BEMACO DAIRY FARM

P.O.BOX642

MOBILENO.070937227

EMAIL:imalaenaz@gmail.com

TITLE : BUSINESS PLAN

PRESENTER : SIKO ENAYE

STUDENT NUMBER : 2022/BE/33181

Business plan presented to Kenya national examination counsel in partial

fulfillment of the award of Certificate in Social work.

SUPERVISOR : Mrs. Teresa Onako

DATE : NOVEMBER 2022

DECLARATION

TO: KENYATECHNICALTEACHERSCOLLEGE.

DECLARATIONFORMFORCERTIFICATEINTECHNICALTEACHEREDUCATION

NAMEOFTHEPROJECT: BUSINESSPLAN

THE STUDENT: SIKO ENAYE 2022/BE/33181

Be Declare that;

i. The project name above was approved by Kenya National Examination Council by Mr .
personally carried out the project whose report follows there after the declaration.
ii. Ireceivednounduehelpfromunauthorizedpersonsotherthanthenormalguidancefrommysuper
visor.
iii. I wrote the project unaided.
iv. ThereportsubmittedtoKenyaTechnicalTeachersCollegeismyoriginalwork.

Signature of the student…………………….Date……………………….

SUPERVISOR

Mr.……………………………………………..declare that I supervised the above student’s project

and the report contained herein..
ACKNOWLEDGEMENT

I wish express my heart felt thanks and gratitude to those who assisted me in making this
business plan a success .Without them I could not have accomplished the study ..May God bless
them abundantly.
DEDICATION

I here by dedicate this business plan to my classmates, dad , mum, my brothers sisters and all my
lecturers for guiding met through my technical teacher education course .May they live to
promote business ventures in their various fields of specialization.
TABLEOFCONTENTS

TOPIC PAGE

DACLARATION:…………………………………………………………………………i

ACKNOWLEDEMENT:……………………………………………………………….ii

DEDICATION:……………………………………………………………………………iii

CHAPTERONE

1.0 BACKGROUND:…………………………………………………………………….1

1.1 BUSINESSNAME:………………………………………………………………….1

1.2 BUSINESSLOCATIONANDADDRESS:……………………………………….2

1.3 FORMOFOWNERSHIP:………………………………………………………….3

1.4 TYPEOFBUSINESS:………………………………………………………….…..4

1.5 PRODUCT/SERVICES:…………………………………………………………….5

1.6 JUSTIFICATION:……………………………………………………………………5

1.7 THEINDUSTRY:……………………………………………………………………6

1.8 GOALSOFTHEBUSINESS:………………………………………………….……7

1.9 ENTRYANDGROWTHSTRATEGY:…………………………………………..…8-10

CHAPTERTWO

2.0 MARKETINGPLAN:………………………………………………….11

2.1 CUSTOMERS:………………………………………………………….11-13

2.2 MARKETSHARE:…………………………………………………………14
2.3 COMPETITION:…………………………………………………………15-17

2.4 METHODOFPROMOTIONANDADVERISEMENT:………………….18-21

2.5 PRICINGSTRATEGY:……………………………..………………………21

2.6 SALESTACTICS:…………………………………………………………….22

2.7 DISTRIBUTIONSTRATEGY:………………………………………………23

CHAPTERTHREE

3.0 ORGANIZATIONANDMANAGEMENTPLAN:……………………………24

3.1 ORGANIZATIONSTRUCTURE:……………………………………………24-29

3.2 REMUNERATIONANDINCENTIVES:………………………………………30

3.3 LICENCES,PERMITSANDBY-LAWS:……………………………………..31-32

CHAPTERFOUR

4.0 OPERATIONAL/PRODUCTIONPLAN:…………………………………………33

4.1 PRODUCTIONFACILTYANDCAPACITY:……………………………………33

4.2 PRODUCTIONSTRAEGY:……………………………………………………….35

4.3 PRODUCTIONPROCESS:…………………………………………………………37

4.4GOVERNMENTREGULATIONS………………………………………………37

CHAPTERFIVE

5.0 FINANCIALPLAN:…………………………………………………………………39

5.1 WORKINGCAPITALREQUIREMENT:……………………………………….….40

5.2 CASHFLOW:……………………………………………………………………….41
5.3 PROFOMAINCOMESTATEMENT:……………………………..……………….42

5.4 BREAKEVEN:……………………..………………………………………………45

5.5 EXPECTEDPROFITABILITYRATIOS:…………………………………………..47

5.6 DESIREDFINANCING:…………………………………………………………….48

5.7 PROPOSEDCAPITALIZATON:………………………………………………….…48
CHAPTERONE

1.0 BACKGROUND.
BEMACO Dairy farm will be owned by Bedan Maina .He comes from Murang’a County ,
Gatanga District, Kigoro Location ,Ndakai-ini Sublocation Njunu village .The owner
completed his primary education examination and passed well. He joined Thika highschool
in the year 2006 and did the secondary examinations in the year 2009 where he performed
well especially in Agriculture and business studies. Currently he is pursuing a Diploma
course in Technical Teacher education at Keya National Examination Council(KNEC).The
owner got motivated to venture into this business after having goood experience in his
learning programmers’ since primary level up to college level especially in farming and
business.
a) MISSION
To be a major producer of high milk , a product for local consumption.
b) VISION

To supplement the nutritional needs of the people in Thika to where are and demonstrate
to farmers that is possible to make profits from rearing dairy animals.

