CHAPTER ONE
EXECUTIVE SUMMARY
1.1 BUSINESS DESCRIPTION
The proposed business will be known as Double N Poultry farm. It will be located
at Embu district Kumbukumbu road. The business will be a sole proprietor form of
ownership owned by Mercy who will register the name with registrar of companies’ act
of Kenya. The business will have postal address for communication purposes. Its aim is
to create job employment and provision of high quality products to residents of Embu
town.
1.2 MARKETING PLAN
The target group of Double N farm will be categorized of Hotels, Restaurants,
Institutions, Supermarkets, retailers, Butcheries and households. The farm will use both
marketing skimming and marketing penetration as the pricing strategies. Promotion will
be done through posters, sales person, business cards, satisfied customers, billboards,
public relation and after sale services. Branding will be done once every year in
November. The products will be distributed either directly from the farm, indirectly or
through tendering or winning a contract.
1.3 ORGANISATION AND MANAGEMENT PLAN
Double N farm will develop a competent and efficient organizational structure. The
management structure to be adopted is known as Apex or Line. Top management will
consist of the owner who is the manager and the lower level consists of assistant
manager. The span of control has been limited to five workers. The farm will collaborate
with Jimco and company advocates, Blinks security firm, Equity bank, Gatumo and
associates and Direct line insurance company.
1.4 PRODUCTION AND OPERATION PLAN
Double N farm has to add more equipment such as chicken pens, stores, site office and a
room for the watchman. Installation of incubator and freezer will also be included and
concrete floors made. Waterer's, feeding troughs and display tables have to be purchased.
1
• FINANCIAL PLAN
Double N poultry farm will be financed by the owner, friends and relatives who will
contribute kshs 880,000 and the rest consisting of kshs 1,320,000 will be solicited from
Equity bank. Total pre-operational cost consist of kshs 1,000,000 and break even point
consist of kshs 23,704
2
CHAPTER TWO
BUSINESS DESCRIPTION
2.1 BUSINESS BACKGROUND
The owner desire to venture into a business that will be dealing with poultry products.
The business will be a sole proprietor owned by Mercy who will be the overall head of
the business. The owner has chosen this business in order to supply quality, affordable,
fresh and delicious poultry products to the resident of Embu town which they don't get
from my competitors. She has also gained valuable skills of operating the business from
entrepreneurship training taught as a course unit while pursuing a diploma course in
Business Administration who at Mount Kenya University. The owner also has working
experience as a supervisor at Embu poultry farm for three years.
• BUSINESS NAME
The proposed business will be known as DOUBLE N POULTRY FARM. The
name is obtained from the sponsor two names of the three MERCY NJOKI NJERU. The
farm has got postal address for purpose of communication with it suppliers, customers,
staff and others.
DOUBLE N POULTRY FARM
PO BOX 103
EMBU.
TEL (068)53647, 0726174707.
2.3 BUSINESS LOCATION
Double N Poultry farm is to be situated Kumbukumbu road that cuts across the
central business district aspect of Embu town. The farm will be about 5 km East of Embu
town center and 2 km near Embu police station. The site will be near round about which
connects the main road serving Embu-Mbeere, Embu-Meru and Embu-Nairobi roads.
The place seem to be suitable for the business because population has increased and is
continuing to increase rapidly due to many business people opening their branches in this
town and also due to rural-urban migration in search for job. The place also has enough
security since it is located near police station. There is also good transport and
communication network making it easier to transport the products. The business will
3
operate on two on two leased outlet in town center at a rent of ksh 16,000 per month. One
outlet will be located at the junction of Kenyatta Avenue Mama Ngina Street off EmbuKirinyaga road, Thagamo building ground floor at monthly rent of ksh 10,000. The other
one will be located at Blue valley road, Hussein building ground floor at monthly rent of
ksh 6,000. The Thagamo outlet will be used to promote the image and brand recognition
of Double N farm since it is located on the most active street. The walls of both outlets
will be painted with soft colours to relax the tired customers who might be purchasing at
the end of the day on their way home.
• FORM OF OWNERSHIP
Double N poultry farm will be a sole proprietor form of business. This form of
ownership is to be adopted in order to achieve efficient operation systems. Its easy to
register, the owner enjoys the profit alone , decision making is easier and also the owner
will be in direct control of the business.
TYPE OF THE BUSINESS
Double N poultry farm will operate both as a wholesale and a retail farm. It will
involve sale of poultry products such as hatching of chicks, raising of broilers and layers,
processing of production of eggs, chicken droppings and feathers.
The reason for choosing this kind of business is that demand for poultry materials in
this region is very high.
