BUSINESS PLAN

ELDORET TECHNICAL TRAINING INSTITUTE

BUSINESS NAME: VICTOR’S GROCERY SHOP

P.O BOX 770-30100, ELDORET

PRESENTED BY: KIBET VICTOR

INDEX NO: 5092260044

CENTRE CODE: 509226

COURSE CODE: 1909/107

PAPER NO: 107A

DEPARTMENT: BUSSINESS DEPARTMENT

CENTRE: ELDORET TECHNICAL TRAINING INSTITUTE

PRESENTED TO: THE KENYA NATIONAL EXAMINATION

COUNCIL FOR PARTIAL FULFILLMENT FOR
THE AWARD OF CERTIFICATE IN TRANSPORT
FLEET AND LOGISTICS MANAGEMENT.

SUPERVISOR: MADAM ROSE

EXAMINATION SERIES: JULY 2024

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 DECLARATION
I declare that this handout is my original project established after a through researcher
Also assure that this handout has never been presented to any examination body by anyone
else.
STUDENT’S NAME: VICTOR KIBET

SIGNATURE: ………………………………………….

DATE: …………………………………………………

This project work has been submitted for the examination with my approval as the supervisor

SUPERVISOR’S NAME: MADAM ROSE

SIGNATURE: ………………………………………….

DATE: ………………………………………………….

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 DEDICATION
I sincerely give my gratitude to my mother for my financial support and their encouragement
and prayers that she offered to me.
Also, not forgetting my elder brother for his encouragement, giving me hope that I can make it
in my studies and all those who supported me. May almighty God bless them.

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 ACKNOWLEDGMENT
The completion of this business plan would not have been successful without the moral
support, prayers and encouragement from those people that I highly value.

May all my gratitude’s go to my parents for her financial support, prayers and encouragement
all through my course.

I am also very grateful to my supervisor Madam Rose for his support, direction and advice
during the writing period of the plan. May I also thank all my classmates and my friends who
made my stay at Eldoret Technical Training enjoyable.

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TABLE OF CONTENTS
DECLARATION ……………………………………………………………………i
DEDICATION ………………………………………………………………………ii
ACKNOWLEDGE …………………………………………………………………iii
CHAPTER ONE..........................................................................................................................................1
1.0 EXECUTIVE SUMMARY...............................................................................................................1
1.1 BUSINESS DESCRIPTION..............................................................................................................1
1.2 MARKETING DEMAND.................................................................................................................1
1.4 PRODUCTION AND OPERATIONAL PLANS..............................................................................2

1.5 FINANCIAL PLANS 3

CHAPTER TWO.........................................................................................................................................4
2.0 BUSINESS DESCRIPTION..............................................................................................................4
2.1 BUSINESS NAME............................................................................................................................4
2.2 BUSINESS LOCATION /PREMISES AND CONTACT.................................................................4
2.3 BUSINESS ADDRESS.....................................................................................................................5
2.4 FORM OF BUSINESS OWNERSHIP..............................................................................................5
2.5 PRODUCTS/SERVICES..................................................................................................................6
2.6 JUSTIFICATIONS OF OPPORTUNITIES.......................................................................................6
2.7 TYPE OF BUSINESS AND INDUSTRY.........................................................................................7
2.8 BUSINESS GOALS..........................................................................................................................8
2.9 ENTRY AND GROWTH STRATEGY ENTRY STRATEGY.........................................................8
CHAPTER THREE...................................................................................................................................9
3.2 MARKET SHARE..........................................................................................................................10
3.3 COMPETITION..............................................................................................................................10
3.4 PROMOTION/ ADVERTISING.....................................................................................................11
3.5 PRICING STRATEGY...................................................................................................................11
3.7 DISTRIBUTION STRATEGY........................................................................................................12
CHAPTER FOUR......................................................................................................................................14
4.0 ORGANIZATIONAL PLAN/PEOPLE PLAN................................................................................14
4.2 QUALIFICATION AND DUTIES..................................................................................................15

