BUSINESS PLAN FOR KING MAKERS RESTAURANT

BCO/0042/22

PETER MUCHIRI

BUSINESS PLAN PRESENTED TO SCHOOL OF BUSINESS DEPARTMENT OF

BUSINESS ADMINISTRATION AND MANAGEMENT IN PASSION FULFILLMENT
FOR THE AWARD OF BACHELOR DEGREE IN COMMERCE KIBABII
UNIVERSITY(ACCOUNTING OPTION)

2024

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DECLARATION STATEMENT
I,Peter Muchiri,declare that this is my original work and has not been previously
published or submitted to any examining body.

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DEDICATION
I dedicate this work to my family and close friends who have been with me through this course for
it has not been easy with all these commitments,hard work and graft I had to give in order for this
work to be accomplished.May God bless you for your support and faith in my work.

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ACKNOWLEDGEMENT
I would like to acknowledge the assistance accorded to me by my lecturer, friends and my
family.I also acknowledge my fellow classmates who challenged me to do well in my
studies and academics.This knowledge and experience will be cherished and invaluable.

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ABBREVIATION
CBD- Central Business Districts
Kshs- Kenyan shillings
Tel- Telephone
EC- Executive Chef
NO.- Number
HR- Human Resources
A/C- Account
KCB- Kenya Commercial Bank
NHIF- National Health Insurance Fund
NSSF- National Social Security Fund
NEMA- National Environmental Management Authority
VAT- Value-Added-Tax

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TABLE OF CONTENT

CONTENTS
DECLARATION STATEMENT ........................................................................................................ ii
DEDICATION .................................................................................................................................. iii
ACKNOWLEDGEMENT ................................................................................................................. iv
ABBREVIATION .............................................................................................................................. v
TABLE OF CONTENT ..................................................................................................................... vi
CHAPTER ONE ............................................................................................................................... 1
1.1. EXECUTIVE SUMMARY.................................................................................................. 1
1.1.1. BUSINESS DESCRIPTION ........................................................................................ 1
1.1.2. MARKETING PLAN .................................................................................................. 1
1.1.3. MARKETING AND ORGANIZATIONAL PLAN ....................................................... 1
1.1.4. PRODUCTION AND OPERATION PLAN.................................................................. 1
1.1.5. FINANCIALPLAN ..................................................................................................... 1
CHAPTER TWO ............................................................................................................................. 2
2.1. BUSINESS DESCRIPTION ............................................................................................... 2
2.1.1. BUSINESS NAME ...................................................................................................... 2
2.1.2. VISION AND MISSION STATEMENT....................................................................... 2
2.1.3. BUSINESS LOCATION AND ADDRESS..................................................................... 2
2.1.4. FORM OF BUSINESS OWNERSHIP.......................................................................... 2
2.1.5. TYPE OF BUSINESS ................................................................................................. 3
2.1.6. PRODUCTS AND SERVICES .................................................................................... 3
2.1.7. JUSTIFICATION OF THE OPPORTUNITY .............................................................. 3
2.1.8. INDUSTRY ANALYSIS .............................................................................................. 3
2.1.9. BUSINESS GOALS AND OBJECTIVES ................................................................... 3
CHAPTER THREE .......................................................................................................................... 5
3.1. MARKETING PLAN ......................................................................................................... 5
3.2. CUSTOMERS .................................................................................................................... 5
3.3. MARKET SHARE ............................................................................................................. 5
3.4. BEFORE PENETRATION. ................................................................................................ 5
3.5. AFTER PENETRATION ................................................................................................... 6
3.6. COMPETITION ................................................................................................................ 6
3.7. METHODS OF PROMOTION AND ADVERTISEMENT ................................................... 7
3.8. PRICING STRATEGY....................................................................................................... 7
3.9. SALES TACTICS .............................................................................................................. 7
CHAPTER FOUR............................................................................................................................. 8

