TABLE OF CONTENTS
EXECUTIVE SUMMARY .................................................................................................................................. 4
CHAPTER ONE ............................................................................................................................................... 6
1.0. BUSINESS IDEA.................................................................................................................................. 6
1.1. Name of the business ........................................................................................................................ 6
1.2. Produce the following products ...................................................................................................... 6
1.3. Provide the following services .......................................................................................................... 6
1.4. The customers will be ...................................................................................................................... 6
1.5. The business will sell in the following way ..................................................................................... 7
1.6. The business will satisfy the following needs of the customers .................................................... 7
1.10. SWOT ANALYSIS .............................................................................................................................. 7
1.11. Strengths of the cosmetic enterprise ............................................................................................. 7
1.12. Weaknesses ..................................................................................................................................... 8
1.13. Opportunities. ................................................................................................................................ 8
1.14. Threats ............................................................................................................................................ 8
1.10. VISION, MISSION, GOALS, AND OBJECTIVES .................................................................................. 9
1.11. Vision statement ............................................................................................................................ 9
1.12. Mission statement.......................................................................................................................... 9
1.13. Goals ............................................................................................................................................... 9
1.14. Objectives ....................................................................................................................................... 9
1.10. BUSINESS STRATEGY .................................................................................................................... 10
1.11. Communication strategy .............................................................................................................. 10
1.12. Competitive strategy .................................................................................................................... 10
1.13. Marketing strategy ....................................................................................................................... 10
1.14. Human resource management strategy. ..................................................................................... 10
1.15. Supplier relationship strategy...................................................................................................... 11
CHAPTER TWO ............................................................................................................................................ 12
THE MARKETING PLAN ........................................................................................................................... 12
2.11 Market research ............................................................................................................................. 12
2.12. competitors ................................................................................................................................... 12
2.13 Assessment of competitor’s strengths and weaknesses .............................................................. 12
1
PRODUCT PLAN ...................................................................................................................................... 14
2.10. PRODUCT PLAN FORM .................................................................................................................. 15
2.20. PRICE .............................................................................................................................................. 16
2.21. PRODUCT PRICE FORM.................................................................................................................. 16
2.30. PLACE ............................................................................................................................................. 18
2.31. The marketing plan (place) form .................................................................................................. 18
2.30. PROMOTION .................................................................................................................................. 19
2.40. promotion section of this business plan (form) ........................................................................... 19
CHAPTER THREE .......................................................................................................................................... 21
3.10. FORM OF BUSINESS....................................................................................................................... 21
3.11. The form for business ................................................................................................................... 21
CHAPTER FOUR ........................................................................................................................................... 22
4.10. STAFF ............................................................................................................................................. 22
4.11. Staff form....................................................................................................................................... 22
CHAPTER FIVE ............................................................................................................................................. 24
5.10. LEGAL RESPONSIBILITIES AND INSURANCE. ................................................................................. 24
5.11. Legal responsibilities and insurance form .................................................................................... 24
CHAPTER SIX................................................................................................................................................ 26
6.10. PRODUCT COSTING ....................................................................................................................... 26
6.11. Calculate direct material ............................................................................................................... 26
6.11. Calculate indirect costs. ................................................................................................................ 29
CHAPTER SEVEN .......................................................................................................................................... 31
7.10. FINANCIAL PLANNING ................................................................................................................... 31
7.11. A SALES AND COSTS PLAN. ........................................................................................................... 31
7.11. CASH FLOW PLAN .......................................................................................................................... 32
CHAPTER EIGHT........................................................................................................................................... 33
8.10. REQUIRED STARTUP CAPITAL ....................................................................................................... 33
8.11. What capital investment do i need? ............................................................................................. 33
8.11. Decide on which equipment I need .............................................................................................. 34
8.12. What working capital do i need.................................................................................................... 34
8.13 Startup capital form ....................................................................................................................... 35
CHAPTER NINE ............................................................................................................................................ 36
2
9.10 TYPES AND SOURCES OF STARTUP CAPITAL ................................................................................. 36