PRODUCT AND SERVICE
Double N poultry farm will deal with six products. These are;
chicks
chicken meat
eggs
chicken droppings
feather
manure
Chicks can either be broilers or layers, chicken meat will either be sold in parts or
as whole and eggs are of two categories. These are;
- Table eggs which are either white or brown.
- Hatchable eggs for chick production.
FIFO (first in first out) will be used as stock control method.
4
THE INDUSTRY
The proposed business falls under agricultural industry. The industry has existed
for a long period of time growing rapidly and has captured many part of country. Its
diversification is enhanced by high demand of its products and its simplicity as a
business to take. The proprietor will use her skills to make sure that the business has
succeeded although there are a number of direct competitors. She intends to capitalise
the weakness of small scale producers in that they cannot keep long term contacts
BUSINESS GOALS.
SHORT TERMS GOALS.
Double N farm will aims to achieve maximum production to increase production and
sales by 20%
and 40% in the second and third year respectivery.It also aims to produce affordable
products to its customers, creating more jobs opportunities, maximizing profit and
laving at providing high quality product.
LONG TERM GOALS
Double N farm is aiming to increase it reach beyond Embu town to other towns centers
within Embu District like Runyenjes, Kianjokoma, Manyatta and then to the rest of
country. The owner also aims to be a leading business woman in Embu town and
country wide.
JUSTIFICATION OF THE BUSINESS
It was notified that the already existing businesses are not offering quality service to
their customers This shows that my competitors do not follow food business ethics and
this is an opportunity to my business because with the current industrialized world
technology is changing everyday. Double N poultry farm has the ability to thrive in this
area due to the following strategy, the owner has adequate entrepreneurial skills which
she obtained from management while under taking Diploma in business
administration and also knowledge obtain while working in Embu poultry farm. These
skills will be supplemented by attending short term training in poultry farming at Kenya
Agricultural Research Institute Embu.
5
The proprietor also has adequate financial support from bank loan personal savings and
contribution from friends and relatives as stated earlier and this shows that he has
enough capital to start the business. The premises will also be easily accessible due to
efficient and well structured transport and communication net work. The farm will create
job opportunities to the resident of Embu town and offer them quality products at
affordable prices.
ENTRY AND GROWTH
Double N poultry farm is to register the business with the register of societies and
at the same time apply for a trading license at Embu county council. The business will
enter into the market by issuing print business cards that depicts the business logo and
products provided. Enough capital will also ensure that the targeted strategies are met
from the initial stage. Public relation will also be carried out to advertise the market
vigorously for the first six months.Billboards is to be located strategically in convinient
sport to attract customers. Sales promotion will also be carried out for the first
three months by offering after sale services and free samples.
For growth, the owner will increase machines a will be and employ qualified
workers. Products will also be diversified to meet customer’s demands in all levels. The
farm will expand by setting up units at Embu venturing to other places. The owner will
also invest on employees by giving them loans to be paid with an interest. A variety of
products will be offered and steady supply of products will be ensured.
6
CHAPTER THREE
MARKETING PLAN
CUSTOMERS
The target market of Double N farm will be categorized of hotels, restaurants,
institutions, supermarkets , retailers, butcheries, households and others. It is estimated
that the potential market will consume 73,792 units of Double N farm products per
year. These units can be chicks, whole chicken meat, tray of eggs, bags of manure and a
bag of feathers. Hotels are mainly located along busy street to cater for those who work
in government offices, passengers and locals thus ordering in large quantities and pay 30
days.
Supermarkets in town will buy products in large quantities and do not have a
uniform payment period policy. There are about 200 butcheries serving the population
that does not frequent supermarket thus ordering in large quantities. There mode of
payment is open to negotiation. Household are mainly reached by direct sales strategy
and comprise of housewives, maids and servant who buy in small quantities.
Institutions mainly comprises of schools, colleges, hospitals, polytechnics and
some companies. They order in large quantities and pay after 30 days.
Factors influencing customers to buy from Double N poultry farm include;
• PRODUCT QUALITY
The farm will be providing high quality products to their customers which they don’t get
from my competitors.
• PRICE
Double N poultry farm will offer products at affordable prices considering both the
high and low income earners.
• PACKAGING OF GOODS
The packing of goods will be of high standard where attractive trays will be
used.
4 .AVAILIBILITY OF PRODUCTS
There will be different kind of product offered by double N poultry farm which
competitors don’t offer.
7
5 CREDIT FACILITIES AND AFTER SALE SERVICE
Will be be offered to customer
COMPETITORS.
Direct competition is expected from four major existing businesses.
The four are;kenchick Ltd with its farm in Nairobi and two outlet in Embu town, Poulpro
supplies with a farm in meru and trhee outlets in Embu town, farm traders with a farm
at Ruiru and two outlets in Embu town and Embu poultry farm situated in Embu town
without any owned outlet but with the widest product mix that compares to that of
Double N products and so far the most serious competition.
