Ashenafi Dimtu

Business Proposal for
Ashenafi Abebe Special Sundry unwashed coffee Processing Industry
Promoter: Mr. Ashenafi Abebe
Project Location:
Oromia Regional State, West Guji Zone, Hambala Wamena Woreda, Damme
Dabaye Kebele
Nehase, 2015 E.c
Dimtu, Ethiopia
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Table of Contents
Executive Summary.....................................................................................................................................2
General Profile Of the project.....................................................................................................................3
1, Background..............................................................................................................................................4
2. Objective of project.................................................................................................................................5
3. Description of the project area.................................................................................................................5
4. Suitability of the Project Area..................................................................................................................7
5. Company Background..............................................................................................................................8
6. Market Plan.............................................................................................................................................9
7. Source of Revenue.................................................................................................................................11
8. Organization and Man power................................................................................................................11
9. Determination of Project Capital...........................................................................................................12
10. Financial Study.....................................................................................................................................15
11. Profit and Loss Statement....................................................................................................................17
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Executive Summary
Mr. Ashenafi Abebe has planned to establish Dry Coffee processing industry in Hambala
Wamana Wereda of West Gujii zone, Oromiya regional state. The industrial project is proposed
to be planted at Damme Dabaye kebele specific site of “Balessa Kilta” locality. The altitude of
the proposed area ranges from 1600-2200m asl and categorized under midland agro-ecology.
The texture class of the soil is characterized by loam, which is high productive, well- drained
and enriched with high level of important nutritional contents.
The proposed project area is about 0.6 ha of land and it is intended to be full of project
activities. In terms of financial requirement, the initial investment cost is estimated to be birr
5,178,327.00; out of which ETB 1,553,498.10(30% of total cost) is from the promoter’s personal
equity and the remaining ETB 3,624,828.90 (70% of the total cost) is expected from bank loan
(Local banks).
The overall objective of the project is mainly to process and supply high quality finished coffee
products to local and global markets.

General Profile Of the project

1. The Promoter: Mr. Ashenafi Abebe
 Nationality :- Ethiopian
 Address: Oromya Region, West Guji Zone, Hambala Wamana Woreda, Dimtu
Mobile 09 41 03 97 84, Po. Box _____
2. The Project
 Location: Oromya Region, West Guji Zone, Hambala Wamana Woreda, Damme
Dabaye kebele
 Type of the project: Sun dried unwashed coffee Processing Industry
 Legality: Legal form of business
 Form of the Business: Sole-proprietorship
 Status of the project: Up grading
 Total investment capital: 5,178,327.00 Birr
 Sources of finances: 30% (Br. 1,553,498.10: Both in Cash & Kind) of the
total investment capital is from owner equity & the rest 70% (Br. 3,624,828.90)
is from Bank loan.
 Land required: More than 0.6 hectares
 Project output: Improved dry quality Y/Cheffe test coffee seed
 Employment opportunity created: 9 permanent and 30 - 50 seasonal
employees
 Licensing agency : Ministry of trade
 Project Beneficiary: The Owner, Workers (community members), Surrounding
coffee growers and the government through taxation.
 Project period: It is completed in one year
 Project Sustainability: After the establishment the project will continuously
process the coffee bean collected from the surrounding coffee growers.

