CHAPTER ONE EXECUTIVE SUMMARY 1.0.0 INTRODUCTION This chapter gives the summary of all activities that have been carried out in the business plan. The name of the business will be WAN COMMUNICATIONS and will be dealing with selling, installation, repair and maintenance of communication equipment. The form of a business will be sole proprietorship owned by EDWARD OMONDI KASUKU. 1.0.1: BUSINESS DESCRIPRTION The proposed business will be WAN COMMUNICATIONS address will be:- WAN COMMUNICATIONS P.O.BOX 32, KAPSABET EMAIL:[email protected]It will also buy and sell those hardware components to customers. The owner will ensure that services are offered and goods produced are of high quality and also the business should meet legal requirements. 1.0.2: BUSINESS LOCATION The business will be located in Kapsabet Town along. The form of business will be sole proprietorship and will offer quality services that will justify the time and money spent on it. The business is well located and therefore cases of insecurity, lack of communication and in fracture will hardly affect the running of the business. Therefore WAN COMMUNICATIONS will operate smoothly without much 1
Transcript
CHAPTER ONE
EXECUTIVE SUMMARY
1.0.0 INTRODUCTION
This chapter gives the summary of all activities that have been carried out in the business plan. The name of the business will be WAN COMMUNICATIONS and will be dealing with selling, installation, repair and maintenance of communication equipment. The form of a business will be sole proprietorship owned by EDWARD OMONDI KASUKU.
1.0.1: BUSINESS DESCRIPRTION
The proposed business will be WAN COMMUNICATIONS address will be:-
It will also buy and sell those hardware components to customers. The owner will ensure that services are offered and goods produced are of high quality and also the business should meet legal requirements.
1.0.2: BUSINESS LOCATION
The business will be located in Kapsabet Town along. The form of business will be sole proprietorship and will offer quality services that will justify the time and money spent on it.
The business is well located and therefore cases of insecurity, lack of communication and in fracture will hardly affect the running of the business. Therefore WAN COMMUNICATIONS will operate smoothly without much interruption and tense the business will have high potential prosperity.
1.0.3: MARKETING AND PROMOTION STRATEGY
The business will ensure good relationship with the local, town dwellers, visitors who come to visit the town i.e. Tourist. Due to this good relationship, the business will earn a good name across the country therefore marketing computer hardware services and products will probably be done locally and nationally.
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The business will advertise its products through:-
i. Posters.
ii. Television stations.
iii. Radio.
iv. Newspapers.
v. Magazines.
Due to high competition in the market WAN COMMUNICATIONS will ensure that employees will be motivated through:-
a) Increasing salary as per their output
b) Rewarding hardworking employees.
c) Ensuring numerous training
d) On time payments
e) Reduction of robbers of time
1.0.4: ORGANIZATION AND MANAGEMENT PLAN
WAN COMMUNICATIONS will be owned and managed by EDWARD OMONDI KASUKU who will the owner and manager of the business. In support to the owner, an office assistant will be employed. In the repair section and maintenance of the machines, a technician will be responsible. Also he requires the counter attendant to serve as a receptionist and receive payments. Also a driver will be required incase of transportation of products outside the business premises. For smooth running of the business, the enterprise will incorporate the use of remote monitoring i.e. the business will use services burglar detect events such as motion or a sudden impact e.g. breaking glass. This will be for ensuring customers security while in the enterprise.
1.0.5 OPERATIONAL PLAN
WAN COMMUNICATIONS will sell / offer quality services according to the requirements of existing market. Services offered by the business will be categorized according to the type. The prices will also vary depending on the type and amount of
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services offered. WAN COMMUNICATIONS will ensure that all people despite their status are catered for. Hence the business will offer services at a fair price to its customers.
1.0.6: FINANCIAL PLAN
WAN COMMUNICATIONS will require KSHS. 1,000,000.00 of which KSHS.660, 000.00 will be loan from bank and KSHS.340, 000.00 from owner’s savings and relatives contribution. The management will ensure that the capital is well utilized and will have to operate within the financial limit. Records will be well kept for future references.
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CHAPTER TWO
BUSINESS DESCRIPTION
2.0.0 INTRODUCTION
WAN COMMUNICATION will be a sole proprietorship form of business, operated by Edward Omondi Kasuku. It will be located in Kapsabet Town Centre, opposite the Bus Terminal. It will operate by the name WAN, which is an abbreviation for the phrase “Wide Area Network Communication.”
The business will be owned by Edward Omondi Kasuku. He was born in 1985 in Muhoroni Sub location, Chemelil Location of Nyando District in Nyanza Province. He attended Red Towers Nursery School and Nandi Township between 1990 to1998. He then sat for the K.C.P.E and attained 451 marks.
In 1998, He joined Ngere High School for secondary education. After four years, He successfully completed his education, scoring a mean grade of B minus. During His O-level education, he was participant in scouting activities.
In 1999, he joined Chemelil Sugar Company as a casual worker. He also helped his parents in a family Boutique Shop where he acquired entrepreneurial skills. He later joined Celtel Kenya (now Zain) Kapsabet Branch as a sales representative. He was then transferred to Eldorate where he worked until when he was recruited into the National Youth Service.
On 20th April 2006, he reported to N.Y.S Training College in Gilgil. He then under six months Para-military Course where He was taught;
On completion, he was posted to N.Y.S Athi River Filed unit where He served as a radio operator for one year.
In January 2008, He joined N.Y.S Engineering Institute to study Diploma in Telecommunication Engineering, for three years.
Despite being trained as a Technician, Edward would like to use gathered and sharpened in various enterprises to start up and run a business successfully, exploit the available natural resource in order to boost his income, as well as create employment in the telecommunication industry.
2.0 .2 MISSION STATEMENT
To own a growing, financially successful business through the exploitation of available resources to increase sales and excellent profit achieved through fast and quality services to all customers at all times.
