BUSINESS PLAN

GLADSOME CONSULTANCY

INSTITUTION : OL’LESSOS TECHNICAL TRAINING INSTITUTE

PRESENTED BY : MUIGEI NATHAN KIMARU

INDEX NO :295410010387

PAPER NO : 307B

COURSE CODE :1903

DEPARTMENT :BUSINESS

SUPERVISOR ;MR. AMOS RUTO

PRESENTED TO KENYA NATIONAL EXAMINATION COUNCIL IN

PARTIAL FULFILLMENT FOR AWARD IN CERTIFICATE IN SUPPLY CHAIN

MANAGEMENT

SERIES : JULY 2019

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 DECLARATION
I declare that the work contained herein is my original work and none like this has ever been presented
to the Kenya national examination council.

Signature……………………………………………………Date…………….……………………

NAME: MUIGEI NATHAN KIMARU

This business plan is submitted to the Kenya national examination council with my approval

Signature…………………………………….......................Date……….………………………….

SUPERVISOR’S NAME: MR. AMOS RUTO

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 DEDICATION
My dedication goes to my family member, friends and all who have spent and gave out their resources
for the completion of this business plan.

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 ACKNOWLEDGEMENT
My appreciation goes to my family members who have of great help to me through this work.
I would also like to recognize my able supervisor who have worked tirelessly to see my success in this
work.
May the Almighty God bless you all.

Thank you.

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 TABLE OF CONTENT
BUSINESS PLAN i
DECLARATION ii
DEDICATION iii
ACKNOWLEDGEMENT iv
TABLE OF CONTENT v
EXECUTIVE SUMMARY vii
CHAPTER ONE 1
1.0 BUSINESS DRISCRIPTION 1
1.1 BUSINESS NAME 1
1.2 BUSINESS LOCATION 2
1.3 BUSINESS OWNERSHIP 2
1.3.1 FORM OF OWNERSHIP 2
1.3.2 OWNERS PROFILE 2
1.4 TYPE OF THE BUSINESS 3
1.5 JUSTIFICATION OF THE BUSINESS 3
1.6 SERVICES 3
1.7 INDUSTRY 3
1.8 GOALS AND OBJECTIVES 3
1.8.1 SHORT TERM GOALS. 3
1.8.2 LONG TERM GOALS 4
1.9 ENTRY ANG GROWTH STRATEGY 4
1.9.1 ENTRY STRATEGY 4
1.9.2 GROWTH STRATEGY 4
CHAPTER TWO 5
2.0 MARKET PLAN 5
2.1 CUSTOMERS 5
2.2 MARKET SHARE 5
2.3 COMPETITION 7
2.3.1 SWOT ANALYSIS OF GLADSOME CONSULTANCY 7
2.3.2 SWOT ANALYSIS OF MWANJO AGENCY 7
2.3.3 SWOT ANALYSIS OF GLADSOME CONSULTANCY 8
2.3.4 HOW TO OVERCOME THE WEAKNESS OF GLADSOME CONSULTANCY 8
2.4 SALE STRATEGY 8
2.5 PRICING STRATEGY 8
2.6 ADVERTISEMENT AND PROMOTIONS 9
2.7 DISTRIBUTION STRATEGY 9
2.8 CHALLENGES EXPERIENCED 9
CHAPTER THREE 10
3.0 BUSINESS MANAGEMENT 10
3.1 ORGANIZATIONAL PLAN 10
3.2 ORGANIZATION AND MANAGEMENT PLAN 10
3.3 OTHER BUSINESS PERSONNEL 12
3.4 RECRUITMENT, TRAINING, SELECTION AND PROMOTION. 12
3.4.1 Recruitment 12
3.4.2 Training 12
3.4.3 Selection. 13
3.4.4 Promotion 13
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3.5 REMUNERATION AND INCENTIVES 13
3.5.1 REMUNERATION 13
3.5.2 Incentives 13
3.6 LEGAL REQUIREMENTS. 13
3.6.1 Trading license 13
3.6.2 Insurance 13
3.6.3 Legal registration 13
CHAPTE FOUR 15
4.0 OPERATIONAL PLAN 15
4.1 REPAIR AND MAINTAINANCE 15
4.2 BUSINESS LAYOUT 16
4.3 OPERATIONAL STRATEGY 16
CHAPTER FIVE 17
5.0 FINANCIAL PLAN 17
5.1 PRE-OPERATIONAL COST 17
5.2 WORKING CAPITAL 17
PROJECTED CASH FLOW STATEMENT FOR YEAR 1 18
PROJECTED CASH FLOW STATEMENT FOR YEAR 2 19
PROJECTED CASH FLOW STATEMENT FOR YEAR 3 20
5.6 BALANCE SHEET 22
5.7 PROFIT AND LOSS ACCOUNT 22
5.8 BREAK-EVEN POINT 23
PROFITABILITY RATIO 24
5.8 DESIRED FINANCING 25
5.9 PROPOSED CAPITALIZATION 25
APPENDIX 26

