Business Proposal: TRIMAX Food Processors

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RYAN CHANUNKHA-BIT/020/17 REGINA TIMAMU-CHE/012/17 VITUMBIKO MANDA-CHE/025/17 MAXWELL ABUDUH-CHE/015/17 TATIANA CHIKHAMBI-CHE/003/17

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EXECUTIVE SUMMARY ... 7

Business objectives ... 7

Mission Statement ... 8

Guiding Principles ... 9

Keys to success ... 9

COMPANY DESCRIPTION ... 9

Business ownership ... 10

Legal forms ... 10

Business start up ... 10

Location and facilities ... 10

SERVICES ... 11

Daily operations and products ... 11

Preparation of raw materials ... 11

Opening days and working hours ... 12

Competitive comparison ... 13

Suppliers ... 13

Administrative systems ... 13

Payroll processing ... 14

Future products and services ... 14

MARKET ANALYSIS ... 14

Industry analysis ... 14

Market size ... 15

Industry participants ... 15

Main competitors ... 15

Market segments ... 16

Market tests ... 16

Target market segment strategy ... 16

Market needs ... 17

Market trends ... 17

Market growth ... 17

Positioning ... 18

MARKETING PLAN AND IMPLEMENTATION ... 18

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Goals ... 19

SWOT Analysis... 19

Strengths ... 19

Weaknesses ... 19

Opportunities ... 19

Threats ... 19

Pricing Strategy ... 20

Mark-up pricing ... 20

Reducing the left digit ... 20

Removing the Comma ... 20

Odd-Even Pricing ... 20

Daily equivalence ... 20

Listing in Installments ... 20

Price Anchoring ... 20

Bundling ... 20

Product ... 20

Promotions Programs ... 21

Month end Promotions ... 21

Religious Events/Public holidays ... 21

Events Sponsoring ... 21

Branding ... 21

Logo, Letterhead Package and Company Brochure ... 21

Tagline/Catch phrase/Slogan ... 21

Product Packaging ... 21

Brand Ambassador and Models ... 22

Apparel/Brand Clothing ... 22

Volunteer Shop Branding ... 22

Vehicle Branding ... 22

Brand Name Football Club establishment ... 22

Branding song ... 22

Social Media Marketing ... 22

Facebook ... 22

Twitter ... 23

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LinkedIn ... 23

YouTube ... 23

Website ... 23

Traditional Media ... 23

Direct Mail ... 23

Newsletters ... 23

Radio ... 23

Television ... 23

Placement ... 24

Print Advertising ... 24

Newspapers ... 24

Consumer Magazines ... 24

Sales Strategy ... 24

Selling to Wholesaler and Retailer ... 24

Selling directly to consumer ... 24

Selling by consignment ... 24

Selling via the internet ... 25

Selling with a Minimum Order Quantity (MOQ) ... 25

Unique Selling Proposition (USP) ... 25

Competitive Edge ... 25

Sales Forecast... 26

MANAGEMENT AND ORGANIZATION PLAN ... 26

Business management ... 26

Workplace management ... 26

Performance linked bonuses management ... 26

Recruitment management ... 27

Knowledge sharing ... 27

Management abilities to deliver plan ... 27

Management team ... 27

Management gap ... 30

Professional advisors ... 31

Organization chart ... 32

Financial Plan ... 33

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Important assumptions ... 33

Start-Up Costs ... 34

Source and Use of Funds ... 34

Break even analysis ... 35

Projections ... 37

Projected cash flow ... 38

Projected balance sheet... 40

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EXECUTIVE SUMMARY

The TRIMAX food processors Co aims at producing super porridge flour from maize bran, maize and other legumes like soya seed. The product will have high nutrient content and will help to minimize the food insecurity issues that arises in many communities in Malawi as a nation. Apart from supplying a well nutrient balanced porridge, the company will also supply porridge flour of different flavors to attract people of different preferences. The product is set to be more affordable with high nutrient content.

Tri-max Processors Company will be a privately owned business company consisting of five chemical engineers who are graduates of the Malawi University of Science and Technology. The business will be partially funded by the owners who will contribute MWK100, 000,000 out of the required MWK210, 500,000.

All five engineers will be involved in the management of the plant with Mr.R. Chanunkha as Chief Executive Officer, Ms.T.Chikhambi as sales and marketing manager, Ms.R.Timamu as the Human Resources Manager, Mr.M.Abdul as plant and safety manager and Mr.V.

Manda as the Head of Finance. With the qualifications of all the founders together with their expertise the business is expected to be a success. Efficient information flow among them will also be a key to achieving success.

Business objectives

 To provide quality porridge flour at reasonable price with exemplary service

 To supply porridge flour of different flavors

 To be the most valued porridge supplier by providing quality products and services.

