BUSINESS PLAN WHOLESELATRED IN AGRICULTER PRODUCTS JUNE 2024

BUSINESS PLAN
ON
WHOLESELATRED IN AGRICULTER PRODUCTS

LOAN REQUEST

PROMOTER: Hidego Ferede Golla

BUSINESS LOCATION: Amhara zone Gonder worded Jantenk

FOR SINKE BANK

Ff of Ethiopia

JUNE, 2024

ADDIS ABABA

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BUSINESS PLAN WHOLESELATRED IN AGRICULTER PRODUCTS JUNE 20244

Table of Contents
Executive Summary.........................................................................................................................1
1 Introduction:.........................................................................................................................................2
2 Market Analysis for Hidego Ferede:..................................................................................................4
3 SWOT Analysis and Evaluation:.......................................................................................................6
4 Marketing and Sales Strategy.............................................................................................................8
4.1 Sales Forecast 10
4.1.1 List of Customers and Suppliers 11

1.1. Utilities Expenses…………………………………………………………………………13

Projected Income Statement ……………………………………………………….. 15

4.3 Balance sheet ………………………………………………………. …….14

4.3 Assumption 12
5 Cash in flow:.......................................................................................................................................19
6 Cash outflow.....................................................................................................................................20
1.1Human Resource Requirement of the Business…………………………………………………………………………………22

1.1.1. Risk Assessment and Disaster Management Plan…………………………...........23

1.2. Conclusion and Recommendation……………………………………….. …………………..24

Table 1.Balance Sheet Statement of Hidego Ferede for the last Three years................................17
Table 2. Profit and Loss Statement of Hidego Ferede for the last Three years 18
BUSINESS PLAN WHOLESELATRED IN AGRICULTER PRODUCTS JUNE 2024

Executive Summary
Hidego Ferede Golla is a well-established and growing company in Ethiopia, operating in the
wholesale trade and distribution sector. The company specializes in the wholesale of various
consumer goods and has successfully built a strong reputation for delivering high-quality
products to customers across the country.
This proposal seeks a loan from Commercial Bank of Ethiopia to support the expansion plans of
Hidego Ferede Golla. The loan amount requested is ETB 4.9 million, which would primarily be
utilized for expanding our product range and distribution network, as well as investing in
marketing and promotional activities.
The expansion project aims to address the growing demand for diversified consumer goods in the
market and capitalize on the company's strong brand recognition. The additional funds will
enable us to introduce new product lines and diversify our offerings, giving us a competitive
edge in the market. This expansion will also create employment opportunities and contribute to
the economic growth of the region.
Moreover, we have a dedicated management team with a proven ability to execute business
strategies and deliver results. The funds from the loan will be managed efficiently and used in a
cost-effective manner to ensure maximum return on investment.

Hidego Ferede Golla has a solid foundation, robust financials, and a clear vision for growth. We
have a strong relationship with Sinke Bank, and their support in the form of a loan will enable us
to implement our expansion plans effectively. We are confident that this expansion project will
not only enhance the company's performance but also contribute to the overall development of
the economy.

1 In conclusion, we request Sinke Bank to consider our loan proposal and support us in
our expansion plans. The loan funds will be utilized wisely to expand our product
range, strengthen our distribution network, and invest in marketing activities. With
the bank's support, Hidego Introduction:
1.1.1.1 Hidego Ferede Golla is a dynamic and reputable company operating in Ethiopia's
distribution sector. With a diverse range of products, including fast-moving consumer
goods, Ensete ,Vegetable oils, Pulses, Sorghum, millet, and corn Grains
and many others, Hidego Ferede Golla has established itself as a trusted partner for
multinational firms, manufacturers, logistics providers, and equipment manufacturers.

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BUSINESS PLAN WHOLESELATRED IN AGRICULTER PRODUCTS JUNE 20244

Over the past decade, Hidego Ferede Golla has successfully navigated the complexities of the
importation process and built strong relationships with suppliers, enabling us to offer the best
delivery options based on our clients' specific requirements. Our commitment to excellence and
professionalism has earned us a solid reputation in the industry.

In addition to our expertise in the import and distribution of various products, we have also
ventured into the construction sector, supplying high-tech equipment to meet the evolving needs
of the industry. Our experience in this sector further strengthens our ability to provide innovative
solutions for diverse project requirements.

