OL'LESSOS TECHNICAL TRAINING INSTITUTE

P.O BOX 210 - 30302,

LESSOS.
BUSINESS PLAN

TITLE: KISORIO'S ELECTRICAL AND ELECTRONICS SHOP

P.O BOX,115,

NANDI HILLS.

EMAIL: [email protected].

PRESENTER: KISORIO GEOFREY

INDEX: 5411010206

COURSE CODE: 1601/207B

SUPERVISOR:

THIS PROJECT IS SUBMITTED TO KENYA NATIONAL EXAMINATION COUNCIL

[KNEC] AS A PARTIAL FULFILLMENT FOR THE AWARD OF CERTIFICATE IN
ELECTRICAL AND ELECTRONICS ENGINEERING.

DATE OF PRENTATION : JULY/AUGUST2022

1
 DECLARATION
I declare that this is my original work and has never been presented to examination
bodies.

NAME: ………………………………………………………….

SIGN: ……………………………………………………………

DATE: ……………………………………………………………

DECLARATION BY THE SUPERVISOR

This project has been submitted to the examining body and has been approved by
me as an institute supervisor.

NAME: ………………………………………………………….

SIGN: ……………………………………………………………

DATE: …………………………………………………………….

i
 DEDICATION
I dedicate this project to my beloved parents, my sister and friends.

ii
 ACKNOWLEDGEMENT.
I acknowledge my loving parents who did everything possible to make sure they
assist me financially, morally and emotionally to give humble time at the college,
not forgetting my dear sister who supports me fully by encouraging me.

iii
 EXECUTIVE SUMMARY
BUSINESS DESCRIPTION

KISORIO'S ELECTRICAL AND ELECTRONIC SHOP will be the name of the

business aimed at importing, assembling and selling electrical products majorly
power saving equipments and machines.

The business will be located in soi-sitet town along soi-sitet raod

MARKETING PLAN

The business will aim at attracting as many customers as possible and thus will be
entitled to providing quality, durable and genuine products to its customers at an
affordable price.

MANAGEMENT ORGANIZATION

The owner of the business intends to be the manager of the business firm. The
manager will be the one to delegate duties to each worker in the firm, do the
recruitment, and propose promotions and the incentives.

PRODUCTION/OPERATION

KISORIO'S SHOP will offer high quality products ie electrical machines, gadgets
and other appliances. The business will require a telephone, pieces of computer,
chairs, tables, shelves, hooks and security lamps for its operation.

FINANCIAL PLAN

The shop will need various items to be used which will either be leased or bought
hence the management of the proposed business will ensure that all finances are
well accounted for this will include operational costs, working capital etc.

iv
TABLE OF CONTENTS
DECLARATION..........................................................................................................................................i
DEDICATION............................................................................................................................................ii
ACKNOWLEDGEMENT..........................................................................................................................iii
EXECUTIVE SUMMARY........................................................................................................................iv
CHAPTER ONE.........................................................................................................................................1
1.0 BUSINESS DESCRIPTION..............................................................................................................1
1.1 THE SPONSORS..............................................................................................................................1
1.2 BUSINESS IDENTITY/ LOCATION...............................................................................................1
1.3 FORMS OF OWNERSHIP/ BUSINESS STATUS...........................................................................1
1.4 TYPES OF BUSINESS.....................................................................................................................2
1.5 THE PRODUCTS..............................................................................................................................2
1.6 JUSTIFICATION OF PRODUCTS...................................................................................................2
1.7 THE INDUSTRY..............................................................................................................................2
1.8 BUSINESS OBJECTIVES................................................................................................................2
1.9 ENTRY AND GROWTH STRATEGY............................................................................................3
CHAPTER TWO.........................................................................................................................................4
2.0 MARKETING PLAN........................................................................................................................4
2.1 CUSTOMERS...................................................................................................................................4
2.2 MARKET SHARE............................................................................................................................4
2.3 COMPETITION................................................................................................................................5
2.4 PRICING STRATEGY.....................................................................................................................5
2.5 SALES TACTICS.............................................................................................................................5
2.6 ADVERTISING AND PROMOTIONS............................................................................................6
2.7 DISTRIBUTION STRATEGY..........................................................................................................6
CHAPTER THREE....................................................................................................................................7
3.0 ORGANISATION AND MANAGEMENT......................................................................................7
3.1 MANAGEMENT TEAM..................................................................................................................7
3.1.1MANAGER.....................................................................................................................................7
3.1.2 PROCUREMENT MANAGER......................................................................................................8

