BUSINESS PLAN FOR

GOLDEN HAIR AND

BEUTY SALON.
INSTITUTION:
MACHAKOS UNIVERSITY COLLEGE (Constituent of Kenyatta University)

PREPARED BY:
HEZEKIAH ALUOCH MAINA

REGISTRATION NUMBER
J17/0007/2012
PRESENTED TO
MADAM LYDIA

THIS BUSSINES PLAN IS PRESENTED TO MADAM LYDIA KERUBO IN PARTIAL FULLFILLMENT FOR
THE AWARD DEGREE IN BACHELOR OF SCIENCE COMPUTER SCIENCE
DATE OF SUBMISSION 18TH MARCH 2016.

ALUOCH HEZEKIAH
J17/0007/2012

REGISTRATION NO

TABLE OF CONTENTS

i.

Student Declaration................................................................................................................3

ii.

Statement of Approval...........................................................................................................4

iii.

EXECUTIVE SUMMARY................................................................................................5

Business Description..................................................................................................................5
Proposed Business name address..............................................................................................5
Location.......................................................................................................................................5
Business Activities......................................................................................................................6
The keys to success in our business are:...................................................................................6
CHAPTER ONE............................................................................................................................7
1.0: BUSINESS DESCRIPTION..............................................................................................7
1.1: Business Venture..............................................................................................................7
1.2. Company Ownership..........................................................................................................8
CHAPTER 2...................................................................................................................................9
2.0: Products and Services.........................................................................................................9
2.1.1 Services...........................................................................................................................9
2.2.2 Products..........................................................................................................................9
2.3 Pricing.................................................................................................................................10
2.4. Start-up Summary............................................................................................................11
2.4.1 Start-up plan Summary Bar Chart............................................................................12
CHAPTER 3.................................................................................................................................13
3.0 Market.................................................................................................................................13
ALUOCH HEZEKIAH
J17/0007/2012

REGISTRATION NO

3.1 Competitive Summary.......................................................................................................13

3.2 Advertising..........................................................................................................................14
3.3 Customer Profile................................................................................................................14
3.4 Services................................................................................................................................15
CHAPTER 4.................................................................................................................................16
4.0 Market Analysis Summary................................................................................................16
4.1. Market Segmentation.......................................................................................................16
4.2. Sales Forecast....................................................................................................................17
4.3 Monthly Sales Forecast......................................................................................................17
4.4 Projected Balance sheet for year 2016..............................................................................18
4.5 Break Even Analysis..........................................................................................................19
4.6 Funding Sources.................................................................................................................19
APPENDIX...................................................................................................................................20

ALUOCH HEZEKIAH
J17/0007/2012

REGISTRATION NO

i.

Student Declaration

I declare that this business plan is my original work and has not been done by anybody and
presented to any examining body for the award of degree for any other University Institution in
Kenya.
Signature.Date.
Hezekiah Aluoch Maina.
Registration No: J17/0007/2012

ALUOCH HEZEKIAH
J17/0007/2012

REGISTRATION NO

ii.

Statement of Approval

I have verified and ascertain that this business plan is original work of the student done under my
supervision.
Name
Signature..
Date..

ALUOCH HEZEKIAH
J17/0007/2012

REGISTRATION NO

iii.

EXECUTIVE SUMMARY

Business Description.
Golden beauty and Hair Salon is a full-service beauty salon dedicated to
consistently providing high customer satisfaction by rendering excellent service,
quality products, and furnishing an enjoyable atmosphere at an acceptable
price/value relationship. We will also maintain a friendly, fair, and creative work
environment, which respects diversity, ideas, and hard work.
Proposed Business name address
Golden Beauty and Hair Salon
P.O.BOX 25-01254
Machakos-Kenya
Tel: 0725-769-345 or 0712226880.

Location
Golden Beauty and Hair Salon will be located 300 meters away from Machakos
University College, opposite Legends Bar. The salon will utilize 1,540 square
feet. The space will be rented from Mark Mutua, the owner of plot. The location
is strategically situated on one of the busiest streets in Machakos area. It is a high
profile area, with easy access from all parts of the town. The salon will be painted
grey with some picture of modern ladies hair style. Near the Salon, there will be a
sign board that points to the salon through an arrow. It has an ample space for
vehicle parking strictly for customers.

