1. Introduction 2.1. Name of Company
Fa Fa Furniture. 2.2. Nature of Company
We form our business as a “partnership” business. The types of our business are Manufacturing Furniture’s, Wholesaler. We produce wooden furnitures. 2.3. Industry profiles
The main idea for developing this business is due to the rapid development in the construction industry. This would give an opportunity for our company to provide furniture to the houses after the construction project finish. 2.4. Location of Business
Fa Fa Furniture is located at No 4E, Oya Road, 96000, Sibu, Sarawak. We chose this location because it is strategic location that many construction projects are running around this area. Other than that this location may became busy residence area. 2.5. Date of Commencement
Our company will commence operations on 1st January 2013. 2.6. Factors in selecting the proposed venture
We chose this business because there is a high demand in the housing industry. We believe that we can compete with other competitors around Sarawak. We also believe that our company will became a source of reference for entrepreneurs in the same field. 2.7. Future prospects of the business
Our future plans for this business is open more branches in Sarawak. Besides that, we also hope that we can get full support from government and non-government associations.

2. Purpose of Preparing the Business Plan
This business plan is prepared by Fa Fa Furniture for the purpose of obtaining working capital loan from May Bank for an amount of RM120,000. This business plan is also prepared as a guideline for managing the business.

3. Business/Company Background
Name of the business: Fa Fa Furniture.
Business address: No 4E, Oya Road, 96000, Sibu, Sarawak
Correspondence Address: P.O.BOX 044 Lily Road
Telephone number: 013-808-1316
Fax number: 084-329912
E-mail address: triplefff@gmail.com
Form of business: Partnership
Main activitie(s): Produce and sell wooden furniture
Date of Commencement: 1st January 2013
Date of registration: 1 June 2012
Registration number: A-300123
Initial(own)capital: RM 120,000
Name of Bank: May Bank
Bank account number: 1213-0304-1239-4568

4.0 Background of Partners
4.1 Personal Particulars of Partner 3: i. Name of owner/partners/directors: Joy Ting Hua Choon ii. Identity card number of the owner/partners/directors: 941120-13-5861 iii. Permanent address of the company: No 4E, Oya Road, 96000, Sibu, Sarawak. iv. Correspondence address: P.O.BOX 123 Lanang Road v. Website address: www.fafa-furniture.com.my vi. E-mail address: joythc@gmail.com vii. Telephone number: 013-808-1316 viii. Date of birth: 20-11-1994 ix. Age: 20 x. Academic qualification: Degree in Business Studies xi. Courses attended: Entreprenuership Course xii. Skills: Communication skill and excellent leadership xiii. Experience: Nil xiv. Present occupation: General Manager xv. Capital contribution: RM20,000.00
Personal Particulars of Partner 2: i. Name of owner/partners/directors: Steven Ngui Moh Huo ii. Identity card number of the owner/partners/directors: 940806-13-6047 iii. Permanent address of the company: No 4E, Oya Road, 96000, Sibu, Sarawak. iv. Correspondence address: P.O.BOX 022 Salim Road v. Website address: www.fafa-furniture.com.my vi. E-mail address: stevennmh@gmail.com vii. Telephone number: 013-909-7890 viii. Date of birth: 06-08-1994 ix. Age:20 x. Academic qualification: Major in finance xi. Courses attended: Entreprenuership Course xii. Skills: Experience as a Decision provider, financial analyst xiii. Experience: 1 years as financial manager in Company Win xiv. Present occupation: Financial Manager xv. Capital contribution: RM20,000.00
Personal Particulars of Partner 3: i. Name of owner/partners/directors: Tong Chung Kieng ii. Identity card number of the owner/partners/directors: 941029-13-6281 iii. Permanent address of the company: No 4E, Oya Road, 96000, Sibu, Sarawak. iv. Correspondence address: P.O.BOX 044 Lily Road v. Website address: www.fafa-furniture.com.my vi. E-mail address: tongck@gmail.com vii. Telephone number: 013-909-7788 viii. Date of birth: 29-10-1994 ix. Age: 20 x. Academic qualification: Degree in Finance xi. Courses attended: Entreprenuership Course xii. Skills: Employee Management and Inventory Analysis xiii. Experience: 1 years as operation manager in Company Victory xiv. Present occupation: Operations Manager xv. Capital contribution: RM20,000.00