9.10. Source of capital form ................................................................................................................... 36
3
EXECUTIVE SUMMARY
This plan is to set up a cosmetic shop in the name of " Briox Cosmetics Enterprise ", which will
be located in Easy View Arcade Garage street Mbarara. The cosmetic shop will be a sole
proprietorship owned by Akampurira Brian. I will use startup capital of 52,380,000 Uganda
shillings. UGX 34,380,000 will be owners’ equity and the remaining UGX 18,000,000 will be a
bank loan which will be secured from centenary bank at 10% interest rate.
The key personnel at the cosmetic Enterprise will include Senior manager, buying inputs and
overall supervisory work, operations and production staff, sales and marketing staff, skin therapy
and hairdressing staff, record keeping and accounting, stock control and direct selling staff
The key objective of the cosmetic shop will be to provide fresh quality cosmetics to our clients to
enable them improve their general skin beauty, to obtain maximum customer satisfaction through
continued quality production, to obtain continuous production and supply of our products to the
customers, to create customer loyalty to our products such that they become well pronounced in
the customer minds.
To achieve our objective, the cosmetic shop will employ strategies such as: Offering quality, body
skin lotions, oils and herbal cosmetics that help fight the skin diseases made from fresh fruit and
vegetable which are nutritious through adequate research and proper mixture of the lotions, oils
and herbal ointments to meet the standard skin contents and characteristics of customers in the
market through advertisement by use of sign posts, direct selling and radio stations, offering
special incentive to our regular clients, offering our cosmetics at relatively lower prices for market
penetration, creating a conducive environment for our clients, employing people who understand
the meaning of customer care and meaning of quality by giving them samples for use as a way of
expanding our markets especially among the young children, youth and women. All this
encompasses our strategies that include, communication strategy, supplier relationship strategy,
marketing strategy, competitive strategy and human resource strategy.
The vision of the cosmetic shop will be ‘To be the leading suppliers of quality, fresh and health
skin booting cosmetics product’
4
Our mission will be, dedicated at improving the skin health and body look and appearance of our
client. "We seek to become the recognized leader in our targeted local and international market for
carrying a diverse line of in demand cosmetics including perfumes, makeup, and other accessories
that will have a competitive edge towards customer satisfaction and retention at attractive prices.
Our major customers will be corporate employees, students, market vendors, tourists and retailers
who will be consuming a range of our products including; Perfumes 1st class, Lemon body lotion,
Hair relaxer cream, Avocadoes body cream smoother and Hair glow.
Our forms/ ways of distribution will include, through Retailers, distributors and wholesalers who
will buy and sell in bulk to our final customers which we cannot sell to directly we shall also sell
directly to the customers because we have a high customer traffic at our main outlet in Mbarara.
We shall as well be using a van that will be leased to distribute to our customers who order in large
quantities.
In terms of our legal responsibilities, the following taxes apply to our business, sales tax,
employees’ income tax, national social security fund and Mbarara Municipal Council Tax and
other licenses like trading license, and Uganda National Bureau of Standards license. We shall as
well need to the insurance for our business and also carry out other social responsibilities like
corporate social responsibility, being environmentally friendly, and ensuring cleanliness of
Mbarara town.
Our products are costed and priced after comparison with our major competitor’s prices and
costing information acquired through market research. We have as well carried out cash flow
estimates to ensure that our business does not run out of cash.
Our startup capital has been allocated to what we intend to start our business with that is renting
building for two months, buying machines for mixing the inputs, Machines, leasing van, buying
furniture and fittings, massage equipment, cloths and uniforms and other necessary things to start
with including the employee salaries for the first two months.
This plan will be effective on 1st January 2018 and that is when my business will begin in
Mbarara Easy View Arcade.
5
CHAPTER ONE
1.0. BUSINESS IDEA
1.1. Name of the business
Briox Cosmetics Enterprise
1.2. Produce the following products
Briox Cosmetics Enterprise will provide different kinds of cosmetic products ranging from body
lotion to hair relaxers with potentials of using local fruits, both rare and common fruits as key
primary ingredients in the production of body oils and lotions. This will be intended to improve
the general skin health as well as boosting the beauty skin of our clients especially ladies. Among
the fruits we will use to extract include grapes, Chew cumber, palm fruits, avocadoes, lemons,
oranges, among others to produce body lotions that moisturizes and smoothens the skin for healthy
attractive look of the boy and hair.
Our business will also provide moisturizing creams, body lotions, hair lotions of various types and
varieties to our esteemed customers.
Our product will be offered to the young, the youth and the old, who will need to improve their
general health and skin beauty.
1.3. Provide the following services
We will also offer the cosmetic products to our esteemed customers while providing consultancy
advise inform of skills for mixing and using the oils for their own benefit
We will provide free consultancy services about lotion use, making and maintenance and caring
for the skin especially mostly by the ladies and young girls who our major customers and advise
them on maintaining a healthy balanced diet which include fruits and vegetables.
1.4. The customers will be
Other businesses that deal in cosmetics, retail shops, supermarkets all over the country, in foreign
countries in East Africa like Kenya, Rwanda, Tanzania, and Burundi and other customers will be
buying from our company directly and from our mobile distributors and they will be both the
young children, men and mostly women.
6
1.5. The business will sell in the following way
Distribute to our national and international distribution centers, supermarkets, retail outlets, our
agents all over the countries in East African regions and some customers will buy directly from
our company main outlet in Mbarara.
1.6. The business will satisfy the following needs of the customers
Briox cosmetics will offer reliable cosmetics, lotions, and jerrys intended to improve the general
skin health as well as boosting the beauty skin of our clients especially ladies, skin treatment, cure
skin rashes, and ensure all time beauty of our clients.
1.10. SWOT ANALYSIS
The Cosmetics industry is one of the growing industry in the country with a number of industries
Unisex beauty cosmetics with many branches, and other small businesses which have joined the
industry. Despite the increase in the Cosmetics industries, customer’s demands are not fully met
due to the increasingly growing population and poor delivery of the cosmetics to the customers,
Briox cosmetics Enterprise is therefore aiming at filling this gap. The industry has shown a great
interest for investment. The industry has earned great reputation due to the increased differences
in customer requirements like skin colors, hair styles by different hair cosmetics and customer
general beauty.
1.11. Strengths of the cosmetic enterprise
 Availability of startup capital,
 Ability to make cosmetic products from local available fruits
 Strategic location in the Easy View Complex which has a high enough space.
 High level of customer care that we shall portray
 We shall operate on a daily basis 24 hours to meet our customer needs which will ensure
constant supply.
 We shall do skin therapy to our special customers based on appointments at an affordable
price which will gain fame amongst corporate women.
 High quality and exceptional packaging material which are environmental friendly that we
shall offer.
 Operating from the cleanest environment
 Offering free training and consultancy services to our customers.
7
1.12. Weaknesses
 Limited nature inputs like fruits and vegetables to our business.
 Low supply of skilled labour that will assist in mixing the right quantities for the inputs
 Low levels of knowledge about the cosmetic business
 Low capital inputs to start up with in establishing the plant and expanding the business
operations to other regions.
 Do not have enough record keeping mechanism.
 Inadequate experience in the market due to few months of operation than our competitors
 Few workers in company which delays production
1.13. Opportunities.
 Briox Cosmetics Enterprises is growing and new cosmetics dealers are setting up which will
increase the market base.

