HOW TO WRITE A BUSINESS PLAN TABLE OF CONTENTS S/NO. CONTENT PAGE NUMBER 1. Cover page. 1 2. Table of content. 2 3. Executive summary. 3 4. Background information. 4 5. Business profile. 5 6. Industrial overview. 6 7. Product and service. 7 8. Target market. 8 9. Competitive analysis. 8 10. Marketing mix. 9 11. Organizational plan. 12 12. Risks analysis. 13 13. Financial documents. 14 14. Annex. (I) C.V 18 (ii) Copies of my vegetable products. 21 (iii) Tools 22 EXECUTIVE SUMMERY The high demand of imported vegetables Juba made Big Vision Vegetable farm to propose production of vegetables in yei River County and supply to Juba market, konyokonyo, munuki, Gudele two, and (VAMP) vegetable and meat pharmacy at tongpiny. This vegetable will be produced throughout the year extending the three months dry season with irrigation. Our products include six types of vegetables, tomato, cabbage, onion, okra, carrots and chukumawiki. Due to the increase of population in Juba by returnees and foreigners, we aim at supplying 500kgs of vegetables to Juba daily and it can generate for us 2000 SSP per day in a way that Yei is a short distant we shall be supplying vegetables in daily bases compared to vegetables imported from Uganda which take them days to reach Juba. Our project will need 50,380 SSP in dollars at a rate of 3.17 it will be 15,892 USD. In the first six months, I will work directly with casual workers, salesmen; accountant will only be hired whenever there is need. As soon as we get the startup budget it will take a week to establish our farm, you can get the details of this project when you go over my business plan. 1.0 BACKGROUND INFORMAION: Am Charles Taban Michael, resident of Yei River county, manager to the proposed Big Vision Vegetable company in Yei lasu road. My proposed business will be a Sole proprietor own by me as the manager of the business. I will work directly with casual workers and a farm supervisor to help me run the business; I will only hire experts like sales persons, accountants in timely bases to meet certain required skills like financial auditing. As far my previous experience in farming, I worked for Kagelu forestry in Yei River County rising and managing the nursery bed while producing vegetables for the forestry staff feeding from 2005 to 2007. The high demand of vegetables in Juba motivated me to produce vegetable because it will be a short distant to the market compared to one imported a long way from Uganda. 1.2 EXPECTATION IN THREE YEARS: By then of the three years Big Vision Vegetable farm should: Be the leading in producing and supplying of vegetable in Juba as I focus on quality production and daily supply to my clients. Expand the farm from 200 squire miter to 500 squire miters as I have enough fertile land for expansion. Introduce modern way of farming by use of tractor 2.0 COMPANY PROFILE: 2.1 BUSINESS DESCRIPTION: Big Vision Vegetables farm will be located in Yei Lasu road with its office/store in Juba. Our farm products are mainly vegetables that is to say tomato, cabbage, okra, onions, carrots, chukuma wiki and green paper, our production will be non-stop that’s to say throughout the year extending the three months dry season with irrigation to meet the high demand of vegetable needs in Juba Town and other major towns of central equatorial state which depend on vegetables imported from the neighboring countries. 2.2 VISION: To provide high quality vegetable products to contribute towards improved nutritional standards and reduce the high price imported vegetables. 2.3 MISSION: It’s Big Vision Vegetable farm’s mission to be the leading in production and supply of vegetables in Juba City. This will be made through by our quality vegetables produced throughout the year and our fair prices while exceeding customers/clients expectation. 2.4 OBJECTIVES: 3.0 INDERSTRIAL OVERVIEW: In the technological view of producing vegetable, changes may occur in a minimum level as we shall be using composite manure which has nothing to do with changes in technology. We shall ensure our workers trained by bringing in a technophile, mean a person who is enthusiastic about new technology in vegetable farming. Political and legal changes upon our vegetable products may only be in tax policies, the government has exempted food products from taxation if they may enforce regulations upon vegetable production it will base on use of fertilizers. As I stated above we shall only use composite manure to improve our products, we shall not be using artificial fertilizers. Viewing on demography in our market area central equatorial state, population is increasing day by day as returnees come home in large numbers increasing the population hence resulting to high demand of vegetables. In relation to birth and death on population, as we have got peace in central equatorial state no more loss of life, rear cases of epidemic diseases. People in central equatorial state are wealthy it’s only that they receive vegetables from Uganda causing inflation in the state. As we produce vegetables locally our prices will be affordable. Economically, Big Vision vegetable farm will be profitable as we are producing near the demand area transport expenses are reduced hence affordable price ricing our sells. As in our vision we shall be the leading in producing and supplying of Vegetable in Juba South Sudan. 