Bakery Business Plan Jollys Java And Bakery Commerce Essay

September 13, 2017 Commerce

Jolly ‘s Java and Bakery ( JJB ) is a start-up java and bakeshop retail constitution located in southwest Washington. JJB expects to catch the involvement of a regular loyal client base with its wide assortment of java and pastry merchandises. The company plans to construct a strong market place in the town, due to the spouses ‘ industry experience and mild competitory clime in the country.

JJB purposes to offer its merchandises at a competitory monetary value to run into the demand of the middle-to higher-income local market country occupants and tourers.

The Company

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JJB is incorporated in the province of Washington. It is every bit owned and managed by its two spouses.

Mr. Austin Patterson has extended experience in gross revenues, selling, and direction, and was frailty president of selling with both Jansonne & A ; Jansonne and Burper Foods. Mr. David Fields brings experience in the country of finance and disposal, including a stretch as main fiscal officer with both Flaxfield Roasters and the national java shop concatenation, BuzzCups.

The company intends to engage two full-time pastry bakers and six parttime baristas to manage client service and twenty-four hours to twenty-four hours operations.

Merchandises and Servicess

JJB offers a wide scope of java and espresso merchandises, all from high quality Columbian grown imported java beans. JJB caters to all of its clients by supplying each client java and espresso merchandises made to accommodate the client, down to the smallest item.

The bakeshop provides newly prepared bakeshop and pastry merchandises at all times during concern operations. Six to eight moderate batches of bakeshop and pastry merchandises are prepared during the twenty-four hours to guarantee fresh baked goods are ever available.

The Market

The retail java industry in the U.S. has late experienced rapid growing. The cool Marine clime in southwest Washington stimulates ingestion of hot drinks throughout the twelvemonth.

JJB wants to set up a big regular client base, and will therefore concentrate its concern and selling on local occupants, which will be the dominant mark market. This will set up a healthy, consistent gross base to guarantee stableness of the concern. In add-on, tourer traffic is expected to consist about 35 % of the grosss. High visibleness and competitory merchandises and service are critical to capture this section of the market.

Fiscal Considerations

JJB expects to raise $ 110,000 of its ain capital, and to borrow $ 100,000 guaranteed by the SBA as a ten-year loan. This provides the majority of the current funding required.

JJB anticipates gross revenues of approximately $ 491,000 in the first twelvemonth, $ 567,000 in the 2nd twelvemonth, and $ 655,000 in the 3rd twelvemonth of the program. JJB should interrupt even by the 4th month of its operation as it steadily increases its gross revenues. Net incomes for this clip period are expected to be about $ 13,000 in twelvemonth 1, $ 36,000 by twelvemonth 2, and $ 46,000 by twelvemonth 3. The company does non expect any hard currency flow jobs.

Company Summary

JJB is a bakeshop and java shopA managed by two spouses. These spouses represent sales/management and finance/administrationA countries, severally. The spouses will supply support from their ain nest eggs, which will cover start-up disbursals and supply a fiscal shock absorber for the first months of operation. A ten-year Small Business Administration ( SBA ) A loan will cover the remainder of the needed funding. The company plans to construct a strong market place in the town, due to the spouses ‘ industry experience and mild competitory clime in the country.

2.1 Company Ownership

JJB is incorporated in the province of Washington. It is every bit owned by its two spouses.

2.2 Company History

JJB is a start-up company. Financing will come from the spouses ‘ capital and a ten-year SBA loan. The undermentioned chart and table illustrate the company ‘s jutting initial start-up costs.

Merchandises

JJB offers a wide scope of java and espresso merchandises, all from high quality Columbian grown imported java beans. JJB caters to all of its clients by supplying each client java and espresso merchandises made to accommodate the client, down to the smallest item.

The bakeshop provides newly prepared bakeshop and pastry merchandises at all times during concern operations. Six to eight moderate batches of bakeshop and pastry merchandises are prepared during the twenty-four hours to guarantee fresh baked goods are ever available.