 To provide employees with an exciting, enabling and supportive environment to excel and be innovative in

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Mission Statement

Our mission is to provide a unique, low cost and high quality porridge flour to the Malawian nation as well as outside the country. We will accomplish this by;

 Providing porridge flour of different flavors

 Providing porridge flour at reasonable prices

 Providing a conducive working environment to employees

 Being mindful of the wellbeing of our customers and staff

 Being mindful on the safety of the environment

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Guiding Principles 1. People centered

We shall ensure that our colleagues and all partners are treated with dignity, fairness and respect, to foster an environment where people can contribute, innovate and excel

2. Integrity

We shall conduct our business honestly, transparently and ethically and pledge to be open and professional in dealing with fraudulent and corrupt behavior within the company

3. Customer value

We shall make sure we surpass customer’s expectations both internally and externally through efficient customer service. We will provide the best, unique and quality porridge flour to our customers. This will make the customers to be satisfied by our services and would want our products again and again

4. Gratitude

We will show an attitude of gratitude to our customers and staff because without their input, service, labor and time, our business would not excel

Keys to success

 We will make sure that every customers who comes in once to buy our products should come again after being satisfied with our products

 Offer quality training and provide top wages to our employees so that they can acquire more skills needed for their job and to ensure they stay with us

 To make sure we are located near our target market so that our customers should not travel long distances to get our products

 A variety of porridge flour of different flavors and tastes reasonably priced to establish credibility, but not so high as to limit customers

COMPANY DESCRIPTION

Trimax is a food processing company founded by five chemical engineers. Super phala, a well nutrient balanced porridge flour will be the first product manufactured by Trimax.

The porridge flour will be available at both local and international levels at affordable

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prices. The porridge flour will be produced using locally available resources which will mainly include maize, maize bran and soya seeds.

The company is therefore going to offer various unique flavors of the porridge flour to stimulate and capture many customers. This will aid the business to grow and survive.

Business ownership

Tri-max Processors Company will be a privately owned business company consisting of five chemical engineers. Each individual will contribute a to the start-up cost and will be liable for the debt of the company from external finance.

Legal forms

The basic legal structure of this porridge flour business entity will be a non-corporate organization where there will be no separate status in legal identity among the owners.

This will therefore form the partnership with a legal contract among five chemical engineers (owners). This will help to build comparative advantage on sharing skills, workload and raising capital a strong competitive porridge flour business.

Business start up

Tri-max Processors Company will be a privately owned business company consisting of five chemical engineers who are graduates of the Malawi University of Science and Technology. The business will be partially funded by the owners who will contribute MWK100, 000,000 out of the required MWK210, 500,000.

Location and facilities

The company facilities will be located in central region of Malawi in Lilongwe Kanengo industrial area. This will simplify distribution of its product and gathering raw materials.

The facility will consist of warehouse, plant equipment, offices and office requirements such as chairs, benches and stationery. Transportation and communication equipment will also be present at the facility.

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Daily operations and products

Maize bran(madeya)

Cleaning

Boiling

Oven drying

Milling

Cooked maize bran flour

De-oiled soy bean cake

Milling

De-oiled soybean cake flour

Maize grain Cleaning &

grading

debranning

Natural fermentation

Boiling

Oven drying Milling

Fermented flour

Super phala( finished

product) Storage & packaging

Milk, flavour's ,sugar

mixer

Figure 1: Porridge production flow chart

Preparation of raw materials

At Trimax industrial plant, the main raw materials for super phala will be maize grain, maize bran, de-oiled soybean cake. The taste improving additives will be sugar, salt and flavors in a well-controlled proportion. Unlike the additives, the main raw materials will have to undergo a pretreatment for the final product to be a consumer commodity that will require preferably no cooking. Below are the processes each material will undergo;

1. Maize grain

Firstly, the grains will be cleaned using winnowing and screening and manually graded.

The cleaned and graded grain will be milled to produce de-branned grains which later be fed to the airtight fermentation chamber so it undergoes natural fermentation, a process which does not involve any use of artificial fermenting microorganisms. This process will take 3-6 days to complete. The fermented grain has an improved sour aroma and taste.

The naturally fermented grains will undergo boiling for 60-90 minutes so it gets cooked.

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The boiled product will be oven dried to temperatures of 70 ⁰C for 10 hours after which it will finally be milled into well powdered fermented maize flour.

2. De-oiled soybean cake

Unlike maize grains, this comes from the oil processing companies in a form which doesn't require much treatment. If in good moisture content, it will only require cleaning to remove chaffs and other impurities then milled to produce De-oiled soybean cake flour 3. Maize bran

This will be cleaned and boiled for 80 -95 minutes then oven dried 75c for 9 hours until a faint brown color is observed. The dried bran will be milled to produce the pre-cooked maize bran flour.

Mixing (blending)

The fermented maize flour, maize bran flour and de-oiled soybean cake flour in that predetermined ratio (4:3:3) will be fed to a mixing chamber and mixed thoroughly. The mixed product will be blended with sugar, salt and powdered milk in the controlled ratio of 10:0.5:0.2:0.3 respectively. The addition of flavors will be done later in a carefully controlled manner. The product will be super phala ready for home consumption.

