BUSINESS PLAN

A BUSINESS PLAN SUBMITTED IN PARTIAL FULFILLMENT OF CERTIFICATE IN

BUSINESS MANAGEMENT.

NAME OF THE BUSINESS: VIKINGS CONSTRUCTION LIMITED

ADDRESS: P.O BOX 19061-NAIROBI

EMAIL: [email protected]

TELEPHONE NO: +254746695759

NAME 0F THE SUBMITTER: AHMED ABDIAZIZ MOHAMED

SUBMITTED TO: KIDS TECHNICAL COLLEGE

DATE OF SUBMISSION: 25TH.NOV.2020

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 DECLARATION

I hereby declare that this business plan is my original work. I also affirm that it has not been
presented to this institution or any other college for academic purposes, or for any purpose.

NAME : AHMED ABDIAZIZ MOHAMED

ADMIN NO :

SIGNATURE :

DATE :

SUPERVISOR`S NAME :

SIGNATURE :

DATE :

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DEDICATION

I dedicate this business plan to my family and my friends for their full support may it be
financially, morally and spiritually. You all gave me a reason to study hard.

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ACKNOWLEDGEMENT

I am very grateful to the almighty Allah for giving me good healthy, guidance and the strength to
do this business plan work. My sincere thanks also go to my parents for their financial, social
and moral support during writing this business plan and all the time.

I also appreciate my supervisor and my friends for their full support when I needed anything.

May Allah bless you all.

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 CONTENTS

DECLARATION…………………………………………………………………………….. 3

DEDICATION…… ………………………………………………………………….. 4

ACKNOWLEGEMENT……………………………………………………………………. 5

CHAPTER ONE ……………………………………………………………………………. 8

1.0 EXUCUTIVE
SUMMARY………………………………………………………………………. 8
1.1 BUSINESS DISCRIPTION………………………………………………………. 8
1.2 BUSINESS LOCATION………………………………………………………… 8
1.3 FORM OF OWNERSHIP……………………………………………………….. 9
1.4 PRODUCTS AND SERVICES………………………………………………… .9
1.5 JUSTIFICATION OF OPPORTUNITY………………………………………..10
1.6 INDUSTRY………………………………………………………………….. 10
KEY CHARACTEISTICS OF THE INDUSTRY……………………….………13
1.7 BUSINESS OBJECTIVES, MISSION AND VION……………………………14
1.8 INTERNAL ASSESSMENT………………………………………………….. 15
1.9 GROWTH AND ENTRY STRATEGY…………………………………… 16

CHAPTER TWO………………………………………………………………… 17

2.0 MARKETING PLAN……………………………………………………………. 17

2.1 TARGET CUSTOMERS………………………………………………… 17
2.2 MARKET SHARE…………………………………………………………….18
2.3 COMPETITION……………………………………………………………….18
COMPETION ANALYSIS………………………………………………….19
2.4 ADVERTISEMENT AND PROMOTION STRATEGIES………………….20
2.5 PRICING…………………………………………………………………………. 21
2.6 SALE TACTICS………………………………………………………………… 22
2.7 DISTRIBUTION……………………………………………………………………..22
2.8 CUSTOMER SERVICES………………………………………………………..22

3.0 ORGANIZATION AND MANAGEMENT…………………………………….…….. . 21

3.1 QUALIFICTIONS, DUTIES AND RESPONSIBILITY…………………………..23
3.2 RECRUITMENT…………………………………………………………….. 26
3.3 TRAINING……………………………………………………………………… 26
3.4 PROMOTION……………………………………………………………………. 27
3.5 REMUNERATION AND INCENTIVES………………………………………… 27

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 3.5.1 REMUNERATION………………………………………………….. 27
3.5.2 INCENTIVES……………………………………………………….. 28
3.6 LICENSE AND PERMITS………………………………………………… 28
3.7 SUPPPORTIVE SERVICES………………………………………………….29
3.7.1 BANKING SERVICES…………………………………………..... 29
3.7.2 INSURANSE SERVICES……………………………………………30
3.7.3 LEGAL SERVICES…………………………………………………30