1, Background
Agriculture sector is the largest economic sector for the population predominantly depends on
agriculture activities for its economy and livelihood. In Ethiopia, agriculture accounts for
46.3% of the GDP 83.9% of exports and 80% of the labor force. Many other economic activities
depend on agriculture including marketing, processing and export of agricultural products.
Production is over whelm manly of a subsistence nature and large part of commodity export
are provided by small agricultural cash-crop sector. Principal crop includes coffee, pulse, oil
seed and vegetables.
Coffee is an important commodity and popular beverage over 2.25 billion cups coffee is
consumed in the world every day. Over 25 million small producer relay on coffee for living and
in Ethiopia has more than 85% population who depends on agriculture sector. Now a day’s
Ethiopia economic policy agriculture led industrialization has under taking attractive situation to
promote investment sector .the economic policy created conducive environment for privet
sector to potentially invest in such agriculture sector like that of dry coffee processing
industries. In general the main purpose of this project is by considering the existing suitable
investment condition in the country and also in Oromia regional state. The promoter and
owner of the project Mr. Ashenafi Abebe is attracted and decided to invest and establish sun
dried coffee processing industries in oromya region West Guji zone Hambala wamena woreda
Damme Dabaye kebele.
2. Objective of project
General objective
 To establishes sundry coffee processing industry that would supply high quality
standard dry coffee to the central market and contribute to country economy.
Specific objective
 To produce high quality exportable dry coffee from the project are
 To generates income or profit for the owner of the project

 To caret job opportunity in the project area
3. Description of the project area

Project Area
The assumed project is planned to be located in Oromia Regional State West Guji Zone,
Hambala Wamana Woreda specifically at Baleessa kilta locality. Hambela Wamena is one of
the woredas in the Oromia Region of Ethiopia. It is a part of the West Guji Zone and used to be a
part of Uraga woreda. The 2007 national census reported a total population for this woreda of
104,971, of whom 52,244 were men and 52,727 were women; 1,689 or 1.61% of its population
were urban dwellers. The majority of the inhabitants said they were Protestant, with 73.62% of
the population reporting they observed this belief, while 11.84% of the population practiced
traditional beliefs, 3.97% were Muslim, 3.24% were Catholic, and 2.68% practiced Ethiopian
Orthodox Christianity. Hambala is a moderate highland /Bada Dare/ and lowland /Gamoji/
district with altitudinal ranging from 1100 to 2060m above sea level.
(Source: Woreda Agriculture office)
The availability of up to date, reliable and adequate data on the existing condition of the
distribution, current level of exploitation and degradation of resources is the basis for sound
development planning, proper resource management and conservation. However, there are
problems, which are not allowed to have up to date, reliable and adequate data/information/.
Among the problems encountered while compiling this paper are:
 Absence of available and reliable data in the district.
 Shortage of professional manpower in Woreda.
 Shortage of time to dig out all possible data.
However, efforts have been made to make certain adjustment so as to make the data reflect the
district. Therefore, the document is supposed to explain the socio-economic conditions of the
district.
The sources of data used in this document are from respective District Agricultural Office,
Education Office, Health Office, Finance and Economic Development Office, and other sectors
in the district.

It is reported that 32,815 tons of coffees were produced in this zone in the year ending in 2014;
the lion share, based on inspection records from the Ethiopian Ministry of Agriculture. i.e 14,587
tones were sundry unwashed coffee. This represents that 11.8% of the regional outputs and 6%
of Ethiopia’s total output. But supply of unwashed coffee accounts only 9,957 tones.
In addition, demand for high quality unwashed coffee is increasing in local and international
market from time to time. Having these opportunities the owner planned to establish the plant.
West Guji zone have 9 woreda and 2 city administrations. Among them both woredas’ are coffee
growers including the project proposed wereda, Hambala Wamanna.
Hambala Wamana woreda is found in the West Guji Zone of Oromiya regional states. It is
located at 37 km away from the zone capital town Bule Hora to the North direction, and around
423km away from Addis Ababa, the capital of Federal Republic of Ethiopia, in the southern part
along Ethiopia on the main road, Asphalt. The woreda is bounded with SNNPR (Gedeb zone) in
the west, Oromia regional state (Shakiso wereda) in the East, Oromiya region West Gujii zone
(Haro Wolabu wereda) in the north and Qarcha & Birbirssa kogowa woreda (Oromia) in the Soth
direction. The name of the woreda town is called Dimtu. The project woreda, Hambala Wamana
is a potential area with adequate consideration of the source of coffee. This is the main reason
why to establish this project in the woreda. According to woreda agriculture office report 3000 –
4000 tons of washed coffee and 2500 – 3000 tons of unwashed coffee were produced in woreda
in a year 2012- 2014.
The project site is far around km North West away from the center of capital town of Hambala
Wamana woreda, Dimtu. Hambala Wamana woreda is one of the known and major sources for
the production of best known Guji test coffee. The site area is ideal and more selective for such
coffee processing industry at easily accessible distance for collection of dry coffee cherry from
farmers.
Socio Economic Activities of the Area
About 90% of the population depends on subsistence agriculture and cash crop production. The
majority of the surrounding area people of the projects area are farmers relaying on the coffee
and other agricultural activities.

