BUSINESS PLAN

NAME :PATIENCE’S GRAPHIC DESING

CENTRE : RIFT VALLEY TECHNICAL TRAINING INSTITUTE

CENTER NUMBER :

INDEX NUMBER :

PRESENTER : PATIENCE CHEPKIRUI

PRESENTED TO : KENYA NATIONAL EXAMINATION COUNCIL IN

PARTIAL FULFILMENT OF THE AWARD OF

DIPLOMA IN INFORMATION COMMUNICATION

TECHNOLOGY

SUBJECT CODE :

SUPERVISOR :

SERIES : MARCH

1
 DECLARATION
I hereby declare that the contents of this business plan are my own work and that no part of it has
been captured from elsewhere. This work is presented to the Kenya national examination council
as part of the requirement
Name of the student: ………………………………
Signature :
Date :

This work has been presented with the approval of my project supervisor
Supervisor : …………………………………………..
Signature :
Date :

i
 DEDICATION
I would like to dedicate this business plan to my entire family for their entireness efforts in
financing and even moral support in marking sure that this business plan is a success

ii
 ACKNOWLEDGEMENT
I would like to acknowledge the immense support I have received during writing of this project.
My supervisor for the committed guidance from the start to the end of the project. I also
acknowledge my loving Parents for financial support, also my friends for encouraging me
throughout my research.

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Contents
DECLARATION...............................................................................................................................................i
DEDICATION.................................................................................................................................................ii
ACKNOWLEDGEMENT.................................................................................................................................iii
Executive summary....................................................................................................................................vii
1.0 Business description.............................................................................................................................vii
2.0 MARKETING PLAN................................................................................................................................vii
3.0 Operational plan and production.........................................................................................................vii
4.0 Organizational plan..............................................................................................................................vii
5.0 Financial plan......................................................................................................................................viii
CHAPTER ONE..............................................................................................................................................1
1.0 BUSINESS DESCRIPTION.........................................................................................................................1
1.1 NAME OF THE BUSINESS........................................................................................................................1
1.2 BUSINESS LOCATION..............................................................................................................................1
1.3 BUSINESS OWNERSHIP..........................................................................................................................2
1.4 FORM OF OWNERSHIP...........................................................................................................................2
1.7 INDUSTRY..............................................................................................................................................2
1.8 JUSTIFICATION OF OPPORTUNITY..........................................................................................................2
1.9 BUSINESS OBJECTIVES AND GOALS........................................................................................................2
LONG TERM GOALS.....................................................................................................................................2
SHORT TERM GOALS....................................................................................................................................2
ENTRY AND GROWTH STRATEGY.................................................................................................................3
GROWTH STRATEGY....................................................................................................................................3
CHAPTER TWO.............................................................................................................................................4
MARKETING PLAN.......................................................................................................................................4
2.0 POTENTIAL CUSTOMERS........................................................................................................................4
2.1 COMPETITION........................................................................................................................................4
2.2 MARKETING.......................................................................................................................................4
2.3 SALES TACTICS.......................................................................................................................................5
2.4 ADVERTISEMENT...................................................................................................................................5

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PROMOTION................................................................................................................................................6
2.5 PRICING STRATEGY................................................................................................................................6
2.6 DISTRIBUTION STRATEGY......................................................................................................................6
CHAPTER THREE..........................................................................................................................................7
3.0 ORGANIZATIONAL MANAGEMENT PLAN...............................................................................................7
3.1 MANAGEMENT TEAM............................................................................................................................7
3.2 OTHER PERSONNEL................................................................................................................................8
3.3 RECRUITMENT, TRAINING AND PROMOTION OF PERSONNEL..............................................................8
RECRUITMENT.............................................................................................................................................8
TRAINING.....................................................................................................................................................8
PROMOTION................................................................................................................................................8
3.4 RENUMERATION AND INCENTIVE FOR PERSONNEL..............................................................................9
RENUMERATION..........................................................................................................................................9
3.5 INCENTIVES............................................................................................................................................9
3.6 LEGAL REQUIREMENT............................................................................................................................9
CHAPTER FOUR..........................................................................................................................................10
4.0 PRODUCTION AND CO-OPERATION PLAN INTRODUCTION.................................................................10
4.1 FACILITIES............................................................................................................................................10
EQUIPMENT...............................................................................................................................................10
4.2 MAINTAINANCE AND REPAIR..............................................................................................................10
4.3 PREMISE LAYOUT.................................................................................................................................11
4.4 PRODUCTION AND OPERATIONAL STRATEGY......................................................................................11
PRODUCTION DEVELOPMENT...................................................................................................................11
4.5 MONTHLY MATERIAL REQUIREMENT..................................................................................................11
4.6 MONTHLY LABOUR REQUIREMENTS...................................................................................................11
4.7 MONTHLY PRODUCTION/OPERATION COST........................................................................................12
4.8 PRODUCTION PROCESS........................................................................................................................13
4.9 RELEVANT REGULATION......................................................................................................................13
CHAPTER FIVE............................................................................................................................................14
5.0 FINANCIAL PLAN..................................................................................................................................14
5.1 PRE-OPERATIONAL COST.....................................................................................................................14
5.2 WORKING CAPITAL..............................................................................................................................15

