BUTTERFIELD PLUMBERS

PRESENTED BY: SHARON CHEPKOECH

INDEX NO: 5711010030
CENTER: KIMASIAN TECHNICAL AND VOCATIONAL
COLLEGE
COURSE. : DIPLOMA IN GENERAL AGRICULTURE
PHONE NO: 0717340583
SUPERVISOR'S NAME: SAMWEL KOSKEY

PRESENTED TO: THE KENYA NATIONAL EXAMINATION

COUNCIL IN PARTIAL FULFILLMENT FOR THE
REQUIREMENT OF THE AWARD OF DIPLOMA IN GENERAL
AGRICULTURE

EXAM SERIES: JULY 2024

 DECLARATION

I hereby declare that the business plan is my original work and that it has not been presented
for the award of a diploma to any institution.

Student Name:………………………………………………………….

Sign:…………………………………………………………………….

Supervisor Name:………………………………………………………

Signature:…………………………

Date:……………………………...
 ACKNOWLEDGEMENT
First and foremost, I thank the almighty God for his love, care and protection in
my entire life. I am grateful to my academic lectures and supervisor for
encouragement and tireless efforts in ensuring that my work was successful. His
advice and guidance for making integral part in completion of this work.
 DEDICATION
I would like to dedicate this business report to all people who assisted me to
accomplish my studies and others in a special way my parents for their support
and understanding.
 TABLE OF CONTENTS

Declaration :.......................................................( I)

Acknowledgement :...........................................( ii)

Dedication :.......................................................( iii)

TABLE OF CONTENT

(I)Executive summary:

(ii)Business description:

(iii)Marketing plan:

(iv)Organizational plan:

(v) Production and operational plan:

(vi)Financial plan:

CHAPTER ONE

1.0 Business description

1.1 Business name

1.2 Business location and address

1.2.1 Physical Address

1.2.2 Postal Address

1.3 Form of ownership

1.4 Product and service offered

1.5 Justification of Beginning of the Business

1.6 Industry Type

1.7 Goals of Business

1.7.1 Short Term Goals

1.7.1 Long-term goals

1.8 Entry and growth strategy

1.8.1 Entry to the Business

1.8.1 Growth
 CHAPTER TWO

2.0 Marketing plan

2.1 Potential Customers

2:2 Marketing share

2.3 Competition

2.4 Method of Advertising and promotion

2.4.1 Advertising

2.4.1 Promotion

2.5 Pricing strategy

2.6 Sales Tactics

2.7 Distribution strategy

CHAPTER THREE

3.0 Organization and management plan

3.1 Management

3.1.1 Manager/Owner

3.1.2 Security

3.2 Recruitment and promotions

3.2.1 Recruitment

3.2.2 Training

3.3 Remunerations and incentives of personnel

3.3.1 Remunerations

3.3.2 Incentives:

3.4 License, permit and bylaws:

3.5 External Resources

3.6 Legal Structure

3.6.1 Employment Agreement

3.6.2 Stock Agreement

 CHAPTER FOUR

4.0 Operation and production plan

4.1 Production strategy

4.1.1Item, cost, capacity, supplies

4.2 Production Strategy

4.2 Relevant Regulations

CHAPTER FIVE

5.0 Financial plan

5.1 Preoperational cost

5.2 Working Capital

5.3 Proforma Balance Sheet

5.4 Project cash flow

5.4.1 2021 cash flow

5.4.2 2022 cash flow

5.4.3 2023 cash flow

5.5 Break-even level

5.5.1 Break-even point for the 1st year

5.5.2Break-even for the 2nd year

5.5.3Break-even point for 3rd year

 EXECUTIVE SUMMARY
BUSINESS DESCRIPTION

BUTTERFIELD PLUMBERS will be the name of the business. The business is intended to be
started by 2027.

I will be based on the outskirts of Londiani town. Kericho County. I have done market, research
and sensibility studies and will be able to secure 2 acres of land approximately 500m before
Londiani market along Muhoroni- Kisumu highway to start Plumbing business.

MARKETTING PLAN

The business will be involved in selling farm chemicals, animal feeds and other equipment’s and
offering services hence the business ensures that the products are of good quality and available
anytime.

ORGANISATIONAL PLAN

In the few hours to come, hopefully within the first 3 years of officially running
BUTTERFIELD FARMERS.

We will start our own company which will be exporting our products to other parts of the
country and neighboring counties.

OPERATIONAL PLAN

BUTTERFIELD PLUMBERS will be a sole proprietorship that is owned and managed by

CHEPKOECH SHARON and immediate family members.