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 4.1. ORGANIZATIONAND MANAGEMENT PLAN ............................................................... 8
4.1.1. ORGANIZATION STRUCTURE ............................................................................... 8
4.1.2. RECRUITMENT,TRAINNING &PROMOTION........................................................ 8
4.1.3. REMUNERATION AND INCENTIVES ...................................................................... 8
4.1.4. LICENCES,PERMITS AND BY-LAWS ...................................................................... 9
4.1.5. SUPPORT SERVICES...............................................................................................10
CHAPTER FIVE ............................................................................................................................11
5.1. OPERATION PLAN ........................................................................................................11
5.1.1. PRODUCTION FACILITIES AND CAPACITY .........................................................11
5.1.2. PRODUCTION STRATEGY .....................................................................................12
5.1.3. INVENTORY LIST ...................................................................................................13
5.1.4. MONTHLY LABOUR COST .....................................................................................14
5.1.5. MONTHLY OVERHEAD COSTS..............................................................................14
5.1.6. PRODUCTION/OPERATION PROCESS...................................................................15
5.1.7. REGULATIONS AFFECTING OPERATIONS ...........................................................15
CHAPTER SIX ...............................................................................................................................17
6.1. FINANCIAL PLAN...........................................................................................................17
6.2. FINANCIAL SOURCES....................................................................................................17
6.3. PRE-OPERATIONAL COSTS ......................................................................................21
6.3.1. WORKING CAPITAL ESTIMATION .....................................................................21
6.3.2. PRO-FORM INCOME STATEMENT BALANCE SHEET ...........................................22
6.3.3. PRO-FORM BALANCE SHEET AS AT 31ST DECEMBER,2019 .................................23
REFERENCES ................................................................................................................................24

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 CHAPTER ONE
1.1. EXECUTIVE SUMMARY
1.1.1. BUSINESS DESCRIPTION

The name of the proposed business will be “KINGMAKERS RESTAURANT.”It will be a

sole proprietorship,and owned by Michael Mwose Nduya.The core function of the business
will be to provide food and beverages to customers as well as providing certain activities
such as banqueting and catering services.The business will be located in the C.B.D near
Kencom House in Nairobi County.

1.1.2. MARKETING PLAN

This business is targeting mainly clients who middle class residents and business class
residents.We also target big organizations who are looking to host forums, parties and
meetings who hire my establishment for catering services.

1.1.3. MARKETING AND ORGANIZATIONAL PLAN

The proprietor will solely manage the business.The main aim of the business is to provide
food,beverage and catering services,the business will have shareholders,general
manager,chefs,waiters,store and requisition manager,human resource team who will be
issuing advice and services to the business,an accountant will be hired on a retainer basis to
compile both monthly and yearly accounts,and also maintain the Businesses Accounts and
receptionist/front office manager.

1.1.4. PRODUCTION AND OPERATION PLAN

The production of food and beverage items shall be done in the site of the establishment in a
production area which will a fully equipped kitchen and will be served in the restaurant area
where the customers will be occupying.For the catering process,the food will be prepared in
the production area then delivered to the event.

1.1.5. FINANCIALPLAN

The proprietor will have an operational budget of Kenya shillings one million (1,000,000/=).As
at the beginning,all equipment not available shall be outsourced.

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 CHAPTER TWO
2.1. BUSINESS DESCRIPTION
2.1.1. BUSINESS NAME
The business name will be "KINGMAKERS RESTAURANT".This is because the
primary objective of the business is to provide food and beverage services to clients
who want to have first class culinary experience and make the customer/guest the king.It
will be a service that will be defined by the client's culture and present norms in the
society.

2.1.2. VISION AND MISSION STATEMENT

The vision of the business:to be the best in quality restaurant in the world by
making our customers happy and feel special. Mission:Quality and
professionalism is permanent.

2.1.3. BUSINESS LOCATION AND ADDRESS

The business is located in the Central Business District near Kencom House in Nairobi
County

The address will be:

KINGMAKERS RESTAURANT

P.O.BOX 6262-00200

NAIROBI COUNTY,KENYA

TEL:+254717899225

Email: p e t e r m o s h 7 7 7 @ g m a i l . c o m

2.1.4. FORM OF BUSINESS OWNERSHIP

The business will be a"sole proprietorship",managed by the proprietor.This is because it
is a start-up and requires a moderate amount of capital to begin.