CHAPTER FOUR………………………………………………………………………31

4.0 PRODUCTION AND OPERATION PLAN…………………………………............31

4.1 PRODUCTION OBJECTIVES………………………………………………….31
4.2 PRODUCTION FACILITIES………………………………………………… 32
BILL OF QUANTITY………………………………………………….… 32
4.3 PRODUCTION STRATEGY…………………………………………......... ….. 32
4.4 MONTHLY HEAD EXPENSES…………………………………………… 33
4.5 PRODUCTION PROCESS…………………………………………………..... 33
4.6 REGULATIONS AFFECTING OPERATIONS………………………………… 34
4.7 OPERATION TABLE/PRODUCTION SCHEDUL………………………… 34

CHAPTER FIVE……………………………………………………………………… 35

5.0 FINANCIAL PLAN…………………………………………………………………… 35

5.0.1 PRE-OPERATION COST…………………………………………………… 35
5.1 WORKING CAPITAL……………………………………………………… 36
5.2 PROJECT INCOME STATEMENT…………………………………………… 36
5.3 PROJECT STATEMENT OF FINANCIAL POSITION……………………… 37

CHAPTER SIX………………………………………………………………………38

6.1 RISK MANAGEMENT……………………………………………………….38

6.2 DEFINITION OF RISK……………………………………………………………..38
6.3.1 RISK IDENTIFICATION……………………………………………………38
6.3.2 RISK EVALUATION………………………………………………………..38
6.3.3 CHOOSING DEVICE OF HANDLING…………………………………….39
6.4 TYPES OF RISK……………………………………………………….39
6.4.1 FINANCIAL ASSETS…………………………………………..39
6.4.2 ECONOMIC RISK……………………………………………….39
6.5 HOW TO HANDLE RISK………………………………………..40

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 CHAPTER ONE

1.0 EXUCUTIVE SUMMARY

1.1 BUSINESS DESCRIPTION

The business will operate under the Vikings Construction limited and is dealing with
construction of buildings, bridges and so many other services needed.

1.2 BUSINESS LOCATION

Vikings construction limited is located at V-building near KCB bank CBD branch in Nairobi
town. We chose Nairobi town because Nairobi is considered to be the best place in the country
for a construction permit.

Business address:

VIKINGS CONSTRUCTION LIMITED

P.O BOX 19061-NAIROBI

TELEPHONE NO: +254746695759

EMAIL : [email protected]

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 1.3 FORM OF OWNERSHIP

Vikings construction limited is a startup company that will go into the business in this year.
Starting up a business is always difficult and has its own challenges thus a construction company
like this.

I chose to start in many reasons but mainly to follow my passion and feel proud of something of
my own. One of the advantages is a team culture employees are attracted to high/huge salaries
and they easily lose sight of the company vision and but startup employees form a close-knit
community that shares passion, beliefs and values. They work together for the good of the
company and the customers as well.

Vikings construction limited is incorporation ownership.

Advantages of incorporation are:

 Limited liability- the owners of corporation are only liable up to the amount of their
investments. The corporate entity shields from any further liability.
 Perpetual life- there’s limit to the life of corporation since ownership of it can pass
through many generations.

1.4 PRODUCTS AND SERVICES

Vikings Construction Limited offers comprehensive services designed that allows the company
to do whatever it takes to finish a project. Some of these are; design work, remodeling and
alterations, permitting, site preparations, cement foundation, pointing and utility installations. In
addition to that, skills Vikings construction limited lacks can be subcontracted.

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 1.5 JUSTIFICATION OF OPPORTUNITY

The main reason led to implementation of this business is because there`s high demand of
constructions all over the country. This thought or perception made the company to come up
with the construction business. The aim of the business is to make and provide the customers
with modern constructions which are affordable.

1.6 INDUSTRY

Vikings Construction Limited falls under construction industry.

Infrastructure industry being the central pillar of Kenya`s 2030 vision. The infrastructure
development is among the strong holds and rapid growth in population which has led to soaring
demand for housing in most parts of the country present major opportunity for the construction
companies.

THE INDUSTRIAL TRENDS AND PROSPECT

Kenya is the most developed country in east Africa region and the middle class is growing
rapidly creating opportunities for housing. Business in tourism has increased significantly in
Kenya creating the need for more accommodation facilities. These are a need for investment in
affordable hotel. Accommodation facilitates that are up to standard with the rest of the world.
Low cost project remains the eternal gap in the market as potential demand is huge. However
due to the absence of good infrastructure in many parts of the country the costs and therefore
sale prices of this projects are such that the homes are not really affordable for the target market.
The security issues also have created difficulties in leaving in some areas of the country due to
fears of attacks. Technology has been a great challenge to the real estate sector too, technology is
dynamic and as we know it changes within a very short time as a matter of fact this technology
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has kept sector on its toes since the sector is left with no choice but to change with the
technology though it is very expensive to go by. Despite this technology having its demerits it
has its merits too. It has propelled the sector to great heights in terms of service rendering and
products producing. According to the statistics and if the statistic is something to go by then I
can say the real estate sector has been growing from year to year. Many forms have been created
in Nairobi and in other parts of the country giving the sector the privilege of being among the
sectors that are rapidly growing in the country.