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 EXECUTIVE SUMMARY
Gladsome consultancy is a business that will deal in selling consultation services regarding social
development issues, like guiding and educating self-help groups, youth groups, women groups, linking
and helping the less fortunate in the community to the right appropriate service providers. The business
is located in Kabazi shopping Centre 35 km North-East of Nakuru CBD. The business is operated
under sole proprietorship form of ownership own by Mr Muigei Nathan who holds a Masters degree in
development studies from Massachusetts University USA. The goals of the business is to provide a the
best quality services to its customers and be competent in the market. It will use various methods to
enter in the market and apply some strategies for the growth and expansion in the market share.
The business is located in highly populated area where there potential customers summing up to a total
of 40,000. Its aim is to meet a 35% of the market share. The potential customers are self-help groups,
women groups, youth groups and individual customers. The business has two competitors who are
Gladsome Consultancy and Mwanjo Agencies sharing 40% and 25% respectively. The business have
identified and have also done the SWOT analysis of its own and for the two competitors as well. It has
laid down price strategy to make its services affordable and easy accessible by many. There shall be
promotions, advertisements to enable the business reach many.
In chapter three, the business has already organizational structure for easier operations. There are
various personnel working for this business. The top in the business is the Managing Director followed
by the Assistant Managing Director, secretary, accountant, consultation officers and the security guard.
They have different qualifications basing to their responsibilities in the business. The business aims at
maintaining a good customer relation through the performance of this team. Apart from the salaries, the
business shall be providing allowances to the employees for motivation. It has acquired a legal
registration from the national and county governments to ensure that the business is legally operated.
The business management have insured the business properties under an insurance cover through Blue
Shield insurance company.
The business will be operating by selling services to the customers. It has purchased the necessary
equipment to enable it operate smoothly and satisfy the customers. There are various items which have
already been bought for the business. The business has acquired some capital for the operations.
Chapter five is the last in this business plan and it contains the financial report for the business. These
records are the cash flow statements, balance sheet, break even analysis to enable the management
understand the financial condition of the business. The working capital for the business is ksh 580,000

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 CHAPTER ONE
1.0 BUSINESS DRISCRIPTION
This business will deal with consultation services regarding social development issues. Its main areas of
services to the customers will be guiding and educating self-help groups, youth groups, women groups,
and linking the less fortunate in the community to receive the right and appropriate services from the
service providers. It will also deal with advocating for the elderly persons, children’s right among others
which are rarely available to the community.

1.1 BUSINESS NAME

The business operates under the below name GLADSOME CONSULTANCY which was derived from its
deeper meaning-happy joyous. The business owner chose this name because he have a great expectations
that the customers shall receive services which will cheer them and make them feel joyous. The name is
easy to pronounce and also to remember.

GLADSOME CONSULTANCY
P.O BOX 2011-20114
KABAZI

Phone no. 0722731143

Email address: gladcon@gmail.com
Website: www.gladcon.co.ke

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1.2 BUSINESS LOCATION
The business is located along Nakuru – Nyahururu highway 35km North-East of Nakuru CBD at Kabazi
shopping centre in Kajm’s Acade opposite Kiwa complex centre in Mwam street.

1.2.1 Business location sketch map

FROM NAKURU TO NYAHURURU

GLADSOME
CONSULTANCY

The reason why the owner chose this location is because of its easier access and nearness to the main
road. The building where the business in located is well constructed so as to make sure all the categories
of customers are able to get in like persons living with disabilities. There is a big parking area to those
with Motor vehicles.

1.3 BUSINESS OWNERSHIP

1.3.1 FORM OF OWNERSHIP

The business operates under sole proprietorship form of ownership. This is a type of enterprise that is
owned and runned by one person as the manager and has the authority.
The owner will have the following advantages:
 Easy decision making
 The owner takes all the profit
 The owner keeps all the secrets
 He has the authority over the subordinate

1.3.2 OWNERS PROFILE

The owner of the business in Mr Muigei Nathan who holds a certificate in Supply chain management .

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He have worked for different international and local institution making him acquire adequate skills,
knowledge and experience in operating this kind of business. He will also contribute in investing his
resources like capital of cash Ksh 300,000 and a vehicle to aid in transport.

