BUSINESS PLAN

GREENSCOPE SURVEY AND CONSULTANCY FIRM

PRESENTED BY: EZRA KIPKURUI MARITIM

INDEX NUMBER: 5231020048
COURSE CODE: 2312
CENTER NO: 523102
PAPER NUMBER: 2312/307B
COURSE: DIPLOMA IN LAND SURVEY
PRESENTED TO: KENYA NATIONAL EXAMINATION
COUNCIL IN PARTIAL FULFILLMENT FOR THE AWARD
OF DIPLOMA IN LAND SURVEY

EXAM SERIES: NOVEMBER SERIES

SUPERVISOR: MR. KEMBOI

 DECLARATION
I declare that this business plan is my original work based on my personal research and has not
been presented anywhere else for examination purpose.

STUDENT’S NAME: EZRA KIPKURUI MARITIM -CANDIDATE

SIGNATURE _________________________________________________________________

DATE _________________________________________________________________

SUPERVISOR’S NAME: MR.KEMBOI KENNEDY

SIGNATURE _________________________________________________________________

DATE _________________________________________________________________

ii
 ACKNOWLEDGEMENT
I thank the Almighty God for the knowledge and strength all through my proposed business plan.

I also give special thanks to my parent’s brothers and sisters who provided me all the support I
need e.g. Advice, encouragement and also indebted to thank the Almighty God for the strength
and wisdom in producing this work.

A lot of thanks also go to my supervisor who tirelessly guided and encouraged me to ensure that
I did my best.

May God bless you all.

iii
 DEDICATION
I dedicate this to my able supervisor Mr. Kennedy Kemboi, My parents for enduring love and
support from my friends for having given me a good company and installed the culture of
hardworking life

Also to my brothers and sisters for believing in me and enhancing the realization of my potential
to perform.

iv
 Table of Contents
DECLARATION ............................................................................................................................................. ii
ACKNOWLEDGEMENT ................................................................................................................................ iii
DEDICATION ................................................................................................................................................iv
Table of Contents........................................................................................................................................ v
CHAPTER ONE ............................................................................................................................................. 1
EXECUTIVE SUMMARY ................................................................................................................................ 1
CHAPTER TWO ............................................................................................................................................ 3
MARKET PLAN ............................................................................................................................................. 3
2.1 Market Analysis................................................................................................................................. 3
2.2 Customers ......................................................................................................................................... 3
2.3 Sales Potential................................................................................................................................... 3
2.4 Promotional Methods ....................................................................................................................... 3
2.5 Market Segmentation and Market Share .......................................................................................... 4
2.6 Market Research ............................................................................................................................... 4
2.7 Demand Analysis ............................................................................................................................... 4
2.9 Pricing Policy ..................................................................................................................................... 5
CHAPTER THREE .......................................................................................................................................... 6
ORGANIZATION AND MANAGEMENT PLAN ................................................................................................ 6
3.1 Organization Structure ................................................................................................................ 6
3.2 Managing Personnel ......................................................................................................................... 7
3.3 Other Management Personnel.................................................................................................... 8
3.4 Requirements Training and Promotion ....................................................................................... 8
3.4.1 Training ................................................................................................................................... 9
3.4.2 Promotion. .............................................................................................................................. 9
3.5 Remuneration and Incentives ..................................................................................................... 9
3.5.1 Incentives .............................................................................................................................. 10
3.6 License, Permits and Bylaws ..................................................................................................... 10
3.6.1 By-Laws ........................................................................................................................................ 10
3.7 Support Services ............................................................................................................................. 10
3.7.1 Bank Services ............................................................................................................................... 10
3.7.2 Postal Services ............................................................................................................................. 11