4.0 OUR PRODUCTS: 4.1 FEATURES AND BENEFITS OF OUR VEGETABLES: Our vegetables will be the most quality ones in the market due to use of composite manure compared to ones produced by use of artificial fertilizers where the test varies. Customers will like our vegetables in way that we produce variety of them meeting consumer’s choice that is to say six types of vegetables. We shall have fewer expenses on transportation cost as our farm will be a hundred miles from the market, hence making our prices attractive and affordable to our clients. Our vegetables will be ready for sale at four months upon starting. This is because we have variety of vegetables were some of them mature within four months (i.e.) okra, chukumawiki, while some like tomato can extend to six to seven month. In four months’ time our vegetable will start entering the market hence production and supply chain in daily bases to Juba. 4.3 PRODUCTION PLAN FOR THE FIRST FOUR MONTHS: MONTHS ACTIVITIES 1st month Registration and acquiring the incorporation certificate. Land clearance and seting up nursery bad and irrigation pipe line. 2nd month Transplanting of seedlings to the farm. Weeding and applying fertilizers 3rd month Setting up the store in the target market as some vegetables are almost ready to be harvested. Employing the technical persons (i.e.) Finance and administration as transaction is due to start 4th month Harvest and transaction starts for the short life vegetables which have less maturity period (e.g.) okra, chukuma, tomatoes. The production plan above will be rotating while some of the vegetables which take six months still mature, there for by this extend Big Vision vegetable farm will be realizing some cash flowing in to implement the other activities of its growth like extending its farm bit by bit. 4.5 MACHINARY AND EQUIPMENTS NEEDED IN THE FARM DESCRIPTION QUANTITY USE DESCRIPTION QUANTITY USE Water pump 1 To pump water for irrigation Moto bike 1 for delivery of vegetables to our customers. Wood cutting machine 1 For cutting trees and timbers for packing. Hoes 25 For digging. Panger 10 For cutting small trees. Slashers. 10 For slashing the grass. Rakes 10 For removing rubbish. Axe 10 For cutting. Sururu 10 For making hole on the ground. Pipes 40 water lines for irrigation. 4.6 TARGET MARKET FOR OUR VEGETABLES: Big vision Vegetable farm will be targeting mostly the hotels in juba city, most of the hotels get their vegetables from the open market that’s to say in Konyokonyo, if our products are out we shall be directly supplying them at their various hotels. The retailers in konyokonyo is my second target, as their suppliers are from the neighboring countries it takes them long to reach their vegetables sometimes they are delayed at the customs for clearance. As am going to produce mind within South Sudan Yei country it will only take me 4 hours to reach them In the psychographic view of people in Juba, they cannot do without vegetables of any kind in a day. 80% of the meals in our community contains vegetable ricing the demand of vegetables as most of the vegetables are imported, have high price hence raising the demand. The geographical character is very good right from where the farm is set up to the market place that’s to say from Yei to Juba. Market stability: vegetable market is so stable, its stability is at the highest point. I mean to say vegetables are expensive in the market when we enter the market our prices will be at the medium rate as the current vegetables in the market comes from Uganda and Kenya as we shall be producing locally our prices will be convenient. 4.8 COMPITATIVE ANALYSIS: Direct Competitors Product Selling Price Advertisement Year in Business Importers of vegetables. All varieties of vegetables 5ssp to 15ssp Display in open market. Since 2005. Subsistent farmers. All varieties of vegetables 2 SSP to 5 SSP Display I open market Since 2001 indirect competitors Product selling price Advertisement Year in business Vegetable and meat pharmacy (VAMP) All types of vegetables 10 SSP to 50 SSP On radio, bill boards. Since 2005. Why customers buy their goods: according to the competitor analysis above, all kind of vegetables they sell come from the Uganda then Kenya and I found out that customers buy their goods because there is no farm producing vegetables in large scale in South Sudan. Most of the vegetables produced here is for consumption being done by subsistent farmers small pert goes to the market which cannot meet the demand of the customers. The most important thing I have so far learnt from my competitors is that, they are not supplying there customers in daily bases due to the distant from Kampala to Juba, as we shall be located a hundred miles from our market we shall supply them in daily bases. Their customers will choose me because my prices will be affordable as I will not be adding taxes as I produce from within and my transport cost is less enabling good price setup for my vegetables. 