In provinces in which real estate investments are situated, the survey shows that Nairobi has the
most popular investment destination having 43% companies while North Eastern has the least
count of 1%.
REAL ESTATE FIRMS IN EACH COUNTY.

This pie chart above shows the number of real estate companies are distributed all over the
country especially in the eight provinces. Among the 8 provinces Nairobi is the biggest with the
number of the real estate farm being 42.6% followed by coast which has 16.7%, Central 12%,
Eastern 10.2%, Rift valley 9.3%, Nyanza 4.6%, Western 3.7% and finally North eastern 0.9%.

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Real estate growth in Kenya from 2016 to 2020

The curve above shows that the farm is growing by

at least 10% each year e.g. in 2016 the business
registered a growth of 10 percent. The curve shows
the growth rate.

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Key Characteristics of the Industry

Anyone setting up a company needs to start by investing money in the project you need to find
out how much you need to invest by planning capital requirement and that is what is the business
is putting much attention on as it prepares to venture into the market.

Capital requirement is a key plan especially if the business is planning or needs to apply for
government or assistance or for a bank loan. Real Estate Construction industry is planning to get
some of its funds from bank loans and government and that is why it has to do a lot of
through planning of the capital.

The following are the cost which might accrue during the business preparation for the lunch.

1. Consultancy costs

2. Notaries fee

3. Operational expenses for goods

4. Vehicle and offices expenses

5. Machines and buildings cost

6. Staff salary

Fixed costs- They are costs that you will incur in the operation whether you are creating the
profit or not they include;

Insurances, loans payment and lease or rent payment equipment inventory and owner income
are also included.

The business will incur variable costs-they are substantially from month to month and are based
on the usage, they include advertising, delivering and shipping charges also utilities and
employment ways are included.

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 1.7 BUSINESS OBJECTIVES, MISSION AND VISIONS

Every company or business has objectives, mission and visions which helps the business to be
focused and have goals to achieve .objectives helps the company to move on track and it is easy
for the company to assess its success as per the achievement it has made.

Objectives

The business objective is to build a lot of residential and social halls up to 40% 2021 by making
the house affordable and modern.

The enterprise will strive employment opportunity to the owner and other members of the
community who will need work.

Goals

To complete a quarter of the business intended to be projected within the first 1 year to asses
commitment.

To improve the quality of constructions in the region.

To build different types of houses that is affordable to the customers.

Mission

To be the best company that can create and design attractive homes to our customers. This is by
having the best engineers and designers who are experienced to do their jobs.

Vision

The business wants to expand regionally and make itself popular in Eat Africa by marketing it
and constructing buildings that are standard and modern.

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 1.8 INTERNAL ASSESSMENTS

I. Strength

The location where the business is taking place has good climatic history. It is not dry neither is
too wet, it is accessible with both electricity and water.

The security is good since it is located near a police station.

The technology has also boosted the project by making it simple and easy to be done. The project
has available market.

II. Weakness

The big challenge facing the project is capital; capital is limited due to many requirements
involved in starting up the project also the limited human resources acts as a barrier to the
accomplishment of the projects.

III. Opportunities

The project has numerous opportunities since it is entitled to expansion with the rising demands
of residential houses.

The government has also thrown weight behind the sector by encouraging the industry to
continue with its project.

IV. Threats

The field has numerous people and companies who bring about a lot of competition. This
competition can range from the quality of products to the price of the product.

This has pushed many companies to deep dip into their pockets in order to attract the attention
of the customers and remain top.

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 1.9 GROWTH AND ENTRY STRATEGY

Entry strategy

Entry strategy is very important for any business which wants to venture into the market, the
strategy helps the developer to have some tactics that will guide him in monitoring how
the business is doing and how to enter the market. The enterprise will begin operating in the
month of January 2021.

These are some of the business strategies; The advertising methods during this period and other
subsequent periods will be through posters, stickers, journals and use of employees and
customers as sales representatives.