4. Suitability of the Project Area

Potential for coffee Production:
In Hambala Wamana there are 18 independent peasant associations, which are known by well
coffee production. From the total area it is estimated that about 21,500Hek of land is covered by
coffee plantation.
At small scale farmers at the garden farm and it has estimated that of 12,800 tones of clean
coffee can be obtained from the total hectares. Based on this assumption, there are seven high
coffees producing peasant association around coffee processing industry for collection of dry
coffee cherry for further processing. It is estimated that 2900 hectares of coffee land with of
0.75% tone clean coffee per hectares can be obtained and from the total land about 2,175 tones
clean coffee will be obtained from the surrounding kebeles.
Altitude:
With reference to weather condition the project area is categorized as woyinadega type of
climate. The altitude lies between 1600-2200M.A.S.L. This is suitable for production of high
quality coffee for national and international market.
Soil:
The soil composition of the area is generally loamy black brown to dark in color which is
suitable for quality coffee production.
Climate:
The climate is characterized by short dry and long rainy season. The annual temperature is range
from 20℃ and 25℃ .
5. Company Background
Ashenafi Abebe sundry coffee processing industry is capitalized with modern business
understanding which is owned by Mr. Ashenafi Abebe with initial investment capital of birr
5,178,327.00.

It is on the edge to capture extensive market value in the fast growing sundry coffee processing
industry and creasing coffee production in the woreda specially kebeles in the woreda, Balessa
Kilta. Borticha, Dari Wamanna, Dari Kidame, Buku Sayita, Jigeessa of Shakiso Woreda, Daansee
Kebele of Uraaga Woreda and Dari Bishan Fuggu which is not sufficiently absorbed by existing
sundry coffee processing industry.
The marketing and financial consultant developed market strategy that is well suited to build a
large market share in the woreda. It has the potential to gain a reputation for buying greater
quality of cherry coffee to be dried that its competitors. Head industry will coordinate
purchaser, chief mechanic, daily laborers, who are well experienced the area, should meet the
high standard that the industry has set for its quality product to be supplied to central market
exchange.
5.1The Product:
The industry is brought into being for the sole purpose of collecting dry coffee seed from
farmers and to supply organic good quality of sundry processed Yirgachefe quality coffee in
West Guji Zone Hambala Wamana Woreda in Damme Dabaye kebele in the area of 0.6 Heks of
lands. The area is far from the settlement of people that is adjacent to the site in the south and
south east part. Since it is basic necessity for the industry which has to be has treated to
minimize environmental pollution (Noise and Dust) through preparation of facultative at logon
distance.
5.2 Rational:
The main justification for identification of this project,
 The existence of sun dried coffee supply for hulling factory from the surrounding farms
 The availability of good transportation facilities from the processing site to the central
market
 The availability of communication facilities and nearby financial facilities
 The existence of a favorable investment promoting policy climate at the region.

