BUSINESS PLAN

BELLYS GOLDEN BAKERY

P.O BOX 174-40300

HOMABAY

BY: BELINDA AWUOR

INDEX NO: 717106048

PAPER NO: 2802/306b

BUSINESS PLAN SUBMITTED TO THE KENYA NATIONAL EXAMINATION

COUNCIL IN PARTIAL FULFILMENT OF THE REQUIREMENT FOR AWARD OF
DIPLOMA IN FOOD AND BEVERAGE MANAGEMENT

SIALA TECHNICAL TRAINING INSTITUTE

P.O BOX 164-40404

RONGO

NOVEMBER 2024
 DECLARATION
I declare that the business plan is my original work which has never been submitted to the
Kenya National Examination Council for the award of a degree or a diploma or certificate or
artisan to any institution.

Name: BELINDA AWUOR

Signature:………………………………………

Date:…………………………………………..

Supervisor’s name: MR. ONGARO MOSES

Signature: ………………………………………

Date:………………………………………………..

ii
 DEDICATION
I dedicate this work to my lovely mother and the entire family members for their motivation
and financial support.

iii
 ACKNOWLEDGEMENT
I acknowledge the following people for their support during my business plan work. My
mother Benter Kobe for the financial support, my trainer Mr. Moses Ongaro for the
guidelines and my fellow colleagues that gave me the peace and

iv
Table of Contents
DECLARATION .................................................................................................................................. ii
DEDICATION ......................................................................................................................................iii
ACKNOWLEDGEMENT ....................................................................................................................iv
EXECUTIVE SUMMARY .......................................................................................................................... 1
CHAPTER ONE ....................................................................................................................................... 3
1.1 BUSINESS NAME ............................................................................................................................. 3
1.2 Business location and address .................................................................................................... 3
1.3 Forms and types of ownership .................................................................................................... 4
1.3.1 Forms forms of ownership ................................................................................................... 4
1.3.2 types of ownership ............................................................................................................... 4
1.4 PRODUCT AND SERVICE .............................................................................................................. 4
1.5 justification of opportunity ......................................................................................................... 5
1.6 industry ....................................................................................................................................... 5
1.7 goals and objectives of the business ........................................................................................... 6
1.7.1 Business goals ...................................................................................................................... 6
1.7.2 Business objectives .............................................................................................................. 6
1.8 Entry and growth strategy .......................................................................................................... 6
1.8.1 entry strategy ....................................................................................................................... 6
1.8.2 growth strategy .................................................................................................................... 6
CHAPTER TWO: MARKETING PLAN ....................................................................................................... 7
2.1 CUSTOMERS ................................................................................................................................ 7
2.2 market share ............................................................................................................................... 7
2.3 COMPETITOR .............................................................................................................................. 8
2.4 Methods of promotion and advertisement................................................................................. 8
2.5 pricing strategy ........................................................................................................................... 9
2.6 Distribution/sales strategy .......................................................................................................... 9
CHAPTER THREE:ORGANIZATION PLAN .............................................................................................. 10
3.1 ORGANIZATION PLAN STRUCTURE ............................................................................................ 10
3.2 BUSINESS MANAGER AND QUALIFICATION .............................................................................. 10
3.3 personnel number and duties ................................................................................................... 11
3.4 recruitment, training and promotion ........................................................................................ 11
3.5 renumeration and incentives .................................................................................................... 12
3.6 licence, permit and by-laws ...................................................................................................... 12
3.6.1 Business by-laws ................................................................................................................ 13
3.6.2 Business adress .................................................................................................................. 13

v
 3.6.3 Business membership ........................................................................................................ 13
3.6.4 source of business finance ................................................................................................. 13
3.6.5 business loans .................................................................................................................... 13
3.6.6 financial year ...................................................................................................................... 13
3.6.8 Business books and records ............................................................................................... 13
3.7 business support services ......................................................................................................... 14
CHAPTER FOUR: OPERATIONAL PLAN ................................................................................................. 15
4.1 PRODUCT OR SERVICE DESIGN AND DEVELOPMENT ................................................................ 15
4.2 production/ operational facilities and capacity ........................................................................ 15
4.3 production/service strategy ...................................................................................................... 17
4.4 production process ................................................................................................................... 18
4.5 Regulations affecting operations .............................................................................................. 19
4.5.1 Public health act ................................................................................................................. 19
4.5.2 Employment act ................................................................................................................. 19
4.5.3 Trade license act ................................................................................................................ 19
4.5.4 Factory industry act............................................................................................................ 19
4.6 equipment or materials required for the business ................................................................ 19
CHAPTER FIVE: FINANCIAL PLAN ......................................................................................................... 20
5.1 Pre-operational cost.................................................................................................................. 20
5.2 working capital .......................................................................................................................... 20
5.3 CASH FLOW PROJECTION .......................................................................................................... 21
5.3.1 Quarterly cash flow projection ........................................................................................... 26
5.4.1 INCOME STATEMENT ......................................................................................................... 29
5.4.2 BALANCE SHEET ................................................................................................................. 30
5.5 CALCULATION OF BREAK-EVENT POINT .................................................................................... 31
5.6 CALCULATION OF PROFITABLE RATION .................................................................................... 32
5.7 DESIRED FINANCING ................................................................................................................. 32
5.8 PROPOSED CAPITALIZATION ..................................................................................................... 33
APPENDIX............................................................................................................................................ 34