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 4.3 RECRUITMENT TRAINING AND PROMOTION.......................................................................17
4.4 RENUMERATION AND INCENTIVES........................................................................................18
4.5 LICENSE PERMIT AND BY LAWS.............................................................................................19
4.6 SUPPORT SERVICE......................................................................................................................20
CHAPTER FIVE.......................................................................................................................................21
5.0 PRODUCTION AND OPERATION PLAN...................................................................................21
5.1. OPERATION FACILITIES AND EQUIPMENT..........................................................................21
5.2 PRODUCTION AND OPERATION STRATEGY.........................................................................22
5.3 REGULATION AFFECTING OPERATION..................................................................................25
CHAPTER SIX..........................................................................................................................................27
6.0 FINANCIAL PLAN........................................................................................................................27
6.1 PRE OPERATIONAL COST..........................................................................................................27
6.2 WORKING CAPITAL....................................................................................................................28
6.5. PROJECTED PROFOMA BALANCE SHEET FOR PEJEBI SHOP FOR THE YEAR ENDED
20125, 2026 AND 2027.........................................................................................................................31
6.6. BREAKEVEN ANALYSIS FOR PEJEBI GROCERY SHOP FOR THE YEAR 2025, 2026 AND
2027.......................................................................................................................................................31
6.7 PROFITABILITY RATIO FOR PEJEBI SHOP FOR THE YEAR 2025, 2026 AND 2027...........33
6.8 DESIRED FINANCING.................................................................................................................35
6.9 PROPOSED CAPITALIZATION...................................................................................................35

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 CHAPTER ONE
1.0 EXECUTIVE SUMMARY
It gives general information of the business in brief. It contains five chapters
i. business description
ii. marketing plan
iii. production and operation plan
iv. financial plan

1.1 BUSINESS DESCRIPTION

The name of the business should be called VICTOR’S GROCERY shop it should be
situated in Eldoret, Uasin gishu county.
The business is a sole proprietor selling goods of different kinds. The enterprise
mainly is to maximize profit by meeting the customers’ demands

1.2 MARKETING DEMAND

The potential customers will come from learning institution around the area and
nearby estates in order to attract customer they shall use the poster advertising also it
includes the giving the customers some free samples after lacking the products. The
selling price of the products will be determined by supply and demand.

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1.3 ORGANIZATION AND MANAGEMENT PLAN
The business shall have one personnel manager one accountant also two employees
shall be about four paid monthly to ensure smooth running of the business.
Interview shall be conducted to get the qualified for better management technique

The enterprise also should also organize trip to other cosmetics to acquire new
techniques and skills

Promotion of employees should be practice according to hardworking employees

work permit should be obtained from Mombasa county council and license from trade
ministry and external support from Mombasa.

1.4 PRODUCTION AND OPERATIONAL PLANS

VICTOR’S GROCERY shop shall produce qualified products with minimal cost
involving hiring of machines regularly with the following

Laws regarding employees cost regarding work merits social security funds acts

Public health regulation regarding maintenance of the business surrounding

1.5 FINANCIAL PLANS

The enterprise shall operate at a capital of Ksh 120,000 which are contributed by the
owner 200,000 from 100,000 bank loans and family members.

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 CHAPTER TWO
2.0 BUSINESS DESCRIPTION

2.1 BUSINESS NAME

The business enterprise name is called VICTOR’S GROCERY shop. The name of this
business is derived from the last name VICTOR.I sat my first Kenya certificate of
primary education (KCPE) in the year 2010 and joint Kitany Boys High School for
four years and sat for secondary level for (KCSE)

I victor kibet has the privileged to join Eldoret technical training institute to pursue a
course in medical laboratory technology.

Have already gathered some experienced from college which has enabled me turn to
this kind of business from my elder brothers’ enterprise which he used to operate after
his college studies

The above-mentioned type of business requires 200,000 two hundred thousand and
this amount of money is to be obtained from my family, friends and relatives

2.2 BUSINESS LOCATION /PREMISES AND CONTACT

The business shall be located Eldoret town Annex near school of law along Eldoret
Nakuru Road. It is also near Stabex petrol station.I choose the business to be there
because of the following reasons

i) Good communication network

ii) Availability of security electricity and water

Location of the business is shown in the figure below

ELDORET-NAKURU HIGHWAY

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 VICTORS
GROCERY SHOP

2.3 BUSINESS ADDRESS

VICTOR’S GROCERY SHOP

PO BOX 770-30100

ELDORET.