The business will ensure that the hired people have qualified to run business, hardworking
dedicated customers and ready to work to help us built a prosperous business that will benefit
everyone.

The business will also put process and strategies in place that will help us employ the best
practices when it comes to plumbing business.
 FINANCIAL PLAN

The business will require the starting capital of ksh 700,000 to cover all the necessary
arrangements of raw materials, building, hiring employees, marketing and working capital
source of funds.

Below is the contribution structure for startup capital to be used in the business.

SOURCE KSH PERCENTAGE

Loans from bank 300000 50%

Personal savings 150000 20%

Family contribution 250000 30%

Total capital 700000 100%

 CHAPTER ONE
1.0 BUSINESS DESCRIPTION

The owner of the business will be a sole proprietorship because the business is small it does not
require partners since it will take long time in decision making.

The owner will be able to manage business well because she is well educated and has the ability
of being on entrepreneur. The business will mainly deal with plumbing equipment’s and
materials

1.1 BUSINESS NAME

The Name of the business will be Butterfield plumbers. The Name butterfield symbolizes the
Good attraction of the business.

1.2 BUSINESS LOCATION AND ADDRESS

The proposed business will be located in londiani along Kisumu Road -Near Nakuru highway.
This is strategic place given the ready available market that most of the residents are farmers and
working class. The area has good security since its located near police station hence it will
enhance smooth running of the business.

BUTTERFIELD PLUMBERS

P.O BOX 79,

KERICHO TO
MOBILE NUMBER, 0717340583 BUTTERFIELD NAKURU

TO LONDIANI PLUMBERS SHOP

TOWN

TO KISUMU
KISUMU TO LONDIANI JUNCTION

TO
KERICHO
1.3 BUSINESS OWNERSHIP

The business will be a sole proprietorship where the sole proprietorship will be in charge of all
Management. The owner of the business preferred to form of ownership because of the
following reasons, Profit are not shared, easy decision making and required little initial coat.
The business intended to come into operation as from May 2023 when everything have been
established.

1.4 JUSTIFICATION OF THE BUSINESS

The business venture is given available that there is unsatisfied demands and lack of
employment in neighbouring plumbing shop. I decided to venture in so that I give out the
expected demand of good quality products. The business will offer credit facilities to the
customer with high purchasing frequency in order for the customer good to be compared from
those of the competitors.

1.5 PRODUCTION AND SERVICE

The product that BUTTERFIELD PLUMBERS OFFERS Are:

 Stainless steel pipes

 Galvanized iron pipes

 Concrete pipes

 Asbestos cement pipes

 Copper pipes

1.6 THE INDUSTRY

The business falls under trade industry where all types of goods needed are produced and of the
higher quality and quantity. The number of firms in the existence in this industry around
whereby advertisement is applied in Internet. The labour is extensive.

1.7 BUSINESS OBJECTIVES

The main objective of the business is to run a profitable operation which means increase
revenue while limiting expensive .The objective is to expand the business to large
medium ,opening more branches countrywide ,sell products of high quality and quantity carry
out research in improving delivery service.

1.8 E NTRY AND GROWTH STRATEGY

Entry strategies. Production promotion the business employs strategies through advertisement,
such as social media, posters and business cards and bill boards. This will be placed in
catchment points and entry pointing the town inclusive of contacts, emails and all physical
addresses of business.

Provision of free service and gifts when a customer buys large goods of the business.

Properly display, the goods will be displayed in manner the can attract the eyes of the customers

Growth strategies, opening more branches the business will produce more profit which enables
the owner to open new branches within the area which will be selling the same products and
services as the original business.

Paying loans due to increased profits of the business will be able to pay all the debts such as loan
from the bank.

Expanding the business; the owner of the business will be able to expand the business

Of the increased capital and profits from the business.

CHAPTER TWO
2.0: MARKETING PLAN

This is how the proprietor intends to sell his products and services to his potential customers.

The business will be involved in selling building pipes and water equipment’s and offering
services hence the business ensures that the products are of good quality and available at any
time and also priced at which they obtain them.

2.1: CUSTOMERS

The owner of the business will be targeting on 3 types of customers;

a) Individual customers
This are customers who are able to buy goods directly from the business
b) Institutional customers
This includes customers such as colleges, schools, market. The owner will be able to do
domestic application of chemicals or fertilizers to this institution and supply products.
This institution will promote the business so much more hence improve its products.
c) Potential customers
These are customers who are regular and from the town they are also given discount for
the product they have bought and are even offered transport of the products to their
respective place of use.

2.2: COMPETITION

These are business dealing with the same products and services as the proposed business. These
are small business around the business such as TERRY, BROWNSTAR and TOPSTAR which
offer the same products and services as the proposed business.