The competitors of Briox Cosmetics Enterprises do not know about the new emerging ideas in
the global markets like new product development techniques to suit customer demand.

The competitors of Briox Cosmetics Enterprises do not know how to efficiently manage their
supply chain and distribution channels like Unisex group of companies.

Financial boost from banks for service expansion and facility improvement.
1.14. Threats
 The customers are used to buying from already established cosmetic industries like Movit
and Samona who can easily adopt to rapidly changing techniques of production and global
competition which is hard to adopt to for us
 Constant changes in customer demands which impact on our level of satisfaction to our
customers and changing economic environment.
Evaluate my business idea
Number of strength………………………………………………09
Number of weaknesses………………………………………….07
Are there more strengths than weaknesses?
Yes
Number of opportunities………………………………………….03
8
No
Number of threats………………………………………………...02
Are there more opportunities than threats?
Yes
No
I therefore decide to continue with my business idea since there are more strength and
opportunities than the weaknesses and threats.
1.10. VISION, MISSION, GOALS, AND OBJECTIVES
1.11. Vision statement
The vision of the cosmetic shop will be ‘To be the leading suppliers of quality, fresh and health
skin booting cosmetics product’
1.12. Mission statement
It will be, dedicated at improving the skin health and body look and appearance of our client. "We
seek to become the recognized leader in our targeted local and international market for carrying a
diverse line of in demand cosmetics including perfumes, makeup, and other accessories that will
have a competitive edge towards customer satisfaction and retention at attractive prices.
1.13. Goals
 To be leading supplier of quality, fresh and health skin beautifying cosmetics
 To expand to the other markets across East Africa.
 To exploit opportunities in the market including the gaps left out by already established
firms like Movit and Samona.
1.14. Objectives
The Enterprise is dedicated to achieving maximum customer satisfaction at the lowest possible
cost and therefore has the following objectives.
 To obtain maximum customer satisfaction through continued quality production
 To obtain continuous production and supply of our products to the customers
 To create customer loyalty to our products such that they become well pronounced in the
customer minds.
 To efficiently publicize our products to create awareness among the customers
9
 To provide high quality products to the clients through use of quality and standard in puts
that is natural inputs.
 To use our experience to operate at lowest costs possible.
 To establish a strong and reputable relationship with the stakeholders of the Enterprise.
 To come up with new products in the Cosmetics industry.
1.10. BUSINESS STRATEGY
This will include the communication strategy, marketing strategy, supplier relationship strategy,
promotion strategy, Human resource management strategy and competitive strategy.
1.11. Communication strategy
One of the most important aspects of a successful launch is a positive publicity for our cosmetics
products. We will develop awareness campaigns to promote our product through several avenues.
Our management team will fiercely have pursued positive perception through societal endorsement
promoting the benefits of our product by actively seeking local news and media coverage to help
on awareness.
1.12. Competitive strategy
Position of the business in the heart of Mbarara and the whole of Uganda and also being near the
high market area makes the product easily accessible by our customers. An aggressive advertising
campaign will be undertaken so that we create much awareness of our product than our competitors
through our highly skilled management team and employees that will be highly in contact with our
customers.
1.13. Marketing strategy
Briox Cosmetics Enterprises plans to communicate through outdoor advertising and television
advertising to generate sales. This will be spearheaded by our marketing team to manage the
marketing campaign. The key message associated with our products is high quality beautifying
cosmetics and skin care.
1.14. Human resource management strategy.
Briox cosmetics Enterprises will start up with its experienced members in various fields that are
useful in the business to form competent team of trustworthy staff for efficiency and effective
10
operations and goal oriented. Provision of favorable working conditions to maintain a high
degree of personal development and satisfaction of both employees and employers and ensuring
that our employees are constantly trained where need arises.
1.15. Supplier relationship strategy.
Briox Cosmetics Enterprises will ensure a close working relationship with our suppliers and
where necessary undertake supplier development programmes that is providing improved
varieties of agricultural inputs for example grapes, Chew cumber, palm fruits, avocadoes and
lemons and tools that will ensure constant supply of our core inputs.
11
CHAPTER TWO
THE MARKETING PLAN
2.11 Market research
Briox Cosmetics Enterprise intends to maintain an extensive marketing campaign that will ensure
maximum visibility for the business in its targeted market. This will be achieved through market
research on our customers, competitors, competitor suppliers, their products and their pricing.
2.12. competitors
Our major competitors are KK shop, Dan cosmetics and Baby Face Organic that sell the same
cosmetics. Below is the analysis of our major competitors’ strength and weaknesses.
2.13 Assessment of competitor’s strengths and weaknesses
Competitors
Strengths
Weaknesses
name
KK shop cosmetic
dealers
Dan cosmetics