TEL: 0721596383

2.4 FORM OF BUSINESS OWNERSHIP

VICTOR’S GROCERY SHOP will be sole proprietorship kind of business. The owner
will be the one to handle and manage the business personally
Merits of proprietorship
a) The profit will be all engaged in the owner
b) The decision making will be quick
c) It requires loss formation unlike companies
d) Easy to operate and form
2.5 PRODUCTS/SERVICES
The business enterprise will be offering service according to the like of the customers
the services offered will include
a) Cutting Sukuma wiki and cabbage into small pieces for customers
b) Packing good for the customers in clear paper bags bearing the name of the
business enterprise in it
The products offered will be
a) selling eggs to customers at affordable prices
b) selling carrots
c) selling fresh milk to them at affordable price
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All the above service will be offered at reasonable price to meet the need of the
customers around that particular area

2.6 JUSTIFICATIONS OF OPPORTUNITIES

According to the feasibility study and research which was done the business enterprise
will be the kind of business enterprise which will grow faster since that will be only a
few competitions from nearby business men

VICTOR’S GROCERY shop will create job opportunities to the residents around and
also for school leaver will get a place to work thus getting their daily income.

2.7 TYPE OF BUSINESS AND INDUSTRY

The business enterprise is also sole proprietorship type of business. Its aims to satisfy
the needs of the customers and also create employment opportunities for the people
and by so doing they uplift their living standard

The business enterprise will deal with home consumption products for instance fresh
milk, Sukuma wiki, eggs, carrots etc.

The business offers its service to customers by chopping or cutting Sukuma wiki into
small piece and packing for them into clear polythene bags bearing the name of the
business. The will have to employ seven people to run the business enterprise
successfully to meet its requirement of objectives

The business enterprise is classified under the service industry. The business
enterprise deals with selling products and offering also service to people or to its
client so in this case this kind of products are being widely used by people.

The business experience stiff competition being the facts that in the two nearby
vicinity there are other shop dealing with the same products. These kinds of products
are being daily on day to day activities for daily human consumptions.

The business generated high profits due to price its products to customers at flexible
price which in form affordable to all class of people.

2.8 BUSINESS GOALS

The main aim is to create component opportunities to the surrounding people to
increase stock to meet the demand of the customers aid sell its products at flexible
prices.

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2.9 ENTRY AND GROWTH STRATEGY ENTRY STRATEGY
To enter into the market the proprietor will put poster in town and also highways
which leads to in town

The poster will be located in place that can be seen from distance. Also, in the nearby
formed premises then the calendars paper bags bearing the VICTOR’S grocery shop
will be issued after buying anything from the premises.

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VICTOR’S GROCERY SHOP Customer shall be offered with some attractive service
like cutting Sukuma wiki and cabbages into small piece and packing for them into
attractive paper bags bearing the name of the enterprise

The number of the total number of customers that the management expects to serve
per week is estimated to be two hundred and forty and those customers are employees
from police station, teachers, lectures of different institution and customers from other
parts as Kilifi, Malindi, Taveta etc.

VICTOR’S grocery shop will service its members being both the old and the young

Also, with the industries of that the chalk board will be issued in I indicating the price
of the same products being provided there and also do inform the customers on the
service being offered every day and their prices

Objectives

The owner of the business enterprise will make sure that he introduces new ideas to
the customer in all the town of Mombasa, other grocery in other towns to enable her
to attract to all those customers who are need of the same products and service

CHAPTER THREE
3.2 MARKET SHARE
The business enterprise will be located in Eldoret Annex. Also, the business will be
near Stabex station.

VICTOR’S grocery will be offering service to customers at a lower price those who
are on the same field competing

Also, he will make sure that the products offered are the same but better in quality
these of his competitors making sure that the priority and the preference of the
customers are the most interest.

3.3 COMPETITION
At the same moment there are only few competitors which are bright shiner grocery
shop dealers with the following strategy

i. He has been in the field of grocery shop for two years which she is in position
to know many customers and also how to handle them.

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Also, according to the research taken he has also the following weakness

i. Closing early the business choice at 6.00 when the customers are coming
to shop and go come.
ii. The women are recently too customer i.e. taken a large time to serve the
customers
iii. The women are rude they have no business courtesy and language
iv. The proprietor lives far from the business are hence no personal touch to
the customers.