1.1 BUINESS NAME

The proposed business name is BEMACO Dairy Farm. It implies the initials letters of
the names of the promoter. The business choose this names easy to pronounce and
recall. Also the name can attract many people to the business leading to high sales.

1.2LOCATION AND ADDRESS

The business will be located in Njunu village which is twenty two kilometers from Thika town
along Thika, Ndaka-ini highway road adjacent to Njunu Tea factory. The location is on a private
farm which is away from loud noise and the environment suites dairy farming. Incidents of the
of will be minimized because the business has been fenced off with wire mesh and has
lockable gates. Dairy feeds will reach the farm easily because of good road network in the area.
The market centre which will mainly be Thika town will be easily accessed through good road
network in the area factor that will make it easier for milk to reach the market easily enough
and avoid milk from going bad as it is perishable product. The targeted customers like Njunu Tea
factory which has members of staff and workers who buy milk in plenty are near the premises.
Vetenary services will be easily accessed because of the good communication system within the
market area. The roads are well constructed, telephone network is also available. The population
in the area is estimated to be 45,000 people and it is growing rapidly because many people are
employed leading to high demand for milk products. One litre of milk will be sold at sh40/=a
piece that is affordable enabling people to use the remaining part of the income for other things
in the faming.

ADANTAGES OF THE BUSINESS LOCATION

The business will be near good market thus demand of services and ability to purchase the
product will be higher.

The availability of banking and insurances services in the location will enable the owner to keep
money and insure his business.

The business is located near social amenities such as schools, factory and churches.

BUSINESS ADDRESS

BEMACO DAIRY FARM

P.O.BOX648

THIKA.

TEL.0724890147

1.3.FORM OF OWNERSHIP

The business will be under sole proprietorship since it will be managed and owned by one
person. The Sponsor will gets of the funds from the family members to start the business.

Reasons for choosing sole proprietorship kind of business.

 I. The owner of the business will be in charge of the business operations since he will be
the manger.
II. The business will be easy to starts in required less legal formalities
III. He will be are all the losses and profits incurred..
IV. No action will be taken incase the owner dies since it was not involving many people.

1.4 TYPE OF BUSINESS

The business will be a start up kind of business and it will operate as a producer type of business
.The business will provide transport facilities so that the milk produced can be transported to the
market in good time so as to retain customers scandals or reduce chances of milk going bad.

The business will only deal with raw milk to the customers especially the Thika town residents
Njunu tea factory ,St Agnes High School who are the main targeted customers.

All the services will carried out within the business premises to give the customers full attentions
that their needs can be fulfilled.

1.5PRODUCTS/SERVICES

a) The main aim of the business is to produce high quality milk with a high butter fat
content to the customers. The business will also produce the following apart from milk
production.
b) Fully decomposed farm yard manure which will be sold to other farmers
c) Me at will only be obtained after curling old animal and those with undesirable traits like
poor mothering ability and poor body conformation.
d) The businesses will also provide educational facilities among the people in the area
which can motivate them to carry out dairy farming.
e) The business will also produce hides especially from the curled animals.

1.6JUSTIFICATION

1) The business will be viable because of the following reasons:

2) The area where the businesses will be located has no stiff competition which will lead to
high sales volume.
 3) The business will be located near the road leading to easy transportation of goods to the
market hence minimizing loses.
4) The business will offer quality and quantity products hence retaining the customers.
5) The business of banking and insurances services in the location will enable the business
to keep money safely and in sure its against things like theft and fire.
6) The business will succeed because it will be located in a well secured place.
7) There is higher demand for the product in the area leading to high sales.

1.7INDUSTRY

The proposed business shall be a production industry dealing in production of milk and fully
decomposed manure for the customers.

a) Size of the Industry.