Extensive research

High prices for their products

Huge capital investment

High costs of operation

More experience in this business

Weak skills (leadership, interpersonal,

Customer loyalty

communication, teamwork)

Limited work experience.
Has many customers who buy in

Limited financial resources for startup.
bulk

Lack of own premises to capitalize the

High advertising rates

Strategic location

Limited marketing expertise.

Creative and innovative

Poor sanitation
concentrate all activities in one place.
management
Baby Face Organic

Low operating costs

Un reliable supply

Wide distributional channels

Un experienced staff

Dedicated, competent and

High Labor intensive operations
flexible work force

Limited product and service lines.

Un motivated staff
12

Emphasis is on high quality and
quantities
The results of the market research are summarized below.
I used the information gathered from the potential customers and came up with the following
information
MARKET RESEARCH
Needs and preference of
Product
Perfumes 1st class
Customers
Competitors
customers
Corporate employees they need unique scent that is
packed in luxurious containers
and can last long when used.
Low quality perfumes that
are not unique
Does not always have
Must be available in time and
knowledge of the latest
in recognizable supermarkets
products
and shopping malls
Inconsistent supply and so
shortages in the market
Lemon body lotion
Students
Wide range of differently
High prices and limited
colored and flavored lotions
varieties not consistently
offered at relatively low prices. supplied.
Different sizes and shapes.
Low quality and unattractive
colours and shapes.
13
Hair relaxer cream
Market vendors
Hair softeners with reliable
Unreliable supply and un
supply in all corners of the
defined distribution channels
country availed to all vendors
that affects constant supply.
in time.
Avocadoes body
Tourists
cream smoother
High quality products availed
Low quality lotions with less
in recognized shopping centers
moisturizing content
and malls
High level of skin moisturizing
and smoothening.
Hair glow
Retailers
Reliable supply at the right
Delays in supply and un
time and place in right
coordinated supply chain and
quantities.
distribution channels.
PRODUCT PLAN
We will specialize majorly in cosmetic products and manufacturing of locally made cosmetic
products to treat the skin illness such as fungal diseases using locally produced vegetables and
fruits as ingredients in the manufacture of these cosmetics
We will offer free consultancy services to our clients, free cold water, and warm water for washing
our hands. We will employ people who are easily accessible, customer oriented, efficient and
effective. We will provide customized services like skin therapy and hair dressing to our most
esteemed customers during the weekends when we are not very busy so as to meet their demands
and needs by being agile.
14
2.10. PRODUCT PLAN FORM
Products, services or range of products offered
Quality
Perfumes
Lemon
Hair
Avocadoes Hair
Skin
1st class
body
relaxer
body
Therapy and
lotion
cream
cream
customer
smoother
advise
High
Basic
Basic
glow
High
Basic
consultancy Hair
dressing
N/A
N/A
N/A
Green and N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
quality for quality to quality to quality for quality
Color
corporate
keep prices create
the tourists
customers
relatively
customer
and
low
loyalty
rich
Purple,
Yellow,
Green,
Green
blue,
blue, green yellow and
green,
and blown
blue
Large
Large
Large
Large
Large
600ml,
500ml,
600ml,
500ml,
600ml,
medium
medium
medium
medium
medium
450ml and
350ml and
450ml and
350ml and 450ml
small
small 50ml small
the
blue
orange
Size
150ml
Packaging
Smell
small 50ml and small
150ml
150ml
Metallic
Plastic
Plastic
Plastic
Plastic
containers
containers
containers
containers
containers
and tubes
and tubes
and tubes
and tubes
N/A
N/A
N/A
N/A
N/A
15
2.20. PRICE
The different sizes of our products will be charged different prices and my basis of pricing will
be based on the total costs incurred, competitors’ prices and how much my customers are willing
to pay.
I have studied the prices of Baby Face Organic who are my major competitor and I think that
selling at lower prices will be one of the most important ways of competing them. A low price is
important especially for students, market vendors and retailers.
I know that customers are willing to pay for my products in different sizes and shapes. I have
studied the costs of production, distribution and marketing for each product that is for Perfumes
1st class all sizes averagely UGX 4,500, Lemon body lotion all sizes averagely UGX 4,000, Hair
relaxer cream all sizes averagely UGX 3,500, Avocadoes body cream smoother all sizes
averagely UGX 45,00 and hair glow UGX 4,000. With these prices in mind, I will fill in the
price section of the business plan.
2.21. PRODUCT PRICE FORM
Products, services or range of products offered
Perfumes
Costs
How
1st Lemon body Hair
body Hair glow
class
lotion
cream
cream smoother
4,500
4,000
3,500
4,500
4,000
much 35,000-
lowest 10,000-lowest
9,000-lowest,
21,000-lowest,
10,000- lowest,
are 40000-
highest 12000-highest
10000-highest
25000-highest
12000-highest
customers
willing to pay
(corporate
employees
Price
relaxer Avocadoes
(students and (market
and low
income vendors
(tourists
and (retailors
and corporate employees)
tourists).
earners)
38000 (cooperate
9000(students) 10000(market
employees),
11000(low
vendors and
39000 (tourists)
income
retailers)
and
market vendors)
retailors)
earners)
16
25000(tourists)
20000(corporate
employees)
11000(market
vendors and
retailors)
Reason for setting Relatively
high Low price will Relatively low High
price will help us enable us get a price