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 3.7.3 Insurance Services........................................................................................................................ 11
CHAPTER FOUR ......................................................................................................................................... 12
OPERATION AND PRODUCTION PLAN....................................................................................................... 12
4.1 Production Facilities and Capacity .................................................................................................. 12
4.2 Production Strategy ........................................................................................................................ 12
4.2.1 Preliminary Cost ........................................................................................................................... 13
4.3 Monthly Overheads ........................................................................................................................ 13
4.4 Production Operation ..................................................................................................................... 14
4.5 Production Process ......................................................................................................................... 14
4.6.1 Solution ........................................................................................................................................ 15
4.6.2 Competition ................................................................................................................................. 15
4.6.3 Solution ........................................................................................................................................ 15
4.6.4 Transport ..................................................................................................................................... 15
4.6.5 Solutions ...................................................................................................................................... 15
4.7 Regulation Affecting the Business ................................................................................................... 15
4.8 Government Policies ....................................................................................................................... 16
4.9 Registration and Trade Market Act ................................................................................................. 16
CHAPTER FIVE ........................................................................................................................................... 17
FINANCIAL PLAN ....................................................................................................................................... 17
5.1 Pre-Operational Cost....................................................................................................................... 17
5.2 Working Capital............................................................................................................................... 18
5.3 Cash Flow Statements ............................................................................................................... 19
5.3.1 Cash Flow Projection for the First Year ........................................................................................ 19
5.3.2 Cash Flow Projection for the Second Year ................................................................................... 21
5.3.3 Cash Flow Projection for Year Third Year ..................................................................................... 22
5.4 Proforma Income Statement .......................................................................................................... 25
5.5 Proforma Balance Sheet.................................................................................................................. 26
5.6 Desired Financing ............................................................................................................................ 27
REFERENCES.............................................................................................................................................. 28
APPENDIX: MILESTONE SCHEDULE ........................................................................................................... 29

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 CHAPTER ONE

EXECUTIVE SUMMARY
1.1 Business Description

The business will be named GREENSCOPE Survey and Consultancy Firm and will be a
company form of business with the owner being Ezra maritim who is currently undertaking a
diploma course in Land survey at Aldai TTI. It will be located at Tealand opposite Uhuru garden
along salat Road ,500m away from the highway and its major activities will be to provide
services both individual residents of the area and other firms, which require the same services
such as land sub division, process of title and Engineering works in the area and nationaly.

1.2 Marketing Plan

The owner also looks forward to advertising the business heavily through radio, TV, and posters.
The owners also will co-ordinate the business to operate fairly at a high profit margin. The
business will have fewer customers at its beginning due to competition from well-established
firms and unaware customers of the business existence. For this reason, the owner will try to win
more customers through heavy advertisement and quality services it will offer.

1.3 Organization and Management Plan

The overall manager of the business will be the proprietor being assisted by sub-ordinate staff.
He will be leading all the employees using all the skills and experience to the best capacity
possible will take the current high demand in the area. The business will only begin its operation
after attaining all the requirements including licenses and permits.

1.4 Operational and Production Plan

The business will officially commence its services early on march 2025. The business will serve
both the resident of the area and other firms within the country. Other than competition from
other related firms, the business competitive advantage is that it will be located close to most of
its customers.

Greenscope Surveyor and Consultancy Firm is scheduled to commence officially on January

2024 when it will have attained all materials, equipment, licenses, and permits

1
1.5 Financial Plan

The business requires Ksh.2,800,000.00 to start it operation. This amount will be raised as
follows

Personal savings -Ksh.1,200,000

Family /friends contribution -Ksh.800 000

Bank Loan -Ksh. 800,000

This amount will be used to purchase the equipment’s to be used to execute quality services to
the customers and to help maintain the business running at its beginning periods.

2
 CHAPTER TWO

MARKET PLAN
2.1 Market Analysis
The business will conduct a survey to the area so as to gather information about the customers.
The survey will help to know what the business likes and dislike and also to know the kind of
products and services to introduce at what time of the year. The analysis will also help the
business in determining the price of services and products compacting with competition. The
business will use penetration pricing so as to overcome competition.

The business will also use post base pricing method so as to make maximum profit the market
analysis will also help the business to know the customers in time and their ability to purchase
and using the service.

