BUSINESS PLAN FOR

Income summaryPage
1. INTRODUCTION……………………………………………………………………….………. 1
1.1Nature of the business
1.2 Financial statement
1.3 Statement of confidentiality
2. Executive summary..................................................... 2
3. Industry analysis ………………………………………………….. ….. 3
3.1Analysis of competitors
3.2Market segmentation
3.4Industry forecast
4. Description of the ventur………………………………………………..4
4.1 Size of the poultry farm
4.2 Site and design of the poultry farm
4.3 Office Equipments
5. Production Plan …………………………………………………………...5
5.1Equipment and Machinery
5.2 Food (Balanced Diet)
6. Marketing Plan………………………………………………….……… .….6
6.1 Distribution
6.2 Promotion
6.3 Product Forecast
6.4 Financial Plan
7 Organizational Plan …………………………………………….….7
8 Risk assessment …………………………………………………..…..….... 8
6.1 Failure to produce the products
6.2 New Technologies
8 Conclusion………………………………………………………………… 9
9 Appendix ………………………………………………………………….. 10

1. INTRODUCTION

This business is required to establish a general partnership. The name of the business is babugaya poultry farm
(enterprise).

The name and address of the partners

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 No Name Address
1. Kuri Tefera Bishoftu
2. Tamrat Wodajo Bishoftu
3. Serkalem Teshome Bishoftu
4. Feleke Gebrie Bishoftu
5. Million Gezahegn Bishoftu
6. Ergoye Assen Bishoftu
7. Abebaw Gebeyehu Bishoftu
8. Bishoftu

Address of the business

babugaya poultry enterprise
Tel: 01000100100
P.o.Box 01111, Debre Zeit, Ethiopia

Nature of the business

Now a day the price of egg and live chicken is increasing due to the shortage of poultry farm business
activities that can match the increasing local customers’ demand of the sector. The partner’s
expectation is to fill the gap of the demand and supplies of the poultry products.

Financial statement

Every business needs finance to be invested and implemented in particular to achieve the goals. So
our financial capacity depends partially on our capital contributed by the partners of the enterprise
which accounts for about 60% of the total capital.
The partners or poultry farm business owners handle planned to get the remaining capital 40% from
debt financing institution (banks).
The total beginning capital needed to run the business is about 378,000.00 birr.

Statement of confidentiality

The partners agree to implement the project according to the plan and agreement written here under.
No additional statement is made without the agreement of all partners and it is not allowed for others
in whole or individually without permission of all partners.

2. Executive summary

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The poultry farm owned by the partners is conceived being a mindful of the increasing demand and
shortage of supply so as to contribute our part in filling this wide gap; furthermore, it plays a great
role in development of the town in particular in terms of investment and creation of job opportunities.
It also serves the community by supplying its products with lesser prices compared to current market
price. Because there is a shortage of poultry products (egg and chickens) supply throughout the town
and its surroundings, the current existing market price is too expensive.
The poultry farm business can be effective in loss capital compared to other industries which require
very huge and expensive machineries so that establishing the poultry farm business is profitable.

1.1 Mission

Our goal is to be the poultry farm of choice for the local community and bishoftu city business
workers, in this town morels the most tourism area in the other city by this opportunity more hotel
and spa existed this area so a lot of demands by providing a higher quality experience than and cheap
cost of other competitor. As a result, we intend to create poultry farm that quickly achieve profitability
and sustain an attractive rate of return (20% or more annually) for our investors.

We also want to make our contribution to the welfare of the local community by supporting
charitable and civic activities. We will support the farmers who grow our poultry by using Fair Trade,
Sustainable Production and Organic products whenever possible.