The proprietor is a trained chef and waiter,has a working experience from various hotels and
events and is aware of the needs and challenges that come through with owning a food and
beverage outlet.As a starting business,the proprietor will be

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able to make decisions faster and more flexibly

2.1.5. TYPE OF BUSINESS

The business is a proposed start-up.The business will be a product and service

provider in terms of ensuring that clients get quality prepared food and it is served in the best
way possible to satisfy the guests.This will be done at the site of the

establishment or at the places the functions will be held in which case production will be
done at the business premises and transported to the functions.

2.1.6. PRODUCTS AND SERVICES

The main products to be offered are food and beverage items in which this business specializes
in.The food is prepared by chefs and produced from the kitchen while the beverages which
are purchased by the establishment will be sold at the bar.

Then the service is done by the service team which are the waiters in a procedural way to
give the customer a good experience.

2.1.7. JUSTIFICATION OF THE OPPORTUNITY

There are a lot of restaurants in or around the CBD but due to my experience working
in several hotels and restaurants I believe I have an edge over my competitors in this
business.Most start-up businesses fail because most proprietors do not have the
experience in their business industry,but I have the experience in

culinary and service expertise and in marketing my restaurant.

2.1.8. INDUSTRY ANALYSIS

The business falls under the food and beverages productions industry or in general the
hospitality industry.The industry is growing steadily with the increase of incomes and
population.More people(especially young people)are starting to enjoy restaurant food and
beverages because most of them have no time for home cooking and have a special liking for
culinary culture in this modern times. It also falls under the catering industry because large
public/private organizations cannot produce their own food so they outsource their food from
food producing establishments who are well renowned in the hospitality industry.

2.1.9. BUSINESS GOALS AND OBJECTIVES

2.1.9.1. Goals
The main goal of the business is to specialize in the food and beverage service and become
the best establishment in the industry.
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 CHAPTER THREE
3.1. MARKETING PLAN
Here the proprietor will look at the intended customers,the market share they intend
to achieve,the competition,promotion,pricing and sale strategies.

3.2. CUSTOMERS
My intended customers are middle and upper management personnel in corporate
businesses,and at personal levels.We'll accommodate the customers in the site of the
establishment.The menus are agreed upon,the service area,and the type of service.This
shall be done by the general manger and executive chef.The client's sources and the
business sources will be compared to arrive at the most convenient prices.Thereafter,all
production will be done on the business premises (kitchen)by the kitchen personnel.For
catering services the establishment will be hired by the large corporations and a menu will
be formulated to suit the client's needs,produce the food and delivering on a certain date
according to the contractual agreement.

3.3. MARKET SHARE

This field has not been exploited well and the main food and beverage service

providers in such a capacity are the big hotels,though recently there are three who are trying
to get this done though in similar settings such as the food and beverage service and outside
catering alone,well this consideration is being done.The

competitors are Baseline Restaurant,Homeboyz Restaurant;this survey was done to help

identify the market

3.4. BEFORE PENETRATION.

Baseline Restaurant Homeboyz Restaurant. Total

Sales 216 144 360

Market share 60% 40% 100%

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 Sales
■ Baseline Restaurant Homeboyz Restaurant

40.00%

60.00%

3.5. AFTER PENETRATION

KINGMAKERS Baseline Homeboyz Total

RESTAURANT Restaurant Restaurant

Sales 58 162 140 360

Market 20% 42% 38% 100%

Share

3.6. COMPETITION
Amongst my competition :

Baseline Restaurant stands out. Baseline Restaurant has tried to keep abreast with the
changing trends in the market.They are also efficient in their food production and deliver
their food and beverage on time.Their services are above average since they try to keep
with the market trends but they lack the staff retention and because of that they end up
giving low quality service to their customers.

In the case of Homeboyz Restaurant,they adjust when the customer's

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request and are not always on time.Their food is off high standards and their service is
below average. Both have all the necessary equipment,have contracted suppliers and
permanent staff. They also own their premises.Their main weakness lies in their
presentation.Their staff lack communication skills;in this industry,clients are constantly
making adjustments before and during functions.When there is a breakdown in
communication the flow of the function is interrupted. They don't have staff retention
skills. They do not have qualified and experienced staffs who are dedicated to professionalism.
Their menus are also very rigid(fixed),and this does not give clients a wide (or free)selection
Their charges are also not very flexible.They also give poor remuneration to their staffs

3.7. METHODS OF PROMOTION AND ADVERTISEMENT

My main method of advertisement will be distribution of fliers,signage,and social media
i.e.Facebook and Instagram and a lot of networking through friends stating the products and
services provided showing tentative costs.I'll also use promotional products to promote my
business.