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5.3 PROFORMA ONCOME STATEMENT.....................................................................................................15
5.4 PROFORMA BALANCE SHEET...............................................................................................................16
TOTAL SALES FOR THE FIRST YEAR............................................................................................18
CONTRIBUTION MARGIN....................................................................................................................18
TOTAL SALES FOR THE SECOND YEAR.......................................................................................19
CONTRIBUTION MARGIN....................................................................................................................19
BREAK-EVEN POINT.............................................................................................................................20
TOTAL SALES FOR THE THIRD YEAR...........................................................................................20
5.7 DESIRED FINANCING............................................................................................................................21
5.8 PROPOSED CAPITALIZATION................................................................................................................22

vi
 Executive summary
BUSINESS DESCRIPTION
The name of the proposed business is PATIENCE’S GRAPHIC DESING

which will be locating in Rift valley, Nakuru location at home town Olenguruone, Nauru. I decided to
open this firm in order to satisfy customers need and need of being assisted in making business logos.
My mission and goal of opening a Graphic design business center is to enhance support to the
businesses in the area. A graphic design business offers creative solutions for visual communication
needs, including logo design, branding, website design, print materials, and more. With a focus on
creativity, innovation, and effective communication, our team of talented designers collaborates closely
with clients to bring their visions to life. Whether it's developing a brand identity or crafting compelling
marketing materials, we pride ourselves on delivering high-quality designs that resonate with our
clients' target audience and elevate their brand presence."

The business will be conducted through the following address;

GOLDEN GRAPHIC DESINGS
P.O BOX. 64-20152
NAKURU
Mobile number: 0723732314
Email:patencechepkirui8@gmail.com

MARKETING PLANS

My facility will offer goods at Fair Price as by name indication and will operate 24hours a day.
The marketing techniques are based on online marketing strategy and advertisement on magazines,
newspaper and mass media. Public, Schools and private business may get my goods from Olenguruoni
Centre and also customers will be capable of being awarded shares basing on the goods and services
bought with me

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ORGANIZATION OF MANAGEMENT
The organization structure is team based in collaboration with my willing trusted friends and family
inclusive for support and assistance. The organizational chart will be as follows;

DIRECTOR

PROJECT

DESIGN LEADS

PRODUCTION SPECIALISTS
ILLUSTRATOR

viii
OPERATION\PRODUCTION PLANS
Creating an operation or production plan for graphic design involves several key steps:

1. Understanding Client Requirements by Gather detailed information about the client's needs, including
project objectives, target audience, branding guidelines, and timeline. Research and Inspiration this is by
conducting research on the industry, competitors, and target audience to gather inspiration and insights
that will inform the design process.

The Concept Development is Brainstorm and develops initial design concepts based on the client's brief
and research findings. Design Creation: Use design software (e.g., Adobe Creative Suite) to create drafts
and refine the chosen concept into a polished design. Client Feedback and Revisions Present the design
to the client for feedback and make any necessary revisions based on their input.

The Quality Assurance is by Conduct thorough quality checks to ensure that the final design meets the
client's requirements and is error-free. Delivery: Deliver the final design files to the client according to
the agreed-upon timeline and specifications.

Documentation: Maintain documentation of the project, including client feedback, revisions, and final
deliverables, for future reference and record-keeping.

Follow-Up: Follow up with the client after delivery to ensure their satisfaction and address any
additional needs or concerns.

FINANCIAL PLAN

To run and rise together with maintaining Fair Price Firm, I employ partnership mode of

Business to help in raising some enough capital and helping in new perspectives including

Potential for tax benefits. Seeking loan to get some starting money is one of the major

Foundations of this firm and with no doubt the starting capital will be roughly 1.5million Kenyan

Shillings and launch of the facility will be progressed immediately the capital is settled.

ix
CHAPTER ONE

1.0 BUSINESS DESCRIPTION

The business Will be laid down after going through all the legal formation i.e. NAKURU County
to facilitate the business permits. PATIENCE’S GRAPHIC DESING will be able to provide the
internet browsing, computer learning and data base management.