i
 3.1.3SUPERVISOR.................................................................................................................................8
3.1.4 ACCOUNTANT.............................................................................................................................8
3.1.5 SECRETARY.................................................................................................................................8
3.2 REMUNERATIONS.........................................................................................................................8
3.3 STAFFING/OTHER MEMBERS......................................................................................................8
3.4 RECRUITMENT, TRAINING AND PROMOTIONS......................................................................9
3.5 THIS WILL BE THE POLICY THAT COVERS JOB GRADING AND GENERAL WAGES................................9
3.6 LEGAL REQUIREMENTS.............................................................................................................10
3.7 PROFESSIONAL ADVICE AND SUPPORT SERVICES.............................................................10
MEDICAL SERVICES.........................................................................................................................10
CHAPTER FOUR....................................................................................................................................11
4.0 OPERATIONAL /PRODUCTION PLAN.......................................................................................11
4.1 PLANT FACILITIES AND EQUIPMENTS...................................................................................11
4.2. PRODUCTION STRATEGY.........................................................................................................12
4.3. PRODUCTION PROCESS............................................................................................................13
4.4. REGULATIONS AFFECTING OPERATION..............................................................................13
CHAPTER FIVE......................................................................................................................................15
5.1 PRE-OPERATIONAL COST.................................................................................................................15
5.2 BUSINESS PROFORMA CASH FLOW STATEMENT FOR THE YEAR ENDING 31ST
DECEMBER 2023................................................................................................................................16
5.3 BUSINESS PROFORMA CASH FLOW FOR THE YEAR ENDING 31ST DECEMBER 2024
...............................................................................................................................................................17
5.4 BUSINESS PROFORMA CASH FLOW FOR THE YEAR ENDING 31ST DECEMBER
2025.......................................................................................................................................................18
5.5. PERFORMA INCOME STATEMENT..........................................................................................19
5.6. KISORIO'S ELECTRICAL AND ELECTRONIC SHOP PROFORMA BALANCE SHEET.......20
5.7. KISORIO'S ELECTRICAL AND ELECTRONIC SHOP BREAK EVEN POINT FOR YEARS
2022,2023 AND 2024............................................................................................................................21
5.8. RISPAH ENTERPRISE PROFITABILITY RATIOS FOR THE YEAR ENDING 2023,2024 and
2025.......................................................................................................................................................22
5.9. DESIRED FINANCING.................................................................................................................23
PROPOSED CAPITALIZATION.........................................................................................................23
CHALLENGES.....................................................................................................................................24

ii
RECOMMENDATION.........................................................................................................................24
CONCLUSION.....................................................................................................................................24
APPENDIX 1........................................................................................................................................25
REFERENCES......................................................................................................................................26

iii
iv
 CHAPTER ONE
1.0 BUSINESS DESCRIPTION

1.1 THE SPONSORS

The business will be sponsored and financed by the owner called KISORIO
GEOFREY a Kenyan resident of Nandi County. He went to AIC Taunet primary,
proceeded to Henry Kosgei High school and is doing his certificate in Electrical
and electronics engineering at Ol’lessos technical training institute.
He gained the knowledge and the idea after learning business skills in the
vocational training college, brainstorming and later came up with the idea.

1.2 BUSINESS IDENTITY/ LOCATION

The business name will be KISORIO'S ELECTRICAL AND ELECTRONIC
SHOP
P.O BOX 115,
NANDI HILLS.
Contact: 0729532470
Email: [email protected].
The proposed business is intended to be located in soi-sitet town along soi-sitet
road. The business location is suitable because it intends to attract customers who
normally use that shopping market.

1.3 FORMS OF OWNERSHIP/ BUSINESS STATUS

The business will solely be sole proprietorship type of business. The owner will
be KISORIO GEOFREY a competent hardworking young man equipped with
relevant skills in Human resource Management. The business will be new and
intends to win more customers. The firm registration is ongoing and opens
November 2020.

