PRODUCTION AND OPERATION PLAN.

This section offers information on how a product will be produced or how a service will be provided.

  • Production facilities and capacity.
  • Give the types of facilities required.
  • List all the equipments, machineries and show the cost of each.
  • List any other facility required to set up the business and show the cost.
  • Elaborate more on plans for repairs and maintenance of machinery.
  • Come up with the factory/office layout.
  • Come up with the levels of production i.e. minimum and maximum.
  • Elaborate more on expansion and future plans of office or factory.

Table 5 Production, Facilities and Capacity.

Office 2 rooms 40,000 5 units
Store 2 rooms 20,000 1 ton of
Pick up 1 200,000 Cc
Electricity 3 phase 30,000 1000 Kw
pangas 5 2,000 5  individuals
  • Firm Layout
  • Draw the firm layout.
    • Production strategy.
  • The means and methods used to produce the products are given.
  • Describe the production development from idea to saleable product/service.
  • Indicate the costs that you will incur when developing your new products
  • Highlight the methods to use e.g. JIT
  • Take into account the changes you anticipate in technology and how you will address them.
  • Are there any alternative sources available?
  • Describe the skills required for efficient production for direct and indirect workers
  • Describe the monthly production cost for products and services.
  • Compute the total production cost in a month
  • Elaborate more on purchasing and stock control methods to use e.g. EOQ,JIT
    • Production process.
  • Give the stages in producing products and offering services.
  • Give the production materials used in production process
  • Give the external factors that are likely to affect the production process.
  • How will you minimize the effects of external factors?
  • Indicate the factors that affect the production process.


  • Elements affecting production operations.
    • Health regulations
  • Ensure that all public health guidelines are adhered to in handling all company’s products.
  • Regular advice sought from government departments.
  • Give the necessary measures that you would take or will be followed to guard against physical injuries of workers e.g. use of mask,boots,jackets and helmets
    • Environmental regulations.
  • Environmental concerns are one of the emerging issues in running of any business.
  • Adhere to the legislations set by the government.
  • Regular audits should be undertaken to check their availability and efficiency
  • Are there measures to conserve the environment? For instance, what environmental concerns will be undertaken e.g. planting trees.
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