1.1 NAME OF THE BUSINESS

The business name will be registered as Patience’s Graphic design. The name was chosen
because it is easy to pronounce, it also describes the name of the proprietor and also goes hand in
hand with business it offers as it is named

1.2 BUSINESS LOCATION

Golden graphic design will be located near RIROLA UNIFORM ENTEPRISE next to KWFT
Olenguruone.
The area of business venture is accessible. The building which the business is located will also
have other necessary activities like bookshop facilities in which a student will be able to buy
books related to computer.
The business will be conducted through the following address;
PATIENCE’S GRAPHIC DESINGS
P.O BOX. 64-20152
NAKURU
Mobile number: 0723732314
Email:patencechepkirui8@gmail.com

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1.3 BUSINESS OWNERSHIP
The proposed business will be a sole proprietorship. This kind of ownership was chosen after
considering its advantages which include enjoyment of profit alone and it’s simple to start.

1.4 FORM OF OWNERSHIP

The business will be owned by sole proprietor by the name PATIENCE CHEPKIRUI, who will
be considered in the operation of the business. This owner will be able to have privacy of the
business success since the owner will use the business skills which she obtained from Rift Valley
Institute College.

1.7 INDUSTRY
The business fall under service industry, it will enjoy the privilege of the high demand products
thus it will increase the volume of sales and service production.

1.8 JUSTIFICATION OF OPPORTUNITY

The business was chosen because there is high demand from the people who want to learn about
visual communication.ie logo design, branding print materials etc. This will hence provide a way
about of the business within the town and the owner will use entrepreneurial skills that he
obtained during the course period to achieve its goals.

1.9 BUSINESS OBJECTIVES AND GOALS

This business will have to achieve both long term and short-term goals.

LONG TERM GOALS

The business is aiming at establishment of supportive services to the industry like branding
offices and logo designing area hence these creates job opportunities to skilled personnel.

SHORT TERM GOALS

The business is aiming at putting into practice the acquired knowledge and skills to generate
income to both employees and employer through the provision of facilities.

2
ENTRY AND GROWTH STRATEGY
The sponsor intends to gain entry into the market through the county.
The business will grow because it will be among the businesses that offers the cheapest services.
And the business aids a lot in an upcoming town.

GROWTH STRATEGY
The business will be able to grow because the profit earned from its facilities e.g., it is next to a
school uniform outlet retailed shop this will aid more by getting customers direct from the
uniform shop for the uniform branding and printing school logos to the uniform .

3
 CHAPTER TWO

MARKETING PLAN

2.0 POTENTIAL CUSTOMERS

The proposed business intends to target mostly the schools, companies and business people. This
is because they will all need logos and some branding, printing off materials.
Since most of the customers are business people’ schools etc. and hence the business will be
cheaper. The customers will be focusing on the performance of the products and services.

2.1 COMPETITION
There will be high expectation of stiff competition from the other competitors as there are
those selling the same variety of the products and services. But because of its size it will be
ensured that the competition will be high as doubling the rest of the firms. This will be achieved
through capitalization from their weaknesses as shown below.

The business intends to attract three quarter of people in Olenguruone town, the town has a total
population of Approximately 20,000 people but since there are a number of same businesses
which have more customers when shared among its competitors will be as follows.
Number of businesses. Number of customers.
PATIENCE’S GRAPHIC DESIGNS. 10,000.
GREEN LEAVE DESIGNS. 6,000.
DORIC’S DESINGS 4,000.

4
 population

4000

10000
PATIENCE GRAPHIC DESIGN
GREEN LEAVES DESIGNS
6000 DORICS DESINGS

2.3 SALES TACTICS

The selling methods to be employed is that I will be a director so that the customers will be able
to ask concerning the products or services, also will be in charge of money. the other methods
will be indirect in which the customers will require for services or products in exchange for
another services or products in a greed situation. There will be a possibility of utilizing the
distributors and agencies because the services will attract many customers hence the distributors
and agencies will be able to supply more products to meet customer needs.
The business will have to cover the whole area of Kuresoi south and its estates because of the
expansion of the business.