Market Analysis Summary

JJB ‘s focal point is on run intoing the demand of a regular local occupant client base, every bit good as a important degree of tourer traffic from nearby main roads.

4.1 Market Segmentation

JJB focuses on the middle- and upper-income markets.A These marketA segmentsA devour the bulk of java and espresso merchandises.

Local Residents

JJB wants to set up a big regularA client base. This will set up a healthy, consistent gross base to guarantee stableness of the concern.

Tourists

Tourist traffic comprises about 35 % of the revenues.A High visibleness and competitory merchandises and service are critical to capture this section of the market.

4.1.1 Market Analysis

The chart and table below outline the entire market potency of the above described client segments.A

4.2 Target Market Segment Strategy

The dominant mark market for JJB is a regular watercourse of local occupants. Personal and expedient client service at a competitory monetary value is cardinal to keeping the local market portion of this mark market.

4.2.1 Market Needs

Because Washington has a cool clime for eight months out of the twelvemonth, hot java merchandises are really much in demand.A During the staying warmer four months of the twelvemonth, iced java merchandises are in significantly high demand, along with a slower but consistent demand for hot java merchandises. Much of the twenty-four hours ‘s activity occurs in the forenoon hours before 10 a.m. , with a comparatively steady flow for the balance of the twenty-four hours.

4.3 Service Business Analysis

The retail java industry in the U.S. has late experienced rapid growing. The cool Marine clime in southwest Washington stimulates ingestion of hot drinks throughout the twelvemonth. Coffee drinkersA in the Pacific Northwest are finical about the quality of drinks offered at the legion java bars across the part. Despite low competition in the immediate country, JJB will place itself as a topographic point where clients can bask a cup of delightful java with a fresh pastry in a relaxing environment.

4.3.1 Competition and Buying Patterns

Competition in the local country is slightly thin and does non supply about the degree of merchandise quality and client service as JJB.A Local clients are looking for a high quality merchandise in a loosen uping atmosphere.A They desire a unique, posh experience.

LeadingA competitorsA purchase and joint high quality, whole-bean javas and, along with Italian-style espresso drinks, cold-blended drinks, a assortment of pastries and sweets, coffee-related accoutrements and equipment, and a line of premium teas, sell these points chiefly through company-operated retail shops. In add-on to gross revenues through company-operated retail shops, taking rivals sell java and tea merchandises through other channels of distribution ( forte operations ) .

Larger chainsA vary theirA merchandise mix depending upon the size of each shop andA its location. Larger shops carry a wide choice ofA whole bean javas in assorted sizes and types of packaging, every bit good as an mixture of coffee- and espresso-making equipment and accoutrements such as java bombers, java shapers, espresso machines, java filters, storage containers, travel tumblers and mugs. SmallerA shops and booths typically sell a full line of java drinks, a more limited choice of whole-bean javas, and a few accoutrements such as travel tumblers and logo mugs.A During financial twelvemonth 2000, industryA retail gross revenues mix by merchandise type was about 73 % A drinks, 14 % nutrient points, eightA per centum whole-bean javas, and five per centum coffee-making equipment and accoutrements.

Technologically savvy competitorsA make freshA java and coffee-related merchandises handily available via mail order and online. Additionally, A mail order catalogsA offeringA javas, certain nutrient points, and choice coffee-making equipment and accoutrements, have been made available by a few larger competitors.A Websites offering on-line storesA that allow clients to shop for and purchase java, gifts, and other points via the Internet have become more commonplace every bit good.

Scheme and Implementation Summary

JJB will win by offering consumersA high quality java, espresso, and bakeshop merchandises with personal service at a competitory monetary value.

5.1 Competitive Edge

JJB ‘s competitory border is the relativelyA low degree of competition in the local country in this peculiar niche.

5.2 Gross saless Scheme

As the chart and table show, JJBA anticipates gross revenues of approximately $ 491,000A in the first twelvemonth, $ 567,000 in the 2nd twelvemonth, and $ 655,000 in theA 3rd twelvemonth of the program.