Business Activities
Golden Hair and Beauty Salon will provide a wide range of hair-dressing and
cosmetics services and products as well as sunbathing services. What will set the
salon apart from any competition is our commitment to continued education,
providing the latest hair care and beauty techniques, along with other related
services, at a convenient location.

The keys to success in our business are:

Affordability:
Providing an affordable price for customers especially the students who studies in
the University, Mtc and Century Park College among others.
Environment: Providing an environment conducive to giving a relaxing and
professional service.
Convenience:
Offering clients a wide range of services in one setting, and extended business
hours.

Reputation: The owner and other beauticians have a reputation for providing
superior personal service.

CHAPTER ONE
1.0: BUSINESS DESCRIPTION
1.1: Business Venture
1.1.1 Business Name.
Golden Hair and Beauty Salon.
1.1.2 Business Vision.
To be the best hair and Beauty Salon that provides a full service of excellent
hair and skin care of quality products with modern equipment , in a peaceful and
relaxed atmosphere at affordable price.

1.1.3 Our Mission:

To supply services and products that enhance our clients physical appearance and
mental relaxation.
1.1.4 Our Motto:
Customer Satisfaction Guaranteed.
Hezekiah, co-owner with Everlyn, , has worked in a prestigious, upscale salon in
Nakumat Mega opposite Nyayo Stadium-Nairobi, for the past two years. Everlyn
has created a large client following through hard work and dedication. Everlyn,
and her team of talented beauticians, have what it takes to make this venture an
extremely successful one. We expect our growing reputation to lead to new clients
and attract more beauticians to support our anticipated growth.

1.1: Business Venture (Cont.)

1.1.5 Objective of the business

a) Golden Hair and Beauty Salon, is more than just a full service salon
providing excellent hair and skin care and quality products, in a peaceful,
relaxed atmosphere. It will also provide a friendly work environment,
respecting diversity, creativity, and hard work.
b) Provides an affordable price services for the customers.
c) To put customers priority first by working for longer hours.
d) To create job opportunity for the students.
e) To be able to serve customer out from the salon premise.

1.2. Company Ownership

The Company Golden Beauty and Hair Salon Limited will be established on 20th
of January 2016 by Ms. Everlyn and Mr. Hezekiah Aluoch having 50% of shares
each.

Ms. Everlyn has been working as a sole trader providing beautician

service in Nairobi, as well as in Kisumu. All in all she has more than 8

years of experience in this field.

Mr. Hezekiah Aluoch has been working successfully with Kisumu Hair
Salon for around five months after Secondary education before joining the

University.
In the future we are both going to take additional courses in order to raise
our qualifications and provide more professional service.

CHAPTER 2
2.0: Products and Services
Golden Beauty and Hair Salon will be providing both services and products to
better meet our customers needs.

2.1.1 Services
cc:
Hair: cuts, relaxers, perms, colors, shampoo, conditioning, curling;
reconstructing, weaving, and waving.
Nails: manicures; pedicures; polish; sculptured nails.
Skin Care: European facials; body waxing; massages.
2.2.2 Products
Golden Beauty and Hair Salon will, upon commencement of operations, sell a
wide range of beauty products. We will be providing quality hair, nail, and skin
care products. Golden Beauty and Hair Salon has an exclusive contract with
RedKen retailers to sell their top quality products. In addition we will have other
name-brand products for sale to meet customer needs, such as: Matrix, Paul
Mitchell, Rusk, and Biolage. The products will include shampoos, conditioners,
mousse, hair spray, nail polish, nail files, skin conditioners, and cleansers, facial
masks, and other such beauty products. What will set Golden Beauty and Hair
Salon apart from the competition is our commitment to providing all of these
products and services in one convenient location.

2.3 Pricing
The brand-name hair products will range in cost from Ksh 600.00 Ksh 6000.00.
These costs will not vary from other competitors as there is a standard price that
salons may charge for these products. Our mark-up will be approximately 60%
above cost for a retail price range of Ksh 2880.00 Ksh 9600.00. This is standard
pricing in comparison to the competition.

Our services will average 6000.00, with a range of Ksh 1800.00 for a hair trim to
Ksh 21000.00 for a complete beauty package (hair, massage, facial, manicure, and
pedicure). These prices are lower than our competitors pricing.

