INTRODUCTION

This is a partnership business where the main activity of the firm is provided quality product
through the Tepi and Mizan Teferi city, we offer high quality eggs and chicken meat. As we
know, Ethiopian is an over populated country. So, there is no equilibrium between demand and
supply and more or less suppliers fail to satisfy the customers. Most of all, in food business if
it is daily product, there is no loss. So, there is a great prospect being succeeded Each and every
people need chickens and eggs. Eggs are the ingredients of cake, bread, omelet etc. So,
restaurant, bakery, hotel, community centers need eggs and chickens every day.
we aim to provide high-quality meat products to our customers while maintaining the highest
standards of hygiene and food safety. Our goal is to become the preferred supplier of meat and
poultry products in our local market by offering a wide range of options to meet our customers'
needs. We understand that consumers are becoming more conscious about what they eat, and
we are committed to providing healthy and nutritious products that are sustainably sourced. In
this business plan, we will outline our strategies for achieving success in the competitive meat
and poultry industry, including our marketing plan, operational plan, financial projections, and
risk management strategies.

ii
Contents
INTRODUCTION .....................................................................................................................ii
Executive Summary ................................................................................................................... v
CHAPTER ONE ........................................................................................................................ 1
COMPANY OVERVIEW ......................................................................................................... 1
1.2 Introduction ...................................................................................................................... 1
1.2 Mission Statement ............................................................................................................ 1
1.3 Objectives......................................................................................................................... 2
1.3.1 Business concept: ...................................................................................................... 2
1.4 Description of the firm: .................................................................................................... 2
CHAPTER TWO ....................................................................................................................... 3
INDUSTRY ANALYSIS ........................................................................................................... 3
2.1 Analysis of competitors ................................................................................................... 3
2.2 Market segmentation ........................................................................................................ 4
DESCRIPTION OF VENTURE OR BUSINESS ..................................................................... 6
3.1 Product ............................................................................................................................. 6
3.2 Size of business ................................................................................................................ 6
3.3 Office equipment and personnel ...................................................................................... 7
CHAPTER FOUR ...................................................................................................................... 9
PRODUCTION PLAN .............................................................................................................. 9
4.1 Manufacturing process ..................................................................................................... 9
4.2 Machinery, equipment and quantity................................................................................. 9
4.3 Cost of raw materials and raw materials availability ....................................................... 9
4.4 Pre-operating Material Startup costs .............................................................................. 11
4.5 Government Regulation ................................................................................................. 11
CHAPTER FIVE...................................................................................................................... 13
MARKETING PLAN .............................................................................................................. 13
5.1 Selling price ................................................................................................................... 13
Distribution / Market area, Main customers and total demand ............................................ 13
5.2 Production ...................................................................................................................... 13
5.3 Product forecasts / sales forecasts .................................................................................. 14
5.4 Comparison of the product with its competitors ............................................................ 15
5.4.1 Challenges facing the poultry industry ....................................................................... 15
5.5 Analysis of competitors ................................................................................................. 15
5.6 Advertising Strategy (Promotional measures) ............................................................... 16
CHAPTER 6 ............................................................................................................................ 17
ORGANIZATION STRUCTURE ........................................................................................... 17
6.1 Ownership of the business ............................................................................................. 17
 6.2 Form of business Firms .................................................................................................. 18
6.3 Business experience and qualification of entrepreneur .................................................. 18
6.4 Roles and responsibilities of members of organization ................................................. 18
6.4.1 Manager (Chief Operating Officer) of Firms and its function ................................ 19
6.4.2 Human Resources and Admin Manager and its functions ...................................... 19
6.4.3 Sales and Marketing Manager is functions ............................................................. 20
6.4.4 Accountant / Cashier: .............................................................................................. 20
6.4.5 Sales and Marketing Manager ................................................................................. 21
6.5 SWOT Analysis ............................................................................................................. 22
CHAPTER SEVEN.................................................................................................................. 23
FINANCIAL PLANS ANALYSIS .......................................................................................... 23
7.1 Cash flow projection ...................................................................................................... 23
7.1.1 Net present value analysis ....................................................................................... 28
7.1.2 Internal rate of return analysis ................................................................................ 28
7.1.3 Payback period and discount payback period analysis ........................................... 30
Profitability index analysis................................................................................................... 31
7.2 Break even analysis ........................................................................................................ 32

iv
 Executive Summary

Our meat and poultry business is a startup venture that aims to produce high-quality chicken meat
and eggs for the local market. Our company will operate as a farm and will be located around Tepi
with ample land and resources to support our operation.
The market for chicken meat and eggs is growing rapidly due to increasing demand from
consumers who are looking for healthier protein sources. Our products will be produced using
sustainable farming practices, which will set us apart from our competitors.
To make our business succeed, we will invest in modern equipment and technology to ensure high
productivity while minimizing costs. We will also employ skilled labor to manage our farms and
provide excellent customer service to our clients.
Our target market will include supermarkets, grocery stores, restaurants, and households within a
50-mile radius of our farm location , it includes Mizan Teferi city. We will focus on delivering
fresh, high-quality products to our customers at competitive prices.
In conclusion, our meat and egg chicken poultry business has the potential to become a successful
venture by meeting the growing demand for healthy protein sources, investing in modern
technology, and providing excellent customer service to our clients.