2.2 Customers
The business will benefit from different customers in the area. The major targeted customers are
customers from nearby localities and towns such as the Nandi, Kapsabet and Others. The
business also targeted individuals who go far looking for similar products and services and
therefore business capturing them, commercial customers are also targeted.

2.3 Sales Potential

The business will have a high expectation of making sales simply because there will be no high
competition and also the suited area is close to customers. The business will increase the sales by
giving out discounts to the esteemed customers warrant guarantees of two weeks in every
product purchased and also by advertising the business through posters so as to bring awareness
and alert people about the new business.

2.4 Promotional Methods

The business will employ different strategies to bring awareness about products and services
offered in the business. This objective will be derived by advertising which will be done through
posters and giving discounts to the customers as well. Bulletins will also be used, advertisements
will create awareness about the new business hence having high market share.

3
2.5 Market Segmentation and Market Share
After the business has carried out market analysis it will now divide the market so as to meet
needs of customers. The business will go by the taste and fashion of the key customer’s .It will
be divided according to the customer’s purchasing power of the products and services and their
modes of income such as those who earn daily, monthly and even weekly will be much put into
consideration. The products will be both international, commercial and individual and therefore
their time of opening and closing or working hours will be highly considered so as to catch up
with each one. The business will get its shares from transnational bank in form of loan
amounting to 40%, individuals will give share of 30%, owner will contribute 20% and the family
will give a share of 10%.The following pie chart represents the total market share.

2.6 Market Research

This business will carry operations in the market to identify customers need. This will help to
bring in services and products which have meaning and needed by customers.

It will avoid purchasing products which will be stagnant to market. This operation will also help
to know much about competitors, how they sell and price their products and charge their services
so that the business can know how to do about competing with them. It will also help to know
about the quality of the products and from which comprises location of the business i.e. does
enable to look for good location of the business. These involves the roads, should be accessible
to your customers, the security should be good.

Procedure to be followed

➢ Identify the problem and try to solve.

➢ Identify area to carry out market research.
➢ Go to the field and collect data.
➢ Compile and write report.
➢ Give conditions and recommendations

2.7 Demand Analysis

This will be achieved by making observation on customer preferences.

The business will offer high quality services to its customers so as to keep a positive rapport with
its client base.
4
2.9 Pricing Policy
The pricing of the products and services will be affordable to all customers through following
market research and analysis carried out the business will use post base pricing method where it
will identify the products then decide on the price so as to get the profits.

Price = cost of products + profit. The business will afford to use penetration pricing.

Reduce the price of the products to management price depending on the market demand.

This will make sure that all potential and targeted customers can afford the business charges in
service and products as well.

5
 CHAPTER THREE

ORGANIZATION AND MANAGEMENT PLAN

For the business to run effectively, it will need clear and open organizational and good
management plan. This will enable employees to know;

➢ Who is their supervisor

➢ The order and chain of command
➢ How to communicate and pass information clearly.
➢ How to work efficiently
➢ Who to see in case of any problem.

3.1 Organization Structure

Manager

.
Assistant Manager Accountant

Watchman Clerks Technician Cleaners Messengers

6
3.2 Managing Personnel
The business will run the manager and assistant manager as the key personnel. The business will
also have clerks who will be employed. The following shows the personnel their duties and
qualification.

Personnel Responsibilities Qualifications

Manager ➢ Coordinates the business ➢ Have diploma in Survey

➢ Peace making ➢ Two year working
➢ Organizing business experience
➢ Planning for duties
Assistant manager ➢ Assist in planning ➢ Have a diploma in Survey
➢ Assist in controlling.

Accounts clerk ➢ In charge of cash ➢ Have diploma in

payments. accounts
➢ Cash transactions - ➢ One year experience

7
3.3 Other Management Personnel
The business will have other personnel who will help it run efficiently such personnel will have
their role to play so as to meet objectives of the business.

