FINACAL PROJECTIONS

FINANCES

(Personal Income Statement removed for privacy.)

Start Up Costs

Equipment	$46,000
Materials	$4,500
Rent (2 Months)	$2,100
Site Modification	$5,000
Signage, Stationary, etc.	$1,000
Consultation	$1,000
Supplies	$600
Cash Reserves	$9,800
Total Start Up Costs	$70,000

The compnay is in the process of securing financing for startup. The proprietor currently has $20,000 from private sources and is seeking $50,000 in additional bank loans.

OPERATING COSTS

Payroll

Two part time employees will be hired to start working on opening day. They will be retained until Labor Day weekend unless strong sales show a further need for them. In the fall, winter and spring, the proprietor and his wife will be the only staff required. Employees will be paid $5.50 per hour, and will work a combined total of 30 hours per week. Wage expenditures will be $707.00 a month with additional payroll taxes running $71.00, for a total expenditure of$778.00.

Rent

The Green Lake storefront currently under consideration rents for $1050 a month.

Utilities

Heat and Electric bills for Jordan Galleria, a downtown storefront of approximately the same dimensions required by Breadcrafter, pays $225.00 at the height of the winter heat season. Taking into account walk in and reach in cooler use, a figure of $350.00 is a reasonable estimated monthly average.

The bread oven will be run four hours per day on busy bake days. Conversations with other bakery owners have indicated that a 4 deck oven consumes $4 of gas per hour, for a total of $343.00 per month at maximum capacity.

A total figure of $725.00 per month is a reasonable estimated monthly average.

Advertising

Breadcrafter will run an advertisement in the Port Hanover News Review during opening week. Another advertisement will run Labor Day weekend. Total advertisement expenditures will run $200 per month. The News Review is known to do spotlight stories on new Port Hanover businesses and Breadcrafter will take advantage of this publicity.

Advertising expenditures will be kept to a minimum in the fall, winter and spring. The company will rely on community service functions, liberal sampling, and word of mouth to reach new customers.

Repair and Maintenance

The estimated maintenance cost for the first month is $500.00. From there it gradually diminishes to $200 a month for the remainder of the year. After the first of the year maintenance estimates are reduced to $100 a month.

Insurance

A Business Owner's Policy, covering contents, liability, and some loss of income, will cost $400 $500 a year for Breadcrafter, as quoted by Sam Williams of Port Hanover Insurance. Worker's Comp will run $2.25 for every $100 paid. Breadcrafter has budgeted $50 a month in general insurance and $20 a month in Worker's Comp. Health Insurance premiums for the proprietor and his family will run $250 per month.

Taxes and Licenses

The company has budgeted $150 a month on miscellaneous taxes and licenses.

General Supplies

General supplies will consist mainly of bread bags which cost $.05 each for paper and $.03 each for plastic. Bag material, which affects the quality of the crust in storage, will be chosen by the customer. These prices have been included in the cost of sale of each loaf. Cleaning and maintenance supplies will total no more than $50 per month. Breadcrafter has budgeted $125 per month as a conservative figure.

Professional Fees

Professional fees after startup will be kept to a minimum. The proprietor will perform all the necessary filing and bookkeeping chores required except year end tax filing and calculation of depreciation. The company has budgeted $325 in January and

$325 in March to cover these needs.

Miscellaneous

Breadcrafter has budgeted $120 per month to cover miscellaneous expenses.

Proposed Baking Materials Requirements

PLAN OF OPERATION

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DESCRIPTION OF MANAGEMENT TEAM

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COMPETITOR ANALYSIS

Grainery Food Co-op

Breadcrafter's primary competitor. The Grainery currently has a customer base that regularly buys whole grain breads. These customers are interested in healthy foods, and they will appreciate the attractive nutritional profile of our products. Due to undercapitalization, the Grainery will have trouble responding to the quality advantage our equipment and methods provides. Many potential customers are reluctant to patronize the Grainery, perceiving its patrons and employees as "too liberal". True or not, these customers may feel more comfortable at Breadcrafter. Renee Richards, the proprietor's wife, was formerly a Grainery bread baker. She knows their business well.

Helmut's Pastry Shop

An established bakery specializing in pastries and doughnuts. They have a capable facility. Due to heavy investment in pastry equipment and relatively small bread sales, they are unlikely to react strongly to our presence.

Twin's Bakery

Very similar to Helmut's.

The Coffee Mug

Specializing in donuts, pastries, and country clutter handicrafts. They sell some lower quality breads. Major risk is their location, right next door to Breadcrafter's prospective site. This risk could also be an asset, bringing bakery customers in search of better bread to Breadcrafter.

Fred's Markets

Large supermarket with in store bakery. Fred's offers nonscratch, relatively low quality breads and pastries at very low prices. Their largest advantage, other than price, is the convenience of one stop shopping. There is some possibility of future wholesale distribution of our products.

