JIMMA UNIVERSITY

COLLEGE OF BUSINESS AND ECONOMICS

DEPARTMENT OF MANAGEMENT

Business Plan Assignment

Tittle ; Biyafan Fruit Juice Processing Enterprise

Jimma ,Ethiopia
Prepared by:-

1. DESALEGN TUFA…………………..0172/10
2. ENDALKECHEW MEKONEN……0198/10
3. DANSOYE WAKO…………………0169/10
4. HAYIMANOT ABEBE…………….0273/10
5. HABTAMU GETENET …………..0260/10
6. LETA GEDEFA ……………………0524/10

Submitted to: - DEBEBE.A. (ASSIST.PRO)

JAN. 2021

JIMMA, ETHIOPIA

TABLE OF CONTENTS
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Contents Page

1. EXCUTIVE SUMMARY……………………………..........................................1

1.1 Key Success……………………………………………………………………..1

1.2 Name and Address of the Business………………….…………………………..2

1.3. Nature of the company………………………………………………………….2

1.4. Statement of Financial Need……………………………………........................2

1.5. Statement of Confidentiality of Report…………………………………………2

2. COMPANY OVER VIEW …………………...................................................................3

2.1 company vision statement ……………………………………………………….3

2.2 company mission statement…………………………………………………........3

2.3 Goals of the company…………………………………………………………......3

2.3.1 Short term goals……………………………………………………………...…3

2.3.2 Long term goals………………………………………………………………....4

3. INDUSTRY ANALYSIS…………………………………………………………………....4

3.1 Description of market plan place…………………………………………………..4

3.2 Office equipment……………………………………………………………….….5

3.3 Market Segmentation…………………………………………………....................6

3.4 .Industry forecast………………………………………………………………..…6

4. CUSTOMER ANALYSIS……………………………………………………........................6

5. ANALYSIS OF COMPETITORS……………………………………………………………...6

5. 1 Competitive advantage…………………………………………..............................7

6. MARKETING PLAN…………………………………………………….………….7

6.1 Demand and supply analysis………………………................................................7

6.2 general manager ……………………………...........................................................7

6.3. Quality manager……………………………………………………………..….…8

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 6.4 market manager………………………………….....................................................9

6.5 financial manager………………………………………………………………..….9

6.6 research and development office…………………………………………………….9

6.7 pricing…………………………………………………………………………….….9

6.8 distribution strategy…………………………………………………………….……9

6.9 promotion strategy……………………………………………………………….….10

7. ORGANIZATIONAL PLAN……………………………………………..………….….10

7.1 Legal Form of Ownership …………………………………………………………..10

7.2 Roles and Responsibility of Members of the Organization……………………….....10

8. PRODUCTION PLAN (OPERATIONAL)……...............................................................11

8. 1 ASSESMENT OF RISK……………………………………………………………..11

9. START-UP CAPITAL……………………………………………………………………12
9.1 Sources of Start-up Capital…...12

9.2 Pro-Form Income Statement………………………………….. …………………,,,…..13

9.2.1 Salary Expense …………………………………………………………..………….13

9.2.2 Depreciation Expense………………………………………………………………..14

9.2.3 Miscellaneous Expense……………………………………………………………...14

9.3 Cash-flow projection……………………………………………………………….,,,….15

9.4 Operating Balance sheet……………………………………………………………,,,,….16
9.5 Break-Even Analysis………………………………………………………………...…....16

10. APPENDIX………………………………………,,,……………………………….........18

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INTRODUCTION

COMPANY NAME

BIYAFAN FRUIT JUICE PROCESSING ENTERPRICE

1. EXCUTIVE SUMMARY
Biyafan Fruit juice processing enterprise business will be run as partnership. The enterprise offer
high quality juice for customers. Juice will be available for sale at wholesalers and retailers. The
price is affordable should not annoy or exploit customers So that customers are willing to pay.
Juice providing enterprises will provide its product at market price by identifying and listing
each type of fruit juice with their fair prices.