Personal Particulars of Partner 4: i. Name of owner/partners/directors: Lau Hui Sin ii. Identity card number of the owner/partners/directors: 931126-13-6188 iii. Permanent address of the company: No 4E, Oya Road, 96000, Sibu, Sarawak. iv. Correspondence address: P.O.BOX 219 Aman Road v. Website address: www.fafa-furniture.com.my vi. E-mail address: lauhs@gmail.com vii. Telephone number: 013-909-4049 viii. Date of birth: 26-11-1993 ix. Age: 21 x. Academic qualification: Bachelor Degree xi. Courses attended: Entreprenuership Course xii. Skills: Good knowledge about Furniture business xiii. Experience: 1 years as Supervisor in Company Xerox xiv. Present occupation: Production Supervisor xv. Capital contribution: RM20,000.00
Personal Particulars of Partner 5: i. Name of owner/partners/directors: Sia Siew Lim ii. Identity card number of the owner/partners/directors: 940617-13-5942 iii. Permanent address of the company: No 4E, Oya Road, 96000, Sibu, Sarawak. iv. Correspondence address: P.O.BOX 037 Sentosa Road v. Website address: www.fafa-furniture.com.my vi. E-mail address: ssl@gmail.com vii. Telephone number: 013-991-9192 viii. Date of birth: 17-06-1994 ix. Age: 20 x. Academic qualification: Degree in Accounting xi. Courses attended: Entreprenuership Course xii. Skills: Skill in accounting xiii. Experience: 1 years as Accountant in Company Yien xiv. Present occupation: Accountant xv. Capital contribution: RM20,000.00
Personal Particulars of Partner 6: i. Name of owner/partners/directors: Ling Wei Wei ii. Identity card number of the owner/partners/directors: 940525-13-5996 iii. Permanent address of the company: No 4E, Oya Road, 96000, Sibu, Sarawak. iv. Correspondence address: P.O.BOX 009 Wong King Huo Road v. Website address: www.fafa-furniture.com.my vi. E-mail address: lingww@gmail.com vii. Telephone number: 013-976-4680 viii. Date of birth: 25-05-1994 ix. Age: 20 x. Academic qualification: Diploma in Legal Secretaries xi. Courses attended: Entreprenuership Course xii. Skills: Technology Skills and Writing Skills xiii. Experience: 2 years as Secretary in Company Ziza xiv. Present occupation: Secretary xv. Capital contribution: RM20,000.00

4.2 Partnership Agreement
The attached agreement is made and signed by all partners stated below. This agreement is witnessed by a solicitor and defendant that have been appointed for this purpose. Below are the details of the agreement.
4.2.1 Name of the business Fa Fa Furniture
4.2.2 Form of business Partnership
4.2.3 Location of business No 4E, Oya Road, 96000, Sibu, Sarawak
4.2.4 Equity contribution The capital of our business is RM120,000.00 and the equity contributions are as follows:
Joy Ting Hua Choon RM20,000.00
Steven Ngui Moh Huo RM20,000.00
Tong Chung Kieng RM20,000.00
Lau Hui Sin RM20,000.00
Sia Siew Lim RM20,000.00
Ling Wei Wei RM20,000.00

4.2.5 Financial matters
The profit and loss of the company is distributed among the shareholders according to the percentage of their capital equity.
If one of the shareholders is declared bankrupt or has many liabilities or has been proven cheating, all the other shareholders have the right to remove the guilty shareholder.
If a shareholder does not want to continue his or her involvement in the company, his or her capital will be given back after the profit and loss of the company has been taken into consideration.
The financial manager keeps all the accounts and all shareholders are allowed to view the accounts.
4.2.6 Management and position
Joy Ting Hua Choon - General Manager Steven Ngui Moh Huo - Finance Manager
Tong Chung Kieng - Operations Manager
Lau Hui Sin - Production Supervisor
Sia Siew Lim - Accountant
Ling Wei Wei - Secretary

4.2.7 Death and dissolvement
Dissolvement depends on the agreement of all the shareholders in matters concerning death or loss of sanity. However, the shareholder should get the profit or capital until the shareholder quits.