Packaging

The well mixed blend that has been sufficiently dried will be put in packets of different sizes ranging from 200g to 50kg. The packages will be well labeled showing the constituents of the product, company name, preparation procedure and the company address.

Opening days and working hours

The company will be in service from Monday to Saturday for production and sales. The super phala will be sold out to wholesalers and retailers. Some will be supplied to the outlet factory shops in Lilongwe, Blantyre and Mzuzu. The Work will start at 8:00 am to 5:00 pm.

Monday 08:00 am – 05:00 pm

Tuesday 08:00 am – 05:00 pm

Wednesday 08:00 am – 05:00 pm

Thursday 08:00 am – 05:00 pm

Friday 08:00 am – 05:00 pm

Saturday 08:00 am – 02:00 pm

Sunday Closed

Table 1: operating hours

The Super phala will be properly packaged, well labelled and will be in varying quantities so as to meet different people’s needs and capabilities. There will be different flavors to

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meet customer preferences. It will be the duty of the sales manager to ensure that the inventory is well stocked so that the company does not run out of supply throughout the year and to ensure that the rising customer demand is met. Once the customers pay for the product the receipts will be printed out and the sales records kept for stock taking and future reference.

Competitive comparison

In Malawi there are a number of companies selling instant porridge flour. One of the companies is Rab Processors that manufactures Likuni Phala, primarily from, maize and soybeans. A 500g packet costs MWK1750.00. This 500g of super Phala is expected to be sold at MWK1650.00 because the maize bran and de-oiled soybean cake used are the byproducts of other processes which are likely to be purchased at relatively cheap price.

Sun gold processors makes Phala king from maize, soybean and groundnuts. A 250g of Phala king costs MWK200.00 while 250g of super Phala will be sold at MWK270.00 for the reason explained above. Universal industries limited makes Gluco phala mainly from ground nuts, soybeans, and corn. A 500g packet of Gluco phala costs MWK1750.00.

Local competitors within Malawi are the Rab Processors that produces Likuni Phala and Sun gold Malawi that makes Phala king.

Suppliers

Maize grains will be purchased from the local farmers around Lilongwe, Mchinji, Kasungu and other parts of Malawi in bulk and at a bargaining price.

The company will be buying the maize bran from the maize mills in the surrounding premises. The company trucks will be collecting the supplementary maize bran from different parts around Lilongwe if the nearby supplies are not sufficient enough to meet the production size requirement. The company will make a deal with oil processing companies in Lilongwe and Blantyre so that it should be buying the de-oiled soybean cake, there by product in bulk and at a bargaining price. Either the company's trucks will be collecting these cakes or the supplying companies themselves will be bringing them over with some additional cost. The company will purchase Sugar, salt, milk and food flavors from wholes sales in bulks at a better price.

Administrative systems

The following will be done to ensure that the finance and resources are being well controlled and monitored;

1. Daily cash control

The recorded sales and receipts will at the end of the day be compared with the cash at hand. An acceptable over/short amount will be limited to MWK5000.00 per day. An immediate audit will promptly be carried out once the shortage exceeds MWK5000.The money will be deposited to the companies account after stalk taking.

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2. Weekly prime cost report

The company will have someone to write a weekly report that will show the gross profit margin after the cost of labor, and law materials has been deducted from the sales revenue.

If the weekly prime cost is properly controlled the company will have a measure of its ability to operate the super phala business.

3. Purchasing records/payables

The company will employ a full-time bookkeeper who will be recording invoices and credits on a daily basis. There will be well detailed reports of cash expenditures, payments by check and accounts at the company. The company general manager will be given the authority of signing checks for the general operating account.

Payroll processing

Workers will be salaried monthly, specifically on 24th day of the month. The workers will have their accounts opened prior to starting working with the company. To make sure everyone has a working account and money transactions are done on time the company will make deals with the national Bank of Malawi so it should be opening workers accounts at fairly bargained opening costs.

Future products and services

The company will extend its production to milk processing from soybeans. Trimax also sees the future possibility and potential of venturing into cooking oil production from groundnuts and soybeans. All of these processes will be giving the company its raw materials to use in the production of future improved super phala.

MARKET ANALYSIS Industry analysis

The food processing industry which involves transforming the perishable and raw foods into value added products is expected to grow by 7.6% every year. The food processing market worth is expected to move from the current 99.68 trillion Malawi Kwacha to 134.77 trillion Malawi by the year 2030. Small and medium sized food processors in Malawi contribute up to 155 billion Malawi Kwacha to the Malawian economy annually and this value is set to increase as food processing industries are increasing.

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15 | P a g e Market size

The Malawian porridge industry consists of many products from different manufacturers including foreign brands. Below are some of the manufacturers with their respective popular porridge products in Malawi.