2.4 ADVERTISEMENT
The business will advertise its services and products using posters on various place in town,
word of mouth to persuade customers to visit the cyber cafe media like radio, television. The
mention advertisement will be effective to the business

5
PROMOTION
The business intends to promote its frequent customers by offering a free internet browsing and
computer learning on Saturdays and also the customers will be given. T shirts and bags with the
name of the business written on it.

2.5 PRICING STRATEGY

The price for the services will be determined by the market force by increasing and lowering the
prices will cause a social impact on customers, by lowering the prices the business will be able to
meet its objectives as required.
The potential arid frequently customers will get discount according to their needs e.g., browsing
which will be lowered by 8% of the normal and the computer learning will be lowered by 5%.

2.6 DISTRIBUTION STRATEGY

Distribution of products will mainly be done through the direct method where this will be
cheaper ways of getting products to the people living near to the business.
The business will mostly use the road as a means of transport, costs will be expected to be high
per month when the business will have expanded because there will be a high need of
transporting more products. The problems that may be anticipated in distribution may include
climatic changes e.g., rainy seasons and high transportation cost which arises through business
buying the most expensive vehicle and hiring of qualified drivers in which it will reduce the
anticipated problems.

CHAPTER THREE
6
3.0 ORGANIZATIONAL MANAGEMENT PLAN
Organizational structure
The business will use the method of vertical chart structure in which the chain of
Command will also flow through the designed chart.
The following is the structure of the organization at the beginning of the business.

Manager

Secretary

Cashier

Watchmen

General Manager

Assistant manager

Accountant

3.1 MANAGEMENT TEAM

The business will include the main personnel who will ensure that the business runs towards
achieving its goals.
The manager will be Patience who is also the owner of business who pursued
certificate in information technology, she will ensure that she assigns duties on the workers as
well as planning and making the final decisions and also, she will be responsible for payment of
salaries and wages to the workers.
The assistant manager will be keeping in computer records and digital electronics repair and
assist in assigning duties to workers concerning the new technology.

7
3.2 OTHER PERSONNEL
The business will comprise of three other personnel who will be employed according to their
qualifications.
The business should have a supervisor who should have Diploma in business management whose
duties will only comprise of supervision and also act as a supplier of information to the firm.
The other personnel will be a customer operator who should have a Diploma in information
communication technology and his /her duties will advertise the computer operators, responsible
for general equipment layout within the computer room e.g., the computer room is tidy. The
other person will be a cashier should have a Diploma in accounting and should have an
experience of two years in related field. His /her duties will be to make a financial record and
plan for the firm and also make records of the money gained as per day.

3.3 RECRUITMENT, TRAINING AND PROMOTION OF PERSONNEL.

The proposed business will tend to use porters in advertisement for the application and
recruitment of the qualified personnel; these qualified personnel will be promoted.

RECRUITMENT
The general manager and the assistant manager will administer all recruitment process which
includes advertising, short listing and replacement of employees according to the required
qualification, recruitment will be continuous process depending on the expansion of business
labour turn over and dismissal.

TRAINING
The employees will be trained and allowed to attend seminars according to the area of work they
partake. This will make them to do their jobs effectively.

PROMOTION
The proposed business will promote employees on merits and activities of trained employees and
also according to seniority to achieve the discipline and targeted goals of the business.

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3.4 RENUMERATION AND INCENTIVE FOR PERSONNEL
The business will ensure employees will be highly valued by provision of fair wages and salaries
according to their positions.

RENUMERATION
The business will ensure that the administration will be fair in payment and increased according
to the expansion of the business.

3.5 INCENTIVES
The business will provide transport to the workers, loan and lunch provision which are not
deducted from their salary, there will also be leaves under each department.

3.6 LEGAL REQUIREMENT

The business will be licensed by County government of Nakuru which will be paid after every
six months and the permits be issued for the business often obtains the required legal formalities.
The cost of the license will be Kshs 6,000 which is five hundred shillings per month. The local
taxes will be paid according to the services and products on their prices; the other requirement is
that there will be no more than unlicensed business to be conducted.
Other supportive services
The business is to acquire its banking services at Absa bank at Nakuru branch.
ABSA BANK

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 CHAPTER FOUR

4.0 PRODUCTION AND CO-OPERATION PLAN INTRODUCTION

The business will lay down its strategies concerned customers, the production and services will
be unique and of high quality.
The proprietor will be both creative and innovative when production or giving services.

4.1 FACILITIES
Facilities that will be required by the business to achieve its objectives will be electricity which
is necessary for the computers and provision of light, the store room will be needed for storing
the products e.g., the typing material and other facilities.