Hidego Ferede Golla extensive distribution network includes partnerships with reputable vendors
such as Farmer Trading and ECX. Through these partnerships, we have established a
comprehensive presence in the market, with 15 outlets in the west and 11 outlets in the south
parts of Ethiopia. This widespread coverage enables us to reach a large customer base and
efficiently meet their demands.

To fuel our expansion and continue providing exceptional service to our clients, Hidego Ferede
Golla is seeking a loan from the esteemed Commercial Bank of Ethiopia. We are confident that
with the bank's support, we can further enhance our operations, expand our product range, and
strengthen our position as a leading player in the import and distribution industry.

We are excited about the opportunity to partner with Sinke Bank and believe that our track
record of success, commitment to quality, and passion for meeting customer needs make us an
ideal candidate for this loan. Together, we can drive growth, create employment opportunities,
and contribute to Ethiopia's economic development.

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BUSINESS PLAN WHOLESELATRED IN AGRICULTER PRODUCTS JUNE 20244

Objective

The objective of the 4.9 million expansion loan is to support Hidego Ferede Golla ambitious business expansion
plans and drive growth in the import and distribution sector. The loan will be utilized to achieve the following
key objectives:

1. Expansion of product range: With the loan, Hidego Ferede Golla will seek to diversify its product range by
adding new fast-moving consumer goods, raw materials, technical tools, household and commercial equipment,
and other innovative products. This expansion will enable us to cater to a wider customer base and increase our
revenue streams.

2. Increase distribution network: A portion of the loan will be allocated towards expanding our distribution
network, both within Ethiopia and in neighboring countries. By establishing new outlets and strategic
partnerships, we aim to enhance our market reach and improve our ability to serve customers efficiently.

3. Modernization of logistics and infrastructure: A significant portion of the loan will be invested in upgrading
our logistics and infrastructure capabilities. This includes enhancing our warehousing facilities, improving
transportation systems, and implementing state-of-the-art inventory management software. These improvements
will allow us to streamline operations, reduce costs, and enhance overall efficiency.

4. Strengthening partnerships: Hidego Ferede Golla will utilize the loan to establish stronger partnerships with
multinational firms, manufacturers, logistics providers, and equipment manufacturers. By leveraging these
relationships, we can negotiate favorable terms, access high-quality products, and provide enhanced value to our
customers.

5. Job creation and economic growth: The expansion plans enabled by the loan will generate significant
employment opportunities, both directly and indirectly. By expanding our operations and establishing new
distribution outlets, we will create employment opportunities for individuals across various sectors, thereby
contributing to local economic growth.

The expected outcomes of this expansion loan include increased market share, improved profitability, enhanced
customer satisfaction, and a stronger competitive position in the import and distribution sector. Hidego Ferede
Golla is confident in achieving these objectives and looks forward to the positive impact our expansion will
have on our company, employees, partners, and the overall economy.

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BUSINESS PLAN WHOLESELATRED IN AGRICULTER PRODUCTS JUNE 20244

2 Market Analysis for Hidego ferede:

The target market for Hidego Ferede Golla consists of the import and distribution sector in Ethiopia, specifically
focusing on the west and south parts of the country. Here is a detailed analysis of this market, including key
numbers and trends:

1. Market Size:
- The import and distribution sector in Ethiopia has experienced significant growth in recent years, driven by
increased consumer purchasing power and growing demand for a wide range of products.
- According to recent data, the overall market size for imported consumer goods, raw materials, technical
tools, household and commercial equipment, and other products stands at approximately 16.6billion.

2. Growth Potential:
- The market shows immense growth potential due to factors such as population growth, urbanization, and
rising disposable incomes in Ethiopia.

- The GDP growth rate of Ethiopia has been averaging 7.6% over the last decade, indicating a vibrant and
expanding economy.

- The government's focus on industrialization and infrastructure development presents further opportunities
for market expansion.

3. Competition:

- The import and distribution sector in Ethiopia is highly competitive, with both local and international players
vying for market share.

- Key competitors include other import and distribution firms, regional wholesalers, and direct suppliers to
retailers.

- However, Hidego Ferede Golla has successfully established itself as a reputable player in the market with a
solid reputation, extensive distribution network, and partnerships with leading vendors such as Farmer and ECX
Ethiopia.

4. Trends:

- There are several key trends shaping the import and distribution sector in Ethiopia:

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BUSINESS PLAN WHOLESELATRED IN AGRICULTER PRODUCTS JUNE 20244

- Increasing consumer preference for branded products and international brands.

- Growing demand for high-quality household and commercial equipment as urbanization and construction
projects continue to rise.