Growth

For an enterprise to expand there must be growth in the business. A business is termed successful
when it grows in terms of size and profit income.

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 CHAPTER TWO

2.0 MARKETING PLAN

2.1 TARGET CUSTOMER

Vikings Construction Limited will have many customers to sell its products to.
The business is targeting the customers around the city and others from the
country. The houses built along Deniss Pritt road are targeting customers from Kilimani. These
are mostly foreigners who are from different countries and want to reside around the area.

The business is expected to hold a market share of 15%initially but it is expected to rise to 25%
as operations and construction continues. Vikings Construction will rely on the use of radios,
television set, magazines and stickers as well as billboards and newspapers to have a big market
share. It is interested to note that both locals and international media will be used to advertise for
the presence of our products.

The business will strive to have a competitive pricing system whereby only high and
moderate prices will be offered to the customers, the business will ensure this by making sure it
deals with the customers directly without using middlemen

The business will have both commercial and individual and as a matter of facts the Company
plans to build low, middle and high class constructions. The business decided to do business with
both individuals and commercials so that no one should feel left out; this will also increase the
market share of the business, if the enterprise serves a number of customers in the forms of
individual, groups of individuals, institutions, government departments and other social
organization.

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2.2 MARKET SHARE

The business intention is to grow by 15% and later to have an increase in market share of up to
25%. Despite all these plans the business has got a lot of competition.

The competitions are both from within the region and outside the region.

2.3 COMPETITION

The following enterprises will be expected to compete alongside Viking Construction Limited.

1- Shah and sons Construction Company

This is a construction company situated next to Kabete Campus. It was opened in the year 2014
and has been in operation for a quite some time now. It offers high quality products and services
and has expertise management who are capable of making sound decisions. It has the most
modern machines and equipment for constructions.

2- Classic Homes Company

This construction company is situated along Thika road it is famous and therefore has a lot of
market and labor force. It has been in operation for over five years. Though it is famous the
enterprise charges are very high and their products are of high quality.

3- Patel house dealers

The company is owned by Patel`s family. It does not build any houses but offers services in
repairing and doing other house related productions. It has a very special financial base and has
large and loyal customers who are ready to abide by its standards of operation .it offers
moderate prices for its services but suffers from employee dissatisfaction credibility

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 COMPETITION ANALYSIS TABLE

Competitor Strength Weakness

Patel house  They have special finance  They suffer the
dealers base weakness of employee
 They have loyal customers dissatisfaction
 Their products are of
moderate prices
Shah and sons  Offers quality products  It has a poor customer
construction  Good expertise and public relations
management
 It has all the modern
equipment

2.4 ADVERTISEMENT AND PROMOTION STRATEGIES

Advertising is trying to persuade people to buy a product or a service by announcing on the

internet, on the television and in newspapers. The business needs to be advertised to attract the
customers and to be recognized by the public which help the business to be much known
to people

The Company will use a host of media to advertise and promote its products and services to
the customers. The use of a radio as mean of advertising and promotion will be of great use to
the company. Both the locals and international broadcasting Medias will be asked to assist in the
advertising and promoting the activities of the business.

The Kenya Broadcasting Corporation (KBC), the Citizen Radio Station and the Nation
Radio Station will be used. Also the use of newspaper and magazines will be maximized in
advertising
and promoting the products of the business. The specific newspapers that the enterprise intends t
o use are; the standard, the Daily Nation and the Parents Magazine.

Posters, stickers and letters will be also used to advertise the goods and services of then
Company. The posters will be printed and posted at all strategic points in Nairobi town and other
places.

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On other hand the stickers will also be produced and distributed to as many vehicles as possible,
the car owners will have them free of charge.

Promotion- This is a process of attracting people’s attention to your event, product etc.

It can be done through reduction of prices or giving free product after the customer has bought
either one or more products

2.5 PRICING

At the beginning of the business operations the business will have to operate with normal prices
despite the high startup costs and operation.

The nature of the pricing will depend on fundamental business factors, the cost of service, the
quality of the product and services and the nature of product to be solved will be the main
determinants. With high cost of services and products the price might be forced to hike, while
with the low price of the product the price will be low.

The market price at which the goals and services are currently charged will also be another
determinant that is if the products in the market are expensive than the price will rise but if
the price of the products are low than the price will lower.