3.8. PRICING STRATEGY

We'll use the costing process to calculate and design the price for the food and beverages while
considering the community around,the prices of other restaurants and our clients.

3.9. SALES TACTICS

This involves adding value of the product to your customers so that they can decide to
buy your products and services. I’ll use promotional products to increase sales and make
customers happy . For the first three months there wiil be special offer which will attract
customers.

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 CHAPTER FOUR
4.1. ORGANIZATIONAND MANAGEMENT PLAN
4.1.1. ORGANIZATION STRUCTURE
The proprietor will solely manage the business.The main aim of the business is to provide
food,beverage and catering services,the business will have shareholders,general
manager,chefs,waiters,store and requisition manager, human resource team who will be
issuing advice and services to the business,an accountant will be hired on a retainer basis to
compile both monthly and yearly accounts,and also maintain the Businesses Accounts and
receptionist/front office manager.

4.1.2. RECRUITMENT,TRAINNING &PROMOTION

4.1.2.1. RECRUITMENT
The personnel especially the waiters will be recruited by the manager and the human resource
personnel on need to basis.The chefs,waiters and stewards will require Certificates of Health
which are issued by Nairobi County Government and valid for one(1)year.

• The chefs will have a Diploma in their respective fields,

• The waiters will have a certificate and a 1 year experience (minimum),
• The steward &cleaner will have a minimum of form four (4)education.
• The receptionist will have a Diploma in any business related course
• The accountant should have CPA1&2 minimum
• The Human resource should have a degree or diploma

4.1.2.2. TRAINING
The general manager is a trained and experienced Chef and waiter.He will keep abreast with
new trends in the industry and train the hired staff personally with the help of the human
resource personnel.This will be a continuous process as each client will have their specific
requirements both in the production and service at functions.This will personalize the service

4.1.2.3. PROMOTION
The staff will be promoted on basis of their merits.

4.1.3. REMUNERATION AND INCENTIVES

4.1.3.1. REMUNERATION
Remuneration shall be as follows

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 EMPLOYMENT TITLE MONTHLY ALLOWANCE TOTAL
NO.

1. MANAGER 20,000 10,000 30,000/=

2. HUMAN 15,000/= 8, 000 23,000/=

RESOURCE

3. ACCOUNTANT 15,000/= 8,000 23,000/=

4. RECEPTIONIST 12,000/= 5,000 17,000/=

5. CHEFS 15,000*3 6, 000*3 72,000/=

6. WAITERS 12,000 3,000 15,000/=

7 STEWARDS 9,000 2,000 11,000/=

8. CLEANER 7,000/= 2,000 9,000/=

9. FRONT 14,000/= 7,000/= 21,000/=

OFFICE
MANGER

TOTAL 221,000/=

4.1.3.2. INCENTIVES
In the event of any adjustment/s during the service delivery (time period and/or additional
services),the Manager will pay each member of the staff 300/=,a flat rate,however that does
not include the human resource,accountant,receptionist or cleaner.In the event that clients
are known to appreciate services well provided, any appreciation offered will be granted
amongst the staff involved in the specific service delivery.

4.1.4. LICENCES,PERMITS AND BY-LAWS

4.1.4.1. LICENCES
The business license will be acquired from the Nairobi City County.It is a single business
permit falling under category 595 and will cost Ksh.Ten thousand only (10,000/=). There
will be health permit for all chefs,waiters and stewards valid for one (1)year only.

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4.1.4.2. BY-LAWS
The by-laws complied with will fall under the Nairobi City County Health

Department.This is because the business will be dealing with food for human
consumption and must maintain high hygiene standards

4.1.5. SUPPORT SERVICES

4.1.5.1. BANKING SERVICES
We will urge our clients to pay directly to the bank or swipe using their bankcard to avoid
many cash transactions whereby later we will bring along the Mpesa till

number in order to be flexible to our clients.Below are our bank details

KENYA COMMERCIAL BANK

015000584471-A/C NUMBER

CORELINE SERVICES-A/C NAME.