The proposed business shall be as small scale business selling its products to customers
within Thika town and home areas. The rear large farms in the market area .The business
shall be processing 3000 liters of milk per month. Therefore per year shall be
3000x12=36000litres.The amount of manure produced per year shall be 5000kgs.The
business does not have a vehicle for marketing its products but only motorbikes owned
by the owner.

b) Characteristics of the business

The level of technology used in handling the products will be located as the animal
will be milked by men but not machines. Machine will be used after expanding the
business.

c) Capital Requirement

The basicrequirementfortheentryinthebusinessshallbeksh.800,000 with the owner of the

business contributing Kshs400,000 friends and relatives contributing ksh400,000 and
bank loan from cooperative bank of Kenya Kshs100,000

d) Industrial shift Growth

 The region has similar forms of industries .There are less than 15 of them. Most of the
industries are smalls scale based which lack proper equipment for keeping milk. The
industries growth of this business is improving from 5% to 10% within a period of
10years.

1.8GOALS OF THE BUSINESS

I. The goals to be achieved as per the plans of the business areas follows:
II. To supplement the nutritional needs of the community around Shinyalu by providing
enough high quality milk at the start of the business.
III. To demonstrate to farmers that it is possible to make profits from keeping dairy animal as
compared to production of maize which is common in the area.
IV. To satisfy the customers’ needs and wants to improve the standard of living by earning
more profits hence creating employment to other people as the business will employ
some [personnel to help in wining some of the activities and also improve the learning
habits among people.
V. To support income to self and employees by making the business profit oriented.
VI. To expand the business through offering high quality products to the customers.
VII. To creates employement to the owner and other people within the community.

1.9ENTRYANDGROWTHSTRATEGY

a) Entry Strategy

The business intends to commence asper 2/2/2025. This adteis scheduled because the
business will have gotten the opening capital from various sources. The Methodist to
introduce the business into the market and penetrate include:-advertisement through
posters ,radios ,newspapers and use of signboards.

Costs to incurare:

Posters Kshs1000

Radio Kshs6000

Newspapers Kshs500
 Signboard Kshs500

The business research carried out found out that the dates for the business will be
more convenientas it will enable the business to have the proper plan of all the
activites of the year.Also through there search carried out it was discovered that
during this month of they market normally has few competitors.

b) Maturity Stage
1. The business will prove to have matured through the following:
2. The business will have gotten recognition by having many customers which will increase
the sales volume leading to increase in profit generation.
3. The business will have attracted more customers though offering high quality products.
4. The business will have commenced investing part of the profits gained in banks.
5. The business will prove to have matured by retaining the additional customers by having
good public relation.
c) Growth Strategy

According to the growth and expansion , the business intends to open new branches
after a period of three years. The following are the areas where new branches will be
established.

1. Thika to wnarea- behind uchumis upper market

2. Gatanga centre-marketplace

The business will also ensure proper growth by investing more shares in the stock
market.for the business to succeed , it will employ qualified personnel and use of
modern equipment like the new milking machines as to make work easier , hence
saving on human labor . The new branches to be opened will also be the selling points
of the products.
CHAPTERTWO

2.0MARKETINGPLAN

2.1CUSTOMERS

BEMACO Dairy Farm will be targeting a wide range of customers, among the the following:

i. Domestic customers
ii. Institutional customers
iii. Commercial Customers
a) Domestic Customers

They are the people living 3km from the premise. Since the market is the entire Ndaka-ini
location which measures 5km square .The local people will gain access to the production and
services of BEMACO dairy Farm. The domestic consumer includes:

Number

a) Primary school teachers 20

b) Factory workers 300
c) Local farmers 100

The consumers buy milk for their own consumption directly from the farm in most situations
they buy milk when they have been paid their salaries from their working stations.

They buy milk during the cold months of June and July. These are cold seasons where most
people take a lot of hot tea to keep them warm.
The domestic consumers usually buy in small quantities averaging to a maximum of 3 bottles of
milk per person. Previously they have been buying from Peters Farm which now cannot provide
enough milk because of poor management and there were complaints that the milk from Peters
farm was of poor quality placing BEMACO Dairy Farm in a better position to excel. The
customers are now buying from BEMACO because of good packaging and having quality
products which satisfies their needs.

b)Institutional Customers

BEMACO Dairy Farm will be the neighbor to Shihuli primary school land St Agnes Secondary
school which are adjacent to one another and are 200m From Tamu Tamu Dairy Farm.

c)St Agnes High School

It has a population of 1200 students with staff of 166.This school will be buying milk everyday
in the evening for the students breakfast. The staff members will be taking their milk every day it
the morning.

d) Shihuli primary school

Shihuli Primary school has a population of 1000 pupils and staff of 200. The school will buy
milk in the evening in preparation for the pupil’s breakfast. The school will be organizing on
how the milk will reach to the schooling time.

Commercial customers

The commercial customers comprise of business men who buy the milk in large quantities and
sells to customers. They will be the largest group of customers to BEMACO dairy Farm. Among
the mere:

Kiosk Owners in Town

They buy milk everyday but they buy towards the end of every month when most people have
been paid their salaries. The kiosk owners will becoming to collect milk by use of bicycles hence
reducing transportation costs for BEMACO.

