BUSINESS PLAN FOR THE ESTABLISHMENT OF A

CAR HIRE BUSINESS

Business Name: Eagle Eye car Hire

Director: Tsholofelo Magole
Location: Mochudi
Phone No.: +26774368103
Email Address: tsholofelomagole@gmail.com

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1.0 EXECUTIVE SUMMARY

Eagle Eye Car Hire is a registered startup company that will specialize in the
provision of car hire services in Kgatleng district. This business will be owned by
Mr Tsholofelo Magole. All the management functions such as planning, organizing,
controlling, coordinating, directing and general leadership will be done by the owner
who is the Director of the company. A Kaizen (continuous improvement) principle
will be a key factor for the success of the company. Therefore, key inputs from
stakeholders such as customers and employees will be utilized in the company’s
decision making process.

Mochudi has been strategically chosen as the right place to start this profitable
business due to among other things, huge market prospects, near proximity to key
suppliers and good infrastructure such as roads, communication and electricity.

Market research has revealed that the demand for car hire services has been on the
upswing, in Mochudi and surrounding areas. This is partly due to huge population,
and increased economic activities .However, this demand does not correspond
with the supply. This has on several occasion left customers on the disadvantage
side. As a result customers are left with little choice but to get poor quality services
at expensive prices. We realized this need and we want to come in and fill this gap
so that our valued customers are provided with top notch services at affordable
prices. Among our competitive advantages include strategic location, good
management and flexibility to meet and exceed customer expectations.

All things being equal this project is going to cost about P509,145. This figure
factors all the expenses involved for the successful operationalization of the
project. The costs involve cost of vehicles, labour, fixed assets, overheads,
communication, marketing and other hidden costs plus a provision for 5%
contingency.

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 We will run the business in a cost effective manner. All costs will be kept to the
minimal but at the same time paying particular attention to quality and customer’s
value for money in mind. We project to be commissioned by November 2019.

2.0 VISION

To become Botswana’s premier provider of top quality car hire services with a
presence in all the Districts in Botswana.

3.0 MISSION STATEMENT

To provide the most cost effective, quality efficient and transparent

products/services, paying great attention to every detail of every job regardless of
size. We want to be among the top five in Kgatleng within our fifth anniversary.

4.0 CORE VALUE

A Integrity
A Professionalism
A Excellence
A Commitment
A Honesty
A Customer care
A Ethical
A Responsible

5.0 GOALS

A To secure a reputation of high quality products and services backed by a high

calibre of management
A To have unparalleled commitment to customer care/service
A To complete and deliver all our jobs on time and within the budget

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 A To build a solid foundation of both quality products and prices regardless of
size of budget involved

6.0 OBJECTIVES

We will put a number of objectives to serve as performance yardsticks. These

objectives will be smart in nature

S Specific
M Measurable
A Attainable
R Realistic
T Time bound

Any possible deviations for set targets will be re-examined and remedial measures
immediately put in place.

6.1 SHORT TERM OBJECTIVES

A Creation of eight(8) direct jobs

A To make annual sales of P842,400 by November 2020
A Realizing an annual net profit of P318,016 by November 2020

6.2 LONG TERM OBJECTIVES

A To cast our nets wider and consider opening another branch in Modipane
by 2021
A To raise funds for capital projects e.g buying of more vehicles and other
fixed assets that promote growth for the business
A Creation of five (5) direct jobs by 2020
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7.0 BUSINESS OWNERSHIP

The business is owned by Mr Tsholofelo Magole . It is a registered legal entity

under the Companies and Intellectual Property Authority (CIPA) under certificate of
Registration Number BW00001282946 dated 7th August 2020. Mr Magole is
the Director and will provide leadership and strategic management to see the
company grow to another level.

Qualified employees will be hired and this will ensure good management for the
poultry farm. Although the director will be making key business decisions, planning,
directing, controlling, coordinating and other management functions, he will listen
to employees and customer feedback (both positive and negative) in order to
improve the way the business will be run. We will do what the customer wants, not
want we want. The objective is to ensure a first customer, both individual and
corporate, comes back for future purchases. This is key for a young business like
ours. Repeat customers also bring referral customers.