2.0.3 BUSINESS NAME AND LOGO
The name WAN communications is derived from the phrase “Wide Area Network Communications.” The abbreviation is easy to pronounce, clear and can be remembered. It describes communication over a wider topographical area, a service that the firm will offer to its customers. It is thus deemed best as it relates to the communication industry in which the business belongs.
The business logo will be as on the cover page.
2.0.4 BUSINESS CONTACT AND LOCATION
The business venture will be situated in Kapsabet Town, opposite Kapsabet Bus Terminal. This location is selected as it is a central point in the Town. It is also accessible to all the travelers to and into the outskirts of the Town. It has better infrastructure e.g. electricity. The level of competition will be relatively low, since there are few electronic and communication firms already established within this vicinity.
The enterprise will be a sole-proprietorship. This form of business will be chosen as it has the following
Advantages
(i) Easy to start.
(ii) Needs few legal requirements to initiate.
(iii) Be the sole decision maker.
(iv) Enjoy all the profit.
(v) Enjoy being his boss.
(vi) Faster decisions making.
Disadvantages
(i) Contribute all the capital.
(ii) Bear all the risks.
(iii) No specialization
2.0.6 TYPE OF BUSINESS
WAN communication will be registered and operated as a retail shop. It will majorly deal in selling of consumer electronic and telecommunication equipments.
Repair and maintenance of these equipments will also be available to diversify on sales earn the business more.
2.0.7 INDUSTRY
This venture will fall under Telecommunication and Electronic industry, under the umbrella of Ministry of Communication. It is regulated by the Communication Commission of Kenya (CCK).
Historical background
In the ancient days, this industry used fire and smoke, drum beating, messengers, signs and signals to effect the transfer of information at a distance. When electronic vacuum tubes were invented, circuits which could replace the above mentioned traditional methods of communication were developed to revolutionize the industry.
Then the transistor technology evolved that led to the development of the first electronic Morse code Key, Telegraph and Telephone devices. Due to growing technology and research carried out in the Bell Laboratory, the transistors were developed into smaller chips with enormous number of transistors. I.e. Integrated circuits (IC). These led to further development and enhanced communication rate as well as distance through wireless devices.
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Today, the industry uses 3G technology with fairly robust gargets, enhanced data and voice communication speed of communication. These devices support several communication modes unlike the previously used. The key players in this industry currently are:-
(b) Telecommunication firms (i) Safaricom(ii) Zain(iii) Orange(iv) Telecom Kenya(v) Essar Kenya (YU)(vi) Wanainchi online(vii) Kenya Data Networks (KDN)(viii) Access Kenya(ix) Africa online(x) Broadcom ltd, e.t.c.
(c) Radio and T.V station such as;-(i) K. B. C(ii) Kiss100(iii) Nation Media(iv) Royal Media Services e.t.c.
2.0.8 BUSINESS GOALS AND OBJECTIVES
a) Short term
To make profit, enhance high level of ethics, excellence, innovation and integrity by being courteous to all customers at all times.
b) Medium
To improve service delivery in the industry by utilizing the new technologies that are more efficient in cutting operation costs and bringing better services to customers.
c) Long Term
To be a premier firm that introduces new technologies to the market, with a balanced approach towards people, offer quality services and to achieve wide profit margins.
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2.0.9 PRODUCTS AND SERVICES
The business will deal ion such product and service as listed below. Any other new product and technology invented will be introduced into the market as soon as it’s unveiled.
GOODS
a Office desktop phones
b Mobile phones
C Phone Covers
d Phone Batteries
e Phone Chargers
f Memory Cards
h Radiation Reflectors
i Network SIM Cards
j Networking Cables
k Routers
l Switches And Hubs
m Modems
n U. S. B and Patch CORDS
o U. P. S
SERVICES
a Repair
b Maintenance
c Configuration of new equipments
d Networking
e Installation of antennae
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2.1.0 JUSTIFICATION OF THE VENTURE
There exist a business opportunity within the location of the venture due to such factors as:
i) Low competition
Since the business will be located within Kapsabet bus Terminal that has no such similar strong and established business.
ii) Security
The chosen area has adequate security due to the closely established Kapsabet police post which is just 500metres away. The owners will also contract a security firm to guard the holdings at night.
Customers will also feel secured as the shop will be in an open place next to other ventures and is near the Bus Terminal.
iii) Location of the business
It will be strategically chosen opposite bus terminal in order that it be accessible to all traveling into or from the out skit of the town other than serving the habitants of Kapsabet Town market hence more sales.
iv) Bright future of the industry
Due to the entry of several internet and mobile communication providers into the industry, these firms are expected to extend their services to grass root level. The sponsor intends to exploit this chance and sell to the consumers all devices required in order to enjoy the coverage that will be provided by the firms and make profit out of these sales and servicing as well as maintenance of their equipments.
2.1.1 ENTRY AND GROWTH STRATEGY
a) Entry
The proprietor will exploit the fact that competition is healthy to customers. He will sell goods and offer services at a lower cost and charge compared to its competitors, but at a profit. All the prices and charges will be reasonable with all customers needs catered for to maintain and attract more since the business needs to grow. Goods and services will be of best quality. There will be special opening offers, extensive advertisements through road shows, billboards, handbill, and mass media.
b) Growth Strategy
The owner will facilitate the growth by expanding the market through sales representatives and distributors to sell items directly or indirectly to the outside market for two years. He conducts frequent market survey by approaching his competitors as clients and accessing their products and service demand. Any realized and unsatisfied demand will be exploited for the growth of this venture.
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In future, he will install computerized systems to improve efficiency at work. This will result in:
Improved service delivery.
Enhanced record keeping.
Reduce number of files kept within the premises.
Enhanced data control and security
After 15years the owner wishes to expand to limited company, then to a multi-national firm.
