BUSINESS PLAN

NAME OF THE BUSINESS: Manos Computer and Research Training Center

INSTITUTION: Mabera Technical and Vocational College

NAME OF THE CANDIDATE: Enock Magere
INDEX NUMBER: 74800/002
COURSE CODE: 1920
UNIT CODE: 1920/107
CENTER CODE: 748001
SUPERVISOR: Lillian Anyango
PRESENT TO: KNECTHIS PROJECT DOCUMENTATION HAS BEEN SUBMITTED IN

PARTIAL FULFIMENT OF THE REGURATION GOVERNING A WORD OF

CERTIFICATE IN INFORMATION COMMUNICATION TECHNOLOGY

SERIES: July
DECLARATION:
Computer and research training center has been developed and printed by Enock Magere of
Mabera Technical and Vocational College as a practical fulfillment of the Kenya National
Examination Council (KNEC) and designed as a Business plan, For the aword of Certificate in
Information and Technology.
Submitted by:
NAME........................................................................
Signeture....................................................................
Date...........................................................................

This business plan has been submitted for Kenya National Examination Council with the approval of my
supervisor's name.
Approved By:
SUPERVISOR`SNAME..........................................................................................
Signeture.........................................................................
Date….............................................................................
AKNOWLEDGMENT
My special gratitude goes to the lord Almighty God for His grace guidance for enabling me to complete
this project in time and given me sound mind and health. I am also thankful to the following individuals
who have given me their fully support and advice during the development of my project; my teacher
Madam Lillian, my friends and class members.
Also without forgetting my project supervisor Madam Lillian for constant guidance and diligent support
during the period of the project.
DEDICATION
I dedicate this business plan to my beloved parents, my business plan teacher Madam Lilian, my sisters,
my friends and my high school teacher Madam Wilkister. They have stood besides me all the time since I
started this business plan at good time and bad time.
EXECUTIVESUMMARY
Manos computer and research training center will be my business which will be located in Mabera Sub-
county at kubweye village which will be 200metres from Mabera town. The outlet of my business will
provide facilities to enable clients conducts their research efficiently. After a number of years it will be
reconfigured to a partnership. The nature of computing world in the industry and education sector has
created a constant need for business skilled in updating and advising customers with a very flexible
schedule to meet their need. The business will require ksh. 2 millions and a loan of ksh. 1 million for the
research and steady ready for use. The owner's forecast based on market and industry to ensure there is
a constant growth of the outlet by maximizing the profits.
CHAPTER ONE: BUSINESS DESCRIPTION

1.0. INTRODUTION
The business description is an aspect of many business plans that combine the key details of my
company that will provide services and good to clients. They include;
 Business name
 Business location
 Business address
 Business contacts
 Form and type of ownership
 Product and services
 Justification of the business
 Industry and services
 Business goals and objectives
 Entry and strategy

Business name
My business name is Manos Computer and Research Training Center. The major services
that will be carried will be basically research and training through its people that will be
up dated on daily basis and gain their required knowledge or information.

Business location
My business will be located at Kubweye, 200metres (M) from Mabera town. This will be
located to the opposite side of Mabera Technical and Vocational Collage. The town and
the collage contain many people that help the business to grow faster from the rich
market available.
Business address
The following is my business address that is always available;
MANOS COMPUTER AND RESEARCH TRAINING CENTER,
P.O BOX 205,
ISIBANIA.
1.1. BUSINESS CONTACT PHONE NUMBER
TEL. 0758503435
EMAIL. [email protected]

Form and type of ownership

The form of ownership is sole proprietorship. The following are the advantages and
disadvantages that can hinder my business plan.
Advantages
 Easy to raise capital
 My business enjoy shall the profit
 My business has personal contact with employees and customers
 Business make independent decision to complete over the business is solely responsible
for all decisions in the business.
 Flexibility of my business is able to respond quickly to business needs in day-to-day
management
Disadvantages
 Capital basis may be limited to my business due to less financing capacity
 Bears all the loses
 Success of the business depends on the entrepreneur’s hard work.
 Business operation can be affected by death of the owner.

Product and services

Product to be sold will include:
 Mobile phone and its accessories
 Micro process
  Personal computers
 Fiber optics
Services to be provided will include
 Explore research at Microsoft
 Reach along with publication and product
 Research on downloads and research careers
 Online research through technology

Justification of the business

There as on as to why I chose to establish this business and place it is because it is basically on
training people around. Due to the service that would be offered, it will attract many people and
my business will be successful. The place is suitable because there is good security around the
place and population is higher because of nearest market thus providing already market due to
the following reasons:
 Some competitors are not well equipped with the skills and knowledge required to carry
out such a business.
 The competitors lack modern equipment hence that makes their business to be
incomplete.
1.1. Industry
The kind of business that I am venturing into falls under the industries, it majors on computer
research in modern technology. Some of the characteristics of this industry are;
 Work flow facilities
 Applications designed
 Development designed
Due to challenges there is lack of sand experience for adjustment of reaching the area thus with
appropriate skill that have gained they will be able to do away with failures but to meet their
expectation.

