DOCUMENT

: PROJECT PROPOSAL/BUSINESS PLAN

PURPOSE OF DOCUMENT
: TO SECURE A US$
300,000 SCHOOL PROJECT DEVELOPMENT AND
SUPPORT FACILITY

OBJECTIVE
: TO RE-EQUIP, MODERNIZE AND EXPAND
A PRIMARY SCHOOL IN UGANDA FOR DELIVERY OF A
QUALITATIVE, COMPREHENSIVE ND
A VALUE -FOR-
MONEY PRIMARY
-LEVEL EDUCATION

PERIOD OFFUNDINGAPPLICATION
: 9 YEARS

CLIENT/APPLICANT
: ST. JAMES NURSERY AND
PRIMARYBOARDING/DAYSCHOOL

LOCATION
: CENTRALUGANDA

IMMEDIATE TARGET BENEFICIARIES

:
 THE LOCAL COMMUNITY
 THE PUPILS
 NEEDY &ORPHANED CHILDREN
 THE SCHOOL
 THE UGANDA EDUCATION SOCIAL SERVICE
SECTOR
 THE CHRISTIAN COMMUNITY OF THE AREA

JUNE 2009
 iv
TABLE OF CONTENTS

S/NO DESCRIPTION PAGE

1.0 CRUCIAL FACTORS & STEPS IN DECISION

MAKING 1

1.1 Strengths 1 1.2 Weaknesses 1

1.3 Opportunities 1
1.4 Threats 1

2.0 GOVERNMENT POLICY ON PRIMARY EDUCATION 2

2.1 Overview – Uganda’s Formal Education System 2

2.2 Government Policy on Education 2
2.3 Specific Aims & Objectives of Primary Education 3
2.4 Implementation Strategy 4

3.0 GUIDING PHILOSOPHY & CORE VALUES OF

THE SCHOOL 6

3.1 Mission Statement 6 3.2

Vision Statement 7
3.3 MKC Values 7
3.4 Statement of Faith 8

4.0 PROJECT PROFILE 10

4.1 Opportunity Rationale 10

4.2 Project Concept 12
4.3 Project Cost 15
4.4 Project Returns 15
4.5 Viable Economic Size 15
4.6 Proposed Capacity 16
4.7 Business Legal Status 16

5.0 THE COMPANY AND SPONSORS 17

 v
5.1 The Company 17
5.2 The Sponsors/Promoters 17

6.0 CURRENT INDUSTRY STRUCTURE 20

7.0 MARKET ANALYSIS 22

7.1 Demand 22 7.2 Supply 23

7.3 Competition and Comparative Advantages 24
7.4 Fees 25
7.5 Marketing Strategy 25

8.0 TECHNICAL ASPECTS 26

8.1 Curriculum 26
8.2 Regulations 27
8.3 Admissions and Classes 28 8.4
Management and Staffing 28
8.5 Location and Infrastructure 33
8.6 Buildings and Other Infrastructure 33
8.7 Sports Facilities 34
8.8 Equipment, Furniture, Fixtures 34
8.9 Vehicles 34

9.0 PROJECT TIMETABLE 35

10.0 ENVIRONMENTAL CONSIDERATIONS 37

11.0 PROJECT COST AND FINANCIAL PLAN 39

11.1 Estimated Project Cost 39

11.2 Proposed Financing Plan 39

12.0 PROFITABILITY AND FINANCIAL CONDITION 41

 vi
12.1 Profitability 41
12.2 Company Financial Condition 42
12.3 Sensitivity Analysis 42

13.0 DEVELOPMENT AND SOCIAL IMPACT

CONSIDERATIONS 43

14.0 SPECIAL FEATURES, RISKS, AND ISSUES 44

15.0 KEY ASSUMPTIONS 45

15.1 Financial Assumptions 45

15.2 Revenue Assumptions 45
15.3 Miscellaneous Assumptions 46
 vii

LIST OF TABLES

T/NO DESCRIPTION PAGE

1. Year-wise Number of Students 16

2. St. James Nursery & Primary Sch. Enrolment Growth 18

3. Literacy rates for population aged 10 years and above 20

4. School Manpower 30

5. Existing and Planned Infrastructure at St. James Nursery

And Primary School 33

6. Breakdown of Project Costs 39

7. Proposed Financing Plan 39

8. Summary of Financial Projections 41

9. Sensitivity Analysis 42
 viii

LIST OF FIGURES

F/NO DESCRIPTION PAGE

1. The Ugandan education and training system 2

2. Enrollment at Primary School Level 12

3. St. James Nursery & Primary Sch. Organization Chart 31

4. Project Implementation Chart 36

LIST OF ANNEXES

A/NO DESCRIPTION PAGE

Annex 1: Notes to and Key Assumptions used in

Financial Projections 47

Annex 2: Projected Balance Sheet 53

Annex 3: Projected Income Statement 54

Annex 4: Projected Funds Flow Statement 56

 ix
Annex 5: Projected Cash Flow Statement 57

Annex 6: Projected Financial Measures 58

Annex 7: Supporting Financial Information

7A Summary Project Cost and Financing Plan 59
7B Enrollment and Revenue Projections 60
7C Direct and Indirect Cost Schedule 62
7D Depreciation Schedule 63
7E Loan Repayment Schedule 65
7F Working Capital Schedule 66
7G Rate of Return Calculation 67
7H Sensitivity Analysis 68
 Project Proposal/Business Plan Corporate Documenti

PROJECT SUMMARY

Project Name: ST. JAMES NURSERY AND PRIMARY SCHOOL

Country Location: Central Uganda.

Exchange Rate: US$ 1.00 = UShs. 2,160.

Project Promoters: Serunkuma Robert Namusoke

Sarah
Namirembe Imelda
Mutebi Godfrey.

Project Description: To re-develop and expand on the existing day and

boarding primary school with the objective of
turning it into a modern/standard primary school
able to offer children a comprehensive and
competitive primary school education founded in
core Christian values and ethos.

Market/Marketing: The market is a mixed composition of low-income and

middle-income families in Central Uganda. This is a
fairly densely populated area that offers a good
source for pupils.

Management and
Technical Assistance: The principal project promoter – Serunkuma
Robert is a keen and experienced business
entrepreneur who spearheads a
highlymotivated team of project promoters
that manages the school.

Estimated
Project Cost: US$ 492,094 comprising of:

US$ UShs. Million

Land 46,512 100

Buildings, infrastructure 306,865 659.76
Equipment 20,837 44.80
Furniture, fixtures and fittings 41,060 88.28
 Project Proposal/Business Plan Corporate Documentii
Vehicles 11,628 25.00
Books/Scholastic materials 13,099 28.16
Pre-operational expenses 37,210 80.0
Working Capital 14,884 32.0
TOTAL PROJECT COST 492,094 1,058.00
Proposed Project
Financing: It is proposed that the project is financed as follows:

US$ Shs. %
Million

Promoter’s Equity 192,094 413.00 39

Medium/Long Term Facility 300,000 645.00 61
TOTAL FINANCING 492,094 1,058.00 100

Profitability: The Internal Rate of Return [IRR] of the project is 39% while
the Rate on Equity is 23%.

Development Impact: The project will contribute to the private sector’s

capacity in supplying social infrastructure services
and will provide high quality primary standard
education for pupils. The project will create
approximately 54 jobs.

Current Status: The school has been operating since 1999 from the
start-up building infrastructure and educational
facilities improvised by its first 10 founders.
Currently, the school has 200 boarding and day
students. The current site offers adequate space [0.9
ha.] for expansion and re-development of the school
as proposed in this plan. Financing for this school
expansion phase is required by September 2009.
 Project Proposal/Business Plan Corporate Documentiii

5 Good Reasons on Why St. James Nursery and Primary

Day/Boarding School Seeks a US$ 300,000 Project Financing Fillip to
Support its Re-development and Expansion Programme

1. To hire and retain quality teachers who are equipped with the requisite
classroom instructional skills and mentoring know-how necessary for
the moulding and shaping of young mind into the exemplary students
and successful people of tomorrow.

2. To greatly improve upon the school’s infrastructure and other essential

amenities with an eye to the future: the up-grading of the school to
include a modern boarding secondary school within the next five to ten
years from now.

3. To acquire and stock quality scholastic and other instructional

materials that fit within Uganda’s primary school curriculum for
exclusive use by the school.

4. To raise the educational standards of the school to such a competitive

level that will serve to attract a matching fees structure that will be
adequate to cater for the educational, spiritual, nutritional and
residential needs of the pupil community at the school while at the
same time sustaining the momentum of high performance and delivery
that will have been generated henceforth.

