Hospital Business Plan

Executive Summary
Health care services and new hospitals are one of the fastest expanding industries
in the world. Its growth depends upon the needs of society. The wealth and
development of a nation are dependent upon its health. Healthcare service
providers or organizations are a very serious concern in every part of the world. In
fact, healthcare industry consumes a vast amount of a country’s budget because
providing best health care services to people is the most important task. Every
government ensures that its citizens get the best healthcare services possible.
It is safe to say that the demand for medical and diagnostic treatment service in
Nigeria far outstrips the supply, meaning that a reasonable percentage of the
total requirement has remained unsatisfied. These then means that any one going
into establishing a hospital can still operate profitably.
The project requires about N30, 000,000 in which the applicant (promoter)
intends to contribute N3, 000,000 to the project as equity which represent 10% of
the project and intends to secure an Investment of N27, 000,000 from an investor
which will represent 90% of the project worth.
The cash flow projection shows positive net cash balance at the end of each circle from
year 1 to final. A projected profit and loss account shows indication of profitability at the
end of each year of the project with Net profit N187, 439, N2, 952,881 and N6, 579,271
from year 1 to final. The return on Sales, Capital employed and Equity are detailed below
YEAR 1 YEAR 2 YEAR 3
NET PROFIT 187,439 2,952,881 6,579,271
RETURN ON SALES 1% 8% 16%
RETURN ON CAPITAL EMPLOYED 0% 5% 11%
RETURN ON EQUITY 3% 45% 101%
Hammersmith Hospital Page 5
The Investment is expected to be paid back in 3 years. The cash flow shows a
positive return with Net Present Value (NPV) of N174,683,934 Benefit Cost Ratio
of 3.16 and an Internet Rate of Return (IRR) greater than 50%. All factors indicate
positive viability of project which is worth the bank investing into.

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