vi
 EXECUTIVE SUMMARY
Business description

The proposed business will be named BELLY’S GOLDEN BAKERY. It intends to start its
operation on 1st January 2025. It will be located in Homabay town, along Homabay high
school, tom Mboya university near Homabay teaching and referral Hospital. The business
will be sole proprietorship belonging to hospitality industry. The following objectives will
guide the business to ensure quality production to generate 25% profit quarterly. To employ
six people at the start of the business. Goals of the business are to achieve customer
satisfaction, to create employment and to maximize profit. The business will conduct cake
tasting events and also do advertisement to create awareness. The proposed business will
require Ksh. 1,108,000 to start operating

Marketing plan

The most target customers will be local residents who will use cash as mode of payment for
the products. The business intends to capture 1,300 customers out of 2100 potential
customers accounting for 61% of the total market share. There are two competitors who
are located closely with similar business. Business advertisement will be conducted on Radio
Ramogi and promotion done through cake cutting events. The unit prize will be determined
by competitors pricing desired profit margin and cost of production.

Organizational plan

The proposed business will have six staffs including manager who will assist in business
operations. Recruitment will be done through interview to staff members, training will on
jobs coaching and off jobs. The business will require Ksh. 86,000 to pay salaries per month.
It will have trade license and food handlers’ certificate. It will have three support services
namely; banking, security and licensing

Operational plan

The business will bake and decorate cakes for occasions such as wedding, birthday and
anniversary and any other occasion that may require cake cutting. The following equipment
will ensure effective operation of the business ; oven fridge, mixing machine,turn table,

1
blender, weighing scale, decorating tools, baking tins and other utensils. The business will
welcome new ideas (creative innovations) in order to improve and cope with new trends.

Financial plan

Pre-operational cost will be Ksh. 318,000 and the working capital for the first year of 2025
will be 350,000, the total receipts in quarterly cash flow projection will be Ksh. 1,942,000,
Ksh 2,199,000 and Ksh. 2,279,000 for the first three consecutive years respectively. The total
payments in quarterly cash flow projection will be Ksh. 340,000 and capital employed will be
Ksh. 634,000. The proposed business will require a total of Ksh. 1,108,000 to start.

2
CHAPTER ONE

1.1 BUSINESS NAME

The proposed business name will be BELLY’S GOLDEN BAKERY. The first word has been
derived from the owners name Belinda. The business will start on 1st January 2025.

1.2 Business location and address

The business will be located in Homabay town along Homabay high school- Governor’s
office road, near county referral hospital opposite Diana beauty salon next to Diana beauty
and cosmetics shop, Block number 10b

Below is the sketched map showing the location

Homabay Town
Homabay primary Governor’s office

Belly’s
Golden
Bakery Tom
Homabay referral
Homabay high school Mboya
Rodi
University
Hospital

Below is the business adress

Belly’s golden bakery

p.o box 174-40300

homabay

Email : kogingazbellycakes@gmail.com

3
1.3 Forms and types of ownership
1.3.1 Forms forms of ownership
Belly’s Golden Bakery will be sole proprietorship business

Advantages of sole proprietorship

i. Faster decision making

ii. Require small capital to start
iii. Flexible
iv. No sharing of the profit

Disadvantages of sole proprietorship

i. Suffers the losses alone

ii. A lot of work is done by one person hence tiresome
iii. Can be easily closed when the owner dies

1.3.2 types of ownership

The enterprise will require Ksh. 1,108,000 to start to start operation

The money will be raised as following;

S/NO SOURCE AMOUNT %

1. OWNERS CONTRIBUTION 328,000 29.6%
2. KCB LOAN 150,000 13.5%
3. CO-OPERATIVE LOAN 506,000 45.1%
4. DONATION 130,000 11.8%
TOTAL 1,108,000 100%

1.4 PRODUCT AND SERVICE

The business will deal with production of quality baked and decorated cakes for various
occassions e.g. birthday, wedding, anivesaries, baby shower and any other function that needs
cakes, marble cakes and any other type of cakes depending on clients needs. The cakes will
be of different sizes, shapes e.g round, square heart shape and of different flavors such as
vanilla, lemon, mint, chocolate, orange according to customers taste & preference.