 Rab food processors- Likuni phala

 Superfoods- Morvite and Ace

 Sun gold- Phala King

 Premier foods- Iwisa

 Universal- Gluco Phala

 Nestle- Cerevita Industry participants

The major industry participants in porridge manufacturing sector in the country include Universal and Rab food processors.

Main competitors

The major competitors are mentioned below and include factories anywhere within the country.

 Rab food processors- It is a privately owned major agro- processing company in Malawi that was established in 1983. It has different products ranging from processed and unprocessed agricultural commodities and non-food household items. It has an annual revenue of 14.4 billion Malawi Kwacha

 Universal industries- It was established in the year 1957 and is based in Makata industrial area in Blantyre. It began as a single variety biscuit producer and has now grown to become a major food manufacturer. 58% of the company is owned by Universal Leaf Tobacco and the remaining 42% by Press Corporation. As of 2021, Press Corporation realized profits of 249.07 billion Malawi Kwacha compared to 202.89 billion Malawi Kwacha of 2020. Therefore on average annual revenue is 200 billion Malawi Kwacha.

 Sungold food processors- It is a Lilongwe based agro processing company that was established in the year 2015 during the Malawi Investment Forum. It is a private limited company that produces and supplies soya variants.

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Market segments

The company is expected to grow and disperse across the country with the first manufacturing site in Lilongwe for two major reasons;

a) Ease of distribution- The city is positioned in the central part of Malawi which would allow the efficient distribution of the product without affecting the cost as much in different areas.

b) Raw material acquisition- The central region is where maize is mostly grown as such raw material would be easily acquired at a cheaper price.

With an average annual income of MWK100, 000 to MWK200, 000 per year for Malawians, Super Phala will be set to meet the needs of many households especially as food for children. The most targeted population will be that in Lilongwe which has 1,200,000 people. Another target for the product will be entrepreneurs who will buy the product on wholesale and sale it to consumers all over Malawi.

Market tests

All founders of the company are chemical engineers who are very familiar with production processes and with the relevant fields of safety, marketing and business management. It is known that good things are expensive and there is a large gap between the poor and rich in Malawi. Low income mothers fail to buy good, easy to prepare and nutritious porridge for their children.

Students more especially those in boarding schools, both secondary and universities require different groceries. Instant porridge is one of the most bought item for students as it saves time and requires less effort. Currently, the most bought cereals have become expensive due to depreciation of the Malawian currency for example, cerevita has moved from k2000 to k5000 in one year.

In addition to that, the public requires a locally available product to avoid intermittent supply. The public requires a loyal product. Super Phala will be able to tackle all these in addition to being “the need the public does not recognize it needs”. The above points prove the viability of the product.

Target market segment strategy

Trimax will carry out different promotional events at the end of the month to increase brand awareness and sales. As most Malawians love gifts including the entrepreneurs, this will prompt them to purchase and sell the product more. Sponsoring events, conducting competitions and branding will also be utilized to reach out to the market. Kanengo industrial area will also promote the growth of the business as Lilongwe is the centre of business and it will ensure even distribution of super phala.

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17 | P a g e Market needs

With the change of lifestyles, people always prefer products that are easy to use and save time. Therefore, instant porridges are a necessity in the current day and age. People also require healthy food that they can afford as such, Super Phala will be a healthy product that also cuts the costs as it will be produced here in Malawi. The public will also not necessarily suffer from price shocks as the product will not always change prices due to the current unpredictable economy.

Market trends

From observation and interviews, some of the market trends for the manufacturing industry are;

 Healthy products for both adults and kids

 Locally available products

 Companies providing work to locals

 Locally sourced raw materials

 Affordable products

 Reliable products

Market growth

Land under cereal production which is a major indicator of the industry’s growth has increased over the years from 1.2 million hectares to 2.01 million hectares over a span of 49 years and is still growing at an average annual rate of 1.36%. The production has also increased from 2.5 metric tons to 2.93 metric tons between the years 2016 and 2018.

Below is graph showing the growth of cereal production land over the years 1970 up to 2010.

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Figure 2: Cereal production land increase graph

Positioning

Trimax super phala will be positioned as a top end quality instant porridge Malawians. It will be a product of great taste with health benefits. Trimax will position itself in the front line of solving cost and health related problems by utilizing local resources including labor.

MARKETING PLAN AND IMPLEMENTATION

The purpose of this marketing plan is to command awareness, lead interest in the product and provoke desire to use the product. The plan is to make the brand name popular to the whole Malawian population. The aim is to make the brand name have a place in the minds of people. On the other hand, the plan ensures consistent high sales volume.

Note; The marketing strategies will not all be implemented at once but will depend on capital, budget and company growth.

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Goals

 To enhance image, name recognition, reputation.

 To introduce a new product in Malawi.

 To generate a new customer base.

 To enhance brand popularity.

 To increase sales volume.

SWOT Analysis Strengths

 The Business location is strategic for easy distribution

 The owners of the business are chemical engineers who understand the process of making the product itself.

