Table of Content
Title Page
Executive Summary ------------------------------------------------------------
The Business --------------------------------------------------------------------
Funding Requirement -----------------------------------------------------------
The Plan --------------------------------------------------------------------------
Marketing plan -----------------------------------------------------------
Operational plan ---------------------------------------------------------
Pricing strategy -----------------------------------------------
Promotion strategy -------------------------------------------
Organizational plan -----------------------------------------------------
Financial plan ------------------------------------------------------------
Projected sales -------------------------------------------------
Projected income & expenditure ----------------------------
Projected break-even point ----------------------------------
Profit & loss statement ---------------------------------------
Projected balance sheet --------------------------------------
Projected cash flow ------------------------------------------
Projected funds flow -----------------------------------------
Projected ratio ------------------------------------------------
Critical risk -------------------------------------------------------------------
Exit strategy ------------------------------------------------------------------
Appendix ----------------------------------------------------------------------
EXECUTIVE SUMMARY
As we all know Ethiopia is a home of diverse ethnic ad culture. Its culture include clothes,
dishes, and other ways of live. Tela is one of cultural beverage used from ancient time. Many
young and adult use Tela widely which made in traditional way. This way has not moderate
starting from its production process. The quality of the production is one of the problem. And it
is not known all over the world.
Habesha tela is a small-scale corporate business that is located Adiss Ababa around Bole
relatively who solve the problem regarding to Tela. This is a relatively new business in its start-
up phase having been incorporated recently. We are on the brink of penetrating a profitable
market in a rapidly growing economy.
The product will be of extremely high quality to ensure customer satisfaction. Our primary
goal will be to establish and strengthen our license to trade, which will be bestowed by the
communities in which we function. As Habesha Tela prospers and grows, these communities
will continue to benefit from the value created by our group.
Initial plans are to produce two main lines of products primarily focusing on Defedefe Tela
and finished packed Tela (which comes in different form and size). These products will be sold
in different form and sized containers ranging from the 100 ml packed Tela and Defedefe Tela in
kg. These products shall be extensively distributed to different areas in Ethiopia, yet extremely
viable areas where the market is appreciative of readily available, with good quality.
Our target markets will primarily constitute the corporate and working class who appreciate
good quality traditional drink. The working class will range from the miners, who constitute a
large portion of the market, to administrative personnel.
THE BUSINESS
Habesha tela is a company for selling of the traditional Alcoholic drink called Tela. The aim
is to get the chance to acknowledge our Countries tradition and also benefit or maximize
Customer satisfaction & profit.
Our company location is at Bole (since it is a place where both Ethiopians and Foreigners
come every once in a while). It's because to attract foreigners in to buying the product in which it
will gain us foreign Currency which is very much need in our country. Furthermore we want to
export the product in the near future.
FUNDING REQUIRNMENT
Total start-up capital and expenses (stationery) came to approximately birr 100. Start-up
assets required and utilized included fermentation materials, office, shop and other office
equipment. This figure comes to $79,540.
Table: Funding
requirements
[Link] Qt 1Unit Variable
Description Unit fxed cost total cost
. y price Cost
3,000.0
1 rent Qty. 3 9,000.00 0.00 9,000.00
0
5,000.0
2 Office furniture Month 1 5,000.00 0.00 5,000.00
0
3 Stationery Month 1 100.00 0.00 100.00 100.00
gesho (Rhamnus quinta
4 4 360.00 0.00 1,440.00 1,440.00
prinoides) l
1,000.0
5 License fee month 1 1,000.00 0.00 1,000.00
0
quinta
6 4 800.00 0.00 3,200.00 3,200.00
barley l
quinta
7 wheat 1 800 0.00 800.00 800.00
l
Water, light, telephone 3,000.0
8 Month 1 0.00 3,000.00 3,000.00
fee 0
quinta
9 maize 4 600.00 0.00 2,400.00 2,400.00
l
10 Salary & Penssion Month 5 1,500 7,500.00 0.00 7,500.00
36,000.0 36,000.0
11 refrigerator Qty. 3 12,000 0.00
0 0
12 equipment jar Month 10 500.00 5,000.00 0.00 5,000.00
13 clean material 1 100.00 0.00 100.00 100.00
3,000.0
14 Promotion expense Month 1 0.00 3,000.00 3,000.00
0
1,000.0
15 fuel transport Month 1 0.00 1,000.00 1,000.00
0
1,000.0
16 Cloth exp. Month 1 1,000.00 0.00 1,000.00
0
64,500.0 15,040.0 79,540.0
Total
0 0 0
THE PLAN
Marketing Plan
Having undertaken a thorough and comprehensive research of the market, we realized
that there was a need for a manufacturer that focuses on producing affordable thirst-quenching
tela tailored to satisfying client's needs. We believe that there is a market need for one that
particularly focuses on the low to medium earning individuals. We intend to implement a niche
marketing strategy focusing on certain target markets.
Our marketing strategy will be based mainly on making the right product available to the right
target customer. We will ensure that our products prices take into consideration peoples budgets
and that these people appreciate the product and know that it exists, including where to find it.
operational plan
One core element of our operational plan will be that of differentiation In terms of
promotion, we intend to sell our company as a differentiated strategically, not just our products.
In price, we intend to offer extremely reasonable prices we need to be able to sustain that.
Market penetration through lower prices shall be undertaken where need be, while premium
pricing will be the case of the upper-end of the market.
Service Provision.