v
 CHAPTER ONE

COMPANY OVERVIEW
1.2 Introduction
This is a partnership business where the main activity of the firm is provided quality product
through the Tepi and Mizan Teferi city, we offer high quality eggs and chicken meat. As we
know, Ethiopian is an over populated country. So, there is no equilibrium between demand and
supply and more or less suppliers fail to satisfy the customers. Most of all, in food business if
it is daily product, there is no loss. So, there is a great prospect being succeeded Each and every
people need chickens and eggs. Eggs are the ingredients of cake, bread, omelet etc. So,
restaurant, bakery, hotel, community centers need eggs and chickens every day. As the different
customers has high demand of chickens and eggs, we have a high prospect of our business
success. Chicken meat and eggs will be distributed to restaurant, super shop, hotel, community
center, and bakery and catering houses around Tepi and Mizan Teferi city. prolong the
sufficient supply to the customer is one of our most important purposes. we want to supply
extend area of Tepi and Mizan Teferi city with affordable price. products are sold to other food
manufacturers, renderers, grocery and meat wholesalers and retail traders.

Table 1 Name of the venture

Name of the venture BegLemne Umer and his partners

Address Around Tepi

Founders Umer and His partners

Vision Providing quality product with reasonable price.

1.2 Mission Statement

Our mission to become one of the leading egg and chicken meat processing firm brands not
just in the Ethiopia but also on the global stage. Umer and his partners egg and Chicken meat
poultry firm provided that quality, fresh valuable products through the Tepi and Mizan Teferi
city, we offer high quality eggs and chicken meat that will be gotten from layers and broilers
to our target market for both the Ethiopian market and the global market.

1
1.3 Objectives

The major objective of the founders is reducing poverty, malnutrition and unemployment
problem of our country. Besides, we want to provide quality product to customer and maintain
the supply sufficiently.

1.3.1 Business concept:

Purpose of the venture: 2015 E.C. To meet the demand of customer and built strong customer
relationship, to create the employment opportunity for others and to contribute the economy of
the country
1.4 Description of the firm:

This is a partnership business Purpose of the venture is; To meet the demand of customer and
built strong customer relationship.
➢ To create the employment opportunity for others.
➢ To contribute the economy of the country.

2
 CHAPTER TWO

INDUSTRY ANALYSIS

The chicken meat processing business has greatly benefited from campaigns advertising the health
benefits of chickens and eggs as a good source of protein. No doubt, the increased demand of
chicken and eggs from households and food related businesses and of course the growing
popularity of specially Eggs and chicken meat have rapidly improved revenue growth for the
industry. In the face of this growth, profit margin has suffered from rising feed costs and also
regulations regarding animal welfare. As a matter of fact, investors/entrepreneurs who own big
poultry find it easier to open a standard chicken meat and egg layers processing firms within their
farms. As we know, Ethiopian is an over populated country. So, there is no equilibrium between
demand and supply and more or less suppliers fail to satisfy the customers. Most of all, in food
business if it is daily product, there is no loss. So, there is a great prospect being succeeded Each
and every people need chickens and eggs. Eggs are the ingredients of cake, bread, omelet etc. So,
restaurant, bakery, hotel, community centers need eggs and chickens every day. As the different
customers has high demand of chickens and eggs, we have a high prospect of our business success.
2.1 Analysis of competitors

It is essential for every business organization to identify its existing competitors their skill,
strength and as well as weakness. We have huge number of existing competitors but most of
them have not high skill and future orientation. The future competitors can easily entre the
business because of its low cost and its industry structure is very easy.
Our concern is not only on what we offer but how we offer it. The following approaches will
make us exceptional from the competition:
➢ Reasonably affordable prices

➢ Provide exceptional service to clients that levels ad impressions

➢ A relaxed atmosphere at our facility atmosphere by creatively using the interior decor

➢ Proper management of internal finances and cash flow to enable upward turnover growth
to effectively manage our growth strategies
➢ The highly experienced staff with good communication skills will ensure that the clients
are retained

3
 ➢ A modern technology facilitated by purchases of well modified operating equipment as
opposed to old technology found in other salons
➢ We reached our product (chickens & eggs) to the customers by our own transportation
with a low transportation cost
➢ If any dreadful products are identified by the customers, we always make it change.