The table below is for price list of individual customers

Products Price per product [KSH]

Single room 3500
Self-contained house 5200
Family living house 11500

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Social hall 20000

The table below is the pricable for commercial customers

Product Price Discount % Price per product

[KSH]
Social hall 20000 20 (80*200000)/100=1600
Single rooms 3500 10 (90*3500)/100=3150
Self-contained 5000 25 (75*5000)/100=3750
Family house 11500 30 (70*11500)/100=8050

2.6 SALE TACTICS

The business will use a host of instrument to sell itself and its products.

There will be advertisement placed in newspapers journals and poster. In addition the employees
and customers will be used as sales representatives. The enterprise will also engage a public
relation firms as means of promoting its activities and familiarizing itself with the public.

The use of stickers and other publications to sell the business and its product will be undertaken
as a very large scale. Therefore inured to sell itself and the products. The Company will use
advertisements personal selling and public relation and also publicity.

2.7 Distribution

In order to deal with its customers properly, the business will try to deal directly with customers.
This means there will be no middlemen to connect the business with the customers. This kind of
strategy will ensure direct assessment of the needs and aspirations of the customers by

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the proprietor. As well it has the potential to limit communication expenses and other
core problems associated with consumers’ relationship management

The business will encourage scenario where customers are free to contact the owner at any time
and vice versa.

2.8 Customer service

The business intends to attract its customers by providing quality products better than those of
our competitors. We shall advertise our services and products to make it well known to
everyone.

Customers will be given different services ranging from house repair, free delivery of their goods
to their new homes and also installation of their home applications will be done free of charge.

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 CHAPTER THREE

3.0 ORGANIZATION AND MANAGEMENT

The management team will consist of the general manager marketing managers and chief
engineering manage. They will ensure all their departments are in order and running efficiently
as required to enable smooth operation of the business activities.

This management team will be highlighted as

1. General Manager

2. Marketing manager

3. Chief engineer manager

3.1 DUTIES AND RESPONSIBILITY

Job title Qualifications Duties Responsibility

General manager  Holder of  To evaluate  To provide funds
degree in employees for running
civil  To control and business
engineering oversee all the  To manage the
and business affairs of the
business activities business
administrati  To undertake all  To evaluate the
on matters to do business growth
 Proper with the and performances
knowledge adminstration  Organizes and
to make coordinates the
sound operation of the
decision business
 Should have
general
business
managemen
t skills

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  Should be
of age 30
and above
Chief engineer  Should have  To come up  Assigning work to
a degree in with best design other employees
both  Ensure the  Will be inspecting
construction products of the the projects started
engineer company are up by the business for
and to required safety reasons
information standard  He will also be
communicat expected to inspect
ion his junior engineers
technology
from a
recognized
university
in Kenya
 Should have
ability to
make
complex
decision
 Should be
the age of
25 and
above
Architecture  Holder of  Drawing well  Can undertake any
diploma in designed other duty as many
drawings projects be assigned
and designs  Explaining all  Be able to cope
 2 years of the drawing with all kinds of
working details to the drawings and
experience aimed patties designs demanded
 Ability to  Shaping by his employees
work long drawings into
hours different sizes
 Can draw 2- and designs
3 plans a
day
Marketing manager  Holder of a  Planning the  Communicating
diploma in enterprises with the customers
sales and operations and  Publicizing the
marketing activities business products
Land surveyor  Diploma in  Advertise the  Undertakes the
civil company on the services of repair
engineering sites of and maintenance of
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  Three years construction the land
of  Check whether
experience the site has all
 Ability to the important
attend and features for
work long construction he
hours inspects the land
Constructing  Should have  Commitment  To carry out the
6 months of during working work as provided
experience hours by your seniors
 Ability to
work for
long hours

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3.2 RECRUITMENT

This is the process to get someone to work in the company or join an organization. The function
of recruitment at the center will be undertaken by the manager with the assistance of the
marketing manager, the potential candidates will have to be identified and then contacted
through either the existing employees, customers or the advertisement. The reasons we use
advertisement is because it is1)

1- Cheap - It is not costly as compared to other methods

2- It is popular -the adverts are accessed by many people

3- It can take long before it gets invalid depending on the customer.

The candidates will then be invited for selection where the testing method will be the
most preferred means.

The management of the enterprise will have to get employees from existing construction firms
around and outside the region that will have had the experience needed to work effectively.
These will then be converted to proper workers with the very great perquisites that can
make them work at the center.