5. To cultivate, nurture, encourage, instill and motivate the young pupils

to develop a spirit of embracing other non-core educational activities
that the school will be offering such as vocational training subjects and
a variety of other extra-curricula activities specifically designed to
develop the practical capabilities as well as the all-round mental and
physical development of the pupils.
 Project Proposal/Business Plan Corporate Document

1.0 CRUCIAL FACTORS & STEPS IN DECISION MAKING

1.1 Strengths

• Low Student teacher ratio (less than 40 students/teacher at full

capacity).
• Reasonable space per student (12 sq. ft per student).
• Helping and guiding attitude of teachers.
• Competent teaching faculty.
• Dynamic Leadership.
• Well maintained order and discipline.
• Environment conducive to joyful learning.
• Availability of adequate facilities.

1.2 Weakness

• Difficulty in building confidence of the community.

• Initially poor intake of students.
• Low operating loss in the initial year due to high fixed costs.

1.3 Opportunities

• Government incentives and policies conducive for private

investment in education sector.
• Gap between number of school going age children and actual
enrolments in schools.
• Increasing general public awareness (especially in rural areas)
about importance of Education.

1.4 Threats

• New entrants can easily share the business.

1
 Project Proposal/Business Plan Corporate Document

2.0 GOVERNMENT POLICY ON PRIMARY EDUCATION

2.1 Overview – Uganda’s Formal Education System

Education is a fundamental human right as well as a catalyst for

economic growth and human development (World Bank, 1993). The
constitution of the republic of Uganda articles 30 makes education for
Ugandan Children a human right, and in article 34 children are entitled
to basic education by the state and the parents.

Uganda’s formal education system starts with seven years of primary

school (ages 6-12), which is compulsory (supposedly) and free
according to the current Universal Primary Education (UPE) policy. This
is followed by six years of secondary education (ages 13-18), which is
optional though plans are under way to make it universal too. This
level is succeeded by three to five years of University or tertiary
education depending on the profession selected by the individual.
Figure 1 shows the education and training trajectories in Uganda.

Figure 1: The Ugandan education and training system

University Uganda
Teacher
Poly
Training Technic
Technical Specialist Vocational Technical
NTCs (Degrees) (Diploma
) & Business Training Training Institutes
Colleges Colleges Centres
PTCs (Diploma )
(Diploma
) (Certificate
) +
Upper Secondary (Certificate
) (Certificate
)
(UACE
)

Lower Secondary (UCE) Technical & Vocational

Schools

UPE/Primary Education (PLE)

2
 Project Proposal/Business Plan Corporate Document

2.2 Government Policy on Education

Education is one of Government’s key sectors and has continued to

receive priority in resource allocation. Today 33% of total government
discretionary recurrent budget is allocated to the education sector,
with primary education, including the primary teacher-training budget,
receiving more than 62% of this allocation. Secondary education
currently receives 15% of the sector recurrent budget allocation, (also
including secondary teacher training).

Education policy in Uganda has evolved over the years resulting in

several documents, one of which is the White Paper on Education
Policy of 1992. The document covers all levels of education from
preprimary to higher education, and all types of formal education such
as general, technical, vocational, teacher training as well as non-
formal education. The Ministry of Education has developed a sectoral
approach to education in partnership with funding agencies. The
Education Strategic Investment Plan (ESIP) 1998 – 2003 was a
medium term vehicle that embodies this approach and other key
aspects of the Education White Paper.

Current national priorities, as stipulated in policy documents issued by

the Ministry of Education and Sports, include: -

i) Provision of Universal Primary Education (UPE); ii) Sensitization of

the population about UPE in order that communities fully participate in
its implementation; iii) Provision of construction materials for primary
and secondary schools and tertiary institutions in a progressive
manner;
iv) Improvement of Teacher Training Programmes and rehabilitation of
Teachers’ Colleges;
v) Making the Teacher central in our education system by creating a
well trained, facilitated and disciplined teacher; vi) Improving the
teaching of science, mathematics, technical and technology
education at all levels;
vii) Vocationalization of the curriculum through a systematic
introduction at all levels through staff development programmes; viii)
Review and reform of the examination in order to incorporate
continuous assessment; and, ix) Implementation of strategies that will
redress the existing imbalances i.e. gender, geographical, social, or
otherwise as well as the disparities in education standards and

3
 Project Proposal/Business Plan Corporate Document

performance throughout the education system in general and primary

and secondary education in particular.

2.3 Specific Aims and Objectives of Primary Education

The Government of Uganda [GoU] acknowledges the fact that much of the
present curriculum at primary level does not relate to the needs of the
community served by the schools but largely aims at preparing at
preparing children for a more academic secondary level education.
Government agrees that primary education should be re-oriented to cater
for the real development needs of the community and the nation.

The Government of Uganda [GoU], therefore, endorses the following

aims and objectives of primary education which are outlined by the
Education Policy Review Commission.

i. To enable individuals to acquire permanent functional and

developmental literacy, numeracy and communication skills in
Kiswahili, the local language and English;

ii. To develop and maintain sound mental and physical health;

iii. The instill the value of living and working co-operatively with
other people and caring for others in the community;

iv. To develop and promote constructive and developmental

cultural, moral and spiritual values of life.

v. To inculcate an understanding of, and appreciation for, the

protection and utilization of the natural environment using
scientific and technological knowledge;

vi. To develop a sense of patriotism, nationalism and national unity,

an understanding of one’s rights and responsibilities and an
appreciation of the need to participate purposefully, actively,
positively and constructively in civil matters;

vii. To develop pre-requisites for continuing education and

development; and

4
 Project Proposal/Business Plan Corporate Document

viii. To develop varieties of basic practical skills for enabling

individuals make a living in a multi-skilled manner.

2.4 Implementation Strategy

The Government of Uganda [GoU] generally concurs with the

Education Policy Review Commission’s specification of the following
target skills to be derived from the primary school curriculum:

i. Skills in communication, oral expression, reading and writing in

Kiswahili, English and the local language.
ii. Basic computation skills, including skills in addition, subtraction,
multiplication and division.

iii. Knowledge of the natural environment and its utilization and

conservation, and of physical and biological sciences;

iv. Knowledge of the social environment and social institutions, civic

rights and responsibilities, the country’s culture, history and
geographical features;

v. Physical development and inculcation of progressive and

balanced emotional control through games, sports, hobbies and
good health habits;

vi. Aesthetic skills through music, drama and art;

vii. Home Science and basics of health and family life;

viii. Ethical development through religious and moral education; and

ix. Agriculture and other pre-vocational skills, such as business and

commercial skills [including familiarity with simple tools and
materials and ability to prepare simple reports, records and
accounts];

x. Progressive ideas and ideals, and development knowledge,

attitudes and ambitions, through social studies and current
affairs and other subjects.

5
 Project Proposal/Business Plan Corporate Document

3.0 GUIDING PHILOSOPHY & CORE VALUES OF THE

SCHOOL

3.1 Mission Statement

The mission of St. James Nursery and Primary School is to provide

superior, Christian education consistent with Biblical principles. A
dedicated, professional faculty presents God as the source of all life
and truth. Within a secure, loving environment, students will discover
their individual gifts and develop spiritually, socially, and intellectually.
We strongly believe that the union of our school, its families, and their
churches will equip our students for a life pursuing excellence and
integrity under the Lordship of Christ.

Our Commitment

In the light of the Lordship of Jesus Christ and the authority of God's
word, we will educate each unique student in cooperation with the
Christian community so that he or she is equipped and inspired to make
a difference for Jesus Christ in the world.

Our Core Values

St. James Nursery and Primary School has developed the following
core values to provide a firm foundation for our school.

1. Christian administration and faculty model Christ in teaching and

leading.

6
 Project Proposal/Business Plan Corporate Document

2. All programmes, academic, sports, after school, scouting, and

music, exhibit Christ-centered leadership.
3. High academic standards are maintained with internal and
external evaluation welcomed.
4. The curriculum and other programs are focused on excellence.
5. The environment is loving, supportive and nurturing for children,
families and staff.
6. The process of the integration of faith and learning in all
academic disciplines is maintained.
7. Organizational practices such as business, development,
marketing, personnel and government are all Christ-centered.
8. The teaching of the Bible as a core subject is essential to the
academic curriculum.
9. Professional development and resources are vital for growth of
the school.
10. The teaching/learning process at St. James Nursery and
Primary School reflects a Christ-like sensitivity.
11. Students learn how to process information in the context of
a biblical Christian world view.