4.2.8 Labour rights
All shareholders should acknowledge the rights of staff according to the law.

4.2.9 Other matters
Dismissed notice should be given by the shareholder who wishes to quit from the business within 30 days from dismissed date and agreed by other shareholders. The contribution by the shareholder can be claimed whether the company gains profit or loss depending on the ratio of contribution. This dismissal will be ecforced within 24 hours of notice.
4.2.10 Signatures of shareholders:
Joy Ting Hua Choon Joy
Steven Ngui Moh Huo Ngui
Tong Chung Kieng tck
Lau Hui Sin LHS
Sia Siew Lim SSL
Ling Wei Wei Wei

5.0 Background of the Proposed Project
Fa Fa Furniture has chosen Sibu, Sarawak as the location for selling its products and services. The following section will explain the details of the chosen location.
5.1 Physical location
Our premise is located along the main rod which is undergoing development. The area has been designated by the state as an Enterprise Zone, thus offering us benefits and incentives to set up our operation. Many commercial buildings are being constructed along this road. Our building is a new building, As such, it is in good condition and is well-maintained. The size is 1,745 sq. ft. and consists of two areas, which are the office and store. So, it’s suitable with the furniture business.
5.2 Price of premise
We are renting the premise with a rental rate of RM3,000.00 per month.

5.3 Distance from the source of raw materials
This location was chosen because of its proximity to both road and rail transportation, where the cost of production and transportation can be at a minimum level. The sources of our raw materials are located in Sibu and Mukah, therefore the proximity to both public transportation systems ensure that our raw materials are made available to us within a relatively short distance and at minimal cost.
5.4 Availability of manpower
The location we chosen offer a steady supply of multilingual workforce from Indonesian and local worker. Hence, we have the capacity to increase or decrease manpower depending on the job size and schedule.
5.5 Transportation Facilities
Customers can reach our premises by two types of public transportation, i.e. by bus or taxi. Public transportation such as buses and taxis are easily accessed in Sibu.
5.6 Distance from customers
Our business is located near to several housing areas in Sibu, with the closest being only 1 km away from our location, which makes it very easy to frequent.
5.7 Basic amenities (electrical, water, and telephone facilities)
Our office is completed with water and electricity suppliers, internet connection, and telephone lines. These basic amenities are provided in order for all workers to perform and accomplish their jobs more efficiently and productively.

6.0 Organization/Administration/Management Plan
FFF
6.1 Organization’s logo, vision, mission, and objectives
Logo:

Vision: To become a company that successful in manufacturing and selling furniture in Malaysia.
Mission: Our mission is simple. That is to provide good and best quality furniture to the customers. We also offer our customer gets what he/she wants; furniture that fits the customer's space, taste, budget and style preference, from top to bottom!
Objectives: Create relationships with designers of unique, fine furniture. Establish relationships with good quality wholesale suppliers of timber and hardware. Set up our name and image in the community as a specialty manufacturer of custom designed furnishings within the next three years. To sell some different designs of furniture.

6.2 Organizational chart/structure
Fa Fa Furniture uses an organizational structure based on functions in the organization. The firm is divided into finance, operation and accounting. This structure suits Fa Fa Furniture as this organization emphasizes functional specialties to perform tasks. The organizational structure will cover all aspects of the management as a business entity .Figure 1.1 illustrates our proposed structure.
Figure 1.1
6.3 Manpower planning
Fa Fa Furniture has six partners and they manage, contract and execute the operations of the business as show in Table 6.3. Fa Fa Furniture has one general manager, one financial manager, one operations manager, one production supervisor, one secretary and one accountant. Position | Number of Personnel | General Manager | 1 | Financial Manager | 1 | Operations Manager | 1 | Production Supervisor | 1 | Secretary | 1 | Accountant | 1 |
Table 6.3