1.4 TYPE OF THE BUSINESS

Gladsome Consultancy is a business which will be dealing with services in the consultation of social
issues. The business will be linking the customers to the service providers and also impart knowledge in
them. It is a startup business which will begin its operations soon.

1.5 JUSTIFICATION OF THE BUSINESS

The business owner chose this opportunity because the consultation industry has not been entered much
by other investors. The area that the business is located has an easy access for the customers. The business
have high chances of capturing a big market share because there are only two competitors in the market.
The business has also high chances of succeeding due to availability of good communication networks,
qualified personnel and high quality equipment to be used in the office and in the service delivery.

1.6 SERVICES
Gladsome consultancy will deal with offering consultation services to the customers. The services are
related to social development field. They are linking the customers with the service providers. The main
services are advocating for human rights, like children rights, assisting self-help groups, youth groups,
community organizations, guiding all who require the services. The services shall be offered directly from
the officers to the customers. The services will be offered throughout all the annual seasons and to all the
customers.

1.7 INDUSTRY
This service offering market has not been ventured much by man by many investors because of the fear to
deal with issues pertaining to service offered one-on-one. In this industry, technology advancement have
popped in to enhance and ensure that the service delivery is well done. The business will purchase some
computers, mobile phones, printer machine, photocopier among others equipment. In this industry,
customers do come to buy the services right from the business unlike in the production while the
producers take to finished goods to the customers.

1.8 GOALS AND OBJECTIVES

The business goals are to ensure that customers needs are satisfied.
Encouraging the employees and the managers to utilize all their acquired knowledge and skills effectively
and efficiently for the growth and expansion of the business.
The business goals are divided into two categories i.e short term and long term goal:

1.8.1 SHORT TERM GOALS.

 To satisfy customers and employees interests
 To create employment opportunity
 Profit maximization through maximum cost.
 To offer high quality service.
 Generate income through profit.

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 

1.8.2 LONG TERM GOALS

 Expansion or the growth of the business/
 Employing adequately modern technology in conveying information and storage of data from the
customers.
 Raising the knowledge level of the community members
 To be the most competent consultancy agency within and beyond the region.

1.9 ENTRY ANG GROWTH STRATEGY

1.9.1 ENTRY STRATEGY

The business has put some strategies in place to enable it enter into the service industry effectively.
There are advertising methods which identified and will help the easy penetration of the business
information in the market and to the customers. The methods include the mass media, posters, sending of
SMS, printing media like fliers and many more. There will also be free training to the women groups,
youth groups, self-help groups in specific occasions.

1.9.2 GROWTH STRATEGY

The business aims at growing and increasing the number of the customers it will be serving annually. This
will be achieved by motivating the employees to make them work well for the business and keep a good
customer relation. The business will provide the customers with extra advantage to those customers who
will be purchasing the services frequently.

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 CHAPTER TWO
2.0 MARKET PLAN
Market plan will play a major role in the business through promotion and advertising of the business
services thus attracting more customers.

2.1 CUSTOMERS
They are people who are able to buy the services from the business. The business intends to offer a
variety of services to different categories of people. The customers who will be buying our services are:
Individual customers
These are the members of the community who will be buying the services either in person i.e individual
or families. Since the business deals with social issues, the business will extend its hand to assist the
couples, young adults and those who will need the services.
Groups
The other customers will be self-help groups, women groups, youth groups and communities. The group
of people are also potential customers to our services. To this, the business will be selling the services by
going in the ground to meet them during their meeting.

2.2 MARKET SHARE

The business will be located in a highly populated area thus the utility of the services will be also high.
The targeted area the business will be offering its services to the entire Kabazi location and its outcasts.
Though there are other competitors in this field of consultancy, the business intends to be covering the
biggest part of the share. The area shows that the location has a population of 40,000 people comprising
of different personalities and status. The business share in the market is 35% and it intends to do more to
reach many customers.

NAME PERCENTAGE %
GLADSOME CONSULTANCY 25%
MWANJO AGENCY 40%
GLADSOME CONSULTANCY 35%

The business intends to serve about 14,000 people within the first year of its operations and receive an
increment as the time goes by…

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No of customers 100
Total population

Gladsome consultancy 14000 x 100 = 35%

40000

Mwanjo Agency 16000 x 100 = 40%

40000

Gladsome Consultancy 10000 x 100 = 25%

40000

market share

Gladsome
consultancy

Mwanjo agency

Pata consultant

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2.3 COMPETITION
Gladsome Consultancy will be having different competitors who are GLADSOME consultancy and
MWANJO agency. Gladsome consultancy is situated in a place where all the customers are able to access
and buy its services. It acts as a meeting point since MWAM street is a busy street.

