financed projects aimed at growing the overall
organization.

31
  Eliminating competition; - After acquiring a desirable market share and financial
muscle, Threefold Limited will attempt to eliminate competition by deeply penetrating
into their markets as well as buying considerable stakes to gain control over them.

5.3 Financial strategies

Our financial strategies will be centered on acquiring capital, reducing operational costs, making
complex investment decisions and allocating capital accordingly to the chosen investments
through capital budgeting, working capital strategies in terms of accounts receivables, inventory,
cash management among others.
For both long term and short term operations Threefold Ltd will need capital to maintain her in
business. The business will therefore need capital for sustenance and to cater for operational
costs for the day to day expenses. Another need for capital will rise from the need for expansion
both internal and external into new markets through the proposed expansion areas.
The following strategies will ensure the business has capital for both overhead and expansion
costs;
a) Acquisition: - Purchasing of assets will not only increase the company’s wealth portfolio
but also reduce payable taxes to the government. Buying assets will lock a significant
amount of revenue that would have otherwise affected the amount of taxes payable to the
revenue authority.
b) Joint Venture: - This will involve Threefold Limited getting into investments with other
parties for internal and external investments as well into new industries. The company
shall also invest part of its annual revenues into acquiring stakes in other developing and
developed companies through preferential shareholding. This is expected to provide the
necessary capital needed for even more job creation, corporate social responsibility as
well as expansion into lesser occupied markets requiring huge investments such as the
insurance industry.
c) Ownership: - By being a privately held company, Threefold Ltd Will have more
credibility to its stakeholders; a professional status, an unlimited lifespan that won’t be
halted in case of death of anyone in the management, and a limitation for liability for
stakeholders.

32
Further financial strategies will be adopted in the course of running the business. Partly these
strategies will rely on professional consultations with agencies and corporate advisors. The core
purpose for having the strategies in place will be to enhance Return in Invested Capital (ROIC)
and for cash generation.

5.4 Pre-operational costs for two years

Table 1. 3 Pre-operational costs

Start-up Expenses (One-Time)

Permit and License 5200
Incorporation fees 10,200
Web design 39500
Brochure & Business Cards 12195
Signage 5000
Improvement on location 195000

Start-up Expenses (Recurring)

Rent 15000
Payroll 346200
Taxes 14 - 16%
Legal services 40000
Utilities 33100
Marketing cost 250000

Start-up Assets
Computers 320000
Office Equipment 693890
Office furniture 313680

TOTAL START-UP COSTS 2153965

Recurring monthly (x12) costs are
estimated to be at:

33
 Ksh. 684,300 per Month
Ksh. 8,211,600 annual recurring expenses.

Operational costs for two years will

therefore amount to:
Ksh. 16,423,200

5.5 Cash flow projections for two years

In the table below, I attempt to forecast the various ways in which Threefold Limited shall have
income flowing into and out of the business accounts inform of expenses.

Table 1. 4 Cash Flow Projections

1st 2nd 3rd 4th
Quarter Quarter Quarter quarter
Operating Cash in
Bank(Start) 1200000 1167300 197500 1145000
Cash sales 289100 142100 298900 431200
Customer Deposits 1465000 1320500 1665000 2150300
Bank Financing 0 0 0 0
Others 75000 25000 57500 442500

Total Income 3029100 2654900 2218900 4169000

Cash Outflow
Payroll 1008600 1008600 1008600 1008600
Rent 45000 45000 45000 45000

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Utilities 99300 99300 99300 99300
Taxes 12000 12000 12000 12000
Loan Payments 0 0 0 0
Others 5000 5000 5000 5000
Miscellaneous 2400 2400 2400 2400
Total Outflow 1172300 1172300 1172300 1172300
Cash flow deficit 1856800 1482600 1046600 2996700

The anticipated annual cash flow for the business operations is Ksh. 3,317,100. With a two-year
forecast of Ksh. 6,634,200.

5.6 Pro-forma income statement for two years

Pro forma income statement is the statement arranged by the business substance to set up the
projections of income and costs which they hope to have later on by following certain
suppositions, for example, rivalry level in the market, size of the market, development rate and
some more.