Gross saless Forecast

2001

2002

2003

Unit of measurement Gross saless

Espresso Drinks

135,000

148,500

163,350

Pastry Items

86,000

94,600

104,060

Other

0

0

0

Entire Unit Gross saless

221,000

243,100

267,410

Unit of measurement Monetary values

2001

2002

2003

Espresso Drinks

$ 3.00

$ 3.15

$ 3.31

Pastry Items

$ 1.00

$ 1.05

$ 1.10

Other

$ 0.00

$ 0.00

$ 0.00

Gross saless

Espresso Drinks

$ 405,000

$ 467,775

$ 540,280

Pastry Items

$ 86,000

$ 99,330

$ 114,726

Other

$ 0

$ 0

$ 0

Entire Gross saless

$ 491,000

$ 567,105

$ 655,006

Direct Unit of measurement Costss

2001

2002

2003

Espresso Drinks

$ 0.25

$ 0.26

$ 0.28

Pastry Items

$ 0.50

$ 0.53

$ 0.55

Other

$ 0.00

$ 0.00

$ 0.00

Direct Cost of Gross saless

Espresso Drinks

$ 33,750

$ 38,981

$ 45,023

Pastry Items

$ 43,000

$ 49,665

$ 57,363

Other

$ 0

$ 0

$ 0

Subtotal Direct Cost of Gross saless

$ 76,750

$ 88,646

$ 102,386

Management Summary

Austin Patterson has extensiveA experience in gross revenues, selling, and direction, and was frailty presidentA of selling with both Jansonne & A ; Jansonne and Burper Foods.A DavidA Fields brings experience in the country of finance and disposal, includingA a stretch as main fiscal officerA with both Flaxfield RoastersA and the national java shop concatenation, BuzzCups.

6.1 Forces Plan

As the forces program shows, A JJB expects to do important investings in gross revenues, gross revenues support, and merchandise development forces.

Forces Plan

2001

2002

2003

Directors

$ 100,000

$ 105,000

$ 110,250

Pastry Bakers

$ 40,800

$ 42,840

$ 44,982

Baristas

$ 120,000

$ 126,000

$ 132,300

Other

$ 0

$ 0

$ 0

Entire Peoples

10

10

10

Entire Payroll

$ 260,800

$ 273,840

$ 287,532

Fiscal Plan

JJB expects to raise $ 110,000A of its ain capital, and to borrow $ 100,000 guaranteed byA the SBA as a ten-year loan.A This provides the majority of the current funding required.

7.1 Break-even Analysis

JJB ‘s Break-even Analysis is based on the norm of the first-yearA figures for entire gross revenues by units, and by operating disbursals. These are presented as per-unit gross, per-unit cost, and fixed costs.A These conservative premises make for a more accurate estimation of existent hazard. JJB should interrupt even by theA 4th month of its operation as it steadilyA increases its gross revenues.

Break-even Analysis

Monthly Unit of measurements Break-even

17,255

Monthly Revenue Break-even

$ 38,336

Premises:

Average Per-Unit Gross

$ 2.22

Average Per-Unit Variable Cost

$ 0.35

Estimated Monthly Fixed Cost

$ 32,343

7.2 Jutting Net income and Loss

As the Net income and Loss tabular array shows, A JJB expects to go on itsA steady growing inA profitableness over the following three old ages of operations.