Our Calling

FORMING students to become more like Jesus.

We serve parents and students from culturally and ethnically diverse

communities and will equip and inspire each unique student to live and
serve as a follower of Jesus Christ in the world today.

INFORMING students to prepare them for service.

We provide students with models, opportunities, skills, and information

necessary to become caretakers of God's creation and healing agents
in a broken society.

TRANSFORMING students to impact contemporary society for Christ.

We prepare students to answer Christ's call to be the salt of the earth

and the light of the world, permeating all of society, pointing to Jesus,
righting injustice, and working for Biblical alternatives in every part of
life.

7
 Project Proposal/Business Plan Corporate Document

3.2 Vision Statement

St. James Nursery and Primary School will strive to provide a

Christ-centered educational program focusing on spiritual growth and
academic excellence which honours God in all respects.

3.3 St. James Nursery and Primary School Values

THE VALUE OF A ST. JAMES NURSERY AND

PRIMARY SCHOOL EDUCATION

St. James Nursery and Primary School leavers:

VIEW
1) History and the world around them as part of God’s creation and plan.
2) Education as a life-long endeavour with a commitment to excellence.
3) Themselves as active and responsible citizens of a diverse nation and world.
ACHIEVE
1) Proficiency in using information and technology responsibly. 2)
An appreciation for the fine arts.

LEARN
1) The characteristics of a healthy lifestyle and habits.
2) Problem-solving and decision-making skills.
3) To match their gifts with educational and career options.

UNDERSTAND
1) The worth of all humanity as created in the image of God.
2) The difference between a Christian and secular worldview. 3)
Written and oral communication with discernment.

EXPRESS
1) Their ideas clearly, creatively and effectively through oral, written
and artistic means.
2) Their belief in Jesus as their personal Saviour and their gratitude
to God through a life of service.

3.4 Statement of Faith

 God

8
 Project Proposal/Business Plan Corporate Document

There is one God and He is sovereign and eternal. He is revealed in the

Bible as three equal divine Persons - Father, Son and Holy Spirit. God
depends on nothing and no one; everything and everyone depends on
Him. God is holy, just, wise, loving and good.

God created all things of His own sovereign will, and by His Word they
are sustained and controlled.

God is the God and Father of our Lord Jesus Christ. He is also Father of
all whom He has adopted as His children. Because of God’s faithfulness
and His fatherly concern, nothing can separate His children from His
love and care.

The Lord Jesus Christ is the eternally existing, only begotten Son of
the Father. He is the Creator and Sustainer of all things. He was
conceived by the Holy Spirit and born of a virgin, truly God and truly
man. He lived a sinless life and died in our place. He was buried, rose
from the dead in bodily form and ascended to heaven. Jesus is King of
the universe and Head of the Church, His people whom He has
redeemed. He will return to gather His people to Himself, to judge all
people and bring in the consummation of God’s Kingdom.

The Holy Spirit proceeds from the Father and the Son. He convicts
people of their sin, leads them to repentance, creates faith within them
and regenerates them. He is the source of their new sanctified life
bringing forth His fruit in the life of believers. He gifts believers
according to His sovereign will, enabling them to serve the Lord.

 The Bible The Bible, which is comprised of the books of the

Old and New Testament, is the inspired, inerrant and infallible
Word of God, and the only absolute guide for all faith and
conduct. It is indispensable and determinative for our knowledge
of God, of ourselves and of the rest of creation.

 God’s world
Adam and Eve, the parents of all humankind were created in the image
of God to worship their Creator by loving and serving Him, and by
exercising dominion under God’s rule by inhabiting, possessing, ruling,
caring for and enjoying God’s creation. Consequently the purpose of
human existence is to glorify God and enjoy Him forever.

9
 Project Proposal/Business Plan Corporate Document

Sin entered the world through Adam’s disobedience, because of which

all people are alienated from God and each other and, as a result, they
and all creation are under God’s judgement.

All people have sinned and, if outside of Christ, are in a fallen, sinful,
lost condition, helpless to save themselves, under God’s condemnation
and blind to life’s true meaning and purpose.

God holds each person responsible and accountable for choices made
and actions pursued. Human responsibility and accountability do not
limit God’s sovereignty. God’s sovereignty does not diminish human
responsibility and accountability.

4.0 PROJECT PROFILE

4.1 Opportunity Rationale

The importance of education for human resource development does

not need any elucidation. Globally, it has been observed that countries
attached the highest priority to education since the development of
other sectors like health, agriculture and industry is dependent on the
development of education in the country. The Government of Uganda
[GoU] accepts education as a fundamental right for its citizens as well
as its commitment to provide access to education to every citizen. But
the Government faces constraints due to limited financial resources to
spend on education sector. Therefore, private sector investment is
being encouraged with various incentives to lower the burden of the
Government.

Although, traditionally, private schools have been a luxury only the rich
can afford, this is not necessarily the case in the current reemergence
of the private sector in Uganda's education system.

10
 Project Proposal/Business Plan Corporate Document

Challenges facing the Education Sector in Uganda

a) Quality Assurance - At the lower levels, the introduction of

Universal Primary Education (UPE) has put a strain on existing
infrastructure and facilities. For instance, following the introduction of
UPE, the average number of pupils per school in Uganda, jumped from
363 to 616 between 1996 and 1997. Although the number of teachers
rose from 81,564 to 89,247 during the same period, it did not keep
pace with the rapid increase in pupils, so that the pupil-to-teacher
ratio jumped from 38:1 to 60:1. The picture is even worse in the two
lowest primary classes where the ratio of students to teachers exceeds
100. Government has committed to various training programs to train
teachers and also to increase the number of classrooms. For the
private sector, there are opportunities to participate as suppliers or
building contractors in the classroom expansion program.

b) Practical Skills Orientation – Another major challenge facing

the education system is the restoration of relevant and practical skills
at all levels. Currently, the shortages of skilled labour including
technical and managerial staff are being met by foreign labour. Current
initiatives to improve the skills include the rehabilitation of the
Directorate of Industrial Training, which is expected to strengthen the
industrial and vocational training as well as improving industrial
management and productivity. There is therefore need for specialized
educational services that can equip human resources needed by the
labour market in the economy. Therefore, there are various
investment opportunities in specialized educational services and
investors are encouraged to take advantage of the various investment
concessions put in place by government.

Education Strategic Investment Plan (ESIP)

The Education Strategic Investment Plan (ESIP) 1997 – 2003,

Strategic and Programme Framework (ESIP Framework) is the
foundation on which the development of education in Uganda over the
medium term has been formulated. The ESIP Framework is founded
upon the 1992 Government White Paper on the Education Policy
Review Commission Report. It presents targets and implementation
strategies together with an outline of investment programmes, which
fulfill Government’s policy directions.

11
 Project Proposal/Business Plan Corporate Document

The ESIP Framework prioritizes the following key strategic policy

objectives: -

a) Expanding Access – through achieving universal enrollment of

primary school-aged children by the year 2003, ensuring that
postprimary vocational opportunities are in place for primary school
leavers and achieving and maintaining higher transition rates from
primary to secondary schools.
b) Quality Enhancement – through enhancing the quality and
relevance of instruction through procurement of relevant instructional
materials and training to teachers.
c) Increasing Equity – by continuing the shift in public
expenditure allocation in favour of broader access to basic educational
opportunities and directing special incentives to the disadvantaged
groups to attract them to school.
d) Public-Private Sector Partnership – through creating a
financial framework for sustained and equitable educational provision
with appropriate levels of contribution from public sector – private
sector and household community partnerships at post-primary level.
e) The Role of Central Government – by strengthening the
capacity of Central Government to formulate sectoral policy and
broadly direct financial resources in response to evolving priorities and
needs.
f) Enhancing the Capacity of the Districts and Local
Government - through promotion of greater participation of and
responsibility by local authorities and communities in the development
of education at all levels.

Keeping in view the significant and emerging role of the private sector
in the promotion of education at various levels, the Government has
also introduced the concept of Public-Private Partnership. The
suggested incentives to private sector educational institutions are:

• Provision of free land, or land on concessional rates in

rural/urban areas.
• Property tax exemption on school buildings.
• Exemption of 50% income tax to private sector institutions for
their faculty, management and support staff.
• Utilities availability on non-commercial rates.
• Exemption of custom duties on import of educational equipment.
• Undertaking necessary legislation to give Charter to private
sector institutions and facilitating their day to day affairs.

12
 Project Proposal/Business Plan Corporate Document

Private schooling has now become important for the country.