Business goals and objectives

My business has goals to achieve and some areas are as follows;
 Maximizing profit and satisfying customers.
  Providing the best and quality services to customers.
 To be an intellectual and social asset to the community and environment.
 Winning customers to be self-reliant.
 Copying with market demand after one year of the start.
1.2. Entry and growth strategies
Entry strategy
Some of the key factors that will consider as part of my entry strategy will include;
 Creating public awareness through marketing.
 Collecting illegal documents required.
 Offering low prices than the competitor to attract and win client.
 Offering discount to customers who requires more services.

Growth strategy
Growth and good plan for the business shall depend on the demand of the services rendered by
the business to the customers. The business is intended to grow and expand to become a
partnership business. The following are steps to accommodate the customer ethics;
 Having a well-organized working site
 Ensuring and maintain proper cleanliness
 Being punctual with resource and finance
 Checking and taking duties seriously.
CHAPTER TWO: MARKETINGPLAN.

Introduction
This chapter shows the market strategies of MANOS computer and research Centre as follows;
 Potential customers.
 Market share and size.
 Completion promotion strategy.
 Prices strategy sale statistics.
 Distribution strategy.

Potential Customer
In my business, I am targeting the individual institutional like Kubweye primary school,
Kubweye secondary school, Mabera Technical and vocational college, Mabera primary school
and other institution. The business mostly targets the youths and outstand middle aged people. In
considering the customer preferences, I will listen to my customers complains and also find the
way to help them. In order to understand what they like and dislike by asking them questions and
observing them on their daily work, through getting this information it will guide them on how to
be more accurate and give out what is required. My clients also want good product and services.

Market share and size

I have decided to start my business near the town where by I found the population of Kubweye is
about 35876 and the number of population that I have targeted is about 28586. The chart below
shows the market share before starting and after starting.
 Before After

MANOS
Computer and
Research
John’s research Centre Computer =79.68%

Johns research Centre

=20.32%

Market=No. of expected customer*100

Overall

28586*100%
35876

COMPETITION
Due to existence of other computer research center in my area, I will make sure that I provide
good skills and knowledge to the trainers. The major competitor is John’s computer and research
Centre in Mabera town , which is widely spread and known in the town.
He has good relationship with the customer but he has some failure like;
 He offers unsatisfactory goods and services to client.

To outdo my competitor I will be:

 Opening from7.00am-8.30pm.
 Offering satisfactory goods and services.
Collection views from customers to ensure that the inquiries are accomplished.

PROMOTIONSTRATEGY
My businesses will goal the way to adopt and apply best practices to promote my business.
Which offer goods and services at a lower price to win my customers? And even it will be
conducted using billboards, road shows and posters in different places. It will indicate the
location, goods and services offered and the corresponding price.
My business will;
 Offer low prices than the competitor to attract and win client.
  Offering discount to customers who require more services.
 Creating public awareness though marketing.
 Having a well-organized working site.

PRICESSTRATEGY
The business would employ various methods that would be used to promote my business. The
promotion would ensure that my good share brought on a high range.
Discount charges will be charged on any product to be sold will include;
Packages Price per packages
Fiber optics @500
Microprocessor @1000
Mobile phones @3000 and above
Personal computer @15000

SALESTACTICS
Manos computer and research center sales and marketing team will be recruited based on
experience in the industry and I will be training them a show to work so as to be equipped to
meet the overall goals of my business. My aim is to make research on the online services in
Kubweye.
DISTRIBUTIONSTRATEGY
The business will be operated on a direct channel of distribution which will be very short without
middle men involved from the wholesales. They will be moving direct to my business. I will use
vehicles which will be mostly used to distribute my goods through reducing transportation cost
of my client.
The Problems that are likely to be met are as follows;
 Poor services.
 Low quality products.
 Poor infrastructures.
CHAPTER 3: ORGANIZATION PLAN

3.0 INTRODUCTION
In the organization of my outlet, several individuals with good qualifications that suit with the
business that I may employed. The employees shall take the responsibilities that shall be given
unto them. Those into position will guide and control those below them in the operation of the
business.