4
1.5 justification of opportunity
After peforming a background check on the scope of the usiness, it was realized that there is
no cake bakery around in the process despite the high demand for cakes as the residents of
the area are majorly students from Tom Mboya University & KMTC who normally holds
parties e.g. birthday and graduation parties that requires cakes, other than the students, the
residents of the area being in an urban & modern society, they also have demand for cakes as
they hold birthday parties for their kid, babyshower and weddings , the business will create
job opportunity for people who are qualified for the jobs.

1.6 industry
The proposed business belong to the retail service industry, the business will be competing
with two other bakeries offering almost the same products. They are located approximately 2-
3 km away from the proposed business. The industry will have a rapid growth and changes in
modern technology in production. The bakeries have employed averagely four personnel per
firm. Factors such as electricity, power shortage, sesonal factors such as low peak period and
lack of enough capital may affect the business. The industry have a profitable trend and
requires an average of ksh. 600,000 for a start, a bar graph showing the industry peformance
in the last 3 years.

90

80

70

60

50

40

30

20

10

0
2021 2022 2023

signs of profitability ()

5
1.7 goals and objectives of the business
1.7.1 Business goals
The following goals are set to be met by the business

i. To achieve customer satisfaction

ii. To create employments
iii. To maximize profit

1.7.2 Business objectives

i. To ensure production of high quality cakes
ii. To generate 25% profit quartely
iii. To employ 5 members of staff at the start of the business.

1.8 Entry and growth strategy

1.8.1 entry strategy
The business will conduct cake testing event every two weeks of the opening and also do
advertisement on radio during the first month of opening to create awareness. The business
will employ qualified people to ensure quality production

1.8.2 growth strategy

The proposed business intends to open a branch near Mawego TTI one year after the start.

6
CHAPTER TWO: MARKETING PLAN
2.1 CUSTOMERS
The proposed business customers will be residents of homabay town regardless of the age,
sex, religion , race or income rate. The business will also be looking forward to different
referals from satisfied customers to other people even beyond Homabay Town. The
enterprise will ensure that production of quality products according to the customers
preferance. Customers will pay through cash.

2.2 market share

Belly’s Golden Bakery intends to capture 1300 potential customers out of the total of 2100
which is the market share.

Market share distribution table

Firm No. of customers Market degree

Belly’s Golden Bakery 1300 61.9%
Cassie home bakery 350 16.86%
Lake side bakery 450 21.4%
Total 2100 100%

Market share distribution chart

BELLY LAKE SIDE CASSIE

7
 2.3 COMPETITOR
The proposed business competitors are cassie. Home bakery and lake side bakery which are
2.3 km away from each other.

Competitors services comparison table

Firm Quality of service offered Level of competency Cost of ervice Total

Cassie home bakery 15 10 20 45
Belly’s golden bakery 20 20 15 55
Lakeside bakery 10 10 15 35
Total 45 4 50 135

Key

10

15

20

SWOT analysis

Firm Strength Weakness Opportunity Threat

Cassie home Qualified staff Inadequate High population Insecurity
bakery working
materials
Belly’s golden Qualified staff Language High demand Stiff
bakery barrier between for the products competition
Lakeside Conducive Low quality Low demand of Poor roads
bakery working products the product
environment

2.4 Methods of promotion and advertisement

The proposed business will be advertised on radio Ramogi once a week Ksh. 2000 per advert.
The business will conduct cake tasting event to help in creation of awareness and sowcasing
the producs, business cards will be given to people who attend.

8
2.5 pricing strategy
In determinig the product unit selling price, the business will consider the following factors.

1. The going market price

2. Competitors price
3. Cost of production
4. The profit margin

2.6 Distribution/sales strategy

The proposed business will be a retail. The owner will employ workers who will help in both
production and service. The staffs will be attending to the customers directly

9
CHAPTER THREE:ORGANIZATION PLAN
3.1 ORGANIZATION PLAN STRUCTURE
The proposed business will hire six workers including the manager who will be the owner of
the business

Organization structure

MANAGER

DELIVERY STAFF PARTISER 2

PARTISER 1

STEWARD SECURITY

3.2 BUSINESS MANAGER AND QUALIFICATION

S.NO PERSONNEL QUALIFICATION
1. Manager Diploma in food and beverage
2. Partiser 1 Certificate in pastry works
3. Partiser 2 Certificate in pastry works
4. Delivery staff Driving certificate
5. Steward KCSE or KCPE certificate
6. Security Certificate in KCSE D plain & above