1
1.4 TYPES OF BUSINESS
The business will be a processing as well as assembling type of business where it
will deal with importing parts of electrical machines, gadgets, ad appliances
assembles them to come up with a whole working equipment. Electrical energy
saving machines, appliances and gadgets involved in the business will be single
phase and three- phase machines both a.c and d.c, motors, generators, lighting
accessories and switch gears.
1.5 THE PRODUCTS
KISORIO'S SHOP will have provision for all types of electrical related products
to suit the desires of all customers at all times. The products offered include A.C
and D.C machines and generators, lighting accessories, cables etc
All customers who will be buying bulky equipments will enjoy free transport and
delivery of the product bought while those buying goods worth over Ksh.5000/=
and above will be given 10% discount on the goods.

1.6 JUSTIFICATION OF PRODUCTS

Due to high cost of power and bills, the owner to be conducted a research and saw
the need of starting a business firm to sell and supply energy saving electrical
equipments of high quality.
The business will try its best to make sure it adheres to serving its customers with
genuine, quality and durable products.

1.7 THE INDUSTRY

The business lies under assembling industry hence will require skilled workers
and it will also rely on manufacturing industries for its parts of products.

1.8 BUSINESS OBJECTIVES

The business will aim at satisfying its customers by developing good
relationship with them through fair prices and also fair remunerations to its
workers. The business also aims at maximum profit in its venture and this will
be achieved through hard work and good services

2
1.9 ENTRY AND GROWTH STRATEGY
The business will often use advertisements both media and billboards to press
its entry into the competitive markets.
The advertisement will cost; i) Billboards K.sh 4000/=
ii) Media K.sh 10000/=
The business will also improve good relationship between workers and
customers to reach its maximum performance. The business has plans to install
other bigger shop in Kapsabet town to make sure the business keeps on
growing consistently.

3
 CHAPTER TWO
2.0 MARKETING PLAN

2.1 CUSTOMERS
The business will target a variety of customers within the town and it’s proxims
ranging from individuals, industries and institutions. These customers will be
won by the business firm because it will be offering quality products which
institutions, hospitals and schools mostly believe in genuine products.

2.2 MARKET SHARE

The business will automatically face stiff competition in the market hence has
plans put in place that will enable it to stand firm and compete strongly with
others. The expected starting market share will be 30% of the total shares but
as time elapses the business will be growing by 10% each year.
This will be possible as the business will be offering quality products at an
affordable price.
Growth potentiality of market share is shared among other business

4
 Sales

30 30

kitale shop
khetias supermarket

40

2.3 COMPETITION
The business will not be excluded from the competitive market environment
hence the owner has analyzed competitors weaknesses and strengths. The
owner has visited khetias several times and their weakness was that they don’t
have all the products KISORIO'S SHOP is going to offer especially machines
and also lacks skilled personnel who can be consulted by customers for queries
when it comes to installation. KISORIO'S SHOP offers energy saving products
an advancement from the non-energy savers.

2.4 PRICING STRATEGY

Pricing of products will require careful calculations to determine expenses
involved in purchasing, transportation and distributing them. The overall prices
for the products will be variable depending on the type of machine and its
complexity.

5
 Discounts will be allowed to customers depending on the amount spend in
purchasing the products i.e exceeding 5000/= one enjoys 10% discount.
The business owner will also put up some measures/restrictions so that the
offer of discounts will be a beneficiary to both customers and the business.
Discounts will not be fixed.

2.5 SALES TACTICS

The business will use various methods in order to improve its sales. The firm is
going to make sure its selling its products physically from the shop and also
customers from far will be allowed to buy products online and leave their
address contacts to the business firm for delivery of their products. This tactic
will be embraced by many since no extra fee is incurred for them to get the
products. Also sales agent will be motivated on discount basis depending on the
products sold.

2.6 ADVERTISING AND PROMOTIONS

The business will use billboards, printed-paper and electronic media to
advertise its potential products. This will be done daily on face book and
television sets for the first 6 months. Also the business will conduct an
exhibition of its products once a year so as to win potential customers after
which the frequency of advertising will decline slightly.
Each product will have an after sell e.g. a calendar showing all potential
products offered by KISORIO'S SHOP
Advertisement and promotional budget will amount to 20000/=
Advertisement 13000/=
Promotional 7000/=

2.7 DISTRIBUTION STRATEGY

The business will not guarantee automatic supply of goods to customers unless
otherwise stated, that is those who will meet the rules and regulations governing
the sales and purchase of products.
KISORIO'S SHOP will import energy saving parts of machines and other
products.