 The owners of the business have managerial positions which is going to ensure that the company is managed with passion.

 The product is Malawian made which is going to give a competitive edge on customers who are patriotic.

Weaknesses

 Recruiting and retaining quality employees.

 Lack of support from Malawians for locally made products.

Opportunities

 Rising cost of imported porridge products gives an opportunity for entry into the market.

 The raw materials to be used are crops which are grown in Malawi. This gives an opportunity to take advantage cheap prices and reduced transportation costs.

Threats

 Rising production costs

 Food insecurity which leads to scarcity of raw materials

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Pricing Strategy Mark-up pricing

This is the price that will be set after calculating costs/expenses and add an amount as profit.

Reducing the left digit

The human brain encodes numbers quickly so, a smaller first digit will make the price seem much lower. For example; MWK4,999.00 seems a lot less than MWK5,000.00.

Removing the Comma

Studies show that removing the comma from the price makes it seem lower.

For example; 1,799 vs 1799.

Odd-Even Pricing

Consumers are more likely to choose a price ending in an odd number that is right next to an even whole number like 2.97$ rather than 3.97$ or 5.97$.

Daily equivalence

The price will be broken down into how much it will cost daily which is going to make the price seem more affordable. This will be done to wholesalers who will get large orders and pay the daily or monthly equivalence.

Listing in Installments

Customers are anchored toward the smaller prices subconsciously even if they know the full price. So, the prices will be shown in installments rather than a huge sum.

Price Anchoring

The anchoring effect involves first setting the price higher the show a much lower discounted price. The customer’s decision will be based on the anchor price. For example; “Was k10,000 now get it at k6,000”.

Bundling

Multiple products will be bundled together at a lower price than the total individual cost.

Product

The instant porridge provides food and energy to the customer. The product has carbohydrates, proteins, iron and fat supplements for the consumer. The product has nutritional benefits to the consumer. It will help in preventing deficiency diseases. The product is suitable for all age groups.

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Promotions Programs

Month end Promotions

Promotions will be made at month ends by giving out discounts on large quantity orders. This is done at the end of the month simply because people receive salaries month end and people are more likely to buy when they have money.

Religious Events/Public holidays

Promotions will also be done for festive seasons, religious celebrations and public holidays. Religious events like Eid Mubarak, Ash Wednesday, Christmas, International Women’s day, Teachers Day, Martyrs’ day, Valentine’s Day, Thanksgiving, Earth day, Memorial Day, Nursing Day, Mother’s Day, Gender days, Labor Day, Independence Day, Easter, etc should be recognized through posters released on social media platforms.

Events Sponsoring

Organizing or sponsoring events, conducting dance competitions and giving out gifts and prizes while promoting the product. The gifts will be brand T-shirts and hats. Sponsoring university social weekend will be an effective strategy to enhance awareness to the university students.

Branding

Logo, Letterhead Package and Company Brochure

The logo is designed to grab attention, make a strong first impression. It is the foundation of the brand identity, is memorable and separates the company from competition. The logo will facilitate brand loyalty. The logo will placed almost everywhere from the packaging, business cards, vehicles, shops and the way to brochures and social media. A letter head is as important as the brand, in that it represents the company and can impart a first impression to its potential customers.

Tagline/Catch phrase/Slogan

The tagline is the company’s slogan which short and memorable. The proposed taglines are “Malawian made” to invoke patriotism, “kuphika kuchedwetsa”

“mukhalilanji ndi njala”, “kukhuta mbambamba”, “Njala situkula dziko” to represent the purpose and value of the product.

Product Packaging

The product is going to be packaged in sachets having the company logo, catch phrase, Malawian flag. The package will also show a brand model or graphic cartoons depending of the target age group. The packaging can also be custom to allow flexibility depending on different customer requirements for example; words like “Donated by USAID” or “Government relief”. The packaged can also be personalized to a specific customer.

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Brand Ambassador and Models

The brand ambassador will a Malawian popular Artist to promote the product through social media, songs and popularity. The ambassador will make videos wearing the products branded clothes and urge the masses to buy the product.

Apparel/Brand Clothing

The company will have branded T-shirts and hats to be given out to loyal customers.

This will enhance brand popularity and encourage customers to buy more.

Volunteer Shop Branding

Small grocery stores will be given an opportunity to allow the company to paint their shops with the brand name, brand products and colors. For example TNM and Airtel volunteer to paint small grocery shops with their brand logo and colors.

Vehicle Branding

The company will brand a company owned vehicle preferably a minibus which is going to be moving around with megaphones or speakers to voice out upcoming promotions, events, products and competitions. Product distribution trucks are also going to be branded so that they deliver a message as the drive around the country there by enhancing brand popularity.

Brand Name Football Club establishment

The company will establish and sponsor a football team which is going to playing in the Malawian local league. This is to create awareness and enhance popularity on the company’s brand name.