The business however offers products of low quality and low prices which will attract customers
to buy goods from them and it’s in turn honor the profit. Those other business offers the same
product as the proposed business, but they differ in terms of quality, prices and services. The
other business is located at 2km from the proposed business.

Business name strength weakness opportunity Threats

TERRY Good time Inexperienced Time Insecurity

hand
Management Youth funds competition
Low
Average performance Financing

Quality products Inefficient funds infrastructure

Technical
 Skilled labor

BROWNSTAR Capital Poor time Financing Economic

management crisis
Potential Housing
customers Low reputation insecurity
maintenance
famous Unskilled labor

TOPSTAR High experience Low quality Financing Insecurity

products
Skilled labor maintenance inflation
Low levels of
Famous technology
Fair prices

2.3: MARKET SHARE

The proprietor will observe the area and see number of customers into the business to purchase
goods

He will also study the market through interviewing the customers he will get to know the share
in the business.

The business expected to contribute about 30% of the first establishment and rise up to more
than 50% after a period of 2 years

Total potential customers in town are about 950 and for;

TERRY PLUMBER = 350/950 *100 = 33.68%

BROWNSTAR = 250/950 *100 = 26.32%

TOPSTAR = 286/950 * 100 = 30.59%

OTHERS = 94/950 * 100 = 9.89%
40.00%

35.00% 33.68%
30.59%
30.00%
26.32%
25.00%
PERCENTAGES

20.00%
PERCENTAGES
15.00% Series2
Series3
9.89%
10.00% Series4

5.00%

0.00%
TERRY BROWNSTAR TOPSTAR OTHERS
PRODUCT NAMES

2.4: COMPETITORS

TERRY PLUMBERS

BROWNSTAR

TOPSTAR the strength is that they have already started their business hence have customers and
have enough equipment’s and machines but they also have a weakness where the treat customers
rudely and don’t have enough goods and services.

2.5: METHODS OF PROMOTING AND ADVERTISING

Posters; posters will be used after acquiring permission from various authorities to stick the
posters of various building.

Sign post; they will be placed on strategic places such as central bus station where more people
will see to market consumers

Fliers; the business will use fliers to make the people aware of the business.

2.6: PRICING STRATEGY

In setting prices for the products the following methods will be used in calculation.

2.6.1: COST ORIENTED

All expenses incurred in acquiring and distributing goods

2.6.2: COMPETITORS

The competitors will be determined on price setting example when high for competitors
BUTTERFIELD FARMERS will be low thus increasing market share

2.6.3: DEMAND OF CUSTOMERS

Prices will be determined according to market demand.

2.7: SALE TACTICS

The owner will apply the following methods in order to market his products and hence customer
satisfaction.

Direct selling; this is when the business owner will sell the commodity face to face.

Credit facilities and discounts; the owner will sell the commodity on credit to have regular
customers.

Road shows and agricultural shows; the business owner will offer road shows to make the
business to be known and from this the owner will be selling few products when the show is on.

2.8: DISTRIBUTION STRATEGY

Distribution strategies are a channel of process through which products reach the customers.
Road transport will mostly be used by the business. Means of distribution are;

 Motorbike

 Tuktuk

 Hand driven carts

 Bicycles
 CHAPTER THREE
3.1: ORGANISATION STRATEGY

Having a solid plan for how the business will run the key components of its smooth and
successful operation. The owner of the business needs to put some considerations and
regulations in place to ensure them to work well with each other and on their own.

The owner of the business will have employees who will be working in different areas to ensure
the effectiveness of the work and ensure that all the customers adhere to. The owner of business
will also ensure that all the employed staffs are doing their work respectively. Every worker will
get their salaries at the end of every month according to the position he/she owns. The owner of
BUTTERFIELD PLUMBERS shop will be having the following duties and responsibilities

a) Manage the business

b) Supervise other business
c) Ensure the flow of incoming product
Organization chart.

MANAGER

ASSISTANT MANAGER

SALES LADY/ MAN

RECEPTIONIST SECURITY MAN

3.2: PERSONAL NUMBER AND DUTIES

NO PERSONELL DUTIES

1 Manager Supervise and motivate the

employees, manage every activity of
the business

2 Assistant Assist the manager when she’s not

manager around the premises to ensure
business run smoothly

3 Receptionist Welcome and direct the customers

4 security Ensure there’s enough security to the

premises

5 Sales lady/man Assist the customer in looking for the

product and any service needed

6 Cleaners Maintain high standard of hygiene

and cleanliness in the firm.