GLADSOME AGENCY
P.O BOX 46-20114
KABAZI

MWANJO CONSULTANCY
P.O BOX 212-20114
KABAZI
Name of the business Age in the market Form of ownership
Gladsome consultancy Newly opened Sole proprietorship
Mwanjo agency 2 years Partnership
Gladsome consultancy 1 Sole proprietorship

2.3.1 SWOT ANALYSIS OF GLADSOME CONSULTANCY

Strength
Gladsome consultancy is situated at a busy street in a well standard class building. Most customers are
able to access because of its nearness to the main road and the highway. The business has invested a lot of
capital to make sure that the customers are comfortable with the service provided by the business. The
personnel working for the Gladsome consultancy are professionals where they will offer the best services.
The business will be opening up early at 8:00am and close at 6:00pm from Monday to Thursday and
8:00am to 3:00pm on Friday and Sunday.

Weakness
The business lacks enough money to expand the room it operates from, this could enable more customers
to sit and wait comfortably for their turn of services. The business also lacks enough vehicles to aid in
transport for its employees and when reaching members of the community.
Opportunities
Gladsome consultancy is located at a very strategic place which is so accessible by many customers and
therefore gaining more market share. Gladsome has more qualified personnel who offers professional
services and deals with a wide range of issues in the community around.

Threats
The greatest threat to the business is Mwanjo Agency who have more capital due to its shareholders
contribution. Gladsome consultancy does have an international donor who funds the business.

2.3.2 SWOT ANALYSIS OF MWANJO AGENCY

Strength
Mwanjo agency has more capital invested in the business hence enabling them offer free service
regularly. There are more partners in the business which makes the operational cost less, and affordable to
their customers.

Weakness
Mwanjo Agency has a challenge in coordinating workers to attend to the customers effectively; their

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workers are not professionals thus making the learned customers doubt their services.

Opportunity
Mwanjo agency ventured in the business early before any other investor had entered to this business. Due
to the partnership which have made them add new ideas more often.

Threats
The main threat of Mwanjo agency is Gladsome consultancy which is growing at a very high rate thus
making the business loose its potential customers. The site where the business is located has now been
overcrowded by building making it difficult for the customers to access it.

2.3.3 SWOT ANALYSIS OF GLADSOME CONSULTANCY

Strength
Gladsome consultancy has more capital due to the international donors it has who funds the business.
This has made them grow rapidly by attracting more customers from offering low costly services. This
business has also made an agreement with community based organization for two years which made them
operate throughout.
Weakness
Gladsome consultancy lacks professional personnel who can execute the objectives of the business. They
also operate from a small room which cannot accommodate many customers in a moment. Gladsome
consultancy do not have no vehicle which can aid the management in transport.

Opportunity
Gladsome consultancy have an opportunity in the maket due to the adequate funds it has fro the donors.
This makes them thrives effectively even amid other challenges. Their customers have been enjoying their
services and also the organization they agreed with previously.
Threats
There are two threats to the business which are Mwanjo Agency and Gladsome consultancy who are
growing and narrowing its market share rapidly. The business is facing a difficult in serving their
customers due to the professional services they are getting from other related business.

2.3.4 HOW TO OVERCOME THE WEAKNESS OF GLADSOME CONSULTANCY

The management has set some strategies to ensure the business will overcome the weakness it has faced.
The management will increase the working capital. This will make the required resources sufficient,
execution of the service will be smooth, and the rooms shall be increased and equipped with the office
items. The employees will be receiving a double allowance when they serve many customers than the rest
in a duration of time. The management will begin management method of management by objectives so
as to enable every employee aware of the business objectives. All these and many more to be
implemented shall enable the business thrive successfully.

2.4 SALE STRATEGY

Gladsome consultancy will be selling its services by using negotiation method of selling. This will be
done on one-on-one basis. The employee will have a good interpersonal relationship with the customers
and make sure they have received a good customer care. There will be recruiting and training of
employees on sincerity and honest service delivery to enable them offer a competent services. The
customers will be coming to the office to receive the service in direct form.

2.5 PRICING STRATEGY

The business will use various methods to ensure that the price of their services are fair and can be

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affordable to all.
The business will use the following:
Penetrative: it will begin by setting low prices of the service and increase them gradually as the time
goes.
Scheming: the business will set a high price list to confuse its competitors but the customers shall receive
the services at a normal price.
Psychological: the business will use this method to attract more customers. This is is recuding one
shilling from a certain amount eg ksh 999 instead of 1000.