5.0 MARKETING MIX: 5.1 OUR PRODUCTS: As being new entry to the market, we aim at getting the 45% market share by end of three years, we shall do this by producing high quality vegetables and supply Juba in daily bases as those importing from Uganda have a long distant to reach Juba. Our buyers are: the hotel owners in Juba, retailers in the markets of Konyokonyo, Juba, Munuki, and Gudele. We shall produce and supply them in where ever they are and they will buy our vegetables because we will have an affordable price due to selling in whole sale prices. 5.2 OUR VEGETABLE PRICES: The prices of our vegetables will be in whole sale price, basing our price strategy to the current market price, we shall be selling our vegetables at 8 SSP per kilogram as packed in different quantity to meet the demand of our customers in various capacities. Ten kilograms is eighty SSP in whole sale price, in retail it will be a hundred SSP in retail price. The labor cost, overhead, and transport cost to produce one kilogram is estimated to be 3 SSP, we are aiming to at getting 5SSP per kilogram of tomato. As we aim at supplying 500 kilograms of various types of vegetables to the market, we will be generating 2000 SSP per a trip of vegetables mean while other vegetables like chukuma which are in leaves form will be sized for the appropriate price. The above estimate is for only tomato as our products comprise of six types of vegetables their prices will be of the same kind. Our target market price is high as they import vegetables from Uganda and Kenya hence our prices will be medium when we enter the market because we produce from within and it’s a strategy to overcome our competitors. Our discount plan will based on our pricing strategy that’s to say it will depend on how much our customer buy and how frequent they do, in that manner we will be discounting for 10% which will be 200 SSP of 2,000 SSP. 5.3 CHANNELS OF PROMOTION: CHANNELS EFFECTIVENESS COVERAGE FREQUENCY PRICE Radio advertisement High Covering five payams. Daily 120 SSP per month Distribution of flyers. Medium as some people don’t read Market areas monthly 250 SSP for printing. Us of leaflets. Medium as some don’t read Market areas monthly 250 SSP for printing. Exhibition High Market area monthly No cost The cost associated with the above channels of promotion will be through as our production is done throughout the year by use of irrigation and the prices of promotion stated above runs effectively especially the radio advert, the flyers and the leaflets will not be costly as we can print them our self. 5.4 PLACE: In our distribution channels, we shall establish out lets at the markets of konyokonyo, munuki, and gudele (ii), our supply from the production unit that’s to say Yei will then distribute the 500 kilograms vegetables to the three market areas we are operating at. The cost associated with our distribution channel is the same agreed transportation of the 500 kilograms of vegetables from Yei to Juba includes all distribution to our respective stores at their market location. The marketing advantage of each of our stores is that, all the storage facilities we have setup are located in open markets, the retailer will buy directly from our stores while we deliver to the other customers the hotel owners. There is no cost to our various locations as our delivery will be from the production unit to all of our stores, the cost will be the same from the departure to the destination 6.0 ORGANIZATIONAL PLAN: 6.1 HUMAN RESOURCES FOR BIG VISION VEGETABLE FARM: The structure below shows experts I will hire in timely bases, that’s to say the four major positions will NOT be hold by permanent employees they will only be hired for a period of time. In three years’ time I expand the farm and supply is done throughout then they will become full time employees of Big Vision Vegetable farm. I at the moment will directly work with casual workers paying them wages until three years when I realize growth in the farm then I employ permanent workers. 6.2 DESCRIPTION OF ROLES: General Manager (1) the manager will be in charge of the whole business, monitoring the whole process from the farm to the last point of sale. He will make sure business is running smoothly, issues arising in the business and the employees are dealt with accordingly. The general manager also holds the employees responsible of the daily business activities. Production manager (1) will be based fully at the farm; he will monitor the daily activities of the farm from the nursery bad to the field, he ensure that production of vegetables is quality up to the standard and quantity need are produced in time. He will report to the general manger. Farm supervisor (1) the farm supervisor will supervise the farm activities; all casual workers will be under his authority, record the attendant list of the casual workers and submit to the production manager or to the general manager for payment. He is the immediate person at the farm; he will stay beside the farm. Finance and account (1) the finance and account person will be hired in timely bases to do auditing of the financial documents of the business. Sales and marketing person (1) the sales and marketing person will hired in contract bases, he will do the sales of our products in Juba, do advertisement of our goods, do any activity assign to him by the general manger. He will report to the manager. Casual workers (6) the casual workers will do the cultivation work of the farm, plant the seedlings, weed the vegetables, spray insecticides were its needed. The casual workers will follow the orders of the farm supervisor. 