6. Market Plan
6.1 Market Analysis:
Ashenafi Abebe sundry coffee processing industry’s marketing financial consultant carried out
substantial research prior to establish the industry. This concludes existence of surplus supply
of raw material (Dry coffee) which needs to be farther processed. On the area surrounding the
industry and to the growth of demand for high quality processed coffee in central market in
general.
The research results were quite compassionate according to the finding of information
developed from coffee producers of project area. i.e, Damme Dabaye and surrounding kebele
there is ever increasing coffee growers to supply dry coffee to the industries in Hambala
Wamana Woreda in general and in Damme Dabaye in particular where there are no sufficient
dry coffee processing industries. Due to this fact farmers and coffee dealers from those kebeles
are exposed to transport their dry coffee about 10 - 30 km to different surrounding coffee
processing industry found around Dimtu Town and that consume much energy, material, time
resources and negative impact on the coffee quality.
6.2 Market Strategy:
Ashenafi Abebe sundry coffee hulling industry will market itself as purchaser of high quality dry
coffee cherry by relative higher price than its competitors. As part of this strategy, the industry
advertises itself by using sharp notice and calling local meetings and telling the price they will
get for their quality supply.
The preferred mode of advertising is word of mouth by which its hopes to disseminate
information to generate a significant amount of customers through referrals.
6.3 Pricing Strategy
In relation to purchase of raw materials (Dry coffee cherry), it is planned to use psychological
pricing strategy where it will pay trivially, higher price for quality raw materials than other will.
Another means of pricing strategy is to enhance quality of outputs sundry processed coffee by

using technological advanced machineries and trained manpower in the conversion process.
Since the industry planned to produce high quality high land Guji test quality sundry processed
coffee it will sell its product at higher price as compared to those who produce other type les
quality sundry processed coffee.
Coffee market majorly determined at the central coffee market lead by ECX. Therefore, there is
no market problem for the project product.
6.4 Supply Aspect:
The major input required for sundried coffee cherry according to shortage of dry coffee hulling
factory in Damme Dabaye district supply of coffee from grows. So the importance of additional
dry coffee processing factory demand will be unquestionable.
7. Source of Revenue
The price of unwashed clean coffee is datelined from the action price in Addis Ababa which
varies from time to time depending on market price. The project proposed assumed to have
two sources of revenue. To achieve the goal the promoters will collect dry cherry of coffee
delivered clean coffee market for sale. Based on the current average action unwashed clean
coffee of Guji. The sale price for the clean coffee is assumed to birr 7,500.00/Feresula/ (17kg) in
average. The other source of revenue for the envisaged project would be a service charge
collected from customers that would obtain a coffee hulling service from the coffee factory. The
proposed service price for clean dry coffee is assumed to be Birr 300.00 for quintal of clean
processed coffee.
8. Organization and Man power

The project is a sole proprietary type of organization which is owned by Mr. Ahenafi Abebe. The
owner has an absolute power for financing, implementing, coordinating, monitoring and
controlling the smooth operation of the project. The total man power requirement of the
project is estimated to be 9 permanent workers and 30 - 50 are seasonal employees. The total
annual salary is estimated to be 357,000.00 birr. (The detail is shown on the following table)

Table 1: Manpower (Wedge/Salary) Requirement
No Position (Job title) No of workers Required Monthly salary Annual Salary

1 Manager 1 5,000.00 60,000.00
2 Casher 1 2500.00 30,000.00
3 Accountant 1 2500.00 30,000.00
4 Machine operator 2 4,000.00 48,000.00
5 Purchaser 2 2500.00 30,000.00
6 Guard 2 2,000.00 24,000.00
7 Daily Workers 30 (50 Birr for 90 days) 135,000.00
Total 357,000.00
9. Determination of Project Capital

Fixed Investment
9.1 Technical Study Construction
To achieve the planned investment objectives the promoter will be engaged in civil work
activities. Which would involves; the constriction of the factory house, Office, guard house,
coffee dry floor, Latrine, and fence work.
The owner of this project should be obtained the constriction permit and site plan from the
concerned governmental official of Hambela Wamena Woreda. Hence, the implementation
activity is expected to start soon after obtain the investment license.
Table 2: Building and Construction
No Description Quantity Estimated Cost (Birr)