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3.3 Training

Training is the process of teaching someone to do a particular job or activity.

The enterprise will offer short courses for the employees and other stake holders who may be in
need of the information about the various features in our firm specifically the employees will be
encouraged to undertake courses in construction, machine maintenance and embracing of the
new technology in the construction sectors and workshop management practices.

3.4 Promotion

Promotion is a process of attracting people’s attention to an event.

All the positions with the exception of the general manager will be held on temporary basis.
This therefore, means that promotion opportunities for all the employees In this regard the
enterprise will strive to make the employees conformed through the use of other means and
instruments like providing meaningful work, allowing the employees the freedom to undertake
their own activities without unnecessary hindrance.

3.5 Remuneration and incentives

3.5.1 RUMENARATION

Remuneration is increasing the employee’s salary to improve their working morale.

There will be straight salary of all in the position of the employees in the business. The
skills being possessed by the employee and the nature of duties undertaken by the employee at an
y single time in the work place. For instance the chief engineer will earn more than all other
employees, by this position of being second in the business hierarchy, while the constructors will
earn less than any other employees in the center.

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 3.5.2 INCENTIVES

In attempts to improve the performance of employees, the business will install a range of
strategies. There will be a piece work system of servicing whereby the employees will be
enumerated according to the piece of work they produced within a given rate of payment.

The profits and other gains made by the center will also be shared between the manager and the
other employees.

The various welfare services and other benefits will equally be provided by the business
in pursuit of the comfort of its employees. The employees will also be given the chances to partic
ipate in the decision making process within the business. This will likely inspire the performance
of the employees in terms of productivity efficiency and effectiveness.

Category of Basic salary Allowances Total remunerations

employees
General manager 100,000 20,000 120,000
Chief manager 85,000 20,000 105,000
Architectures 70,000 15,000 85,000
Marketing manager 70,000 10,000 80,000
Land surveyor 70,000 10,000 80,000
Instructor 50,000 8,000 58,000
Constructor 25,000 5,000 30,000

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3.6 LICENSE AND PERMITS

Before the beginning of its operation the enterprise will require the permit from the Ministry of
Trade and a license from the City Council of Nairobi.

These documents will be renewed when required, for instance by laws of the city council in
regards to working hours, hours will have to be adhered to and worked upon as the basis on
which the operation of the business will be enhanced.

Waste disposal by laws as formulated by the city council of equally determine the operation of
the enterprise.

3.7 Supportive services

In its operations the business will need several services so as to effectively undertake its key and
subsidiary objectives.

The following services will be sourced from outside firm

3.7.1 Banking services

These will be needed to keep excess funds and advices on the best way of undertaking future
investment. The enterprise will be in liaison with the Kenya commercial bank.

Coop Bank,

P.o Box 7789, Nairobi.

Tom Mboya avenue branch

Telephone :0720345555

Email :[email protected]

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 3.7.2 Insurance services

The business will have to source for insurance services from the Madison insurance
company, Nairobi branch. both the business premises products and personnel will be in
insured against any risks or dangers

Madison Insurance co.

P.o Box 0007211,

Nairobi

Telephone 0012770774

Email; [email protected]

3.7.3 Legal services

The business will have to prepare legal document and at time seek to be represented in a
court when there is a case of whatever nature especially when entering into business
contracts, the finer details required in the execution of contractual obligations and the
consequences associated with the non-compliances of work with Rotich and company
advocates that will help it transact its business in the region.

Rotich and company

P.o Box 459980

Nairobi

Telephone : 0722613791

Email : [email protected]
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 CHAPTER FOUR

4.0 PRODUCTION AND OPERATION PLANNING

4.1 PRODUCTION OBJECTIVES

Vikings Construction Limited has some objectives related to producing products. First the
business has a plan to produce more goods or products as compared to the customers demand.
The business also has a plan to build constructions that can withstand any kind of catastrophe.
This includes earthquakes and thunderstorms. The main reason to build such strong houses is to
ensure our customers are safe in all kinds of weather and avoiding any fatal case of the above to
occur.

4.2 PRODUCTION FACILITIES AND CAPACITY

Facilities will be provided in abundant to enable smooth running of the business. The business is
also planning to offer facilities for young children and people with special needs and many more.
By doing so the Company will be more famous and will be considered to be serving every
member of the community or people from different walks of life irrespective of their disabilities,
status and gender.