The main job in this business is purchasing and processing quality juice, preparing warehouse to
store the product, monitoring and auditing sales of business. The main objective of the business
is to provide quality of juice in order to get the expected profit and to satisfy the customers, have
a claim to create job opportunity, providing complementary and with fruit juice and plans to
expand the business in different area and also to expand the initial business in size.

In the beginning year the business forecast some profit. In the second year and third year we
expect that there will be increment of profit due to further increases in the number of customers
and get acceptance. The overall and general objectives of the business are mainly to achieve and
exceed sales forecasts to enable the business to be operating at capacity, so that the business
extended the types of fruit juice that enables the business to meet the customers need.

1.2 NAME AND ADDRESS OF THE BUSINESS

The name of the enterprise is Biyafan fruit juice processing. The reason that we assigned this
name to the business is to show the concern for the Jimma zone fruit production and as the sun
rises at the east and gives light for the entire world, our enterprise products also marketing all
over our country and even for exporting purposes of all over the world. Fruit juice processing is
located in Jimma town. This location is a great opportunity to get different kinds of customer
from Jimma town society, Jimma University society.

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1.3. NATURE OF THE COMPANY
As the name of the business center indicates the initial focuses on providing different types of
high quality of different fruit juice to the people who come to this Biyafan fruit juice processing.

Biyafan fruit juice processing, providing enterprise is established to overcome the absence of
such type of fruit juice center in this area. This business center provides different juice for Jimma
town society and Jimma university society. It serves as entertainment area for community
especially for University students and it also contribute for the development of Jimma town.
Basically this business is believed to reduce unemployment by creating job opportunity for many
people.

1.4. STATEMENT OF FINANCIAL NEED

Biyafan fruit juice processing provides enterprise planned to construct and establish a company
with capital of 250,000 birr. The business requires means of acquiring this initial capital by
borrowing from financial institution like: banks, personal capital, and micro finance institution.

1.5. STATEMENT OF CONFIDETIALITY OF REPORT

The owners of Biyafan fruit juice processing, spends knowledge, money, time, resources, and
experience to prepare project plan. For this reason the owner have to have the patent right in
order to protect the project plan which is the result of all share holder effort for this reason
should not be transferred or copied to another individual or company. If anyone refuse to accept
this, the owners have right to accuse individual or the company to bring them in front of the law.
“All Rights are reserved”

It is known that many types of business implements in each and every aspect of our area and this
comes with interaction of different countries in all aspects of socio-economic and cultural
dogmatism with the beginning of Biyafan fruit juice processing. This is because of comfort
ability of various kinds of environment which assist or help people to lead their life in a good
manner and encourage a main accent in standard of excellence in their life as well The primary
purpose of this project plan is to provide qualitative and quantitative amount of various types of
fruit juice at affordable price.

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3 INDUSTURY ANALYSES

3.1 Description of Market Plan Place

The fruit juice business enterprise provides fruit from mizan, Agaro and local market. This
product is sold to customer around the Jimma town. This product also sold to small enterprise
found around its environment. The product of our business is fruit juice product. So, any
individual who has the potential can undertake the activities. The brand of the business is
designed to be fruit juice processing providing enterprise; it is named so because its name and
the service it gives are much more related and attractive. Since it is natural product the people are
willing to use the service. The location of the business is Oromia regional state, Biyafan zone
Jimma town.

The location is preferred for the following reasons

 There is no such business enterprise around this area.

 There are many customers for the service.
 Different types of raw materials are available
 Weather condition is comfortable.
 The transportation cost is less.

In order to accomplish the service effectively and efficiently our business hires workers based on
the following criteria.

 Experience
 Health
 Conduct
 Educational level
 Age
 Ability
3.2 Office Equipment

The materials needed would be:

 Stainless steel knife

 Spoon
 Fork
 Juice processing equipment
 Glasses with different size and design
 Chopping board
 Chair
 Pulpier

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  Balance
 Refrigerator
 Shelf
 Table
 Jar(bottle)

Those mentioned materials will be purchased. The business manager should be experienced at
least in business and should have knowledge of entrepreneurship. The special ability of the
manager to dominate or have complete power on others is that he/ she can communicate with
others, understand technical problem, persistent, self-confident and have good conduct.