1 Coffee hulling factory house 580M2 260,180.00
2 Office 20M2 152,500.00
3 Coffee Drying floor 400M2 80,600.00
4 Guard house 9M2 2,000.00
5 Power house 9M2 2,000.00
6 Toilet 12M2 5,000.00
7 Fence and others Lump Sum 100,000.00
Sub Total 602,280.00
Contingency 60,228.00
Grand total 662,508.00

9.2 Machinery and Equipment.
Machinery:
The capacity of the proposed project machine is assumed about 1000 kg -1500 kg clean coffee
per hour. However, taking into account other factors that could impede its efficient the
attainable capacity as start to up is assumed to be about 70% and existing it is envisaged
process about 250,000 kg clean coffee per annum.
Equipment:
The equipments proposed for the project includes weighting scales, moisture tester, and other
small tool and materials fur therefore; office and equipment are also proposed for the smooth
and efficient operation of the project. The detailed material requirements with their respective
cost estimates are annexed to the project proposal.
Table 3: Cost of Office Furniture and Equipments
No Item Quantity Unit cost Total Cost

1 Table
 Double pedestal 1 1,600.00 1600.00
 Single pedestal 2 1,400.00 2800.00
2 Chairs 8 250.00 2000.00
3 Shelves 2 1,500.00 3000.00
4 Pocket calculator 2 75.00 150.00
5 Briefcase 20 12.00 240.00
6 Other miscellaneous equipments 2000.00
Sub total 11,790.00
10% contingency 1,179.00

Table 4: Cost of Electronic Office Equipments
No Item Quantity Unit cost Total Cost

1 Desk top computer 1 25,000.00 25,000.00
2 Printer 1 32,000.00 32,000.00
3 Wireless telephone 1 5,000.00 5,000.00
Sub total 62,000.00
10% contingency 6,200.00
Table 5: Cost of Machinery
No Description Quantity Unit cost (Birr) Total cost (Birr)

1 Dry coffee hulling machine 1 650,000.00 650,000.00
2 Diesel generator & Alternative generator 1 150,000.00 150,000.00
3 Weighting scale 100kg 1 100,000.00 100,000.00
4 Weighting scale 50kg 1 50,000.00 50,000.00
5 Sack 500 46.00 23,000.00
Sub total 973,000.00
Contingency 5% 48,650.00
Grand Total 1,021,650.00
Table 6: Fuel oil and Lubricant cost
No Description Fuel consumption Total Fuel cost Total Annual

(Lit/Hr) consumption (Lit) Per Lit. Cost (Birr)
1 Generator 1lit/hr 2000 72.00 144,000.00
Total 144,000.00
Table 7: Working Capital Requirement

No Description Cost (Birr)

1 Dry cheery purchase (45,000kg @ 62 birr in average) 2,790,000.00
2 Repaired and Maintenance (2month) 22,000.00
3 Insurance (Initial year 1) 10,000.00
4 Loading and Unloading 50,000.00
5 Other (3 month) 40,000.00
Total Requirement 2,912,000.00
10. Financial Study

10.1 Source of Finance:
The project is expected to have two financial sources. The first would be definitely the
promoter him and the second one would be loan from nearby bank. According to the
information obtained the investor he has planned to cover about 30% (1,553,498.10) of the
investment cost from equity and to borrow the remaining 70% (3,624,828.90) balance of the
investment capital planned for envisaged project. It is assumed to get loan from local bank on
the basis of current interest rate and loan obligation. The loan would be used for purchase of
machinery and for the working capital requirement.
Planned Investment:
The total planned investment cost of coffee processing project is estimated to be around Birr
5,178,327.00. Out of this capital 2,266,327.00 Birr would be used for the fixed capital
investment and Birr 2,912,000.00 is for working capital requirement.
Table 8: Investment Cost Summary (In Birr)
No Descriptions Total Estimated Cost (Birr)