➢ Processed meat is also supply if customer feel need

➢ We also supply product by credit to a limited amount

➢ of succeed, because most of the suppliers are not able to adequately supply the product

2.2 Market segmentation

Although in the Ethiopian populace, there are a few, religious or cultural practices that will
prevent the consumption of poultry products, during the market segmentation, we found out
that nearly everybody eats eggs and meat, so we are targeting the whole market, individuals,
homes, and firms that use eggs and chicken in large quantities. Specifically, there is a high
demand for Below is a list of the people and business that we will market our chickens and eggs
to;
Table 2: product distribution
Market Segmentation Market Share
Hotels and restaurants 30
Bakeries and food joints 20
Retail shops 20
Homes or Houses Hold’s 15
Individuals 10
Others 5

4
 MARKET SEGMENTATION

Hotels and restaurants

5%

10 %
Bakeries and food joints

30 %

Retail shops

15 %

Homes or Houses Hold’s

Individuals

20 % 20 %
Others

5
 CHAPTER THREE
DESCRIPTION OF VENTURE OR BUSINESS

Now poultry business is a very popular business in Ethiopian. Because it is very easy and very
small amount is need to start the business. Although there have many existing competitors in
the market, but there has a high chance to succeed because existing competitors are failing to
fulfill the customer’s demand. They are also failing to meet the customers need in the
perspective of service. So, we think that choosing this business is our right decision.

3.1 Product
The product is chickens’ meat and eggs will distribute these products around Tepi and Mizan
Teferi city others part of Ethiopia market. We are in the egg and chicken meat processing
business to make profit and we are going to do all we can to achieve our business goals, aim
and objectives.
Quality assurance is the main motto of our business. We are not compromise in the question of
quality. To ensure the quality we always take high care of our hens and eggs. Now days, from
chickens and eggs harmful diseases are spread out. But we are supply our chickens and eggs
with ensuring that it is free from all kind of jorum, which can create harmful diseases. Cost of
poultry business is not so high. One can easily start a business with a minimum amount of
money. But our cost of business is high, because our business is highly future oriented. We
also provide some additional facility to our customers and consumers that are not provided by
other suppliers:
➢ We reached our product (chickens & eggs) to the customers by our own transportation
with a low transportation cost.
➢ If any dreadful products are identified by the customers, we always make it change.

➢ Processed meat is also supply if customer feel need.

➢ We also supply product by credit to a limited amount. Of success because most of the
suppliers are not able to adequately supply the product with their services.

3.2 Size of business

The new BegLemne Umer and his partnership 1000 egg Layer poultry firm is one of small
scale new in progress licensed 850 egg Layer poultry firm per days in Tepi.

6
 3.3 Office equipment and personnel

For the sake of understanding the business in detail, it is significant to state some of the
equipment which is required for the business to stay afloat. The most used pieces of farm
equipment in 1000 layers of poultry firm, houses are feeders, drinkers, crates and weighing
scales, flame guns and other cleaning equipment are also used. This equipment is listed in the
table below and the description of this equipment is also stated.
Table 3 Equipment Description/ uses
S/N Equipment Description/ uses

1 Generator or This is us to supply electricity to the poultry house as well as

Solar system to keep the poultry house gadget running

2 Feeders They are device used to feed the birds, some of which are
made from plastic or meters.

3 Lighting system Bulbs and rechargeable for light

4 Fully automatic This are device use for holding water for the birds to drink.
drinker

5 Waste bin This is used to trash waste in the poultry farm

6 Table/chair The table and chair are for sales representative and customers

7 Shovel Will be used to clean up the poultry house

8 Nose max This will be use protect and clear the breath of staff when
cleaning the poultry house

9 Gloves Will be used to protect the staff while working in the farm

7
10 Cages Will be used placed of hen

11 Crate Will be used live the hens grouped

12 Egg creates Will be used live the hens grouped

13 Others Will be used live the hens grouped

8
 CHAPTER FOUR

PRODUCTION PLAN

4.1 Manufacturing process

Buying of chickens from

Manufacturing Distribute to Customer
Supplier

Figure 1 Manufacturing process

Our main inventory is chicken and eggs. First of all, we will buy chicken from different area
around Tepi city especially from chicken suppliers and put it into our farm and warehouse.
Then we will distribute healthier eggs and the chicken’s meat that means we ensure that
chickens are not affected by any harmful disease. Then we supply the chickens and eggs to
different restaurant, super shop, hotel, community center, and bakery house as per their order.

4.2 Machinery, equipment and quantity

In business human resources is one of the most important factors and have a big role in a
business organization. For collect inventory, maintaining inventory, and reached the product
to the desired customers we will have to need some people. There are four members and three
employees 3000 birr/months. They will very skillful on their own field. If additional skill and
efficiency needed, we will provide them training. We also supervise their work.

4.3 Cost of raw materials and raw materials availability

When the 1000 layers of poultry firm business plan starting which, the equipment’s and land
are required with an average of 3-4 hens 1m2, 3 months chicken cost is 220 Birr per chicken,
3–5-month chickens feed 5.8 kg per hens, while one feeder and drinker feeds 80 hens and
also the cost of one feeder and drinker is 1500birr,2500birr respectively per feeder drinkers
and the other cost like stress, chemicals, transport, where house, and other are listed below
table.