3.1 ORGANIZATIONSTRUCTURE
At the start up my business will take up the organization structure style as in the chart below

Manager

Marketing manager Deputy Manager

Cashier Security officer

3.2 BUSINESSMANAGERANDQUALIFICATION
The business will be headed by the;
 Manager
 Deputy manager
 Marketing manager
 NO. Title DUTIES QUALIFICATION
1 Manager  Making decision  Time management skill
 I will determine and pay salary to  Mentorship
employees  Problem solving capability
 I will control business operations  Leadership mentality
2 Deputy  Attending meetings and preparing  Effective communication skills
Manager detailed reports  Performance management
 Acting in the place of the manager  Understand regulatory
when they are not available. management
 Assisting manager in making  Supervisory and team leadings
important decision regarding kills
management procedure
3 Marketing  To promote business, products or  Strong product management
Manager services  Excellent written and verbal
communication skills
 Bachelor’s degree in marketing,
business

3.3RECRUITMENTTRAININGANDPROMOTION

3.3.1 RECRUITMENT
It will be done by identifying the right and qualified candidate for the outlet. The different ways
to identify the qualified candidate include;
 Interviewing both oral and written
 Looking at the certification on application to know the level of education
 Physical examination and medical examination to understand the health status.
This is also aimed at evaluating the performance of the employee resulting to promotion of the
test and demotion of some who did not do well. It is also aimed at improving the production of
the outlet.

3.3.2 TRAINING
Training will make workers familiar with the work assigned to do and give them basic skill such
as communication skill, public relation and business skill. This will be done purposely for
employees to have some skills and knowledge to goods and services and how to maintain
facilities available. The training will also enable them to;
 Have confidence when dealing with customers.
 To lean from competitors mistake in order to help correcting the outlets mistake.
 Get ideas from others especially sales representatives’ distributors, suppliers and
competitors.
After realizing their weakness, they will be exposed to professional training where they will be
taken to workshops and seminars to equip them with required knowledge.

3.3.3 PROMOTION
Any employees who will work hard towards the success of the outlet shall be rewarded and
promoted. By doing this there will be competition among them. Any end part shall be organized
in the premises. The best potential customers shall also be invited to the party.

3.4 LICENSEANDBY-LOWS
3.4.1 LICENSE
License allows all the business to operate within the town center. It will be obtain at Sirari border
municipal council, licensing office opposite to KCB Bank. The license shall goat ksh.1500 and
will be renewed in a yearly basis.
3.4.2 BY-LAWS
It is an act of parliament of the republic of Kenya that guides employee relationship by stating
employees must be a majority age, sound mind and willing to work. The employer shall provide
sick leave, annual leave and compassionate leave employee when need arises. This act will bring
discipline between the employers and employees that ensure quantity required by customers.

3.5 RENUMERATION AND INCENTIVES

3.5.1 RENUMERATION
The out let shall use the following remuneration.
 Allowances; all employees shall enjoy transport and medical allowances of Ksh.1000 for
each employee.
 Salary scheduling; the salaries shall differ with the position and responsibilities.
 S/N PESONNEL MONTHLYPAYW ALLOWANCES NETPAY(K
ITHOUTALLOWA (KSH) SH)
NCES
1 Managing Director 20,000 1,000 21,000

2 Deputy Managing Director 10,000 1,000 11,000

3 Marketing Manager 5,000 1,000 6,000

4 Cashier 3,000 1,000 4,000

5 Security Officer 2,000 1,000 3,000

TOTAL 40,000 5,000 45,000

3.5.2 INCENTIVES
The employees shall have following incentives in business as a way of motivating them;
 Off duties and leaves; each employee shall accept the security officer and cashier shall
give off duties every two weeks a day once a year.
 Parties; there shall be annual party and the best customer shall be invited.
3.6 SUPPORTIVES PROFFESSIONAL AND SERVICES
The outlet shall lie on the following supportive services for its successful operation;
 Banking
The ventured business I will need to open an account that will help me to save profit amount
obtaining from the business for future use. I will open an account with KCB bank.
 Insurance
When the outlet will have grown it will ensure its premises are against fire and the risk.
Will ensure services and repair after against to identify so that to save guard them thought the
operation formed by shield insurance company.

CHAPTER4

Operation/Product Plan

4.0 Introduction
In this chapter my product plan will work under the following features
 Product or service design development
  Production facilities and capacity
 Production or services strategy
 Production service process
 Element affecting production operation
 Equipment of materials

4.1 Services Design Development

Service design is the process of creating touch points and defensing how they interact with each
other and the user. The company will use design tools and methods to deliver an in depth
understanding of user behaviors, their like and their needs which can enable new solution to be
developed. The services that will design my computer will be as follows;
 Online research through technology.
 Research on downloads and research careers.
 Explore research at Microsoft.
 Research along with publication and product.

