Papa Chigo's Custard: A Business Plan for Custard Production in Aba

This document presents a business plan for Papa Chigo’s Custard, a sole proprietorship focused on producing and selling custard powder in Aba, Abia State, Nigeria. The plan details the company's executive summary, business overview, vision, mission, and objectives, highlighting its commitment to producing nutritious, quality custard while complying with NAFDAC standards. It includes a market analysis identifying target clients such as home users, traders, and celebrants, and outlines the company's marketing strategies, product descriptions, and customer service approach. The plan also covers operational aspects, including the description of the production location, raw materials, equipment, production costing, and pricing strategy. Financial projections indicate an initial investment of N178,300 with expected annual revenues of N2,270,400, aiming for profitability within the first year and significant growth in subsequent years. The plan seeks supplemental financing to cover start-up expenses and the first year of operations, emphasizing the company's competitive edge through affordable pricing, home services, and entrepreneurship training.

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BUSINESS PLAN
FOR
CUSTARD
PRODUCTION

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EXECUTIVE SUMMARY
Custard powder is a powdery meal for Nigerians, especially those in the urban areas.
Due to its aesthetic look, good taste and short time of preparation, the product has found
place on many breakfast tables. As a result of the continuous rural – urban drift and the
eating habits of most urban dwellers in Nigeria, this product has continued to command
high demand. Therefore, the establishment of its business/product will yield more
income considering the fact that it does not require much capital for start-up. It is on
this basis that this intending business is to be established.
However, this intending business shall be a registered business with Corporate Affairs
Commission, the business shall be called Papa Chigo’s Custard. The intending location
shall be at No. 30 Hospital Road, Aba-Abia State. The choice of this location is due to
the area is at the centre of Aba South LGA where there are much buyers of custard.This
intending business shall be useful to the society in that it will create employments to residents,
it will generate revenue to government treasury and shall promote the nutrition standards of the
people. This business plan is prepared to obtain financing in the amount ofN178,300 per
production and a revenue of N189, 200 per production which is estimated to be running
on monthly basis and a total of N2, 270, 400 per annum.
The supplemental financing is required to begin work on the rented shop for preparation and
modifications, equipment purchases, and to cover expenses in the first year of operations. The
financing, in addition to the capital contributions from the owner and friends will allow Custard
producers to successfully open and maintain operations through year one.
The target clients of Papa Chigo’s Custard shall include Home users, fast food centres, eateries,
artisans, residents. The competitive edge of Papa Chigo’s Custard shall be having ability to
offer her products at a competitive price to enable the poor and rich to benefits from the
nutritional standard of the products; offering of home services to meet the demand of middle
to higher- income local market area residents; households and training/raising of intending
entrepreneurs in custard production. The company is privately owned by Mr. Anene Chigozie
Sylvester and will be operated as a sole proprietorship business. The company hopes to create
a new niche at the end of the first 2-4years which will lead to increase in sales to about 50%.
The first year sales is expected to increase to N400, 000 and increase to about N600, 000 by

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the end of the 2-4 years. The first year will mark the first profit with expected profits rising
significantly by the end of the third year.
BUSINESS OVERVIEW
Custard is a variety of culinary preparations based on a cooked mixture of milk or cream
and egg yolk. Depending on how much egg or thickener is used, custard may vary in
consistency from a thin pouring sauce to a thick pastry cream used to fill éclairs. Most
common custards are used as desserts or dessert sauces and typically include sugar and
vanilla. Sometimes flour, corn starch, or gelatin is added as in pastry cream or crème
pâtissière. Custard is usually cooked in a double boiler (bain-marie), or heated very
gently in a saucepan on a stove, though custard can also be steamed, baked in the oven
with or without a water bath, or even cooked in a pressure cooker. Custard preparation
is a delicate operation, because a temperature increase of 3–6 °C (5–10 °F) leads to
overcooking and curdling. Generally, a fully cooked custard should not exceed 80 °C
(176 °F); it begins setting at 70 °C (158 °F). A water bath slows heat transfer and makes
it easier to remove the custard from the oven before it curdles. Papa Chigo’s Custard
shall be a sole proprietorship and it shall be established in June, 2019 after been registered.
The firm is expected to be a leading firm in the production of quality and nutritious custard
powder within the vicinity; our target clients include home users, celebrants, commercial usage.
VISION AND MISSION
Papa Chigo’s Custard’s mission include the following:
a) To be a leading producer of nutritious and quality custard powder in the area
b) To comply strictly with NFADAC Standards in food production
c) To add value through innovation and creativity,
Objectives
The following are the objectives of Papa Chigo’s Custard:
i) To make profit of N500,000 within 3 years of operation
ii) To expand the business in all aspects of business development,
iii) To open up more additional branches in Aba and Its environs within two (2) years
in business

