Start Your Waste Recycling Business Business Manual Final. 031207

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Start Your Waste Recycling Business Business Manual Final. 031207

Transcript Of Start Your Waste Recycling Business Business Manual Final. 031207

Start Your Waste
Recycling Business
A TECHNICAL STEP-BY-STEP-GUIDE OF HOW TO START A COMMUNITY-BASED WASTE RECYCLING BUSINESS
Start Your Waste Recycling
Business Business Manual
INTERNATIONAL LABOUR OFFICE
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Start Your Waste Recycling Business
Business Manual
October 2007 This Training Material is based on a training package that was originally produced in
2001 for the Sustainable Lusaka Programme by a task force of the International Labour Organization:
Adapted by Royal Business Consult Trust, Harare Zimbabwe
International Labour Office Norfolk Rd, Mt Pleasant Arundel Office Park
PO Box 210 Harare, Zimbabwe Telephone: +263-4-369805-12
Fax: +263-4-369813
Copyright is vested in the International Labour Organization. Nevertheless, short excerpts may be reproduced without authorization, on condition that the source is indicated. For permission to use or reproduce the contents of this training material,
contact ILO on the address above
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CONTENTS

1. THE BUSINESS PLAN

What is a Business Plan

4

How a Business Plan can help in starting a Business Activity 4

Contents of the Business Plan

4

2. DESCRIBE YOUR BUSINESS IDEA

What is a Business Idea

7

3. DEVELOP YOUR MARKETING PLAN

What is Marketing

11

Do Market Research

11

Make a Marketing Plan

14

4. DEFINE THE FORM OF BUSINESS

The different forms of business

24

5. ASSIGN BUSINESS TASKS

How to identify and assign business tasks

31

6. COST YOUR SERVICES

What is costing

34

Why is costing important

34

Types of costs

34

How to cost your services

35

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7. CALCULATE YOUR REQUIRED START-UP CAPITAL