Enrolment in private primary schools is now in the order of 42 percent
of total enrolment (2004).

Figure 2: Enrolment at Primary School Level

Government
Schools 74.8%
Private
Schools
25.2%

4.2 Project Concept

This study describes the efforts by St. James Nursery and Primary
School to upgrade its primary schooling infrastructure and other
educational facilities so as to offer a vintage quality primary school
education that is competitive and cost-effective to its target market
population. The school project as proposed is meant to beget a twoway
advantage in this respect, but with the biggest beneficiary being the
student community at St. James Nursery and Primary School that
is situated at Kamwema in Mpala Village, Kitala Parish, Katabi
Sub-County, Busiro County of Wakiso District that is located in
Central Uganda on the northern shores of Lake Victoria.
The existing primary school has been functioning as a boarding/day
school since 1999 albeit with limited facilities, scholastic materials and
quality teaching staff owing to the fact that it is entirely supported and
run from the personal resources and goodwill of its
founders/promoters.

The school’s founder – Paul Kiyimba [RIP] started out with a vision
of gradual and phased development of the nursery/primary school to
secondary level by taking up existing educational market opportunities
to grow and expand it eventually into a high quality facility offering
comprehensive primary-secondary education to the surrounding area’s
resident population. However, in spite of the existing numerous

13
 Project Proposal/Business Plan Corporate Document

opportunities for growth and expansion of a nucleus primary school to

a secondary school with the requisite standards, the current
management of the school is not well positioned to take them as they
have to grapple with a wide range of challenges and obstacles in the
form of limited available surplus funds from fees revenues that can be
dedicated to capital development financing to the school’s physical
development and expansion programme. At the same time, being a
private-founded school, the Government of Uganda [GoU] does not
have any contingency funding measures in place to support struggling
private schools that a private-school like St. James Nursery and
Primary School can resource to realize and implement its visions and
development blueprints. It is also practically difficult to borrow funds
from the Uganda commercial financing sector for the stated purpose
owing to the prevailing high interest rates levied by such banks and a
dearth of development financing credit facilities for the Primary
Education sector since much of it tends to find its way to the more
lucrative Secondary Education sector or urban-based primary schools.

Historically, the Government of Uganda has been responsible for

providing education to its citizens [especially through the much-touted
Universal Primary Education – UPE programme]. However,
increased population, limited resources and deteriorating facilities have
led to a strong demand for private schools as an alternative to the
government aided schools. Government encourages private schools
and institutions to be set up.

The current promoters of the project [principally Mr. Robert

Serunkuma] are a core team dedicated to uplifting the standards of
education being offered by St. James Nursery and Primary School
– being experienced people in both the education and business aspects
of the project. Mr. Robert Serunkuma’s business development skills
and networking competencies are of particular relevance to the needs
of the project. The unique geographical location, demographics and
socio-economic status of the school’s surrounding locality offer a
reliable source for enrolment of school going age children.

The immediate development objective of St. James Nursery and

Primary School is to upgrade its facilities and infrastructure, recruit
and retain quality teachers so that it can offer quality education within
a modern and attractive setting. By offering quality education, St.
James Nursery and Primary School is expected to earn early
recognition and the parent’s trust and preference.

14
 Project Proposal/Business Plan Corporate Document

Other salient features that work in favour of the future success and
growth of St. James Nursery and Primary School are:

• Geographical Location. The fact that St. James Nursery and

Primary School is located in a high population density area
strongly underlines the critical need for quality primary education
schooling to serve the growing socio-economic development
needs of the inhabitant population. There are several primary
schools in the area, but most of them are struggling as they lack
the essential facilities and inputs necessary for attainment of a
top quality basic primary schooling standard of the type offered
by urban-based primary schools. So, there is a glaring gap for
qualitative primary schooling within the Katabi Sub-County
area that needs to be immediately filled. By stepping up to the
challenge, St. James Nursery and Primary School will be able
to attract quite a sizeable population of school going age children
– not only from the Katabi Sub-County area, but also from the
entire Wakiso
District at large.

• Demand. There is a strong and increasing demand for quality

primary schooling throughout Uganda at the moment owing to
the steady increase in population [estimated at 3.2% per
annum] and the realization of the social rate of return in the
education of children as a key human capital development tool.

• Socio-economic indicators of the area. This area [Katabi

Sub-County] is a peri-urban residential area and the residents
have strong and stable incomes accruing out revenues generated
from small-medium scale businesses and agricultural/fishing
activities. The residents of this area thus generally enjoy
comparatively higher standards of living than those in other less
endowed primarily arable-farming communities of Uganda. This
means that such a population can easily afford the cost of a good
quality primary school education for its children given the
opportunity. In any case, taking into consideration the facilities
that St. James Nursery and Primary School will offer, the
fees set will be similar to those of identical competitive primary
schools elsewhere in Uganda.

15
 Project Proposal/Business Plan Corporate Document

• Promoter’s Reputation. Mr. Robert Serunkuma – one of the

principal project promoters of St. James Nursery and Primary
School has already gained a good local reputation within the
area as a leading education service provider/entrepreneur. The
people here do recognize Mr. Robert Serunkuma’s
commitment to excellence in providing a good foundational
education for their children and his ambition to do to more for
their cause.

• Spiritual ethics and values. Parents in Katabi Sub-County

are strongly inclined to seek out schools like St. James Nursery
and Primary School that give their children not only the benefit
of a good basic education but also a solid foundation in Christian
ethics, morals and values to supplement what they offer their
children at home.

4.3 Project Cost

The total capital development budget for the proposed St. James
Nursery and Primary School expansion programme is US$
352,094 of which US$ 52,094 [14.80%] is the project promoter’s
equity commitment and US$ 300,000 [85.20%] is to be raised from
donor sources.

4.4 Project Returns

The project seems to be viable with 39% internal rate of return and a
pay back period of 3.89 years. The net present value [after tax] of
the project is US$ 52,981.69. Discount rate used for NPV is 28%.

4.5 Viable Economic Size

Since, it is a service sector project, there is no hard and fast criterion

for viable economic size, rather it depends upon many factors like
faculties needed, infrastructure requirements, schools fixed overhead,
etc.

4.6 Proposed Capacity

For the purpose of this proposal, strength of 560 students has been
proposed. The distribution is 70 pupils per class [Primary 1 to Primary
7] with each class having two streams of 35 students each.

16
 Project Proposal/Business Plan Corporate Document

Table 1: Year wise Number of Students

Students/Year Year Year Year Year Year Year Year Year Year Year
1 2 3 4 5 6 7 8 9 10
Nursery 70 70 70 70 70 70 70 70 70 70
P1 70 70 70 70 70 70 70 70 70 70
P2 70 70 70 70 70 70 70 70 70 70
P3 70 70 70 70 70 70 70 70 70 70
P4 70 70 70 70 70 70 70 70 70 70
P5 70 70 70 70 70 70 70 70 70 70
P6 70 70 70 70 70 70 70 70 70 70
P7 70 70 70 70 70 70 70 70 70 70
Total
Students 560 560 560 560 560 560 560 560 560 560

4.7 Business Legal Status

St. James Nursery and Primary School Limited is registered as a

limited liability company in the Republic of Uganda and is the legally
recognized enterprise running St. James Nursery and Primary
School. The primary school is also registered with the Ministry of
Education and Sports [MoES] – under Registration No.
PPS/S/247.

17
 Project Proposal/Business Plan Corporate Document

5.0 THE COMPANY AND SPONSORS

5.1 The Company

The legal entity that owns and runs St. James Nursery and Primary
School is St. James Nursery and Primary School Limited. This
company was incorporated in the Republic of Uganda way back in
February 1999 and has the following ownership structure:

Shareholder %age of Shares held

Robert Serunkuma 35%

Sarah Namusoke 30%
Imelda Namirembe 20%
Godfrey Mutebi 15%
100%

All are directors/shareholders of the company are Ugandan nationals.

The school was licensed by the relevant licensing authority, the

Ministry of Education and Sports on the 27th June 2008.

5.2 School Profile

St. James Nursery and Primary School is a Christian-founded

school. It was founded in February 1999 by two [2] Directors – Mr.
and Mrs. Kiyimba with the motto: “With God All is Possible”. The
two founders later on sold the idea to Mr. Mutebi Godfrey, Mrs.
Namirembe Imelda, Mr. Muhwezi James and Mr. Serunkuma
Robert with a view of supporting the needy and orphans among
others. The current chairman of the Board of Directors is Serunkuma
Robert.