Retail Shops .

They buy milk in large quantities especially at the end of the month when many people have
been paid their salaries. They sell milk to some of the of the kiosk owners who will not have
taken from the main farm. BEMACO Dairy Farm will organize on how to transport the milk to
the retailers.

When sales volume is high the business expect to sell up to 120 litres of milk per day
bringing an amount of Kshs6000/=at a cost of 50/=per litre.

2.2MARKETSHARE

In comparison with other competitors in the market BEMACO Dairy Farm will contribute to the
market as shown in the table below:

FIRM OUTPUT SELLINGPRICE SALESPERMONT %SHARE

LITRES PERLITRE H
SHADRACK 2500 50 125000 21%
KERUBO 2800 50 140000 23%
MARK 1300 50 65000 11%
JOSEPH 2210 50 110500 18%
BEMACO 3200 50 160000 27%
TOTAL 600,500 100%

From the table above:

Sales volume=cost per units produced per month

Market share=salesolumex00

Total sales volume

Thetargetofthebusinessistohaveadominantsharebysatisfyingtheneedsofcustomers.Fromtheabovei
nformationBEMACOFarmhasahighpotentialofattainingitsgoalowingtothefactthatitisastartupandit
sclosestcompetitor(kerubo)isalreadyatitsdeclinestage.Thebusinesshopestobetheleadingfirminthes
aleofdairyproducts(milk)withinthelocality.Hencethebusinessprojectionanincreaseinmarketsharesf
rom27%to40%in2yearsperiod.

2.3COMPETITION

Someofthecompetitionswithinthemarketare:

ShadrackFarm

Kerubo

MarkFarm

JosephFarm

KeruboFarm

Itisoneofthelargestoffarmsinthearea.Itsuppliesabout8000litresofmilkomonthwhichisKshs4000,00
0/=.Itislocated3kmfromBEMACOFarm

Businessstrength

Theysupplytheirmilkimmediatelytheymilk.Themilkfromthefarmisofgoodqualityhavinghighbutter
fatcontent

Theyareabletoofferdiscountdependingonthenumberoflitresbought.

Weakness

i. Milkgobadeasilyduetopoorstorage
ii. Poormanagementleadingtolowproductivityhencelowprofits.
iii. ShadrackFarm
iv. Itisanotherfarmwhichsuppliesmilktothemarket.ITissituated5kmawyfromBEMACODairyF
arm.

Strength
 i. Itsuppliesmilktothemarketingoodtime
ii. Itoffersdiscountsdependingontheamountoflitresbought
iii. Itproducesfullydecomposedmanureforitscustomers.
iv. Weakness
v. Themilkisoflowbutterfatcontent
vi. Locatedinremoteareawheretransportationispoormakingmilktogobadeasily.
vii. Milkproducedisoflowqualityascomparedtootherfarms
viii. Sometimestheyrunshortoffeedsleadingtolowproduction

Josephfarm

Itismediumproducingfarmlocated3kmfromBEMACO.

Strength

i. Itisnormallyopentoallcustomersatanyappropriatetimetheyneedtobuymilk.
ii. Itproducesgoodqualitymilkproduct
iii. Itdoesproper’sadvertisementoftheproduct
iv. Weaknesses
v. Poormanagementofthefarmladingtoinfestationofdiseasesandparasitesthatincreasescostsofp
roduction
vi. Theydonotkeepclearrecordsonproductionperanimal
vii. Profitabilitymarginislowduetothesmallnumberofanimalskept.

WAYSOFOVERCOMINGCOMPETITION

i. BEMACODairyFarmwillovercomecompetitionthroughthefollowingways.
ii. Thebusinesswillproducegoodqualityandquantityproductsthatwillattractmostofthecustomer
shenceincreasingthesalesvolume.
iii. Thebusinesswillalsoensurethatthepublicrelationswiththecustomersisgoodsoastoretainthem
iv. Thebusinesswillovercomecompetitioneasilybecauseitislocatedatthecentreofthemarkethenc
eenablingmostofthecustomers’accesstoit.
v. Thebusinesswillalsoensurethatithasproperpackagingfacilitiesthatcanenablecustomerstotra
nsporttheirgoodseasily.
 vi. Attractingandretainingmorecustomersthroughelaboratesalesandmarketingprogramscarried
outregularlyandtheirperformanceevaluatedmoreoften

2.4METHODSOFPROMOTIONANDADVERTISEMENT

Sincethebusinessisstillrelativelynewthereisneedtoattractcustomersbycreatingawarenessoftheexist
enceofthebusiness.Severalmethodswillbeusedtocreatethisawareness.Theseinclude:

Advertising

Wordofmouth

HousetohousevisitwillbeconductedbythebusinesstomakewellknownofBEMACODairyFARM.Thi
swillcontinueuntilthebusinesshasbeenwellestablished.ThecosttoincurforthisprocessisKshs300per
month.

a) Posters

Thepeopleinlocalmarketwillgettheinformationthroughpostersthatwillbemountedonthewallsofshop
s.Productsthatwillbesoldwillbeindicatedandtheirpricesanddiscountsavailablethatwillbeoffered.Thi
swillamounttokshs.800/=permonth.