9
Table 3 list of equipment startup costs for 1000 layers productions period
S/N Equipment Quantity Unit Cost Total cost Description/ uses

1 Generator or 1 25000 25000 This is us to supply

Solar system electricity to the poultry
house as well as to keep the
poultry house gadget
running
2 Feeders 13 1500 19500 They are device used to
feed the birds, some of
which are made from
plastic or meters.
3 Lighting system 1000 1000 Bulbs and rechargeable for
_ light
4 Fully automatic 13 2500 32500 This are device use for
drinker holding water for the birds
to drink.
5 Waste bin 5 150 750 This is used to trash waste in
the poultry farm
6 Table/chair 7 __ 2230 The table and chair are for
sales representative and
customers
7 Shovel 4 600 600 Will be used to clean up the
poultry house
8 Nose max 7 20 140 This will be use protect and
clear the breath of staff
when cleaning the poultry
house
9 Gloves 10 35 350 Will be used to protect the
staff while working in the
farm
10 Cages 7 10000 70000 Will be used placed of hen

10
 11 Crate 15 2400 36000 Will be used live the hens
grouped
12 Egg creates 10 120 1200 Will be used to store eggs
13 Others - - 1000 -
Total costs 190270

4.4 Pre-operating Material Startup costs

Table 4 List of Material Startup costs 1000 layers per 2 years

Items Material Startup costs Co5g Total costs 555(EBR)
Business cards 300

Print 200

Internet 500
Chemicals 600
Advertising/marketing 350
Total 9700

4.5 Government Regulation

The government has various regulations that govern the conduct of businesses in the country
that the firm will comply with and these are shown in the table below: Table 5 Government
Regulation cost
LICENSES SOURCE COST
Registration of Business Registrar of companies 4,000
name
Town council license Town council 18,000

NEMA certificate _________ 2,000

Total _ 24,000

Apart from the registration of the business name and the city council license the firm will also
comply with the approval on the National Environmental Management Authority BegLemne
Umer and his partners poultry firm’s the Ethiopians Standards. The firm will also be paying
10% of its profits to the government as tax. The total BegLemne Umer and his partners 1000
11
layer and meat poultry production businesses firm Production cost, Equipment Startup costs,
Pre-operating Material Startup costs Government Regulation and Promotion and Advertising
Strategies are 3030800, 180270, 9700, 7160 and 2400 EBR respectively. Going by the report
from detailed research and feasibility studies conducted, we will need an estimate of three
million Two hundred fifty-one thousand nine hundred thirty birr (3251930birr) to start a
standard 1000 egg layer and meat processing firms’ business with a poultry farm in the Tepi.

12
 CHAPTER FIVE

MARKETING PLAN

5.1 Selling price

BegLemne Umer and his partners egg layer poultry firm’s will calculate its price based on
used to attend the client. Our farm will provide1000 chicken and eggs with affordable price.
Resources will largely comprise of both time and the tangible resources. However, before we
set the price, we will consider the price of the competitors, since we will make the price to be
competitive to attract more clients. We will be selling our services to our clients on cash basis.
However, after the first year of operation, we will be in a position to identify those clients who
will be loyal to our business and will consider giving them discount on what we charge them.
We will also consider giving after sales service to our loyalties. The price, however, will be
made fixed to all clients and will be displayed at the reception area for accountability.

These 1000 layer can lay a verge of 850 eggs per days 25500 eggs per months. The cost of one
egg average 10 birr so 25500*10=255000 birr in one month. Promotion periods.
Distribution / Market area, Main customers and total demand

We are not going to use any distribution channel at first. We will use personal sales
representative for selling our product. Our sales representatives will directly go to our
customers and collect the order. As per their order we will directly supply chickens and eggs
to the customers by our own transportation
5.2 Production

The product is chickens’ meat and eggs will distribute these products around Tepi and Mizan
Teferi city others part of Ethiopia market. We are in the egg and chicken meat processing
business to make profit and we are going to do all we can to achieve our business goals, aim
and objectives. Quality assurance is the main motto of our business. We are not compromise
in the question of quality. To ensure the quality we always take high care of our hens and eggs.
Now days, from chickens and eggs harmful diseases are spread out. But we are supply our
chickens and eggs with ensuring that it is free from all kind of jorum, which can create harmful
diseases. Cost of poultry business is not so high. One can easily start a business with a minimum
amount of money. But our cost of business is high, because our business is highly future
oriented.

13
 We also provide some additional facility to our customers and consumers that are not provided
by other suppliers:
➢ We reached our product (chickens & eggs) to the customers by our own transportation
with a low transportation cost.
➢ If any dreadful products are identified by the customers, we always make it change.

➢ Processed meat is also supply if customer feel need.

➢ We also supply product by credit to a limited amount.

The primary cost of our business is given below:1000-layer chicken meat processing firms and
poultry farm the operational cost for the within 2 years. Table 6 Production cost list
Items Cost (Birr) / month Total cost (Birr) per 2 years

Warehouse 7000 168000

Transportation 1000 24000

Chicken 190000 190000

Foods of chickens 52200 156600

between (3-5) month
Food of chickens >5 100800 2419200
month
Utility 1000 1000

Employees 3000 72000

Sum 3030800

5.3 Product forecasts / sales forecasts

One thing is certain when it comes to egg and chicken meat processing business, if our products
are well qualified and branded and if our processing firm’s is centrally positioned and easily
accessible, we will always attract customers sales and that will sure translate to increase in
revenue generation for the business. Below is the sales projection for BegLemne Umer and his
partners egg layer poultry firms, it is based on the location of our business and other factors as
it relates to small scale and medium scale egg and chicken meat processing firms start–ups in
Ethiopia at Tepi.
➢ First Fiscal Year: 2326875ETB
➢ Second Fiscal Year: - 2190000ETB
➢ Third Fiscal Year: - 420000ETB