5.2.1 The First Staff

The first teaching staff of the school at the time it started out in 1999
were only ten [10] dedicated teachers who devoted themselves to
building the academic reputation of the school from scratch up to the
present. Some of them have however since passed on. Below is a list
of these first ten [10] school-founding teachers:-

18
 Project Proposal/Business Plan Corporate Document

Mr. James Muhwezi;

Mr. Paul Opio – Deputy Headmaster;
Ms. Sarah Namusoke – P.4 Class Teacher/Bursar;
Ms. Damalie Nabirye – Nursery Teacher;
Ms. Josephine Amaido – P.5 Class Teacher;
Mr. David Apeli – P.7 Class Teacher;
Mr. Paul Kiyimba [RIP] – Head of Mathematics;
Mr. James Muhwezi – Head of Science;
Ms. Judith Nayiga – P.2 Class Teacher;
Ms. Rose Nasaka – P.1 & P.2 Class Teacher.

5.2.2 The School Facilities

The school started by renting for premises at a rate of UShs. 200,000

per month [equivalent to US$ ………… by then]. The rent charges
followed inflationary trends and jumped by 67% in two years time.
Despite the continuous rental pressures on the school’s development
programme, the Board of Directors did however manage to marshal
sufficient resources from savings and directors’ contributions to
construct a School Library. In the course of time, the school has also
acquired its own 2.25 Acre plot of land where it has so far been able to
put up two classroom/dormitory blocks, one classroom/staffroom
block, one sick bay block plus sanitary facilities.

5.2.3 Academic Enrolment

The school started out with 24 pupils at the time it opened its doors in
1999. This enrolment figure has eventually evolved to grow to the
present 200 students [as of 2009]. The school’s enrolment evolution
over the years is depicted in Table 2 below.

Table 2: St. James Nursery and Primary School Enrolment Growth

[1999 – 2009]

Year 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
No. of
Students 24 70 80 140 165 190 215 240 190 195 200

The school has registered excellent grades at the Primary Leaving

Examinations [PLE] level for the last six years [2003 – 2009] that it
has presented Primary Seven [P.7] candidates for the PLE exams.

19
 Project Proposal/Business Plan Corporate Document

5.2.4 Orphans and Needy Children

At the time it started its primary education schooling programme, one

of the school’s areas of focus was to support the education of orphans
and other needy children. To this end the school immediately took up
the support of eight [8] pupils which it has since grown to a current
number of about thirty-five [35] school dependents. The affected
pupils are mostly those who are in dire need of educational and
material support as a result of either being from marginally-poor
families of having lost one or both of their parents to the AIDS/HIV
pandemic that swept through Uganda for much of the 1980s and
1990s.

The prevailing situation at our school is that the lower primary level is
the most disadvantaged section in terms of having the highest
numbers of orphans/needy children as compared to the upper primary
section.

5.2.5 The School’s Income

Although some desperately poor parents only pay partial tuition fees,
the bulk of the school’s recurrent and development budget is mostly
met from the contributions in form of donations/grants and a variety of
support funds/facilities by friends, well-wishers, philanthropic agencies
and a whole range of children welfare and development social support
groups in Uganda. We therefore try as much as possible to outsource
of school-support resources and facilities from a diverse patchwork of
well-intentioned benefactors and educational development actors alike.
The late Paul Kiyimba [the original school founder] was one of the
key sponsors of the school whose contributions and support have been
memorialized.

In addition to the above-highlighted school-support resources, the

feeding of pupils, putting up teachers’ accommodation facilities,
acquiring a school truck [for movement of school supplies and other
general transportation functions], the construction of a modern and
primary school with attractive and enticing infrastructure [including a
Computer Lab, School Library and Sciences Laboratory] remain huge
but necessary challenges ahead of us.

20
 Project Proposal/Business Plan Corporate Document

6.0 CURRENT INDUSTRY STRUCTURE

Education is key to change and progress, therefore, Government of

Uganda has adopted this sector as one of the pillars for poverty
reduction and benefit of masses. Government is fully committed to
provide best Educational Facilities to its people within the minimum
possible time.

Uganda has surpassed the 50% target of achieving adult literacy by

2015 under the fourth goal. The 2005/06 Uganda National Household
Survey revealed an overall literacy rate of 69 percent among persons
aged 10 years and above.

However, there is a glaring gap between rural and urban areas in adult
literacy with northern Uganda lagging behind at 45% and the highest
in the central region at 78%.

The report projects that by 2015, at least 75% of adults in Uganda will
be literate.

More males were found to be literate (76 percent) than females (63
percent). The literacy rates in 2002/03 and 2005/06 have remained
more or less the same, regardless of sex (see Table 3).

Table 3: Literacy rates for population aged 10 years and above

Male 1999/00 Total Male 2002/03 Total Male 2005/06 Total

Female Female Female
Uganda 74 57 65 77 63 70 76 63 69

Residence
Urban 92 82 86 90 84 87 89 83 86
Rural 72 54 62 74 60 67 74 58 66

21
 Project Proposal/Business Plan Corporate Document

Region
Central
Excluding 81 74 77 82 74 79 82 78 80
Eastern 72 62 62 72 54 63 71 56 64
Northern 64 33 47 72 42 56 74 45 59
Western 74 61 67 79 69 74 74 60 67
Kampala _ _ _ 94 91 92 92 90 91

In Uganda, there are 12,280 primary schools 74.8 % of, which are
government owned and funded. Most of the primary schools - 97.7 %
are co-educational schools, 0.4% are for boys only, 0.5% are for girls
only and 1.4% is unknown (MoES 2001). The available data shows
that day schools account for 92.8 %, full boarding schools 0.6%, partly
boarding (with both day and boarding pupils) schools 5%, and
unknown 1.6% (Ibid, 2001).

The number of teachers on the government payroll increased with one

third, from 82,148 in 2000 to 128,262 in 2007.

There are an additional 14,000 teachers in private schools which are

not on the Government payroll.

As a result, the number of pupils per teacher dropped from 52 to 48.

22
 Project Proposal/Business Plan Corporate Document

7.0 MARKET ANALYSIS

There is stiff competition amongst the school running in the market.

Parents are curious about the future of their children so they think
extensively before admitting their children in any school. Following are
the main factors (not conclusive) on the basis of which parents make
choice of schools.

1. Distance from home

2. School track record/history
3. General reputation
4. Fees
5. Qualification and experience of the head of school and other
faculty.
6. Physical infrastructural facilities.
7. Courses offered and medium of instruction.

Besides the above, there are some other subjective, social and status
considerations which also play an important role in making decision.

7.1 Demand

Several factors have created a strong demand for private primary

schools in Uganda.

23
 Project Proposal/Business Plan Corporate Document

• The government has been unable to maintain adequate teaching

standards and educational facilities due to limited resources. As
a result of this, the quality of education in government-aided
primary schools has declined.

• The increased population has led to overcrowding in government

schools, further reducing the quality of education.

• The government started Universal Primary Education [UPE]. This

is free primary education to four children per family. There will
be many more students who will want to enroll in
governmentaided primary schools that the available places.

The existing high quality private schools are filled to capacity and the
administrators of these schools confirm that they receive more
applications that they can accommodate.
In 2000, the number of children aged 6-12 in primary schools to the
number of children of the same age in the entire population was
85.5%. This has steadily grown to 91.7% in 2006.

In primary schools, the ratio of boys to girls’ enrolment has improved

from 51.8% for boys and 48.2% for girls in 2000 to 50.2% and 49.8%
respectively in 2006.

THE number of primary schools pupils has tripled since the

Government introduced Universal Primary Education (UPE) in 1997. In
1995 there were 2.63 million pupils in primary schools as compared to
7.41 million in 2007, according to the Education Information
Management system.

Of the 7.41 million pupils last year, there were 3.71 million boys and
3.69 girls, reflecting a 49.9% of girls' enrollment.

Of the 7.41 million pupils enrolled in primary school last year, about
5% are in private schools. As the quality of Government-aided primary
schools continues to decline and the number of students grows,
demand for private schools is expected to rise, especially among the
middle and upper income families that can afford an alternative to the
government aided primary schools. Administrators of the main private
schools in Kampala for instance state that demand for their services is
growing as indicated by the increase in student enrolment in these
schools during recent years. To accommodate the growing demand,
more private schools are required.

24
 Project Proposal/Business Plan Corporate Document

7.2 Supply

Private primary schools operate in parallel with the government aided

schools. They are generally more expensive than the government
aided schools. The higher quality private schools are considered to
offer education only comparable to the top government aided schools.
The top private schools are segmented primarily according to fees. All
private schools charge fees, which are affordable by middle and upper
income Ugandans. There are lower cost private primary schools as
well, but they do not offer the highest standard of education and so do
not compete in the market segment targeted by St. James Nursery
and Primary School.