6.4 Schedule of tasks and responsibilities
Each manager has his responsibilities to execute the operations of the business. It is very important for every manager to know his tasks and responsibilities in the company as it will guide him in accomplishing his job. Table 6.4 describes the tasks and responsibilities have been identified and will be delegated to the respective individual to ensure the smooth operation of the business. Task/Position | Responsibilities/Job Description | General Manager | * Builds company image by collaborating with customers, government, community organizations, and employees; enforcing ethical business practices. * Maintains quality service by establishing and enforcing organization standards. * Providing educational opportunities. | Financial Manager | * Managing a company's financial accounting, monitoring and reporting systems * Arranging new sources of finance for a company's debt facilities | Operations Manager | * Coordinate, manage and monitor the workings of various departments in the organization * Manage customer support * Plan and support sales and marketing activities | Production Supervisor | * Developing personal growth opportunities * Maintains quality service by establishing and enforcing organization standards * Maintains working relationship with the union by following the terms of the collective bargaining agreement | Secretary | * Maintain databases * Manage office supplies * Maintain schedules and calendars | | | Accountant | * Prepares asset, liability, and capital account entries by compiling and analyzing account information * Documents financial transactions by entering account information |
Table 6.4

6.5 Remuneration plan
For our company, we have chosen the EPF scheme to given to all employees. EPF is a compulsory savings for employees so that they will have money to support themselves once they retire. As a general guideline, employers are required to contribute at least 12% of an employee’s basic salary. Fa Fa Furniture also provides Social Security Organization (SOSCO) contributions to ensure that employees receive compensation in situation of work-related accidents or illnesses. Table 6.5 illustrates the remuneration plan for each employee in Fa Fa Furniture. Position | Number Of Employees | Remuneration per month/Monthly Salary(RM) | EPF Contribution (12%) (RM) | SOSCO (2%)(RM) | Total (RM) | General Manager | 1 | 3,000.00 | 360.00 | 60.00 | 2,580.00 | Financial Manager | 1 | 2,800.00 | 336.00 | 56.00 | 2,408.00 | Operations Manager | 1 | 2,750.00 | 330.00 | 55.00 | 2,365.00 | Production Supervisor | 1 | 2,500.00 | 300.00 | 50.00 | 2,150.00 | Secretary | 1 | 1,500.00 | 180.00 | 30.00 | 1,290.00 | Carpenter | 2 | 1,500.00 | 180.00 | 30.00 | 1,290.00 | Accountant | 1 | 1,800.00 | 216.00 | 36.00 | 1,548.00 | Store Assistant | 1 | 650.00 | 78.00 | 13.00 | 559.00 | Lorry Driver | 1 | 900.00 | 108.00 | 18.00 | 774.00 | Total | 10 | 17,400.00 | 2,088.00 | 348.00 | 14,964.00 |
Table 6.5
In addition to our managing employees, our company has hired one warehouse assistants. The assistants will be paid RM650 each month as basic salary and will contribute RM78 to the Employees Provident Fund (EPF) and RM13 for SOSCO. A lorry driver has also been hired to work for our company and he will pay RM900 per month. He will contribute RM108 for EPF and RM18 for SOSCO. Besides that, our company also hired 2 carpenters. Every one of them will be paid RM750 each month as basic salary, then contribute RM90 for EPF and RM15 for SOSCO. Therefore, the total monthly salary of all Fa Fa Furniture employees is RM17400.00

6.6 List of office equipment and supplies
Fa Fa Furniture has bought office furniture fitting and equipment from Sing Yang Furniture Mall as listed in Table 6.6 below. We bought six sets of office furnitures, a desk and chair for the reception area, six personal computers, and a whiteboard for the meeting room. OFFICE EQUIPMENT AND FURNITURE | NO. | Type of Equipment | Quality | Price Per Unit (RM) | Total (RM) | 1. | Office Furniture | 6 | 280.00 | 1680.00 | 2. | Personal Computer | 6 | 1,500.00 | 9,000.00 | 3. | Whiteboard | 1 | 300.00 | 300.00 | 4. | Reception area furniture | 1 | 350.00 | 350.00 | TOTAL | 11,330.00 |
Table 6.6