Contentoftheadvert

i. Wherethefarmislocated
ii. Theproductsoffered
iii. Thepriceoftheproducts
b) Media

Beingnewinthemedia,citezenFmwhichhasnowgainedpopularityamongthepeoplewillbethemostreli
ablesourceofadvertising.Thebusinesswillspendaboutkshs1000/
=forthisadvertanditwillbeadvertisedforatleastonemonth.

Content

Content of the advert

i. Where the farm is located

ii. The products offered
 iii. The price of the products
iv. Discount offered by the business
c) Local dailies

The business will use the local dailies the Thika times type of news paper to advertise the
products .The products to be sold will be indicated together with discount to be offered. The
business expectors spend about Kshs500 per month.

Content

i. Where the farm is located

ii. The products offered
iii. The price of the products
iv. Discount offered by the business

PROMOTIONSTRATEGY

BEMACO Dairy Farm is aiming at serving as many customers as possible.This important for the
business without customers ,it cannot run efficiently.

For continuity and maintenance of efficient services to customers the business will promote
itself to attract more customers in order for them to buy more hence increases sales volume. One
of the by providing free means of transport of milk.

Manure will be given out for free to those willing to enrich their lands . This will be within the
early stages of establishment about one month hence attracting customers. The business will also
provide the following promotional campaigns as to attract more customers .Free samples ,trades
shows and sponsoring games .All the activities will be offered to the customers and they will
also be allowed to participate activities like games and trade shows.

2.5PRICINGSTRATEGY

Some of the factors that will influence the setting of selling price are:

i. Cost of production like animal feed ,buildings to land labor

ii. Market demand for milk.

SUPLYASPECTOFTHEPROODUCT
The price for the 1litre milk will be kshs50/= considering the above aspect ,it is the cheapest
price possible which acquire profit ensuring fast selling of the milk.

2.6SALESTACTICS

Products from BEMACO Dairy Farm will be sold in different ways…

Direct selling to customers

The business will ensure that its supplies milk to the customers who are near the business
premises. Indirect selling through agents.

Three men will be distributing milk to distant customers within 3km radius and they will be paid
on commission depending on sales made. The commission will be paid in weekly basis .Initially
they will be paid kshs500 each totaling to kshs1500 from every kshs2000 they will make ,they
will be paid 200/=bring to the cost of kshs2100.

The sales team will be recruited by setting up an advertisement for people to apply and those
who have qualified with the required documents will be considered.

2.7DISTIBUTIONSTRATEGY

BEMACO Dairy Farm will distribute its product to the customers using the following channels.

CHANNEL OF DISTRIBUTION

Producer Consumer

Producer retailer consumer

Road will be used as means of transport where matatus will be used for longer distances and
bicycles or carts for shorter distances. The matatu will be used only when the milk has
accumulated so much and are excess in local market.

The expected cost of transportation will be determined by the distances from the source and the
customers. It is estimated to be Kshs3,500permonth.

Total cost of methods promotion is

PostersKshs800/=
CitezenfmKshs1,800/=

LocalnewspaperKshs500/=

DistributionstrategicallyKshs3,500/=

Totalcostiskshs6,600/=

CHAPTERTHREE

3.0 ORGANIZATION A LAND MANAGEMENT PLAN

INTRODUCTION

Management is the process of administering and coordinating resources effectively, efficiently in

effort to achieve by using the fewest inputs e.g. people and money to generate a given output.

The organizational management design will contribute to the quality services output .The
management team will comprise of the general manger ,accounts clerk ,salesman ,store man and
watchman.

3.1 ORGANIZATIONALSTRUCTURE

GENERAL
MANEGER

ACCOUNTS SALES
CLERK MAN
3.2STAFFINGANDTHEIRQUALIFICATIONS

GENERALMANEGER

Qualifications

 Should be a diploma holder in Agriculture

 Should have skills and experience in Agribusiness and management field
 Should be computer literate
 Should have an experience of three years in the field.
 Duties and responsibilities
 Carry out the planning good time
 Should call experts where necessary
 He should make informed decisions
 Be able to make more profits
 He should be innovative
 He will be responsible for advisory services to the members of the organization

OTHERPERSONNEL

Accounts clerk

Qualifications
  Should be a diploma holder in accountancy
 Should be computer literate
 Should have experience in the related field for at least three years.
 Duties and responsibilities
 Prepare the farm budget and employees wages
 Prepare monthly financial statements of the business transactions
 Keeping financial records for future use
 Detect any loss early as possible
 Salesperson

Salesman

Qualifications

 Should have a certificate in sale and marketing

 Should have at least one tear experience in the field
 Should be computer literate.