Branding song

A branding song will be composed and is to be played during drive by advertisements. The song will also be played on television and radio Ads.

Social Media Marketing Facebook

This is the social networking site for boasting staggering statistics about the company. A sponsored Facebook page will be created for posting content like photos, videos, words or links. Product photos will be posted to show case the range of products the company is offering. The page will also show important newsletters, upcoming events, promotions. The page is going to be sponsored thus all the Ads and photos will be paid for to reach a large population of target customers.

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23 | P a g e Twitter

Similar to Facebook a Twitter page will be set up to catch the young audience flocking to Twitter. The page will be sponsored, running sponsored Ads that will be showcasing the products, events and news from the company.

The site that gets down to business. Here is where professionals post their resumes, do their networking and read about the latest industry trends. A good place to showcase the company’s professionalism and our highly qualified employees.

YouTube

YouTube is all about watching videos that the business makes. This will open the company’s own network and start to build subscribers. Videos about new product line or events will be posted.

Website

The business will stay current with industry trends using a webpage. The webpage will show a menu, map and hours of operation. The contact details and customer help line will also be easily accessed on the webpage. Products and features will also be showcased on the webpage. Customers will be able to make online payments via the website.

Traditional Media Direct Mail

This involves writing advertising emails to potential buyers of the company’s products. A market research will help create a mailing list of customers who have the potential to buy the company’s products. New letters, new products, events and important notices will be emailed to existing and potential customers.

Newsletters

A printed or electronic report containing news concerning the activities of the business will be sent to customers and employees. Hard copies will be given out by hand to customers. Electronic Newsletters will be shared on social media pages and the company’s webpage.

Radio

Radio Ads will run at various strategic time that the target audience is listening. The brand song will be played to enhance awareness and popularity. The company’s products, competitions, promotions and events will also be on interest.

Television

Television is also one of the most effective ways to reach out to the population.

Television Ads will run on products the company is offering. However, television

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Ads are expensive as such this strategy will be greatly determined by the budget and growth of the company.

Placement

The company is to be located in the capital city Lilongwe. Geographically, Lilongwe is in the central region of Malawi. This location is strategic because it is going to achieve fast and economical distribution of products to all parts of the country. Lilongwe has the highest population of people as such the demand of the products will be high as well. The central region is also the highest producer of Maize which is one of the main raw materials hence minimizing transportation costs.

Print Advertising Newspapers

Newspapers will also be used to advertise the company’s products, introducing new products. News on events, discounts and promotions will also be conveyed.

However, newspapers are an expensive strategy for advertising hence it will be done while considering the budget and company goals.

Consumer Magazines

Magazines showcasing the company’s products, achievements, social influence will be printed and given out to customers as they buy the products. Magazines will be distributed to the company offices and shop outlets.

Sales Strategy

Selling to Wholesaler and Retailer

The company’s products will be sold to wholesalers because they large quantities and sell them for profit. This assures cash flow since the company can increase its production capacity since large quantities of the product will be sold at once. The products will also be sold to retailers but at the different price from the wholesale price since retailers buy less compared to retailers. This will also ensure fair grounds of trade between the wholesalers and retailers.

Selling directly to consumer

The product will also be sold directly to the consumers through the company’s outlet stores. This will maximize the sales and ensure continuous cash flow.

Selling by consignment

This involves selling products to a retailer, also referred as a consignee, and agrees to pay the company (consignor) for the merchandise after the products sell.

However, this privilege will only be available to trusted big retailers for example, Shoprite, Sana etc.

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Selling via the internet

The company’s products will also be sold via the website. Orders and payments will be made online as well. After payment delivery arrangements can be made. This simple and easy access will give the company a competitive edge both locally and internationally.

Selling with a Minimum Order Quantity (MOQ)

Minimum order quantity is the smallest number of products a wholesaler is allow to buy from the company. This will ensure that the company avoids wasting resources on orders that deliver little or no profit. This will be based on the number of units or total order value. This also ensures that the company covers the cost of production and meet the profit margins when supplying the products.

Unique Selling Proposition (USP)

The company’s product will give several benefits to the customers that are totally unique and will separate it from competition. The instant porridge is highly nutritive, convenient, cheap and at the same time saving both time and money for the customer. This is unique to the company because there are no products on the market that provide both time saving and money benefits to the consumer. The products on the market either benefit one or the other but not both.

Competitive Edge

The product will be made from raw materials that are locally available and cheap. For example, maize bran is locally available in sufficient amounts in maize mills all over the country. This will help reduce production costs there by enabling the company to offer competitive product prices on the market.

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Sales Forecast

The company is expecting a 10% increase in sales annually for the first 4 years.