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iv) To create employment to the masses
CRITICAL SUCCESS FACTORS OF THE BUSINESS
Value Proposition
Papa Chigo’s Custard is determined to reach high level of maximum profit level. The company
will start up with manual operation but as the business matures, we shall upgrade to the use
well advanced machines such as mixers and enhanced machines for production of nutritious
custard products. The industry will be a medium firm and it will be faced with the production
of different custard products.
The uniqueness of my liquid soap product is clearly noticed in it’s:
a) Mildness
b) High quality
c) Package design
Current Status of the Business
The start-up summary; Papa Chigo’s Custard will be needing a start-up capital of N178, 300,
65% of the start-up capital will be raised by the sole proprietor while the remaining 35% will
be sourced through bank loan. The business will be starting up June, 2019. Good marketing
strategies and reliable advertising strategy such as complimentary cards and fliers have also
been printed and distributed in different places informing the public about the company which
will be established from.
LEGAL REQUIREMENT
The organization will be registered alongside with the following bodies and it is assumed that
the following are the required amount for registration in the respective authourities:
Legal Requirement Amount to be spent
NAFDAC 5,000
Corporate Affairs Commission 5,000

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Contribution to local and National Economy
Papa Chigo’s Custard is determined to improve the health of the public. The public has great
things to benefits from production of custard products of this great firm. Papa Chigo’s Custard
when established will provide many levels of services to cater for large and small corporations
along with making it affordable for middle and upper socioeconomic classes.
Marketing Plan, Product and Service Description, Customer Service
Papa Chigo’s Custard will provide its service to students, teachers, tea-centers, restaurants,
home users, and government agencies who want to host one occasion or the other, domestic
and international markets. Although we are going to cater to a relatively broad scope of
customers, the company will decide the target market based on sales and trends experienced in
the initial months of operation. Potential clients of Papa Chigo’s Custard is broken down into
categories
1. Home users
2. Traders
3. celebrants
Product description
Papa Chigo’s Custard will engage in the production of custard products of various brands
ranging custard formulated with milk-flavoured, soybean, strawberry-flavoured, sugar and
other vital supplement rich in vitamins and minerals at affordable prices also.
Services description
Papa Chigo’s Custard shall be considered as an enterprise that reaches the expectation of her
customers through provision of the following;
 A tranquil and stimulating environment for production of quality products
 By reaching out to my customers at home and at their different eateries when they need
my home delivery service.
Customer service
I intend to display my products as well as engage in promo activities for my customers for the
beginning of the production. If the need for discount arises, I shall also adopt it.

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Target market
Having said before that my target markets are students, workers and even business men and
women that is why the business is located at the heart of the town. I have tried to envisage a
situation where the desire to achieve good cleansing and sanitizing effects will be satisfied.
This entails the students, workers and business personnel, working class personnel in the town
where the enterprise is located, the travellers who stop at canteens for some minutes during a
long journey and as well for families living around who desire the best for their family
members.
Market Analysis
Product Services Important Features Competitive comparison
Strawberry custard This is unique in taste and nature
because of its strawberry
composition/make up
Our marketing strategies will be unique
in order to withstand competition in the
market
Milk-flavoured
custard
This is special because of it make-
up is majorly prepared with milk
flavour
Our marketing strategies will be unique
in order to withstand competition in the
market
Sunset yellow Custard This is type of custard is yellow in
colour and command taste
Our marketing strategies will be unique
in order to withstand competition in the
market
Customer service/follow-up service
Papa Chigo’s Custard will open for service daily from Monday to Friday (8am - 5pm) and
Saturday (9am - 3pm). The firm shall also follow up their clients through the establishment of
communication channel like adoption of advertisement and home service delivery.
Potential challenges in the business industry
The most significant challenges ahead include absence of quality and nutritious custard
products in the market, this shall form a backbone for us towards expanding the client base and
ultimately positioning the firm to have a presence in a larger global market.
Opportunity

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Having identified these challenges, our opportunity shall be to contribute immensely towards
the arrest of the challenge. However, we shall expand our business coast through the
contribution and production of nutritious custard thereby eradicating hunger and absence of
healthy and nutritious custard products.
Production /operational plan
Description of the location/factory
Hospital Road is a busy area where there are different classes of residents, high presence of
food vendors, fast food centres, various institutions such as Abia State Teaching Hospital. The
business will be located in a sizeable 2-room outlet for a start; the potential customers nearby
are retailers, food vendors, organizations and the general public.
Raw materials/consumables needed/supplies
Material Description/uses Key supplier/source
Corn starch This is the main ingredient
responsible for preparation of
custard
Any reliable supplier
Vanilla flavour This is adds vanilla flavour
thereby promoting the texture
and creamy nature of the
custard
Any reliable supplier
Milk flavour This adds the milky flavour
associated with custard
products
Any reliable supplier
Food colour It promotes the colour of the
custard.
Any reliable supplier
Sodium benzoate This is a preservative Any reliable supplier
PRODUCTION EQUIPMENT
Material Description/Uses Supplier
Bowl Used for mixing of the raw
materials
Any available and trusted
supplier