Objectives

 Make poultry farm the number one destination for agg in Pleasantville to the customer
 Sales of 15,000+ the first fiscal year, 250,000+ the second fiscal year and 500,000 the third
fiscal year
 Achieve a 15% net profit margin within the first year and 30% by the third fiscal year
 Achieve a total net profit of 30000 in First fiscal Year and 100000+ by third fiscal year
 Be an active and vocal member of the community, and provide continual re-investment
through participation in community activities such as the financial contributions to local
charities and youth organizations
 Create a solid concept in the industry and track performance in order to begin expanding to
other markets within six months

Keys to Success
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  The keys to our success will be on our farm three mean and big success
1. The first one our company poultry our society use by small amount cost use egg and
is sustainable and uniformly run to the market
2. The second our success by our society and growth day to day company profit
3. And A dynamic website with online sales capability

Company summery
 Variety: No other poultry farm in the area will provide started by this idea
 Location: poultry farm will be located in the prime section of Bishofftu town the area located
Babugaya this area the most conformable place for our farm and entertainment locations are
designed for high volume with revenues and profits to match.
 Expansion: Assuming this store is successful, it will be the first of other same farm gathering
and observing firstly and we gain more experience so highly demands by this market

3. Industry analysis
The historical achievement obtained from individuals involved in this investment (business) showed
that the poultry farm business is highly profitable.
From analysis of farms currently existing in the town, their strength was and mass production mass
sales leading to high profitability but their weakness was they neglect the local customers or
community paying special attention to whole buyers.
Therefore, in the mean time this poultry farm starts its business by selling eggs and in few years later
it can also sell live chickens to the local customers.

Analysis of competitors
Even though there are two known poultry farms (Genesis and Alema farms) in the town, they could
not satisfy the demand of the community especially local customers and their price is also too
expensive.
People usually buy eggs and chickens from the market which came from the surrounding farmers.
So that our aims to attract the community with lesser market penetrating price and more eservice.

Market segmentation
Since the country follows free market policy, the partner’s assumption is to deduct the price from the
current price of the market and providing its products (eggs and chickens) in its full capacity so as to
attract customers.

is comprised of four target groups.

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 1. hotel
2. Tourists ( the city is tourist center any national people is came to her)
3. Local business people
4. Students

These groups are all potentially strong customer segments. The benefit of this mix of customers is
that it helps maintain consistent business throughout the year. For example, while tourism is strong all
year long in this town , it peaks during the summer months. Conversely, the student population is not
as strong during the summer as it is from September through June of each year.

Market Analysis
Potential Growt Year 1 Year 2 Year 3 Year 4 Year 5 CAG
Customers h R

Hotel 2% 75,000 76,500 78,030 79,590 81,181 2.00%

Tourists 5% 100,000 105,000 110,250 115,763 121,551 5.00%
Students 1% 40,000 40,400 40,804 41,212 41,624 1.00%
Local 1% 20,000 20,200 20,402 20,606 20,812 1.00%
businesses

Total 9.00% 235,000 242,100 249,486 257,171 265,168 9.00%

Industry forecast
The poultry farm try its best so as to achieve its goals by utilizing the man power available the
financial capacity.
It also contacts other farms to share their experiences.

4. Description of the venture

Babugaya poultry farm is a partnership based business which will be established in Bishoftu.
Ethiopia that serves primarily the local customers or community and/or the community of Bishoftu
and its surrounding by supplying its products i.e. eggs and chickens.
This farm is designed to give efficient and effective service to the public and to enhance the customer
satisfaction.

Size of the poultry farm

The size of this poultry farm is not large.
It is just like a micro enterprise, though it will grow to large partnership enterprise in the future.
Currently the poultry farm Plans to start by having 1000 chickens which start laying eggs after three
months.

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Site and design of the poultry farm

The farm is located in Bishoftu town, kebele 15 commonly called babugaya area near high way to
Addis Abeba and Adama.
The farm will start its operation in compound rented from private ownership.
The compound has a size 1000m2, having all the necessary facilities such as chickens house, offices,
waste dump place, toilet, shop and guard home.

The size of the house for chickens is 18m x 50m which is sufficient for 1000 chickens.
The compound had rented on contractual basis with 30, 000 birr per annual for five consecutive years.

Office Equipments
The following office equipments are required for the farm to run its business and achieve its goals

Long term assets: 9168.00 birr

No Item Quantity Unit Price Total Price

1 Table With one 3 1,000.00 3,000.00

drawer

2 Chairs w/fabrics 8 550.00 4,400.00

3 Book Shelf 1 768.00 768.00

4 File cabinet 1 1,000.00 1,000.00

w/three drawer.