this price
recover the costs wide
incurred
market ensure a high quality
income
is
in Relatively low
will relation to the high price will ensure
in from the low demand
production.
price
of
the a high demand
from products produced.
our
from
our
intermediaries
earners and the intermediaries
who can sale at a
students,
profit
who can sale at
a profit
Discounts will be No discount will No
given
to
the be given
discount vendors
will be given
retailers
and No discount will be vendors
and
that given
that
retailers
following
buy in large
buy
customers
quantities
quantities
Reason for giving N/A
N/A
Discount
discounts
Credit
will
given
to
be vendors
be given
large
Discount will be
be given to the
given
vendors
and
vendors
and
retailers
that
retailers
that
to
buy in large
buy
quantities
quantities
No credit will Vendors
the
will N/A
in
and Vendors and retailors
retailors
in
the
large
Vendors
retailors
following
customers
Reason for giving To
credit
increase N/A
To
vendor loyalty to
create
wider market.
our products
a To make vendors stop To
selling our competitor wider market.
products.
17
create
a
2.30. PLACE
Our location is in Mbarara, Easy View Arcade, Garage Street. The location is very good since
they a lot of hair dressers in this arcade hence full of women who potential customers for the
cosmetic products because they want to look good and. The place is chosen due to a boom of
commercial activities, an expected client base from students, tourists, corporate women
employees, and the large population is women as compared to men. The cosmetic shop will have
adequate lighting.
2.31. The marketing plan (place) form
Location.
we plan to rent a place in Mbarara, Easy View Arcade, Garage Street. It is located opposite Agip
Motel near bus park garage street.
The location is chosen because of the following reasons.
It is ideal because there is a high customer traffic
Enough packing space for the clients/ individual customers.
Clean environment and closeness to the main road that is Mbarara- Masaka road.
Method of distribution
Individuals
retailer
wholesalers
distributors
The ways of distribution are chosen because of the following reasons.
Retailers, distributors and wholesalers, will buy and sell in bulk to our final customers
which we cannot sell to directly
Individuals, will be used because we have a high customer traffic and so we shall sell to
them directly at our main outlet in Mbarara.
Distributors, will help to deliver our products to all our customers all over the country and
even outside countries in East Africa in the right time and place.
18
2.30. PROMOTION
We intend to invest heavily in advertisement of our products through the use of signposts, face
book, use of radios such as; Galaxy, Vision radio, which have a wider coverage. We also intend
to use a highly skilled marketing manager to market our products; for example; in Kampala town
universities, offices and other local areas around. We intend to also visit personally our general
stores and major wholesalers of our products and use other few methods of promotion.
The objectives of promotion are;
 To create awareness of our products to our customers
 To persuade the customers to prefer our products to those of our competitors
 Communicate to the potential customers about where our products can be found.
 Create a good initial image of our products in the society and our potential customers.
2.40. promotion section of this business plan (form)
Type of advertising
Details
Costs
A sign on the building
The sign will say “Briox Cosmetics
50,000 (fifty
Enterprises” showing the product that we
thousand shillings)
offer such that customers can know that there
is a cosmetics in the building
Personal letters
We will send personal letters to our vendors,
60,000 (sixty
wholesalers and selected retailors. We will
thousand shillings)
introduce the letter that “Briox Cosmetics
Enterprises”
Direct selling
We shall sell our product directly to our
customers and share with them information
about our products and why they should use
them.
19
No costs
Radio adverts
We shall run radio adverts on vision radio in
200,000 (two
Mbarara and Galaxy FM in Kampala that
hundred thousand
will help in persuading the customers and at
shillings)
the same time serve to inform them where
they can find our products
Free delivery
We shall deliver our products freely to our
N/A
wholesalers and retailers selected
Sponsoring public
These will be the ones where the target
The costs will
shows
customers will be converged in large numbers
depend on the type
for example music shows.
of show
We shall be giving free stickers to our daily
60,000 (sixty
customers containing the information about
thousand shillings)
Stickers
our products and where they can be found.
20
CHAPTER THREE
3.10. FORM OF BUSINESS
3.11. The form for business
The business will operate as;
 A Sole proprietorship
The reasons for choosing this business are;
 Low cost involved in starting the business
 Easy registration process of the business
 Simplicity in starting the business
 Increased level of control over the business
 Easy decision making in the business
 Easy taxation criteria that is business profits
The owner of the business will be
Name:
AKAMPURIRA BRIAN
Description of skills:
 Business manager and high selling skills
 Marketing skills and customer care skills
 Sales promotion skills
 Motivational skills
 Leadership and management skills
Relevant experience
 Experienced with mixing appropriate chemicals and natural fruits in making the
cosmetics and perfumes acquired from the three years working with Baby Face Organic.
 Experience in managing business that is a retail shop already owned in previous years.
 Experience in working with and through people (leadership) and motivational experience