Duties of the salesman

 Carrying out market research

 Conducting all business advertisement and promotion
 Should keep proper records about sales

Watchman

Qualification

 Must be a holder of “O” level certificate

 Should be healthy
 Should have a certificate of good conduct
 Duties guard the premise and the store

Store man

 Should be a certificate holder in agriculture

  Should have two years experience in the field
 Be computer literate
 Be able to keep daily records
 Should be at least 35 yearsold

Duties

 Be able to arrange the store properly

 Should inform the management when stock levels are low for replacement
 Shouldbe30yearsofage

3.3RECRIUTMENTTRAINING AND PROMOTION

Dairy farm will only recruit employees incase of resignation, death and sacking. The farm will
only recruit employees through advertisement, posters and after receiving the application letters.
The applicants will be interviewed and those who qualify will be chosen. After choosing
orientation day will be organized so as that each employee will be shown his area of concern.

i. Work performance.
 The employee will be expected to be at working station before 8.00am and leave
at5.30pm
 Each employee will be expected to keep personal cleanliness especially when handling
products like milk.
 All employees will be expected to be self disciplined to the whole staff and when
handling customers.
 All employees will be expected to be honest and keep all the office attributes.

ii. Training

BEMACO dairy farm being learning centre will organize some trainings so as to up grade the
employee’s skill of work. The following will be implemented by the farm to ensure proper
learning takes place:
  The staff members will be allowed to attend all seminars concerning the agricultural
sector
 The staff will be promoted to attend short courses so as to boost their managements kills
hence high profits.
 Vocational training like workshops will been courage so as to enable the staff members
acquire new ideas from other people who come from more developed areas.
 The trained staff will be promoted after one year of heir training.

TRAINIGSCHEDULE

PERSONEL TRAININGPERIOD DURATION

GENERALMANEGER During April vacation 2weeks
ACOUNTSCLERK During August holiday 2weeks
SALESMAN During December holidays 3weeks
WATCHMAN During December holidays 2weeks

3.4REMUNARATION ,SALARIES AND INCENTIVES

An incentive is a token of appreciation above the pay for normal work hence the business will offer the following incentives to employees.

TITLE MONTHLYALL MEDICALALL COMMUTERAL HOUSEALLO TO

OWANCE(KSH OWANCE(KSH LOWANCE(KSH WANCE(KSH TA
S) S) S) S) L
GENERA 8,000 1,000 1,000 2,00 12,
LMANAG 00
ER
ACCOUN 5,000 200 300 600 6,1
TSCLERK 00
SALESM 4,500 350 400 400 5,6
AN 50
STOREM 3,500 200 200 100 4,0
AN 00
WATCHM 2,500 100 100 200 2,9
AN 00
TOTAL 30,
65
0

Other incentives that the farm will offer to employees include:

 All employees will be rewarded by the management team for their good [performance at the end of the month
  The employees will receive loans from banks organized by the management team which they will be paid by them an age for every
employee hence he loans will enable the employees to improve their living standards .By giving out incentives , the employees will be
motivated to perform their duties which will improve the production of the enterprise.

3.5LICENSES, PERMITS AND BY-LAWS (LEGAL REQUIRMENTS)

BEMACODairyFarmwillrequirelicensethatwillenableittorunsmoothly.ThelicensewillbeobtainedfromMurangacountycouncil,hencethecostoftheli
censewillbekshs2000/
=.ThebusinesswillrequireanotherlicensefromthelocalauthoritywithinMurangacountythatwillenableittosellitsproductsintheopenmarket.

BUSINESSCONTROLOFASSETS.

Financialmanagement

Itwillbeundertheaccountsclerk.Hewillberesponsibleforallfinancialstatementsofeverydepartmentthroughhisrepresentativesinthevariousdepartmen
ts.

Insurance
The business will also in sure all the assets against the that incase the enterprise gets into
problem the insurance company will provide funds for the business to continue .The business
expects to spend ksh5000 per year.

Support Services

The following supporting staff and services will help the business to run smoothly.

a) Banking services

The finance officer will ensure that all the funds of the enterprise is kept in the bank for security
purposes, hence enterprise will there for open an accounting the bank to be depositing their
funds. The business expects to spend kshs100 for opening the account.

b) Accounting Book Keeping

The services will be found in the business under the management team .Keeping will be under
accounts clerk and will include:-

Record keeping of viable financial statements .The business expects to spend kshs500 per year.

c) Management Advisors.

