BUSINESS PROPOSAL

INTRODUCTION

This business plan forms the basis of my request for financial assistance in financing a start-up business.

(…………………..) is an envisioned enterprise that aims at selling and supplying electrical appliances to its clients. The enterprise seeks to meet most of, if not all, the needs that appertain to the provision of electrical appliances that are needed by many of the people in the society today.

SITUATIONAL AUDIT

Within Nairobi, there are many construction sites. This basically implies that as the days go by, many more houses and other permanent structures are being put in place for occupational, office and other reasons that pertain to shelter. With this in mind, many of the structures being put up require electrical installation. This therefore means that many of the residents of Nairobi use electrical appliances in their homes and at their work place.

The scene revolving around the sell and supply of electrical appliances in Nairobi is, however, pitiable! For a long time, the residents of the city have had to rely on the few already established enterprises that deal with electrical appliances. This means that the prices of the goods and commodities sold have been hiked and are at times too high for the client to meet. It also means that the demand for the commodities exceeds the supply owing to the fact that many more permanent structures that require electrical installation are being put up while the number of stores and businesses dealing with the sell and supply of electrical appliances is not increasing at the same rate.

OBJECTIVES

An observation and questioner research carried out in the southern side of Nairobi showed that the residents were in need of an affordable electrical sell and supply enterprise within the region. (……………) bases its objective of being the “leading seller and supplier of electrical appliances in the country”, on this research. In pursuing this objective, the enterprise will offer necessary and attractive services at affordable prices depending on the item required and intended for purchase by the client.

Service offered

As stated in the title page and through the proposal, the primary services offered by the enterprise are:

  • Sell of electrical appliances
  • Supply of electrical appliances

The supply service is characterized by secondary products such as;

  • Installation of the supplied electrical appliances where necessary
  • Repair of electrical appliances if need be
  • Provision of a ready market for the old or unused electrical appliances

Pricing

In order to dominate the market, the enterprise will adopt a pricing policy based on market penetration and profit maximization.

With regards to market penetration, the enterprise will charge relatively and reasonably lower prices for its services than its competitors. Again, the pricing totally depends on the equipment and its current market price.

Profit maximization, on the other hand, will be achieved at by factoring in the existing market price of the equipment and the type of service rendered. In instances where labor is also involved such as the installation process, labor costs will also be inclusive of the charge. A transportation fee will also be charged in the event that a client requires an equipment to be supplied to the area of residence or work. The equipment charges will vary depending on the kind. They will, however, be slightly and reasonably higher than the cost of purchase by the enterprise.

STRATEGY

The strategy formulated by the enterprise to achieve the set objectives involves organizational structure, operational plan and expansion programme.

Organizational Structure

The enterprise will be governed by a General Manager (Myself) who will set the objectives of the enterprise. The General Manager will, however, be assisted by the Sales and Supply Manager and the Finance Manager. The two assisting managers will be on a horizontal platform. They will set the strategies which will enable the enterprise to best attain the set objectives in their respective departments. Additional personnel will also be included in the enterprise to assist in quality service provision. This will be done on a pro-rata basis i.e. the number of personnel will increase proportionally to the enterprise.

All managers and personnel will be recruited on a merit basis.

Operational Plan

The day to day activities of the company are directed by the managers who formulate the strategies which best attain the enterprise objectives.

It will be the mandate of the sales and supply manager to ensure that all the equipment required by the customers and clients are available in the store and are always ready for sale. It will also be his duty to ensure that the services provided are of quality and the enterprise meets the demand of the ready market. The sell, supply and eventual installation of the equipment falls within his/her docket.

The finance manager will be in charge of the ‘books’. The collection, recording, presentation and analysis of financial data, raising finance for the business operation and decision making pertaining to how the finances should be spent, fall within his/her docket. The finance manager will work closely with the sales and supply manager in coming up with affordable charges for the customers that will see to it that profit is maximized for the enterprise. Matters relating to the accounts of the enterprise will also fall under his docket.

The General Manager will oversee the structuring of the workforce. It will be the duty of the GM to source for financing, recruit the management team and see to it that the enterprise realizes its dream of becoming the leading seller and supplier of electrical appliances in the country. A major responsibility vested in the GM is that of also acting as the Personnel and Human Resource Manager. This decision was arrived at owing to the fact that he is also the one to recruit the relevant managers. The recruitment board will, however, comprise of the General Manager and the two assisting managers who will help him in conducting the interviews with the view of employing the best qualified staff. It is, however, in the plan to create the office of the personnel and human resource manager in future. This will depend on the growth of the business.

Expansion Programme

The expansion programme in mind is that of first tapping and taking the market in Nairobi within the first 2-3 years. Having acquired sufficient finances and resource, the enterprise intends to set up branches in all major towns of the country within the next 4-5 years. With the realization of that dream, the Enterprise can now think of going regional i.e. East Africa and later expand to the rest of Africa.

FINANCIAL IMPLICATIONS

For this plan to be realized, a start-up capital of Kshs. 2,500,000 (two point five million) will be required. These finances will go into starting the business and will be allocated as follows:

  • Acquiring office and market space at a cost of 500,000 (five hundred thousand)
  • Purchasing a pick-up track and customizing it for the supply purposes. This should cost approximately 800,000. The truck will be acquired on an installment basis. This type of acquisition will enable the company to have a bigger capacity for capital asset purchase and inception of the business.
  • Financing of initial operational activities such as; registration of the business, purchasing and making uniforms for the staff, provision of petty cash and purchase of the relevant equipment for sale all at a cost of 1,000,000 (one million).
  • Financing the business promotional activities which entail advertising, publicity and sales promotion at a cost of 200,000 (two hundred thousand).

POTENTIAL MARKET

The enterprise targets anyone or any group of persons with electrical installation in their area of occupation. This is due to the fact that everyone with electrical installation requires electrical appliances in the premise. This market opportunity gives the business a wide scope of target market hence magnifying the sales potential of the enterprise. The enterprise will enjoy competitive advantage in the market by offering necessary services which are currently non-existent in the market. These include;

  • Provision of affordable pricing
  • Provision of equipment delivery and installation to the area of occupation
  • Offering client discounts where one deserves one

The enterprise will be able to provide the service all year round. This is guaranteed by the fact that for as long as permanent structures is erected, electrical appliances will be needed.

ENTREPRENEUR COMMITMENT

I am …………………………………………………………………………………….. For many hours I have planned for this and laid down strategies that will see the realization of this dream. I am willing to commit all resources at my disposal towards the realization o this dream. This plan will not only benefit me but the society as a whole by providing employment and a source of income to many.

I, however, do not have the financial resource to inject into this plan and I hope that you will assist me in overcoming this shortfall.