2.6 ADVERTISEMENT AND PROMOTIONS

The business will be using different methods of advertisements through the following:
Mass media
In this method, the business will use television, and radio to advertise its services. These are mostly
available to many people since it is easy for them to acquired.
Social media
This channel is mostly used by young people together with the learned persons in the society. In social
media, the business has chosen facebook, instagram and whatsapp to advertise its services.
Public speaking
This is direct contact with the customers by either lecturing or offering training services. The business
will be speaking to public in time after the other.

2.7 DISTRIBUTION STRATEGY

The business will be offering the services directly from the consultant officer. Where a group or an
institution requires the business services, the employees will be going to the ground for service delivery.
The means of transport which will be used will be road.
The type of distribution channel to be used will be

Services provider customer

2.8 CHALLENGES EXPERIENCED

There is no business which does not experience some challenges. One of the challenges the business will
face is a spacious room for the operations, this will make the customers to stand in the office rather than
sitting comfortably while waiting for their turn to be serviced. The solution to this challenges is that the
business will lease a room in the next door brsides the business and partition it in various sections to cease
the situation.

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 CHAPTER THREE
3.0 BUSINESS MANAGEMENT
The management team will comprise of manager, assistant manager, secretary, accountant, consultant
officers. The below is the organizational plan.

3.1 ORGANIZATIONAL PLAN

M MANAGING DIRECTOR

SECRETARY

ASSISTANT MANAGING DIRECTOR

ACCOUNTANT CONSULTANT OFFICERS SERCURITY GUARD

3.2 ORGANIZATION AND MANAGEMENT PLAN

The key operator of the business are the managing director and the assistant managing director. The
managing director holds a Masters degree in Developmental studies and Bachelor degree in sociology
from Massachusetts University and have worked for various local and international organization hence
making him competent in this business.

MANAGING DIRECTOR
Responsibilities of the managing director
 Heading all the business operators.
 Managing all the business finances.
 Coordinating all the business activities and the employees.
 Recruiting, employing, promoting, and advising the business personnel.

QUALIFICATIONS
 Have managerial skills
 Have leadership skills and knowledge
 Have competence, self-belief, good customer relation
 Have at least a bachelor degree
ASSISTA.NT MANAGING DIRECTOR
Responsibilities
 Assisting the managing director in the business operations
 Act as the managing director when the manager is out for duties.

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  Signing incoming and outgoing invoices, delivery orders and vouchers
QUALIFICATIONS
 Diploma in social work and community development
 Have at least three years of experience
 Have knowledge in social development services needed around the location.

ACCOUINTANT
Responsibilities
 Maintaining all books of account and advising the management pertaining to financial issues.
 Pay salaries to the employees
 Hiring and leasing assets needed by the business
 Depositing business money in the bank

QUALIFICATIONS
 Diploma in Accountancy
 At least two years of experience in financial field
 Able to keep financial records.

SECRETARY
Responsibility
 Organizing management meeting
 Making the managing director and his assistant comfortable in their offices.
 Keeping all the secretarial report and books
 Acting as the receptionist.
QUALIFICATIONS
 Diploma in secretarial studies
 At least two years of experience

CONSULTATION OFFICERS
Responsibilities
 Offering one on one consultation services
 Ensuring the customers are well served by directing them appropriately
 Linking the customers to the relevant service providers.

QUALIFICATIONS
 Diploma in social work
 At least three years of experience
 Counselling skills
 Good interpersonal relation, communication and competence in the service

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3.3 OTHER BUSINESS PERSONNEL

SECURITY PERSONNEL
Responsibilities
 In charge of security to all the employee during working hours and business properties all the
time.
 Ensure that the doors and the windows are safely locked after the job.
 Organizing the customer and reporting people of the suspicious character to the business
authorities.
QUATIFICATION
 KCSE C- (Minus)
 Certificated of good conduct
 Have relevant guarding skills.
 Must be a member from the local community.

3.4 RECRUITMENT, TRAINING, SELECTION AND PROMOTION.

3.4.1 Recruitment
This is the process of identifying potential employee with high and qualified required for them to work
for the business, this enhances the growth and the expansion of the business. It is necessary to ensure that
the business has enough manpower to meet the demand and the methods of growth in recruiting the
employees.

3.4.2 Training
This is the process of imparting new information and skills to the employees. The business intends to
provide study guide for the employees who require extra training. There will be monthly seminars to all
workers of the business in pursuit of smooth running of the business operations.

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3.4.3 Selection.
This is the process of choosing employee who qualify regarding to the business’s demand. This will be
done by comparing the competence of the employees who have been interviewed.

3.4.4 Promotion
This is advancing the employees from various positions to higher rank. The business intends to motivate
its employees who will be working well than others in their duties and those who advances in their
education while working in this business.