PERSONNEL RESPONSIBILITY QUALIFICATION

Cleaners • In charge of general • Have KCSE certificate or

cleanliness of the any irrelevant certificate.
business i.e. dust, mud • Work with minimal
etc. supervision
Supervisors/attendants • In charge of • Computer literate
supervising and • React to work with no close
attending to customers supervision.
such as helping and • Should be a linguist.
assisting them when • Good job relation.
machines not • Any foreign language to
responding. added advantage.
Surveyors • In charge of repairing • Should be skilled and
and maintaining and knowledgeable in survey
installing computers work
and other electrical • Should be a holder of
accessories diploma in survey

3.4 Requirements Training and Promotion

The business will employ a very professional way of recruiting its staff the business will
advertise the vacancies and those who are to apply through the address which will be provided.

The qualified applicants will be called for an interview. The business will give details about the
requirements.

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3.4.1 Training
The business will orient qualified which will be considered as part of training and circulation
will take two days. The business will also conduct a workshop so that the staff can get to be
familiarized with the promises to get to know well. All this will take place in the first two days.

3.4.2 Promotion.
The business will promote the staff after analyzing their performance. The promotion will take
place after every year and this will be carried out by manager. This promotion will lead to
motivation of workers hence working with extra effort.

3.5 Remuneration and Incentives

The business will have different packages of payment and this will be based following their
duties and responsibilities. The following table shows the remuneration of the staff.

EMPLOYEE POST SALARY PER SALARY TOTAL

MONTH PER YEAR SALARY

Manager 1 15000 15000 x 12 180,000

Assistant 1 14000 14000 x 12 168,000

manager

Accountant 2 12000 12000 x 12 x 2 288,000

Janitors 1 8000 8000 x 12 96,000

Cleaners 2 5000 5000 x 12x2 120,000

Supervisors 3 9000 9000 x 12 x 3 324,000

Surveyors 1 9000 9000 x 12 108,000

TOTALS 72,000 1284000

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3.5.1 Incentives
The business will employ different ways to boost and are made to employees the following are
some incentives.

The business will provide fringe benefits which will give to each staff.

The business will provide tea break daily to the employees and this will prevent loss of time.

Medical service will also be given and allowance of only the staff produces a letter from
recognized hospital.

There will be a reward of certificate of merit to those employees who will have no observation in
roll call register. This will motivate the staff and stop being observed without permission.

3.6 License, Permits and Bylaws

The business will have to get legal requirement regulation and policies. The business will get
licenses, issued by the county council of Kisumu at one thousand shillings and is paid yearly.
This permit for it to operate in the business should obtain a permit for it to operate in the town.

This is legal document and government requirements.

3.6.1 By-Laws
The business will employ and put in place some of the bylaws which will be strictly followed.
These bylaws are:-

• No smoking in the business the business will be no smoking zone since it is unhealthy to
customers and also staff.
• No putting marks on the tables, walls and machines, no name will be allowed with an
exception of owner’s names of identification done by authorized personnel.

3.7 Support Services

The business will need assistant from other organizations and will work in conjunction with them
so as to benefit from this service and be able to meet specified goals .Such services are:

3.7.1 Bank Services

The business will majority need banking services which will help in making transactions such as
deposit and withdrawal of cash. They will also assist in giving security to the cash we deposit to
10
avoid cash theft. They will as well help in securing loans when the business needs some
expansion capital. These services will be gotten from Kenya commercial bank Kisumu Boys and
addition to that they are our esteemed customers.

3.7.2 Postal Services

The business wills as well need some postal assistant especially to get the postal address and
telephone landline and those services will help in communication through mails and telephone
calls. These services will be provided by the Kenya postal service Kisumu Boys which is
opposite to the business.

3.7.3 Insurance Services

The service will help in giving security to the business which will be issued in case of fire and
theft. These services will ensure the business gets compensation after any of the two occurred
.These services will be gotten from (C.P.B) insurances. It will be selected because their charge is
negotiable and bearable.