6
 Below is a flow chart for distributing.

MANUFACTURER

CUSTOMERS

CHAPTER THREE
3.0 ORGANISATION AND MANAGEMENT

3.1 MANAGEMENT TEAM

MANAGER

KISORIO'S ELECTRICAL
AND ELECTRONIC SHOP
SUPERVISOR ACCOUNTANT PROCUREMENT MANAGER

SECRETARY

7
Organization in the firm is as shown on pg 6
3.1.1MANAGER
The business manager will be the owner of the firm. He will be Mr KISORIO
GEOFREY a certificate holder in Human Resource Management. She will solely
be responsible in the general ownership and supervision as well as administration
of the business.

Duties

i. Planning and controlling all business activities.

ii. Recruiting, motivating and dismissing employees.
iii. General supervision of all activities including business transactions.

3.1.2 PROCUREMENT MANAGER

Should be a diploma holder in procurement and chain supplies with 2 years
experience, should be honest and trustworthy. He or she will be in charge of the
procurement process of the business.

3.1.3SUPERVISOR.
Should be certificate holder in either electrical engineering (craft) and should have
at least 2 years experience as well as good customer- employee communication
skills. He will supervise workers in the firm.

3.1.4 ACCOUNTANT
Should be 26-35 of age, be a holder of CPA I, II, III and trustworthy. He or she
will be in charge of the business’s cash inflow and outflow transactions.

3.1.5 SECRETARY
Should be 25-35 of age have at least craft certificate in secretarial studies or related
field, have good customer care communication skill and ready to work hard. He or

8
she will be in charge handling mail, letters, and receptioning and also writing mails
and sending them. Computer literate will be an added advantage.

3.2 REMUNERATIONS
Procurement manager 25000
Accountant 20000
Secretary 17000
Supervisor 17000
TOTALS 79000

3.3 STAFFING/OTHER MEMBERS

Security personnel
The firm will require security personnel to safeguard the shop and respond to
alarms when necessary. This will be leased to VINKI security group and at cost
of 3000/= per month.
Cleaners and installation personnel
The business firm will require installation personnel’s who will be available for
consultancy and hiring for installation of machines, electrical equipments and
also will do repairs of the same.
The firm will require 2-electricians, holders of craft certificate in electrical with
2- years experience.
Remuneration for each will be 20000/=.
Cleaners will also play an important role by making sure offices and the store
is clean always. No qualification required a certificate /recommendation letter
from a safety and disaster management will be an added advantage. The firm
requires 3 workers remunerations’ will be 7000/= monthly.
3.4 RECRUITMENT, TRAINING AND PROMOTIONS
The business will use newspapers as well as electronic media to advertise job
vacancies and those interested having required qualifications will be free to
apply and deliver their applications with a non-refundable fee of 600/=. Only
successful applicants will be contacted.

9
 Training of workers’ will be done once every month. The business will offer
free trainings and the first one will be to all workers and staff on arrival will
undergo a safety and first aid training at the business premises.
Promotions for KISORIO'S SHOP workers will be as the business proceeds.
This will be given to the hardworking employees only.
3.5 THIS WILL BE THE POLICY THAT COVERS JOB GRADING AND GENERAL WAGES
Personnel Salary (Ksh) Allowances (Ksh) Gross pay (Ksh)
p.m
Manager 30000 2200 32200
Procurement 25000 2000 27000
manager
Accountant 20000 1800 21800
Secretary 17000 1800 18800
Supervisor 17000 1500 18500
Technicians 20000 1500 21500
Cleaners 7000 1500 8500
TOTALS 136000 12300 148300

3.6 LEGAL REQUIREMENTS.

The business will need to abide by government rules and regulations and this
will be through complying by having legal documents authorizing the running
of the business. The owner will acquire these documents from the county
government of Nandi.
i. License
The document which is given by the local authority as a way of
registering the business firm this helps the government to collect revenue
from it and KISORIO'S SHOP will pay 3600/= per annum.
ii. Insurance cover
The cover that protects property and products incase o any risk such as
fires. African Merchants Company Limited (AMACO) has insured
the business at a fee of 1000/= per annum.
iii. Labour laws
The law dictates that when employees work extra time he/she will be
paid for the extra time.