Pro Forma Profit and Loss

2001

2002

2003

Gross saless

$ 491,000

$ 567,105

$ 655,006

Direct Cost of Gross saless

$ 76,750

$ 88,646

$ 102,386

Other

$ 0

$ 0

$ 0

Entire Cost of Gross saless

$ 76,750

$ 88,646

$ 102,386

Gross Margin

$ 414,250

$ 478,459

$ 552,620

Gross Margin %

84.37 %

84.37 %

84.37 %

Expenses

Payroll

$ 260,800

$ 273,840

$ 287,532

Gross saless and Marketing and Other Expenses

$ 27,000

$ 35,200

$ 71,460

Depreciation

$ 60,000

$ 69,000

$ 79,350

Utilities

$ 1,200

$ 1,260

$ 1,323

Payroll Taxs

$ 39,120

$ 41,076

$ 43,130

Other

$ 0

$ 0

$ 0

Entire Operating Expenses

$ 388,120

$ 420,376

$ 482,795

Net income Before Interest and Taxes

$ 26,130

$ 58,083

$ 69,825

Earnings before interest taxes depreciation and amortization

$ 86,130

$ 127,083

$ 149,175

Interest Expense

$ 10,000

$ 9,500

$ 8,250

Taxs Incurred

$ 3,111

$ 12,146

$ 15,650

Net Net income

$ 13,019

$ 36,437

$ 45,925

Net Profit/Sales

2.65 %

6.43 %

7.01 %

7.3 Jutting Cash Flow

The hard currency flow projection shows thatA commissariats for ongoing disbursals are equal to run into JJB ‘s demands as the businessA generatesA hard currency flow sufficient to back up operations.

Pro Forma Cash Flow

2001

2002

2003

Cash Received

Cash from Operationss

Cash Gross saless

$ 491,000

$ 567,105

$ 655,006

Subtotal Cash from Operations

$ 491,000

$ 567,105

$ 655,006

Extra Cash Received

Gross saless Tax, VAT, HST/GST Received

$ 0

$ 0

$ 0

New Current Borrowing

$ 0

$ 0

$ 0

New Other Liabilities ( interest-free )

$ 0

$ 0

$ 0

New Long-term Liabilitiess

$ 0

$ 0

$ 0

Gross saless of Other Current Assetss

$ 0

$ 0

$ 0

Gross saless of Long-term Assetss

$ 0

$ 0

$ 0

New Investment Received

$ 0

$ 0

$ 0

Subtotal Cash Received

$ 491,000

$ 567,105

$ 655,006

Outgos

2001

2002

2003

Outgos from Operationss

Cash Spending

$ 260,800

$ 273,840

$ 287,532

Bill Payments

$ 143,607

$ 186,964

$ 237,731

Subtotal Spent on Operationss

$ 404,407

$ 460,804

$ 525,263

Extra Cash Spent

Gross saless Tax, VAT, HST/GST Paid Out

$ 0

$ 0

$ 0

Chief Repayment of Current Borrowing

$ 0

$ 0

$ 0

Other Liabilitiess Principal Repayment

$ 0

$ 0

$ 0

Long-run Liabilitiess Principal Repayment

$ 0

$ 10,000

$ 15,000

Purchase Other Current Assetss

$ 0

$ 0

$ 0

Purchase Long-term Assetss

$ 0

$ 20,000

$ 20,000

Dividends

$ 0

$ 0

$ 0

Subtotal Cash Spent

$ 404,407

$ 490,804

$ 560,263

Net Cash Flow

$ 86,593

$ 76,301

$ 94,744

Cash Balance

$ 156,593

$ 232,894

$ 327,637

7.4 Balance Sheet

The followers is a jutting Balance Sheet for JJB.

Pro Forma Balance Sheet

2001

2002

2003

Assetss

Current Assetss

Cash

$ 156,593

$ 232,894

$ 327,637

Other Current Assetss

$ 12,000

$ 12,000

$ 12,000

Entire Current Assets

$ 168,593

$ 244,894

$ 339,637

Long-run Assetss

Long-run Assetss

$ 65,000

$ 85,000

$ 105,000

Accumulated Depreciation

$ 60,000

$ 129,000

$ 208,350

Entire Long-term Assetss

$ 5,000

( $ 44,000 )

( $ 103,350 )