4.1.5.2. LEGAL SERVICES

MUHATIA PALA AND ASSOCIATES

P.O.BOX 44199-00100
NAIROBI.
TEL 0722-725480

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 CHAPTER FIVE
5.1. OPERATION PLAN
5.1.1. PRODUCTION FACILITIES AND CAPACITY
The business primarily deals with cooking at the business premises;the following
equipment is listed hereunder.

Items Quantity Unit Cost Total Cost

Pots (Sufurias) 10 1000/= 10,000/=

Jikos 5 1000/= 5,000/=

Storage Bins 10 500/= 5,000/=

Knives 10 200/= 2,000/=

Chopping Boards 5 200/= 1,000/=

Wooden Spoons 5 300/= 1,500/=

Rolling Pins 2 100/= 200/=

Pans 2 500/= 1,000/=

Working Surfaces 2 2000/= 4,000/=

(Tables)
Grills 2 5000/= 10,000/=

Desk 5 5,000/= 25,000/=

Chairs 28 1,500/= 42,000/=

Filling Cabinet 1 3,000/= 3,000/=

Miscellaneous 1 800/= 800/=

Uniforms 4 1,000/= 4,000/=

Printing materials 1 2,000/= 2,000/=

Tables 7 1,000 7,000

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 Gas cookers 8 5,000 40,000

Chaffing dishes 10 3,000 30,000

Total Cost 193,500

Machine Quantity Unit Cost Total Cost

Tables 4 6,000/= 24,000/=

Chairs 4 4,500/= 18,000/=

Computers 3 12,000/= 36,000/=

Printer 1 15,000/= 15,000/=

Stationery(pens 20,000/=
notebooks,
staplers,paper
punch etc.)

Extension sockets 5 600/= 3.000/=

Filling Cabinet 2 3.000/= 6.000/=

Files 20 40/= 800/=

Office phone 1 1,000/= 1,000/=

Padlocks 3 1000/= 3,000/=

curtains 6 500/= 3,000/=

Visitors Chairs 10 1,000/= 4,000/=

Miscellaneous 1 5,000/= 5,000/=

TOTAL COST 138000/=

5.1.2. PRODUCTION STRATEGY

All raw materials(ingredients)once purchased,will be thoroughly cleaned and either pre-
prepared(e.g.portioning [cutting into sizes]),or stored systematically awaiting

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production.Before any production period,an inventory of all production materials and
equipment required for the particular production will be written, checked and counter
checked.This will ensure that when production commences it flows smoothly.

5.1.3. INVENTORY LIST

Items Quantity Unit Cost Total Cost

Pots (Sufurias) 10 1000/= 10,000/=
Jikos 5 1000/= 5,000/=
Storage Bins 10 500/= 5,000/=

Knives 10 200/= 2,000/=

Chopping Boards 5 200/= 1,000/=
Wooden Spoons 5 300/= 1,500/=
Rolling Pins 2 100/= 200/=

Pans 2 500/= 1,000/=

Working Surfaces (Tables) 2 2000/= 4,000/=

Grills 2 5000/= 10,000/=

Desk 5 5,000/= 25,000/=
Chairs (1) 0 1,500/= 42,000/=

Filling Cabinet 1 3,000/= 3,000/=

Miscellaneous 1 800/= 800/=

Uniforms 4 1,000/= 4,000/=

Printing of 1 2,000/= 2,000/=
Materials
Tables 7 1,000 7,000
Gas cookers 8 5,000 40,000

Chaffing dishes 10 3000 30000

Total Cost 193, 500/=

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5.1.4. MONTHLY LABOUR COST

EMPLOYMENT TITLE MONTHLY ALLOWANCE TOTAL

NO.