- Rising popularity of e-commerce and online purchasing, driving the need for efficient delivery options and
innovative logistics solutions.

- Shifting consumer preferences towards sustainable and eco-friendly products.

- Additionally, the COVID-19 pandemic has brought about new trends and challenges, such as increased
demand for certain consumer goods, changes in supply chain dynamics, and a shift towards digitalization.

- Hidego Ferede Golla acknowledges these trends and is committed to adapting its strategies to stay ahead in
the market and meet the evolving needs of its customers.

In conclusion, the import and distribution sector in Ethiopia presents a large and growing market for Hidego
Ferede Golla With a strong track record, partnerships with key vendors, and an understanding of market trends,
Hidego Ferede Golla well-positioned to capitalize on the immense opportunities and achieve further success in
the industry.

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BUSINESS PLAN WHOLESELATRED IN AGRICULTER PRODUCTS JUNE 20244

3 SWOT Analysis and Evaluation:

A - Strengths:

1. Skill and Profession: Hidego Ferede Golla has professionals with extensive experience and wide
exposure in door-to-door distribution of FMCG (Fast-Moving Consumer Goods). This expertise ensures
efficiency and effectiveness in delivering products to customers.

2. Strong business relationship: Hidego Ferede Golla focuses on building long-term business
partnerships with clients. This strength helps in establishing trust, understanding customer requirements,
and creating loyalty among clients.

3. Interpersonal relationship: Hidego Ferede Golla prioritizes interpersonal relationships with clients.
This strength facilitates better communication, understanding of customer needs, and personalized
services.

4. Reliability: Hidego Ferede Golla is known for its reliability in delivering products and services. This
strength enhances customer satisfaction, trust, and loyalty.

5. Assured quality: Hidego Ferede Golla maintains a high standard of quality in its services and
products. This strength helps in meeting customer expectations and retaining clients.

6. Target-oriented services: Hidego Ferede Golla aligns its services with customer targets. This strength
ensures the delivery of desired outcomes and enhances customer satisfaction.

W - Weaknesses:

1. Limited resources: Hidego Ferede may face challenges due to limited resources. This weakness could
potentially affect scalability and the ability to cater to a larger customer base.

2. Dependence on technology: Hidego Ferede heavily relies on technology, such as GPS and sales
tracking systems. This weakness could lead to disruptions in operations if there are technical issues or
system failures.

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BUSINESS PLAN WHOLESELATRED IN AGRICULTER PRODUCTS JUNE 20244

3. Lack of diversification: Hidego Ferede focus on door-to-door distribution of FMCG may limit
opportunities for expansion into different sectors or markets. This weakness may restrict potential
growth and revenue streams.

O - Opportunities:

1. Growing FMCG market: The FMCG market is expanding globally. Hidego Ferede can leverage this
opportunity to capture a larger market share and increase revenue.

2. Demand for efficient distribution: With increasing competition and customer expectations, there is a
demand for efficient distribution services. Hidego Ferede can capitalize on this opportunity by providing
superior and reliable door-to-door distribution.

3. Collaborations with FMCG companies: Hidego Ferede can explore partnerships or collaborations with
FMCG companies to strengthen its presence in the market. This opportunity can lead to new business
opportunities and increased brand value.

T - Threats:

1. Intense competition: The door-to-door distribution sector is highly competitive, with numerous
companies offering similar services. Hidego Ferede may face threats from existing competitors and new
entrants.

2. Technological advancements: The advancement of technology can potentially disrupt the traditional
door-to-door distribution model. Hidego Ferede needs to stay up dated and adapt to new technologies to
remain competitive.

3. Changing consumer preferences: Consumer preferences and buying behavior may change over time.
Hidego Ferede needs to continuously monitor and adapt its offerings to meet evolving customer needs.

4. Economic uncertainties: Economic factors, such as recessions or inflation, can impact consumer
spending and demand for FMCG. Hidego Ferede needs to be prepared for potential economic downturns
and minimize associated risks.

In conclusion, Hidego Ferede has several strengths, such as its skilled professionals, strong business
relationships, and utilization of technology.

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BUSINESS PLAN WHOLESELATRED IN AGRICULTER PRODUCTS JUNE 20244

However, it also faces weaknesses, such as limited resources and dependence on

technology.

By capitalizing on opportunities like the growing FMCG market and efficient distribution demand, and
effectively addressing threats such as intense competition and changing consumer preferences, Hidego Ferede
can enhance its competitive position and achieve sustainable growth.