EQUIPMENT
The business purchases the required equipment for the efficient running of the business.

4.2 MAINTAINANCE AND REPAIR

The manager of the business will make sure that the business is running smoothly through the
repairing of the equipment’s which will be done after 4 months e.g. the chairs and tables will be
repaired by a carpenter from Premium carpentry shop which will cost Kshs 500. The computer
and other machines will be required with its spares being bought from Safaricom towers will cost
Kshs 5,000 after every route months.

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4.3 PREMISE LAYOUT
The premise will consist of the reception, counter for cashier, working room, washroom, store
room and manager office and the security.

4.4 PRODUCTION AND OPERATIONAL STRATEGY

The proposed business will minimize its prices on services and produce offering to its customers
to adapt to the other competitors in the market.

PRODUCTION DEVELOPMENT
The intended business will sell high quality products and services at favorable prices to increase
diversity and widen the revenue base. With time the business will expand to gain stability and
become more complex in its operations with the rising technology which will speed up the
operations thus it increasing the quality of goods and services.

4.5 MONTHLY MATERIAL REQUIREMENT

The proposed business will be able to purchase the monthly material which will enable the
smooth running of business. The table below shows the material needed.

4.6 MONTHLY LABOUR REQUIREMENTS

The proposed business will have both direct and indirect labour for the flow of the
Business

11
12
4.7 MONTHLY PRODUCTION/OPERATION COST
The business will have to some up all the material requirements, monthly labour cost and the
monthly overheads which will show out all the expenses incurred in the business. The overhead
will include the electricity bill, rent, advertisements, water bills and telephone. Items. Total
Cost in Kshs
Electricity. 4,000
Rent. 4,500
Advertisements. 1000
Water bill. 500
Telephone. 1,000
Total. 11,000

Particulars. Amount
Monthly material. 20,000
Monthly labour cost. 50,000
Monthly overhead cost. 10,000
Total. Ksh 80,000

4.8 PRODUCTION PROCESS

The business will start by buying the material and the spare parts of computers which will be
stored in the store room. After the customer has been served then he/she will be issued with a
receipt which will show the amount paid for a particular item. For the business to ensure that it
will produce the services and products of high quality then the manager will ensure that the
qualified personnel is hired with time management.

4.9 RELEVANT REGULATION

The regulation affecting production operation include the health regulation which is under
computer operation e.g. shock from the electronics in which operations will be given rules in
which will avoid them from shock and radiations.
The second regulation is the labour laws; the act provides that an employee should be confirmed
permanent.

13
In case of any overtime work, employee will then be paid for it.
The third regulation is the environment in which the business is running on e.g. the operations
room should be clean for the personnel and workers safety from disease. If the business
environment is not conducive then the business will be closed down,

14
 CHAPTER FIVE

5.0 FINANCIAL PLAN

5.1 PRE-OPERATIONAL COST

DETAILS AMOUNT

Registration 8,000

Advertising 1,000

Telephone 1,000

Rent 4,500

Electricity 5,000

Water 500

Banking 500

Insurance 3,000

Postal services 1,000

TOTAL 24500

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5.2 WORKING CAPITAL

ITEM FIRST YEAR SECOND YEAR THIRD YEAR

Bank loan 50,000 50,000 50,000

Personal saving 300,000 400,000 60,000

Family contribution 200,000 130,000 100,000

Stock of raw materials 5650 1,500 8000

Creditors 10,000 12,000 11000

TOTAL 565,650 609,500 169,000

5.3 PROFORMA ONCOME STATEMENT

ITEM AMOUNT(KSH) AMOUNT(KSH) AMOUNT(KSH)

YEAR ONE YEAR TWO YEAR THREE

Sales 46,814,850 61,362,300 32,820,000

Cost of goods sold 1,480,000 9,600,000 8,910,000

Gross profit 45334850 51762300 23910000

EXPENSE

Rent 81,500 88,000 95,000

Wages/Salaries 1,388,000 12,900,000 12,900,000

Electricity 5,250 4,250 4,250

16
Advertising 84,000 43,000 42,000

Water 2,350 1,300 1,300

License 2,000 2,000 2,000

Insurance 1,000 2,000 5,000

Postage 9,400 4,300 4,300

Telephone 48,500 9,500 9,500

Banking 3,550 1,950 1,950

Loan repayment 80,000 50,000 50,000

Miscellaneous 32,000 25,000 16,500

TOTAL EXPENSE 1,149,550 13131300 13,131,800

PROFIT BEFORE 44185300 38631000 10778200

TAX

TAX PROVISION 20*31,585,300= 20*44,631,000= 20*10,118200=

100 100 100

8837060 8,926,200 2155640

NET PROFIT AFTER 30,068,240 35,104,800 8,622,560

TAX

5.4 PROFORMA BALANCE SHEET

ITEM AMOUNT(KSH) AMOUNT(KSH) AMOUNT(KSH)