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CHAPTER THREE
MARKETING PLAN
3.0.0 INTRODUCTION
This chapter outlines how the proprietor will popularize the business and his plans on handling the already existing competitors and customers to ensure success.
3.0.1 CUSTOMERS
(a) Learning Institutions
Will include schools with computer laboratories which are:- Kapsabet Boys, ST Mary’s Girls ST Peter’s Boys. Rocky Computer College Modia Computer Yahweh Bible School.These will include Hostels, Restaurants and others offering conference facilities e.g. Sunshine 1994 Keben Hotel Kapsabet Hotel and Guest houses.
(b) Companies
These will includes firms within the defined market that will require communication links for effective day-to-day business. Are to include:- (i) Chebut Tea Factory(ii) Kamobo Tea ltd(iii) Nandi Tea Factory(iv) Jego Milk Processing Plant(v) Timsales sawmill
(c) Commercial customers
These are to include existing cyber café and communication beurrals. Examples identified are: -
Faith Cyber Café
E-land Cyber Café
Upland Communication
Motherland Computers.
(d) Individual Households
These will include any customer other than the above outlined, who require products and services in-order to satisfy personal communication needs. There are expected to purchase more during November to January, May and August.
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3.0.2 MARKET SIZE AND SHARE
Since the venture is new, it’s intended to command 32% of the total market size. The rest shared among the competitors.
The total population of the market is 34401 persons (according to the National census carried out in August 1999.) The business therefore aims to serve;-
32/100×34401 = 11,009 people
The pie-chart below helps to show the market share for the intended business and the competitors.
WAN COMMUNICATION 32%
TOMCOS SAFARICOM DISTRIBUTORS 24%
TENOKWE BEURRALS 22%
BURGEI COMMMUNICATION
22%
Market size is expected to grow with advancement in information technology and penetration of the market by new mobile telephone communication companies such as Orange, Telecom Wireless and YU.
3.0.3 COMPETITION
The venture will face competition mainly from:-
(a) TomCos Safaricom Distribution
This competitor is located 420 meters from the intended premises.
(b) Burgei Communication
This is situated just opposite the enterprise. The proprietor of WAN Communication worked there as an employee. It’s old and established but not expanding over a long period of time.
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(c) Tenokwe Communication Beurral
This is a recently started enterprise. It is located 200 meters away. It has young staff. However, they do not market products extensively. The competitors are mainly focused on sale of products. Their strength may be estimated as:-
(i) Large stock(ii) Computerized services(iii) More employees
On the other hand, their weaknesses are as follows;-
(a) Reluctant staff at the customer desk.(b) High prices and charges(c) Lack of professional Technicians(d) Time unconsciousness in product and service delivery(e) Delay in adopting new technologies
Lack aggressive Specialized dealer of Safaricom only
Existing demand
High taxing rate
New product in the market
Burgei Communication
Established Good equipments Many employees
Very expensive products Specialized dealer in Zain products
only
High market demand
High taxing policies
Tenokwe Communication Beurrals
Young and energetic staff
Lack publicity Very young business
Skilled employee who is readily available
Offering low quality product from competitors resulting into mistrust by customers
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A. Coping with competition
Wan Communication will diversify in terms of products and services to meet all the communication needs of all customers, unlike the competitors who are specialized on only one product; either Zain Kenya or Safaricom products.
There will also be related services offered to customers and such to include;-
(a) Structure and Cabling(b) Networking(c) Configuration and setting(d) Maintenance and repair
B. Coping with competitors
The venture will ensure it survives by using the competitors’ weakness to win in the market in the following ways:-
(i) High Prices and Charges
The business will reduce prices on goods and charges on services by at least 2% of that charged by the competitors so as to woo a large number of customers.
(ii) Delay in services and product delivery
The business will have adequate number of motivated staff, who is energetic enough to actively serve all customers at immediate time of need.
The staff will also possess the relevant technical skills.
(iii) Poor quality of goods and services
The business will be offering original products and high quality services. Where necessary the product will be tested for the customers for free before
carrying it way from the premises to assure them of the quality and effectiveness.
After sales services/ guarantee will also be provided for goods bought at the enterprise on specified terms.
(iv) Poor management and public relation
The management will constitute skilled personnel to ensure smooth administration.
Computerized systems will also be adopted for high efficiency.
(v) Operation problems
The proprietor will ensure there is proper coordination and handling of all business activities to ensure smooth and continuous running of the firm. This will ensure the customers are attended to all seasons.
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3.0.4 LOCATION AND MARKETING
Wan communication will be situated at Kapsabet Bus Terminal, Kosgei Plaza first floor. The location has the advantage such to include:-
(i) Central point thus accessible to many potential customers for all over the intended market.
(ii) Good security to make the customers buy from the enterprises at any time of the day.
(iii) Open and thus can be located by potential customers with ease.
3.0.5 SERVICE STRATEGY
The owner of the business will give discounts to customers as a means of relaying customers. Discounts will be based on quantity that the customers will purchase i.e.
i. Quality products and services
The owner of the business will provide quality products for sale. She will not deal with counterfeit goods, which are cheaper. She will rather sale authentic merchandise at a reasonable price.
ii. Credit facilities.
The owner of the business will offer credit facilities to customers whom she trusts and well known to her. Credit facilities will be limited to certain amounts depending on the customers.
iii. Proper management
This is meant to ensure that the customers puts the most skillful workers in the business who will render efficient services to their customers by proper delegation of duties to workers and ensuring that each participates fully for the business property.
iv. Advertising and publicity
This will be through advertising the business in the Daily Nation and Standard Nation magazines, signboards to create awareness of the business existence, product and services offered and create anxiety to customers who want to know what is being sold and its uniqueness.
v .Company Uniform
Employees shall report early to work, at workplace they will wear uniforms bearing the name “WAN COMMUNICATIONS, WE DON’T JUST SELL, WE CONNECT WORLDWIDE”.
vi. Evaluation of Market.