4 Marketing and Sales Strategy

1. Target Market Analysis:
Conduct thorough market research to identify the target audience for Hidego Ferede products. Analyze
demographics, preferences, and purchasing behavior to create customer profiles.

2. Unique Selling Proposition:

Clearly define Hidego Ferede unique selling proposition (USP) that sets it apart from competitors. Highlight
the key features, benefits, or values that make Hidego Ferede products superior.

3. Branding and Positioning:

Develop a strong brand identity and positioning strategy that resonates with the target market. Design a
compelling brand image, logo, and tagline that communicate Hidego Ferede value proposition effectively.

4. Marketing Campaigns:

Create integrated marketing campaigns across various channels to maximize reach and engagement. Examples
of marketing tactics include:

a) Digital Marketing: Leverage social media, search engine optimization (SEO), pay-per-click (PPC)
advertising, email marketing, and content marketing to boost brand awareness and drive traffic to Hidego
Ferede website.

b) Traditional Advertising: Utilize print media, radio, television, and outdoor advertisements to reach a wider
audience.

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BUSINESS PLAN WHOLESELATRED IN AGRICULTER PRODUCTS JUNE 20244

c) Influencer Marketing: Collaborate with influencers and industry experts to endorse Hidego Ferede products
and increase brand credibility.

d) Event Sponsorships: Sponsor relevant trade shows, conferences, or community events to raise brand
visibility.

5. Sales Techniques:

Train the sales team to effectively communicate value, handle objections, and close deals. Implement the
following sales techniques:

a) Relationship Building: Foster strong relationships with customers using personalized interactions, follow-
ups, and exceptional customer service.

b) Consultative Selling: Understand the customer's needs and provide tailored solutions that align with their
requirements.

c) Up selling and Cross-selling: Identify opportunities to up sell or cross-sell products based on customer
preferences and purchase history.

6. Customer Acquisition:

Implement strategies to attract new customers to Hidego Ferede:

a) Referral Program: Encourage existing customers to refer their contacts by offering incentives or discounts.

b) Lead Generation: Utilize lead generation techniques such as gated content, newsletters, and webinars to
capture potential customer information.

c) Strategic Partnerships: Collaborate with complementary businesses or industry influencers to expand the
customer base.

7. Customer Retention:

Focus on retaining existing customers and fostering long-term relationships:

a) Loyalty Program: Implement a rewards program that incentivizes repeat purchases and offers exclusive
perks to loyal customers.

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BUSINESS PLAN WHOLESELATRED IN AGRICULTER PRODUCTS JUNE 20244

b) Personalized Communication: Regularly engage with customers through personalized emails, newsletters,
or SMS marketing to nurture the relationship.

c) Customer Feedback & Support: Set up a mechanism for gathering customer feedback and promptly
addressing any concerns or issues.

8. Performance Tracking and Analysis:

Continuously monitor and analyze marketing and sales data to assess the effectiveness of different strategies.
Make data-driven decisions and optimize campaigns accordingly.

4.1 Sales Forecast

Hidego Ferede is forecasting strong sales growth over the next fiscal year. The following forecast is based on a
combination of historical sales data, market research, and industry trends.

Assumptions:

1. Market Demand: The forecast assumes that there will be a stable and growing demand for beverages in the
market. The company has conducted extensive market research and analyzed consumer trends to anticipate
future demand patterns.

2. Brand Partnerships: Hidego Ferede has established solid and mutually beneficial partnerships with renowned
beverage brands farmer & ECX. The forecast assumes that these partnerships will continue to generate
consistent sales and contribute to the company's growth.

3. Product Mix: The sales forecast considers the current product portfolio and assumes that there will be a
steady demand for the existing product range. The forecast also factors in the introduction of new beverages
based on market demand and emerging trends.

4. Promotion and Marketing: Hidego Ferede plans to increase its marketing efforts to create brand awareness
and drive sales. The forecast assumes that these promotional activities will effectively attract new customers and
stimulate repeat purchases.

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BUSINESS PLAN WHOLESELATRED IN AGRICULTER PRODUCTS JUNE 20244

1.3. Loan Disbursement and repayment schedule

Loan requested term loan and overdraft

Term loan 5,000,000.00
. Operating Cash Flows:

- Utilize a portion of the company's operating cash flows generated from sales and business operations to
cover the loan installments and interest payments. These cash flows will be allocated based on the proposed
repayment schedule mentioned above.