10
3.7 PROFESSIONAL ADVICE AND SUPPORT SERVICES

MEDICAL SERVICES
The business has registered with NHIF and pays the fee required for its
employees 500/= per each. Hence all are entitled to medical services.

I. Postal services
Will cover the sending and receiving of mails and letters, this service
will be handled by Huduma center Kenya (kapsabet branch)

CHAPTER FOUR

4.0 OPERATIONAL /PRODUCTION PLAN

4.1 PLANT FACILITIES AND EQUIPMENTS

The business firm will be requiring to purchase to purchase several equipments
and machines for use within the business firm and also those that will be sold.
Components required are

Item Quantity Cost per unit Total Cost Supplier

(ksh) (ksh)
Stationery 2-dozen 3000 6000 Kericho
stationers
Computers 2 25000 50000 Microsoft
Telephone 2 15000 30000 Safaricom
Counters 2 4000 8000 Finlay’s
workshop
Chairs 10 800 8000 Cherube
11
 engineering
Lighting 5-415V lamps 1200 6000 Kenya power
Shelves 10 1500 15000 Finlay’s
workshop
TOTALS 50500 123000

The maintenance of the equipments in the business firm will be a contract

given to mavoko’s (engineering department).
Transport tracks and pickups will be leased from Dady transpoters at a fee of
20000/= per month.

Plant/business layout
EXIT

PROCUREMENT ACCOUNTS STORE AND SERVICE

OFFICE OFFICE BAY

EQUIPMENT STORE

MANAGER’S

OFFICE

SECRETARY’S OFFICE 12
 ENTRY

4.2. PRODUCTION STRATEGY

The owner intends to ensure that the business runs effectively. Hence all workers
within the firm will be required to have high skills, hardworking and ready to work
under pressure where necessary.

Customers will be taken care of by the business in that those who will buy goods
worth more than 5000/= shillings will be given a 6% discount and those who buys
goods worth 30000 and above will enjoy free delivery and 6% discount.

The business will also offer other extra services like installations, machines
services and repairs within the town and its outskirts and this will be achieved
because the business has skilled trained workers in that field.

Products Quantity Amount (Ksh)

A.C motors Single-phase 7 315000
A.C motors 3-Phase 4 385000
D.C Machines 5 40000
Cables 10-Rolls 8000
Isolators 4 4000
Circuit Breakers 100 20000
Distribution Boards 10 70000
Flourescent lamps 60 4500
Contactors 10 20000
TOTALS 898500

13
4.3. PRODUCTION PROCESS
The production process will be used in restocking of the shop. This will include the
firm procurement manager writing an enquiry note to our suppliers who will then
after receiving check the availability and confirm the availability of the enquired
items and send an answer so us the purchase takes place after which products will
be transported to the shop with a delivery note.

On the same production process some of the problems that will be incurred are
transport issues e.g. vehicle breakdown, security problems, delays on delivery and
also genuity of the products. Considering this factors the firm will ensure that it
orders the products early to avoid rush hours and also to make sure security of the
purchased products is maximum as well as confirm the genuity of the products
bought.
4.4. REGULATIONS AFFECTING OPERATION
Trade licensing

The business will always face such challenges as payment of legal fee needed by
the government in form of revenue and licenses in order to start and run the
business or else faces closure and prosecution.

This issue will be dealt by always paying the legal fee early enough to avoid the
interruption of the business.

Labour laws

The laws that covers the rights of employees dictates that incase of any extra time
worked by an employee he/she has the right to demand extra payment for the extra
time worked for also they have the right to miss coming to work when sick or
when called for official meetings and demand payment for the missed time

Health Act

The business will have to comply with the health act by enhancing clean
environment and good sanitation which will be acquired at fee of 3000/= per
month hence influences the profitability ratios of the business

14
 CHAPTER FIVE
5.0 FINANCIAL PLAN
5.1 PRE-OPERATIONAL COST
KISORIO'S SHOP will need various items and services before commencing its
service. This services paid for and equipment purchased are displayed below

Item Amount (Ksh)