Table 1. 5 Pro-forma Income Statement

Pro-Forma Income Statement

Threefold Limited
For 2021 through
2022

REVENUE 2021 2022

Gross income 1207190 17142098

35
 0
Less income allowances 0 0
1207190
Net Income 0 17142098

OPERATING EXPENSES
Selling
Salaries and wages 4034400 4034400
Commissions 0 150000
Advertising 1000000 1200000
Other 35000 13000
Total Services Expenses 1035000 5397400

General/Administrative
Salaries and wages 4034400 4034400
Employee benefits 0 0
Payroll taxes 250000 361500
Insurance 0 0
Rent 180000 180000
Utilities 397200 397200
Depreciation &
amortization 0 0
Office supplies 95600 150000
Travel & entertainment 0 0
Postage 0 0
Equipment maintenance
& rental 0 0
Interest 0 0
Furniture & equipment 882570 882570
Total General/Administrative Expenses 5839770 6005670

Total Operating Expenses 6874770 11403070

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Net Income Before Taxes 1162730 5739028
162782.
Taxes on income 2 803463.92
999947. 4935564.0
Net Income After Taxes 8 8

Extraordinary gain or loss 0 0

Income tax on extraordinary gain 0 0

999947. 4935564.0
NET INCOME (PROFIT)
8 8

© Copyright, 2021-2022, Threefold Limited, All Rights Reserved.

37
5.7 Pro-forma Balance sheet for two years
A pro forma balance sheet sums up the projected future status of an organization after an
arranged exchange, in view of the current financial statements.

Balance Sheet

Threefold Limited

Assets 2021 2022

Current Assets

Cash
12,071,900 17,142,098
Accounts receivable
Inventory
Prepaid expenses
Short-term investments
Total current assets 12071900 17142098
Fixed (Long-Term) Assets
Long-term investments

Property, plant, and equipment

1,327,570 1,104,024

(Less accumulated depreciation)

223,546 143,571
Intangible assets
Total fixed assets 1551116.25 1247594.59
Other Assets
Deferred income tax
Other
Total Other Assets 0 0

Total Assets 13623016.25 18389692.59

38
Liabilities and Owner's Equity
Current Liabilities
Accounts payable
Short-term loans

Income taxes payable

162,782 803,464

Accrued salaries and wages

4,034,400 4,034,400
Unearned revenue
Current portion of long-term debt
Total current liabilities 4205242.2 4837863.92
Long-Term Liabilities
Long-term debt
Deferred income tax
Other
Total long-term liabilities 0 0
Owner's Equity

Owner's investment
3,500,000 3,500,000

Retained earnings
5,917,774 10,051,828
Other
Total owner's equity 9417774 13551828

Total Liabilities and Owner's Equity 13623016.2 18389691.92

{42}
Table 1. 6 Balance Sheet

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5.8 Break even analysis
Threefold Limited will use a breakeven analysis tool to determine at what point its services will
start being profitable. Or rather, we will use this analysis tool to determine how many positive
sales we will to close in order to cover for the expenses. Below we attempt to forecast the
breakeven point; -

Breakeven Analysis

Threefold Limited
Amounts shown in Kenyan Shillings
Sales
Sales price per unit 4,900.00
Sales volume per period (units) 296
Total Sales 1,450,400.00

Variable Costs
Commission per unit 0.00
Direct material per unit 0.00
Shipping per unit 0.00
Supplies per unit 0.00
Other variable costs per unit 0.00
Variable costs per unit 112.00
Total Variable Costs 33,152.00

Unit contribution margin 4,788.00

Gross Margin 1,417,248.00

Fixed Costs Per Period

Administrative costs 486,647.00
Insurance 0.00
Property tax 0.00

40
 Rent 15,000.00
Other fixed costs 0.00
Total Fixed Costs per period 501,647.00

Net Profit 915,601.00

Table 1. 7 Breakeven Analysis

Results:
Breakeven Point
(units): 105
Sales volume analysis:
Sales volume per period
(units) 0 30 59 89
Sales price per unit 4,900.00 4,900.00 4,900.00 4,900.00
Fixed costs per period 501,647.00 501,647.00 501,647.00 501,647.00
Variable costs 0.00 3,315.20 6,630.40 9,945.60
Total costs 501,647.00 504,962.20 508,277.40 511,592.60
Total sales 0.00 145,040.00 290,080.00 435,120.00
(501,647.00 (359,922.20 (218,197.40
Net profit (loss) ) ) ) (76,472.60)

Results continued…
118 148 178 207 237
4,900.00 4,900.00 4,900.00 4,900.00 4,900.00
501,647.0 501,647.0
501,647.00 0 0 501,647.00 501,647.00
13,260.80 16,576.00 19,891.20 23,206.40 26,521.60
518,223.0 521,538.2
514,907.80 0 0 524,853.40 528,168.60
725,200.0 870,240.0 1,015,280.0 1,160,320.0
580,160.00 0 0 0 0

41
 206,977.0 348,701.8
65,252.20 0 0 490,426.60 632,151.40

A breakeven result continues…

266 296
4,900.00 4,900.00
501,647.00 501,647.00
29,836.80 33,152.00
531,483.80 534,799.00
1,305,360.00 1,450,400.00
773,876.20 915,601.00

From the breakeven analysis illustration above, profitability of the company is forecasted to
prevail above 105 units (Sales closed). It is from this point that the company will start
experiencing profits from its operations.