11
 CHAPTER FOUR

OPERATION AND PRODUCTION PLAN

In this section the business will have different production aspects as how business will get
products and services and how will it operate the business.

4.1 Production Facilities and Capacity

The business will need production facilities and will as well require some right machines so as to
operate efficiently .The table below show facilities required in the business.

ITEM QUANTITY SUPPLIER UNIT COST TOTAL COST

Dumpy Level 1 Amazon company 350,000 350,000

Furniture & 1 Mwangaza furniture 1x15000 15,000

fitting

Optical Square 1 pcs Mutai bookshop 50,000 50,000

Dust coat 8 pcs Mutai bookshop 8x200 1600

Theodolite 1 Amazon company 250,000 250,000

Tape Measure 1 Mutai bookshop 1x1000 1000

Total 667,600

4.2 Production Strategy

The business will have different production ways which will be laid down by the managers.
There will be many producers’ ways which will be adopted to meet the goals. These will be raw
materials such as computers, stationeries which will be sold to customers. Registration fee will
be set, insurance and other preliminary expense will be considered.

12
4.2.1 Preliminary Cost

ITEM COST
Rent 5000
Electricity 1500
Labour 72000
Registration 2000
Advertisement 3000
Receipt book 200
Miscellaneous 10,000
Total 93,700

4.3 Monthly Overheads

The business will need different things which should be done within the first month so that it can
operate and they are legal and major requirements. The table below shows the monthly
requirement.

ITEM AMOUNT

Electricity bill 1500

Telephone bill 1000

Water bill 500

Insurance bill 5000

Advertisement bill 5000

Transport bill 1000

Repair bill /maintenance 5000

13
 License bill 1500

Rent 5000

Labour 72000

Stock 20000

TOTAL 117,500

4.4 Production Operation

ITEM AMOUNT

Raw materials 50000

Labour 72000

Overhead expenses 117500

TOTAL 239500

4.5 Production Process

The customers will serve him/herself so as to have privacy in the business but there will be
personnel assistant in case customer does not get stock he will be assisted. After the customer
has finished, the payment will be made at the counter and obtain relevant receipt of the service
obtained. This will help in accounts transaction and to analyse market performance of the
business.

4.6 Factors Affecting the Production Process and the Possible Solutions.

The business will get different difficulties which might affect it negatively, such contributions
are: theft in the town and then will make it not easy to operate up to late hence hindering
approximate working hours.

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4.6.1 Solution
The business therefore will employ janitors who will keep guard overnight and also this is an
inter-relationship between the business and security patrols. In case of any detect, the janitors
will raise the alarm.

4.6.2 Competition
The business will find it hard to penetrate into the market especially at this start up time.
Competitors are many and very stiff and this might affect the business especially the first month.
It will be required to set some money for advertisement.

4.6.3 Solution
The business will keep some money so as to employ some advertisement techniques so as to
make people aware of the business. It will also be required to have unique products and services
which will motivate customers .Special offers will be made to attract many customers in the
market modern technologies and service.

4.6.4 Transport
The business won’t find it possible to get products from manufacturers to the business and this
will affect it since it will be expensive especially when required to hire its own vehicle to
transport the products.

4.6.5 Solutions
The business will organize and make good relationship with the manufacturer so that they can
bring the products to the business at no cost. This will be done by maintaining one supplier all
the time.

4.7 Regulation Affecting the Business

Employment act cap 229 of Kenyan constitution.

The act outlines conditions and regulations governing the relationship between the employer and
employees. All these regulations have to be followed and include National Social Security Fund
which each and every employer must be registered. National Hospital Insurance Fund must also
be paid. This affects s the overall business performance.

15
4.8 Government Policies
These are regulations which are brought in by the ministry of trade and threats to the business
such as important taxation, which are very high and unbearable or unaffordable. This high
taxation will affect business negatively .Price controls unit also whereby tend to give much
instruction which may lead the business from not making maximum profit of the products are
expected.