1 Manpower (Wedge/Salary) Requirement 357,000.00

2 Building and Construction 662,508.00
3 Cost of Office Furniture and Equipments 12,969.00
4 Cost of Electronic 68,200.00
5 Cost of Machinery and Vehicles 1,021,650.00
6 Fuel oil and Lubricant cost 144,000.00
7 Working Capital Requirement 2,912,000.00
Grand Total 5,178,327.00
Table 9: Depreciation Schedule of Fixed Assets
No Item Original Value Depreciation rate (%) Deprn. Cost/year

1 Building Contraction 662,508.00 5 33,125.40
2 Machinery 1,021,650.00 25 255,412.50
Total 288,537.90
11. Profit and Loss Statement

The price of dry coffee cherry at the project area as well as the price of clean coffee at the
auctions is so volatile that it will be difficult exercises try to forecast one’s profit or loss in this
century with any meaningful degree of accuracy. Price competition among hulling station
international market price with in turn rests up on world supply and demand for unwashed
clean coffee.
Therefore, we have found out to be meaningful testing the profitability of the project taking the
current average minimum auction price for unwashed clean coffee of Guji.
Accordingly, the profitability test carried out for this project shows positive result since the
operation of the project.

Table 10: Annual Operating Cost Estimate (In Thousand Birr)
No Descriptions Project Year

1 2 3 4 5
1 Dry cherry purchase 2,790,000 3,250,000 3,740,000 4,200,000 4,875,000
2 Salary & wage 357,000 374,000 392,000 392,000 392,000
3 Repair & maintenance 22,000 23,100 24,255 24,255 24,255
4 Loading & unloading 50,000 52,500 55,125 55,125 55,125
5 Full & Lubricants 144,000 324,000 324,000 324,000 324,000
6 Office Supplies 81,169 - - - -
7 Utility expense 23,000 24,050 25,205 25,205 25,205
8 Insurance 10,000 10,000 10,000 10,000 10,000
9 Miscellaneous Expenses 40,000 41,000 42,050 43,152.50 44,310.13
Total
3,517,169 4,098,650 4,612,635 5,073,738 5,749,895

Table 11: Revenue Forecast from Clean coffee & Hulling Service sale
Project Dry Cherry Coffee output (Kg) Dry Cherry hulling Service by Revenue From Total
Year Purchase Clean Broken & charge (In Kuntal) Clean Broken Hulling Revenue
(kg) coffee Sub graded Coffee Coffee Service
1 45,000 15,000 1,050.00 4,000kuntals @ 300 birr/Kuntal 4,500,000 115,500 1,200,000
5,815,500
2 50,000 16,667 1,166.69 6,000Kuntals @ 320 birr/ Kuntal 5,333,440 140,003 1,920,000
7,393,443
3 55,000 18,333 1,283.31 8,000kuntals @ 340 birr/ Kuntal 6,233,220 166,830 2,720,000
9,120,050
10,796,000
12,610,954
Hint:
 3kg of unprocessed coffee seed = 1kg of processed coffee seed

 From 100% processed coffee seed, broken & sub graded coffee is 7% of total processed seed
 1feresula = 17kg of coffee, and 100kg of coffee = 1kuntal of coffee = 5.9 feresulla
 Assumption of sale revenue from 1feresula of processed clean coffee is 5,440 birr( i.e 1kg of clean coffee= 320 birr)
 Purchase price of unprocessed coffee is birr 62,65,68,70 &75 for the 1 st, 2nd, 3rd, 4th and 5th respectively.
 Sale price of 1kg of broken and sub graded coffee seed is 110birr

Table 12: Profit or Loss Account
Description Project Year(E.C)