8.0 BUSINESS DESCRIPTION

Business Name : Eagle Eye car hire

Business Address : Mochudi
Business Director : Mr Tsholofelo Magole
Business Phone No/Email :
Business Bank :

9.0 ECONOMIC BENEFITS

Our birth as a company will bring a number of benefits to the economy of

Botswana. The following will be some of the trickle down economic benefits
A Job creation
A Tax contribution to the Republic of Botswana
A Contribution to the Gross Domestic Product (GDP)

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 A Creation of hunger for other entrepreneurs to jump into the band wagon and
emulate us

10.0 KEYS TO SUCCESS

A Offering our valued customers affordable, high quality services at slightly

reduced prices compared to our competitors
A Engaging our customers on a one on one basis and setting their feedback –
both positive and negative so that we improve in certain areas. The key is to
have a smiling customer
A A good sales and marketing strategy will be put in place
11.0 BUSINESS LOCATION

We will be located in Mochudi. This is a strategic location and is near the market
for our services. It is about 30 minutes drive from Central Business District (CBD) of
Mochudi. The place is near suppliers of crucial materials such as auto spare parts
and other consumables. It has access to water and a good road and
communication networks.

Our location will give us a competitive advantage and leverage.

12.0 PRODUCTS

We will be involved in the provision of car rentals ,airport pick ups,large group
transfers ,tour operations, chauffeur services ,school kids pick ups, and related
services.. Our services will be of unmatched quality but affordable to customers.

12.1 COMPETITIVE COMPARISON

A We will offer quality services unmatched to any rival/competitor. This

will be punctuated by a good customer care.
A We will use simple marketing techniques that reduce costs but help
achieve maximum results
A We will use simple marketing techniques that reduce costs but help
achieve maximum results
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 A Our products will meet and exceed our customer expectations

13.0 MARKET ANALYSIS SUMMARY

The economy of Botswana has been steadily improving with a number of people
affording most basic essentials. And car hire is one such. The demand for car hire
is high and we do not expect it to plummet any time soon as it is in fact increasing
every day. This will make us to have a positive growth prospect as a company in the
targeted area of Mochudi.

To meet this demand for this, we are poised and have the capacity to fill in the gap
and supply at a profit.

13.1 MARKET SEGMENTATION

The market is segmented into two: the corporate and individuals and we are
targeting both.

13.2 MARKET TREND

The car hire industry is constantly sprouting and leaving many rigid
companies sluggish .One of the major trends to adapt is technological
advancement and maintaining quality services to our valued customer. We
will make it easier for our customers to place orders online and offer
efficient services to them

13.3 PRICING STRATEGY

Pricing being one of the four Ps in the marketing mix is very crucial in any
business success and growth and we are no exception.

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 Our prices will depend on what is obtainable on the market. However, to
quickly penetrate the market, we will strategically sell our services at slightly
reduced prices.

14.0 SALES AND MARKETING STRATEGIES

To remain buoyant in a competitive environment, we will put a number of sales and

marketing strategies from its bag.

Some of such strategies includes:-

A Directly involving potential client’s especially corporate clients through word of

mouth on the availability of our products.
A Leveraging on the internet through various platforms e.g Facebook, whatsapp,
twitter etc so as to reach a high volume of potential clients. In the modern world
technology must be harnessed by any business. A number of people own
cellular phones and have access to the internet at a very low cost.
A Distribution of flyers and catalogues in strategic places e.g big at airports.
A Engage on promotional campaign especially to our loyal repeat buyers
A Introduce our business by sending introductory letters to both residential areas
and corporate clients.,
A Listing on yellow pages/directories for our prospective customers to reach us
easily

15.0 MANAGEMENT AND HUMAN RESOURCES

15.1 Management

For effective and efficient running as well as growth of our business, a good
management system will be put in place. The Director will perform all
management functions of planning, organising, controlling, directing,
coordinating, leadership and decision making for the enterprise. We will also
ensure a team of hardworking qualified employees are in place as this
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 business require competent hands. These will be paid competitive salaries
as a way of motivating them. A motivated employee is more congruent
(putting company interest first before self) and is likely to grow with the
company. This also reduces cases of pilferage.

15.2 HUMAN RESOURCES

Being the most valuable assets not only at Eagle Eye but also in any firm,
humans play a key role

At the inception throughout to the end of year one, we will hire eight(8)
employees to manage daily routines. These will be people who have
qualifications.

The business will employ the Operations manager, an Accountant, a

Secretary, three drivers and two security guards. All employees will be placed
in their right jobs

However, we believe the span of control can be ignored depending on the

nature of objective we intend to achieve. The objective is to get the
results at the right time

16.0 RISK SENSITIVITY

Car Hire, like any other business is susceptible to a number of potential risks that
can hit the business. Some of such potential risks include:-

A Unpredictable and unstable cost of fuel and spare parts. such as New
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 A The risk of price wars by big players who may reduce prices to unreasonable
levels
A Unfavourable government policies that can adversely affect us.