2.4. Start-up Summary

Start-up

Requirements
Start-up Expenses

Currency values in Ksh

Legal

2500.00

Salon Refurbishment

10,000.00

Sunbed

10,000.00

Salon Equipment

60,000,000.00

Rent

8,000.00

Total Start-up Expenses

90,500.00

Start-up Assets

Start-up Assets

Loan
Investment

70,000.00

Total

40,000.00
110,000.00

Other Current Assets

Fixed Assets

4000.00

Total Assets

5000.00
9000.00

Total Requirements
Ksh 209,500.00

2.4.1 Start-up plan Summary Bar Chart

Golden Beauty and Hair Salon Start up plan

100000
90000
80000
70000
60000
50000
40000
30000
20000
10000
0

Loan

Expenses

Investments

Assets

CHAPTER 3
3.0 Market
The beautification industry is economically stable. However, our market share is
on the rise with an increase in disposable income as more women join the
workforce. Industry trends show that as time becomes more limited, people want
faster, easier and more economical services all in one location. Customers are
more educated and more demanding of quality service. Our market area includes
the Machakos University College, Machakos City as well as the surrounding
counties and surrounding communities. This will include a target population of
500-2500 people who fit our customer profile.

3.1 Competitive Summary

Golden Beauty and Hair Salon, wants to set itself apart from other beauty salons
that may offer only one or two types of service. Having come from such a salon,
Hezekiah realized from talking to clients, that they desire all of the services that
we are proposing, but they remain frustrated because they must get their hair done
at one place, and nails at another. Although the focus of Golden Beauty and Hair
Salon is hair services, we do plan to offer our clients the convenience of all these
services in one location.
There are a number of salons like ours, but they are mainly in the very high
income parts of Machakos and surrounding towns. We do not intend to compete
with these so called day spas. We wish to offer a middle ground for those clients
who cant quite afford those high-end luxury salons. Our business atmosphere
will be a relaxing one where clients can kick back and be pampered. Coffee and
soft drinks will be offered to clients as they enter for service. Televisions will be
located in the waiting and hair-drying areas.

3.2 Advertising
Our advertising strategy is a simple one: television, radio, website ads and
satisfied clients are our best marketing tool. When a client leaves our business
with a new look, he or she is broadcasting our name and quality to the public.
Most of our clients will be referrals from existing clients.
No major advertising campaigns are planned. Our research has shown that word
of mouth is the best advertising for this type of business. We will, however, run
specials throughout the week. We will also offer discounts to the new clients who
have been referred. There are plans for recruiting students from Machakos
University so that they secure a job either for part time or full, where full time job
will be applies after graduation. A client will be issued with a card that will earn
him/her points simply referring new clients to us, and we will place a card I the
box for each client he or she brings or how frequent he/he is serviced in our salon.
The more they bring the more chances they have of getting service discount it can
go even for free depending on the points.
We will be running ads in the Nakumatt, Naivas Supermarket and Star Beauty
Salon on a monthly basis. We have established an alliance with the Isaac who will
publish our ad for only Ksh 250.00 per month. Our Green Pages ad will be an
additional Ksh 180.00 a month which will be included on our monthly phone bill.
When we run specials we will hire a local person to put flyers on car windows, at
an approximate cost of Ksh 2400.00 per month. The rest of the advertising budget
will be spent on paying for the trip, the discounts, and the specials that will be
offered throughout the month.
Our advertising budget will be based on approximately 1% of our sales, which
will be Ksh 160,000.00 during our first year.

3.3 Customer Profile

Golden Beauty and Hair Salon typical client will be:
o Between the ages of 20 and 55 +
o Income levels of Ksh 5,000.00 and above
o Female and Men
o Typically employed part or full-time
o Looking for a salon close to the work place, for lunch hour services or
immediately after work
o Looking for reasonably priced services with a high level of luxury
o They like to be able to have all beauty care services and products in one
location due to a busy lifestyle.
There are approximately 400 and above potential customers within this profile
that would use the services of Golden Beauty and Hair Salon.