The management team will be responsible to ensure that all the enterprise activities runs
smoothly and in case of any obstacle the team will cooperate to seek for a proper solution. The
general manager will also call experts from other dairy farms form o reconsultations. The
business expects to spend kshs2000 for process.
CHAPTERFOUR

4.0 OPERATIONAL PLAN

The operation all plan will be a guide on how the enterprise will be operating on a day to day
basis. The general objectives being the achievement of the goals of the business and more so
to satisfy customers.

4.1PRODUCTION DESIGN AND DEVELOPMENT

The intended product design and development product will be improved to increase when the
product (milk) is obtained. The product will retain more butter fat content proteins,
carbohydrates and its original color (white) packings shall be properly incorporated and
organized as to avoid losses during transportation of the product. Cleanliness will be maintained
and no other artificial chemicals added to the milk so as to maintain best quality.

IV.2 PRODUCTION FACILITY AND CAPACITY

The production facilities and equipment are the necessary tools required in production of clean
milk enabling the business to run through every day in its production and also enable efficiency
in production.

The table below shows there acquired facilities for the proposed business.

Table of production facilities and capacity.

FACILITY NUMB DATEACQUI SOURCE CAPAC UNITCOST( TOT

ER RED TY SH) AL
BUCKETS 50 3/1/2015 Ingo stores 20litres 300 15,00
0
FILTERS 5Pcs 2/1/2015 Mwala 100 500
stores
MILKINGJELLY 5bottles 1/2/2015 Jaribu 200 1000
stores
STRIPCUP 2pairs 1/2/2015 Ngelani 1200 2400
agrovet
LACTOMETRE 4pairs 1/2/2015 Ngelaniagr 800 3200
ovet
WEIGHINGSCA 2pcs 8/3/2015 Ngelaniagr 1200 2400
LE ovet
MILKINGMACH 2pcs 8/3/2015 Ingo stores 4000 3000
INES
WHEELBARRO 1pc 3/1/2015 Jaribu 3000 3000
W stores
TOWEL 1set 4/3/2015 Ngelani 3000 38,50
agrovet 0
TOTAL
BEMACODAIRYFARM

A plan of a zero grazing unit for the dairy animals and the young stock.

IV.3 PRODUCTIONSTRATEGY

The monthly materials required areas shown in the table below:

MATERIAL QUANTITY PRICEPERITEM TOTAL

Water 3000litres Available on the farm -

Dairy meal 300kgs 1kg=kshs75/= 15,000

Molasses 50litres 80 4000

Napier Grass 5tones 1000 5000

Table on monthly labor requirement.

Labor Number Monthly payment

General manger 1 8000
Account clerk 1 5000
Salesman 1 4000
Watchman 1 3000
Herd man 1 3000
Total 23,000

The monthly production expenses are:

Monthly Production expenses Monthly payment

Transport 2000
Water -
Electricity 1800
Postal services 1500
Telephone 1200
Repair and maintenance 1000
Total 7,500

Monthly cost of production

This is the sum of the monthly material requirement labor and monthly production
Expenses. The table below is showing the information.

Monthly expenses Amount in cash

Monthly material requirement 24,00
Monthly labor requirement 23,00
Monthly production expenses 7,500
Total 54,500
IV.4 PRODUCTION PROCESS

STAGES FOLLOWED IN MILKING PROCESS

ALL ANIMALS ARE CONFINED

STAGE1

ANIMALS ARE RESTRAINED IN CRUSHES FOR

STAGE2 MILKING

FILTERING OF THE MILK AFTER MILKING

STAGE3

PACKAGING OF MILK AND MARKETING.

STAGE 4

IV.5 GORVERNMENTREGULATIONSAFFECTINGOPERAT
IONS
 i. Safety Regulation Act

Safety regulation Act entails safety during working hours. People working must put on garments,
gumboots, working areas should not be congested or dump places or electricity appliances
should be well fitted without loose wires hanging out which might causes hock.

ii. Environmental Regulations Act

The government Act advocates that careful consideration and protective measures should be
undertaken to protect to natural environment, pollution should be fully minimized and
environmental conservations should be practical by avoiding deforestation and pollution of water
catchment.

iii. Health Regulation Act

The health Act entails that maximum cleanliness is maintained. The walls of the buildings should
be painted, the floors should be clean and all the workers should be clean and having health
inspection certificate to avoid any contamination or anything that maybe a health hazard to the
consumers of the product. Health inspections should be carried out at random to ensure that
products and the working place are clean.

�
CHAPTERFIVE

5.0 FINANCIALPLAN

These are costs which are incurred before the business commences its operation.