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He will be also able to scan the environment of the market and know the products that are fast and slow moving and prioritize them accordingly and know the customers favors to cater for them effectively.
3.0.6 PRICING STRATEGY
WAN Communication will determine such prices and charges on goods and services to ensure the firm;-
(a) Earns better profit margin.(b) Provide adequate after sales services.(c) Gainful credit terms.(d) Allow discount on certain goods and services to customers.
To determine such strategies, the proprietor will consider factors as;-
(i) Prevailing of demand in the market for the goods and services.(ii) Type of customers.(iii) Seasonal changes.(iv) Time of the day when the service is offered (day or night.)(v) Location of the customer’s premises.(vi) Use of competitive pricing.
The pricing structure will consider short term credit to customers classified under learning Institutions and companies and such that meet the legal requirement for this kind of contract.
Discounted prices will also be given to all customers at appropriate time, especially on cash purchase of goods during festive seasons.
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3.0.6.1 PRICE LIST
GOODS PRICE (Ksh)
a Office desktop phones 3,000
b Mobile phones 2,900
C Phone Covers 100
d Phone Batteries 250
e Phone Chargers 150
f Memory Cards 450
h Radiation Reflectors 70
i Network SIM Cards 50
j Networking Cables 1,500
k Routers 3000
l Switches And Hubs 1,500
m Modems 2,999
n U. S. B and Patch CORDS 300
o U. P. S 1,800
Laptop power Adopters 2,500
SERVICES Charges (KSHS)
a Repair 1,500
b Maintenance 2,500
c Configuration of new equipments 1,500
d Networking 1,500
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e Installation of Antennae 2,500
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3.0.6.2 SALES TARGET TABLE FOR 1st YEAR 2011
ITEM JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC TOTAL SALES
During the early stages will advertise goods and services extensively to create awareness of its existence to the general public. It will also employ such techniques to influence the attitude and behavior of customers to buy more from this business.
This will be achieved:-
(i) Using Posters
Several posters will be strategically placed within the intended business market location. These posters will carry such information as the direction of the business, product and services offered, the special offer prices and charges for goods and services on discount.
(ii) Through sign Boards
A sign board will be designed to show the location and direction of the business to potential buyers. It will strategically, few meters from the business premises. (Kapsabet- Kakamega junction will be the chosen site for this.)
(iii) By using Mass Media
Advertisement will be through TV and radio. This will be done in both Kiswahili and the local dialect. Magazines and newspapers will also be used to show price lists and pictorials of exact products as well as special offers and discounts available.
(iv) Through Mails and Hand bills
This venture will print handbills and give to the general public to provide them with the information on the products and services. These will be mailed to several institutions within the market. The handbill will contain the business address, phone number and location.
(v) Use of Music
The business will budget for DVD changer that will be used to promote the business. It will be played occasionally at a tone to attract music lovers to the business and then inform them of our products by the sales team.
Advertisement and promotion budget
FREQUENCY COST (Ksh.)
Calendars Beginning and end of the year 4,000.00
Posters Monthly 500.00
T- shirts Sports occasions and promotions 5,000.00
Local Magazines Quarterly 2,000.00
Road side shows Quarterly 12,000.00
TOTAL 23,500.00
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Evaluation of effectiveness of promotion and advertisement activities
The proprietor will assess the effectiveness of all techniques employed in all activities aimed at influencing buying habits of prospective customers and improving sales through:-
(i) Assessment of cash-in-flow and daily sales(ii) Assessment of profit margin(iii) Increase in growth of the total market share(iv) Expansion of the total market size
3.0.8 DISTRIBUTION STRATEGY
Customer will be served directly from the business premises. Any information on the operation of the equipment will be explained to the customers at the premise. Where necessary, the user manual will be explained to the customer by the sales team/ technician.
The business will also put in place transportation for customers who buy bulky equipments. However, transportation problems are anticipated especially during rainy seasons since roads to the outskirts are not all weather roads. The business will also consider the first customer to buy in bulk first.
3.0.9 SALES TACTICS
The venture will use various methods to obtain direct sales, satisfy customers’ needs, enhance sales appeal, recruit and retain the sales force The tactics will include:-
(a) Offering credit facilities The business will offer credit learning institutions and companies. They will be given one month to liquidate their debts.
(b) Quantity discountCustomers who will buy products more than one or of price more than Ksh 2500 will be offered a discount of at least 10%
(c) Quick servicesThe business will offer quick services to avoid queuing up of the customers, unlike in the competitors’ premises. Larger number of customers will therefore be served, this way promoting the general business sales
(d) Staff MotivationThe staff will also be motivated and good working conditions provided. This will promote there attitude towards there duties.
(e) Good communication
Better communication between the employees and employer will also be enhanced for better sales. Staff recruited will be of enough relevant competence and work in shifts to avoid overworking. Their salaries will be paid on performance basis. All appointed distributors and sale representatives will receive discounts based on total sale made per person.
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CHAPTER FOUR
ORGANIZATIONAL AND MANAGEMENT PLAN
4.0.0 INTRODUCTION
This chapter defines and elaborates ranks, responsibilities and qualification of personnel in the business enterprise from junior to senior staff. It also has details on remuneration, staff appraisal and development as well as communication within the organization.
4.0.1 BUSINESS MANAGER AND QUALIFICATION
The owner of the business will be the general manager. He will be the highest in hierarchy and will have such duties and responsibilities as:-
Duties and responsibilities
(a) Marking business decisions.(b) Planning and organization.(c) Coordinating activities within the business.(d) Supervision of business chores.(e) Delegation of responsibilities. (f) Fixing employees salaries.(g) Set rules and regulations to be followed.
He will ensure the business open and closes in time. Ensure good public relation. Will be in charge of procurement and will be the highest in hierarchy.