4.9 Registration and Trade Market Act

The business will find it hard to go about getting some registration from the council which is a
much and expensive .The business has to get own trademark (logo) and for it to be put through it
has to pay some money.

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 CHAPTER FIVE

FINANCIAL PLAN
5.1 Pre-Operational Cost

DETAIL AMOUNT

Rent 500

Electricity 1500

Salaries 72000

Registration 2000

Advertisement 3000

Receipt books 200

Telephone 1000

Water 500

Insurance 500

TOTAL 90200

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5.2 Working Capital
ITEM 1ST YEAR 2ND YEAR 3RD YEAR

CASH 100000 15000 200000

LOAN 200000 250000 300000

CREDITORS 50000 60000 75000

STOCK 50000 65000 85000

WORKING 400000 525000 655000

CAPITAL

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 5.3 Cash Flow Statements
5.3.1 Cash Flow Projection for the First Year
PARTICULAR JAN FEB MAR APP MAY JUNE JULY AUG SEP OCT NOV DEC TOTA
S L
Cash flow
Balance b/f 21240 18200 17700 18350 18400 18370 18410 18700 19000 19500 194300 500000
0 0 0 0 0 0 0 0 0 0
Bank loan 50000 500000
Cash invested 60000 600000
0
Sales 28000 28500 29340 29110 28807 29642 29949 30251 30683 30737 307375 327285
0 0 0 0 5 5 5 5 5 5 5
Debtors 10122 11617 13002 13100 13190 13290 13320 13410 13500 13530 136200 141702
5 5 5 0 0 0 0 0 0 0 5
Total cash flow 96760 59362 58317 60242 60560 60302 61303 61679 62361 63183 63697 635835 773248
0 5 5 5 0 5 5 5 5 5 5 0
Cash out flow
Purchase 10000 11000 10500 12000 12100 12000 11900 12900 13200 13500 14000 145000 147600
0 0 0 0 0 0 0 0 0 0 0
Insurance 12000 12000 12000 12000 12000 12000 12000 12000 12000 12000 12000 120000 144000
Machinery 42220 422200
&equipment 0 0

19
Salary &wages 21090 21090 21090 21090 21090 21090 21090 21090 21090 21090 21090 210900 253080
0 0 0 0 0 0 0 0 0 0 0 0
Electricity 10000 5700 5500 5550 6100 6200 5900 5950 5700 5700 5700 6000 74000
Tele postage 1000 6080 6200 6250 6225 6300 6350 6450 6000 6200 6300 6310 56920
Water 8000 4000 4100 4200 4350 4500 4400 4220 4600 4900 4450 5000 214150
Transport 7500 5000 3000 2000 2400 2100 2200 2200 3000 17800 38150
Stationary 171875
Loan 15625 15625 15625 15625 15625 15625 15625 15625 15625 15625 15625 15625
replacement
Advertisement 30000
Rent 6500 6500 6500 6500 6500 6500 6500 6500 6500 6500 6500 6500 78000
License/permit 6500 6500
Furniture/fitting 40000 40000
s
Creditors 10000 15000 15500 15900 15800 15750 1600 16100 16500 16500 1700 17500 185500
Miscellaneous 3000 2900 2950 3000 3200 3100 2800 2700 27900 2750 3000 3000 348900
Total cash 88760 41162 40417 41892 42160 42027 42892 42979 42892 44197 44863 558468
output 0 5 5 5 0 5 5 5 5 5 5 0
Ending cash 21240 18200 17960 18350 18400 18370 18410 18700 19000 19430 19500 205200 214780
flow 0 0 0 0 0 0 0 0 0 0

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 5.3.2 Cash Flow Projection for the Second Year