The motivational to start this new business is

 Desire for independency.

 Desire to exploit opportunity.
 To turn our hobby into reality.
 To change previous work experience in to business.
 Financial incentive.
 To reduce unemployment.

3.3 Market Segmentation

Actually the business enterprise is not limited to local market or internal market rather than
external market. So our fruit juice processing is comfortable to export to other countries. They
are profit oriented, gradually involves in the production of different fruit juice.

3.4 Industry Forecast

There is no doubt that the people need to recreate themselves. Because recreation is basic human
need. Biyafan fruit juice processing is a place to recreate peoples, so this type of business is
going to expand in the coming year at increasing rate.

For this reason our business paves the way for those who want job opportunity for the society
surrounding Jimma town. For those who came from another place it is serving as entertainment
area.

We predict that in future our business will be expanded and will have many branches in different
places. In the case it will increase the number of customer and this is the cause for the
development of the enterprise itself.

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4. CUSTOMER ANALYSES

Our target customers are

 The Jimma university society

 Jimma town society
 mizan and Agaro fruit juice distributors

Most of our customers need is good quality and sufficient quantity of fresh fruit juice.

5. ANALYSES OF COMPETITORS
Fruit juice processing business is well known and has good profit in other place. But in our area
it is not recognized this much. Even if there is no known fruit juice processing in this area, there
are some competitors’ who competes with us.

Some of our direct competitor’s area

1. Jimma college super market

2. Jimma town super market and retailers

Our indirect competitors are

• Restaurant service in Jimma town,

• Expansion of recreational lounge

The strength of our competitors is that they have high initial capital and also have enough man
power. In addition they have enough space for producing large number of fruit juice products.

Their weakness

 They provide poor quality

 Their service of time is limited
 They do not respect their customers

5.1 Competitive Advantage

The competitive advantages of our business are listed in the following manner

 We provide quality fruit juice for our customers better than our competitors
 Our business entertain customers who are in different age level
 It address customers need with lower price
 Proximity to suppliers
 Initiated workers

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 6. MARKETING PLAN

6.1 Demand and Supply Analysis

Most of the time demand and supply do not balance each other. To balance Supply with
demand we must do a continuous assessment on the number of our customer. We must
identify the primary need of our customers. We have to measure the daily, weekly, monthly
and yearly consumptions of the customer and compare with our products. By carrying out
this process we can balance demand and supply.

6.2 Pricing Strategy

The basis for our fruit juice prices is the market price and cost-benefit analysis. Even if our
competitors have no so much strength, we can reduce our price in order to attract and get our
customers attention; as a result we can increase our profit from large number of customers.
Actually the price of our product is not below the market price; as a result, fruit juice providing
business enterprise set the price of juice as the markets that are it fluctuates over the time with
market price.+

6.3 Distribution Strategy

The distribution of the Biyafan fruit juice processing to consumers can be distributed in different
ways. Like: Whole sales, End users, Retail services and direct delivery to consumer’s house.

6.4 Promotion Strategy

Our promotion strategies are applied using the following methods:-

 Newspaper Magazines
 Business card
 Notice
 Sponsorship for short radio programs

7. ORGANIZATIONAL PLAN

7.1 Legal Form of Ownership

Fruit juice processing providing business enterprises are a type of business in the form of
partnership. The reasons for the selection of this form of business are:-

 Profit gained in the first time it established.

 Simplicity to establish the firm.
 Accessibility of raw materials.

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The overall operation or function of the business would be governed or administered by the
owner. The owner can be manager, and sometimes there may be needed to hire the manager from
the outside people that can fulfill the following criteria:

 Have the knowledge of entrepreneurship.

 Sociability.
 Ability to manage others.
 Risk taker.
 Experienced.

7.2 Roles and Responsibility of Members of the Organization

The role of the manager will be managing the overall activity of the project. That is:-

 Making decision regarding the state of business in the future.

