Financing the Business Operation - Example

Company/Project name; The Coffee Shop Company address; 5534-8705 Company phone; +16798965-030 Fax, +1(865)346-3654 Email; coffeeshop@uk.Org Contents Contents 2 Executive Summary 3 Company/Project Summary 4 Statement of purpose 4 Motivation behind business plan 4 Business goals 4 Start-up Summary 5 Services 5 Market Analysis Summary 6 Target Customer 6 Estimated Market Share and Sales 6 Formulae for Market Share 7 Market Share for Coffee Shop 7 Strategy and Implementation Summary 8 Promotion & Advertising 8 Sales Tactics 8 Service/Warranty 9 Product Distribution 9 Sales Budget 9 Management Summary 10 Chef executive director 10 Chief accountant 10 Senior marketing management 10 Overview the organization structure 10 Financial Plan 12 Start-up Funding 12 Projected Profit and Loss 13 References 14 Executive Summary This business plan is prepared for the coffee shop to significantly source finance needed to finance the business operation. The coffee shop is a start up business situated in Germany in the town of Preston. This reason for the locality is a result of the high popualtion of youth who moistly consume lots of coffee. The coffee shop anticipates attracting interest of constant loyal clients with its assortment of coffee and tartlet product whilst providing cool and modest environments. The company plans to create a strong market position in the society by selecting the correct location as well as providing the latest age, organic, fair trade as well as hang out. The aim of the coffee shop is to offer competitive prices to comply with the demand of the every income class in the market in Preston. The coffee shop might create a constant large customer base and will as result focus on its business as well as marketing on local resident, which in turn would be the leading target market. This will create a good, steady income to guarantee stability of the business. Presence of superior competitive and visibility products and service is important in capturing the market division. Competition in Preston is not harsh and provides good space. Local clients are looking for superior product in terms of quality and service provision. They want an inclusive experience that entails the entire family. The current competition does not depict what the coffee shops must offer to the customers. The coffee shop requires $487,800 to buy the equipment and to market their products and service to the customers in Preston. The following plan explains the company. the market, and the business plan to expand its operations with the aid of the needed capitals. Company/Project Summary The business is located in Preston is intended to cater for every of its clients by ensuring that the demand of quality coffee is met and the product is in compliance with the customer’s state and preferences at all time. The business will focus on sourcing its products from the local suppliers like the cupcakes by US that has been in operations for almost a year now and is expanding, making the bakery a superior alternative for the coffee shops (Abrams, 2003). The cafeteria will as well provide its customers the options of sitting with their laptops, newspapers or magazines while al will be available for customers without any fees to ensure that the customer services is improved and that they get a cool and welcoming environment they their take the coffee. Statement of purpose To give an inviting, agreeable climate where the client can get quality sustenance, administration and stimulation at a sensible cost. Motivation behind business plan This archive is proposed to plot the start-up of the business known as coffee circus. The strategy for success has a two-crease mission. One is to get financing and the other is to help characterize the who, what, where, when and how for the business so that the business will have an obvious arrangement and operations outline. Business goals The objectives of the business are to give a generous wage and to make a business and workplace where both the client and worker are treated with nobility and regard. The particular objectives of the business are: Benefit – Personal income of more than $500, 0000 every year for the three years Customers - make a base demographic of people who live and work in the territory. These people will like a casual air where they can "hang out" Representatives - Competent workers (no less than 50% from low-pay neighborhoods) who are submitted and faithful Start-up Summary Start-up Expenses Furniture $ 15,500.00 Tables $ 10,800.00 Ovens $ 35,000.00 Gas cookers $ 28,500.00 Cutleries $ 12,500.00 Research and Development $ 8,500.00 Marketing $ 6,500.00 Total Start-up Expenses $ 117,300.00 Start-up Assets Cash Assets $ 250,000.00 Other Current Assets $ 35,500.00 Long-term Assets $ 85,000.00 Total Assets $ 370,500.00 Total Requirements $ 487,800.00 Services The coffee house will provide an assortment of alternates to it clients. Coffee and tea of every kind will be available. The alternatives of coffee will vary from espresso to latte, from regular to flavor to raspberry mocha. The tea will vary from English to flavored assortment. The juice and soda will as well exit. For the client who wants take alcoholic drinks like beer and wine, it shall be available for sell as well (Abrams, 2003). Wine might be on order basis while beer will be existing. The breakfast menu will comprise of Muffin, bagel, doughnut, croissant, French pastry and many more. Other than the crepe, the baked goods will be bought from the works. Lunch and dinner will comprise of the sandwich, salad and eight soups that are more diverse. Market Analysis Summary Target Customer The customer will range from the age of 17 to 60 years. The income level ranges from $15000 to $150,000 per annum. The customers will live within three miles of coffee business in Preston. The customers will comprise of white-collar jobs with dispensable income. The level of education of the customers ranges from college to post graduate level. A small portion (9%) will comprise of other areas of education. This will mainly be individuals who are tourist. Mainly, the customers will be individuals