PARTICULARS JAN FEB MAR APP MAY JUNE JULY AUG SEP OCT NOV DEC TOTAL
Cash flow
Balance b/f 205200 206500 208100 211000 212500 212500 214200 21900 21900 221300 222500 223400 2569900
Bank loan
Cash invested 500000 500000
Sales 330100 331300 332700 334000 335200 335200 337100 340200 340500 34800 342100 3444300 4041600
Debtors 149750 139125 140875 141255 142475 1424775 143475 147325 144125 144275 143850 145725 1722855
Total cash flow 485 677525 687675 686255 690175 690175 694775 703825 703625 705575 708450 713425 8834385
Cash out flow
Purchase 140000 155000 157000 160200 1622500 162500 162800 160000 165100 166400 167300 170700 1925300
Insurance 20000 20000 20000 20000 20000 20000 20000 20000 20000 20000 20000 20000 240000
vehicles
Salary &wages 210900 210900 210900 210900 210900 210900 210900 210800 210900 210900 210900 210900 210900
Electricity 6000 6200 5900 6300 6350 6350 6250 6100 6000 6100 5900 6100 73900
Tele postage 6300 6450 6300 6500 6400 6400 6250 6100 6000 6100 6175 6250 75125
Water 5000 5100 5150 5300 5450 5450 5500 5000 5650 5000 5350 5400 63450
Transport 21000 21200 2200 19500 29000 20000 20500 21000 22300 2000 23500 2400 257900
Stationary 3000 3100 2900 3250 3200 3200 3300 3050 3300 3050 3000 3150 37650

21
 Loan 15625 15625 15625 15625 15625 15625 15625 15625 15625 15625 15625 15625 187500
replacement
Advertisement
Rent 6500 6500 6500 6500 6500 6500 6500 6500 6500 6500 6500 6500 78000
License/permit 1000 1000
Furniture/fittings
Creditors 16000 16200 16300 16800 16800 17500 17500 17450 17500 17600 17500 17700 203750
Miscellaneous 3200 3150 2850 2910 17000 1700 17450 17450 17500 17600 17500 17700 203750
Total cash 478525 469425 4721025 473785 475975 475915 484475 484825 184325 484075 485050 46325 624585
output
Ending cash 206500 208100 21100 212500 214200 214200 219000 21900 221300 222500 223400 124100 2458800
flow

5.3.3 Cash Flow Projection for Year Third Year

PARTICULARS JAN FEB MAR APP MAY JUNE JULY AUG SEP OCT NOV DEC TOTAL
Cash flow
Balb/f 22410 33010 22840 232700 23430 23620 23790 23920 24360 24120 24727 245000 284047
0 0 0 0 0 0 0 0 0 5 5

22
Bank loan
Cash invested 80000 - - - - - - - - - - - -
0
Sales 38400 38720 36310 388400 38130 38010 37220 37690 37530 37390 37270 371120 454300
0 0 0 0 0 0 0 0 0 0 0
Debtors 13802 13040 12996 131435 13092 13219 12663 12689 12553 12412 16532 126635 158467
5 5 0 5 5 5 5 5 5 5 0
Total cash flow 72522 15606 72958 734895 73783 73961 75019 75142 75542 75666 75990 772500 977344
5 5 5 5 0 5 5 5 0 5 5
Cash out flow
Purchase 21030 20150 20020 186600 18540 17500 17910 17730 17590 17400 17230 170000 220760
0 0 0 0 0 0 0 0 0 0
Insurance 2200 2200 2200 2200 2200 2200 2200 2200 2200 2200 2200 2200 264000
Vehicle 80000 800000
0
Salary &wages 21090 21090 21090 210900 21090 21090 21090 21090 21090 21090 21090 210900 253080
0 0 0 0 0 0 0 0 0 0 0
Electricity 6800 6750 6300 6400 6400 6650 6775 6950 6800 6200 6500 6700 79275
Telephone/ 6800 6750 6300 6400 6550 6650 6670 6310 6500 6520 6410 6350 79275
postage
Water 6700 5670 5550 5450 5800 5810 5770 5650 5800 5750 5700 5500 68150
Transport 2100 21200 22000 19500 19500 20000 20500 21000 22300 2000 23500 24000 257900