14
5.4 Comparison of the product with its competitors

5.4.1 Challenges facing the poultry industry

Poultry farming has some challenges that need to be attended to with vigor. Below are some of
the common challenges that are faced by poultry farmers such as Death of chickens: In poultry,
one or many chickens usually die because of their fragile nature and the weather they are living
in. Some factors.
5.5 Analysis of competitors

It is essential for every business organization to identify its existing competitors their skill,
strength and as well as weakness. We have huge number of existing competitors but most of
them have not high skill and future orientation. The future competitors can easily entre the
business because of its low cost and its industry structure is very easy. Our concern is not only
on what we offer but how we offer it. The following approaches will make us exceptional
from the competition:
➢ Reasonably affordable prices

➢ Provide exceptional service to clients that levels ad impressions

➢ A relaxed atmosphere at our facility atmosphere by creatively using the interior decor

➢ Proper management of internal finances and cash flow to enable upward turnover growth
to effectively manage our growth strategies
➢ The highly experienced staff with good communication skills will ensure that the clients
are retained
➢ A modern technology facilitated by purchases of well modified operating equipment as
opposed to old technology found in other salons
➢ We reached our product (chickens & eggs) to the customers by our own transportation
with a low transportation cost
➢ If any dreadful products are identified by the customers, we always make it change.

➢ Processed meat is also supply if customer feel need

➢ We also supply product by credit to a limited amount

➢ of succeed, because most of the suppliers are not able to adequately supply the product

15
5.6 Advertising Strategy (Promotional measures)

BegLemne Umer and his partnership Egg layer poultry firm will make use of different methods
of advertising. These methods will mainly be the printing media where the total cost of 1000
layers in three years and frequency of usage is as tabulated below:
Frequency Cost per Annum Total

Kshs
Flyers 4 400 1600

Brochures 4 500 2000

Business cards 4 350 1400

Website links By-sixth month 420 1800

SMS adverts Monthly 15 360

Total 7160

Through the flyers, business cards and the brochures, the image of our services will be
portrayed. The advert will create a picture in our client’s mind that, our services are of high
quality, unique and low priced. The brochure will also illustrate an excerpt of a Eggs and
chickens meats that is available at our place. Since this is a new business in a new market the
firm intends to penetrate and gain acceptance in the target market through:
➢ Personal selling thus approaching the major target customers at personal level and
negotiating.
➢ Advertising through the media that is the radio, television and newspaper.

➢ Running promotions through giving discounts for a specific period to attract potential
customers.
➢ Producing quality products at competitive prices

16
 CHAPTER 6

ORGANIZATION STRUCTURE

The organization structure refers to the cooperate relationship between the employee and the
company. There are sets of roles and responsibilities assigned to each of the employee in the
company. The purpose of this is to ensure that each team member understands what is expected of
him or her daily. The chart below describes based on hierarchy from the uppermost level terms of
employee responsibility to the laborers.

MANA GER

Human Recourses Manager

Marketer

Figure 2 Organization Structure

6.1 Ownership of the business

The ownership type of BegLemne Umer and his partnership egg layer poultry firm is a proprietorship
business. This type of ownership is selected because they are easy to form, flexible, easier division
of work, risk sharing, and the owners enjoy sole control of his or her business profits. However,
they also have disadvantages, one of which is that the owner is personally accountable for all the
business losses, blocking of capitals, difficult to decision making and liabilities. This farm is
intended to start small and grow gradually with easy and flexible implementation policy, the

17
management team will consist of six men and one regular worker. Operation is from Monday to
Saturday, and opening hour will be 7am and closing time will be 6pm.
6.2 Form of business Firms

BegLemne Umer and his partnership egg layer and chicken meat poultry partnership firms Investors
are six members. We will equally contribute in business. Our contributions are showing below:
Name Umer seid, Abdurohman Ali, Abdulaziz Tilahun, Tesfatsion Girma.
6.3 Business experience and qualification of entrepreneur

Table Business of entrepreneur Roles, qualification and responsibilities of members

Name of entrepreneur Position Functions and responsibility

Umer Seid Manager Managing, supervising jobs sorting birds,

sales and marketing
Abdurohman Ali Human Responsible for overseeing the smooth
resources running of HR and administrative tasks for
managers the organization
Abdulaziz Tilahun Marketer Majorly Marketing the product and making
delivery to customers

Tesfation Girma Accountant/Cashier Responsible for preparing financial reports,

budgets, and financial statements for the
organization.

Abdurohman Ali Sales and marketing Manage external research and coordinate
excutive all the internal sources of information to
retain the organization’s best customers
and attract new ones.

Abdulaziz Tilahun Front Desk Officer Welcomes guests and clients by greeting
them in person or on the telephone;
answering or directing inquiries.