3.5 REMUNERATION AND INCENTIVES

3.5.1 REMUNERATION
RANKS NO. OF SALARIES ALLOWANCES TOTAL
EMPLOYESS
Managing Director 1 20,000 4,000 24,000
Ass. Managing Director 1 15,000 3,500 18,500
Accountant 1 10,000 3,000 13,000
Secretary 1 9,000 3,000 12,000
Consultant Officers 2 10,000 3,000 26,000
Security guard 1 7,000 2,000 9,000
Total 102,500

3.5.2 Incentives
This is giving or rewarding the employees with some amount of money which will motivate and
encourage them to work effectively for the business. Other incentives not included here will be overtime
allowances.

3.6 LEGAL REQUIREMENTS.

3.6.1 Trading license

Trading license will be necessary so as to grant permission to the business owner by the government or
local authorities. This enables the business to operate smoothly and be legal before the law.

3.6.2 Insurance
Considering the business equipment and other properties, there must be measures to reduce or prevent
risk when they arise. The business will be insured with BLUE SHIELD INSURANCE Company. The risk
insured are fires, theft, and accident during working hours. The business will be insured in annual basis of
Ksh 10,000.

3.6.3 Legal registration

This is the legalizing the business personnel to the National consultant board which will enable the
consultant officers to offer professional and legal services. This is done to reduce counterfeit workers who
cons the customers and misleads them. The business has registered its employees to avoid any
inconveniences.

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 BANK AND POSTAL SERVICES
THE BANK SERVICES WILL BE PROVIDED BY
NATIONAL BANK OF KENYA (NBK)

ADDRESS NATIONAL BANK OF KENYA

P.O BOX 1001-20100
NAKURU
Postal services and communication
The Kenya Posta will provide postal services while telecommunication and other communication services
will be provided by Safaricom, Airtel and Telcom Kenya networks.
Business email: gladcon@gmail.com

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 CHAPTE FOUR
4.0 OPERATIONAL PLAN
This will explain how the services are offered from the provided to the customers.
Since this business deals with service delivery, there will be no production of goods. Gladsome
consultancy will have adequate facilities at the start of its operation and more will be added as the time
goes by.
The main requirements of the business will be an office, office equipment, stationaries, computer,
telephone and furniture.
The following is the list of the items needed.
Items Qualities Cost per unit (Ksh) Total cost
Stationary 3 dozen 1000 3,000
Computer 2 pair 25,000 50,000
Telephone 1 4000 4000
Furniture 4 1000 4000
Rent 12 months 5000 60,000
Tables 2 900 1800
Electricity 12 months 4800 58800
Letter shelves 2 400 800
Total 182,400

4.1 REPAIR AND MAINTAINANCE

The business has made an agreement with Josma works to be offering repair services when the business
equipment breaks down.
Ismac technologies will be providing ICT expertise to the business when it will install the CCTV cameras
and new computer programs.

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4.2 BUSINESS LAYOUT
The below is the layout of Gladsome consultancy.

OFFICE OFFICE
STORE MANAGING
1 2 DIRECTOR

ENTRY AND EXIT

RECEPTION ASSISTANT
MANAGER
SERCURITY

4.3 OPERATIONAL STRATEGY

People around the town and its surroundings will be enjoying the fair services from Gladsome
consultancy. The business intends to adopt an easy effective strategy so as to provide or produce its
services at the cheapest price possible, affordable to the customers and also minimize the losses for profit
maximization.

Services Session Amount (Ksh)

Groups 1 1000
Families 1 700
Children 1 500
Institutions 1 1500

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 CHAPTER FIVE
5.0 FINANCIAL PLAN
The business financial plan shows the estimate for the future operations based on quality and quantity
services delivery and will be used as the budget. Its pre-operation cost working capital estimate and cash
flow projection, balance sheet, break even analysis and profitability ration.

5.1 PRE-OPERATIONAL COST

ITEMS AMOUN (KSH)
Equipment cost 63,000
Trading license 13,000
Electricity deposits 5000 per month
Telephone deposits 15,000
Insurance 10000
Total 106,000

5.2 WORKING CAPITAL

ITEMS YEAR 1 YEAR 2 YEAR 3
STOCK IN PROGRESS 30,000 35,000 40,000
DEBTORS 30,000 40,000 35,000
CASH IN HAND 300, 000 1,638,350 3,010,400
TOTAL 360000 1713350 3085400
GRANTS 200,000
UNPAID EXPENSES 20,000 37,000 33,000
TOTAL 580,000 1,750,350 3,118,400