 Controlling the overall activity in the business.
 Evaluating the quality of the products (juice).
 Making decision regarding processing.
 Lift up or move up capital contribution.

The business will contain the following members:-

 Owners
 Employees (Permanent and Temporary)

8. PRODUCTION PLAN

Basic Equipment needed is:

• Raw fruit

• Wear (workers uniform)

• Fruit pulpier

• Processing equipment

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Generally the cost of project activity includes the following.

 Cost for different raw fruit

 Cost for house rent
 Cost for water
 Cost for electric power
 Cost for telephone
 Cost for labor force
 Cost for license

8. 1 ASSESMENT OF RISKS

The predetermined or expected risks are:-

 Spoilage of juice.
 Expiration of fruit juice and contamination.
 Loss of income from spoiled and expired item.
 Loss of customers.
 Natural hazardous.
 Scarcity of raw fruit from farm.
 Damage of raw materials from car accident.
 Fluctuation of market price (devaluation, inflation, deflate)

9. START-UP CAPITAL

The supplementary financing is required to being work on site preparation, equipment purchases,
and to cover expense in the first year of operations.

No Item of name Quantity Unit price Total cost

1 Mango fruit 5,000kg 10 50,000
2 Papaya fruit 5,000kg 15 75,000
3 Avocado fruit 4,000kg 10 40,000
4 Fruit pulpier 3 1,200 3,600
5 Employees 10 (500*4*12) 45,600
+
(300*6*12)
6 Processing 1 5,000 5,000
equipment
7 Handling materials 10 50 500
8 Miscellaneous cost - 3,000 3,000
Tota 222,700
l

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9.1 Sources of Start-up Capital
Additional financing has already been secured in the form of:-

 The project plan is prepared to obtain funds amounting 80,000 birr.

 Birr 22,700 from personal capital and
 Birr 120,000 from closed relatives, government, and NGOs.

Organization and staff

Staff responsibility and qualification

1. General Manager DESALEGN TUFA

2. Marketing manager ENDELKECHEW MEKONEN
3. Food Technologist HAYIMANOT ABEBE
4. Food Specialists DANSOYE WAKO
5. Finance Manager HABTAM GETENE
6. Information manager LETA GEDEFA

9.2 Pro-Form Income Statement.

The sale of revenue of fruit juice is expected to be calculated daily the price of each type of juice
we take, the approximation of the sales of monthly on average to be 19,000 birr. Hence there are
12 months in business year total annual revenue is calculated as follows

Total revenue= 19,000*12=228,000 birr

9.2.1 Salary Expense

We have ten employees out of them, four permanent workers and the remaining six are
temporary workers.Each of the four permanent workers out of the ten earns 500birr and
remaining six workers earn 300 birr per month:
Total salary for workers= (500*4*12) + (300*6*12) =45,600birr

This is a salary for these permanent workers per a year plus a salary for the remaining temporary
workers person per a year

Total salary expense= 45,600birr

9.2.2 Depreciation Expense

The Biyafan fruit juice processing enterprise has some depreciation expense. And it expected to
be 2000 birr.

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Total depreciation cost (Expenses) = 2000birr

Interest Expense= principal*interest rate

=190,000*10%

=19,000birr

9.2.3 Miscellaneous Expense

Items Quantity Unit price Total price

Agenda book 5 10 50
Electric power 200
Pen 12 4 48
Uniform cloth 5 50 250
Telephone 60
Water cost 100
Total 708

Pro-forma income statement as of year 1

Revenue
Sales-------------------------------------------------------------------------------------190,000
Expense
Total Salary Expense-----------------------------------------------------------45,600
Depreciation Expense-----------------------------------------------------------2,000
Interest Expense -----------------------------------------------------------------19,000
Miscellaneous Expense----------------------------------------------------------708
Total Expense---------------------------------------------------------------------------------87,308
Gross Profit -----------------------------------------------------------------------------------102,692
In the second year of operation it is assumed that the business will increase the provision of juice
and overall sales from 190,000 birr/month to 200,000 birr/month on average.