3.3: RECRUITMENT, TRAINING AND PROMOTION

NO PERSONELL QUALIFICATION

1 Manager Age 24yrs old

Graduate from an institution
At least distinction and credit in
entrepreneurship
Has experience in running several
business

2 Assistant Aged 23yrs

manager Has valid national identity card

3 Receptionist Diploma in general agriculture

Valid national ID
Punctual and goal oriented

4 security National ID
Aged 26-30yrs old
Be certified security personnel

5 Sales lady/man Have good experience in the business

6 Cleaners Have valid national ID and punctual

Training
The proposed business will train the employees on how to relate customers and how to
convince them to buy the product.
The business will be also welcoming other personnel with more skills so as to motivate
and equip employees with knowledge and more skills.
Promotions
The proposed business will be promoting their employees who will work hard in their
work to higher level. Also the business will be presenting awards for the hardworking.
3.4: RENUMERATION AND INCENTIVES
BUTTERFIELD PLUMBERS shop will be paying its workers according to their
positions every month.
NO PERSONELL SALARIES

1 Manager KSH 15,000

2 Assistant KSH 10,000

manager

3 Receptionist KSH 8,000

4 security KSH 5,000

5 Sales lady/man KSH 5,000

6 Cleaners KSH 3,000 INCENTIVES

TOTAL KSH 46,000 The business will offer
some allowance and
incentives to the employees to motivate them so that they can carry their duties well.

3.5: LICENCE AND PERMITS

BUTTERFIELD PLUMBERS shop will obtain its license from the municipal council and the
county council for it to run smoothly. The proposed business will also get permit for selling
Animals feeds, chemicals and other product from the city council.

3.6: SUPPORT SERVICES

The business will get loan from the nearby equity bank, deposits its money and have cheques. It
will also ensure that the business is more secured from risks such as thefts and its employees.

There’s also good transport system in the area which will enable good transportation of goods
and customers. The electricity is also available as well as water are in supply.

The postal services

This will enable fast communication, people can order to the business at cost of ksh 500 per
month and the address will be as follows;

BUTTERFIELD PLUMBERS,

P.O BOX 79,

KERICHO.

Electrical services

It’s the raw material in a business. Kenya power lightning company will be supplying the
electricity to the business.
 KENYA POWER LIGHTNING COMPANY

P.O BOX 7907,

NAIROBI.

Water services

In order to maintain clean lines and perform other duties, water is needed. It will be supplied by
the Nairobi clean water company which will cost kshs 5000.

KERICHO WATER

P.O BOX 79079,

NAIROBI

Insurance services

Due to risks involved in the business the goods; employees will be covered on a third party.
Insurance policy this will be the business insurance address;

KENYA INSURANCE

P.O BOX 790,

NAIROBI.

CHAPTER FOUR
4.0 OPERATIONAL PLAN

4.1 PRODUCTS /SERVICE DESIGN AND DEVELOPMENT

The business will not venture on production it will be a source oriented one sustaining the
customers in the business .Therefore the business will keep good relation between it and its
customers.

4.2 PRODUCTION OF OPERATIONAL FACILITIES

The type of products to be purchased include.

Animal feeds

Seeds

Fertilizers

Veterinary

Hays

Machinery

Chaff cutters

4.3 PRODUCTION STRATEGY

Monthly material requirement

Position Amount KSH

Manager 15000

Assistant Manager 10000

Receptionist 8000

Security 5000

Sales man/lady 5000

cleaners 3000

Total 46,OO0

Monthly production cost

 Electricity 2000

Water 3000

Advertisement 1000

Salaries 46,000

Transport 5000

Rent 20,000

Insurance cover 10,000

TOTAL 87,000

4.5 OPERATIONAL PROCESS

Workers are expected at work 7; 30 am and closing be assistant manager will be distributing
jobs to workers they will be working to their posts.

EMPLOYEES WORK ACT

This include the right to

. Be paid

. Be respected

. Get sick allowance

. Freedom to do personal work

CHAPTER FIVE
5.0: FINANCIAL PLAN

5.1: PRE-OPERATIONAL COST

ITEM AMOUNT

Fixed assets Ksh 28,000

Rent payment Ksh 20,000

Trade license and permits Ksh 5,000

water Ksh 15,000

Insurance policy Ksh 10,000

Stock Ksh 10,000

electricity Ksh 2,000

TOTAL Ksh 161,000

5.2: ESTIMATION OF WORKING CAPITAL

BEGINNING OF YEAR MIDDLE YEAR END YEAR

Stock Ksh 7,000 Ksh 50,000 Ksh 70,000

Debtors Ksh 5,000 Ksh 7,000 Ksh 9,000

Cash in hand Ksh 9,000 Ksh 6,000 Ksh 10,000

Cash at bank Ksh 12,000 Ksh 18,000 Ksh 20,000

Work in progress Ksh 16,000 Ksh 110,000 Ksh 120,000

Loans Ksh 20,000 Ksh 14,000 Ksh 4,000

TOTAL Ksh 131,000 Ksh 196,000 Ksh 233,000

Assumptions

Rent will remain constant throughout the year.