6.7 Administrative budget
Aside from furniture fitting and equipment, Fa Fa Furniture also purchased office supplies such as stationery and paper for the company as indicated in Table 6.7.The administrative budget also includes rental for land to be paid every month to the Sing Yang Furniture Mall. A rental deposit equal to three months’ rent and utilities deposit for water, telephone and electricity are also included. ADMINISTRATIVE EXPENDITURE | | RM | RM | Fixed Assets/Capital expenditure | | | Furniture and fittings | 11,330.00 | | | | 11,330.00 | Working Capital/Monthly expenditure | | | Salary | 17,400.00 | | Office supplies | 2,800.00 | | Rental | 3,000.00 | | Utilities | 1,000.00 | | | | 24,200.00 | Other Expenditures | | | Rental deposit | 4,000.00 | | Utilities deposit | 1,750.00 | | | | 5,750.00 | Total | | 41,280.00 |
Table 6.7

7.0 Marketing plan / Analysis
7.1 Description of products or services
Our company offer products for the bedroom, living and dining room, and the storage room. Products include Bed, Sofa, Dining table, Dressing table. We made the furniture in various types and various design. We also can design based on customers’ needs.
7.2 Target market
Our target market is a person who wants to have very fine furniture with the latest in technology, combined with an old fashioned sense of fine woods and fine woodworking. We also aggressively market our target customers who live in the Sibu area likes Young working families, young adults and rich people.
7.3 Market size
There are two major market segments within this target area. The first segment is the office owners around Sibu, Sarawak and Second segment is the owners of houses and buildings within area.
The first segment consists of 3500 to 5000 offices that use furniture in their design. The second segment is about 2000 to 3000 house owners buy furniture to decorate their house. A survey showed that the first segment makes purchases of about RM80000 each month and the second group spends about RM9000 per month. We estimated the potential sales for the year as RM 1068000 (RM89000 X 12 months). All the data was obtained using three methods. Firstly, we made an observation of the market size of the business. Secondly, we interviewed a person in charge and receptionist at the Registration Department and the Statistics Department to get further information. Lastly, we used questionnaires to get some information in order to build our marketing plan.
7.4 Competitors (strengths and weakness)
Being the fifth company to involve in manufacturing furniture in Sibu, Fa Fa Furniture has to complete with several existing competitors. Table 7.4 shows the strengths and weaknesses among the Competitors.
Table 7.4 Competitors’ strengths and weaknesses Competitors | strengths | weaknesses | Hatil ComplexFurniture | Good marketing, strong advertising budget, relationships with distributors, and strong direct sales. | The product is more standardized, and of lesser quality, with less sense of design and materials and workmanship | Akhtar Furnishers | Financial backing and produce good quality product | Akhtar Furnishers not seemed to understand where to find the buyers, how to market as a specialty niche instead of the more traditional furniture channels. | Ben Manufacturing | Experienced workers perform an excellent job | Not many types of product offered | Star Furniture | Has built a good relationship in the industry | New to the industry, still in the stabilizing phase |

7.5 Market Share
Fa Fa Furniture specializes in the ceramic industry. Located in the golden triangle of an industrial area in Sibu, the target market for this business is formed mainly by developers and contractors. We are not able to identify the actual market share for our business as the data is ambiguous. However, we have taken our market share as 10% of the number of population in the age of 25-65 years old who live or work in Sibu and the surrounding areas particularly in Bandar Baru Salak as shown in Table 7.5.

Table 7.5 Market Share before and after the entry of Fa Fa Furniture Competitors | Before Entrance | Adjusted Market After Entrance | | Percentage of market share | Amount (RM) | Percentage of loss of market share | Percentage of market share | Amount (RM) | Hatil ComplexFurniture | 20% | 30,000 | 2% | 18% | 27,000 | Akhtar Furnishers | 20% | 30,000 | 2% | 18% | 27,000 | Ben Manufacturing | 25% | 37,500 | 2% | 23% | 34,500 | Star Furniture | 35% | 52,500 | 4% | 31% | 46,500 | Fa Fa Furniture | - | | | 10% | 15,000 | TOTAL | 100% | 150,000 | | 100% | 150,000 |