3.4 PROMOTION/ ADVERTISING

Since VICTOR’S GROCERY will be the kind of its own business to be installed or
started business owner will require some effective method to advertise for it to be
known to all people around Eldoret Annex Area.

The mode of advertisement will be through posters demonstration and use education.
The business enterprise will enhance cases through personal selling will be helpful to
the business and to improve market mix through communication to customers direct.

3.5 PRICING STRATEGY

VICTOR’S GROCERY shop will offer products and service to customer at affordable
price than those of his competitors in doing that the owner will be in the a position to
attract more customer being the main to generate more profit also business owner will
make sure that customers get discounts but it will only be those potential also the
business owner will have to make sure that there is good storage facility such as
refrigerators to keep milk trays for storing eggs. The grocery shop will be well
designed arrange and decorate also all those personnel who will be serving the
customers have to put on white opinion in order for them to be different with other
customers

The business owner will make sure that the following strategies are being observed

a. Good reputation
b. Market dominance
c. Good economies of scale

Also, in conjunction with that the one selling only products situated in the Mombasa
town market has the following strategies

a) Good reputation
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 b) Good economics of scale
c) Market dominance
d) Financial resource is higher

Its weaknesses are;

a) Poor marketing strategy

b) Slow service delivery
c) Lack of management skills

However, the business owner will make sure that VICTOR’S grocery shop has to
capitalized over other competition weakness by living the following strategy.

a) Good marketing strategies

b) Qualified management staff and other personnel
c) Quick service delivery
d) Diversification of business to other stations or town
e) By offering discount

3.7 DISTRIBUTION STRATEGY

The business will be direct interaction to customers which will intend to offer the best
quality service to every client the business owner has made a resolution that the
people who will be serving the customers will be have to be in the same kind of
uniforms to clothes and should means to adhere to every customers promptly to
avoid in efficiencies and time packed in a clean attractive proper bag bearing the logo
of the business enterprise printed on it.

WELCOME TO VICTOR’S GROCERY SHOP

FOR FAST MOVING PRODUCTS EGGS, MILK,

VEGETABLES,

OPEN 24HRS

COME ONE COME ALL

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10
 CHAPTER FOUR
4.0 ORGANIZATIONAL PLAN/PEOPLE PLAN
The entrepreneurship plan is to provide quality service and production the customers
and make profit.

The business enterprise is aimed at producing the best quality and quantity products
and services thus meets the market demand and also according to the customer’s
needs.

 It also aims at exploring the new market ideas with the view measure the
scale
 It aims at sharing of ideas between. Its competitions and the customers
who they are serving
 Its aims at improving people living standard through offering
employment too them

Business manager

Assistant manager

Secretary Sales manager Security Cleaner

4.2 QUALIFICATION AND DUTIES

JOB TITLE

BUSINESS MANAGER

 Be at least 25 yrs. of age

 Diploma in sales and marketing
 At least two yrs. of experience
 Should possess good supervising skills

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Duties

 Overall responsibility of the firm

 Policy development and enforcement in the firm
 Should be someone who can provide guidance supervisor and motivation of the
workers

TERMS OF EMPLOYMENT

 He/ she will be employed on permanent basis into a salary of ksh8,000 per
month.

ASSISTANT MANAGER

 Diploma in sales and marketing with one year working experience

 Ability to working to work with minimum supervision
 Can work under pressure for long and old hours

DUTIES

 Assisting the business manager when he/she is not in

 Making sure that employed personnel report on time
 Also make sure that customer is attended unequal terms

SECRETARY

 Diploma in secretarial duties with one year working experience

 Ability to work with minimum supervision hours
 Computer literate
 Can work under pressure for long

DUTIES

 Bringing in duties required for business

 Arranging appointment and directing visitors/customers with appointment to
correct official
 Answering telephones calls and giving required information
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CLEANERS

 Should be a form four lever

 Well discipline
 Practical social fit

DUTIES

 Making sure that the enterprise is conducive for everybody who comes here
 Also making sure that there are at least one or two buckets for putting liters
 Also making sure that inside the enterprise is clean after 5.30pm when it is
being closed

SECURITY

 At least experience on security for two years

 Minimum age of 28yrs
 At least a form four leaver

DUTIES

 Responsible for the security of the business enterprise

 Keep the gate close at all time
 Making sure that any visitor who wants to see the business manager should
give out his national ID card for the confirmation

4.3 RECRUITMENT TRAINING AND PROMOTION

The management personnel will be advertising through positive and newspaper. In
that the qualification and working experience will be shown in each form of
advertisement which in this case the posters and the newspapers

The selection personnel will be interviewed in the same line in order to know if he /
she has experience and component for becoming a successful in the field of salesman
or lady

13
In this case the business enterprise will have to organize training and also seminars so
that in increase the skill for the workers while in the running of the business enterprise
in that this will be organized once in a year and also visit a large grocery for some
skill.