6.4 Roles and responsibilities of members of organization

The key management staff refers to the Four levels of employee in the company namely: The
manager, Human resource, the market and the Laboure. In order to understand the assigned

18
 role for each of these employees, the table below is very important, and it creates an opportunity
to describe what is expected for each of the team members.
Table 7 Key Position Functions and responsibility
Position Functions and responsibility

Manager Managing, supervising jobs sorting birds, sales and marketing

Human resources managers Responsible for overseeing the smooth running of HR and
administrative tasks for the organization
Marketer Majorly Marketing the product and making delivery to customers

Laboure’s Feeding and cleaning of the poultry house change the water and clean
the drinkers

6.4.1 Manager (Chief Operating Officer) of Firms and its function

➢ Increases management’s effectiveness by recruiting, selecting, orienting, training, coaching,

counseling, and disciplining managers; communicating values, strategies, and objectives;
assigning accountabilities; planning, monitoring, and appraising job results; developing
incentives; developing a climate for offering information and opinions; providing
educational opportunities.
➢ Creating, communicating, and implementing the organization’s vision, mission and overall
direction – i.e., leading the development and implementation of the overall organization’s
strategy.
➢ Responsible for fixing prices and signing business deals.
➢ Responsible for providing direction for the business.
➢ Responsible for signing checks and documents on behalf of the company.
➢ Evaluates the success of the organization.
6.4.2 Human Resources and Admin Manager and its functions
➢ Maintains office supplies by checking stocks; placing and expediting orders; evaluating new
products.
➢ Ensures operation of equipment by completing preventive maintenance requirements;
calling for repairs.

19
 ➢ Updates job knowledge by participating in educational opportunities; reading professional
publications; maintaining personal participating in professional organizations’ activities.
➢ Enhances department and organization reputation by accepting ownership for
accomplishing new and different requests; exploring opportunities to add value to job
accomplishments.
➢ Defining job positions for recruitment and managing interviewing process.
➢ Carrying out staff induction for new team members.
➢ Responsible for training, evaluation and assessment of employees.
➢ Responsible for arranging travel, meetings and appointments
➢ Oversees the smooth running of the daily office activities.
6.4.3 Sales and Marketing Manager is functions

➢ Manage external research and coordinate all the internal sources of information to retain
the organization’s best customers and attract new ones.
➢ Model demographic information and analyze the volumes of transactional data generated
by the customer.
➢ Identifies development opportunities; follows up on development leads and contacts;
participates in the structuring and financing of projects; assures the completion of
development projects.

➢ Writing winning proposal documents, negotiate fees and rates in line with organization’s
policy.
➢ Responsible for handling business research, market surveys and feasibility studies for
clients.
➢ Responsible for supervising and advocating for the customer’s needs, and communicate
with clients.
➢ Develop, execute and evaluate new plans for increasing sales.

➢ Create new markets cum businesses for the organization.

➢ Empower and motivates the sales team to meet and surpass agreed targets.

6.4.4 Accountant / Cashier:

➢ Responsible for preparing financial reports, budgets, and financial statements for the
organization.

20
 ➢ Provides managements with financial analyses, development budgets, and accounting
reports; analyzes financial feasibility for the most complex proposed projects; conducts
market research to forecast trends and business conditions.
➢ Responsible for financial forecasting and risks analysis.

➢ Performs cash management, general ledger accounting, and financial reporting for one or
more properties.
➢ Responsible for developing and managing financial systems and policies.

➢ Responsible for administering payrolls.

➢ Ensuring compliance with taxation legislation.

➢ Handles all financial transactions for the company.

➢ Serves as internal auditor for the company.

6.4.5 Sales and Marketing Manager

➢ Manage external research and coordinate all the internal sources of information to retain
the organization’s best customers and attract new ones.
➢ Model demographic information and analyze the volumes of transactional data generated
by the customer.
➢ Identifies development opportunities; follows up on development leads and contacts;
participates in the structuring and financing of projects; assures the completion of
development projects.
➢ Writing winning proposal documents, negotiate fees and rates in line with organization’s
policy.
➢ Responsible for handling business research, market surveys and feasibility studies for
clients.
➢ Responsible for supervising and advocating for the customer’s needs, and communicate
with clients.
➢ Develop, execute and evaluate new plans for increasing sales.

➢ Create new markets cum businesses for the organization.

➢ Empower and motivates the sales team to meet and surpass agreed targets.

6.4.6 Front Desk/Customer’s Service Officer

➢ Welcomes guests and clients by greeting them in person or on the telephone; answering
or directing inquiries.

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 ➢ Ensures that all contacts with clients (e-mail, walk-In center, SMS or phone) provides the
client with a personalized customer service experience of the highest level.
➢ Thorough interaction with clients on the phone, uses every opportunity to build client’s
interest in the company’s products and services.
➢ Manages administrative duties assigned by the manager in an effective and timely manner.
➢ Consistently stays abreast of any new information on the company’s products,
promotional campaigns etc. to ensure accurate and helpful information is supplied to
clients.
➢ Receives parcels/documents for the company.

➢ Distribute mails in the organization.

➢ Handles any other duties as assigned by the line manager.