10
3.3 personnel number and duties
S.NO PERSONNEL NUMBER DUTIES
1. Manager 1  Staff supervision
 Recruitment of the staff
 Operating IT
 Public relation
 Receives payment
 Purchasing
2. Partiser 1 2  Baking cakes
 Writing requisition for the bakery
items
 In charge of the kitchen
3. Partiser 2 1  Decorates the cakes
 Package the cakes
 Take pictures of the cake for
advertisement
4. Delivery staff 1  Deliver cakes to customers
 Helps in baking an decoration
5. Steward 1  Responsible for kitchen cleanliness
and the whole bakery
6. Security officer 1  Maintaining security
 Cleaning of the outside bakery

3.4 recruitment, training and promotion

Personnel Recruitment training Promotion
Manager Interview On job Peformance appraisal
Partiser 1 Interview Off job Peformance
Partiser 2 Interview Off job Diploma in pastry
Delivery staff Interview Coaching Peformance
Steward Interview On job Peformance appraisal
Security officer Interview coaching Peformance

11
 3.5 renumeration and incentives
Personnel Basic salary House Medical Commuter Total Incentives
allowance allowance allowance
Manager 15,000 2,000 2,000 1,000 20,000 Overtime
Free lunch
Partiser 10,000 2,000 2,000 1,000 15,000 Overtime
Free lunch
Decorating 10,000 2,000 2,000 1,000 15,000 Overtime
staff Free lunch
Delivery staff 8,000 2,000 2,000 1,000 13,000 Free airtime
Free lunch
Steward 6,000 2,000 2,000 1,000 11,000 Free lunch
Security 7,000 2,000 2,000 1,000 12,000 Overtime
Free supper
Total 86,000

3.6 licence, permit and by-laws

S/NO Licence/permit Where obtained Annual cost(ksh)
1. Trade licence Homabay county trade 5,000
licence office
2. Food handlers certificate Homabay referral hospital 6,000
3. Health clearance certificate Homabay health office 3,000

12
3.6.1 Business by-laws
The proposed business name will be registered as BELLY’S GOLDEN BAKERY

3.6.2 Business adress

The proposed business adress will be

BELLY’S GOLDEN BAKERY

P.O BOX 174-40300,

HOMABAY

Email: kogingazbellycakes@gmail.com

3.6.3 Business membership

The proposed business will comprise of the business original shareholders, members who
signed the application for registration form and new member subsequently admitted in
accordance with the business by-laws

3.6.4 source of business finance

The proposed business will source its funds from owners personal savings , bank loan and
donation from friends

3.6.5 business loans

The following business will acquire loans from co-operative bank and Kenya Commercial
Bank

3.6.6 financial year

The proposed business financial year will start on the business trading year

3.6.7 Amendments of by-laws

The business by-laws will be ammended in accordance to to the food handlers authority of
kenya

3.6.8 Business books and records

The following books and records shall be kept

a) Register of members (staff)

b) Property record
c) Cashbook showing the details on flow of money

13
 d) General ledger

3.7 business support services

S/NO SUPPORT SERVICE SERVICE PROVIDER CONTACT
1. Banking KCB KCB homabay 07203270000
Co-Operative Bank Co-operative bank 0203288700
2. Security BM security 072208700
3. Licence Homabay county health department 0592033200

14
 CHAPTER FOUR: OPERATIONAL PLAN
4.1 PRODUCT OR SERVICE DESIGN AND DEVELOPMENT
The proposed business will be a cake bakery. The bakery name and logo will be a cake
bakery. The bakery name and logo will enable the clients to differentiate it from other
bakeries. The business will offer quality products to their customers.

Weekly production cost/expenses

S/NO ITEM COST

1. Electricity 1,000
Insurance 2,000
Rent 15,000
2. Water 200
3. Delivery expenses 1,000
4. Advertisement 2,000
5. Stationeries 300
Total 21,500

4.2 production/ operational facilities and capacity

S/NO ITEMS QUANTITY COST TOTAL WHEN SOURCE REQUISITION CONDITION
REQUIRED METHOD
1. Weighing 1 1,000 1,000 At start Kilimall Purchase New used
machine
2. Fridge 2 25,000 50,000 At start Kilimall Purchase Used
3. Oven 2 15,000 30,000 At start Kilimall Purchase New
4. Baking tins Dozen 3,000 3,000 At start Kilimall Purchase New
5. Mixer 2 3,500 7,000 At start Kilimall Purchase New
6. Measuring Dozen 1,000 1,000 At start Kilimall Purchase New
cups
7. Turn table 2 2,000 4,000 At start Kilimall Purchase New
8. Decorating 1 6,000 6,000 At start Kilimall Purchase New
set
9. Display 1 10,000 10,000 At start Kilimall Purchase New