Annual Sale

Forecast Year 1 Year 2 Year 3 Year 5

Sales Instant Porridge revenues

k1,149,120,000 K1,264,032,000 K1,390,435,200 K1,529,478,720

Total Sales k1,149,120,000 K1,264,032,000 K1,390,435,200 K1,529,478,720

Controllable

Costs

COGS K416,345,000 K425,309,000 K430,365,000 K450,400,000 Payroll K219,110,000 K225,370,000 K237,339,000 K226,470,000 Total Prime

cost K635,455,000 K650,679,000 K667,704,000 K676,870,000 Controllable

profit K513,665,000 K613,353,000 K722,731,200 K1,461,791,720

Table 2:Table showing sales forecast in the first three years

MANAGEMENT AND ORGANIZATION PLAN

Business management

This will involve the act in which the business will be run, and those in charge of running the business according to their respective professional positions.

Workplace management

This will involve consideration that facilitates conducive working environment for maximum qualitative and quantitative production. This will be done by creating a safe, healthy, and happy workplace for all workers to make sure they are comfortable, satisfied, secured, and at the same time retaining them.

Performance linked bonuses management

Bonuses and compensations will be awarded in accordance to those that deserve it. This will be done in the best interest of boosting employee morale and performance.

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Recruitment management

The company is to work with both skilled and unskilled laborers. The recruitment process will be taken seriously to choose workers that are not only skilled but also professional in their different positions. All the recruit are to undergo proper training this is because the whole business will be centered on the output of the whole team.

Knowledge sharing

A knowledge sharing platform will be established. New creative and innovative ideas or knowledge obtained from competencies or skilled development program will be shared to the rest of the workers on a mandatory basis. The innovative ideas will be posted on this platform to be evaluated and implemented if they are beneficial to the company.

Management abilities to deliver plan

Will make sure that the managers have the following skills to deliver plan:

 Hard working

 flexible

 strong communication skills

 Ability to identify and prioritize critical task

 Ability to define clear goals and key variables (goal setting)

 Leadership

 Ability to execute plans, monitor progress and performance and provide continued support

Management team

The Trimax non corporate company will be privately owned by five founding members.

The management team positions, roles and responsibilities and skills are described below:

I. The chief executive officer (CEO)- Mr Ryan Chanunkha Roles and responsibilities

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 He will be acting as a head of the business

 Overall responsible of finance issue of the company

 Responsible for business development

 Gather all the teams and company to focus the towards company’s vision

 To build and implement company policies for the betterment of the customers, business partners and employee

Qualifications and skills

 Bachelor degree(hons) in chemical engineering

 Diploma in business administration

 Good communication skills

 Good management skills

II. Head of finance- Mr Vitumbiko Manda Roles and responsibilities

 Keep check and balance all the business accounts

 Handle core finance management issues of the company

 Look after the investment, loans, insurances, business taxations, cash flow and other internal finance matters of the company.

 Responsible for inviting and attracting new business investments, opportunities, and partnership

 Able to take key finance decisions of the company

 Approve budget for marketing strategies.

 Diploma in finance management with 3years experience in finance controlling

 Bachelor’s degree (hons) in chemical engineering

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III. Human resource manager (Ms Regina Mtimawu) Roles and responsibilities

 Recruit new employees

 Decide number of employees to be recruited

 Provide required training procedure for the employees

 Evaluation and assessment of employees Qualifications and skills

 Bachelor’s degree (hons) chemical engineering

 Procurement and business management certificate

 2 years’ work experience in human resource management

 Top level knowledge in industry studies, engineering and society and business management and entrepreneurship

IV. The Sales and Marketing Manager-(Ms. Tatiana Chikhambi) Roles and responsibilities

 Look after overall sales, services before and after delivery of product

 Build, manage, and implement new marketing strategies for company and product promotion

 Identifying, targeting, and attracting potential customers.

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 Good communication skills

 Degree in bachelor degree in chemical engineering (hons)

 Certified marketing and sales agent

 Ability to develop and implement marketing strategies

V. The plant and safety manager -(Mr Maxwell Abuduh) Roles and responsibilities

 Responsible for continuously innovating and adding value to our product

 Optimizing the process to maximize the yield and minimize the cost of production

 Sustain the plant machinery and equipment for production through preventive maintenance

 Maintain the safety of the factory

 Manage the quality of the product and raw material used

 Manage materials handling and packaging

 Waste management and treatment

 Bachelor’s degree in chemical engineering(hons)

 Equivalent knowledge in industry studies and safety healthy and environment issues

 Equivalent knowledge in environmental engineering

 Certified in environmental health and training.