5.9 Profitability ratios

Financial ratios are metrics for measuring a business’ financial health. With the aid of various of
these ratios, Threefold will be able to gauge its financial progress from time to time. The ratios
will also help in comparing Threefold Limited to its competition to gauge its strength relative to
the key players in the market. Using ratios often provides a standardized measure which is easier
to interpret. Below are some of the common ratio metrics we will use for this reason; -

5.9.0 Current Ratio

Current ratio under liquidity ratios measure a business’ ability to meet its financial obligations
when they fall due. For this type, current ratio is what we will use commonly since it indicates a
firms ability to pay short-term claims with short term assets.
2021
Current Assets
Current Ratio=
Current Liabilities
¿ 12,071,900
4,197,182
42
 ¿ 2.87
2022
Current Assets
Current Ratio=
Current Liabilities
¿ 17,142,098
4,837,864
¿ 3.54
The ratios show that Threefold Limited if were to be liquidated this year, the available assets
would be able to cover for all the current liabilities which is a good indication for a great sense of
direction for the company.

5.9.1 Working Capital

The working capital ratio quantifies an organization's productivity and the strength of its
momentary funds. The recipe to decide working capital is the organization's current assets less its
current liabilities.
2021
Working Capital=Current Assets−Current Liabilites
¿ 12,071,900−4,197,182
¿ Ksh .7,866,658
2022
Working Capital=Current Assets−Current Liabilites
¿ 17,142,098−4,837,864
¿ Ksh .12,304,324
Threefold Limited possesses a good indication of an uptrend movement of working capital.
According to this forecast, the uptrend is expected to continue in for another couple of years.
5.9.2 Asset-to-equity Ratio
Using this ratio, the higher the equity-to-asset ratio, the less leveraged the company is, meaning
that a larger portion of its assets are owned by the company and its investors.
2021
Total Assets
Assets−¿−Equity Ratio=
Owners Equity

43
 ¿ 13,623,016
9,417,774
¿ 1.45
2022
Total Assets
Assets−¿−Equity Ratio=
Owners Equity
¿ 18,389,692
13,552,828
¿ 1.36
Using this ratio, the higher the equity-to-asset ratio, the less leveraged the company is, meaning
that a larger portion of a company’s are owned by the company and its investors.

5.9.3 Debt-to-equity Ratio

Also referred to as simply debt ratio, it’s a leverage metric used to measure the relative amount
of funds that are supplied by equity and debt holders. The higher the amount of debt financing
relative to equity financing the more leveraged a firm is and the greater the risk its owners have
or faces. The business will not however use debt in the beginning but at a later stage we may
consider sourcing for debt to finance various areas such as expansion to enhance service delivery
as well as increasing revenue.
2021
Total Liabilities
Debt Ratio=
Total Assets
¿ 4,197,182
13,623,016
¿ 0.31
2022
Total Liabilities
Debt Ratio=
Total Assets
¿ 4,837,864
18,389,693
¿ 0.26
In this case debt ratio shows that the business isn’t financed on debt and therefore not leveraged
though possessing greater return if a need for debt rose.

44
We’ll use leverage ratios such as debt ratios to measure relativity of debt to equity funds used to
finance the firms operational assets.

6.0 Desired Financing

Over a period of the next three years, Threefold Limited will need Ksh. 24,634,800 to cover for
the expenses during this period. Currently the business will need Ksh. 8,211,600 of this amount.
The business shall not be financed by debt or investors and the owner shall remain the sole
investor for the business.

6.1 Proposed capitalization

Threefold Limited will be financed with an initial investment sum of Ksh. 3,500,000 by its
owner. This amount is expected to be raised through the Kenyan government Youth Fund
Program that is aimed at creating employment for local youths with suitable business ideas. The
business owner shall therefore be entitled to at least 100% of the company’s equity. Since I will
be the only financer during the start-up days.