7.6 Sales forecast
The sales forecast of the competitors and Fa Fa Furniture is shown in table 7.6. Month | Sales Forecast | | RM | | Hatil ComplexFurniture | Akhtar Furnishers | Ben Manufacturing | Star Furniture | Fa Fa Furniture | January | 50,000 | 40,000 | 40,000 | 40,000 | 39,000 | February | 55,000 | 42,000 | 45,000 | 44,000 | 42,000 | March | 48,000 | 41,000 | 42,000 | 40,000 | 42,000 | April | 44,000 | 37,000 | 41,000 | 39,000 | 42,000 | May | 55,000 | 43,000 | 46,000 | 51,000 | 49,000 | June | 50,000 | 39,000 | 44,000 | 46,000 | 45,000 | July | 45,000 | 35,000 | 43,000 | 47,000 | 44,000 | August | 57,000 | 39,000 | 40,000 | 42,000 | 40,000 | September | 45,000 | 34,000 | 42,000 | 41,000 | 38,000 | October | 38,000 | 30,000 | 55,000 | 49,000 | 46,000 | November | 50,000 | 36,000 | 46,000 | 47,000 | 48,000 | December | 55,000 | 40,000 | 57,000 | 52,000 | 46,000 | Total | 592,000 | 456,000 | 541,000 | 538,000 | 521,000 |
Table 7.6

7.7 Marketing strategy
The marketing strategy of Fa Fa Furniture is summarized in table 7.7. Criteria | Description | Product strategy | Quality | Fa Fa Furniture provides good quality furniture to our customers. The quality is observed in terms of : 1 Design 2 Packaging 3 Workmanship 4 High quality woodworking 5 Attractiveness 6 Professional materials | | Delivery services | We provide delivery services for customers who buy our product. | Pricing Strategy | Competition based pricing | Fa Fa Furniture uses competition-based pricing as its pricing strategy. We have competitors in Sibu that sell the same products for a higher price to get more profit per unit. However, we at Fa Fa Furniture place greater importance on customer satisfaction for repeat business. We have reduced the price per unit of our products and are still able to get reasonable profit from our sales. Our competitive will ensure customers continue buying from us in the future and also attract new customers. | Distribution Strategy | Second channel(Manufacturer -> Retailer -> Consumer) | Fa Fa Furniture uses the second channel as our distribution strategy. As a manufacturing company, we will distributes the goods through retailers and sell them to consumers. | Promotion Strategy | Advertising | As for our promotion strategy, Fa Fa Furniture uses the advertising method as the first step in promoting our business. We use different sources to communicate our target marketing likes Internet, Television, Radio, and Newspaper. We will use those sources on that the more customer attract like Local Cable, Newspapers, Billboard and when they lunch any scheme in Furniture they use pamphlets to aware their customer. We also use the channel to attract the customer and give fully information about Furniture through these Electronic media. We promotion our product to give advertise in television, radio. We also use vehicle writing method and posturing for our product advertisement. |
Table 7.7

7.8 Marketing Budget
The marketing budget of Fa Fa Furniture includes capital, monthly, and other expenditures as shown in table 7.8.

MARKETING EXPENDITURE | | RM | RM | Fixed Assets / Capital expenditure | | | Signboard | 3,000.00 | | Motor vehicle | - | | Office equipment | - | | | | 3,000.00 | Working Capital/Monthly expenditure | | | Salaries | - | | EPF & SOCSO | - | | Fuel and man | - | | Travelling expenses | 750.00 | | Utilities | - | | | | 750.00 | Other Expenditure | | | Promotion | 4,000.00 | | Grand Opening | 6,000.00 | | | | 10,000.00 | TOTAL | | 13,750.00 |
Table 7.8

8.0 Operational Plan
8.1 Operational process
To date, we have completed our market research and a lease has been secured at the selected location in Sibu Area. Equipment and furniture purchases have been pre-negotiated. Marketing materials have also been drafted.
8.1.1 Sign building lease within 30 days
8.1.2 Sign equipment and office furniture purchase order
8.1.3 Accept delivery of equipment and office furniture
8.1.4 Receive equipment training and set up
8.1.5 Print marketing material
8.1.6 Open business
8.1.7 Launch advertising and promotional plan

8.2 Process flow chart
A flow chart that summarizes the operational process.
Order timber from suppliers Settle shipping and delivering of timber Merchandise inspector (MI) to check quantity and quality of delivered timber
Receive delivered timber and stored them in the warehouse