ITEM UNIT AMOUNT(kshs)

FIXEDASSETS
Bicycles 6 21,000
Furniture 30,000
Feed in equipment 2000
Milk in equipment 10,000
Electricity and water 2,500
Legal fee 2000

Insurance fee 1000

Consultancy fee 500

Total 69,000

5.2WORKINGCAPITALREQUIREMENT

Thisispartoffinancialplanwhichshowsthefundsrequiredforthedaytodayrunningofthebusiness.

ITEM YEAR2016 2017 2018

Stock of raw materials 288,000 340,000 680,000
Work in progress - 70,800 183,500
Stock of finished goods 4,500 54,00 138,800
Debtors 52,000 8,400 27,500
Cash in hand 12,600 2,100 33,400
Cash at bank 23,700 6,800 19,800
380,000 431,100. 1,136,200
5.3BEMACODAIRYFARMPROJECTEDCASHFLOWSTATEMENTFORTHEYEARENDINGDECEMBER2016

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC TOTAL
Cash flows
Cash sales 180,00 190,000 222,000 250,00 260,000 240,000 250,000 230,000 200,000 200,00 19000 1800 259,000
0 0 0 0
Collection 2,000 2,500 3,000 3000 4000 5000 5500 60,000 6000 7000 8000 52000
from debtors
Others(sale of 2000 3000 500 1000 11000
manure)
Total cash in 180,00 192,000 222,500 255,00 26,300 244000 258,,000 235,500 206,000 211000 19700 189,0 2653600
flow 0 0 0 00
Cash out flow
Cash 20,00 15,000 12000 1500 14000 12000 18000 18000 150,000 18000 15000 1600 1888,000
purchases 0
Payment to 3,500 2,500 3500 1000 9500
creditors
Telephone 400 400 400 400 400 400 400 400 400 400 400 400 4800
Salaries and 27950 27950 27950 27950 27950 27950 27950 27950 27950 27950 2795 27950 3335400
wages 0
Rent 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 12000
Electricity & 2,500 250 2250 2350 2400 2450 2000 2100 2200 2250 2400 2400 27550
water
Advertisement 3400 3400 3400 3400 3400 3400 3400 3400 3400 3400 3400 3400 40800
Postage 1,200 1200
Transport 800 800 800 800 800 800 800 800 800 800 800 800 9600
Stationary 1200 1200
Total cash 58450 50800 47800 54400 49950 48000 53550 56150 50750 33800 5445 51950 630050
flows 0
Net cash 121550 141200 174700 200600 213050 196000 205450 179350 155280 157200 1425 13705 2022950
balance 50 0
Cash balance 121,55 121,550 121,550 121,55 121,550 121,550 121,550 121,550 121,550 121,55 121,5 121,5 2022950
B/F 0 0 0 50 50

Accumulative 262,750 437450 638050 851100 104710 1251550 143900 1586150 178615 1888 20229
0 0 5900 50
5.4BEMACOINCOMESTATEMENTFORTHEYEARENDINGDECEMBER31ST2016

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC TOTAL
Total sales 1800 19000 186000 195000 230000 211000 197000 180000 155000 176000 192000 222000 2314000
00 0
Add purchases 2000 16500 168000 18000 18300 19500 16200 16250 17300 19000 19300 19800 516650
0 0
Less closing 1800 1500 200 1400 1250 1000 1800 1800 1420 2000 800 1500 16470
stock
Less closing
stock
Electricity & 2500 2250 2250 2350 2400 2450 200 2100 2200 2250 2400 2400 25750
water
Salaries and 2795 27950 27950 27950 27950 27950 27950 27950 27950 27950 27950 27950 335400
wages 0
Rent 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 12000
Veterinary 1800 1800
services
Telephone 400 400 400 400 400 400 400 400 400 400 400 400 4800
Advertisement 3400 3400 3400 3400 3400 3400 3400 3400 3400 3400 3400 3400 40800
Stationary 1200 1200
Postage 1200 1200
DepreciationofP 2750 2800 2850 2900 2950 3000 3050 3100 3150 3200 3250 3300 36300
A
Repair&mainta 1000 1050 1050 1800 1850 1800 1700 1900 1950 1800 2000 17900
nce
Consultancyfee 500 500
Insurance 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 1200
Legalfees 2000 2000
Totalexpenses 4390 39800 39900 40050 40900 41050 40600 40650 42800 43150 41200 41450 495450
0
Netprofitbeforet 1543 16520 160900 171550 206350 188450 170800 159800 129080 149850 169300 19850 1845430
ax 00 0
Netprofitafterta 1388 14868 144810 154395 185715 169605 153720 143820 115272 134565 152370 178965 1820787
x 70 0