6.3 MANAGEMENT AND PERTNERSHIP: I will manage the whole business, I will employ casual workers and only hire experts like accountant to do audit and sales person when products are ready for supply and sell. They will be paid wages at the end of their services. 6.3 LEGAL DOCUMENTS NEEDED TO OPERATE THE VEGETABLE BUSINESS: Certificate of incorporation: I will need the certificate of incorporation from the chamber of commerce, this make my business company reorganized to operate in South Sudan. Operational certificate: this will be a document got from the mayor of Juba Town to operate business in the City as my target market is Juba. I may also get the same certificate in the county level as my farm will be located in Yei River County. Tax Identification Number (TIN): this will be got from the revenue authority to operate my business; this may also help me in getting bid documents or contracts in South Sudan. 6.4 RISK ANALYSIS IN VEGETABLE PRODUCTION: 6.5 SWOT ANALYSIS: STREANTH INTERNAL WEAKNESS INTERNAL Experienced in vegetable production from nursery bad to transplanting, harvest, storage and packaging. Easy packaging process by use of timbers/wooden boxes. Irrigation facilities which will enable our production throughout the year bridging the scarcity of vegetables in the market as it take them long to import from outside country. Perishable in case of delay in delivery to the market. Pest out break which may destroy vegetable and reduce quality OPORTUNITIES EXTERNAL THREATS EXTERNAL High demand of vegetables in Juba Town as a single family can’t do without any kind of vegetable in a day. Access to enough land of 500 squire miter with possibility for expansion to 1000 squire miters. Access to reliable rainfall enabling less irrigation period of three months in a year hence reducing operational costs. Availability of labors as citizens in Yei County are hardworking most people in yei has got some knowledge In agriculture. Pest out break which may reduce the quality of our products hence increasing our cost in pesticides. Climatic changes like long dry season which will make us depend on irrigation resulting to increase in expenses. 7.0 FINANCIAL PLAN: 7.1 START-UP BUDGET: 1. MACHINARY QTY COST/ONE TOTAL COST Water pump 1 1400 SSP 1400 SSP Wood cutting machine 1 1200 SSP 1200 SSP Motor bike 1 4200 SSP 4200 SSP TOOLS: Hoes 25 15 SSP 375 SSP Panger 10 15 SSP 150 SSP Slashers. 10 15 SSP 150 SSP Rakes 10 15 SSP 150 SSP Axe 10 30 SSP 300 SSP Sururu 10 35 SSP 350 SSP Pipes for irrigation 40 40 SSP 1600 SSP Gumbuts 10 35 SSP 350 SSP Wages 6moths 21600 SSP Store rent 6month 1200/month 6000 SSP Advertisement on radio 800 SSP Irrigation costs 3255 SSP Installation of irrigation pipes 800 SSP Fuel 200 liters 6 SSP 1200 SSP Operational cost 3500 SSP REGESTRATION: Memorandum of association 500 SSP Chamber of commerce 1500 SSP Operational license 1000 SSP Tax Identification Number 600 SSP TOTAL COST START – UP OF THE BUSINESS 50,380 SSP 7.2PERSONAL FUNDS: Personal Fund Other Sources of Funding Cash------------ 3,800 SSP Liquid Assets--- 4,500 SSP Total Borrowing needed----46,580 SSP Total--------------8,300 SS 7.5 BALANCE SHHET: BALANCE SHHET ASSETS Liabilities Fixed assets 120,000 Equity 204,000 Current assets 192,000 Long term debt 14,000 Reserves 93,000 Current debt 84,000 Receivables 690,000 Liquid assets 30,000 SSP 312,000 SSP 312,000 7.6 PROFIT AND LOSE STATEMENT AS AT DEC. 30TH. 2013. Income---------------------------------------233,500 Less discount allowance------------------ (1,240) Net Profit-------------------------------------232260 Less direct costs (cost of sale) ---------- (1,800) Gross of profit------------------------------230460 Less indirect costs (fixed overhead) --- (11,000) Operating profit----------------------------219460 Profit before tax----------------------------219460 Less tax-------------------------------------- (1750) Net profit or Net loss----------------------21, 7710 SSP 7.8 BREAKEVEN ANALYSIS FIXDED COST SSP VARIABLE COST SSP wages 21,000 seeds 800 Rent 6,000 Fuel 1200 Advertisement 8,00 TOTAL 27,800 2,000 Sales price per 500kg trip of vegetables = 4000 SSP Variable cost per trip = 2000 SSP Fixed cost = 27,800 SSP Break event point =27,800/1-(2000/4000) =27,800/1-0.5 =27,800/0.5 Sales to break even =55600 SSP
Posted on: Thu, 18 Jul 2013 13:41:26 +0000
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