7.3 Competition and Comparative Advantages

There are several competitors to St. James Nursery and Primary

School within the Katabi Sub-County area. Some of these primary
schools may charge lower fees than St. James Nursery and Primary
School but would not be able to compete favourably with St. James
Nursery and Primary School in the sense that they may not be able
to offer the range of extra-curricular activities, nor provide the quality
of facilities that St. James Nursery and Primary School will be in
position to offer.

St. James Nursery and Primary School will have several

competitive advantages relative to other schools in the area as follows:

• A favourable location within a socio-economically prosperous

setting [the Katabi Sub-County area lies on the KampalaEntebbe
urban axis that is one of the fastest-growing areas in Uganda in
terms of socio-economics and average per-capita income levels
for the last 10 – 20 years]. Also, the fact that the primary school
is very near to the Entebbe – Kampala main road [only 2 kms
away] accords it a distinct advantage insofar as being able to
attract a sizeable student population from the rapidly-growing
population within the locality;

• Boarding option equipped with all facilities a student requires,

which are not offered by main competitors;

25
 Project Proposal/Business Plan Corporate Document

• A principal promoter with a strong background in both education

and business;

• Students will be provided with all manner of scholastic materials

as well as beddings [beds, mattresses and bed linen and
uniform];

• The curricula offered will be comprehensive primary school. The

curricula offers traditional academic subjects with relevant
practical skills and vocational subjects;

• Excellent athletic and sports facilities.

7.4 Fees

Fees for the school have been set taking into consideration the
facilities being provided and the expected quality of education. No
increase of fees is assumed in the financial projections. St. James
Nursery and Primary School will quote fees in Uganda Shillings. The
Uganda Shilling has been relatively stable against major international
currencies like the British Pound and the US Dollar and is expected to
remain so. The facilities being provided by St. James Nursery and
Primary School will be much superior to those available at the other
schools operating in Wakiso District. Hence the quoted fees [for
boarders] of UShs. 450,000/Head/Term [US Dollars
210/Head/Term] will be very competitive. Furthermore, there will be
room for upward adjustment should this be deemed necessary.

7.5 Marketing Strategy

The school will be marketed through direct contact with selected

individuals and institutions.

A brochure about the school will be produced. It will be distributed to

individuals in major institutions in Uganda such as banks, large
corporations, as well as personal contacts of the project promoter –
mostly within Kampala and the main urban centers, as well as
education-oriented Christian Charity organizations outside Uganda.

26
 Project Proposal/Business Plan Corporate Document

The project promoters will organize media coverage of the school.

Articles in newspapers and television interviews will be used to reach
the target market while still maintaining the school’s image. Given the
high for a good private primary school and the promoter’s extensive
personal and professional contacts, reaching the maximum capacity of
560 pupils within the very first year of operation [after reconstructive
extension] is not expected to pose a problem. Once the school is fully
operational, its performance and reputation will be a satisfactory
marketing tool as is the case for other top private primary schools in
the country.

8.0 TECHNICAL ASPECTS

8.1 Curriculum

St. James Nursery and Primary School will offer syllabi of the
comprehensive primary curricula leading to the Primary Leaving
Examinations Certificate. The Primary School curriculum is set by
the Ministry of Education and Sports [more specifically, the UNCDC –
the Uganda National Curriculum Development Centre]. The
comprehensive primary school curriculum will be used because of its
objectives, which are:

a) To enable individuals to acquire functional, permanent and

developmental literacy, numeracy, and communication skills in
English, Kiswahili, and at least one Uganda language.
b) To develop and maintain a sound mental and physical health among
learners.
c) To instil the values of living and working co-operatively with other
people and caring for others in the community.
d) To develop and cherish the cultural, moral and spiritual values of
life and appreciate the richness that lies in our varied diverse
cultures and values;

27
 Project Proposal/Business Plan Corporate Document

e) To promote understanding and appreciation for the protection and

utilisation of the natural environment, using scientific and
technological knowledge and skills;
f) To develop an understanding of one’s rights and civic
responsibilities and duties for the purpose of positive and
responsive participation in civic matters.
g) To develop a sense of patriotism, nationalism, and national unity in
diversity;
h) To develop pre-requisites for continuing education;
i) To acquire a variety of practical skills for enabling one to make a
living in a multi-skilled manner.
j) To develop an appreciation for the dignity of work and for making a
living by one’s honest effort;
k) To equip the child with the knowledge, skills and values of
responsible parenthood;
l) To develop skills in management of time and finance and respect for
private and public property;
m)To develop the ability to use the problem-solving approach in
various life situations, and;
n) To develop discipline and good manners.

Primary Level schooling in Uganda is a seven year course. After the

Primary Leaving Examinations [PLE], students proceed to the UCE
[Uganda Certificate of Education or in more general terms,
OLevel]. This is a four-year course. The UCE allows entry to the
Uganda Advanced Certificate of Education [UACE or A-Level]] and
later on the Uganda University system and is accepted internationally
outside of Uganda. Secondary school education is becoming highly
competitive in Uganda nowadays because of the very high numbers of
the government-inspired UPE [Universal Primary Education]
programme, and the comparatively limited outlets of quality secondary
education available on the market – so parents will often seek the best
primary education they can afford for their children to able to make it
to good secondary schools. The school year will run from January
through December.

8.2 Regulations

Outlined below are the existing approval procedures and regulations

for licensing and registration of a new private school or institution.

28
 Project Proposal/Business Plan Corporate Document

a) The intending proprietor makes known his or her intention to

start a School to the Commissioner for Education and seeks his or her
permission to do so in writing.
b) The Commissioner for Education writes back acknowledging
receipt and granting or disallowing permission.
c) The Proprietor receives application forms for license from the
District Education Office.
d) The District Inspector of Schools and the District Health Inspector
inspect the intended School and attach detailed reports.
e) The District Education Officer forwards three copies of the
application forms to the Commissioner for Education (Inspectorate)
Ministry of Education and Sports.
f) The Commissioner for Education Inspectorate basing on either
reports or recommendations from the district or a report following a
physical inspection by the Central Inspectorate recommends to the
Commissioner for Education who approves or rejects the application
for license.
g) The Commissioner for Education approves and awards a license
to last one year, copied to the Commissioner for Education
(Inspectorate), District Education Officer, District Inspector of School
and the Head-teacher.
h) About one or two months to the expiry of the one year license,
the proprietor collects forms for registration providing details showing
that the School is now fully established and meets the minimum
requirements.
i) The District Inspector of Schools re-inspects the said school for
registration.
j) The District Education Officer recommends to the Commissioner
for Education (Inspectorate) the School for Registration.
k) The Commissioner for Education (Inspectorate) using information
and documents attached on to the application form, or a report based
on physical inspection of the School by the Central Inspectorate, may
reject the application and give reasons for doing so to the proprietor,
or recommend to the Commissioner for Education the award of a
Registration and Classification number.
l) All licenses and registration certificates are entered in the
relevant registers kept by the Commissioner for Education.
Applications for license will be dealt with between June - December
preceding the year of operation.
m) A School may be de-licensed or de-registered in cases of
noncompliance with the regulations governing the operations of private

29
 Project Proposal/Business Plan Corporate Document

schools in accordance with the Education Act (1970) by the

Commissioner for Education.

8.3 Admissions and Classes

Admissions to St. James Nursery and Primary School are usually

done by interview with the Headmaster. Class size [per stream] will be
limited to 35 students generally. This size allows individual attention
for students and helps ensure the highest standard of education. Up to
62.5 percent [about 350 students] of the school’s student population
are expected to be boarders.

8.4 Management and Staffing

The school has a board of trustees consisting of all the shareholders as

founder members of the school. The responsibility of the council is to
ensure that the school is managed in accordance with the aims and
objectives for which it was established.

There is a Board of Governors as mandated by the government. It is

the supreme policy making body responsible for ensuring efficient and
effective management of the school. It is charged with the
responsibility of making decisions relating to staff recruitment,
discipline of staff and students and general development of the school.
It consists of nine members including the headmaster, parents’
representative, students’ representative, teachers’ representative,
Ministry of Education representatives [2], a local dignitary, the main
sponsor and the school bursar.