4.1.1 Service Development

My company will need to go through the development phase in services provided. The
development phase in my research will be organizing and planning of the project. The budget
must be set cast goes through audition the location and multiple scripts rewritten

4.2 Production Service Strategy

The business will offers services in my business premises mostly that are deliveries of our
product like online services, register books will be done manually. The services that will be
conducted in the premises will be regularly. The set time for opening and closing of the business
is 7:30a.m to 8:00p.m. And also there is a lunch break at 12:30p.m to 1:30p.m.

4.3 Production Facilities and Capacity

These are equipment of any building used for the purpose of producing services in a given
origination. The capacity of computer research center will be the upper limit of the abilities of
one part of my business. The facility that will require computers will be in the office. The table
below shows the facilities and capacity of computer and research center.
Item Capacity Quantity Cost
Offices 2 rooms 5 units 20,000
Electricity room 1 room 2 units 10,000
Toilets 2 rooms 5 units 5,000

4.4 PRODUTION SERVICE PROCESS

The business has the following set standards to enable it to achieve the goals.
 The business will be intended to provide services or its products on transparent window
and prices will be attached to the products.
 The business will ensure that the products are worthy service.
 The workers will be wearing uniform with label off the business name and logo.
 The services and product will be arranged according to qualification and they will be
clearly indicated precaution and how to use them.
 The manager will be in charge of the quality control in the business.

4.4. LABOUR CONTROL

The following statement shows how it controls;
 The business will employ five employees for the effective running of the business.
 The employees will be recruited with regard to their qualification.
 The manager will be required to have a diploma in it and also sales and marketing.
 The watchman will be at least eighteen years and above

4.5 Equipment of materials

These are electronic equipment that broadcasts or services electromagnetic waves representing
images and sound. The company will have the following equipment to succeed in the computer
research center.
 Item Quantity Capacity Cost Ksh Maintenance Ksh
Computer 3 1unit 15,000 1,000
Mobile phone 5 1unit 7,000 800
Fiber optics 2 1unit 10,000 1,000
Tables 3 1unit 5,000 500
Chairs 5 1unit 5,000 500

Element affecting Production Operation

Environmental act
Under the environmental act of Kenya which guarantees the right to clean and healthy
environment and requires the environment to protect the present and future generation. My
business will ensure that the environment is managed accordingly, through focusing on keeping
it clean as possible.
Employment act
Under employment act of Kenya and regulation of Manos and conditions of employment act, my
business will ensure that the employed workers strictly follow the rules and regulation containing
in the employment act hence the production of good service
Building regulation
The business will provide enough for workers and customers good furniture, enough light proper
ventilation inside the room and the floor will be covered with carpets to prevent dust from
entering into the keyboard and other parts of the computer.

CHAPTER FIVE

5.0 FINANCIAL PLAN

5.0.1 Financial Plan

This phase will enable the proprietor to know the financial aspect of the proposed business and
help him to gauge the future financial.

5.0.2 Books of Accounts

The following are books of account, which shows the business transaction and also shows the
business assets and liabilities.
  Cashbook: this will show records of cheek and cash money received and spent.
 Purchase: they will include materials and equipment’s which will be bough to very
given period of time.
 General Ledger: they will show records for all bills e.g. salaries, rent and electricity.
 Journals: this is the entrance of all dairy transactions which take place in the business.

2 Summary of Pre-operational Cost

Item no Item Amount
1 Loan processing fee 150
2 Bank account(opening) 1000
3 Electricity(advance 2000
payment)
4 advertisement 2000
6 Insurance 2500
7 Miscellaneous fees
8 Travelling expense 3500
2000
3000
Total 16150

5.1Estimate of Working Capital

Item no Item Amount
Ksh.
1 Opening stock 65000
2 Salaries 8000
3 Traveling expense 2000
4 Advertisement and promotion 1000
5 Insurance 1000
6 Stationary 1000
7 Rent 4000
8 license 3000

Total 83000
Total estimate of working capital is Ksh.83000

5.2Estimate of fixed assets

Item no Item Amount Ksh.
1 Furniture 8000
2 Stirring stick 1000
3 Fridge 1000
4 Cooker 60
5 Binder 5000
6 Scissors 2500