Total       9168.00

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Short term Assets

Tables, Chairs, Furnishings 12,000

Car rent 1,000
Lighting Fixtures 2,000

5. Production Plan
The poultry farm production plan is based on the size of the farm, as it is stated in the size of the farm
section, the farms assumption is to start by having 1000 chickens.
All chickens are hens (layers) and from these 1000 of them are expected to lay eggs per day after
three months from the beginning of the operation.

Equipment and Machinery

As a new business this poultry plans to buy locally made equipment which has less price than the
imported ones.

Fixed asset

Items Quantity Unit Price Total Price

Feeder 20 60.00 1,200.00
Drinker 30 70.00 2,100.00
Water tank 1 1,000.00 1,000.00

Total 4300

Supplies and Raw Materials for Poultry Farm

Chickens
As we have explained in our production plan, we will have 1000 chickens.
The chickens will be purchased from poultry farms that sell young chickens.
The age of chickens planned to be purchased is 1 month each costs 20.00 birr.
The farm planned to purchase this young age chicken because of inability to purchase incubator as it
is too expensive.
The total budget required for purchasing of chicks will be 1,000x45 i.e 45,000 birr.

Food (Balanced Diet)

Balanced diet feed will be purchased from farms that are preparing the diet with mixer.
About 39,200 birr will be allocated for the feed consumption per year.

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6. Marketing Plan
The price of the products is based on the current price of the market.
However, the poultry farm plans to deduct from the current market price by 10-15% from eggs and
10-50% from live chickens.
The following table shows the comparison of market (current market) price and our pricing plan.

Item Current Market price Our price

Egg 3.50.00 birr 2.50.00 birr
Live chickens 150.00 birr 100.00 birr

Distribution

The poultry farm will distribute its products (eggs) in to three selected sites in surrounding Bishoftu.
It also plans to distribute daily to Gelan,Dukem and Modjo towns.

Promotion
The poultry farm will expand its market plan to Addis Ababa and Nazreth when the action plan for other sites
is effective and size of the farm expands.

Product Forecast
This poultry farm will get stable revenue for three years. The following table shows product forecast
of the farm.

Item 1st year 2nd year 3rd year 4th year 5th year
Egg 405,000 427,500 427,500 303,750.00 427,500.00
Chickens - - - 80,000.00 0.00
Total 405,000 427,500 427,500 383750.00 427500.00

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Sales Forecasting
Sales Forecast
Year 1 Year2 Year3 Year 4 Year 5
Egg 360000
Chickens
Total

Total Operating expenses,Cost , total revenue and profit of poultry farm for the next five years.
Expenses 1st year 2nd year 3rd year 4th year 5th year
House rent for the farm 30,000 30,000 30,000 30,000 30,000
Medication 2,000 2000 2000 2000 2000
Chickens 20,000 - - 20000 -
Food (balanced diet) 50,000 50,000 50,000 50,000 50,000
Water & Electricity 6000 6000 6000 6000 6000
Salary 82,800 84000 84000 84500 84500
Transportation 3000 3000 3000 3000 3000
Advertisement for (business card ) 1000 - - - -
etc
Total Operating expenses 194800 175000 175000 195500 175500
Revenues from egg sales 405,000 427,500 427,500 303750 225,000
From chicken sales - - 80000
Total revenue (sales) 405,000 427,500 427,500 383750 427500
Cost Of Sales Big+Pur-Ending inv. 41000 12340 13075 14110 14300
Gross Profit 364000 415160 414425 369640 413200
Income before tax 235069 240160 239425 174140 237700
Net Provisional Tax 70520.70 72048 71827.50 55242 71310
Net Income After Tax 164548.30 168112 167597.50 118898 166390

Description of Total Expense, Contingency, Total Revenue and Net income (profit) of the poultry
Business:
As indicated in the above table, the profit earned form the business in first year is small because of
the higher beginning expenses and the chickens lay eggs after three months from the start up. i.e. the
production plan fir the for first year is 9 months. There will be high income at 2 nd and 3rdyears
operation.

The product of the egg will decrease at 4 th and 5thyear, this is because some of the chickens will stop
laying egg due to upper age limit. There is a plan to replace the chickens with the young ones at the
end of 5th year in order to continue the business further to generate more profits from this sector.

Financial Plan
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As per agreement between the partners 40% of the profit will be retained to the capital of the business
which will assist to increase the size of the poultry farm. The financial plan is expected to be
reviewed and /or revised every five years time.