 Equivalent knowledge of safety mass and energy balance Management gap

Our management team although it shows readily available experts, there are a number of positions that need to be filled in for better performance of the business. The company is willing to recruit more qualified individuals to start with and the number of recruits will increase as time goes. Some of these recruits include:

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 Distribution truck drivers

 Design team

 Security team

 Assistant officer

 External audits

 Estate manager

 Assistants’ operators

 Procurement manager

Professional advisors

NAME OF ADVISOR POSITION /PROFESSIONALISM

MR ISA EDWARD ENTERPRENEURSHIP SPECIALIST

DR H. ULUKO FOOD ENGINEER

DR S. CHABWERA ACCOUNTANT AT STD BANK

MS K. SILUNGWA CONSULTANT IN BUSINESS

MANAGEMENT

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Organization chart

RYAN CHANUNKHA

(CEO)

MAXWELL ABUDUH Plant and

Safety Manager

REGINA TIMAMU Human Hesource

Manager

TATIANA CHIKHAMBI

The Sales and Markerting

Manager VITUMbIKO

MANDA The Head

Of

Finace

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33 | P a g e Financial Plan

The following sections are our outline for the financial plan

 Required Cost of start-Up

 Profit and loss

 Cash flow

 Balance Sheet

 Financial ratios

 Hourly labor costs

 Weekly sales projections Important assumptions

 The product price ranges from k200.00 to K30,000.00.

 The factory is located in Lilongwe kanengo Industrial Area.

 The factory is comprised of Dryers, Mills, Mixing chamber, Conveyors, Boiling towers, Packaging machines, boilers, separators, fermenters.

 The company has two, ten ton trucks of which one will ferry in raw materials and the other will distribute products to factory outlet shops, retailers and wholesalers.

 The company will employ 15 employees.

 The annual target revenue is k800,000,000 to k1,500,000,000.

 Annual 4% increase for inflation and 6% annual increase in revenues.

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34 | P a g e Start-Up Costs

Start-Up Expenses Amount

Logo, letter heads branding K500,000 Permits(TPIN, Food License, business

license, PPDA, Withholding Tax) K200,000

Contingency K10,000,000

Building improvements K7,000,000

Rentals K2,500,000

Working Capital K20,000,000

Raw Materials K20,000,000

Outdoor sign K800,000

Advertising and Marketing budget K5,000,000

Total start-Up expenses K86,000,000

Table 3: Table showing startup costs for Trimax

Start-Up Assets

Office furniture K6,000,000

Plant Equipment and machinery K32,000,000

2 Trucks K48,000,000

1 pick up K15,000,000

Fork lift K4,500,000

Shop fitting and furniture K2,000,000

Computers and Printers K10,000,000

Lab equipment K15,000,000

Cash registers and POS systems K4,000,000

Cash Safe K800,000

Total Start-Up Assets K144,500,000

Total Required Start-Up Costs K210,500,000

Table 4: Table showing the startup assets for Trimax

Source and Use of Funds

The majority of costs come from vehicles, plant equipment and raw materials. Additional costs are working capital and contingency. The total start-up costs are estimated to be k210,500,000.

The partners will apply for a k110,500,000 only bank loan as they will contribute the remaining k100,000,000 from personal saving. They will use their personal assets together with the company equipment as collateral to cover for the loan if they fail to repay within an agreed five years.

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Source and Use of Funds Sources of Funds

Bank loans K110,500,000

Owners, and other investments K100,000,000

Total Source of Funds 210,500,000

Use of Funds

Equipment and Machinery K51,500,000

Location expenses K9,500,000

Marketing expenses K5,800,000

Contingency Funds K10,000,000

Working Capital K20,000,000

Transportation expenses K63,000,000

Office and shop expenses K24,800,000

Startup inventory K20,000,000

Other expenses K7,000,000

Table 5: Table showing the sources and use of funds

Break even analysis

The total annual fixed cost of Trimax is MWK635,455,000. Estimating MWK3,000 as a variable cost per unit, MWK15,100 as average price per unit, the break even revenue is MWK1,092,425,000 at 142,800 units sold. This is illustrated in the table and graph below;

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36 | P a g e Net

Sales Net Revenue Fixed Costs Variable Cost Total Cost Total Profit Fixed Cost: K635,455,000

Variable Cost: K3000 Number of Sales: 2550 Average Sale Price: K15,100

0 MWK0 MWK635455000 MWK0 MWK635455000 MWK-635455000

61200 MWK924120000 MWK635455000 MWK183600000 MWK819055000 MWK105065000

122400 MWK1848240000 MWK635455000 MWK367200000 MWK1002655000 MWK845585000 132600 MWK2002260000 MWK635455000 MWK397800000 MWK1033255000 MWK969005000 142800 MWK2156280000 MWK635455000 MWK428400000 MWK1063855000 MWK1092425000 153000 MWK2310300000 MWK635455000 MWK459000000 MWK1094455000 MWK1215845000 163200 MWK2464320000 MWK635455000 MWK489600000 MWK1125055000 MWK1339265000

Table 6: Table showing profits for Trimax

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Figure 3:Graph showing the break-even point for the business

Projections

All the balances below will be taken on a yearly basis. Trimax’s year will begin in October and end in September. Below are the cash flow and balance sheet tables for Trimax processors.

-1,000,000,000 -500,000,000 0 500,000,000 1,000,000,000 1,500,000,000

0 20000 40000 60000 80000 100000 120000 140000 160000 180000

REVENUE

UNITS SOLD

BREAK-EVEN

Break-even point