We intend our customer service to be key to the retention of customers. We shall follow-up
with our clients on a regular basis to ensure they are satisfied with our products and delivery
times. This is mainly because we intend our customers not to be one-time buyers but regular
order seekers.
Pricing Strategy
Initially our prices will not be under our control but dictated by the market conditions
prevailing at the particular time. We intend the price will accommodate the mark ups prevailing
in the industry, as well as our own costs. We intend to offer discounts to customers making bulk
orders. This will also assist in the establishment of customer loyalty.
Promotion Strategy
Our promotion strategy will be based primarily on informing potential customers of our
existence and making the right information available to our target customer. We intend to
undertake extensive advertising of our products in addition to our brand name--company name.
This is to instill awareness and knowledge of our existence in the market place.
organizational plan
Alemeshet Tela is committed towards an open governance system whereby its activities are
managed and undertaken ethically &transparently
This shall be undertaken through implementation of the following company values:
We intend to conduct our business ethically and transparently, respecting all applicable laws.
We intend to be a responsible corporate citizen fulfilling our obligations as an integral member
of society. Hence, our business decisions shall give appropriate weight and consideration to
social and environmental impacts.
We intend to provide products of uncompromising quality to meet the needs of our customers.
We intend to seek mutually beneficial and enduring relationships in all the commitments that we
make, ensuring that they are straightforward and honest. Hence, our communication shall be
open and accurate, internally and externally.
Ultimately, we intend to uphold all the above company values, promoting our employees and
respective third parties engaged by us to do likewise.
Through promotion and implementation of the above stated company values we believe that we
will be able to attain our corporate goals and objectives for the benefit of all concerned, in
particular the communities in which we will operate.
financial plan
We want to finance growth mainly through cash flow and equity. We recognize that this
means we will have to grow more slowly than we might like.
We need to develop a permanent system of receivables financing systems, using a well-
coordinated accounting department. In turn, we intend to ensure that our investors are compatible
with our growth plan, management style and vision.
Compatibility in this regard means:
Fundamental respect for giving our customers value, and for maintaining a healthy and congenial
workplace.
Respect for realistic forecasts, and conservative cash flow and financial management.
Cash flow as first priority, growth second, profits third.
Willingness to follow the company and contribute valuable input to strategy and implementation
decisions.
projected sales
projected income and expenditure
Description Qty Price/1unit Month Total
Rent 3000 12 36000
Gesho 4 360 12 17280
Barley 4 800 12 38400
Wheat 1 800 12 9600
Water,light,telephone 3000 12 36000
fee
Maize 4 600 12 28800
Salary& pension 5 1500 12 90000
Feul transport 1000 12 12000
Total income = 497,280
Total expenditure = 268,080
iii. projected break-even point
Our break-even analysis will be based on running costs that is costs we shall incur in
keeping the business running, including salaries and wages, rent, water and electricity, insurance
amongst others. Hence, many fixed costs shall be included in these costs. We will thus aim to
ensure that our sales levels are running comfortably above break-even.
The following chart and table summarize our break-even analysis. With fixed costs of
approximately 17,540 per month at the outset, we need to bill approximately 3,000 to cover our
costs. We don't really expect to reach break-even until several months into the business
operation.
iv. profit and loss statement
our projected profit and loss is shown on the following table, with sales increasing from
more than birr 497,280 the first year to more than birr 547,200 the second, and approximately
birr 597,120 in the third year. Profits are calculated to be around birr 108,000 before tax the first
year during the start-up phase of this business.
Table: Profit and Loss
V. projected balance sheet
The balance sheet shows healthy growth of net worth, and strong financial position. The
three-year estimates are included in the appendix.
Vi. Projected Cash Flow
Cash flow projections are critical to our success. Detailed monthly numbers are included in
the appendix. However, it should be noted that they do not take into account the required capital
Table: Cash Flow
vii. projected funds flow
Month
Total income
Total
expenditure
net
viii. projected ratio
A). Net profit margin ratio.
√ net income/revenue
229,200/497,280. = 0.46. =46%
B) Asset ternover ratio
√ Asset/revenue
225,470/497,280 = 0.453 = 45.3%
CRITICAL RISKS
Transport risks: this risk associated with the loss of our product during transportation.
Delivery risks: this risk arise when our product are not delivered on time.
Dealing: with different language, business culture and legal system can increase the risk of
confusion.
Restrictions: our customer may be based in a country that impose restrictions or limits on the
item we export which could cause delays.
Political instability: the political environment of the market we considering may pose new
challenges to our business.
Human resources: the number of people we currently employ and their skill sets may need to be
adjusted to address the requirements and added pressure that exporting may bring.
EXIT STRATEGY
No matter how successful our business will be there will be a time that come that will force us
to leave or end the business operation. So in order to prevent the business from liquidating and
greater loss we are planning to use the merger or acquisition exit strategy. In this method the
larger company that we will sell it to will enable the business operation to continue. Besides that
they hopefully won't make that much change to the company and might also achieve the
objective that we already set in the business plan. Moreover they can finance the business too.
And also give us a small part of role in the business if we want to. On top of that our employees
won't leave their job and exhaust themselves by seeking for new job opportunities. It is a win
win method that we will also get the return of money that cost's when we open the company.
APPENDIX
* Our cooprate will have a debt of 300000 from Commercial Bank as well as 200000 from
family.
* The cooprater get source of information from existing companies as well as other
customers.
* Governments encourage small business type.
*There fore our coopraters will license from the city administrative.