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 CHAPTER SIX

CRITICAL RISK ANALYSIS

6.0 Introduction
In this chapter, I dive deep into the possible risks that the company is likely to face in the course
of its operations. From its interior which the management can control to those issues arising
externally in the general industry. I also discuss within how a country’s stability can and will
affect the business’s performance.

6.2 Operational risk

This is a business risk resulting from inadequate or failed internal processes, the people, systems,
or from external events. Causes of this variety of operational risks include; fraud, accounting
errors, equipment failure, or theft, mis-selling, product flaws and claims for unfair dismissal.
Operational risks are heavily dependent on human factors i.e. mistakes and failures due to
actions or decisions made by a company’s staff.

In particular, the following risk management approaches will be used to pinpoint as well as to
forecast a possible risk well in advance and set clear paths to follow to avoid the effects;

6.2.1 Risk and control self-assessment (RCSA)

It involves identification, evaluation and checks on the effectiveness of all significant risks and
the recording and reporting of the results.

6.2.2 Loss event monitoring

This will track events that lead to loss or near misses with the regular reporting. Management
can expand on these, particularly in near miss events which can be predictive of potential loss.

6.2.3 Key risk indicators (KRIs)

Tracking and monitoring this KRIs can provide early warnings of area of concern. Management
and regulatory team can then work on ways to mitigate these possible fatalities underway.

46
In general, management will attempt too closely and regularly screen all departments’ four
possible risks from operations being carried out and the decisions being made. It will also set
clear paths and measures be taken in the event of a risk that wasn't foreseen.

6.6 Industry risk

This form of risk set up danger to a firm not from within but from problems and issues involving
the entire industry that the firm operates in.

In the technology industry, technology and automation are a key driving force to those
controllers’ larger stakes. Companies that are not upholding technology or automating their
processes are finding themselves left out and beat up by their Savvy counterparts.

It's therefore, the management Duty to identify sharply and adopt much technological
advancement and use them to better both the company in improving its efficiency and customer
experience and to combat rising competition.

Threefold Limited shall therefore invest heavily in improving consumer experience and
satisfaction by constantly investing in training of staff members and in automating its services to
increase as well as faster delivery.

This will likely going to help up to attract new and maintain already existing client base.

6.7 Financial risk

A financial risk is the possibility of losing money on an investment or business venture.
Common financial risks include but not limited to credit risk, liquidity risk and operational risk.

Generally, credit risks involve company borrowing money from a given lender and due to some
reasons pick unable to pay. The Investor of the company in particular the owner will suffer
reduced income from loan repayments.

In the case of Threefold Limited we will try as much as possible to make debt the last option.
And in the event of needing debt financing, the Investment will be first evaluated and its risk
level defined and reported.

47
Otherwise, debt will remain our last option for financing any operation unless it’s perceived
return is greater than the risk involved and the odds to succeeding are relatively higher.

The other financial risk is the operational risk, often arising from poor management or flawed
financial reasoning bye a business’ employees. This risk halts a firm's operations.

6.8 Political risk

This is a risk that the business would suffer as a result of political changes or instability in the
country. The business he is entering a market for the long-term and it will be exposed to various
political surges in the long run.

Locally, threefold weave be faced with political issues such as political instability, legal and
Regulatory constraint, tax regulations changing from time to time, labor laws and to some extent
currency regulations.

It will be the management mandate to pinpoint this future failure risks and set clear policies to
reduce possible effects.

Such solutions will be including but not limited to; ensuring business has cash reservoir for risks
resulting to changes in tax structure, upholding employee welfare so as to avoid squabbles with
employee unions and always upholding honesty and transparency in service delivery .this will
avoid clients feeling scammed and ultimately not satisfied by our efficiency. It will also involve
reinvesting a significant portion of net income all the net profit to improving employee and
Company competency.

6.9 Economic risk

This is a chance that macroeconomic conditions search US government regulation or political
stability will affect an investment, in this case a business.

Occasionally, I will evaluate the macro environment of the business and attempt to identify this
risks that potentially might occur.

Industry in which threefold will be operating in may be affected by government regulations in

matters such as taxes, permits and operational halts due to the pandemic.

48
On average marketing will be performing well when other companies are performing well and is
likely to perform what with respect to others in industry. Therefore we will constantly do
research on-the-market of even our clients in order to attempt to provide them with adequate
information that will better them and their operations. This is because our client’s success will be
hours to share as well as successful businesses will always remember those outside parties that
helped them to acquire that success.

49
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Wold, D.P., & Riggenbach, D. (1996). NxLeveL guide for business start-ups. Denver, CO: U.S.

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KSUpersonalnetwork2.pdf

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