23
Stationary 3000 3100 2900 3250 3250 3200 3300 3050 3300 3050 3000 3150 337650
Loan replacement 15625 15625 15625 15625 15625 15625 15625 15625 15625 15625 15625 15625 187500
Advertisement - - - -- - - - 1000 - - - - 1000
Rent 6500 6500 6500 6500 6500 6500 6500 6500 6500 6500 6500 6500 78000
License/permit 1000 - - - - - - - - - - - 1000
Furniture/fittings - - - - - - - - - - - -- -
Creditors 16000 16200 16300 16800 16800 17500 17500 17450 17500 17600 17500 17700 203750
Miscellaneous 38,000 3200 3150 2850 2950 2910 17000 17450 17500 17600 17600 17500 203750
0
Total cash output 49551 47852 46942 472102 47378 47378 47597 48447 48482 18432 48407 48325 624585
25 5 5 5 5 5 5 5 5 5 5
Ending cash flow 20650 20810 21100 212500 21250 21450 21900 21900 22130 22250 22350 224100 258880
0 0 0 0 0 0 0 0 0

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5.4 Proforma Income Statement
ITEM 1ST YEAR 2ND YEAR 3RD YEAR

Sales 3117500 4844500 12632200

Cost of goods 1130000 750000 705000

Profit 3987500 4094500 11927200

EXPENSES

Salaries 864000 864000 864000

Rent 60000 60000 60000

Water bill 9750 8800 8250

Telephone bill 17600 9350 7859

Electricity bill 23600 19700 17350

Advertisement 22000 14000 26500

Stationeries 60000 11600 114000

Maintenance 10500 12500 19000

Cash purchase 18800 140000 103000

Insurances 60000 60000 60000

Registration 2000 2000 2000

TOTAL EXPENSES 1317450 130350 1281950

Profit before tax 2442050 1191150 962200

Tax provision 357345 288660

Net profit 1709435 833805 673840

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5.5 Proforma Balance Sheet
ITEM YEAR 1 YEAR 2 YEAR 3

CURRENT ASSETS

Cash at hand 100000 357550 484200

Cash at bank 100000 20000 30000

Total current assets 200000 377550 517200

FIXED ASSETS

Machinery 90000 100000 140000

Furniture & fitting 15000 20000 25000

Total fixed assets 105000 120000 165000

TOTAL ASSETS 305000 497550 482200

CURRENT
LIABILITIES

Creditors 50000 60000 75000

Total current 50000 60000 75000

liabilities

LONG TERM
LIABILITIES

Bank loan 200000 250000 300000

Capital employed 100000 225650 254400

Total long term 300000 475650 554400

liabilities

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 TOTAL 350000 535650 629400
LIABILITIES

5.6 Desired Financing

ITEM AMOUNT

Pre-operational cost 90,200

Working capital (stock) 400,000

Furniture &fitting 15,000

Machines & computers 90,000

Production facilities 124,020

Total financial investment 719,220

5.7Proposed Capitalization

ITEM AMOUNT (KSH)

Owner’s contribution 1000,000

Total borrowed (funds) 100,000

Loans (banks) 500,000

Creditors 200,000

Total investment 1,800,000

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 REFERENCES
Entrepreneur class notes

Erick H (2001). The nature of financial statements, cash follow statements, financial analysis
tool and techniques, a guide for manager, McGraw Hill, Jal. K.p. (1999) operational risks
management New York Inc 250 wireless, Boulevard; Hauppauge

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 APPENDIX: MILESTONE SCHEDULE
Timeline Task

Jan 2023-March 2023 -Choice of the business topic

April 2023-May 2023 -Writing chapter one, two &three

-Presentation of a draft for correction

-Correcting chapter one, two & three.

September 2023 -Writing chapter four, five & six

-Presentation of draft for correction

October 2023 -Typing corrected project

October 2023 -Presentation for approval and examination to

KNEC.

29