Daley's Supermarkets

Very similar to Fred's

Taylor's

Similar to Fred's and Daley's, but smaller. Higher possibility of future wholesale distribution.

Toothsome Foods Company

Downtown specialty foods retailer. Current employer of Breadcrafter's proprietor. TFC has a small, undercapitalized bread program Due to the absence of the baker, they are unlikely to compete. Proprietor will offer to buy some of the bakery equipment. Future wholesale distribution of contract products is a strong possibility.

Breadcrafter's production capacity will be an advantage over the specialty stores. Product specialization will be an advantage over the pastry shops and supermarkets. Breadcrafter's product quality will be an advantage over all local competitors.

http://www.referenceforbusiness.com/business-plans/Business-Plans-Volume-05/Bread-Bakery-Business-Plan.html#ixzz3YPPAmk9a

MARKETING STRATEGY

In rapidly developing Malaysia, the demand for better quality biscuits is on the rise. Julie’s Peanut Butter Sandwich and Love Letters (wafer rolls) are well received by Malaysians as well as overseas consumers. Julie’s has become a household name in the relatively short period. Since 2005, Julie’s biscuits have been exported to more than 50 countries, including Asean, the Middle East, Japan, Taiwan, China, Mongolia, Bhutan, Nepal, Bangladesh, India, France, Spain, Portugal, Pacific islands, Indian Ocean islands, South Korea, Africa, the US, Canada, New Zealand and Australia. In Malaysia, Julie’s biscuits are widely distributed through all major hypermarkets, supermarkets, mini markets and other retail outlets.

   With the goal of becoming a renowned international brand, Julie’s maintains a strong commitment to producing better quality biscuits, catering primarily to the middle and upper class consumers. With this focused commitment, Julie’s aims to be a regional leader in quality biscuits.

http://www.julies.com.my/JuliescorporateInfo4.php

BUSINESS AND INDUSTRY ANALYSIS

PETALING JAYA: The name Perfect Food Manufacturing (M) Sdn Bhd may not ring a bell to many as opposed to its brand name, Julie's, but this may not be the case for long, if the biscuit manufacturer has its way.

Despite having gained some measure of success, Perfect Food is still hungry for growth and has set its sights on becoming a global brand.

Group general manager (sales and marketing) Martin Ang said the group would “continue to expand” on new products as well as export markets, including Latin America. “We want to project the Malaysian brand in the eyes of the world and that Malaysia can indeed produce world-class products,” Ang said at a recent luncheon business talk entitled Journey to Success: The Stories of Julie's.

Julie's is synonymous with peanut butter sandwich and cheese sandwich biscuits. At present, Julie's is enjoyed in more than 50 countries, including China, Singapore, Indonesia, Taiwan, Australia, the United Kingdom and Hong Kong.

Last year, the confectioner registered RM200mil in sales and is targeting some 10% growth this year, with the introduction of new products.

“Currently, some 70% of our sales is derived from the local market, with the balance coming from exports. This year, we hope to do 60:40, with 40% coming from oversea0s. This number could be the reverse in five years,” he said, adding that China was one of its largest export markets, while Singapore and Taiwan were equally important.

He noted that Julie's was quite dominant in the Asean region.

Perfect Food was established in 1981 in Alor Gajah, Malacca. Two brothers, Sai Ah Sai and Sai Chin Hock, founded the business after buying it from a previous owner.

Today, it operates from three factories two in Alor Gajah and another in Masjid Tanah employing some 1,000 employees and 17 lines, making it one of the largest biscuit manufacturers in the country.

“While we definitely have expansion on our minds, this won't be in terms of adding more factories. As our current factory production capacity is at 70%, we plan to add more machines and production lines to our factories to further facilitate the rising demand for our products both locally and internationally,” said Ang.

Ang pointed out that it has not been smooth sailing, however. In 2008, the biscuit maker had to battle its biggest nightmare to date at the height of the melamine contamination crisis.

It was found that its products contained melamine-tainted ammonium bicarbonate. The group suffered some RM14mil losses on recalled biscuits and its products were banned in several countries.

“We thought we would go bust then. Our production lines stopped for a month, and we had to recall biscuits to be destroyed.

“We were also banned in several countries and everything had to be withdrawn.

“We were banned from exporting to Singapore for 1 months, Taiwan for 1 years and several months in Hong Kong,” Ang recalls, adding that the consumer confidence level fell to an all-time low.

Julie's is ranked No.3 in the local market. To this, Ang said: “We are not looking at the position. We want to look at the world market.”

http://www.thestar.com.my/Business/Business-News/2013/04/15/Perfect-Food-aims-to-be-global-brand/?style=biz

BUSINESS MODEL