2. Cost Reduction Initiatives:

- Implement cost reduction measures, such as optimizing supply chain management, renegotiating vendor
contracts, and streamlining internal processes, to enhance profitability and generate additional funds for debt
repayment.

3. Increase in Sales and Revenue:

- Develop and execute sales growth strategies to increase Hidego Ferede Golla
market share and capture a larger customer base. This could include expanding
product lines, entering new markets, or launching targeted marketing campaigns to
drive sales and boost revenue. The increased revenue will contribute to covering the
loan and interest payments
Principal Interest
Pym. No. Disbursement Total Repayment Ending Balance
Repayment Payment
4,900,000.00

1 326,105.65 196,000.00 522,105.65 4,573894.35

2 339,149.87 182,955.77 522,105.65 4,234,744.48

3 352,715.87 169,389.78 522,105.65 3,882028.61

4 366,824.5 155,281.14 522,105.65 3,515,204.11

5 381,497.48 140,608.16 522,105.65 3,133,706.63
6 396,757.38 125,348.27 522,105.65 2,736,949.25
7 412,627.68 109,477.97 522,105.65 2,324,321,57
8 429,132.78 92,972.86 522,105.65 1,895,188.76
9 446,298.09 75,807.55 522,105.65 1,448,890.70
10 464,298.02 57,955.63 522,105.65 984,740.68

11 482,716.02 39,389.63 502,024.66 502,024.66

12 481,943.67 20,080.99 502,024.66
BUSINESS PLAN WHOLESELATRED IN AGRICULTER PRODUCTS JUNE 20244

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Identified Income Sources to Cover Loan and Interest Payments:

1. Operating Cash Flows:

- Utilize a portion of the company's operating cash flows generated from sales and business operations to
cover the loan installments and interest payments. These cash flows will be allocated based on the proposed
repayment schedule mentioned above.

2. Cost Reduction Initiatives:

- Implement cost reduction measures, such as optimizing supply chain management, renegotiating vendor
contracts, and streamlining internal processes, to enhance profitability and generate additional funds for debt
repayment
Distribution Network: The Company’s distribution network has been expanding steadily, reaching more
retailers and businesses across different geographic regions. The sales forecast assumes continued growth in the
distribution network, resulting in increased sales opportunities.

Competitive Landscape: The sales forecast accounts for the competition within the beverage distribution
industry. Hidego Ferede has analyzed the market share of key competitors and anticipates capturing a larger
market share through superior service, product quality, and strong relationships with customers.

Customer Relations: Hidego Ferede places a strong emphasis on building and maintaining excellent customer
relationships. The forecast assumes a high customer retention rate and expansion of the customer base through
referrals and positive word-of-mouth.

Using these assumptions, Hidego Ferede has projected a sales growth rate of 10% for the next fiscal year. It is
important to note that these projections are subject to market conditions, unforeseen events, and changes in
customer preferences. Hidego Ferede will continually monitor and adjust its sales strategies to maximize growth
potential and achieve its sales forecast.

4.1.1 List of Customers and Suppliers

Hidego Ferede has Many Potential Customers which is sub-Agent, Retailer and Sellers and also there are many
Partners who have Business link with our company that are strategically alliances throughout the Year.
BUSINESS PLAN WHOLESELATRED IN AGRICULTER PRODUCTS JUNE 20244

Currently there are almost above one Hundred Customers Mainly Retailers. As we above mentioned above the
our Potential Suppliers is ECX and Farmer.

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1.4. Utilities Expenses

Unit of
No Description Quantity Unit Cost Total Cost
Measurement
1 Fuel Liters 1,000.00 77.65 17,650.00
2 Electricity kWh 19,600.00
3 Water 12,000.00
Internet , website and
4 Telephone 8,000.00
Total 57,250

Other Expenses

No Item Total Cost

1 Supply Expenses 5,000.00
2 Repair and maintenances Expenses 5,000.00
3 Insurance Expenses 8,000.00
4 Loading and Unloading Expenses 10,000.00
5 Commission Expense 5,000.00
6 Staff Transportation Expenses 10,000.00
7 Provision of Contingencies 10,000.00
Total Operating Cost 53,000.00

1.5. Depreciation Expense

To determine the periodical depreciation, the consultant adopted useful life of fixed assets according to
Ethiopian standard and hence used depreciation rates for each asset category accordingly. The periodical
depreciation charge is estimated to be Br.14,500.00