to the employees.
21
CHAPTER FOUR
4.10. STAFF
I do not know much about running my own business but I plan to work hard and study to learn
all in need to know. According to my staff plan, I will be responsible for buying inputs and
assume the senior management role.
The business will be small so I will need more few employees to assist in some functions as
follows.
The operations staff will be responsible for manufacturing and mixing the inputs to produce the
cosmetics and all our products and will include three employees with the relative skills as will be
described and one of the three will assume the role of being a supervisor of production and
operations.
Sales and marketing. I will need one employee who will be responsible for marketing the
products and selling at our main out let in Mbarara to our direct customers and will be
responsible for customer service.
Two more employees responsible for offering additional services to our customers that is skin
therapy and hair dressing.
Two more family members will be employed and will assume the roles of stock control, and
selling to the market vendors, retailers and distributors and record keeping role respectively.
4.11. Staff form
Task
Required skills and experience
Performed by
Monthly pay
Senior manager, buying inputs
Business management and leadership
Akampurira
UGX 1000000
and overall supervisory work
skills.
Brian
Operations and production
Skills in mixing different inputs and
Three fulltime
Each UGX
staff
making perfumes and cosmetic products
employees
350000
Sales and marketing
Skills in customer care and marketing and
One fulltime
UGX 400000
sales
employee
22
Skin therapy and hairdressing
Skills in massage/ rubbing, and
Two fulltime
hairdressing and women
employees
Record keeping and
Skills in fundamentals of accounting and
One family
accounting
record keeping
member
Stock control, selling to market Skills in supply chain management and
One family
vendors, retailers and
member
personal selling skills
distributors
23
UGX 300000
UGX 350000
UGX 350000
CHAPTER FIVE
5.10. LEGAL RESPONSIBILITIES AND INSURANCE.
I have contacted a number of government agencies including, the regional tax office, Mbarara
Municipal council, Ministry of Labour and the National Environmental Authority and I have
found out the legal requirements that apply to my business. I have also contacted the insurance
company that is ICA insurance company to find out the costs of insurance for my business.
5.11. Legal responsibilities and insurance form
LEGAL RESPONSIBILITIES AND INSURANCE
The following taxes apply to the business
Sales tax
Employees income tax
National Social Security Fund (NSSF)
Mbarara Municipal Council Tax
The following regulations apply to the employees
Working hour
Sick leave
Employee insurance
The business will need the following licenses and permits
cost
Mbarara municipal council trading license worth …………………. UGX 100,000
Uganda National Bureau of Standards license worth………………. UGX 200,000
Shop license worth…………………………………………………...UGX 50,000
The business will have the following insurance
24
cost
Insurance for the stock and equipment……………………………. UGX 360000 per year
Medical insurance…………………………………………………...UGX 100,000 per year
Other responsibilities of the business
Corporate social responsibility
Environmental friendliness through proper waste disposal
Mbarara town cleanliness through reduced waste disposal
25
CHAPTER SIX
6.10. PRODUCT COSTING
6.11. Calculate direct material
These are the materials used in production that will become part of the final product. These
include the following. Grapes, Chew Cumber, Palm Fruits, Avocadoes, Lemons, Oranges, and
Others. These will be included in column one of my form
Column two will include the buying costs of one unit of each raw material, column three will
include the quantities needed for each of the raw materials, column four will include the cost per
item that is the multiplication of buying cost with quantity needed, and finally we shall get the
total direct material cost.
Product costing form for Briox cosmetics Enterprises
Products: cosmetics products
Raw materials
Buying costs
Quantity per item (kgs)
costs (UGX)
Grapes
30
5
150
Chew Cumber
20
4
80
Palm Fruits
30
3
90
Avocadoes
20
3
60
Lemons
30
2
60
Oranges
20
3
60
500
Total direct costs per item
Calculate Direct labour
Briox Cosmetics Enterprises will have nine employees, three of whom will be in production full
time, one in marketing, Mr. Akampurira Brian as the manager, an accountant, sales and
marketing assistant and stock control personnel.
26
I fill in the labour costs form and I use the information to calculate the direct labour costs for one
cosmetics item.
Labour costs form for Briox cosmetics Enterprises
Employee
Direct labour costs
Indirect labour costs
Hours not
Pay for time not
in
in production
Total
Total
Hours in
Pay for
working
monthly
production time in
hours
pay
per month
production production
per
per month
month
Brian manager
220
1,000,000
……….
……….
220
1,000,000
Operations staff (3
660
1,050,000
660
1,050,000
………..
……….
Sales and marketing
220
400,000
………..
………..
220
400,000
Skin therapy and
440
600,000
440
600,000
………..
………..
220
350,000
………
………..
220
350,000
220
350,000
………..
……….
220
350,000
1100
1,650,000
880
2,100,000
employees)
hairdressing(2
employees)
Record keeping and
accounting
Stock control, and
selling
Total
27
Direct labour cost per hour= total pay for time in production
total hours in production per month
=1,650,000/1100
Direct labour cost per hour
=1500 shillings per hour
Calculate direct labour costs per item
We estimate that it takes 5 minutes to make each bottle of lemon body lotion or Hair relaxer
cream or Avocadoes body cream smoother or Hair glow.