7. Organizational Plan
Responsibilities and Job Description of the partners as per the agreement made between the partners
each partners are assigned as follows:

General Manager:
 Controls of general activities of the poultry firm.
 Communicate with external organizations, gather information and discriminate it to the
partners as well as key workers of the business.

Finance Section:
 Controls and check financial flow of the partners.
 Controls the salesman.
 Act as G/Manager when the Manager is not available.

Purchaser:
 Purchaser all the necessary items for the poultry farm.
 Controls the stocks.
 Act as an accountant in the absence of finance head.


General Service:
 Controls all the employees of the poultry farm
 Act as a purchaser when the purchaser is not available.

Sales man::- Sales eggs and life chickens

Day laboures.
 Clean house for the chickens.
 Give food and water to the chickens.

Animal Health Asst.

 Treat and follow up the health status of chickens.

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  Our partner AtoSome provide necessary follow up related to the health condition of chickens
as additional part of his contribution in running the poultry business

8. Risk assessment
Failure to produce the products

Disease out break

Since chicken are living animals they are vulnerable to a lot of diseases that will result in devastating
the life of the chickens and their products. Therefore the farm planned strict bio-security measures to
prevent such occasions.

New Technologies
The invention of new sophisticated and poultry equipments for the purpose of computerized feeding,
hatching, etc are one of the challenge that may affect future expansion of the farm so the farm has
planned the fulfillment of such equipments for the next phase of production.

Contingency plan
The farm has kept contingent finance in its production plan for price variations that may occur during
operation time.

9. Conclusion
The city of Bishoftu engulfed with diversified urban problems. It is hard to fully implement the
envisaged development programs. One of the major problems of the city is shortage of poultries. The
demand of poultry is increasing from year to year. In this regard the participation of the privet sector
in the development endeavor of the city will curb the financial problem and help fill the mismatch
gap. Accordingly the opening of this poultry will play a great role in overcoming the shortage of
poultry in the city Bishftu town kebele 15 particular. Generally, it is believed that the initiation of this
project will contribute to the surrounding of Bishoftu town population.

10. Appendix
 Letter of agreement between partners.
 Letter to Oromia Trade Industry Bureau.
 Questionnaire to community to assess the demand and supply of poultry products.

1. partners agreed to establish babugaia Poultry business at Debre-Zeit.

2. The beginning capital of the poultry business is Birr 378,000 (Three hundred seventy eight
thousand birr) and all the partners have equal contribution and share.

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 3. The partners agreed to share 60% of their profit two times in a year and the remaining 40%
will be retained to their capital.
4. A partner (s) who resign or terminate with out sufficient reason before 5 Years of agreement
will not entitled his/her share.
5. A partner (s) who resign or terminate the agreement after 5(five) years of business
establishment shall be entitled his/her share and other benefits.
6. The partners are agreed to obey the rules and regulation written in this poultry business farm.

House Rent Agreement between babugaia poultry Business farm and for the char man of babugaia
Poultry business farm and Atosemo one have agreed up on the following terms
1. Atosome one the owner of House No. 567 in Kebele 16 Near babugaia area (Bushoftu town)
which has a size of 1000 square meter agreed to let the house for five years time with a rent of
Br. 30,000.00 (Thirty thousand) per year.
2. babugaia Poultry farm agreed to pay the amount indicated above per year in advance for five
years.
3. The House Rent agreement is effective as of February 22 , 2018.
4. Both parties have the ability to make agreement is non-acceptable.

Tentative guide lines/project/

1-Excutive summary
2-problem statement /need for project/why/?
3-feasibility study
3.1-market and demand analysis
I-situational analysis
II-data getting analysis
III-demand analysis
IV- Demand projection

3.2-financial analysis
I-initial investment cost
A-fixed cost
B-pre-production expenditure
C-start up&commissioning expenditure
d- working capital expenditure
II-operating cost/production cost
a- Production cost
b- Marketing cost
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 c- Administration cos
III-projected financial rstatement for three years
a- Sales projection
b- Statement income
c- Balance sheet
d- Cash flow statement
IV-project selection tool
3.3-organization analysis
3.4-technical analysis
3.5-economical analysis
3.6-environmental analysis
4-source of finance
5-project management and control

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