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 BILL OF QUANTITY

ITEMS QUANTITY DESCRIPTION SUPPLIER UNIT TOTAL

PRICE COST
Bricks and blocks 200 lorries No1 Block miners 50,000 10,000,000
Building 150 piles Any Insulator 5,000 750,000
insulations manufactures
Plywood 115 piles Wood cutters Wood cutters 500 57,500
Switches 300 sachets Smart switch 50 15,000
Metal fabrication 20 tins Metal care 200 4,000
Electric wire 500 meters Any Any 45 22,500
Metals 700 rods 150 105,000
Structural steel 200 pieces Any Any 50 20,000
Wood finishing 15 tins Kingstone 30 450
finisher
Plastic pipes and 200 pipes Teepee Teepee 70 14000
fire stop
Aggregates 25 lorries Any Any 1,000 250,000
Sandstone 15 lorries 7,000 105,000
Window frames 700 Jua kali frames 200 140,000
cement 100 bags Bamburi cement 500 50,000

4.3 PRODUCTION STRATEGY

The production strategy will be put in place to make sure the business does not run out
of products or stock. The strategy will be effective as soon as the business products are
introduced into the market.

To make sure the stock lasts, Vikings Construction Limited will ensure construction of all sorts
of houses will be taking place every day as long as our products are having a good share in the
market and attractive to the customers all over.

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Vikings Construction Limited will also buy more land to make sure it has enough sites of
constructions in future. This will prevent the business from reducing its pace of constructions
due to lack of enough land.

4.4 MONTHLY OVERHEAD EXPENSES

ITEM MONTHLY COST

Water 12,000
Electricity 27,000
Security 10,000
Garbage collectors 2,000
Internet 7,000
DSTV 8,400
Maintenance 5,000
TOTAL 134,000

4.5 PRODUCTION PROCESS

The product production will be carried out only after the product has been well analyzed by
the business analyzing team and have met the required standard to be now introduced to the
market.

The production process itself shows how our products are being processed these are the
constructions that will be taking a period of 7 months to be built and 3 months to do all the
required
finishing before they are ready to be used by the customer both for renting and buying process .th
is includes safety measures.

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 4.6 REGULATIONS AFFECTING OPERATIONS

The servicing and operation function at Vikings limited will be affected or constrained by a
number of factors which will comprise of a

4.7 OPERATION TABLE/PRODUCTION SCHEDULE

ACTIVITY WHEN TO BE WHO IS TO BE WHAT TO BE DURATION

DONE DONE DONE OF ACTION
RECRUITMENT IT WILL BE MANAGER INTERWIEW 2 WEEKS
OF THE STAFF DONE AFTER SHOERT
EVERY 6 LISTING
MONTHS
TRAINING IT WILL BE CIVIL LEARNING 2 WEEKS
TAKING ENGINEER NEW
PLACE AFTER TECHNOLOGY
EVERY 2
YEARS

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 CHAPTER FIVE

5.0 FINANCIAL PLAN

Vikings construction limited will have to draw up financial statements after the end of every
year. The statistic from this financial document will be of help especially when the business
wants to determine the effectiveness of the business operations. The profit obtained from
the business operation will be invested in other more important activities for the benefit of the
owner.

In addition to that most important areas will be much more looked into and these are significant
documents to be constructed after every trading period, they include balance sheets, income
statement, working capital, cash flows and among others.

5.0.1 PRE-OPERATION COST

ITEMS COST
Business registration 30,000
License fee 25,000
Electricity connection 30,000
Water installation 10,000
Machines and equipment 1,000,000
Feasibility analysis fee 50,000
Stationary 15,000
Travelling and transport 27,000
Communication 7,000
Fixed assets and acquisition 700,000
Repairs and maintenance 19,000
Office computer 150,000
Office stamps 320
Reception seats 38,000
Tractors 3,700,000
Security 16,000

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 Insurance 20,000
Salary and wages 400,000
Padlocks 16,000
TOTAL 6,253,320

5.0.2 WORKING CAPITAL

ITEMS 1ST YEAR 2ND YEAR (4%) 3RD YEAR (6%)

Stock 500,000 520,000 530,400
Debtors 200,000 208,000 212,000
Cash at bank 1,000,000 1,040,000 1,060,000
Cash in hand 100,000 104,000 106,080
Prepayments 20,000 20,800 22,416
TOTAL 1,820,000 1,892,800 1,930,496
CURRENT