Our production personnel know that it takes 5 minutes to make a bottle of the cosmetic
product which is 0.083 hours

The direct labour cost per hour is 1500 shillings
Therefore, by multiplying 0.083hours and 1500 shillings, I calculate that the direct labour costs
for one bottle of cosmetics is 124.5 shillings. This is how I fill in the product costing form.
Direct labour costs per item
Activity
Time per item in minutes
Mixing the materials
2min
Preparing for making the product
3min
Making the product (putting the materials 1min
in the machines)
Total minutes
5min or
0.083
hours
*
1500 124.5
Direct labour cost per item
28
6.11. Calculate indirect costs.
Indirect costs are the other costs that I have for running my business. They are summarized
below in the indirect costs form
Indirect costs form for Briox cosmetics Enterprises
Indirect costs per month
Cost (UGX)
Electricity and water
200,000
Rent
300,000
Insurance
30,000
Interest on loan
150,000
Indirect labour
2,100,000
Miscellaneous
200,000
Depreciation
40,000
Distribution and marketing costs
300,000
Advertising and sales promotion costs
200,000
Total indirect costs
3,520,000
Note
1. Insurance costs per month= 360,000/12 months
=UGX 30,000 per month
2. Interest on loan= 10%*18,000,000
=1,800,000/12
=UGX 150,000
29
3. Depreciation
I will buy machinery worth 4,800,000 shillings, and I expect to use the machinery for 10 years.
Depreciation per year will be= 4,800,000/10years
=480,000 shillings
Therefore, depreciation cost per month will be= 480,000/12 months
=40,000 shillings
Calculate the indirect costs per item.
Indirect costs per item=total indirect costs per month (from indirect cost form)
Total hours in production per month (from labour costs form)
= 3,520,000
1100 hours
Indirect costs per item =3,200 shillings
Calculate total costs per item
Total cost per item= direct material +direct labour + indirect costs. It is shown in the form below.
Total cost form
Type of cost
Amount (cost per item)
Direct material
500
Direct labour
124.5
Indirect costs
3200
Total cost per item
3,824.5 shillings
30
CHAPTER SEVEN
7.10. FINANCIAL PLANNING
We shall follow the following steps to plan and monitor the financial situation of Briox
cosmetics enterprise.
1. We Make a sales and costs plan
2. We make a cash flow plan
3. Compare records with both plans every month
4. And we shall take action if anything goes wrong
7.11. A SALES AND COSTS PLAN.
A costs and sales plan shows the sales, costs and profits my business is likely to have each month
and it is made annually.
I have forecasted my sales and costs for the first year in business and I have been helped by my
productions team to develop the forecasts.
Sales and costs plan
2018 (00)
Details
Jan
Feb
Mar
Apr.
May
June
July
Aug
Sept
Oct
Nov
Dec
Total
Sales
2000
2500
4000
4000
7000
10000 10000 10000 10000 15000 20000 20000 114,500
Direct
1000
1500
2000
2000
3000
4200
4200
4200
4200
4800
5000
5000
36,900
2000
2000
2000
2000
2000
2000
2000
2000
2000
2000
2000
2000
24,000
0
2000
3800
3800
3800
3800
8200
13000 13000 49,400
material
costs
Direct
labour
costs
Gross
(1000) (1000) 0
profit
31
Indirect
2500
1500
1500
1500
1500
1500
1500
1500
1500
1500
1500
1500
2300
2300
2300
2300
6700
11500 11500 30,400
19,000
cost
Net
(3500) (2500) (1500) (1500) 500
profit
7.11. CASH FLOW PLAN
To make sure that I do not run out of cash, when I start up by cosmetics enterprise, I make a cash
flow plan for the first 12 months and below is a sample for the first seven months.
CASH FLOW PLAN (000)
Jan
Feb
Cash at the start of the month
7300
23700 19700
Cash in from sales
2000
2500
Any other cash in
7000
5000
Total cash in
16300
31200 23700
16400 18100
17800 35000 36500
Cash out for direct material costs
1000
1500
2000
2000
3000
4200
4200
4200
Cash out for direct labour costs
2000
2000
2000
2000
2000
2000
2000
2000
Cash out for indirect costs
2500
1500
1500
1500
1500
1500
1500
1500
Cash out for planned investment in equip
8000
……
……
……
……
……
……
……
Loan repayment
……
……
150
150
150
150
150
150
Any other cash out
200
……
……
……
……
……
……
……
Total cash out
13700
5000
5650
5650
6650
7850
7850
7850
Cash at the end of the month
2600
26200 18050
9950
27150 28650
32
March April
may
June
July
12400 11100
7800
25000 26500
4000
4000
7000
10000 10000 10000
……
……
……..
…….
10750 11450
…….
Aug.
……..
CHAPTER EIGHT
8.10. REQUIRED STARTUP CAPITAL
This chapter will include the investments that I need which include equipment, Business
premises, and the working capital that I need which will cover stock of raw materials and
finished goods, promotion, wages, rent, insurance and other costs.
8.11. What capital investment do i need?
The capital investment that I will need will be business premises and the equipment. The
business premises will be rented so there is no need to invest in that. The whole floor on Easy
View complex will be rented and rent for the first two months will be paid in cash.
Decide which premises I need for my business
I will
Construct my own premises
buy premises
rent premises
work at home
Because
 Renting premises needs less capital investment than buying and building premises.
 It is more flexible because it enables me change location in case of unfavorable factors
 Saves time spent in looking for the best location to construct my premises.
33
8.11. Decide on which equipment I need
I will require machines for mixing inputs, one van, office furniture, and fittings
Equipment
How to obtain it
Cost (UGX)
Machines
Buy
8,000,000
Van
Lease (2 years)
5,000,000
Office furniture
Buy
1,500,000
Fittings
Buy
1,200,000
Total
15,700,000
8.12. What working capital do i need
I will need working capital that will be used in paying for the expenses that I incur even before I
start production. This working capital will be required to cover for the first two months since
after two months I expect to have started having some reasonable sales.
The working capital will cover;
 Stock of raw materials
 Promotion
 Wages= monthly cost for wages × number of months before sales cover my costs
 Rent= monthly rent × number of months before sales cover my costs
 Leases
 Insurance
 Other costs= other cost per month × number of months before sales cover my costs
34
I worked so hard to estimate how much startup capital I will need to start up Briox Cosmetics
Enterprises. I have reviewed every amount in my business plan after talking to suppliers,
landlords, and they think that it will take two months before sales fully cover the payments for
costs. This is the estimates of how much startup capital I will need.
8.13 Startup capital form
Required startup capital
Investments