What investments do you need

45

What working capital do you need

45

Types and sources of start-up capital

50

8. PLAN YOUR FINANCES

What is financial planning

54

The Sales and Cost Plan

54

The Cash Flow Plan

58

9. MANAGE YOUR FINANCES

What is financial management

62

The record book

62

Other records

64

The Profit and Loss statement

65

10. GET STARTED

What is an Action Plan

67

How an Action Plan can help you

67

Your Action Plan

68

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1. THE BUSINESS PLAN
WHAT IS A BUSINESS PLAN
To think of a business idea itself is the first step. If you have a feasible business idea and seriously think about starting a business then you need to collect certain information and make plans to see if the new business will be profitable and if you should take the risk to start. There is need to match oneself through personal attributes for the business idea one is thinking about. Structuring your ideas and the information you collect in a systematic manner, and putting it down in writing and translating the ideas into financial sense is called making a Business Plan.
Making any plans or adjustments to the business idea has to be reflected throughout the business plan itself at any point in time. This makes the business plan realistic and up to date.
HOW A BUSINESS PLAN CAN HELP IN STARTING A BUSINESS ACTIVITY
A Business Plan helps you to • decide if you should start your business or not • organize your ideas so that you will start and run your business in the best way • present your business idea to a lending institution such as a bank to get a loan for your business.
This manual helps you to prepare a business plan for your proposed business. The accompanying booklet contains the Business Plan you will complete for your business idea. When you have completed your Business Plan, you should be able to estimate if your business idea is viable and profitable. If you decide to go ahead and start your business, you will have a plan for how to do it.
CONTENTS OF THE BUSINESS PLAN
A Business Plan covers all the important aspects to be considered before starting a business. It is a guide for you to follow so that you do not overlook when preparing for your new business. Chapters 2 to 8 and chapter 10 in this manual
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each cover one part of the Business Plan. Chapter 9, which deals with basic financial management, is not part of the Business Plan. Still, it has been included in this manual because you will need some knowledge about financial management from the first day of operating your business.
This is the beginning of a new way of doing things. The various approaches in working to find information result in the same information, which enables you to write up your business, plan.
When you have worked through all the chapters you should be able to:
• Make your own Business Plan • Start your own business.
These are the main parts of the Business Plan:
• Your Business Idea
Businesses in any economic sector are based on an idea. It is a business idea about what products or services you are going to provide; where and how you are going to sell and who you are going to sell to. Chapter 2 helps you to think about your business idea and to write it down in the first part of the Business Plan.
• The marketing plan
When thinking of business you have to plan in detail how you are going to market your products or services. Marketing is everything you do to find out who your customers are and what they need and want. In your marketing plan you are required to write down the details of what products or services you are going to sell, what prices you are going to charge where your business is going to be located and how you are going to promote your products or services and mobilize the potential customers. Chapter 3 helps you to think about your marketing plan and to write it down in your Business Plan.
• Form of business
There are different forms you can choose to pursue your business activity. They all have advantages and disadvantages and which form you choose depends on your personal situation and objectives or the characteristics of your group and your group objectives respectively. Chapter 4 explains the different forms of businesses and helps you decide which form suits you best.
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• Tasks of group members
You need to think about who is going to perform which task in your business. What skills and experiences are needed to produce your products or provide your services? Do you have to hire any employees? Chapter 5 helps you to look at all the tasks that will be performed in your business and decide who will carry them out.
• Costing
To be able to set your prices and make financial plans, you need to calculate the costs of your products or services. Chapter 6 shows you how to do costing for your business.
• Start-up capital
Start-up capital is the amount of money you need to start your business. You need money for equipment, materials, rent, wages, etc. Chapter 7 helps you to calculate how much start-up capital you need before you can start your business.
• Financial planning
All businesses need to plan for the future. Chapter 8 helps you to plan both your profits and your cash flow for your new business.
This manual contains two more chapters that are not directly linked to the Business Plan but of vital importance for you to get your business up and going:
Financial management
As indicated before, financial management is not part of the Business Plan. Still, you need to know some basics of financial management to run your business properly from the first day. Chapter 9 assists you to set up a simple record keeping system and to produce a monthly profit and loss statement.
Getting started
Chapter 10 introduces an Action plan that assists you to put the Business Plan in practice and to implement it step by step until you have got your business started.
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2. DESCRIBE YOUR BUSINESS IDEA
WHAT IS A BUSINESS IDEA
Every business comes out of an idea. Businesses are started by men and women who see that people want to buy a particular product or a service. When you discover a business opportunity you need to develop your thoughts into a business idea. A business idea is a short and precise description of the basic operations of the business. Your business idea will tell you:
• What product or service your business will sell • Who your business is going to sell to • How your business is going to sell its products or services • Which need your business will fulfill for the customer.
What
What product or service will your business sell? Your business idea should be based on what you are good at. Maybe you have experience in a specific line of business or have trained in a skill. The business idea will help you to focus what you could do.
Who
Who will buy your product or service? Your customers can be individuals or other businesses. They may all be within a small area or they can be spread over a large area, maybe a whole country. Will you only try to sell to a specified type of customer or to everyone in an area? It is important to be clear who you intend to sell to.
How
How are you going to sell your product or service? A manufacturer or service operator can sell in many different ways. For instance, a service operator can go to the customer to deliver a service (e.g. a plumber who is called in to clear a gutter), or, expect the customer to come to a workshop or office to receive a service (e.g. a hairdresser). A manufacturer can, for example, sell either to customers or to retailers.
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Which
Which need your product or service will fulfill for customers? Your business idea should always have the customer and the customers’ need in mind. It is important to find out what the customers want and to listen to your future customers when you work out your business idea.
Your product or service must offer something ‘special’ for the customers to come to your new business. They must need and want your product or service. Many entrepreneurs make a mistake to think that because their business is introducing a new product or service, there must be demand for it. But because the product or service is new does not mean that there is demand for it. Make sure that there is a demand for your product or service.
Below is an example of Busonga Paper Tech who have developed a business idea in waste paper recycling and processing of stationery. The group will accompany you throughout the Manual and show you how they started their own business activities.
BUSONGA PAPER TECH __________________________________________________________________
Brief Background Waste management in the city of Monasa had deteriorated in 2004. The local authorities were running out of space and resources to manage waste. In some parts of the city waste was remaining uncollected for many months. This was creating a health hazard for the local community who themselves were not sure of how to dispose of waste or recycle it. In realization of the plight in the city of Monasa, a local environmental organization called Health Care started training the local households on the management of waste including some of the ways to reuse waste material that is recyclable. Busonga village community decided to register a Trust called Busonga Environment Trust. The Trust was encouraging the community to be part of the clean up including planting trees around to rehabilitate the surroundings. However after encouraging the community to clean up and collect litter, there was a problem of how to dispose of the litter. This motivated a group of six men and women to form a Community Based Enterprise to recycle Waste. Considering the different types of recyclable waste that was available in the local households and the local industrial site, which included, paper, plastic, bone and cloth, the group chose to focus on paper.
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The group set down to develop a business plan for their intended business. Follow their example in developing your own business plan for your intended business in Waste recycling.
Brief description of the waste being recycled The group chose to focus on paper waste, including cardboard but excluding plastic. In choosing the type of waste to focus on the group was guided by the facilities they had for storing waste for processing. Though the group had wished to be allocated land by the local authority this had not materialized and they had to use a backyard for one of the members’ house. Waste paper was easy to store in the backyard than other organic waste. The group described their business idea as follows:

Name of Business Busonga Paper Tech

Business Idea

The business is going to (write on the applicable line) 珀 Produce the following product or products
Produce special paper and use it to make CD boxes, Gift boxes, and folders, picture frames, photo albums and diaries.

珀 Provide the following service or services

The customers will be:
The local community households, gift shops, stationery shops, workshop organizers and tourists

The business will sell in the following way:
The products will be produced per order and delivered to the customers. A few products will be made for individual customers who will buy from the production site.

The business will satisfy the following needs of the customers:
Communities will enjoy a cleaner environment; households need special products for decorating their houses, tourists need special products for souvenirs, gift shops and stationery shops need products for resell to their customers.

For a start, they write down the business idea in the business idea form of the business plan.

Access to Raw Materials The group further realized that for their business to succeed they needed a constant supply of raw materials. They identified the following as the key sources for the waste paper; households and local business people. The group considered that it was easy to use paper that was separated at source since they were not going to

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BusinessBusiness PlanBusiness IdeaServiceCustomers