The Headmaster is responsible for the day-to-day operations of the

school, recruiting and recommending staff, liaising with parents,
education officers, and admitting students. The Headmaster is assisted
by two Deputy Headmasters, one responsible for academics and the
other in charge of general administration. The deputy
Headmaster/academics is responsible for planning, controlling and
coordinating all the academic activities. The Deputy
Headmaster/administration is responsible for planning and controlling
all the activities of non-teaching staff and employees.

All the teachers are locally recruited. Good qualified and experienced
teachers are available. The remuneration offered is good enough to
attract quality teachers. At full operation there will be a total of 20

30
 Project Proposal/Business Plan Corporate Document

teaching staff. The complete staffing requirements for both academic

and non-academic staff are shown in Table 4 and the Organization
Chart in Figure 3 below.

Table 3: School Manpower and Emoluments [Year 1]

Total Total
Positions Number Salary/Head/Month Monthly Annual
[USD] Salary Salary
[USD] [USD]
Faculty Members:
Director of
Students 1 270 270 3,240
Teachers 16 160 2,560 30,720
Computer
Instructors 2 160 320 3,840

31
 Project Proposal/Business Plan Corporate Document

Administrative
Staff
Director 1 540 540 6,480
Headmaster 1 340 340 4,080
Deputy Headmaster 2 270 540 6,480
Administrator 1 240 240 2,880
Bursar 1 131 131 1,572
Secretary 1 95 95 1,140
Matrons 2 95 190 2,280
Copy Typist 1 60 60 720
Maintenance
Staff
Office Attendant 1 50 50 600
Driver 1 61 61 732
Turn Boy 1 50 50 600
Caterer 1 131 131 1,572
Cooks 4 50 200 2,400
Waiters/Dining
Staff 3 45 135 1,620
Classroom Cleaners 6 45 270 3,240
Compound Cleaners 6 45 270 3,240
Armed Guards 2 45 90 1,080
Total: 54 78,516

32
 Project Proposal/Business Plan Corporate Document
Figure 3: St. James Nursery and Primary School Organization Chart
31
 Project Proposal/Business Plan Corporate Document
Location and Infrastructure

The school is located on a 0.9 ha. [2.25 Acres] site in Mpala Village, Kitala
Parish, Katabi Sub-County. The school is situated on the Mpala-Bubuli
road off the Kampala–Entebbe main road at Mpala near Seventh Day
[SDA] Church. The school is exactly located on the village road to Bubuli –
and a few metres from Mpala Trading Centre towards Kampala and opposite
the road to Lyamutundwe village.

The plot on which the school sits is registered as a District Lease in the
names of St. James Nursery and Primary School Boarding Primary
School. The land title is unencumbered and is available as collateral. The
size and topography of the site are suitable for the project. The site is
spacious enough to accommodate the new structures and building
extensions that are being proposed in this plan.

The area has adequate water supply, but being a rural location in Uganda it
lacks an electricity grid network. A solar power unit will be set up at the
school to provide regular electricity supply and an electricity generator set
will be purchased and used as a standby power supply source. Sewage
treatment will be to a septic tank.

8.5 Buildings and Other Infrastructure

Table 5 below provides a summary on the existing and planned building

infrastructure at St. James Nursery and Primary School.

Table 5: Existing and Planned Building Infrastructure at St. James

Nursery and Primary School
EXISTING PLANNED/PROPOSED
 2 Classroom Blocks of 3 Classes  2 Dormitory Blocks
+ 1 Dormitory Room each

 1 Classroom + Staff Room  1 Library

 1 Admin. Block/Library  1 Computer Lab
 1 Sick Bay Block  1 Headmaster’s Office
 1 Kitchen  1 Staff Room
 1 Store  1 Kitchen + Dining Hall
 1 Sanitary Facilities structure  4 Staff Accommodation Units
 4 Recreation Hall
 1 School Clinic/Domiciliary

35
 Project Proposal/Business Plan Corporate Document
 1 Underground Water Tank
 1 Tools/Spares Store
 1 Gate House
 1 Sports Field/Playground
The construction of all buildings will be the same, comprising of reinforced
concrete frames with concrete block work walling rendered and plastered.
Roofing will be of corrugated iron sheets on wooden trusses. Windows will
be of plain louvers in timber sub-frames fitted with burglar proofing. Doors
will be of paneled timber shutters.

8.6 Sports Facilities

A Playground [100 x 150 metres] will be leveled. Various games including

athletics will be held on this ground.

The school will be constructed in such a manner as to offer a beautiful

pleasant environment while controlling construction costs.

8.7 Equipment, Furniture, Fixtures

Standard classroom and dormitory equipment and furniture will be

purchased. Textbooks, scholastic materials, computers, kitchen equipment,
sports equipment, dining cutlery and office equipment will also be
purchased. Most of the items will be purchased locally.

8.8 Vehicles

St. James Nursery and Primary School requires an 8 MT Fuso Truck for
the day to day transport needs of the school and other general purposes.

36
 Project Proposal/Business Plan Corporate Document

9.0 PROJECT TIMETABLE

The school currently operates from within the precincts of its own plot of
land [0.9 ha.] which it deems adequate for the planned expansion
programme to its existing infrastructure and facilities. This land is large
enough to accommodate the additional structures as planned and
comfortably cater for 560 students as planned.

The project implementation schedule is as shown in Figure 4 below. For the

project to be fully implemented and completed, financing must be firmed up
by January 2009, and all equipment must be procured and delivered by
April 2009. Building construction work is expected to take 8 months to
complete [i.e. February – September 2009]. The various activities are
expected to proceed as follows:

Activity Timing

Negotiate for finance June 2009 - August 2009

Financing documentation September – October 2009
Order equipment November 2009
Delivery of equipment December 2009 – January 2010
Installation February 2009
Building Construction September 2009 – April 2010 Figure 4:
Project Implementation Plan

ACTIVITY/TIME Jun Jul Au Sep Oct No Dec Jan Feb Ma Apr

SCALE 20 20 g t 20 v 20 20 20 r 20
08 08 20 20 09 20 09 10 10 20 10
09 09 09 10
Negotiate for
finance
Financing
documentation
Order equipment

37
 Project Proposal/Business Plan Corporate Document
Delivery of
equipment
Installation
Building
Construction

10.0 ENVIRONMENTAL CONSIDERATIONS

The expansive construction of the school will be subjected to environmental

review as it has a Category B classification according to the World Bank’s
guidelines on educational establishments. Planning approvals by Ugandan
authorities to proceed with the plan’s implementation has already been
granted. There are no objections to this development from the neighbouring
communities. The principal environmental aspects of the project are as
follows:

Land Clearing

Since the school is actively using the site, it had to be cleared and levelled
at first. The bushes covering the site were cleared prior to construction of
the exiting buildings. Lawn grasses have been planted in the school
compound and various tree species have also been planted.

Water and Sewage Treatment

38
 Project Proposal/Business Plan Corporate Document
The school presently draws its water supply from dams located about 4 kms
away from the school. A borehole to provide water during emergency will be
set up. Arrangements have also been made to harvest rain water from the
roofs of the buildings and store it in an underground tank, which is yet to be
constructed at the site. For sewage treatment, septic tanks [VIP Stance
latrines] will be constructed. These facilities will be adequate for the school.

Garbage Disposal

Garbage generated by this development will be classified and divided into

general domestic garbage and kitchen waste. These will be stored in
designated areas, within waterproof bins and disposed off as effectively as
possible to the land fill site.

Hazardous Substances and CFCs

All refrigeration units to be bought will be free of CFC gases. No hazardous

waste products or emissions are expected to be associated with this
development.

Power and Water Supply

The current supply of water to the development is not all that satisfactory.
To solve this perennial problem, a water reservoir will be installed. A Solar
Power Unit will also be installed to supply constant electric power to the
school. A standby diesel generator of 40 kVA will also be installed for
emergency.

Fire Protection

The development will put in place an adequate fire protection system.

Portable fire extinguishers as well as fire hoses connected to the main water
supply will be installed. The extinguishers will be regularly inspected.

Health and Safety

The management of the school is well aware of the need for international
standards of health and safety. The Entebbe Regional Referral Hospital
is only just about 6 kms away as well as several local clinics at the nearby
trading centre of Abayita-ababiri and Entebbe municipality. The school will
identify a resident doctor who will always be on hand to provide emergency
services when required.

39
 Project Proposal/Business Plan Corporate Document

11.0 PROJECT COST AND FINANCIAL PLAN

11.1 Estimated Project Cost

The total project cost is estimated at US$ 492,094 [UShs.

1,058,001,600]. The breakdown is shown in Table 6 below.