Equipments and installations 15000
Trading license 5000
Water Deposit 1200
Electricity Deposit 2000
Telephone 2000
Renovations 3000
Starting Inventory 30000
Professional fees 8000
Advertising and information (opening) 3000

15
TOTALS 69200

16
 5.2 BUSINESS PROFORMA CASH FLOW STATEMENT FOR THE YEAR ENDING 31ST DECEMBER 2023
PARTICULARS JAN FEB MARCH APRIL MAY JUNE JULY AUGUST SEPT OCT NOV DEC TOTALS
CASH INFLOW KSH KSH KSH KSH KSH KSH KSH KSH KSH KSH KSH KSH KSH
BEGINNING CASH 294570 274570 292750 306210 317960 334080 348040 337030 358070 389600 489100 601100 4342960
SALES 105000 100000 130000 150000 180000 170000 109000 200000 300000 304000 39000 450000 2589000
DEBTORS 20000 20000 30000 70000 40000 90000 70000 80000 75690 87900 800000 30050 670550
TOTAL INFLOW 419570 394570 452760 526210 537960 594050 527040 637030 448070 755100 608100 1081050 5981520
CASH OUTFLOW
PURCHASE 50000 75000 81200 50000 30000 67000 75779 60600 40500 78354 45600 90000 636300
WAGES 148300 148300 148300 148300 148300 148300 148300 148300 148300 148300 148300 148300 1779600
INSURANCE 3600 3600
TRANSPORT 4500 4500 4500 4500 4500 4790 4700 4590 4700 4800 5000 4000 41500
ELECTRICITY 2000 3000 1800 1500 3000 2500 2000 2000 3000 2500 4000 4000 27300
ADVERTISMENT 1000 1000 1000 1000 1000 900 900 900 800 700 1000 500 10000
RENT 24000 - - - - - - - - - - - 24000
LOAN 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 24000
REPAYMENT
LOAN ON 300 - - - - - - - - - - - 3600
INTREST
WATER 250 300 200 300 450 450 500 600 520 130 700 800 2750
CREDITORS - 15000 10000 4000 2000 3000 5000 5000 4000 3000 2000 4000 55000
STATIONARIES 1000 600 500 200 - - - 700 300 200 500 350 4500
LICENSE 7000 - - - - - - - - - - - 7000
MISCELLENEOUS 9355 - - - - - - - - - - - 9355
TOTAL OUTFLOW 213300 236250 210950 196200 192450 205450 218300 210950 213300 19620 218300 210960 1967705
NET CASH 206270 158320 241218 330010 345510 388600 308740 426080 211820 544150 394800 884850 5013815

17
 5.3 BUSINESS PROFORMA CASH FLOW FOR THE YEAR ENDING 31ST DECEMBER 2024
PARTICULARS JAN FEB MARCH APRIL MAY JUNE JULY AUGUST SEPT OCT NOV DEC TOTALS
CASH INFLOW KSH KSH KSH KSH KSH KSH KSH KSH KSH KSH KSH KSH KSH
BEGINNING CASH 294570 490000 305750 306210 437960 334080 348040 337030 358070 389600 489100 677900 4342960
SALES 105000 100000 130000 150000 180000 170000 109000 200000 300000 304000 39000 450000 2589000
DEBTORS 20000 20000 30000 70000 40000 90000 70000 80000 75690 87900 800000 30050 670550
TOTAL INFLOW 419570 394570 452760 526210 537960 594050 527040 637030 448070 755100 608100 1081050 5981520
CASH OUTFLOW
PURCHASE 50000 75000 81200 50000 30000 67000 75779 60600 40500 78354 45600 90000 636300
WAGES 148300 148300 148300 148300 148300 148300 148300 148300 148300 148300 148300 148300 1779600
INSURANCE 3600 3600
TRANSPORT 4500 4500 4500 4500 4500 4790 4700 4590 4700 4800 5000 4000 41500
ELECTRICITY 2000 3000 1800 1500 3000 2500 2000 2000 3000 2500 4000 4000 27300
ADVERTISMENT 1000 1000 1000 1000 1000 900 900 900 800 700 1000 500 10000
RENT 24000 - - - - - - - - - - - 24000
LOAN 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 24000
REPAYMENT
LOAN ON 300 - - - - - - - - - - - 3600
INTREST
WATER 250 300 200 300 450 450 500 600 520 130 700 800 2750
CREDITORS - 15000 10000 4000 2000 3000 5000 5000 4000 3000 2000 4000 55000
STATIONARIES 1000 600 500 200 - - - 700 300 200 500 350 4500
LICENSE 7000 - - - - - - - - - - - 7000
MISCELLENEOUS 9355 - - - - - - - - - - - 9355
TOTAL OUTFLOW 213300 236250 210950 196200 192450 205450 218300 210950 213300 19620 218300 210960 1967705
NET CASH 206270 158320 241218 330010 345510 388600 308740 426080 211820 544150 394800 884850 2230085