Business premises
Renting of the building/floor………………………………...1,200,000

Equipment
Machines
Buy…………………...8,000,000
Van
Lease (2 years) ………5,000,000
Office furniture
Buy…………………...1500,000
Fittings
Buy…………………...1,200,000
Massage equip
Buy …………………...1,500,000
Driers
Buy……………………1,600,000
Cloths and uniform
Buy……………………2,000,000
Total equipment startup capital…………………………. 20,800,000

Working capital
Stock of raw material……………………. 15,000,000
Promotion…………………………………1,000,000
Wages……………………………………. 7,500,000
Rent………………………………………. 600,000
Leasing……………………………………2,200,000
Insurance…………………………………. 80,000
Other costs………………………………...4,000,000
Total working capital………………………………………. 30,380,000
Total startup capital………………………………………….52,380,000
35
CHAPTER NINE
9.10 TYPES AND SOURCES OF STARTUP CAPITAL
Briox Cosmetics Enterprise will require an initial capital of 52,380,000 million shillings of which
34,380,000 shilling will be owners' equity and the remaining 18,000,000 will be a bank loan to be
secured from centenary bank payable at a rate of 10% per years. This money will cater for rent,
purchase of cosmetics purchase from the suppliers, employees, design and packaging of the
cosmetics products, purchase and mixture of cosmetics products such as hair glow, relaxers, and
herbal cosmetic research, shelves. Chair, bottles, tables and others.
9.10. Source of capital form
source of startup capital
required startup capital……………………………52,380,000
source of startup capital
owner’s equity………………………………………34,380,000
bank loan……………………………………………. 18,000,000
total …………………………………………………. 52,380,000
collateral
 personal guarantee by Akampurira Brian
 machine
36