Table 6: Breakdown of Project Costs

Existing Additional Total Total Project

[US$] [US$] Project Cost [UShs]
Cost [US$]
Land 46,512 0 46,512 100,000,000
Buildings, infrastructure 69,767 237,098 306,865 659,759,750
Equipment facilities 1,395 19,442 20,837 44,800,000
Furniture, fixtures.
Fittings 20,000 21,060 41,060 88,279,000
Vehicles 0 11,628 11,628 25,000,000
Books + Scholastic
materials 2,326 10,773 13,099 28,162,850
Pre-operational
expenses 0 37,209 37,209 80,000,000

40
 Project Proposal/Business Plan Corporate Document
Working Capital 0 14,884 14,884 32,000,000

TOTAL PROJECT COST 140,000 352,094 492,094 1,058,001,600

The total cost of the additional expansion-phase of the project is US$

352,094. The cost of building construction is based on a recent valuation.
Costs of equipment, furniture and other goods are based on supplies
quotations. Copies of relevant documents are included in the Appendices.
Contingencies are included in the cost estimates.

11.2 Proposed Financing Plan

The proposed financing plan is provided in Table 7 below.

Table 7: Proposed Financing Plan

Existing Additional Total % Total Cost

[US$] [US$] Project
Cost [US$]
Promoter’s Equity 140,000 52,094 192,094 39.02
Long Term Facility 0 300,000 300,000 61.98

TOTAL FINANCING 140,000 352,094 492,094 100

The project promoter has already contributed US$ 192,094 in the form of
existing assets such as land, land development, existing school structures,
some equipment, furniture and various pre-operational costs. A long-term
loan of US$ 300,000 [UShs. 645 million] is sought from the donor
institutions. The project promoter has undertaken to provide some
additional cash to cover possible cost overruns or other charges.

41
 Project Proposal/Business Plan Corporate Document

12.0 PROFITABILITY AND FINANCIAL CONDITION

Financial projections for St. James Nursery and Primary School have
been prepared and are summarized in Table 8 below. [Details of the
financial projections and assumptions made are shown in Annexes 1-7].

Table 8: Summary of Financial Projections

As at year ending December 31

2010 2011 2012 2013 2014 2015 2016 2017 2018

US$ 000’s

Income 283.5 307.3 331.1 354.9 378.7 402.5 426.3 450.1 473.9
Gross

42
 Project Proposal/Business Plan Corporate Document
Profit 109.98 121.18 131.35 140.41 148.26 154.80 159.89 163.41 165.23
Operating
Profit 99.12 110.30 119.93 128.42 135.67 141.57 146.00 148.83 149.92
Net Profit
[Loss] 26.47 34.30 41.04 50.48 59.06 70.59 76.49 81.27 84.83
Gross
Margin 38.79 39.43 39.67 39.56 39.15 38.46 37.51 36.31 34.87
% % % % % % % % %
Operating
Margin 34.96 35.89 36.22 36.18 35.82 35.17 34.25 33.07 31.63
% % % % % % % % %
Net 9.34% 11.16 12.39 14.22 15.59 17.54 17.94 18.06 17.90
Margin % % % % % % % %

Current
Ratio [:1] 31.12 41.11 3.79 4.20 5.98 6.55 7.54 8.61 9.65
Net LT
debt/equit 1.15 1.04 0.91 0.63 0.42 0.27 0.16 0.069 0
y ratio
[:1]
LT debt
service
coverage 3.3 3.68 1.5 1.71 2.26 2.53 2.81 3.10 3.41
ratio [:1]

12.1 Profitability

Company Profitability. The company is expected to be profitable from

year one. Thereafter, net profits will increase.

Expected Rate of Return on Total Project Investment. The expected

internal rate of return [IRR] after tax, on total project investment is
approximately 39% per year.

Expected Rate of Return on Equity Investment [ROE]. The proposed

equity investments are expected to earn a return of approximately 23% per
year in real terms, assuming all excess cash is distributed to shareholders.
The rates of return are acceptable and adequate in the educational sector.
Other projects in the sector have registered the same rates.

43
 Project Proposal/Business Plan Corporate Document
12.2 Company Financial Condition

The company is expected to show a strong financial position throughout the

projected period. Cash flows will be adequate to cover both short and long
term liability commitments, and the long-term debt service coverage ratio
will be greater than 1.5 throughout the repayment period. The company is
expected to pay dividends from the first year of operation.

12.3 Sensitivity Analysis

The assumptions on which the financial projections are based reflect current
conditions. A sensitivity analysis of the project has, however, been carried
out to examine the impact of possible changes in critical variables on the
company’s performance. A summary of the sensitivity analysis is shown in
Table 9 below and the full details are presented in Annex 7H.

Table 9: Sensitivity Analysis

DSCR

Change IRR ROE 2010 2011 2012 2013

Sensitivity Case
Base case 39% 23% 3.30 3.68 1.5 1.71
Operating Costs +10% 36% 17% 2.62 2.94 1.2 1.38
Fees/revenues -10% 24% 14% 2.29 2.58 1.06 1.21
Enrollment build-up -5% 31% 19% 2.76 3.09 1.26 1.44

The sensitivity analysis shows that the project is most sensitive to changes
in school fees, enrollment and costs. Enrollment will be achieved since the
school already has 200 students. Under most conditions the project will
remain viable, meet its financial commitments and continue to provide an
acceptable return to the investors.

13.0 DEVELOPMENT AND SOCIAL IMPACT CONSIDERATIONS

The project will:

44
 Project Proposal/Business Plan Corporate Document
• Provide top quality primary school education to approximately 560
pupils each year;

• Increase the involvement of the private sector in the provision of

social services;

• Help reduce overcrowding in government-aided schools;

• Create employment for 54 people.

45
 Project Proposal/Business Plan Corporate Document
14.0 SPECIAL FEATURES, RISKS AND ISSUES

Low Risk

The project has a relatively low risk of failure because of the strong demand
for private education facilities in Uganda and the educational and business
strengths of the sponsors. With increasing population and the subsequent
overcrowding at government-aided schools, demand for private schools is
expected to grow substantially in the coming years. With the facilities being
provided at St. James Nursery and Primary School and this being an
existing school, maintaining full enrollment should not be a problem.

Financing

Historically, banks and other financial institutions have been reluctant to

provide long term finance for education for education or other ‘social
infrastructure projects’. As government have not been able to cope with the
pace of demand for social services in Uganda, more and more non-financial
institutions have shown a growing interest in picking the tab for these
activities because the public demand and willingness to pay for these
services have increased dramatically. In Uganda today, a well-planned
educational project can be considered a sound commercial investment and
an investments in the nation’s development.

Management

The good set-up of the school has depended on the experience of the
principal promoter Mr. Robert Serunkuma in education and business
management

46
 Project Proposal/Business Plan Corporate Document

15.0 KEY ASSUMPTIONS

15.1 Financial Assumptions

Interest Rate on
Long Term Loan 10%
Project Financing
Equity 39.04%
Debt 60.96%
Long Term Loan Repayment [Yrs] 9

15.2 Revenue Assumptions

[a] Boarders [350 No.]
Annual Change in Fees Rates Total Annual Fees Revenues
[US$]
1. At US$ 630/Pupil/Year 220,500
2. At US$ 680/Pupil/Year 238,000
3. At US$ 730/Pupil/Year 255,500
4. At US$ 780/Pupil/Year 273,000
5. At US$ 830/Pupil/Year 290,500
6. At US$ 880/Pupil/Year 308,000
7. At US$ 930/Pupil/Year 325,500
8. At US$ 980/Pupil/Year 343,000
9. At US$ 1,030/Pupil/Year 360,500

[b] Day Students [210 No.]

Annual Change in Fees Rates Total Annual Fees Revenues
[US$]
1. At US$ 300/Pupil/Year 63,000
2. At US$ 330/Pupil/Year 69,300
3. At US$ 360/Pupil/Year 75,600
4. At US$ 390/Pupil/Year 81,900
5. At US$ 420/Pupil/Year 88,200
6. At US$ 450/Pupil/Year 94,500
7. At US$ 480/Pupil/Year 100,800
47
 Project Proposal/Business Plan Corporate Document
8. At US$ 510/Pupil/Year 107,100
9. At US$ 540/Pupil/Year 113,400

15.3 Miscellaneous Assumptions

Salaries growth rate 10%

Expense growth rate 5%
Depreciation on: [Written Down
Value]
Buildings 5%
Furniture & Fixtures 10%
School & Office Equipment 10%
Vehicle 20%
Preliminary Cost 5%
Tax Rate 30%
Cash in Hand [Days] 30

48