Revenue 200,000*12=2,400,000

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  Pro-forma income statement of year 2

Revenue
Sales-------------------------------------------------------------------------------------2,400,000
Expense
Total Salary Expense-----------------------------------------------------------45,600
Depreciation Expense-----------------------------------------------------------2,000
Interest Expense-----------------------------------------------------------------19,000
Miscellaneous Expense---------------------------------------------------------708
Total expense--------------------------------------------------------------------67,308
Gross profit ----------------------------------------------------------------------------2,332,692

In the third year of operation it is assumed that the business will increases the operation of by
volume from 200,000 birr to 210000 birr per month, using full capacity at efficiency. Therefore
Revenue annually= 210000*12=2,520,000

Pro-forma income statement of 3rd year

Revenue
Sales-----------------------------------------------------------------------------------2,520,000
Expense
Total Salary Expense-----------------------------------------------------------45,600
Depreciation Expense----------------------------------------------------------2,000
Interest Expense-----------------------------------------------------------------19,000
Miscellaneous Expense----------------------------------------------------------708
Total Expense ---------------------------------------------------------------------67,308
Gross profit -----------------------------------------------------------------------------2,452,692

9.3 Cash-flow projection

Cash flow statement for year 1

Cash Budget Total
Beginning cash balance-------------------------------------222,700
Cash collected from customers------------------------------190,000
Total cash available for need-----------------------------------------------412,700
Operating Expense------------------------------------------67,308
Total cash needed ----------------------------------------------------- ----67,308
Cash Excess deficit --------------------------------------345,392

Cash flow statement for year 2

Cash Budget Total
Beginning cash balance------------------------------------ 345,392
Cash collected from customers---------------------------2,400,000

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 Total cash available for need ------------------------------------------------ 2,745,392
Operating Expense------------------------------------------67,308
Total cash needed --------------------------------------------------------------67,308
Cash Excess deficit ------------------------------------------2,678,084

Cash flow statement for 3rd year

Cash Budget Total
Beginning cash balance------------------------------------ 2,678,084
Cash collected from customers---------------------------2,520,000
Total cash available for need ------------------------------------------------5,198,084
Operating Expense------------------------------------------67,308
Total cash needed------------------------------------------------------------67,308
Cash Excess deficit ------------------------------------------5,130,776

9.4 Operating Balance sheet

Asset Liability
Cash--------------------------------345,392 Account payable------------------45,600
Fixed asset-------------------------96400 Note payable----------------------190,000
Miscellaneous Expense----------708 Total Liability--------------------235,600
Total asset------------------------222,700 Capital
Capital -----------------------------12,900
Total liability and capital ---------222,700

Pro-forma Balance Sheet at the end of 1st year

Asset Liability
Cash --------------------------------345,392 Account payable------------------45,600
Fixed asset---------------------------96,400 Note payable----------------------190,000
Depreciation-----------------------(2000) Interest payable---------------------19,000
Operating Expense-------------------67,308 Total liability-----------------------254,600
Total asset----------------------------511,100 Capital------------------------------256,500
Total liability and capital---------511,100

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Pro-forma Balance sheet as the End of 2nd year
Asset Liability
Cash -------------------------------2,678,084 Account payable------------------45,600
Fixed asset--------------------------96,400 Note payable----------------------190,000
Depreciation-----------------------(5000) Interest payable---------------------19,000
Operating Expense-----------------67,308 Capital-----------------------------2,519,884
Total asset------------------------2,774,484 Total liability and capital ------2,774,484

Pro-forma Balance sheet as the end of 3rd year

Asset Liability
Cash -------------------------------5,130,776 Account payable------------------45,600

Fixed asset--------------------------96,400 Note payable----------------------190,000

Depreciation-----------------------(10000) Interest payable--------------------19,000

Operating Expense------------------67,308 Capital------------------------------4,972,576

Total asset-------------------------5,227,176 Total liability and capital-------5,227,176

Appendix

The total area we provide for fruit juice processing plant is 20x30 (600 square meters).The area
is divided in to small partitions for each different fruit juice.

The total production area of our business is 600 square meters including the area of storage
areas.

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