Total 17560

5.3 CASH FLOW PROJECTIONS

CASH FLOW PROJECTION YEAR 1
PART JAN FEB MA AP MA JUN JU AU SEP OC NO DE TOT
ICUL R R Y L G T V C ALS
ARS
Cash 2000 2300 2000 230 2000 2300 200 2300 2000 2300 2000 2300 25800
sales 0 0
Collec 200 200 200 150 150 100 200 200 200 150 150 150 2,000
tion
from
debtor
Bank
from
debtor
Sale 5,000 2,00 200 1,0 1,00 1,00 1,0 500 500 500 500 500 15,50
of 0 00 0 0 00 0
assets
scrap
Grant 300 500 400 300 200 400
s
donati
ons
Totals 5,900 5900 5,90 4,4 4,55 3,40 1,4 4,40 4,40 2,75 2,90 2,90 44450
cash 0 50 0 0 00 0 0 0 0 0
inflow
Cash
out
flow
Purch 19,80 1980 19,8 19, 19,0 18,0 17, 18,5 19,5 19,0 18,5 18,0 226,7
ases 0 0 00 000 00 00 000 00 00 00 00 00 00
Salari 8000 8,00 8000 800 8000 8000 800 8000 8000 8000 8000 8000 96,00
es 0 0 0 0
Rent 4,000 4000 4000 4,0 4,00 4,00 400 4,00 4000 4,00 4000 4000 48,00
00 0 0 0 0 0 0
Trans 100 100 100 100 100 100 100 100 100 100 100 100 12,00
port 0
Licens 3,000
e
Adver 1000 1000 1000 100 1000 1000 100 1000 1000 1000 1000 1000 12,00
t 0 0 0
(poste
rs)
Insura 1000 1000 1000 100 1000 1000 100 1000 1000 1000 1000 1000 12,00
nce 0 0 0
Prom 5,500
otions
Loan 2,000 2000 2000 200 2000 2000 200 2000 2000 2000 2000 2000 24,00
payme 0 0 0
nt
Statio 100 100 100 100 100 100 100 100 100 100 100 100 1,200
nary
Miscel 200 200 200 200 200 200 200 200 200 200 200 200 2,400
laneou
s
Total 85,10 75,6 75,2 74, 74,0 73,4 72, 73,9 75,2 74,4 73,9 73,0 901,5
cash 0 00 00 400 00 00 400 00 00 00 00 0 00
outflo
w
Net 5,800 6030 60,6 60, 59,9 60,1 58, 60,5 58,5 58,9 5835 5950 71425
cash 0 95 5 5 50 0 0 5
Cumu
lative
Cash 53,80 114, 174, 234 294, 354, 354 413, 532, 591, 650, 709, 6509,
outflo 0 100 700 ,75 700 880 ,88 350 950 300 150 650 650
w 0 0

CASH FLOW PROJECTION FOR YEAR 2

PART JAN FEB MA AP MA JUN JUL AU SEP OCT NO DEC TOT
ICUL R R Y G V ALS
ARS
Cash 135,2 135, 135, 135 135, 135, 133 135, 135, 133, 133, 133, 1,612,
sales 00 200 200 ,20 200 200 ,20 200 200 200 200 200 000
0 0
Collec 200 200 200 150 150 100 200 200 200 150 150 150 2,000
tion
from
debtor
Bank
from
debtor
Sale 5,000 2,00 200 1,0 1,00 1,00 1,0 500 500 500 500 500 15,50
of 0 00 0 0 00 0
assets
scrap
Grant 300 500 400 300 200 400
s
donati
ons
Totals 135,9 1359 135, 134 134, 133, 131 134, 134, 132, 132, 132, 1,611,
cash 00 00 900 ,45 550 400 ,40 400 400 750 900 900 450
inflow 0 0
Cash
out
flow
Purch 19,80 1980 19,8 19, 19,0 18,0 17, 18,5 19,5 19,0 18,5 18,0 226,7
ases 0 0 00 000 00 00 000 00 00 00 00 00 00
Salari 44,00 44,0 44,0 44, 44,0 44,0 44, 44,0 44,0 44,0 44,0 44,0 528,0
es 0 00 00 000 00 00 000 00 00 00 00 00 00
Rent 4,000 4000 4000 400 4,00 4000 400 4000 4000 4000 4000 4000 48,00
0 0 0 0
Trans 100 100 100 100 100 100 100 100 100 100 100 100 12,00
port 0
Licens 3000
e
Adver 1000 1000 1000 100 1000 1000 100 1000 1000 1000 1000 1000 12,00
t 0 0 0
(poste
rs)
Insura 1000 1000 1000 100 1000 1000 100 1000 1000 1000 1000 1000 12,00
nce 0 0 0
Prom 5,500
otions
Loan 2,000 2000 2000 200 2000 2000 200 2000 2000 2000 2000 2000 24,00
payme 0 0 0
nt
Electr 800 800 800 800 800 800 800 800 800 800 800 800 9,600
icity
bills
Statio 100 100 100 100 100 100 100 100 100 100 100 100 1,200
nary
Miscel 200 200 200 200 200 200 200 200 200 200 200 200 2,400
laneou
s
Total 85,10 75,6 75,2 74, 74,0 73,4 72, 73,9 75,2 74,4 73,9 73,0 901,5
cash 0 00 00 400 00 00 400 00 00 00 00 0 00
outflo
w
Net 55,80 6030 60,6 60, 59,9 60,1 58, 60,5 58,5 58,9 58,3 59,5 709,6
cash 0 0 00 950 50 50 500 00 00 50 50 00 50
Cumu
lative
Cash 53,80 114, 174, 234 294, 354, 354 413, 532, 591, 650, 709, 6509,
outflo 0 100 700 ,75 700 880 ,88 350 950 300 150 650 650
w 0 0