Qualifications Must be 25 years and above. Holder of Diploma in Telecommunication Engineering. Post graduate in Management courses is an added advantage.
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4.0.2 STAFFING AND PERSONNEL
The organization will have a total of Ten 10 personnel, exclusive of the manager. The organization structure will be as follows:-
Organizational Chart
(i) Assistant Manager
Will be second in hierarchy after the Manager and will be appointed by the manager.
Qualifications:-
(a) Must be above 25 years old.(b) At least 3 years experience.(c) Holder of Diploma in Telecommunication Engineering or equivalent.(d) C. P. A 1(e) Any administration experience is an added advantage.
Roles and Duties Implement all organizational decisions reached by the management team. Reports to the manager to give detailed account of daily activities within the venture. In charge of operation of the business. Will be the heads of accounts.
MANAGER/OWNER
OPERATIONS MANAGER
ACCOUNTS CLERK WORKSHOPTECHINCIAN
SALES TEAM
SECRETARY/RECEPTIONIST
CLEANERS
WORKSHOP TECHNICIAN
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(ii) Technicians
Roles and duties
He will be in charge of the workshop and stores. He will maintain and install all equipments to customer premises as guided by the
assistant manager. Carry out any other duties as delegated to him by the manager
Qualifications:-
(a) Must be at least 25 years old(b) Holder of Diploma in Telecommunication Engineering(c) Computer Application will be added advantage
(iii) Sales Team
The Team will ensure all the customers are given the best they need and deserves at the appropriate time. This will be achieved by marketing the product within and outside the enterprise building. They will make sale as per the set targets.
Roles and Duties
(a) Marketing the business name products and services.(b) Enhance the business image(c) Report to the Assistant manager to give accounts of daily sales and reports.(d) Serve customers both within and outside the premises.(e) Perform any other duties as maybe delegated to them by the authority.
Qualification:-
(a) Must be at least 18 years old(b) Holder of Diploma in Telecommunication Engineering, IT or Computer Science.(c) Must have Certificate of good conduct(d) Certificate in sale s and marketing will be an added advantage.
(v) Receptionist
Roles and Duties
(a) Will be in charge of customer care desk.(b) Direct customers and visitors within the premises(c) Will carry out typing and printing duties whenever need for such arise.(d) Will also be in charge of cleanliness of the premises.
Qualification
i) Has to be a lady between 21 – 27 years old at the time of her employment.ii) Computer literateiii) Must be able to speak fluent English and Kiswahiliiv) Be polite and self-disciplined, and can work for longer hours.
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(vi) Cleaner
She will ensure high standards of cleanliness in the premises. All his duties will be overseen and supervised by the receptionist.
Qualification
At least K. C. P. E certificate
4.0.3 RECRUITMENT AND SELECTION
All prospective employees will be reached and stimulated to apply through news papers, posters and radio broadcasting. To stimulate them, salaries will be stated for each relevant post announced as vacant.
This process will include:-
a. Advertisement of the vacant postb. Reception of application letters through mails and Emails.c. Invitation of those candidates who meet the specified requirementsd. Interviewe. Selectionf. Employment
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PERSONNEL QUALIFICATION AND RESPONSIBILITY TABLE
The qualification that the manager will be looking for in the candidates may be summarized as in the table below:-
PERSONNEL No QUALIFICATION ROLES AND RESPONSIBILITYASSISTANT MANAGER
1 Must be above 25 years old At least 3 years experience Holder of Diploma in
Telecommunication Engineering or equivalent
C. P. A 1
Implement all organizational decisions reached by the management team.
Reports to the manager to give detailed account of daily activities within the venture.
Will be the heads of accounts
TECHINCIAN 2 Must be at least 25 years old Holder of Diploma in
Telecommunication Engineering Computer Application will be added
advantage.
He will be in charge of the workshop and stores He will maintain and install all equipments to
customer premises as guided by the assistant manager
SALES TEAM 4 Must be at least 18 years old Holder of Diploma in
Telecommunication Engineering Must have Certificate of good conduct Certificate in sale s and marketing will
be an added advantage.
Marketing the business name products and services.
Enhance the business image Report to the Assistant manager to give accounts
of daily sales and reports. Serve customers both within and outside the
premises.RECEPTIONIST 1 Has to be a lady between 21 – 27 years
old at the time of her employment. Computer literate Must be able to speak fluent English and
Kiswahili Be polite and self-disciplined, and can
work for longer hours.
Will be in charge of customer care desk. Will carry out typing and printing duties whenever
need for such arise. Will also be in charge of Cleanliness of the
premises.
CLEANERS 1 At least K. C. P. E certificate Will ensure high standards of cleanliness in the premises. All his duties will be overseen and supervised by the receptionist.
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REMUNIRATION TABLE
PERSONNEL NO SALARY P.M.
SALARY P.A.
Managing Director 1 16,000.00 192,000.00
Operation Manager 1 14,000.00 168,000.00
Technicians 2 12,000.00 144,000.00
Sales Team 4 10,000.00 480,000.00
Receptionist 1 9,000.00 108,000.00
Sub-Ordinate Staff(Cleaner) 1 6,000.00 72’000.00
TOTAL 10 109,000.00 1,308,000.00
4. 0. 4 RETAINING AND MOTIVATING EMPLOYEES
WAN Communication will once they are employed if they are productive. This will be achieved through:
(i) Organizing of end year parties to all employees(ii) Paying for overtime work done(iii) Allowing offs and leaves(iv) Using democratic style of leadership(v) Salary Increment after every year
4.0.5 REWARD AND APPRAISAL
Reward is the compensation of employees’ effort beyond normal performance expectation. WAN Communication will ensure all such employees are rewarded at the end of every year. This will always be on commission as set by the management.
Performance is the process of determining how well the employees do their work compared to the company sets of standard and communication that information to them.