1. MANAGER 20,000 10,000 30.000/=

2. HUMAN 15, 000/= 8,000 23,000/=

RESOURCE

3. ACCOUNTANT 15,000/= 8,000 23,000/=

4. RECEPTIONIS 12.000/= 5,000 17,000/=

5. CHEFS 15,000*3 6.000*3 72,000/=

6. WAITERS 12,000 3,000 15,000/=

7. STEWARDS 9,000 2,000 11,000/=

8. CLEANER 7,000/= 2,000 9,000/=

9. FRONT 14.000/= 7,000/= 21,000/=

OFFICE
MANGER

TOTAL 221,000/=

5.1.5. MONTHLY OVERHEAD COSTS

NO ITEM TOTAL
1. ELECTRICITY 3,000/=

2. WATER AND 800/=

SEWARAGE SERVICES
4. REPAIR 5.000/=

5. AIRTIME 2.000/=

6. TRANSPORT 15.000/=

7. MISCELLENOUS 5.000/=

TOTAL 30,800/=

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 ITEM TOTAL

COST OF RAW MATERIAL 59,000/=

COST OF LABOUR 221,000/=

OVERHEAD COST 30,800/=

TOTAL 310,800/=

The services area/s,type/s of service and equipment would have been identified beforehand
and in place before service commences.This is where the importance of continuous
communication is seen.Should there arise an adjustment in the number of guests(either
fewer or more)production may have to increase /decrease.Depending on the increase
/decrease,the type/s of service,services area /s and or equipment may have to be adjusted
drastically.Communication is key.

5.1.6. PRODUCTION/OPERATION PROCESS

The clients will always be handled first at the reception desk where they will be given details
of the products and services (food and beverages)that we offer since the business is starting
the manager will be involved a lot in handling the clients with the help of the receptionist,later
depending with the clients preference they will be directed to the restaurant area where they'll
be attended to . If there will be a client hiring the restaurant for catering services,the
receptionist will book the event and then allocate it to the chef who later is introduced to the
client for purposes of familiarity and also for the customer satisfaction.

5.1.7. REGULATIONS AFFECTING OPERATIONS

5.1.7.1. HEALTH
A Health Permit for the Business Premises will be in place before operations commence.This
will be issued by the Nairobi County Government, Department of Health. The proprietor and
staff will also have their Certificates of Health,and hygiene will be observed at all the times.The
business will also ensure that it included all its staff in the NHIF and NSSF

5.1.7.2. ENVIRONMENT
A refuse disposal company that is certified by the National Environmental Management
Authority (NEMA)will be in place at the business premises before operations
commence.Disposal of refuse at client/s functions shall be the sole responsibility of the

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client/s.In the absence,the business and client shall agree on the disposal of the refuse before
the function date.

5.1.7.3. SAFETY
All necessary safety measures(e.g.fire extinguishers,first aid kits)will be in place before
operations commence.

5.1.7.4. TAXATION
Annual taxations regulations will be worked on by the accountant,the business will have
an electronic transfer machine that will be used to pay for all the VAT taxes as required
by the law.

5.1.7.5. LABOUR LAWS

The business will ensure that it follows the labor laws as stipulated in the constitution.

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 CHAPTER SIX
6.1. FINANCIAL PLAN
6.2. FINANCIAL SOURCES
1. Personal Savings
Personal savings refer to the owner using their own money, usually accumulated over time, to
fund the restaurant's start-up or to cover ongoing expenses. This might involve liquidating
personal assets, such as savings accounts, stocks, bonds, or even real estate. Many
entrepreneurs rely on their personal savings to avoid debt or giving up equity. Using personal
savings allows for full control over the business but also carries the risk of losing personal
funds if the business fails.
Use cases:
• Covering initial costs like restaurant setup, renovation, and equipment purchase.
• Funding day-to-day operations when cash flow is tight.

2. Bank Loans
A bank loan is one of the most traditional ways to finance a restaurant. It involves borrowing
money from a bank or financial institution with the agreement to repay the loan with interest
over a set period of time. The restaurant owner must usually provide collateral (such as personal
assets or business property) to secure the loan, and banks will require a solid business plan and
proof of the restaurant's ability to repay the loan.
Use cases:
• Large capital expenses, such as buying real estate, renovating the space, or purchasing
equipment.
• Cash flow management or funding operating expenses.

3. Small Business Administration (SBA) Loans

The Small Business Administration (SBA) offers loan programs designed to help small
businesses, including restaurants, obtain financing when they might not qualify for a traditional
bank loan. SBA loans are typically easier to obtain than conventional loans because the
government guarantees a portion of the loan, reducing the risk for lenders. These loans can be
used for purchasing equipment, working capital, or expanding the business.
Use cases:
• Financing real estate or purchasing long-term assets like equipment.
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 • Working capital to cover day-to-day expenses or unexpected costs.