CASHFLOW PROJECTION FOR YEAR 3

PARTI JAN FEB MA AP MA JUN JUL AUG SEP OCT NOV DEC TOTA
CULA R R Y LS
RS
Cash 135,2 135, 135, 135, 135, 135, 133, 135, 135, 133, 133, 133, 1,612,
sales 00 200 200 200 200 200 200 200 200 200 200 200 000
Collect 200 200 200 150 150 100 200 200 200 150 150 150 2,000
ion
from
debtor
Bank
from
debtor
Sale of 5,000 2,00 200 1,00 1,00 1,00 1,00 500 500 500 500 500 15,50
assets 0 0 0 0 0 0
scrap
Grants 300 500 400 300 200 400
donati
ons
Totals 135,9 1359 135, 134, 134, 133, 131, 134, 134, 132, 132, 132, 1,611,
cash 00 00 900 450 550 400 400 400 400 750 900 900 450
inflow
Cash
out
flow
Purch 19,80 1980 19,8 19,0 19,0 18,0 17,0 18,5 19,5 19,0 18,5 18,0 226,7
ases 0 0 00 00 00 00 00 00 00 00 00 00 00
Salarie 8000 8000 8,00 8,00 8,00 8000 800 8000 8000 8000 8000 8000 96,00
s 0 0 0 0 0
Rent 4000 4,00 4000 400 4000 4000 400 4000 4000 4000 4000 4000 48,00
0 0 0 0
Trans 100 100 100 100 100 100 100 100 100 100 100 100 12,00
port 0
Licens 4,000
e
Advert 1000 1000 1000 100 1000 1000 100 1000 1000 1000 1000 1000 12,00
(poster 0 0 0
s)
Insura 1,000 1000 1000 100 1000 1000 100 1000 1000 1000 1000 1000 12,00
nce 0 0 0
Promo 5,500
tions
Loan 2,000 2000 2000 200 2000 2000 200 2000 2000 2000 2000 2000 24,00
payme 0 0 0
nt
Electri 800 800 800 800 800 800 800 800 800 800 800 800 9,600
city
bills
Statio 100 100 100 100 100 100 100 100 100 100 100 100 1,200
nary
Miscel 200 200 200 200 200 200 200 200 200 200 200 200 2,400
laneou
s
Total 85,10 75,6 75,2 74,4 74,0 73,4 72,4 73,9 75,2 74,4 73,9 73,0 901,5
cash 0 00 00 00 00 00 00 00 00 00 00 0 00
outflo
w
Net 55,80 6030 60,6 60,9 59,9 60,1 58,5 60,5 58,5 58,9 58,3 59,5 709,6
cash 0 0 00 50 50 50 00 00 00 50 50 00 50
Cumul
ative
Cash 53,80 114, 174, 234, 294, 354, 354, 413, 532, 591, 650, 709, 6509,
outflo 0 100 700 750 700 880 880 350 950 300 150 650 650
w
 Summary for the net cash flow for Manos computer and research
Item Year 1 Year 2 Year 3

Net cash 38960 40790 60820

5.4 Pro forma Profit and Loss Account for Mano Computer and Research for one year
Item Amount Ksh. Amount Ksh
Cash sales 1021718
Debtors 1100
Total sales 1022818
Cost of goods sold 609606
Gross profit 413212
Expenses
Salary 234000
Rent 48000
Telephone and electricity 31400
Insurance
Traveling expense 12000
Promotion and advertisement 4580
Stationary 6800
Trade license
Renovation 2300
Miscellaneous fee 5000
Loan repayment 5800
Total expense 4300
Net profit before tax 23040
Less tax 15% 337220
Net cash 35992
53298.80
30593.20