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The main rating that will be applied will include:-
(a) Trait based
These will be mainly used to access the personal characteristics of the employees as it relies on factors such to include:-
Communication skills
Loyalty
Attitude towards supervisor
Ability to work as part of a team
Decision making ability
(b) Behavior based
These assess employees on the behavior rather than their personal characteristic and will be used to assess the employees on friendliness toward customers’ helpfulness.
(c) Result based
WAN Communication will also assess the performance of employees on the base of the number of customers served.
Appraisal will be conducted by:-
Supervisor who rates the employees
Employee who rate their supervisors
Peers who rate each other
Customers who evaluate the employees performance
4.0.6 TRAINING AND DEVELOPMENT
WAN Communication will invest in training and development in order to modify the attitude, knowledge and skills of employees with a view of enhancing performance. Such will be conducted as necessary to instill a learning experience which seeks relatively permanent in an individual that will contribute to a better and enhance job performance.
Aim of Training and Development
To ensure that WAN Communication has competent employees that it needs to achieve the set short and long term goals.
To ensure that each of the staff has the required skills and knowledge necessary and relevant to carry out their duties competently.
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Importance of Training and Development
Improve the quality and quantity of output by improving skill.
Reduces errors at work.
Reduce supervision since the supervisor will spend less time in correcting errors.
Help the employees keep in touch with the changing and developing technologies.
4.0.7 COMMUNICATION
This is the process of passing information from within the organization to produce mutual understanding.
WAN Communication intends to use the following types of communication for smooth running and passing of information in the business.
(A) Download communication
This will include all forms of communication from a higher authority to staff in a lower level in the organization chart.
Advantages
(a) Specific information is clearly spelt out.
(b) Quick decision can be made when speed is required.
(c) Updates the subordinates with information about ration of their job.
(B) Horizontal Communication
This will cover all forms of communication between people in the same level in the management hierarchy in the organization chart.
Advantages
a) Promotes understanding and co-ordination among various departments in the business.
b) Enhance production due to co operation.
c) Better co-existence among workers.
d) Cohesion in leadership at the enterprise.
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4.0.8 LEGAL REQUIREMENT
WAN Communication will certify all the requirements by the government and local authority in order to be categorized as an existence company that will be tax compliant.
Such requirements includes:-
(A) Company Registration Act Cap 497
This will be done at Sheria House whereby the name will be logged and certified then authorized for use after payment of a fee.
(B) V.A.T Registration
This will be obtained for free after a proof of existence of the business, at the Kenya revenue Authority.
(C) P I N Number
This is issued at the Kenya Revenue Authority for free and helps in identifying the business for tax purpose.
(D) Trade Licensing Act Cap 499
This will be issued free of charge at by the Ministry of Trade and Industry. This will help to prove that the business really operates and is licensed by the government.
(E) County Council Certificate
The proprietor will obtain this at a fee from the Municipality of Kapsabet. It will help in County Council authorization to operation.
(F) Business License
The business will be licensed by Kapsabet Municipality Council Kenya Bureau Standards Act.
(G) Employee Act Cap 226
WAN Communication will comply with the Employment Act term that requires that all workers be insured by the NHIF.
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4.0.9 SUPPORT SERVICES
These will include any other service that will be provided to this organization to help normal operation. WAN Communication will need such services that will include:-
i. Banking Services
Such services will help the business operate an account and pay out the creditors or receive payments on behalf of the business.
Help keep in custody the business important documents and financial records.
Assist in loan advances to the business.
Equity Bank of Kenya,
Kapsabet Branch,
Main Street, P. O. Box 32,
Tel 0729760112
ii. Auditing service
Help in preparation of company financial statements and checking on the financial statements.
Help in filling of company tax returns.
Offer business advisory services.
Joel & Associates,
Main Street Kapsabet,
P. O. Box 32
Kapsabet.
Tel 0729760112
iii. Legal Services
These services will help in guiding the business when signing contracts as swell as protect the Enterprise rights and Facilitate a legal process in defense. Such services will be provided by:-
Arap Kosgei & Associates,
Main Street Kapsabet,
Kapsabet,
Tel 0713175011
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iv. Security Services
These services will ensure that the company premises and assets are all secure and protected for theft at all times. This will be provided for by:-
KK Security Ltd
Showground Kapsabet,
P. O. Box 55,
Tel 0727121245
4.1.0 MANAGING CHANGES
During the operation of the business, such factors to include:-economic, government policies, education, competition, technology, and social factors may bring changes in the venture. Therefore the business will be prepared for such eventualities. The main technique that can be use to curb these changes are:-
(a) Persuasion
(b) Training
(c) Job design
(d) Innovation and creativity
WAN Communication will adopt job design as the technique to manage changes. This technique refers to a conscious effort to organize tasks and responsibilities in a job to enhance satisfaction and avoid stress which in turn leads to motivation and discourage high rate of absenteeism. Job design focus on how work will be done. This will be implemented through;-
1) Job specification
Will involve breaking down jobs into smallest component and trying to assess how job is done in each of the components of the whole job.
2) Job Enlargement
Is the process of broadening jobs by adding together tasks together. Tasks involving similar skills and abilities will be combined together. This will help WAN Communication motivate who perceives increased responsibilities as a step to towards advancing their carriers. However, such will not be accompanied by additional compensation.
3) Job Enrichment
This is also called vertical expansion. In this technique, responsibilities are added to an employees’ job that is not extremely similar to the task the employee performs.
4) Job Rotation
WAN Communication will often deploy its employees to different departments to perform different tasks in the organization. This will help alleviate some of the boredom that employees may face because of performing the same job over and over. This system will require that the employees be trained in several jobs.
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CHAPTER FIVE
OPERATION AND PRODUCTION PLAN
5.0.0 INTRODUCTION
This chapter outlines all the activities that the venture will carry out. Such will include:-
(a) Sale Telecommunication Equipments.