Also, those workers who will satisfy the business manager after being competent
enough for their jobs and also performing their duties effectively will be promoted

Also, that worker who have maintained good public relation to customers and having
that the business enterprise will retain and attract more clients generating a lot of
profit will nr awarded and this will be done once every year

4.4 RENUMERATION AND INCENTIVES

Workers /employees personnel need to have Good reputation in order to perform their
task effectively. Due to this, VICTOR’S GROCERY shop will provide the following

 Salary increases will depend on the performance of the enterprise in that

workers salary will increase by 2% as the performance of the business
enterprise fair well
 Allowance will be provided to the workers such as medical allowance and
there will be pegged at ksh 2,000 for each employee.

When the business enterprise progressed well and make profit it expected to have or
to by a car in which it will be using in transporting products from one destination to
another while selling during the time when the customers are not many the time
workers but not all of them have a cup of tea in the nearby hotel/café and with their
own money being the business enterprise will not cater for that.

4.5 LICENSE PERMIT AND BY LAWS

This are things like trading license which the business enterprise will have to be
issued before the operation of the business start and this will be from the local
authority that must be satisfied with certain condition of the business enterprise before
issuing it.

The enterprise manager come up with the rules and regulations which in this case
includes the following

i. Should not smoke while in work (smoking is prohibited at work)

ii. All workers have their humble break time and this will be particularly when
customers are not so many and also should not be all workers at once
14
iii. All workers should observe time that opening hours will be at 8.00am in the
morning and closing hours will be at 6.00pm in the evening.
iv. And also, should ensure that all customers are being served as fast as possible
v. The business enterprise will not provide tea at or doing break time but instead
should have the same using their own money

4.6 SUPPORT SERVICE

The enterprise will have import from other successful business enterprises as
VICTOR’S grocery shop to give more advice on the running of the enterprise to run
and be a successful one then it will have to injure the business enterprise to the
national insurance company so that it will cater for theft or fire cases.

15
 CHAPTER FIVE
5.0 PRODUCTION AND OPERATION PLAN
The proposed business will lay down a comprehension strategy concerning the
production items as well as delivery of services to extreme customers.

The product and services will be unique and of high quality since the proprietor will
innovative and creative when producing or giving services

The production and operation objective which will guide the business in its operation
and production will include.

i. To acquire all basic facilities and equipment necessary for the provision of
high-quality production and services to customers
ii. To utilize creativity and innovation in the design of production and provision of
services on a continuous basis in order to be the customer first choice always

5.1. OPERATION FACILITIES AND EQUIPMENT

The business will require facilities and equipment set in place to facilitate and instill
good will to customers

5.1.1 Facilities

The proposed business will require 1/8 acres land in order to carry out production and
provide services well

The proprietor will base the premise of land for ksh 1,500 per year. Some of the
buildings will be built at that land to facilitated the daily run of the business

5.2 PRODUCTION AND OPERATION STRATEGY

The proposed business will lay a comprehensive strategy to production design in
modern technology. Modern technology is faster and not costing and it also helps the
proprietor to sell goods of high quality

5.2.1 PRODUCTION /SERVICES DESIGN AND DEVELOPMENT

The production will be designed under the name of the proposed business. The
proprietor will use television to advertise her goods through to slide showing all the
goods he sells for the production and services development.