15
10. Cake 4 1,000 4,000 At start Kilimall Purchase New
stands
11. Table 2 2,000 400 At start Echoe Purchase New
furnitures
12. chair 5 750 3,750 At start Sairam Purchase New

Required fixed assets

Item Number Cost

Chairs 5 5,750
Tables 2 4,000
Oven 2 30,000
Fridge 2 50,000

The premise layout

WASHROOMS PARKING AREA

PRODUCTION AREA

BAKING AREA
DISPLAY FOR CAKES
RECEPTION

SECURITY POST

DECORATING AREA &

PACKAGING
MANAGERS
OFFICE

16
 4.3 production/service strategy
The production will involve professionalism in order to acquire quality materials for
production. The following steps will be put into consideration

a) Requisition

Involves writing a list of items required for production, packaging and delivery

b) Purchasing

It involves selection of the best supplier goods and price and placing order to be delivered
according to the requisition

c) Receiving of goods

This involves sorting out the delivered items according to the purchase order. It involves
weighing and actual counting of goods according to the order specification and payig.

d) Storing

Goods are stored until need arises for usage

e) Issuing

This is where goods are given out for production or service from store.

Production ingredients table

Types of raw materials Frequency Source Quantity Cost (ksh) Total

Wheat flour Once a week K’otieno Wholesalers 1 bale 2,400 2,400
Margarine Once a week Shivillink 10kg 3,500 3,500
Sugar Once a week Shivillink 25kg 4,300 4,300
Eggs Once a week Homabay egg deport 5 crates 450 2,250
Baking powder Once a week K’otieno wholesalers Dozen 30 360
Flavoring essence Once a week Shivillink 5 100 500
Whipping cream Once a week Shivillink Dozen 700 8400
milk Once a week Shivillink 1 box 700 700
Total 22,410

17
4.4 production process
The following processes will be involved in the business production

a) Preparation stage

It involves weighing of ingredients for production, dusting of baking tins and lining with
parchment papers

b) Actual production

Mixing of ingredients according to the recipe. Pouring the mixture into a baking tin & putting
in the oven to cook

c) Product testing

It involves checking on the color, smell, texture and confirming by inserting a knife if the
cakes are ready

d) Decoration of the cakes

This involves trimming of cakes into good shapes crump coating and decorating according to
customers request

e) Delivery

Involves distribution of the cakes to the clients

Preparation stage

Actual production

Product testing

Decoration of the cakes

Delivery

18
The following factors may affect the production process

i. Lack of enough capital

ii. Competition
iii. Shortage of electricity
iv. Lack of enough staff

4.5 Regulations affecting operations

4.5.1 Public health act
The business will ensure that all obtain a health certificate and food handling certificate

4.5.2 Employment act

It covers terms and conditions to be observed by employees and employer. It includes
contract of employment, termination of contract, and change of employer, working hours and
off days

4.5.3 Trade license act

It is obtained from the government officers or local authorities such as municipal officers- it
indicates that the business is legal and operates a legal business.

4.5.4 Factory industry act

The business will abide by the rules of factory and industry regulations

4.6 equipment or materials required for the business

S/NO EQUIPMENT
1. Mixing bowl
2. Scales
3. Pastry brush
4. Oven gloves
5. Baking tins
6. Wooden spoon
7. Measuring cups
8. Measuring jug
9. Forks
10. Knives

19
 CHAPTER FIVE: FINANCIAL PLAN
5.1 Pre-operational cost
ITEM COST
Rent 12,000
Electricity 1000
Electricity installation fee 5,000
Advertisement 8,000
Recruitment 5,000
Furniture and fitting 20,000
Equipment 200,000
License 14,000
Raw materials 50,000

TOTAL 318,000

5.2 working capital

BELLY’S GOLDEN BAKERY

WORKING CAPITAL FOR THE

YEAR ENDED 31ST DEC.

ITEM 2025 2026 2027 TOTAL

Cash at hand 80,000 50,000 100,000 230,000
Cash at bank 200,000 120,000 210,000 530,000
Debtors 90,000 100,000 130,000 320,000
Stock 210,000 250,000 200,000 660,000
Total current Assets 580,000 520,000 640,000 1,740,000

Creditors 130,000 180,000 150,000 460,000

Short term loan 100,000 200,000 170,000 470,000
Total current liability 230,000 380,000 320,000 930,000

Working capital 350,000 140,000 320,000 810,000

20
 5.3 CASH FLOW PROJECTION
BELLEY’S GOLDEN BAKERY CASH FLOW PROJECT FOR THE
YEAR ENDED 31ST DEC 2025.