S. No Item Unit Estimated cost Depreciation Rate Depreciation Cost

1 Building 1 5,500,000.00 0.05 2,750.00
2 Equipment and Furniture 1 47,000.00 0.25 11,750
Total 5,547,000.00 14,500.00
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5.3.1. Purchase plan

. Projected Purchase Plan in Birr
For the Period of Five Year's

S
/ Projected Quantities Purchased
N Mea Base
o ; s Year Yr-1 Yr-2 Yr-3 Yr-4

Maize(corn) 1,650,000.00
I Kg 1,250,000 1,400,00.00 1,500,00.00
Rice
2 Kg 950,000.00 1,250,000.00 1,500,000.00 1,650,000.00
Wheat
3 kg 550,000.00 800,000.00 1,000,000.00 1,250,000.00
soybeans
4 kg 650,000.00 850,000.00 1,100,000.00 1,300,000.00

5 cassava Kg 650,000.00 1,000,000 1,500,000.00 1,500,000.00

coffee tables
6 kg 550,000.00 450,000.00 550,000.00 650,000.00

7 Vegetables kg 650,000.00 650,000.00 550,000.00 550,000.00

8 coconut kg 750,000.00 1,000,000.00 1,100,000,00 1,350,000.00

9 cotton kg 680,000.00 1,100,000.00 1,350,000.00 1,500,000.00

1
0 tobacco kg 550,000.00 750,000.00 750,000.00 900,000.00
1
1 milk kg 950,000.00 1,100,000.00 1,300,000.00 1,450,000.00
8,180,000 8,950,000.00
9,600,000.00 13,750,000.00
9 total

II. projected purchase in Amount (in Birr)

BUSINESS PLAN WHOLESELATRED IN AGRICULTER PRODUCTS JUNE 20244

pri
Projected Purchased in Birr
ce
in
S/ bir
No ; r Yr-1 Yr-2 Yr-3 Yr-4

Maize(corn) 1,450,000 1,650,000 1,800,000 1,950,000.00

I
Projected
Rice 1,150,000 1,500,000.00 1,300,000.00 2,000,000.00
2 Income
Wheat 750,000 1,050,000.00 1,300,000.00 1,600,000.00 Statement
3
soybeans 850,000 1,100,000.00 1,400,000.00 1,650,000.00 The project
4

850,000 1,250,000.00 1,800,000.00 1,850,000.00 asset is

5 cassava
estimated to be
coffee tables 750,000 700,000.00 850,000.00 1,500,000.00
6 birr
850,000 900,000.00 850,000.00 1,400,000.00 4,900,000.00
7 Vegetables
950,000 1,250,000.00 1,400,000.00 1,700,000.00 the new loan
8 coconut
880,000 1,350,000.00 1,650,000.00 1,850,000.00 requested is an
8 cotton
750,000 1,000,000.00 1,050,000.00 1,250,000.00 (its revolving
9 tobacco
1,150,000 1,350,000.00 1,600,000.00 1,800,000.00 and purchase of
milk
10,380,000 13,100,000.00 15,000,000.00 20,100,000.00
input to be
TOATAL
released each
year and paid at the end of each year) and the total equity is birr 1,225,000.00. The detail is summarized in the
table below.

Description 2024 2025 2026 2027

Sales Revenue 10,380,000 13,100,000.00

15,000,000.00 20,100,000.00

Total Sales 10,380,000 13,100,000.00 15,000,000.00 20,100,000.00

Less: Cost Of product 8,180,000 8,950,000.00 9,600,000.00 13,750,000.00

Gross Profit 2,200,000.00 4,150,000.00 5,400,000.00 6,350,000.00

Less Operating
Expense
Salary Expense 450,040.00 557,408.00 698,506.00 898,550.00
Utility Expense 57,250.00 67,250.00 80,150.00 88,550.00
BUSINESS PLAN WHOLESELATRED IN AGRICULTER PRODUCTS JUNE 20244

Supply Expense 5,000.00 9,000.00 10,250.00

7,000.00
Repair and 6000.00 7,250.00
Maintenance Expense 5,000.00
55,000.00
Insurance Expense 8,000.00 8,000.00 9,500.00
8,000.00
Loading and 50,000 85,500.00
Uploading Expense 10,000.00
20,000.00
Staff Transportation 80,000.00 202,000.00
Expense 10,000.00
30,000.00
Provision of 50,000.00, 50,000.00
Contingencies 10,000.00
30,000.00
Interest Expense 39,302.91 39,302.19 39,302.19
39,302.19
Depreciation Expense
Total Operating 594,592.91 760,960.19 1,215,808.19 1,390,852.19
Expense
Net Income Before 3,389,039.81 4,184,191.81 4,959,147.81
Tax 2,605,407.09