1 2 3 4 5
Net Sale 5,815,500 7,393,443 9,120,050 10,796,000 12,610,954
Cost of sale 2,790,000 3,250,000 3,740,000 4,200,000 4,875,000
Gross Profit 3,025,500 4,143,443 5,380,050 6,596,000 7,735,954
Selling and operating expense
370,169 474,650 480,635 481,738 482,895
General and administrative expense 357,000 374,000 392,000 392,000 392,000
Total operating expense

727,169 848,650 872,635 873,738 874,895
Operating Income 2,298,331 3,294,793 4,507,415 5,722,262 6,861,059
Other Operating expense
Depreciation 288,537.90 288,537.90 288,537.90 288,537.90 288,537.90
Interest (12.5%) 393,653.00 253,091.91 93,918.27 - -
Income before tax 1,616,140.10 2,753,163.19 4,124,958.83 5,433,724.10 6,572,521.10
Income tax expense(35% -18,000) 466,824 945,607.12 1,425,735.59 1,883,803.44 2,282,382.39
Net Profit 1,149,298 1,807,556.07 2,699,223.24 3,549,920.67 4,290,138.72


Performa of Cash flow Statement
Description Project Years
0 1 2 3 4 5
1. Cash Inflow
Owner Equity 1,553,498.10
Loan from Sinke Bank 3,624,828.90
Net profit 1,149,298 1,807,556.07 2,699,223.24 3,549,920.67 4,290,138.72
Depreciation 288,537.90 288,537.90 288,537.90 288,537.90 288,537.90
Subtotal Inflow 5,178,327.00 2,096,093.9
1,437,836 7 2,987,761.14 3,838,458.57 4,578,676.62
2. Cash outflow
Machinery Investment in Fixed assets 1,021,650.00 - - - - -
Building Construction 662,508.00 - - - - -
Increase in working capital 3,494,169.00 - - - - -
Sinke bank Loan repayment 1,061,511.03 1,202,072 1,361,245.76 - -
Personal withdrawal 10% of net
profit 114,929.80 180,755.61 269,922.32 354,992.07 429,013.87
Subtotal of Outflow 5,178,327.00 1,382,827.6
1,176,440.83 1 1,631,168.08 354,992.07 429,013.87
Net cash flow - 261,395.17 713,266.36 1,356,593.06 3,483,466.50 4,149,662.75
Cumulative cash flow 261,395.17 974,661.53 2,331,254.59 5,814,721.09 9,964,383.84
Retain earnings 1,034,368.20 1,626,800.46 2,429,300.92 3,194,928.60 3,861,124.85
Cumulative retained earnings 1,034,368.20 2,661,168.66 5,090,469.58 8,285,398.18 12,146,523.03
Performa of Balance Sheet
Projection year
Description 0 1 2 3 4 5 6 7
1.Asset
Current Assets
Cash - 2,053,343 4,448,739 7,012,994 9,752,019 12,674,550 15,789,764 19,107,295
Inventory 245,780 491,560 495,196 496,481 497,829 499,246 500,733 502,294
Total Current Assets 245,780 2,544,903 4,943,935 7,509,475 10,249,848 13,173,796 16,290,497 19,609,589
Fixed Assets
Machinery 17,370,580 15,412,320 13,699,840 11,987,360 10,274,880 8,562,400 6,849,920 5,137,440
Total Fixed Assets 17,370,580 15,412,320 13,699,840 11,987,360 10,274,880 8,562,400 6,849,920 5,137,440
Total Assets 17,616,360 17,957,223 18,643,775 19,496,835 20,524,728 21,736,196 23,140,417 24,747,029
2. Liability and Capital
Liability 8,562,400
DBE Loan 13,896,464 11,911,255 9,926,046 7,940,837 5,955,627 3,970,418 1,985,209 (0)
Total Liability 13,896,464 11,911,255 9,926,046 7,940,837 5,955,627 3,970,418 1,985,209 (0)
Capital
Equity contribution include
working capital 3,719,896 3,719,896 3,719,896 3,719,896 3,719,896 3,719,896 3,719,896 3,719,896
Retained Earning - 2,326,072 4,997,834 7,836,103 10,849,205 14,045,881 17,435,312 21,027,133
Total Capital 3,719,896 6,045,968 8,717,730 11,555,998 14,569,101 17,765,777 21,155,208 24,747,029
Total (Capital+Liability) 17,616,360 17,957,223 18,643,775 19,496,835 20,524,728 21,736,196 23,140,417 24,747,029
Table 13: Loan Repayment Schedule
Year Interest (12.5%) Principal Balance
1 393,653.00 1,061,511.03 2,563,317.87
2 253,091.91 1,202,072.12 1,361,245.76
3 93,918.27 1,361,245.76 0.00
Basic Points for the Preparation of the Project