5.5 Pro forma Profit and Loss Account for Manos Computer and Research year two
Item Amount Ksh. Amount Ksh
Cash sales 1249000
Debtors 5400
Total sales 1254400
Cost of goods sold 774000
Gross profit 480400
Expenses
Salary 234000
Rent 48000
Telephone and electricity 48800
Insurance 12000
 Traveling expenses 3970
Promotion and advertisement 2500
Stationary 1300
Trade license 5000
Renovation 4000
Miscellaneous 2000
Loan repayment 23040
Total expense 384610
Net profit before tax 95790
Less tax 15% 14368.50
Net cash 814212.50

5.6 Pro forma Profit and Loss Account for Manos Computer and Research three
Item Amount Ksh Amount Ksh
Cash sales 1419000
Debtors 2400
Total sales 14214400
Cost of goods sold 899000
Gross profit 522400
Expense
Salary 252000
Rent 48000
Telephone and expense 48400
Promotion and advertisement 2400
Stationary
Trade license 900
Renovation 50000
Miscellaneous 2000
Loan repayment 2000
Total expense 23040
Net profit before tax 398580
Less tax 15% 123820
Net cash 18573
105247

Summary Net Income for three years

Item Year 1 Year 2 Year 3
Profit 30593.20 81421.50 105247

2 Summary of Pre-operational Cost

Item no Item Amount
 1 Loan processing fee 150
2 Bank account(opening) 1000
3 Electricity(advance payment) 2000
4 Deposit(water) 2000
5 Promotion and advertisement 2500
6 Insurance 3500
7 Miscellaneous fees 2000
8 Travelling expense 3000
Total 16150

5.5Estimate of Working Capital

Item no Item Amount Ksh.
1 Opening stock 68710
2 Salaries 19500
3 Water, electricity and water 4000
4 Traveling expense 2000
5 Advertisement and promotion 2000
6 Insurance 1000
7 Stationary 1000
8 Rent 4000
9 license 3500

Total 105710
Total estimate of working capital is Ksh.105710

5.7 Estimate of fixed assets

Item no Item Amount Ksh.
1 Furniture 8000
2 measuring jug 100
3 Milk can 10000
4 Calculator 1000
5 60
6 Dell screen 14180
7 laptop 25000
8 binder 5000
9 Ink 700
10 laminator 12000
11 100
12 Binding tape 200
Total 78140

Summary for the net cash flow for

 Item Year 1 Year 2 Year 3

Net cash 95960 95790 123820

5.8 Pro forma Profit and Loss Account for Manos Year one
Item Amount Ksh. Amount Ksh
Cash sales 1021718
Debtors 1100
Total sales 1022818
Cost of goods sold 609606
Gross profit 413212
Expenses
Salary 234000
Rent 48000
Telephone and 31400
electricity
Insurance 12000
Traveling expense 4580
Promotion and 6800
advertisement
Stationary 2300
Trade license 5000
Renovation 5800
Miscellaneous fee 4300
Loan repayment 23040
Total expense 337220
Net profit before tax 35992
Less tax 15% 53298.80
Net cash 30593.20

Pro forma Profit and Loss Account for Manos computer And Research year two
 Item Amount Ksh. Amount Ksh
Cash sales 1249000
Debtors 5400
Total sales 1254400
Cost of goods sold 774000
Gross profit 480400
Expenses
Salary 234000
Rent 48000
Telephone and electricity 48800
Insurance 12000
Traveling expenses 3970
Promotion and advertisement 2500
Stationary
Trade license 1300
Renovation 5000
Miscellaneous 4000
Loan repayment 2000
Total expense 23040
Net profit before tax 384610
Less tax 15% 95790
Net cash 14368.50
814212.50

5.7Pro forma Profit and Loss Account for year three

Item Amount Ksh. Amount Ksh
Cash sales 1419000
Debtors 2400
Total sales 14214400
Cost of goods sold 899000
Gross profit 522400
Expense
Salary 252000
Rent 48000
Telephone and expense 48400
Promotion and advertisement 2400
Stationary 900
Trade license 50000
Renovation 2000
Miscellaneous 2000
Loan repayment 23040
Total expense 398580
Net profit before tax 123820
Less tax 15% 18573
 Net cash 105247

Summary Net Income for three years

Item Year 1 Year 2 Year 3
Profit 30593.20 81421.50 105247

Current assets Current

Cash in hand 20,000 liabilities -6000
Cash at bank 100,000 Creditors -4000
Stock 20,000 Salaries -10,000
Debtors 2000 Total
Total 142000
Long term 23040
Fixed Assets liabilities
Furniture 8,000 Bank loan 396480
Tools & 60,000
equipment Total liabilities 1799.620
Calculator
Mobile Net worth