Less Tax 240,811.06 508,355.97 627,628.77 743,872.1715

Net Income After 2,364,596.03 2,880,683.84 3,556,563.03 4,371,083.00

Tax
BUSINESS PLAN WHOLESELATRED IN AGRICULTER PRODUCTS JUNE 20244

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Cost breakdown

No Description Cost
1 Fixed Investment
1.1 Land, Building and Construction 0.00
1.2 Machines and Equipment’s 0 0.00
1.3 Vehicles and Motors 0 0.00
1.4 Office Furniture and Equipment 0.00
Total Fixed Investment Cost 0.00
2 Operating Expense 0.00
2.1 Raw Materials Purchase and Products 12,000,000 0.00
2.2 Salary Expense 3,168,000 0.00
2.3 Other Operating Expense 0.00
400,000.00
2.4 Pre-operating Expense 600,000.00 0.00
Total Operating Expense 13,003,168.00 0.00
1,300,316.8
Contingency (Lump sum) 10%
Total Investment Cost 14,303,484.8 0.00
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Note: - The Detail is Summarized on the Table which Expressed Three Years Profit and Loss Statement.

• Balance sheet
Balance Sheet
Asset
Current Asset
Cash 500,000.00
Inventory of raw materials and inputs 47,000.00
Total Current Asset 547,000.00
Fixed Asset
Land, Building and Construction 5,500,000.00
Machineries and Equipment’s 0
Office Equipment 47,000.00
Vehicles 0
Total fixed Asset 5,547,000.00
Total Asset
Liability
Account payable 500,000.00
Owners’ Equity 1,250,000.00
Capital
Total Liability & Owners’ Equity 1,750,000.00
BUSINESS PLAN WHOLESELATRED IN AGRICULTER PRODUCTS JUNE 20244

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BUSINESS PLAN WHOLESELATRED IN AGRICULTER PRODUCTS JUNE 20244

Cash flow

Cash Flow
Statement

Particulars Year0 Year 1 Year 2 Year 3-4

A. Cash Inflow 0
· Own equity 1,250,000.0
0
· Bank loan 4,900,000.00
· Net profit 0 2,364,593.03 3,880,683.84 8,771,838.67

Total inflow 2,364,593.03 3,880,683.84 8,771,838.67

6,250,000.00

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BUSINESS PLAN WHOLESELATRED IN AGRICULTER PRODUCTS JUNE 20244

B. Cash outflow 0
· Fixed capital 3,325,000.00
· Working capital 2,300,000.00
. Contingency (Lump 625,000.00
sum) 10%
· Loan repayment 1,471,635.00 1,471,635.00 4,400,755.67

Total outflow 6,250,000.00 1,471,635.00 1,471,635.00 4,400,755.67

Net inflow (A-B) 1,364,593.03 2,409,048.84 4,371,083.00

0
Cumulative balance 1,364,593.030 2,409,048.84 4,371,083.00
0
Table 1. Profit and Loss Statement of Hidego Ferede Golla for the last Three years
4. Loan Utilization:

- Utilize 4,900,000.00 million of the loan to expand the existing inventory and cater to increased customer
demand.

Identified Income Sources to Cover Loan and Interest Payments:

1. Operating Cash Flows:

- Utilize a portion of the company's operating cash flows generated from sales and business operations to
cover the loan installments and interest payments. These cash flows will be allocated based on the proposed
repayment schedule mentioned above.

2. Cost Reduction Initiatives:

- Implement cost reduction measures, such as optimizing supply chain management, renegotiating vendor
contracts, and streamlining internal processes, to enhance profitability and generate additional funds for debt
repayment

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3. Increase in Sales and Revenue:

- Develop and execute sales growth strategies to increase Hidego Ferede market share and
capture a larger customer base. This could include expanding product lines, entering new
markets, or launching targeted marketing campaigns to drive sales and boost revenue. The
increased revenue will contribute to covering the loan and interest payments.

4. Profit Reinvestment:

- Allocate a portion of the company's profits towards repaying the loan, while ensuring a
balance in reinvesting funds for business growth and expansion. This approach will help generate
additional profits in the long term, contributing to the repayment process.

5. Cash Reserves: Utilize existing cash reserves or set aside a contingency fund specifically for
loan repayments. This ensures a dedicated source of funds to cover any unforeseen
circumstances or temporary cash flow fluctuations without defaulting on the loan.