YEAR ONE YEAR TWO YEAR THREE

ASSETS

CURRENT ASSETS

Cash at hand 300,000 400,000 600,000

Cash at bank 50,000 50,000 8,000

17
Debtors 10,000 12,000 11,000

Raw materials 5,650 1,500 8,000

TOTAL CURRENT 365650 463500 627000

ASSETS

FIXED ASSETS

Machinery Equipment 186,000 186,000 186,000

Furniture 16,100 16,100 16,100

Land 250,000 250,000 250,000

TOTAL FIXED 452,100 452,100 452,100

ASSETS

TOTAL ASSETS 818,350 922,200 1,019,100

LIABILITIES

CURRENT
LIABILITIES

Creditors 10,000 12,000 11,000

Bank overdraft 20,000 18,000 15000

TOTAL CURRENT 30,000 30,000 26,000

LIABILITIES

LONG TERM
LIABILITIES

Bank loan 50,000 50,000 50,000

Capital employee 300,000 400,000 600,000

TOTAL LONG 350,000 450,000 650,000

TERM
LIABILITIES

TOTAL 380,000 480,000 616,000

LIABILITIES

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5.5 BREAK-EVEN POINT

TOTAL SALES FOR THE FIRST YEAR

=46,814,850

VARIABLE COST AMOUNT(KSH)

Telephone 48,500

Electricity 5,250

Advertising 84,000

Postage 9,400

Water 2,350

Loan repayment 80,000

Miscellaneous 32,000

TOTAL 261500

CONTRIBUTION MARGIN

=1,218,500

FIXED COST AMOUNT(KSH)

Rent 81,500

Wages/Salaries 1,388,000

Insurance 1,000

Banking 3,550

Registration 8,000

TOTAL 1482050

19
BREAK- EVEN POINT

=4,981,666.661

TOTAL SALES FOR THE SECOND YEAR

=61,362,600

VARIABLE COST AMOUNT(KSH)

Telephone 9,500

Electricity 4,250

Advertising 43,000

Postage 4,300

Water 1,300

Loan repayment 50,000

Miscellaneous 25,000

TOTAL 112350

CONTRIBUTION MARGIN

=9,481,650

FIXED COST AMOUNT(KSH)

Rent 88,000

Wages/Salaries 12,900,000

Insurance 2,000

Banking 1,950

Registration 8,000

TOTAL 12999950

20
BREAK-EVEN POINT

=1,299,995,000

TOTAL SALES FOR THE THIRD YEAR

=32,820,000

VARIABLE COST AMOUNT(KSH)

Telephone 9,500

Electricity 4,250

Advertising 42,000

Postage 43,000

Water 1,300

Loan repayment 50,000

Miscellaneous 16,500

TOTAL 166550

CONTRIBUTION MARGIN

=8,143,450

FIXED COST AMOUNT(KSH)

Rent 95,000

Wages/Salaries 12,900,000

Insurance 5,000

Banking 1,950

Registration 8,000

TOTAL 13009950

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BREAK-EVEN POINT

=13,215,459.18

5.6 PROFITABILITY RATIOS

RATIO YEAR ONE YEAR TWO YEAR THREE

Gross profit ratio 39,334,850*100 51,162,300*100 23,910,000*100

1,480,000 9,600,000 8,910,000

=525.861 =601.690 =268.350

Return on Equity 30,068,240*100 35,104,800*100 8,622,560*100

300,000 400,000 600,000

=10,022.141 =8,962.2 =1,431.093

Return on investment 30,068,240*100 35,104,800*100 8,622,560*100

565,650 565,650 565,650

=5,315.691 =6,312.111 =1,524.363

5.7 DESIRED FINANCING

ITEM AMOUNT(KSH)

Pre-operational cost 32,000

Working capital 565,650

Fixed assets 4,981,666.661

TOTAL 5579316.661

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5.8 PROPOSED CAPITALIZATION
ITEM AMOUNT(KSH)

Owners’ contribution 300,000

Bank loan 50,000

Friends and Family contribution 200,000

TOTAL 550000

23