6.5 SWOT Analysis

BegLemne Umer and his partners egg layer and Chicken meat Processing poultry firms does
not intend to launch out with trial-and-error methods hence the need to conduct a proper SWOT
analysis. We know that if we get it right from the onset, we would have succeeded in creating
the foundation that will help us build a standard eggs and chicken meat processing firms that
will favorably compete with leading egg and chicken meat processing firms in Ethiopia.

Table 8 SWOT Analysis

Strengths Weaknesses
➢ Convenient Location ➢ Staff turnover
➢ Lack of a proper pricing regime.
➢ Well-resourced in equipment.
➢ Capital intensive.
➢ Extended hours of service. ➢ Starting a poultry business requires a large
capital funding.
➢ Produce high-quality eggs enriched with
➢ Outbreak of disease can ruin entire business in
protein
a go
➢ Relatively good infrastructure systems
➢ The smell can be quite disturbing
➢ Good marketing system Eggs and chicken are
not seasonal
➢ products and can be eaten at any time of the
year In this area, over-exploited Poultry are
environmentally friendly

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Opportunities Threats
➢ Others with same level of ability will open the
➢ Open new branches at other areas.
same service, since this business model is
➢ Join with other party at franchisee form
easy to replicate.
business.
➢ The manager’s ability is what will determine
➢ Start cross breeding and importation of High-
growth.
quality chicks.
➢ Poaching of staff by other firms.
➢ Expansion into large scale production of ➢ More competition Avian diseases High feed
ingredients prices Threat of import of frozen
byproducts (fertilizer and detergent)
chicken
➢ Export to neighboring towns
➢ A large and successful poultry will ensure
food security

CHAPTER SEVEN

FINANCIAL PLANS ANALYSIS

7.1 Cash flow projection

Projected Profit and Loss as the Profit and Loss table shows the farm expects to have rapid
growth in sales revenue and an increase in net profit over the next three years of operations.
As the Profit and Loss table shows the farm expects to have rapid growth in sales revenue and
an increase in net profit over the next three years of operations. The total cost of the new

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 BegLemne Umer and his partners 1000 egg layer poultry forming is 4936875 birrs for the next
three production year.
Cash out
1.cost of equipment for first year

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 S/N Equipment Quantity Unit Cost Total cost

1 Generator or 1 25000 25000

Solar system

2 Feeders 13 1500 19500

3 Lighting system 1000 1000

_
4 Fully automatic 13 2500 32500
drinker

5 Waste bin 5 150 750

6 Table/chair 7 __ 2230

7 Shovel 4 600 600

8 Nose max 7 20 140

9 Gloves 10 35 350

10 Cages 7 10000 70000

11 Crate 15 2400 36000

12 Egg creates 10 120 1200

13 Others - - 1000
Total costs 190270

2.start up costs for 1st and 2nd year

Items Material Startup costs Co5g Total costs 555(EBR)

Business cards 300

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 Print 200

Internet 500

Chemicals 600
Advertising/marketing 350
Total 9700

3.Food and water consumption for the 1st and second year

consumption Per 100 hens Per 1 hens Total Cost per per 1st 2 year 3rd
per day per day cost per kg or L year year
day
food 14.28kg 142.85 kg 285.7 10 521402 >> >>

water 5L 50 5 0.01 1825 >> >>

Total _ _ 290.7 2.01 523227 >> >>

4.Govermental cost for 1st and 2nd year

LICENSES SOURCE COST

Registration of Business Registrar of companies 4,000
name
Town council license Town council 18,000

NEMA certificate _________ 2,000

Total _ 24,000

5.hens 1000 hens of total cost 190000 in first year

Employee 10 employees with 3000-birr monthly sallary. Total cost =30000*12=360000 for 1st and
second year

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Cash in

Table 9 Cash flow projection

Production year Types of Products Quantity Unit price Total sales
EGGS HENS eggs/year eggs revenue

MEATS
Year 1 850 ___ 310250 7.50 2326875

Year 2 800 ___ 292000 7.50 2190000

Year 3 ___ 1000 420 420000

1000
TOTAL 4936875

The new BegLemne Umer and his partnership 1000 egg layer partnership poultry firm is
considering investing in a project which costs 3251930 birrs Determine whether project is
acceptable if the cost of capital is 18% using the Net present value analysis, IRR, Payback
period and discount payback period analysis method. and has the following cash flows

Table 10 Summary
year Total cost Total cash in profit
1 1297197 2326875 1029678

2 892927 2190000 1297073

3 _ 420000 420000

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7.1.1 Net present value analysis

Where; Ct = cash flow at the end of period

t K = required rate of return n =
useful life of project
Io = initial cost of project

Table 11 Net Present Value

Year Cash flow 1/(1+K) n PV
1 2326875 0.8475 1972026.5625
2 2190000 0.7182 1572858
3 420000 0.6086 255612
Cash in 3800496.5625
Cash Out 3251930
Net Present Value 548566.5625

NPV>0 this means the new BegLemne Umer and his partners 1000 egg layer poultry forming
is accepted the project.