16
The proprietor will also use round table to explain or show her customer what he is
selling in the business

5.2.2 Monthly labor requirement

The total cost of labor per month for Grocery shop furniture will be as follows

position number basic allowance Gross pay

Manager 1 12000 2000 14000
Supervisor 1 7000 1500 8500
Cashier 1 4500 500 5000
Watchmen 2 2500 500 6000
total 5 28500 5000 33500

5.2.3 Monthly production/ operation cost monthly

Operation expenses

Items cost

Business 2000

Licenses and permits 4500

Post office rental box 1500

Electricity 3000

Advertisement 2000

Equipment 2000

Sign post 40000

Telephone connection 2000

Insurance 2000

Stocks1000 miscellaneous 10000

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Totals 73000

Monthly production

Items cost

Totals cost of materials 5100

Totals operation expenses 73000

Totals labor requirement 33500

Totals 111600

5.2.4 Production/operation

All the production equipment will be among in a neat and in an attractive way to make
the place conducive for its operation the proprietor should ensure that the customers
are served in an orderly stress for service pricing of service will be pinned on the
premises in the way that in the will attract the customer manner and without much
stress for service pricing of services will be pinned on the premises in a way that it
will attract the customers fast before coming for the price list should be visible and
colorful payment will be made on the cashers desks customers will be gives services
the reception depending on his/ her services and then the payment will be paid to the
casher when the customer offer the receipt

The production process of VICTOR’S GROCERY will Include

I. Recovery

All the reception the customers will meet the receptionist who respective inquiries
about the services they as well as the directed to the respective personnel

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ii) Processing

At this stage all the customers’ needs are being processed that is collecting all the
requirements to make sure that he/she receiver interest he/she requires

iii) Packaging

This is the final process of the production the items are packed into the vehicles then
they transported to respective place

5.3 REGULATION AFFECTING OPERATION

All the regulation made in the business should be strict to ensure that the business is
running smoothly

i) Health regulation

High standard of hygiene will be ensured by keeping the environment clean at all the
time. This will be achieved by proper disposal of the litters and this will assist the
enterprise to meet the requirement of the public health

ii) Safety regulation

The proposed business will employ the qualified security to ensure good
protection between businesses. The proprietor also should ensure that she
has all business requirements like business permits and license
iii) Business name
The proposed business is registered under the name VICTOR’S GROCERY
SHOP because the business has not been registered by social services

Iv) Labor laws

The proposed business will be governed by the following laws

Regulation of wages and conditions of employment acts

The working will also be standardized to meet the requirement of the act Employees
acts recruited of employees will be done according to the rules and regulation of
employees acts

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 CHAPTER SIX
6.0 FINANCIAL PLAN
The financial plan determines the financial requirement of the business venture it also
provides proposal for sources and uses of funds.

6.1 PRE-OPERATIONAL COST

These are the initial expenses of VICTOR’S GROCERY will incur before the
operation or actual business begins the following tables shows the pre-operational cost
of VICTOR’S GROCERY.

Items Cost <ksh>

Advertisement 1000
License 4000
Water bill 500
Electricity 3000
Equipment’s 5200
Telephones 2000
Insurance 1000
Business registration 2000
totals 18700

6.2 WORKING CAPITAL

Items 2025 2026 2027
Current assets
Cash at hand 60000 70000 80000
Cash at bank 20000 20000 10000
Debtors 97000 260000 348450
Total currents 177000 350000 438450
assets
Current liabilities 21000 24000 114000
Creditors 85000 85000 50000

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Bank loan 106000 109000
Totals currents
Liabilities
Working capital 71000 241000 274450
Current asses-
current liabilities

21
PARTICULARS JAN FEB MAR APRIL MAY JUNE JULY AUGUST SEP OCT NOV DEC
Cash flows
Begging cost 175000 119500 67000 7500 10500 116500 112000 110000 89500 96500 915000 93500
Sales 30000 35000 70000 90000 80000 60000 50000 40000 60000 55000 55000 40500
Debtors 5000 10000 150000 5000 10000 2000 10000 5000 10000 5000 10000 10000
Total cash 210000 164500 152000 166500 19500 78500 172000 15500 159500 156500 156000 14400
inflows
Cash outflow 2000 33500 2000 1000
Advertisement 40000 30000 20000 10000 20000 10000 5000 6000 7000 10000 8000 9000
Wages and 4000 4000 4000 4000 4000 4000 4000 4000 4000 4000 4000 4000
salaries
Creditors 5000 5000 5000 5000 5000 5000 5000 5000 5000 5000 5000 5000
Purchase 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000
Rent 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000
Loan repayment 90500 90500 90500 90500 90500 90500 90500 90500 90500 90500 90500 90500
Loan interest 119500 67000 71500 101500 116500 112000 110000 89500 96500 915000 93500 80000