It is essential to regularly monitor and evaluate the financial performance of Hidego Ferede
Golla, track progress towards repayment goals, and makes any necessary adjustments to the plan
as circumstances change. Communication and coordination with lenders should be maintained to
ensure transparency and adherence to agreed-upon terms.

1.6. 6. Organization, Management, Human Resource Requirement and Availability

1.6.1. Business Form

Nejat Ahmed, import household office appliances & furnishing is established in the
form of sole proprietorship by an Entrepreneur, and will be headed by a professional Manager.
The structure of the organization is designed as follows.

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BUSINESS PLAN WHOLESELATRED IN AGRICULTER PRODUCTS JUNE 20244

1.6.2. Organizational Structure

1.7. Human Resource Requirement of the Business

Multi business trading like Nejat Ahmed, import household office appliances &
furnishing is a labor intensive industry; therefore, a total of 7 employees will be hired
including the current employees to handle the overall operation.

The average yearly increment of the salary for the employees is assumed at 10% for the next 5
years by considering changes in the external and internal environment. In line with the
requirements of the private organization’s social security organization, the pension scheme will
be installed and the contribution from the organization is considered to be 11% of the salary and
businesses to increase in proportion to the annual salary increment. Other employee benefits and
unforeseeable costs are considered in the 10% contingency. Other employee benefits are also
assumed at 2% of the total salary expenses. Accordingly, the following table shows the existing
and future workers’ requirement with qualifications and the first year’s monthly and annual
salary levels and associated costs.

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BUSINESS PLAN WHOLESELATRED IN AGRICULTER PRODUCTS JUNE 20244

N N Monthly Gross Annual Gross

Position Qualifications
o O Salary/Employee salary
BA & above in Business
10,000 120,000.0
1 General Manager Management, or related 1
fields; Experienced .00 0
BA in Accounting or 8,500.00 102,000.0
2 Import Coordinator 1
related field 0
3
Diploma in Purchasing 6,000 72,000.0
6 Purchaser 1
and Above .00 0
Diploma (10+4) in the 2000. 24,000.0
7 Secretary & Cashier 1
field 00 0
BA in Accounting or 5,000
8 Accountant 1 60,000.00
related field .00
1
1
1 24,000.0
2
Guards 6th complete 2 2,000.00 0
Sub-total 9 402,000. 00
Pension Contribution (11%) 44,220
Other Benefits (1%) 4,020.00
Total Human Resource Cost - Salary Expense 9 450,040.00
.

3. Increase in Sales and Revenue:

- Develop and execute sales growth strategies to increase ABRON's market share and capture a
larger customer base. This could include expanding product lines, entering new markets, or
launching targeted marketing campaigns to drive sales and boost revenue. The increased revenue
will contribute to covering the loan and interest payments.

4. Profit Reinvestment:

- Allocate a portion of the company's profits towards repaying the loan, while ensuring a
balance in reinvesting funds for business growth and expansion. This approach will help generate
additional profits in the long term, contributing to the repayment process.

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BUSINESS PLAN WHOLESELATRED IN AGRICULTER PRODUCTS JUNE 20244

5. Cash Reserves:

- Utilize existing cash reserves or set aside a contingency fund specifically for loan
repayments. This ensures a dedicated source of funds to cover any unforeseen circumstances or
temporary cash flow fluctuations without defaulting on the loan.

It is essential to regularly monitor and evaluate the financial performance of ABRON PLC, track
progress towards repayment goals, and makes any necessary adjustments to the plan as
circumstances change. Communication and coordination with lenders should be maintained to
ensure transparency and adherence to agreed-upon terms.

1.7.1. Risk Assessment and Disaster Management Plan

The Business has seriously planned to insure all its machineries against property, liability and
other types of risks and covered under Ethiopian Insurance Corporation policy. Periodical
orientations for employees on how to stand for the stewardship for the business and make it
sustainable is planned to be made. All the machinery operators will be given thorough training
on the business operations from time to time.

1.8. Conclusion and Recommendation

As clearly shown in the business plan report, the business is found to be feasible socio-
economically, financially and ecologically. Thus, the business deserves to get giving priority in
offering the requested loan financing for the further expansion of the business.

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BUSINESS PLAN WHOLESELATRED IN AGRICULTER PRODUCTS JUNE 20244
BUSINESS PLAN WHOLESELATRED IN AGRICULTER PRODUCTS JUNE 20244