7.1.2 Internal rate of return analysis

Where; LR = Lower rate and

HR = higher rate

For the given project at rates of 18% is

Table 12 Internal rate of return analysis at 18%

Year Cash flow 1/(1+K) n K=18% PV
1 2326875 0.8475 1972026.5625
2 2190000 0.7182 1572858

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 3 420000 0.6086 255612
Cash in 3800496.5625
Cash Out 3251930
Net Present Value 548566.5625
since, NPV at 18% is positive but not large, we select a slightly higher rate, say, 31%. Table
13 Internal rate of return analysis at 31%
Year Cash flow 1/(1+K) n K =31% PV
1 2326875 0.7634 1778430.5625
2 2190000 0.5827 1276113
3 420000 0.4448 186816
Cash in 3241359.5625
Cash Out 3251930
Net Present Value -10573.4375
Since NPV at 18 is positive and NPV at 31% is negative, IRR therefore lies between 18% and
31%, and since zero NPV will be between 548566.5625 and -10573.4375, to get the correct
(exact) IRR we have to interpolate between 18% and 31% using interpolation formula.

𝐼𝑅𝑅 = 18 + (31 − 18) ( ) = 30.4138%

A project is accepted if the internal rate of return exceeds the required rate of return.

• If IRR > RRR =Accept

• If IRR = RRR =Accept

• If IRR < RRR =Reject

Based on the above calculations of BegLemne Umer and his partnership egg layer poultry
firms is IRR>RR that means 30.4138%>18% the project is accepted.

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7.1.3 Payback period and discount payback period analysis

Figure 4 Payback period

Payback period = 1 + ( ) = 1.422𝑦𝑎𝑒𝑟

cash flow
Discounts cash flow = (1 + 𝑘)𝑛

Where n=no of year

K=rate

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 Figure 5 DISCOUNT PAY BACK PERIOD (DPBP)

DISCOUNT PAY BACK PERIOD(DPBP) = 1 + =1.36 years

Profitability index analysis
The sum of 3251930 birr invests the next in poultry farming for the discount rate of 18% for
the next three production year.
cash in flow
Profitability index =
cash out flow
If Profitability index>1 project is accepted
If Profitability index<1 project is rejected

Table 14 Profitability index analysis

Year Cash flow 1/(1+K) n K=18% PV
1 2326875 0.8475 1972026.5625
2 2190000 0.7182 1572858
3 420000 0.6086 255612
Cash in 3800496.5625
Cash Out 3251930
Net Present Value 548566.5625

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 Table 15 Profitability index calculations

Profitability index =Crash inflow/cash out flow 1000379248897

Crash inflow 3800496.5625
Cash out flow 3251930
Profitability index 1.1687

If Profitability index>1 project is accepted that is 1.1687>1 The

new poultry firm businesses plane is accented.

7.2 Break even analysis

Break even analysis is one of the four main capital budgeting techniques. It can be sugested by
breakeven point calculation, the point at which there is neither profit nor loss exists.
BEP can be calculated as follows:

P = R-C

Where P = Profit

R= Revenue R = SP*Units sold

C=Cost TC=FC+VC*units manufactured

Where, TC= Total cost, SP= Selling price, FC= Fixed cost, VC = Variable cost Therefore,
we assuming that, units manufactured equal units sold.
The breakeven point is the point where profit is zero, so profit/loss =0=R-C

0=SP*units sold -FC-VC*units sold= (SP-VC)*units sold – FC Units sold

Thus, the calculation is as follows;

i. Break - even in units

𝐹𝐶
(𝑄u) =
( 𝑆𝑃 − 𝑉𝐶)

i. Break - even in Birr

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 𝐹𝐶 𝐹𝐶
( 𝑄 b) = 𝑆𝑃 – 𝑉𝐶 or 𝑉𝐶
𝑆𝑃
( 1 − 𝑆𝑃 )

Break-Even Analysis for 1st year

Total sales of egg on average ………………… 2,295,000

Total cost of each hen …………………………190,000

Gross profit (GP) ………………………………… (2,295,000– 190,000) = 2,105,000 Gross

profit margin (GPM) = GP * 100% = ( ) * 100%= 91.27%
𝑆𝑎𝑙𝑒𝑠

Overhead (fixed cost) for first year ………………………….18,972

Breakeven turn over = Overhead * 100% = 18,972* 100% = 1131490.07

Gpm 59.64%

Breakeven Analysis for 2nd year

Total sales of egg and hen ………………………………….2,610,000

Total cost of each hen……………………………………… 190,000

Gross profit (GP) ……………………………(2,610,000 – 190,000) =2,420,000 Gross

profit margin (Gpm) = GP * 100% = (2 ,420,000) * 100% = 92.72%
𝑆𝑎𝑙𝑒𝑠 2,610,000

Overhead (fixed cost) for 2nd year …………………………. 18,972

Breakeven turn over = Overhead * 100% = 18,972 * 100% = 2046160.431 birr

Gpm 92.72%

Break even gross profit margin = Overhead (fixed cost) for 2nd year * 100% = * 100% =
Total sales of T−shirt for 2nd year

0.72%

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