18
 5.4 BUSINESS PROFORMA CASH FLOW FOR THE YEAR ENDING 31ST DECEMBER 2025
PARTICULARS JAN FEB MARCH APRIL MAY JUNE JULY AUGU SEPT OCT NOV DEC TOTALS
ST
CASH INFLOW KSH KSH KSH KSH KSH KSH KSH KSH KSH KSH KSH KSH KSH
BEGINNING 294570 274570 292750 306210 317960 33408 348040 33703 358070 389600 489100 601100 6752960
CASH 0 0
SALES 105000 100000 130000 150000 180000 17000 109000 20000 300000 304000 39000 450000 2509000
0 0
DEBTORS 20000 20000 30000 70000 40000 90000 70000 80000 75690 87900 800000 30050 676550
TOTAL 419570 394570 452760 526210 537960 59405 527040 63703 448070 755100 608100 1081050 5561520
INFLOW 0 0
CASH
OUTFLOW
PURCHASE 50000 75000 81200 50000 30000 67000 75779 60600 40500 78354 45600 90000 631300
WAGES 148300 148300 148300 148300 148300 14830 148300 14830 148300 148300 148300 148300 1779600
0 0
INSURANCE 3600 3600
TRANSPORT 4500 4500 4500 4500 4500 4790 4700 4590 4700 4800 5000 4000 41500
ELECTRICITY 2000 3000 1800 1500 3000 2500 2000 2000 3000 2500 4000 4000 27300
ADVERTISME 1000 1000 1000 1000 1000 900 900 900 800 700 1000 500 10000
NT
RENT 24000 - - - - - - - - - - - 24000
LOAN 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 24000
REPAYMENT
LOAN ON 300 - - - - - - - - - - - 3600
INTREST
WATER 250 300 200 300 450 450 500 600 520 130 700 800 2750
CREDITORS - 15000 10000 4000 2000 3000 5000 5000 4000 3000 2000 4000 55000
STATIONARIES 1000 600 500 200 - - - 700 300 200 500 350 4500
LICENSE 7000 - - - - - - - - - - - 7000
MISCELLENEO 9355 - - - - - - - - - - - 9355
US
TOTAL 213300 236250 210950 196200 192450 20545 218300 21095 213300 19620 218300 210960 1967705
OUTFLOW 0 0
NET CASH 206270 158320 241218 330010 345510 38860 308740 42608 211820 544150 394800 884850 2000000
0 0

19
5.5. PERFORMA INCOME STATEMENT
Particulars 2023 2024 2025
SALES 927000 1237000 1539000
LESS PURCHASES 386000 539000 694000
GROSS PROFIT 511000 697000 845000
EXPENSES
SALARIES 321600 420000 420000
RENT 24000 24000 24000
INTREST ON 3600 4800 4800
LOANS
INSURANCE 8400 8400 8400
TRANSPORT 50800 45700 44400
ELECTRICITY 10030 8950 9900
ADVERTISEMENT 5900 4850 6050
MISCELLENEOUS 6500 3800 3800
WATER 6120 4000 4650
STATIONERY 6040 4750 3950
LICENSE AND 4000 4000 4000
REGISTRATION
TOTAL EXPENSES 434990 521250 521950
NET PROFIT 106010 176250 323050
LESS 15% Tax 15902 26438 48458
NET PROFIT 90108 90108 149812
AFTER Tax