Annex:
1. Annual working days of hulling services are 90 days (Effective 52 days)

2. Working hours per day is 8 hrs.
3. Wages and salary increase 5% each year
4. Project life year is taken as 6 years
5. Sales and Income tax is taken to be 12% and 35% respectively


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Business Proposal for

Business Proposal for

Ashenafi Abebe Special Sundry unwashed coffee Processing Industry

Promoter: Mr. Ashenafi Abebe

Nehase, 2015 E.c

22 Habtamu Consultancy Service for Economics, Business & Investment PLC

2 Habtamu Consultancy Service for Business and Investment

3 Habtamu Consultancy Service for Business and Investment

General Profile Of the project

4 Habtamu Consultancy Service for Business and Investment

5 Habtamu Consultancy Service for Business and Investment

 To caret job opportunity in the project area

3. Description of the project area

(Source: Woreda Agriculture office)

6 Habtamu Consultancy Service for Business and Investment

Socio Economic Activities of the Area

7 Habtamu Consultancy Service for Business and Investment

4. Suitability of the Project Area

8 Habtamu Consultancy Service for Business and Investment

The main justification for identification of this project,

9 Habtamu Consultancy Service for Business and Investment

6.2 Market Strategy:

6.3 Pricing Strategy

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6.4 Supply Aspect:

8. Organization and Man power

11 Habtamu Consultancy Service for Business and Investment

Table 1: Manpower (Wedge/Salary) Requirement

No Position (Job title) No of workers Required Monthly salary Annual Salary

9. Determination of Project Capital

9.1 Technical Study Construction

Table 2: Building and Construction

No Description Quantity Estimated Cost (Birr)

12 Habtamu Consultancy Service for Business and Investment

9.2 Machinery and Equipment.

Table 3: Cost of Office Furniture and Equipments

No Item Quantity Unit cost Total Cost

13 Habtamu Consultancy Service for Business and Investment

Table 4: Cost of Electronic Office Equipments

No Item Quantity Unit cost Total Cost

Table 5: Cost of Machinery

No Description Quantity Unit cost (Birr) Total cost (Birr)

Table 6: Fuel oil and Lubricant cost

No Description Fuel consumption Total Fuel cost Total Annual

Table 7: Working Capital Requirement

14 Habtamu Consultancy Service for Business and Investment

No Description Cost (Birr)

10. Financial Study

Table 8: Investment Cost Summary (In Birr)

No Descriptions Total Estimated Cost (Birr)

1 Manpower (Wedge/Salary) Requirement 357,000.00

Table 9: Depreciation Schedule of Fixed Assets

No Item Original Value Depreciation rate (%) Deprn. Cost/year

11. Profit and Loss Statement

16 Habtamu Consultancy Service for Business and Investment

Table 10: Annual Operating Cost Estimate (In Thousand Birr)

No Descriptions Project Year

17 Habtamu Consultancy Service for Business and Investment

 3kg of unprocessed coffee seed = 1kg of processed coffee seed

18 Habtamu Consultancy Service for Business and Investment