These competitors don’t offer a variety of products to their customers , they don’t offer
after sale service neither give credit facilities to their customers , they also have
irregular opening hours as compared to Double N poultry farm who open from Monday
to Sunday.
Double N farm will capitalize on these weaknesses and overcome their strength.
COMPETITORS ANALYSIS
Customer name Competitors Location Service/ Product
Kenchick Limited P.O BOX 23 KITUI
Point of difference
-Chick
-Broilers
-Manure
-Eggs High prices
-No credit
Poulpro suppliers P.O BOX 105 THIKA Chick
Broilers
Eggs Delay in opening hours
low quality products
few products
Farm traders P.O BOX 77 RUIRU Manure
chicks
Eggs
Broilers Poor packages
No credit facilities
Double N farm P.O BOX 103 EMBU Eggs
Manure
Layers
Broilers
8
Feathers Affordable prices
free samples
variety of products
Credit facilities
quality and attractive packaging
PRICING STRATEGY
Double N will use both market skimming and penstruction strategy. In market
skimming, the farm will set high initial prices in order to gain more profits as quickly as
possible while in penetration, the farm will set very low price so that it can build market
share quickly and attract more customers. To determine the price of some products the
following factors will be considered; cost of production, overheads and competitors
price. High quality products will cost more compared to low quality products.
SALES TACTICS.
Double N farms will use both direct and indirect sales. Some customers will be served
directly from the counter and others through use of sales men. The sales men will be
able to use personal persuasive effort through approaching customer and presenting
products. Credit policy will only be applied to potential customers who will be in a
position to pay as they promise. Cash discounts and after sale service will be given for
the first three months.
ADVERTISING AND PROMOTION
The aim of advertising is to increase customer’s awareness of the existence of
Double N Poultry farm to all customers in Embu town and its adjacent areas. Promotion
will be done through posters, sales persons, business cards, satisfied customers, mix of
promotional activities including exhibitions, use of mass media and public relation.
A bill board is to be positioned at the junction of Nairobi- Embu- Mbeere- Meru
junction to alert customers from Nairobi, Embu, Mbeere and Meru. Its also gives the
direction of where the farm will be located. It will display the business name, logo and
mission statement. A number of products to be manufactured and services offered will
appear at the lower end of the billboard usually in small letters. The initial cost of the
stickers and bill boards are not to exceed shs 5000.
A systematic survey will be done periodically to ensure effectiveness of the
advertisement. The farmer will spend shs 65,000 on advertisement.
9
DISTRIBUTION STRATEGY.
Some customers like institution have a different way of acquiring their supplies
which includes tendering and winning a contract. Such customers will be served directly
from the farm. Salesmen will also move eggs on tray from one shop to another and
taking orders.
The cost per month will differ from January to December. January will be ksh
4,000, February 1,000, March 1,200, April 1,840, May 1,400, June 2,800, July 2,450,
August 4,000, September 4,000, October 2,600, November 3,000 and December 4,000.
The anticipated distributions are bushes and pot holes on the road leading to the farm.
The farm will clear those bushes and fill the potholes. The total transport cost will be
kshs 32,290 per year.
MARKETING SHARE
Double N farm targets 6.8% of the market share as per the total share. Although
poultry demand is rapidly increasing due to rural urban migration, ones market share
depends on issues like customers reach and relations, product quality and variety. The
farm market share is projected at 2.9% for chicken meat, 13.4% for eggs, 10.5% for
chicks, 29% for feathers and 2% for chicken droppings.
The size of the market is expected to rise by 40% of the total market share in the
next three years. The production is to increase by 25 % in year two and 40% in year
three. Given the difference in demand between Double N farm and the market leaders
which averages four times. There is alot of potential in winning away competitors
customer and venturing into new markets and new products. The market for my
competitors would be the first to be attacked given that they are not organized and can
therefore not respond as one force to any threat to their market share.
10
CHAPTER FOUR
ORGANISATION AND MANAGEMENT PLAN.
ORGANISATION STRUCTURES
Double N poultry farm will adopt a management structure know as line
stucture.Its hierarchical with two levels. Top management will consist of the owner who
is the manager and the lower management will consist of assistant manager. The farm
will choose this kind of structure because official work is done effectively; quality of
work done is high because of close supervision and high productivity.
MANAGER
ASSISTANT MANAGER
STOCK MAN
SALES MAN
ACCOUNT CLERK
WATCHMAN
OUTLET ATTENDANT
The chain of command is clear where everybody knows who he/ she is
answerable to. The span of control will be limited to almost five to allow closer
supervision. Authority flows downwards while responsibility flows upwards the
hierarchy.
11
12