Timber taken out from warehouse and measure to ensure sizes and moisture content is within requirements Cutting & Molding the timber into sizes required

Finishing & Packing the product

Finished products will be delivery according to customer's order

8.3 Production schedule * Table below shows the production schedule or capacity planning for Fa Fa Furniture based on monthly production. No. | Time of production | Quantity of production | 1 | Monthly production | 2500 pieces of timbers per month |

8.4 Material requirement * We calculated that our material requirement based on our sales per month. Our monthly sale is approximately 2750 pieces of timber. The cost of a piece of timber is RM40.

Material Requirement | No. | Item | Quantity Required | Safety Stock | Price per unit(RM) | Supplier | Total Amount(RM) | 1 | Timber | 2750 pieces | | 40.00 | | 110,000.00 | 2 | | | | | | | 3 | | | | | | | Total | | 110,000.00 |

8.5 Machine and equipment
Two wood cutting machine is required in our operations to manufacture the furniture. The cost of one wood cutting machine is RM25,000. The costs of the items are indicated in the table below. Machine and Equipment | No. | Particulars | Quantity | Price per unit(RM) | Total Amount(RM) | 1 | Wood Cutting Machine | 2 | 25,000.00 | 50,000.00 | 2 | | | | | 3 | | | | | Total | | 50,000.00 |

8.6 Operation layout plan
The operation layout plan of Fa Fa Furniture is shown below in Figrue 8.6. Manufacturing process place | Warehouse | Toilet | Office | | | Prayer room | | | | | | Display area | Display area | Display area | | Door | |
Figrue 8.6

8.7 Operational budget Operational Expenditure | Fixed Assets / Capital Expenditure | RM | RM | Wood Cutting Machine | 50,000.00 | | | | | | | 50,000.00 | Working Capital / Monthly Expenditure | | | Timbers | 15,000.00 | | Carpenter Salary | 3,000.00 | | Lorry Driver Salary | 900.00 | | Store Assistance Salary | 650.00 | | Utilities (Overhead cost) | 2,000.00 | | | | 21,550.00 | | | | | | | Total | | 71,550.00 |

9.0 Financial Plan
A financial plan is important for the overall success of Fa Fa Furniture because it helps to * Determine the size of investment that is the project implementation cost. * Identify and propose the relevant sources of finance. * Ensure that initial capital is sufficient. * Appraise the viability of the project before actual investment is committed. * Guide the implementation of plans.

9.1 Project implementation cost schedule Project Implementation Cost | Requirements | Cost | | RM | RM | Fixed Assets | | | Land & Building | 5,000.00 | | Furniture & Fittings | 11,330.00 | | Wood Cutting Machine | 50,000.00 | | Motor Vehicle (Lorry) | 25,000.00 | | Subtotal | | 91,330.00 | Working Capital | | | Administrative | 2,500.00 | | Utilities | 1,000.00 | | Subtotal | | 3,500.00 | Marketing | | | Promotional Cost | 20,000.00 | | Subtotal | | 20,000.00 | Operations | | | Overhead Cost | 24,000.00 | | Subtotal | | 24,000.00 | Other Expenditure | | | Pre-operating | | | Business registration | 150.00 | | Subtotal | | 150.00 | Deposits | | | Utilities (Telephone/Water/Electricity) | 2,000.00 | | Rental | 4,000.00 | | Subtotal | | 6,000.00 | Total | | 144,980.00 | Contingencies (10%) | | 14,498.00 | Grand Total | | 159,478.00 |
Table 9.1: Project Implementation Cost Schedule

9.2 Source of finance Fa Fa Furniture Schedule of Financial Sources as at Year 2014 | Sources | Amount (RM) | A. Equity / Own Contribution | | Cash | 120,000.00 | | | B. External Source | | Bank Loan | 200,000.00 | C. Others | 0.00 | | | Total | 320,000.00 |
Table 9.2: Schedule of financial sources