MONTHS JAN FEB MAR APR MAY JUNE JULY AUG SEP OCT NOV DEC Total
Receipts in
Capital 50,000 50,000
Debtors 20,000 15,000 30,000 40,000 3000 5000 45,000 1000 35,000 30,000 15,000 12,000 260,000
Loans 20,000 20,000
Sales 80,000 105,000 197,000 100,000 180,000 170,000 100,000 160,000 90,000 120,000 140,000 170,000 1,612,000
D.Received 10,000 1,300 12,000 5,000 2,000 2,000 3,000 5,000 4,000 5,000 49,300
Total 160,000 141,300 239,000 140,000 188,000 175,000 147,000 163,000 128,000 155,000 159,000 187,000 1,942,000
Payments
Purchases 20,000 10,000 30,000 15,000 40,000 20,000 10,000 40,000 10,000 20,000 15,000 30,000 260,000
Creditors 2,000 5,000 20,000 3000 10,000 20,000 5,000 10,000 4,000 2,000 3,000 4,000 88,000
Salaries 86,000 86,000 86,000 86,000 86,000 86,000 86,000 86,000 86,000 86,000 86,000 86,000 1,032,000
Rent 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 144,000
Electricity 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 12,000
Loan 30,000 20,000 50,000
payment

21
Advertisem 2,000 2,000
ent
Insurance 2000 2,000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 24,000
Total 123,000 116,000 151,000 119,000 152,000 141,000 116,000 151,000 115,000 123,000 119,000 135,000 1,560,000
Cash flow 37,000 25,300 88,000 21,000 36,000 34,000 31,000 12,000 13,000 32,000 40,000 52,000 382,000
b/cd 37,000 62,300 150,300 171,300 207,300 241,300 272,300 285,300 298,300 330,300 370,300 384,000
b/cd 37,000 62,300 150,300 171,300 207,300 241,300 272,300 285,300 298,300 330,300 370,300 422,300 766,000

CASH FLOW PROJECTION

BELLEY’S GOLDEN BAKERY CASH FLOW PROJECT FOR THE YEAR
ENDED 31ST DEC 2026.
MONTHS JAN FEB MAR APR MAY JUNE JULY AUG SEP OCT NOV DEC Total
Receipts in
Capital 70,000 70,000
Debtors 20,000 15,000 20,000 17,000 10,000 20,000 12,000 8,000 3,000 7,200 10,000 20,000 162,000
Loans 50,000 50,000
Sales 110,000 140,000 150,000 200,000 160,000 180,000 187,000 150,000 170,000 150,000 130,000 190,00 1,917,000
0
D.Received 2500 3000 6000 3000 4,000 3000 5,000 3,000 2,000 3,000 5,000 10,000 40,000
Total 160,000 141,300 239,000 140,000 188,000 175,000 147,000 163,000 128,000 155,000 159,000 187,00 2,119,000
0

22
Payments
Purchases 50,000 20,000 30,000 50,000 40,000 37,000 60,000 40,000 20,000 15,000 18,000 30,000 410,000
Creditors 40,000 2,000 6,000 1000 5,000 3,000 10,000 7,000 5,000 1,000 3,000 4,000 51,000
Salaries 86,000 86,000 86,000 86,000 86,000 86,000 86,000 86,000 86,000 86,000 86,000 86,000 1,032,000
Rent 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 144,000
Electricity 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 12,000
Loan payment 30,000 30,000 30,000 30,000 120,000
Advertisement 2000 2,000
Insurance 2000 2,000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 24,000
Total 185,000 123,000 137,000 182,000 148,000 141,000 201,000 148,000 126,000 147,000 122,000 135,00 1,673,000
0
Cash flow 17,500 35,300 39,000 38,000 26,000 62,000 3,000 63,000 49,000 13,200 23,000 85,000 526,000
b/cd 422,300 439,800 474,800 513,800 551,800 577,800 639,800 642,800 705,800 754,800 768,000 791,00 1,282,000
0
b/cd 439,800 474,800 513,800 551,800 577,800 639,800 642,800 705,800 754,800 768,000 791,000 876,00 1,808,000
0