Water and electricity will vary according to work.

5.3: PROFORMA BALANCE SHEET

FIXED ASSETS BEGINNING OF YEAR 1 END OF YEAR 1

Land and buildings Ksh 20,000 Ksh 60,000

Furniture and fittings Ksh 35,000 Ksh 52,000

Cost of products Ksh 95,000 Ksh 40,000

TOTAL FIXED ASSETS Ksh 160,000 Ksh 152,000

CURRENT ASSETS

Debtors Ksh 5,000 Ksh 7,000

Cash in hand Ksh 9,000 Ksh 14,000

Cash at bank Ksh 12,000 Ksh 14,000

Stock Ksh 70,000 Ksh 50,000

TOTAL CURRENT Ksh 96,000 Ksh 58,000

ASSTS

CURRENT LIABILITIES

Creditors Ksh 11,000 Ksh 3,800

Bank overdraft Ksh 19,400 Ksh 24,500

TOTAL Ksh 30,400 Ksh 28,300

Long term liabilities - -

Loan from bank Ksh 120,000 Ksh 310,000

TOTAL LIABILITIES Ksh 150,400 Ksh 338,300

5.4: PROJECTED CASHFLOW STATEMENT FOR YEAR 1

ITEM JAN FEB MA APR MA JUN JUL AUG SEP OCT NOV DEC
R Y T

Cash 5500 2200 3500 2800 1800 2400 2550 7550 4200 5500 6400 7800
sales 0 0
Cash - - - - - - - - - - - -
flow

Collectio 7000 2500 1500 6400 3550 2800 1200 1350 2700 3200 4800 3800
n from
debtors

Discount 1600 1400 4800 5600 3800 2450 3560 6700 3900 9000 1000 1350
records 0

Cash 2000 2300 1000 1150 1400 3110 3000 2700 3800 4950 9000 1200
purchase 0 0 0 0 0 0 0 0 0 0

Payment 8000 5000 3200 500 700 1250 1380 4000 1300 1000 2000 700
to
creditors

Rent 4500 4500 4500 4500 4500 4500 4500 4500 4500 4500 4500 4500

Salaries 1700 1850 3100 1630 5750 1400 2000 2100 2160 2700 4720 4920
& wages 0 0 0 0 0 0 0 0 0 0 0

Electricit 3000 2700 1300 4100 1750 3200 2800 2300 3200 1900 4000 2700
y&
water

Cash of 1950 2000 3100 5500 1000 2700 2250 3200 4950 3500 3000 3950
the 0 0 0 0 0 0 0 0 0 0 0 0
month

5.5: PROFORMA INCOME STATEMENT

SALES AMOUNT

Cash of sales 200000

Opening stock 180000

Purchases 4400

Closing stock 60000

Gross profit 38500

 EXPENSES

Salaries & wages 19000

Rent 44000

Water 3550

Electricity 3550

Advertising 2000

Transport 32400

TOTAL 100,950

5.6 BREAK EVEN POINT ANALYSIS

VARIABLE COST AMOUNT

Electricity 3550

Water 3550

Purchases 4400

Stock 60000

TOTAL 111,100

CONTRIBUTION MARGIN

Sales = total variable cost

200000 – 111100 = 88900

COST MARGIN PERCENTAGE

Contribution margin/ 200000 * 100% = 88900 /200000 * 100

= 44.45%

TOTAL FIXED COST

 Rent 20000

Salaries 46000

insurance 10000

TOTAL 111,100

Break-even level

76000/20000 * 100 = ksh 38

5.7: DESIRED FINANCING

FINANCING REQUIREMENTS AMOUNT

Pre- operational cost 280000

Working capital 178000

Fixed assets 160000

Products 200000

TOTAL DESIRED FINANCING 818000

5.8: PROPOSED CAPITALIZATION

ITEM AMOUNT

Personal savings 300000

Borrowing from friends and family 150000

Loans from equity bank 250000

TOTAL KSH 700,000

APPENDIX

BUTTERFIELD

PLUMBERS SHOP
TO LONDIANI TO
TOWN NAKURU

TO KISUMU
KISUMU TO LONDIANI JUNCTION

TO
KERICHO