3.4 Services
Golden Beauty and Hair Salon realizes that the great customer service includes
complete service under one roof. Our services including hair-dressing, body
cosmetics, nail styling and extensions and sunbed are meeting our customers
high standard expectations.
The main services considering:
Hair: Cuts, relaxers, perms, colors, shampoo, conditioning, curling,
reconstructing, weaving, and waving.
Nails: Manicures, pedicures, polish, sculptured nails.
Skin Care: European facials, body waxing, massage, peelings, facial masks,
Sunbed

CHAPTER 4
4.0 Market Analysis Summary
There are many salons in Machakos town but no direct competitors interested in
deploying such tactics. We believe that our main strengths will also rely on
competitive prices and superb services in comparison to other local salons.
Significant number of Polish citizens in the area, vast experience of the owners
and competitive services will make us successful on the market.
4.1. Market Segmentation

Market Analysis
2011

2012

2013

2014

2015

Potential Customers

Growth

CAGR

Hair Care

5%

3,500

3,675

3,859

4,052

4,255

5.00%

Body Care

5%

900

945

992

1,042

1,094

5.00%

Nail Care

5%

900

945

992

1,042

1,094

5.00%

Sunbed

5%

2,500

2,625

2,756

2,894

3,039

5.00%

Total

5.00%

7,800

8,190

8,599

9,030

9,482

5.00%

4.2. Sales Forecast

Sales Forecast

Unit Sales

Financial Year(In Ksh)

2016

2017

Facial and Body Care

73,550

83,750

Nails

20900

30 950

Sunbed

1 900

2950

22,520

32,650

Hair Care

118,870.00

Total Unit Sales

150,300.00

4.3 Monthly Sales Forecast.

Monthly Sales Forecast of 2016

300000
250000
200000
150000
100000
50000
0

4.4 Projected Balance sheet for year 2016

Golden Beauty and Hair Salon Balance Sheet As at February 2016

To February 2017.
ASSETS

LIABILITIES
Current Liabilities

Current Assets

Ksh.

Ksh.
Cash in hand

83400.00

Capital

Other Current Assets

24400.00

Expenses

0.00
120000.00

Long Term Liabilities

Fixed Assets
Furniture

53000.00

Blow driers

28000.00

Websites ads

1200.00

Total Assets

190000.00

Loan

70000.00

Total Liabilities

190000.00

4.5 Break Even Analysis

As indicated on our Start-Up Costs Analysis, (on page 11) it will cost us Ksh
209,500 to get our Salon off the ground. At a daily projected total value of at least
Ksh 9000.00 for some service(s), we would have to serve 480 customers in order
to realize 250300 in our first year as our breakeven point for payroll and startup
cost, before we can realize a profit. This leads us to make about Ksh
40800.00.customers being served to pay off the yearly payroll and startup costs.
That averages out to approximately 480 customers that have to be served per
month. If we pursue our ambition of using television advertisement for our
services to target market, we would have to book use both radio and television for
popularity. All additional sales would result in a profit for the year.

4.6 Funding Sources

Golden Beauty and Hair Salon Team will be able to secure Ksh.70000.00 from
borrowed loan. In addition the business will also benefit from savings, as well as
from family and friends contributions. Therefore, we are seeking Ksh.30000.00
from interested persons who are willing to help us in raising the amount to make
this exciting venture successful. This business will generate job opportunity to the
qualified. Welcome.

CHAPTER FIVE.
5.0 Beauty and Hair salon Organization Structure.

Salon Owner

Salon Manager

Salon Assistant

Secretary

Stylist and
Technician

Subordinate

Accountant

Receptionist

Security Officer

The figure above shows the Architecture of salon Organization.

5.1 Salon Owner.

5.2 Salon Manager.

5.3 Stylist and Technicians.

5.4 Receptionist.
5.5 Salon Assistant.
5.6 Subordinate.
5.7 Security.

APPENDIX
Letter to Investors
Dear Potential Donor:
Thank you for taking the time to review the business plan for Golden Beauty and
Hair Salon
We hope that you found the information helpful in your decision to donate in our
exciting business venture. If you should require any additional information, please
do not hesitate to contact us at 0725769345 or
mailto:hezekiahaluoch@yahoo.com . Your email request for information will be
answered immediately. Please feel free and join us in raising this the amount. We
long to meet with you to discuss the financial details. We would be happy to set
up an appointment for you via the telephone to meet with me at your convenience.
On the back page, please find your personal invitation so that you can rate our
services. Seeing is believing! Directions to our location will be given to you upon
mailing or by phone.
Once again, thank you for considering joining Golden Beauty and Hair Salon
Sincerely,

Manager, Golden Beauty and Hair Salon