(b) Installation and configuration of new equipments.
(c) Repair and Maintenance.
(d) Networking.
Good operation strategies will ensure that WAN Communication Ltd attains maximum utilization of available resources. It will also take advantage and capitalize on competitors weaknesses and carry out timely market survey, to understand market requirements in order to adopt efficient techniques in operation.
5.0.1 OPERATION FACILITY AND CAPACITY
WAN Communication will require machinery and equipments in order to use to render satisfactory services to meet customers’ needs to ensure continuity and profitability of the organization. Such tools can be classified as in the table in the next page.
The organization will formulate a plan whereby equipments will be received, recorded, sorted then issued to the relevant section of the enterprise.
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MACHINES , TOOLS AND EQUIPMENTS
NAMECAPACITY QTY UNIT COST TOTAL
COSTSUPPLIER
Office furniture 120,000 Jacaranda Wooding ltd
Digital Meters 240-100 mA 3 500 1,500 Star Electronics ltd
Tape Measure 10 ft 4 100 400 Asai Hardware
Work bench 4×6 ft 2 12,000 24,000 Jacaranda Wooding ltd
Soldering Gun 13A/240V 3 120 360 Star Electronics ltd
Hacksaw 9” 2 1,500 3,000 Asai Hardware
Solder Sucker 13A/240V 1 2,500 2,500 Star Electronics ltd
Ladder Expandable 3 5,000 15,000 Asai Hardware
Hummer Ball Pen 3 180 540 Asai Hardware
Electric Drill 13A/240V 4 2,500 10,000 Asai Hardware
Spanner Size 10” , 13” 4 150 600 Asai Hardware
Safe belt 4 1,000 4,000 Asai Hardware
Steel Tape Diamond 4rolls 500 2,000 Asai Hardware
Clumping tool Diamond 5 2,000 10,000 Star Electronics ltd
Bending spring 20mm 10 424 4240 Devan tech
TOTAL 320,000.00
The organization will recruit distributors to deliver goods and services to the customers. In this way, the Company will bring its goods and service closer to the prospective customers and subdivide the whole operation area into units which will make the organization have control of the market area.
It will also enhance customer satisfaction by adopting price reduction and timely service rendering strategies
5.0.2 OPERATION STRATEGY
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WAN Communication will carry out market survey in order to understand the market on a wider perspective. The result from such survey will be used to implement the firm’s operation strategies. The organization will also give incentives to loyal customers in order to maintain customers as well as offer discounts to customers who purchase in bulk.
Intensive marketing techniques will also be enforced to widen the market and to market the venture further, all employees will have to wear uniforms with painted pocket shirt or blouses which bear the company name and logo.
5.0.3 THE OPERATION PROCESS
WAN Communication will deal in installation and repair of communication equipment as well as selling. He operation processes are illustrated in the flow charts below.
(A) INSTALLATION PROCEDURE (B) REPAIR PROCEDURE
5.0.4 REGULATION AFFECTING OPERATION
Costing
Trouble Shooting
Receiving faulty equipment
Actual Repair
Collection of Ready Equipment
Testing Repaired Equipment
Reassembly
Paying for services
Survey of the premises
Costing & Estimation
Supply of Material
Assessing the Work done
Actual Installation
Receive Payments
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These are laws and regulations that WAN Communication will adopt as whole while operating. The legal laws binding the business will be inter-twined to the organizations own rules for a profitable operation.
Such rules will be divided into two categories as:-
(A) External Rules
(i) Employment Act Cap 226
The organization will observe this Act by offering the stipulated salaries and wages as well as the employees’ rights.
(ii) Public Health Cap 260
The organization will observe standard health requirement in the premises and with the employees.
(iii) Trade License Act Cap 497
The organization will apply for the acquisition of this license from the Ministry of Trade and Industry.
(iv) National Social Security Fund Act Cap 258
The organization will register with the NSSF and forward monthly contributions of all employees to the fund.
(v) Income Act Cap 620
The organization will foresee the registration of its employees with the Kenya revenue Authority to curb incidences of tax default and also have the organization remit its own returns to the authority.
(B) Internal rules and Regulations
(i) All employees should report to work by 8:00 am and leave the premise by 5:00 pm.
(ii) All the employees working past the required time (past 5:00pm) must sign in with the security for security and financial consideration.
(iii) Employees must wear uniforms at all times during working hours.
(iv) Any act of theft will be dealt with in accordance with the laws of Kenya.
(v) All employees will be entitled to 25 days leave per year.
(vi) Lunch breaks will last for one hour and thirty minutes, from 12:30 pm to 2:00 pm.
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CHAPTER SIX
FINANCIAL PLAN
6.0.0 INTRODUCTION
This chapter focuses on matters pertaining to finance, expenditure and inputs. It represents financial estimations at the beginning and in future in quantitative terms. These details will then be used by the management of WAN Communications to assess the performance of the venture.