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5.6. KISORIO'S ELECTRICAL AND ELECTRONIC SHOP PROFORMA BALANCE
SHEET
Particulars 2023 2024 2025
FIXED ASSETS Ksh Ksh Ksh
Machinery and 80000 75000 88000
Equipment
Furniture and 65000 40000 45000
Fittings
TOTAL FIXED 145000 115000 133000
ASSETS
CURRENT Ksh Ksh Ksh
ASSETS
Cash at Bank 200000 1500000 2000000
Cash at Hand 60000 70000 85000
Stock 100000 100000 150000
Debtors 70000 90000 150000
TOTAL 430000 1760000 2385000
CURRENT
ASSETS
TOTAL ASSETS 575000 1875000 2518000
CURRENT Ksh Ksh Ksh
LIABILITIES
Creditors 55000 105000 75000
TOTAL 55000 105000 75000
CURRENT
LIABILITIES
LONG TERM Ksh Ksh Ksh
LIABILITIES
Bank loan 890000 700000 650000
Equity 77000 87548 47080
NET PROFIT
TOTAL 1022000 892548 772080
LIABILITIES

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5.7. KISORIO'S ELECTRICAL AND ELECTRONIC SHOP BREAK EVEN POINT FOR
YEARS 2022,2023 AND 2024
Particulars 2023 2024 2025
B.e.p=Fixed
cost*Sales
349600*927000/927 449200*1237000/12 449200*1539000/15
Sales 000-611050
37000-611050 39000-766750
variable =712089
=887707
=895201

FIXED COST 2023 2024 2025

Rent 24000 24000 2400
Salaries and wages 1776000 1776000 1776000
Insurance 3600 3600 3600
License and registration 7000 7000 7000
TOTAL FIXED COST 1810600 1810600 1810600
VARIABLE COSTS
Purchases 636300 867000 900000
Electricity 27300 14115 18000
Water 2750 8850 90000
Advertisement 10000 6650 7000
Stationery 4000 8300 5000
Transport 41500 43400 45000
Miscellaneous 9355 9000 9500
TOTAL VARIABLE 731205 957315 993500
COSTS

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 5.8. RISPAH ENTERPRISE PROFITABILITY RATIOS FOR THE YEAR ENDING
2023,2024 and 2025
Ratio Type Working 2023 2024 2025
Gross Profit Gross*100/Total 5013815*100/2589000 2230085*100/16852 2000000*100/1800
Margin sales =193% 00 000
=132% =111%

Return on Equity Profit per 90108*100/10000 14812*100/100000 276592*100/10000

(ROE) tax*100/Owners = 90% =150% 0
Equity =277%

Return on Profit after 90108*100/250000 149812*100/250000 27692*100/250000

Investment tax*100/Total =36% =60% =111%
investment

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5.9. DESIRED FINANCING
The desired financing for the proposed business will be as follows

Items Amount
Pre-Operational Cost Ksh
Machine to Equipment 20000
License and registration 7000
Rent 24000
Insurance 3600
Advertisement 23650
TOTALS 78250
Stock 100000
Cash 21500
Bank 1500000
Debtors 150000
TOTALS 421500

PROPOSED CAPITALIZATION.
The business will be financed by

SOURCE AMOUNT
OWNERS EQUITY 100000
LOANS 150000
TOTAL INVESTMENT 250000

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 CHALLENGES
I) The business is tough to start since it involves taking risks
II) Loan guarantee is a problem since the business has no title deed
RECOMMENDATION
I) Loans should be provided to applicants without title deeds but
provided the applicant presents his/her ID card (national)
II) The business should reduce employees like day time security
personnel’s so as to enjoy its profit
III) A software should be in place for accurate calculation of the
business cash figures
CONCLUSION
It was a great adventure involving myself in writing a business plan and assuming
to be able to manage and also raise 250000/= shillings.

This writing is very important as it has equipped me with skills in management of

business as I know how to start and to stretch hands out there

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 APPENDIX 1
BUSINESS MAP LOCATION

SOI-SITET TOWN SOI-SITET SHOW

T
PROPOSED BUSINESS SHOP O

K
I
M TO ELDORET
I
N
I
SHELLS PETROL STATION

26
REFERENCES
1. Internet
www.entrepreneurship.com
2. TITLE; A BUSINESS PLAN FOR LIFE
AUTHOR: ANN M MARTHA.
EDITION: 2nd
3. TITLE: STEP BUSINESS PLAN
AUTHOR: ANGELA ACKERMAN
EDITION: 3rd

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