Entire Assetss

$ 173,593

$ 200,894

$ 236,287

Liabilitiess and Capital

2001

2002

2003

Current Liabilitiess

Histories Collectible

$ 14,574

$ 15,438

$ 19,907

Current Borrowing

$ 0

$ 0

$ 0

Other Current Liabilitiess

$ 0

$ 0

$ 0

Subtotal Current Liabilitiess

$ 14,574

$ 15,438

$ 19,907

Long-run Liabilitiess

$ 100,000

$ 90,000

$ 75,000

Entire Liabilitiess

$ 114,574

$ 105,438

$ 94,907

Paid-in Capital

$ 110,000

$ 110,000

$ 110,000

Retained Net incomes

( $ 64,000 )

( $ 50,981 )

( $ 14,544 )

Net incomes

$ 13,019

$ 36,437

$ 45,925

Entire Capital

$ 59,019

$ 95,456

$ 141,381

Entire Liabilitiess and Capital

$ 173,593

$ 200,894

$ 236,287

Net Worth

$ 59,019

$ 95,456

$ 141,381

7.5 Business Ratios

The following table represents cardinal ratios for the retail bakeshop and java store industry. These ratios are determined by the Standard Industry Classification ( SIC ) Index codification 5812, Eating Topographic points.

Ratio Analysis

2001

2002

2003

Industry Profile

Gross saless Growth

0.00 %

15.50 %

15.50 %

7.60 %

Percentage of Total Assets

Other Current Assetss

6.91 %

5.97 %

5.08 %

35.60 %

Entire Current Assets

97.12 %

121.90 %

143.74 %

43.70 %

Long-run Assetss

2.88 %

-21.90 %

-43.74 %

56.30 %

Entire Assetss

100.00 %

100.00 %

100.00 %

100.00 %

Current Liabilitiess

8.40 %

7.68 %

8.42 %

32.70 %

Long-run Liabilitiess

57.61 %

44.80 %

31.74 %

28.50 %

Entire Liabilitiess

66.00 %

52.48 %

40.17 %

61.20 %

Net Worth

34.00 %

47.52 %

59.83 %

38.80 %

Percentage of Gross saless

Gross saless

100.00 %

100.00 %

100.00 %

100.00 %

Gross Margin

84.37 %

84.37 %

84.37 %

60.50 %

Selling, General & A ; Administrative Expenses

74.74 %

71.43 %

71.39 %

39.80 %

Ad Expenses

0.49 %

1.76 %

6.87 %

3.20 %

Net income Before Interest and Taxes

5.32 %

10.24 %

10.66 %

0.70 %

Main Ratios

Current

11.57

15.86

17.06

0.98

Quick

11.57

15.86

17.06

0.65

Entire Debt to Total Assetss

66.00 %

52.48 %

40.17 %

61.20 %

Pre-tax Return on Net Worth

27.33 %

50.90 %

43.55 %

1.70 %

Pre-tax Return on Assetss

9.29 %

24.18 %

26.06 %

4.30 %

Extra Ratios

2001

2002

2003

Net Net income Margin

2.65 %

6.43 %

7.01 %

n.a

Tax return on Equity

22.06 %

38.17 %

32.48 %

n.a

Activity Ratios

Histories Collectible Employee turnover

10.79

12.17

12.17

n.a

Payment Dayss

27

29

27

n.a

Entire Asset Employee turnover

2.83

2.82

2.77

n.a

Debt Ratios

Debt to Net Worth

1.94

1.10

0.67

n.a

Current Liab. to Liab.

0.13

0.15

0.21

n.a

Liquidity Ratios

Net Working Capital

$ 154,019

$ 229,456

$ 319,731

n.a

Interest Coverage

2.61

6.11

8.46

n.a

Extra Ratios

Assetss to Gross saless

0.35

0.35

0.36

n.a

Current Debt/Total Assetss

8 %

8 %

8 %

n.a

Acid Test

11.57

15.86

17.06

n.a

Sales/Net Worth

8.32

5.94

4.63

n.a

Dividend Payout

0.00

0.00

0.00

n.a

x

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