6.0.1 PRE-OPERATIONAL COST
Such will include all expenses incurred before the business commences and are summarized as:-
PRE-OPERATIONAL COST
ITEMS COST(KSHS)
Equipment & Tools 200,000.00
Stock/ Raw Materials 160,000.00
Licenses and permits 6,500.00
Advertisement of the grand opening 20,000.00
Insurance 10,000.00
Business Registration 3,000.00
Furniture & Fitting 120,000.00
Staff Uniform 10,000.00
Rent Deposit & Goodwill 38,000.00
Stationary 4,5000.00
Miscellaneous 2,800.00
TOTAL 574,800.00
6.0.2 ESTIMATION OF WORKING CAPITAL FOR THE YEAR 2011, 2012 & 2013
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DETAILS 1st YEAR (2011)
2nd YEAR (2012)
3rd YEAR (2013)
CURRENT ASSETS KSHS KSHS KSHS
Stock
Debtors
Cash At hand
Cash At Bank
160,000.00
30,000.00
102,000.00
306,000.00
299,750.00
20,000.00
99,500.00
520,000.00
402,300.00
23,000.00
96,000.00
735,500.00
TOTAL (A) 1,013,500.00 1,239,250.00 1,453,800.00
CURRENT LIABILITIES
Creditors
Bank Loan
-
660,000.00
15,000.00
264,000.00
19,000.00
-
TOTAL (B) 680,000.00 279,000.00 19,000.00
TOTAL WORKING CAPITAL 353,500.00 960,250.00 1,434,800.00
6.0.3 LOAN AND INTEREST REPAYMENT
The proposed business loan will be from Equity Bank of Kenya. The loan will be Ksh 660,000.00 which will be repaid at an interest of 16%. The loan will be paid for a period 30 months with agrace period of 2 months from the date of borrowing.
The borrowed amount will all be introduced into the business and the repayment schedule will be as per the table in the next page.
MONTH No.PRINCIPAL AMOUNT
MONTHLY INSTALMENT
INTEREST BALANCE
2 months grace period
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3 765,600.00 22,000.00 3,520.00 740,080.00
4 740,080.00 22,000.00 3,520.00 714,560.00
5 714,560.00 22,000.00 3,520.00 689,040.00
6 689,040.00 22,000.00 3,520.00 663,520.00
7 663,520.00 22,000.00 3,520.00 683,000.00
8 638,000.00 22,000.00 3,520.00 612,480.00
9 612,480.00 22,000.00 3,520.00 586,960.00
10 586,960.00 22,000.00 3,520.00 561,440.00
11 561,440.00 22,000.00 3,520.00 535,920.00
12 535,920.00 22,000.00 3,520.00 510,400.00
13 510,400.00 22,000.00 3,520.00 484,880.00
14 484,880.00 22,000.00 3,520.00 459,360.00
15 459,360.00 22,000.00 3,520.00 433,840.00
16 433,840.00 22,000.00 3,520.00 408,320.00
17 408,320.00 22,000.00 3,520.00 382,800.00
18 382,800.00 22,000.00 3,520.00 357,280.00
19 357,280.00 22,000.00 3,520.00 331,760.00
20 331,760.00 22,000.00 3,520.00 306,240.00
21 306,240.00 22,000.00 3,520.00 280,720.00
22 280,720.00 22,000.00 3,520.00 255,200.00
23 255,200.00 22,000.00 3,520.00 229,680.00
24 299,680.00 22,000.00 3,520.00 204,160.00
25 204,160.00 22,000.00 3,520.00 178,640.00
26 178,640.00 22,000.00 3,520.00 153,120.00
27 153,120.00 22,000.00 3,520.00 127,600.00
28 127,600.00 22,000.00 3,520.00 102,080.00
29 102,080.00 22,000.00 3,520.00 76,560.00
30 76,560.00 22,000.00 3,520.00 51,040.00
31 51,040.00 22,000.00 3,520.00 25,520.00
32 25,520.00 22,000.00 3,520.00 0
Balance = Principal Amount - (Interest +Monthly Installment)
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Principal Amount = Bank Loan + Interest
Monthly Installment =
Interest = 16% of the Borrowed amount
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6.0.4 (A) Projected Cash Flow for the year (2011)
DETAILS JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC TOTAL
This is an effective way of presenting the relationship between volume cost and profit. It also gives the relationship between the revenue and cost with respect to volume. It shows equilibrium level of sale at which revenue equals cost. This equilibrium point is also known as the break Even Point. At this point there is neither profit nor loss.
WAN COMMUNICATION LTD
BREAK EVEN POINT ANALYSIS
DETAILS SALES FIXED COST VARIEBLE COST
SALES 1,594,281.00 - -
EXPENSES - - -
Rent - 105,000.00 -
Insurance - 60,000.00 -
Salaries - 258,000.00
Electricity - - 7,850.00
Telephone - - 4,071.00
Water - - 5,986.00
Advertisement - - 56,000.00
Stationary - - 6,000.00
License - 6,500.00 -
Staff Uniform - 10,000.00 -
TOTAL 1,594,281.00 181,500.00 337,907.00
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(1) BEP = X 100
= X100
= 11.38%
(2) Total contributing margin = {Total Sales–Total Variable Cost}
= 1,594,281.00 – 337,907.00
= 1,256,374.00
(3) Contribution Margin % = X100
= X100
=78.80%
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6.0.8 PROFITIBILITY RATIOS
This is used to reflect the element to determine the proportionality status of the business rated against the established standards.
(A) For the year 2011
(i) Return On investment=
=
=1.585
(ii) Net Profit Margin =
=
=0.338
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(iii) Gross Profit =
=
=0.866
(iv) Asset Turn Over =
=
=0.761
(vi) Asset Turn over Ratio = X100
= X 100
=76.14%
(vi) Current Ration =
54
=
=0.860
(vii) Liquidity Ratio = X100
=
=6.71%
(viii) Inventory Turn Over =
=
=0.555
6.0.9 DESIRED FINANCING
This is the financing that will be required by the business before commencing. It is expressed as below:-
This refers to the source of business financing and is summarized as:-
Bank Loan 660,000.00
Equity Financing 340,000.00
Proposed capitalization 1,000,000.00
CONCLUSION
Market research leaves no doubt that WAN COMMUNICATION will be viable. The outline and research has revealed that the existing Telecommunication industry
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improvement in technology day by day, making it very vital for establishing of firms which will be sensitive to these change technoloogy as well as taste and perference. The business strategic location as well as entrepreneurial skills and managerial skills acquired by the proprietor will make the business successful. Any short comings which will be encountered during operation will be dealt with in the year to come besides the preventive measures taken upon them.
The business will have all merit to give it shinning future!