4. Investor Funding
Investor funding involves raising money from investors in exchange for equity (ownership)
or debt. Investors may include individuals (angel investors) or firms (venture capitalists). They
provide capital upfront but in exchange for ownership stakes or future repayments, depending
on whether the funding is equity-based or debt-based. Investors may also offer mentorship,
guidance, and connections to help grow the restaurant.
Use cases:
• Start-up capital to open the restaurant.
• Expanding to new locations or implementing a large-scale marketing campaign.

5. Crowdfunding
Crowdfunding is a method of raising small amounts of money from a large number of people,
typically through online platforms such as Kickstarter, Indiegogo, or GoFundMe. In
exchange for their contributions, backers may receive rewards such as early access to the
restaurant, free meals, or other incentives. Crowdfunding is usually used to fund specific
projects, like opening a new location, renovating a restaurant, or launching a new menu.
Use cases:
• Funding a new concept or restaurant opening.
• Raising money for specific projects like remodeling or launching a new menu or
catering service.

6. Trade Credit
Trade credit is when a supplier allows the restaurant to purchase goods (such as food,
beverages, or restaurant supplies) and pay for them later. Typically, trade credit allows the
restaurant to pay the supplier within 30 to 60 days after receiving the goods. This helps
businesses manage cash flow by postponing payments, giving them more time to generate
revenue before settling their bills.
Use cases:
• Purchasing food, beverages, and other supplies on credit to manage cash flow.
• Negotiating better terms with suppliers to reduce upfront expenses.

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7. Equipment Financing
Equipment financing is a specific type of loan or lease agreement designed to help businesses
purchase necessary equipment, such as ovens, refrigerators, dishwashers, or point-of-sale
systems. The equipment serves as collateral for the loan. This allows the restaurant to acquire
essential tools without having to make a large upfront payment, paying over time instead.
Use cases:
• Purchasing or upgrading restaurant kitchen equipment.
• Leasing equipment if the restaurant is unable to secure full upfront funding.

8. Credit Cards
Credit cards can be used for short-term financing, allowing restaurants to make immediate
purchases for supplies, utilities, or other expenses and pay them back over time. Restaurants
often use business credit cards to separate personal and business expenses. Credit cards provide
quick access to funds, but they come with high-interest rates if balances are not paid off within
the billing cycle.
Use cases:
• Covering operational costs in the short term.
• Purchasing inventory, utilities, or marketing services.

9. Angel Investors
Angel investors are individuals who invest their own money in start-up businesses, typically
in exchange for equity (ownership) or convertible debt (which can be converted into equity
later). They are often experienced business professionals or entrepreneurs who provide not just
capital, but also mentorship, advice, and networking opportunities. Angel investors are more
likely to invest in restaurants with unique concepts or high-growth potential.
Use cases:
• Securing initial capital for a new restaurant or expanding an existing one.
• Gaining access to strategic business advice and industry connections.

10. Venture Capital

Venture capital is funding provided by specialized investment firms to businesses with high
growth potential. Venture capitalists often focus on scalable and innovative businesses and
typically require a large equity stake in exchange for their investment. Restaurants that have
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the potential for rapid expansion or are introducing groundbreaking concepts might seek
venture capital to scale their operations quickly.
Use cases:
• Expanding to multiple locations quickly.
• Developing a high-tech or innovative restaurant concept that can be scaled.

11. Grants
Grants are funds provided by government agencies, non-profit organizations, or private
foundations that do not require repayment. Grants for restaurants may be available for specific
purposes, such as promoting sustainability, supporting community engagement, or improving
food access. Restaurants typically apply for grants through an application process that includes
outlining how the funds will be used and meeting eligibility criteria.
Use cases:
• Funding sustainability initiatives or green restaurant projects.
• Community-based programs or other public-interest activities.

12. Family and Friends

Family and friends can be a source of funding, particularly for new restaurant owners. They
may provide loans, investments, or gifts to help with start-up costs or cover operating expenses.
This is often a more informal route of financing, and the terms of the arrangement can be more
flexible. However, using family and friends as a funding source can be risky because it can
strain personal relationships if the business encounters financial difficulties.
Use cases:
• Securing initial capital for the restaurant’s opening.
• Raising funds to keep the business running during challenging periods.