5.1 PROJECT INCOME STATEMENT

On 31st .Dec, (2021, 2022, 2023)

ITEMS 2021 2022 2023

Sales 7,000,890 1,000,990 1,500,000
Cost of sales 3,000,043 6,874,992 4,010,735
Gross profit 4,00,847 3,125,998 10,989,254
Salary and wages 500,000 600,000 630,000
water 100,000 100,000 100,000
Electricity 360,000 360,000 360,000
Insurance 240,000 240,000 240,000
Communication 84,000 84,0000 84,000
Repair and 228,000 228,000 228,000
maintenance
Transport 324,000 200,000 300,000
Stationary 18,000 18,000 18,000
Total overhead 1,516,000 1,392,000 1,492,000
expenses
Net profit 2,484,847 1,733,998 9,497,265

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5.2 PROJECT STATEMENT OF FINANCIAL POSITION

1ST YEAR 2ND YEAR 3RD YEAR

FEIXED ASSETS
Premises 10,000,900 23,635,520 47,691,339
Vehicles and 50,000,112 6,977,100 200,100,000
tractors
Machinery 73,000,000 100,000,000 110,000
Current assets 133,001,012 130,062,620 247,901,339
stock 500,000 520,000 530,000
Debtors 200,000 208,000 212,000
Cash at hand 1,010,000 900,000 200,000
Cash at bank 50,000,000 60,000,000 79,000,000
Total assets 51,710,000 61,280,000 799,420,000
CURRENT
LIABILITIES
Trade creditors 900,000 30,000 70,000
Bank overdraft 1,000,000 700,000 1,500,000
LONG TERM
LIABILITIES
Long term loans 110,000,000 70,000,000 99,000,000
Owner contribution 273,000,000 150,000,00 350,000,000
Total liability 384,900,000 220,730,000 450,570,000

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 CHAPTER SIX

6.1 RISK MANAGEMENT

This is the identification assessment and prioritization of the risks. It aims to generate ideas
and promote good practice for the betterment of the business and managing risks through the
exchange of information.

6.2 Definition of Risk

It is also known as hazard peril, jeopardy, danger, venture chances. Risk is a situation involving
exposure to danger. It can also be defined as a probability or threat of damage, liability loss or
other negative occurrence that is caused by external or internal vulnerability.

6.3 RISK MANAGEMENT STAGES

6.3.1 RISK IDENTIFICATION

Here the business risks are identified. In Vikings Construction Limited some of the most feared
risks are earthquake, building collapsing and many more

6.3.2 RISK EVALUATION

Risk evaluation is concerned with assessing probability and impact of individual risks taking into
account any factors outside the immediate scope under investigation.

In Vikings Construction Limited there`s probability that some risks may arise.
Probability is the evaluated likelihood of particular outcome actually happening including aconsi
deration of the frequency with which the outcome may arises for example, major damage
to building is relatively unlikely to happen but would have enormous impact on business
continuity.

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 6.3.3 CHOOSING DEVICE OF HANDLING

Risks are many and occur differently however there are some devices that can be used to handle
the risks when they occur.

Vikings construction Limited will ensure the following things are put into consideration to avoid
risks

 All construction will be provided with helmet for protection in case of bricks failings
 Strong functions will be put in place to withstand earthquake
 Fire extinguisher will be provided in the buildings in case of inferno
 Emerging exit will be availing in case of any pending danger

6.4 TYPES OF RISKS

6.4.1 FINANCIAL RISKS

Financial support is very crucial to any business to function however lack of it can cause
the business to fail drastically and stop functioning.

Debts can also cause the business fail since the business needs money to top function and when
debts are incurred it means there is no money and businesses don’t run in-absence of money to
cater for its expenses.

6.4.2 ECONOMIC RISK

Economy is crucial for a business to function regarded that in real estate materials price do
change with economy changes. The business will face risks in terms of economy when there is
inflation, this may affect the budget and plans of the business to carry out its activity.

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 6.5 HOW TO HANDLE RISK

Vikings Construction Limited will put in place mechanism to overcome this risk. In terms of
financial risks the business will put in place some measures to make sure it gets its financial
plans in order through;

 Borrowing loans from banks

 Using the savings to boost the business
 Contribution from friends

To overcome economic risks the business, ensure that

 Its budget is not fixed

 It will purchase many of its material to avoid later rush when there is inflation

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