23
 CASH FLOW PROJECTION
BELLEY’S GOLDEN BAKERY CASH FLOW PROJECT FOR THE YEAR
ENDED 31ST DEC 2027.
MONTHS JAN FEB MAR APR MAY JUNE JULY AUG SEP OCT NOV DEC Total
Receipts
in
Capital 100,000 100,000
Debtors 10,000 7,000 12,000 8,000 20,000 15,000 13,000 10,000 18,000 20,000 10,000 15,000 149,000
Loans 50,000 50,000
Sales 150,000 130,000 160,000 140,000 170,000 190,000 170,000 160,000 150,000 170,000 180,000 210,000 1,980,000
Discount 1,000 3,000 2,000 2,000 1,000 4,000 3,000 2,000 4,000 2,000 2,000 3,000 31,000
received
Total 261,000 140,300 174,000 150,000 191,000 209,000 236,000 172,000 172,000 192,000 192,000 228,000 2,270,000
Payments
Purchases 80,000 30,000 30,000 20,000 15,000 30,000 40,000 30,000 20,000 30,000 20,000 60,000 405,000
Creditors 3,000 3,000 4,000 5,000 1,000 4,000 3,000 3,000 2,000 3,000 4,000 8,000 43,000
Salaries 86,000 86,000 86,000 86,000 86,000 86,000 86,000 86,000 86,000 86,000 86,000 86,000 1,032,000
Rent 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 144,000
Electricity 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 12,000
Loan 30,000 30,000 30,000 30,000 30,000 30,000
payment

24
D. allowed 2,000 1,500 1,000 3,000 2,000 800 1200 1000 2000 1000 2000
Insurance 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 24,000
Total 216,000 135,500 166,000 129,000 149,000 135,000 174,800 135,200 154,000 136,000 156,000 171,000 1,660,000
Cash flow 45,000 4,500 8,000 21,000 42,000 74,000 61,200 36,800 18,000 56,000 36,000 57,000 619,000
b/cd 876,000 921,000 925,500 933,500 954,500 996,500 1,070,50 1,131,500 1,160,700 1,186,50 1,242,50 1,278,50 2,427,000
0 0 0 0
b/cd 921,000 925,500 933,500 954,500 996,300 1,070,50 1,131,70 1,168,500 1,186,500 1,242,50 1,278,50 1,335,50 3,046,000
0 0 0 0 0

25
 5.3.1 Quarterly cash flow projection
QUARTERLY CASH FLOW PROJECTION BELLY’S GOLDEN BAKERY FOR THE
YEAR ENDED 31ST DEC 2025.

MONTHS JAN-MAR APR-JUN JUN-SEP OCT-DEC TOTAL

Receipts in
Capital 50,000 50,000
Loans 20,000 20,000
Debtors 65,000 48,000 90,000 57,000 260,000
Sales 382,000 450.000 350,000 430,000 1,612,000
Total 517,000 498,000 440,000 487,000 1,942,000

Payments

Purchases 60,000 75,000 60,000 65,000 260,000

Creditors 27,000 33,000 19,000 9,000 88,000
Salaries 258,000 258,000 258,000 258,000 1,032,000
Rent 36,000 36,000 36,000 36,000 144,000
Electricity 3,000 3,000 3,000 3,000 12,000
Insurance 6,000 6000 6000 6,000 24,000
Total 39,000 409,000 382,000 377,000 1,560,000

Cash flow 127,000 89,000 58,000 110,000 382,000

b/cd 127,000 216,000 274,000 384,000
b/cd 127,000 216,000 274,000 384,000 766,000

26
 QUARTERLY CASH FLOW PROJECTION BELLY’S GOLDEN BAKERY FOR THE
YEAR ENDED 31ST DEC 2026.

MONTHS JAN-MAR APR-JUN JUL-SEP OCT-DEC TOTAL

Receipts in
Capital 70,000 70,000
Loans 50,000 50,000
Debtors 55,000 47,000 23,000 37,200 162,000
Sales 400,000 540,000 507,000 470,000 1,917,000
Total 525,000 587,000 580,000 507,000 2,199,000
Payments
Purchases 100,000 127,000 120,000 63000 410,000
Creditors 12,000 9,000 22,000 8,000 51,000
Salaries 258,000 258,000 258,000 258,000 1032,000
Rent 36,000 36,000 36,000 36,000 1,441,000
Electricity 3,000 3,000 3,000 3,000 12,000
Insurance 6,000 6000 6000 6,000 24,000
Total 415,000 439,000 445,000 374,000 1,673,000
Cash flow 110,000 148,000 135,000 133,000 526,000
b/cd 766,000 846,000 1,014,000 1,149,000 1,282,000
b/cd 866,000 1,014,000 1,149,000 1,282,000 1,808,000

27
 QUARTERLY CASH FLOW PROJECTION BELLY’S GOLDEN BAKERY FOR THE
YEAR ENDED 31ST DEC 2027

MONTHS JAN-MAR APR-JUN JUN-SEP OCT-DEC TOTAL

Receipts in
Capital 100,000 100,000
Loans 50,000 50,000
Debtors 29,000 43,000 32,000 45,000 149,000
Sales 440,000 500,000 480,000 560,000 1,980,000
Total 560,000 543,000 562,000 605,000 2,279,000