9.3 Pro Forma Cash Flow Statement
Table 9.3 shows the pro forma cash flow statement of Fa Fa Furniture throughout the planned period. Fa Fa Furniture Pro Forma Cash Flow Statement For Year End 31 December 2014 | Cash Inflows | Total(RM) | Owner`s Capital (cash) | 120,000.00 | Bank Loan/ Term Loan | 200,000.00 | Cash Sales | 421,000.00 | Total Cash Inflows | 741,000.00 | | | Cash Payment | | Capital Expense | | Machinery/Equipment | 50,000.00 | Furniture & Fittings | 11,330.00 | Lorry | 25,000.00 | Renovation | 10,000.00 | Administrative Expense | | Salaries | 208,800.00 | EPF & SOCSO | 29,232.00 | Administrative Overhead | 6,000.00 | Rental | 36,000.00 | Marketing Expense | | Promotion | 20,000.00 | Operational Expense | | Raw Material | 110,000.00 | Direct Labour | 29,872.00 | Operational Overhead | 6,000.00 | Financial Expenses | | Principal | 50,123.00 | Interest Loan Repayments | 8,000.00 | Other Expenses | | Deposit | 6,000.00 | Total Cash Outflows | 606,448.00 | Excess/(Deficit) | 134,552.00 | Opening Balance | 0.00 | Ending Balance | 134,552.00 |
Table 9.3: Pro Forma Cash Flow Statement

9.4 Pro Forma Income Statement
Table 9.4 shows the pro forma income statement of Fa Fa Furniture. Fa Fa Furniture Pro Forma Income Statement For Year End of 31 December 2014 | | RM | RM | Sales | | 521,000.00 | Less: Cost of Sales | | | Opening Stock | 0.00 | | Purchase | 110,000.00 | | Closing Stock | (12,000.00) | (98,000.00) | Gross Profit | | 423,000.00 | Less: Expenditure/Operating Expenses | | | Administrative Expenditure | 280,123.00 | | Marketing Expenditure | 20,000.00 | | Operation Expenditure | 145,872.00 | | Financial Expenditure | 58,123.00 | | Other Expenditure | 6,000.00 | | Total Expenditure/Operation Expenses | | (510,118.00) | Loss Before Tax | | (87,118.00) | Tax | | - | Net Loss After Tax | | (87,118.00) | Table 9.4: Pro Forma Income Statement

9.5 Balance Sheet Statement/Statement of Finance Report Table 9.5 shows the pro forma balance sheet statement at 31 December 2014. Fa Fa Furniture Pro Forma Balance Sheet Statement For Year End 31 December 2014 | | RM | RM | Assets | | | Non-current Asset | | | Furniture & Fittings | 11,330.00 | | Motor Vehicle | 25,000.00 | | Machine | 50,000.00 | 86,330.00 | Current Assets | | | Inventory | 12,000.00 | | Cash Balance | 134,552.00 | | | | 146,552.00 | | | | Total Assets | | 232,882.00 | | | | Equity & Liabilities | | | Owner`s Equity | | | Capital | 120,000.00 | | Profit/(Loss) | (87,118.00) | 32,882.00 | Long Term Liabilities | | | Term Loan | 200,000.00 | | | | 200,000.00 | Total Equity & Liabilities | | 232,882.00 | Table 9.5: Pro Forma Balance Sheets Statement

10.0 Conclusion
As a conclusion, Fa Fa Furniture is a company that wants to make it in the housing industry. This company can work side by side with others companies in the housing industry as well. Furthermore, Fa Fa Furniture has increased its efforts in varying innovative activities in terms of technology research and designs the furnitures. This approach is important to capture the local market. In connection with that, we aim to supply furniture according to our customer’s desires. We will continuously strive and cooperate closely with various government agencies and private sectors to be a successful company. Based on the planning and projection of income and expenses, we are very confident that this business venture will create a very satisfactory return on investment from the second operation.
By following this plan, we will reach our company goals. We provide the best quality furniture to our customers and also different designs based on customers wants. For the first years, our company has a loss but we believe that second year will be a profit.

11.0 Appendices * Letters expressing interest to buy the product or services. * Questionnaires used to collect data as part of marketing research. * Resumes of the key management team and key technical advisors. * Price list of competitors. * Promotional brochures or advertisements that describe the product and services.