Total 68,000
Total assets 210,000

Total 2196.100 Total 210,000

Break Even Point for Year One

Variable expenses Amount Ksh. Fixed Assets Amount Ksh.
Purchases 609,606 Rent 4800
Telephone and 31400 Salary 234000
electricity Insurance 12000
Promotion and 6800 Trade licensee 5000
advertisement Loan repayment 23040
Stationary 2300
Renovation 5800
Miscellaneous 4300
Travelling expenses 4580

Total
664786 Total 322040
Total annual sales =1021718
 Gross margin sales = annual sales – Variable expenses {1021718-664786=356932}
 Gross margin percentage= Gross margin*100/annual sales
 Gross margin percentage= 356932*100/1021718=35%
  BEP=Fixed cost * 100/Gross margin {322040* 100/35=920114.30}

5.8Break Even Point for Year Two

Variable expenses Amount Ksh. Fixed Assets Amount Ksh.
Purchases 774000 Rent 48000
Telephone and 48800 Salaries 234000
electricity Trade license 5000
Promotion and 2500 Loan repayment 23040
advertisement Insurance 12000
Stationary 1300
Renovation 4000
Miscellaneous 2000
Travelling expense 3970

Total 836570 Totals 322040

Total annual sales =1249000
 Gross margin = annual sales – Variable expenses
 Gross margin=1249000-836570=412430
 Gross margin%=Annual variables*100/annual sales
 Gross margin=412430*100/1249=33%
 BEP=Fixed expense*100/Gross margin percentage {322040*100/33=975878.80}

Break Even Point for Year Three

Variable expenses Amount Ksh. Fixed Assets Amount Ksh.
Purchases 899000 Rent 48000
Telephone and 48800 Salary 252000
electricity Trade licensee 5000
Promotion and 2400 Loan repayment 23040
advertisement Insurance 12000
Stationary 900
Miscellaneous 2000
Travelling 2840
Totals 957540 Totals 340040

Total annual sales = 1419000

 Gross margin = annual sales – Variable expenses
 Gross margin=1419000-957540=641460
 Gross margin%=Annual variables*100/annual sales {461460*100/1419000=33%}
  BEP=Fixed expenses*100/gross margin percentage {340040*100/33=1030424.20}

Summary of Break Even Point

Item Year 1 Year 2 Year 3
B.E.P 920114.30 975878.80 1030424.20
Sales 1021718 1249000 1419000
Gross profit 101603.70 273121.20 388575.80

5.9 Calculation of profitability ratio for year one

 Gross profit Margin (GPM) = Gross Profit x 100/Total sales
 Gross profit margin year one=413212*100/1021718=40%
 Gross profit margin year two=480400*100/1249000=38%
 Gross profit margin year three=522400*100/1419000=37%
i. Summary for the gross profit margin for the three years
Items Year one Year two Year three
Profit and loss margin 40% 38% 37%

iii. The business Return on Equity

 ROE=Net profit after tax*100/net worth
 Return on equity year one=30593.20*100/170920=18%
 Return on equity year two=81421.50*100/152420=53%
 Return on equity year three=105237*100/176960=59%

Summary on Return on Equity for three years

Year Year 1 Year 2 Year 3
R.O.E% 18% 53% 59%

Return on investment
 ROE=Net profit after taxation*100/Total capital
 Return on investment year one=30593.20*100/200000=15%
 Return on investment year two=81421.50*100/200000=41%
 Return on investment year three=105247*100/200000=53%

Summary on Return on Investment

Years Year1 Year 2 Year 3
R.O.I 15% 41% 53%
Desired financing need for ESSY COMPUTER AND RESEACH
Items Amount Ksh.
Pre-operational cost 16150
Fixed cost (Assets) 78140
Working capital 105710
Total 200000

Proposed loan and interest

FUNDING PRINCIPLE RATE OF PERIOD FOR INTEREST TOTAL
SOURCE LOAN in Ksh INTEREST PAYMENTS ON LOAN SUM
IN MONTHS
Kehancha 60000 15% 36MNTHS 9120 69120
Sacco

SUMMARY LOAN REPAYMENT SCHEDULE

YEAR FUNDING TOTAL MONTHLY TOTAL LOAN
SOURSE AMOUNT INSTALEMENT PER YEAR BALANCE
1 Ntimaru Sacco 60000 1920 23040 36960
2 Ntimaru Sacco 1920 23040 13920
3 Ntimaru Sacco 1920 23040

SECURITY FOR BORROWING

The security for borrowing will be family assets and the repayment period will be 36months.
Condition for borrowing
 One must have a bank account.
 One must have a guarantor.
 ID COPY.