Payments

Purchases 140,000 65,000 90,000 110,000 405,000

Creditors 10,000 10,000 8,000 15,000 43,000
Salaries 258,000 258,000 258,000 258,000 1,032,000
Rent 36,000 36,000 36,000 36,000 144,000
Electricity 3,000 3,000 3,000 3,000 12,000
Insurance 6,000 6,000 6,000 6,000 24,000
Total 453,000 378,000 410,000 428,000 1,660,000

Cash flow 116,000 165,000 161,000 177,000 619,000

b/cd 1,808,000 1,924,000 2,089,000 2,250,000 2,427,000
b/cd 1,924,000 2,089,000 2,250,000 2,427,000 3,046,000

28
 5.4.1 INCOME STATEMENT
STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 31ST
DEC.
2025 2026 2027
Items Sh sh total sh sh total sh sh total
Sales 1,612,000 1,917,000 1,980,000
Less return 30,000 1,582,000 40,000 1,877,000 35,000 1,945,000
sales
Opening 210,000 250,000 200,000
stock
Add 260,000 410,000 405,000
purchases
Add 10,000 9,000 11,000
carriage
inwards
480,000 669,000 616,000
Less 10,000 21,000 15,000
purchase
returns
Cost of 470,000 648,000 601,000
goals
Available
for sales
Less closing 120,000 350,000 150,000 498,000 70,000 531,000
stock
Gross profit 1,232,000 1,379,000 1,414,000

Expenses
Transport 7,000 10,000 12,000
Electricity 12,000 12,000 12,000
Bills 36,000 55,00 34,000 36,000 60,00
Net profit 1,177,000 1,354,00

29
 5.4.2 BALANCE SHEET
BELLY’S GOLDEN BAKERY STATEMENTOF FINANCIAL POSITION FOR THE
YEAR ENDED 31ST DECEMBER
ITEM AMOUNT(KSH) TOTAL(KSH)
Fixed assets
Equipment 120,000
Machinery 200,000
Furniture 20,000 340,000
Current assets
Stock 150,000
Debtors 40,000
Pre-payment 5,000
Cash at hand 100,000
Cash at Bank 350,000 645,000
Current liabilities
Creditors 51,000
Short term loan 200,000
Bank overdraft 100,000 351,000
Capital employed 634,000
Financed by
Capital 100,000
Loan 134,000
Net profit 400,000

30
5.5 CALCULATION OF BREAK-EVENT POINT
B.E.P =Fixed cost/contribution

Contribution margin =sales – variable cost

Unit selling price =102/=
Unit variable cost =74/=
Contribution =sp-vc
Contribution =(102-74) ksh =28/=
UNIT 0 1000 2000 3,000 4,000 5,000
COST
Fixed cost 101,000 101,000 101,000 101,000 101,000 101,000
T.cost 0 60,000 120,000 180,000 240,000 300,000
T.cost 101,000 161,000 221,000 281,000 341,000 401,000
Sales 0 100,000 200,000 300,000 400,000 500,000

31
5.6 CALCULATION OF PROFITABLE RATION
RATIO FORMULAR CALCULATION
Gross profit GPR 1,232,000 X 100/1,612,00
Gross profit x 100/sales 76.4%
Net profit NPR 1,177,000 X 100/1,612,000
Net profit x 100/sales 73%
Return profit ROQ 1,177,000 X 100/2,050,000
Net profit x 100/Capital 53%
Current ratio CR 580,000/230,000
Current assets-stock /current liabilities 2.52%
Quick ratio QR 580,000-210,000/230,000
Current assets-stock/current liabilities 370,000/230,000
1.61%
Stock turn ST= 120,000/
average Closing stock/average stock ½(210,000X120,000)
A.s =opt closing stock/2 =120,000/270,000
0.44%

5.7 DESIRED FINANCING

The proposed business require a total of ksh.1,108,000 to start. This is expected to fiancé
the activities below.
S/N ACTIVITIES AMOUNT KSH
1 Pre-operational costs 318,000
2 Working capital 350,000
Fixed assets 340,000
Expenses 100,000
Total stsrt up capital 1,108,000

32
5.8 PROPOSED CAPITALIZATION
ITEMS AMOUNT
Pre-operational cost 318,000
Working capital 350,000
Fixed assets 340,000
Expenses 100,000
Total investment 1,108,000
Finance by
Owner’s savings 328,000
Kcb bank 150,000
Co-operative loan 500,000
Donation 130,000
TOTAL 1,108,000

33
APPENDIX
Homabay Town
Homabay primary Governor’s office

Belly’s
Golden
Bakery Tom
Homabay referral
Homabay high school Mboya
Rodi
University
Hospital

34