We are, however not afraid to take the risk because the projected benefits
outweigh the costs

17.0 COMPETITOR ANALYSIS

Within the proposed location of Lusaka are a number of competitors. Therefore, we

will not be operating in a vacuum.

To remain competitive and grow the business we will carry out a SWOT (Strengths,
Weaknesses, Opportunities and Threats) analysis. A SWOT analysis is a business,
appraisal system of analyzing how a business is doing in relation to its
environment. Environment in this context is the competitions. SW (Strengths and
Weaknesses) are internal factors that affect a business e.g a good location or lack
of a good marketing strategy respectively.

OT (Opportunities and Threats) are external factors e.g a continuous demand for
products and economic meltdown respectively. A threat could also be price wars
or aggressive competition.

Other macro environmental factors to consider includes:-

P Political
E Environmental
S Social / Cultural Norms
T Technology
E Economical
L Legal Issues
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17.1 SWOT ANALYSIS FOR US

STRENGTHS WEAKNESSES
A Good location A New in the business
A Quality affordable products A Cant lower prices further
A Good marketing and sales A No repeat customers yet
prowess

OPPORTUNITY THREATS
A Continuous demand for services A Possible economic down
turn that may affect
customer buying power
A Room and enough capacity to A Expensive unstable fuel
increase/grow our production cost

17.2 SWOT ANALYSIS FOR ONE COMPETITOR – NAME WITH HELD FOR
CONFIDENTIALITY

STRENGTHS WEAKNESSES
A Well established A Poor location
A Has the capacity / qualified A Poor customer care

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 staff
A A expensive services

OPPORTUNITY THREATS
A Continuous demand for services A Lacks the technology
and uses old systems
A High cost of fuel

Though we have competitors none will equal to our quality customer care
and flexibility. Further, most of our competitors are on a smaller scale and
lack the consistency.

18.0 OPERATING PLAN

18.1 FIXED ASSETS REQUIREMENTS

Item Qty Cost (P) Total (P)

Motor vehicle( vvti) 03 70,000, 210,000,
Motor vehicle9 mercedes 01
130,000 130,000,
benz
Rosa bus 01 90,000 90,000,
furniture 7,000 7,000,
computers 02 3,000 6,000
,

Total 443,000

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18.1 DEPRECIATION ON FIXED ASSETS/ANNUM

Item Cost (P) Dep Dep Cost Net Book

Rate Value
vehicles 430,000, 25 % 107,500 322.500
Furniture and 13,000, ,.11,700,
10% 1,300,.
computer
443,00 334,200
108800
0 ,

Total annual depreciation cost: P 108,800 calculated by the straight line method.

,,/

18.2 OVERHEAD COSTS/MONTH

Item Cost (P)
Office rent 3,000
Marketing 700
Electricity 300
communication 400
repairs 4,000
Total 8,400

Annual overheads:, P100,800

18 .3 PROJECTED SALES
Vvti k400 per day times 3 giving P1,200
Mercedes benz P600 per day
Bus P900 per day
Total sales P2,700
The business will operate 26 days in a moth. So, total sales per month will be P70,200 and
P842,400 per annum
18. 4 COST OF LABOUR/WAGES
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 The business will employ eght (8) workers to enable it achieve its smart
objectives..The total monthly wage bill will be P15,000
Operations manager P3,800
Accountant P2,500
Secretary P1,700
Drivers (3) P1,700
Security guards(2)P 1,000

18.5 TOTAL PROJECT COST

Item Estimated
Cost (P)
Fixed Asset Requirements
Motor vehicles 430,000
furniture 7,000,
computers 6,000
Initial Working Capital Requirements
Feasibility study ,3,000
Salaries – two months 30,000,
Overheads – two months 8,400,
Painting offices 500

insurance- 2,000
,
Business Consultant Fee 500
Total Project Cost 484,900
5% Contingency Added 24,245.
Total Funds Needed to commission the Project 509,145.00

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18.6 FINANCIAL PROJECTIONS
18.6.1 Income Statement for the year ending November 2020
P
SALES 842,400
Less: expenses

Less Expenses
Salaries 180,000,
100,800
Overheads
108,800,
Depreciation
(389,600.)
Net Profit before Tax 452,800.
Tax (134,784)
Profit after Tax 318,016 .

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The business will make an annual Net Profit of P318,016. in its first financial
year. This is 38% of total annual sales.
This will be a viable lucrative business as the entity will be able to pay all its
financial obligations on time and still remain buoyant, bullish and liquid.

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