13. Revenue-Based Financing

Revenue-based financing allows a restaurant to obtain funding in exchange for a percentage
of its future revenue. Instead of traditional loan repayment structures, the repayment amount
fluctuates based on the business’s income. This type of financing is particularly helpful for
restaurants with fluctuating cash flow, as payments align with actual sales. Revenue-based
financing is typically quicker to secure than other types of funding.
Use cases:
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 • Covering operational expenses during slow seasons.
• Financing expansion without giving up equity.

14. State and Local Economic Development Programs

Many states and local governments offer economic development programs to encourage
business growth, particularly in underserved or economically distressed areas. These programs
might offer low-interest loans, grants, or tax incentives to promote job creation or community
development. Governments may also offer specific incentives for restaurants that focus on
sustainability, minority-owned businesses, or creating local employment opportunities.
Use cases:
• Opening a restaurant in an economically disadvantaged area.
• Gaining tax credits or other financial incentives to reduce operational costs.
.

6.3. PRE-OPERATIONAL COSTS

ITEMS COSTS
Research 5,000/=
Licenses and permits 20,000/=
Marketing 3,000/=
Legal fee 10,000/=
Furniture,Equipment and Stationary 59,000/=
Cash 300,000/-
Overhead 17,000/=
Total 414,000/=

6.3.1. WORKING CAPITAL ESTIMATION

ITEM 1st Month (Kshs.) 2nd Month (Kshs.) 3d Month (Kshs.)

Raw Materials 143,900/= 25,000/= 25,000/=

Labour 144,000/= 144,000/= 200,000/=

Monthly overhead 45,400/= 38,800/= 38,800/=

Total Cost 333,300/= 207,800/= 263,800/=

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6.3.2. PRO-FORM INCOME STATEMENT BALANCE SHEET

YEAR 2019 2020 2021

SALES 3,770,000 3,920,000 7,180,000
COST OF SALES NIL NIL NIL
GROSS PROFIT c/d 11,520 ,500 17,772,000 38,689,500

EXPENSES

LICENCES & 20,000 20,000 30,000

PERMIT
MARKETING 8,000 40,000 90,000
PRINTING 8,000 2,000 20,000
MISCELLANEOUS 65,000 120,000 120,000
WATER AND 47,400 21,200 60,000
ELECTICTY
UNIFORMS 8,000 10,000 20,000
WAGES AND 2,288,000 2,700,000 3,400,000
SALARIES
RENT 112, 000 96,000 192,000
FURNITURE 59,000 NIL 60,000
AND
EQUIPMENT
TRANSPORT 120,000 165,000 260,000
TOTAL EXPENSES 2,735,400 3,164,200 4,232,000
NET 1,034,600 755,800 2,948,000/=
POFIT
BE
TAX(16%) (437,664) (506,272) (471,680/=)
NET PROFIT 596,936 249,528 2,476,320/=

AFTER TAX

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6.3.3. PRO-FORM BALANCE SHEET AS AT 31ST DECEMBER,2019
FIXED ASSETS AMOUNT

Furniture and Equipment 59 000

Less Depreciation(5%) (2 950)

Total Fixed Assets 56 050

CURRENT ASSETS
Cash at bank 350 000
Cash in hand 250 000
Total current assets 600 000

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REFERENCES

Desrochers, D. (2018). How to write a business plan for a restaurant. The Balance Small
Business.
Mazzarini, R. (2019). Restaurant business plans: A comprehensive guide. Food Business
News.
Entrepreneur Media, Inc. (2021). Restaurant business plan: A step-by-step guide.
Grant, M. (2020). Creating a restaurant business plan. Small Business Trends. Retrieved from
Schiffer, T. (2021).
Nilsen, P. (2017). How to write a business plan for a restaurant: Your ultimate guide.
Sullivan, J. (2020). The ultimate guide to writing a restaurant business plan. Toast POS.
Kotler, P., & Keller, K. L. (2016). Marketing management (15th ed.). Pearson Education.
Anderson, C. (2018). The business plan handbook: Practical guide for restaurant
entrepreneurs. Restaurant Business Press.

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