22
PARTICULARS JAN FEB MAR APRIL MAY JUNE JULY AUGUST SEP OCT NOV DEC TOTAL
Cash flows 50000
Cost sales 30000 80000 100000 50000 80000 90500 85500 60000 70000 75000 50000 40000 311000
Debtors 20000 30000 15000 20000 15000 20000 25000 20000 25000 20000 30000 2000 26000
Total cash inflows
Cash outflow
Advertisement 2000 1000 2000 5000
Wages and salaries 35000 35000 35000 35000 35000 35000 35000 35000 35000 35000 35000 35000 42000
Creditors 2000 4000 8000 1000 24000
Purchase 30000 35000 2000 15000 10000 20000 20000 30000 40000 35000 20000 10000 26700
Rent 4000 4000 4000 4000 4000 4000 4000 4000 4000 4000 4000 4000 48000
Loan repayment 5500 5500 5500 5500 5500 5500 5500 5500 5500 5500 5500 5500 66000
Loan interest 22000 2200 2200 22000 2200 2200 22000 2200 2200 22000 2200 2200 26400
Electricity 500 600 550 700 900 800 500 700 700 500 900 1000 83350
Total out follow 79200 84300 99250 62400 62600 75500 67200 77400 87700 94200 67600 57700 86414750
Net pay 50800 76500 14250 149850 18250 217250 260550 263150 2700750 271550 283950 286250 2455100

23
6.5. PROJECTED PROFOMA BALANCE SHEET FOR PEJEBI SHOP FOR THE
YEAR ENDED 2025, 2026 AND 2027

Particulars 2016 2017 2018

Fixed Asset
Equipment 5100 6000 7000
Rent 48000 48000 48000
Total fixed asset 53100 54000 55000

6.6. BREAKEVEN ANALYSIS FOR PEJEBI GROCERY SHOP FOR THE YEAR
2025, 2026 AND 2027
Fixed cost expenses for year 2025; 2026 and 2027

Particulars 2025 2026 2027

Rents 48000 48000 48000
Wages/salary 402000 420000 48000
Loan repayment 60000 66000 42000
Loan interest 24000 26400 18000

Totals 534000 560400 588000

Variable cost for year 2025, 2026 and 2027

Particulars 2025 2026 2027

Electricity 11500 8350 13400
Advertisement 6000 5000 9100
Maintenance 10000 5000 7000
Totals 27500 18350 31500

Circulation of breakeven point

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Formula 2025 2026 2027
B.E. P=fixed cost 53400 560400 588000
1- variable sales 1-27500 1-18350 1-315000
65500 811000 865000
1-27500 1-18350 1-31500
665000 811000 865000
1-0.0412 1-0.0226 1-0.0364
=0.9385 =0.9774 =9636
534000 564000 588000
0.09588 0.9774 0.9636
=ksh556946.18 Ksh57337.9 Ksh1021.71

6.7 PROFITABILITY RATIO FOR PEJEBI SHOP FOR THE YEAR 2025, 2026
AND 2027
Type of ratio Working 2025 2026 2027
formula
Gross profit Gross profit 49000X100 49000X100 1087000X100
purchase X100 665000 665000 865000
Profitability Sales 7.368% 7.368% 125.66%
ratio
9500X100 54670X100 505305X100
Net profit 66500 81100 865000
after tax X100 =1.43% =67.39% 58.42%

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CONTRIBUTION MARGIN AND PERCENTAGE FOR PEJEBI FOR THE
YEAR 2025,2026 AND 2027

Formula 2025 2026 2027

Contribution
margin Totals sale- 665000-27500 811000-18350 865000-
variable cost =637500 =72650 315000
8335000

Percentage Confirmation 637500X100 72650X100 8333500X100

marginX100 665000 811000 865000
sales
=5.86% 97.74% 6.36%

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6.8 DESIRED FINANCING
ITEMS Amount
Pre-operational cost 18700
Fixed cost 534000
Working capital 71000
Totals 623700

6.9 PROPOSED CAPITALIZATION

items Amount
Owner contribution 20000
Family and friends 50000
Bank loan 100000
Totals 170000

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