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 PROJECTED CASH FLOW STATEMENT FOR YEAR 1

PARTICULARS JAN FEB MAR APR MAY JUNE JULY AUG SEP OCT NOV DEC TOTAL

CASH SALE 328350 633300 819650 855150 790150 672150 557300 442300 527250 612200 694400 6930200
CAPITAL
INTRODUCTION 300000 250000 200000 100000 50000 - - - 200000 200000 200000 200000 2150000

GRANTS 200000 170000 100000 50000 - - - - - - - - 520000

STOCK IN
PROGRESS 30000 - - - - - - - - - - - 30000

TOTAL 530000 748350 933300 969650 905150 790150 672150 557300 642300 727250 812200 894400 9182200
SALARIES &
WAGES 102500 102500 102500 102500 102500 102500 102500 102500 102500 102500 102500 102500 1230000

RENT 5000 5000 5000 5000 5000 5000 5000 5000 5000 5000 5000 5000 60000

ELECTRICY 5000 5000 4500 4500 5000 5000 4900 5000 5000 5000 5000 4900 58800

WATER 300 300 300 250 250 250 200 250 300 300 250 300 2250

EQUIPMENT 59800 - - - - - - - - - - - 59800

LICENCE 13000 - - - - - - - - - - - 13000

TRANSPORT 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 12000

INSURANCE 10000 - - - - - - - - - - - 1000

TELEPHONE 1250 1250 1250 1250 1250 1250 1250 1250 1250 1250 1250 1250 15000

STATIONARY 3800 - - - - - - - - 3000 - 2800 9600

TOTAL 201650 115050 113650 114500 115000 118000 114850 115000 115050 115050 117800 114750 1585400

NET PROFIT 328350 638300 819650 855150 790150 672150 557300 442300 527250 612200 694400 779650 7596800

BALANCE B/DOWN 328350 961650 1781300 2636450 3426600 4098750 4656050 5010825 5625600 6237800 6874675 7596800

18
 PROJECTED CASH FLOW STATEMENT FOR YEAR 2

PARTICULARS JAN FEB MAR APR MAY JUNE JULY AUG SEP OCT NOV DEC TOTAL
BALANCE
B/FORWARD 776950 918250 802550 886900 971250 1055650 1136050 1220500 1304900 1389350 1473750 1554050 13490150
CASH SALE 200000 200000 200000 200000 200000 200000 200000 200000 200000 200000 200000 2200000
GRANTS 150000 - - - - - - - - - - - 150000
TOTAL 1126950 918250 1002550 1086900 1171250 1255650 1336050 1420500 1504900 1589350 1673750 1754050 15840150
SALARIES &
WAGES 102500 102500 102500 102500 102500 102500 102500 102500 102500 102500 102500 102500 1230000
RENT 5000 5000 5000 5000 5000 5000 5000 5000 5000 5000 5000 5000 60000
ELECTRICITY 5000 5000 5000 5000 5000 5000 5000 5000 5000 5000 5000 5000 60000
WATER 400 400 350 350 300 300 250 300 250 300 400 400 4000
EQUIPMENT 65000 - - - - - - - - - - - 65000
LICENSE 13000 - - - - - - - - - - - 13000
TRANSPORT 1500 1500 1500 1500 1500 1500 1500 1500 1500 1500 1500 1500 18000
INSURANCE 10000 - - - - - - - - - - - 13000
TELEPHONE 1300 1300 1300 1300 1300 1300 1300 1300 1300 1300 1300 1300 15600
STATIONARIES 5000 - - - - 4000 - - - - 4000 - 13000
TOTAL 208700 115700 115650 115650 115600 119600 115550 115600 115550 115600 119700 115700 1488600
NET PROFIT 918250 802550 886900 971250 1055650 1136050 1220500 1304900 1389350 1473750 1554050 1638350 14351550
BALANCE
B/DOWN 91850 1720800 2607700 3578950 4634600 5770650 6991150 8296050 9685400 11159051 12713200 14351550

19
 PROJECTED CASH FLOW STATEMENT FOR YEAR 3

PARTICULARS JAN FEB MAR APR MAY JUNE JULY AUG SEP OCT NOV DEC TOTAL

BALANCE B/FORWARD 1638350 1611150 1737950 1864750 1986600 2113500 2239400 2366300 2493150 2625000 2781800 2878600 26306550