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Hand Glove Used to cover the hands to
avoid contaminations
Any available and trusted
supplier
Measuring spoon For measuring the required
quantity of raw materials
Any available and trusted
supplier
PRODUCTION COSTING AND CAPACITY DETAILS (On Assumption)
Raw materials Unit required Cost per unit value
Corn starch 3bags 8000 24,000
Milk flavour 3bottles 1500 4,500
Vanilla flavour 3bottles 1500 4,500
Food colour 2 sachets 500 1000
Sodium benzoate 1 bottle 300 300
Total 11,800 34,300
PRODUCTION CAPACITY
The firm initially shall strive to produce 500kg per weeks depending the demand for the
products.
Pricing strategy
The pricing strategy shall be unique putting into consideration the economic crisis facing the
world. However, the table below explains the pricing strategy:
S/N Product Description Proposed selling price
1 Big Bucket Custard
food fortified with
milk
5 – 10 kg 1,500
2 Big bucket without
milk and sugar
5-10kg 1,000

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3 Small Cup fortified
with milk and sugar
1-2 500
4 Small Cup without
milk and sugar
1-2 350
Strawberry Custard N1,200
Egg yellow custard N650
Vanilla custard N50
PRE-OPERATING ACTIVITIES AND EXPENSES PER PRODUCTION (MONTHLY)
S/NO ITEM DESCRIPTION TOTAL AMOUNT
1 Rent/Lease/Purchase of
space
This has to do with the renting
conditions of the place of
establishment
N36,000
2 Equipment/capital expense Money spent on the purchase of
different equipment for the
maximum running of the firm
N40,000
4 Business registration/permit
and license
This has to do with money sent on
registration of the business such as
CAC
N10,000
5 Advertisement This is the money spent on
creation of awareness to sensitize
the public on the existence of the
product
N4,000
6 Production Costing Money spent on buying of raw
materials such as the items stated
above
N34,300
7 Staff Salary/Development Money spent on payment of salary N40,000
Total N178,300
Marketing Strategy/Tactics
The marketing tactics that will be employed is:

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 Advertisement
 Internet: the internet will be used to display some of the commodity and their
prices on the company’s website.
 Promotion: trade shows will also be done with the baked products.
Strategic Alliance
The services and product will totally be based on direct sales and subcontracting. Therefore the
marketers will have the sole responsibility of distributing the products. The marketing-allied
bodies shall be mostly shops across Aba, Food vendors, fast food centres such as Crunchies,
Mr. Biggs, Apples etc.
ORGANIZATIONAL STRUCTURE AND MANAGEMENT/STAFFING
STAFF QUALIFICATION JOB DISCRIPTION PAYMENT
Receptionist WAEC/OND Will be responsible for
attending to people that will be
coming to the office
N10, 000
Marketing
Director
B.sc marketing In charge of the marketing
aspect of the products. He will
link up with clients to see that
the business is properly
marketed.
N20,000
Management Team
The business is a sole proprietorship business and will be single owned by Mr. Anene Sylvester
Chigozie who is a final year student of Agribusiness and Management. He also possess 2-3
years’ experience in custard production.
PROFESSIONAL SUPPORT
We will need the professional support of a home economist, and an insurance broker to help
the business grow.

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FINANCIAL ANALYSIS
Papa Chigo’s Custard will increase growth in cash and technology with increases in the year
of operation.
a) Sources of Funds
The total cost estimated to be used to fund the firm for start will be N90, 000. The principal
sources of fund are identified as the following:
1. Self
2. Debentures from family members and friends.
Analysis of how the capital will be achieved
Source Fund Stipulated period of payment
Self N50,000
Family N40,000 2years
b) Expected Expenses
The expected expense during the cause of the business for the first three years is enlisted below.
S/NO ITEM DESCRIPTION TOTAL AMOUNT
1 Rent/Lease/Purchase of
space
This has to do with the renting
conditions of the place of
establishment
N36,000
2 Equipment/capital expense Money spent on the purchase of
different equipment such as bowl,
utensils etc for the maximum
running of the firm
N44,000
4 Business registration/permit
and license
This has to do with money sent on
registration of the business such as
CAC and NAFDAC
N10,000
5 Advertisement This is the money spent on
creation of awareness to sensitize
N4,000

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the public on the existence of the
product
6 Production Costing Money spent on buying of raw
materials such as the items stated
above
N34,300
7 Staff Salary/Development Money spent on payment of salary N40,000
Total N178,300
Flow of income
S/N Product Description Proposed
selling price
Proposed
selling
price
Total
1 Big Bucket
Custard food
fortified
with milk
5 – 10 kg 1,500 150 bucks 225,000
2 Big bucket
without milk
and sugar
5-10kg 1,000 100 100,000
3 Small Cup
fortified
with milk
and sugar
1-2 500 50 25,000
4 Small Cup
without milk
and sugar
1-2 350 50 17,500
Total N367,500
Gross Profit: = Total Income – Total expenses
= N367,500 – N178,300
= N189, 200