CASH SALES 250000 250000 250000 245000 250000 255000 250000 250000 255000 250000 250000 255000 3010000

GRANTS - - - - - - - - - - - - -

TOTAL 1838350 1861150 1987950 2109750 2236600 2368500 2489400 2616300 2748150 2875000 3001800 3133600 29266550

SALARIES & WAGES 110000 110000 110000 110000 110000 110000 110000 110000 110000 110000 110000 110000 1320000

RENT 5000 5000 5000 5000 5000 5000 5000 5000 5000 5000 5000 5000 60000

ELECRICITY 5000 5000 5000 5000 5000 5000 5000 5000 5000 5000 5000 5000 60000

WATER 400 400 400 350 300 300 300 350 350 400 400 400 4350

EQUIPMENT 70000 - - - - - - - - - - - 70000

LICENSE 13000 - - - - - - - - - - - 13000

TRANSPORT 1500 1500 1500 1500 1500 1500 1500 1500 1500 1500 1500 1500 18000

INSURANCE 10000 - - - - - - - - - - 10000

TELEPHONE 1300 1300 1300 1300 1300 1300 1300 1300 1300 1300 1300 1300 15600

STATIONARIES 6000 - - - 6000 - - - - - - 12000

REPAIR &
MAINTAINANCE 5000 - - - - - - - - - - - 5000

TOTAL 227200 123200 123200 123150 123100 129100 123100 123150 123150 123200 123200 123200 1587950

NET PROFIT 1611150 1737950 1864750 1986600 2113500 2239400 2366300 2493150 2625000 2751800 2878600 3010400 27678600

20
BALANCE B/DOWN 1611500 3349100 5213850 7200450 9313950 11553350 13919650 16412800 19037800 21789600 24668200 27678600

21
5.6 BALANCE SHEET
PARTICULARS YEAR 1 YEAR 2 YEAR 3
FIXED ASSESTS
FUNITURE 4000 5000 6000
EQUIPMENT 59600 65000 70000
TOTAL 63600 70000 76000
CURRENT ASSESTS
DEBTORS 30000 40000 35000
CASH AT HAND 300000 1638350 3010400
TOTAL 393600 1748350 3121400
CAPITAL 173600 1611350 2968400
GRANTS 200000
CURRENT
LIABILITIES
CREDITORS 100000 120000
UNPAID EXPENSES 20000 37000 33000
TOTAL LIABILITIES 393600 1748350 3121400

5.7 PROFIT AND LOSS ACCOUNT

PARTICULARS YEAR 1 YEAR 2 YEAR 3

CASH SALE 6939200 13490150 26306550
GROSS PROFIT 9182200 15840150 29266550
SALARIE & WAGES 1230000 1230000 1320000
RENT 60000 60000 60000
WATER 2250 4000 4350
ELECTRICITY 58800 60000 60000
TELEPHONE 15000 15600 15600
STATIONARIES 9600 13000 12000
TRANSPORT 12000 18000 18000
REPAIR & MAINTAINANCE 5000
INSURANCE 10000 10000 10000
TOTAL EXPENSES 1397650 1410600 1504950
NET PROFIT 7785150 14429550 27761600

22
5.8 BREAK-EVEN POINT

FIXED EXPENSES AMOUNT VARIABLES EXPENSES AMOUNT

SALARIES 123000 ELECTRICITY BILL 58800
RENT 60000 STATIONARIES 9600
WATER 2250 TRANSPORT 12000
LICENSE 13000
INSURANCE 10000
TELEPHONE 15000

TOTAL 223250 TOTAL 80400

Contribution margin = variables expenses x 100

Sales price

= 80400 x 100 = 11.6%

693020

Percentage Difference == 100%-11.6% = 88.4%

Break-even point = fixed expenses

Percentage

223250 = 252545.25
0.884

23
PROFITABILITY RATIO
(i) Return on sales = Net profit x 100
Total sales
For 2019 = 7596800 x 100 = 109.6%
6930200

For 2020 = 14351550 x 100 = 106.38%

13490150
For 2021 = 27678600 x 100 = 105.21%
26306550

Return on equity = net profit

Capital + net profit

2019 7596800 x 100 = 97%

173600+ 7596800

2020 14351550 x 100 = 98%

173600 + 14351550

2021 27678600 x 100= 99%

173600+ 27678600

24
5.8 DESIRED FINANCING
ITEM AMOUNT KSH
PRE-OPERATIONAL COST 106600
WORKING CAPITAL 580000
FIXED ASSEST 63600
TOTAL 750200

5.9 PROPOSED CAPITALIZATION

PARTICULARS AMOUNT
OWN CONTRIBUTION 300000
GRANTS FROM THE FAMILY MEMBERS 200000
LOAN 200000
TOTAL 700000

25
APPENDIX

SKETCH MAP

FROM NAKURU TO NYAHURURU

GLADSOME
CONSULTANCY

26