who are having fun in relaxing environment. Estimated Market Share and Sales On the basis of client profile for coffee shop, the following number was accumulated. The report was prepared based on the coffee shop as the main point. The aim of establishing the market share for coffee. The national statistics depict that many individual do not travel unlike the 3 miles to eat or listing to entertainment. The repot depicts that 162,900 individual live in the 3 miles radius within Preston (Greener, 2009). The following is the breakdown of the target clients. Age Percent % of Population 21-24 6.3% 25-29 8.0% 30-34 8.2% 35-39 8.0% Total 47.1% Income % of Population 50,000-74,999 20.9% 35,000-49,999 20.0% 25,000-34,999 14.9% Total 55.9% Education % of Population Some college 28.76% Associate degree 9.1% Bachelor degree 13.4% Graduate degree 5.5% Total 56.8% Occupation % of Population Executive 13.0% Prof/Specialty 13.2% Technical Support 4.7% Administrative Support 20.1% Total 50.9% Formulae for Market Share The formulae consider the net population and afterwards multiplying the number by percentage in order of significance to the target customers as depicted below. Total Market= {Total Population × Age% × Income% × Education% × Occupation %} Total Market ={162,900×47%×56%×57%×51%} = 12464 persons Market Share for Coffee Shop 2.19% of Market= {276 Customer/Day or 17 Customer. /Hour 1.79% of Market=231 Customer. /Day or 14 Customer Hour 1596% of Market=203 Customer. /Day or 12 Customer Hour Strategy and Implementation Summary Promotion & Advertising The marketing will make on many platforms. Will issue TV as the main media channel followed by flayers, which will be supplied in the neighborhood. Ads will be taken out in the bulletins in Preston town. The ads will offer 15% off, if the market covers wide area in distributing bulleting. The coffee shop is situated in a strategic place in Preston with its neighbors being the church and schools. Many people attend church in this region, the school is packed with student, and thus, we believe that our coffee shop is strategically located fir business purpose. With regards to entertainment night, radio and newspapers ad will be placed (Hiduke, 2013). The entertainment and food critic will be provided an enticement. For business in Preston, menu will be provided and order will exist by fax and phone calls. The clients maintaining list will as well be created and set in the calendar of activities being mailed on a monthly basis. Sales Tactics The server will constantly ask the customers if they want extra items such as soups, specialty coffee with sandwich or dissert. This will not just grow the revenue for the business but it will as grow the amount of cash that the sever will be creating. Many customer tip as per the portion of the check, the higher the check, the greater the tip. The serve might manager the own revenue. Ever table will have table tent or advert. The tent will explain the upcoming event. Furthermore, a picture and description of tem for sale like the beers, dessert and many more will be on the tent. The menu will provide comprehensive description of the time existing inclusive of the section that describes the diverse kind of beers existing. Service/Warranty Where the clients have complaints, everything will be done to content the customer. If the that does not work, the client will be provided their meal without a charge. Product Distribution The products will be supplied in the restaurant by the food servers. The food will be prepared on-site, other than some baked goods. Of these will be croissant, which will be bought in raw frozen form and baked on daily basis. When a client enters the coffee shops, they will be welcomed by hostess who will make sure that the customers get space to seat and eat (Min, 2016). The drink orders will be prepared b y the servers. Where the drink is beer, coffee, or wine, this will be ordered for preparation by the bartenders. The order will be provided to the bartenders on documented check, which will be rung up on the register. If the servers fix the drink, it will be rung up on the register by the servers. The servers will provide the drinks and afterwards takes the food order if the client is prepared. The servers will take food orders, ring it up and order will be provided on the computer screen for the cooker. The cooker will prepare the food in the sequence of order ticket provided and cooked food will be placed on the window and the sever will supply them to the customer. Sales Budget Table: Sales Budget Sales Year 1 Year 2 Year 3 Coffee $ 35,000 $ 80,000 $ 150,000 Snacks $ 75,000 $ 120,000 $ 180,000 Bears $ 80,000 $ 16,000 $ 340,000 Total Sales $ 190,000 $ 216,000 $ 670,000 Direct Cost of Sales Direct Material $ 12,500 $ 22,500 $ 30,500 Direct labor $ 6,500 $ 8,250 $ 10,200 Direct Cost $ 8,500 $ 9,500 $ 11,500 Overheads $ 5,500 $ 7,500 $ 8,500 Subtotal Direct Cost of Sales $ 33,000 $ 47,750 $ 60,700 Management Summary Chef executive director The person will be responsible for overseeing the over business operation and ensuring that the overall strategic objective of the business is attainable and within the path Chief accountant the chief accountant will be in charge of the accounting department and will responsible for ensuring that the company is having effective cost control and preparing budget and forecasts for the business (Kadre, 2015). Chief accountant plays an important role ion ensuring that the company continuity is guaranteed. This is attained by ensuring that there is an effective cost control and effective sales forecast. Senior marketing management The sales manager will be responsible for the overall marketing department of the common. The main duty will focus mainly on advertising the company and it product. Overview the organization structure Financial Plan Start-up Funding Assets Non-cash Assets from Start-up Cash Requirements from Start-up $ 487,800.00 Additional Cash Raised $ 55,000.00 Cash Balance on Starting Date $ 35,000.00 Total Assets $ 577,800.00 Liabilities and Capital Liabilities $ 45,000.00 Current Borrowing $ 80,000.00 Long-term Liabilities $ 95,000.00 Accounts Payable (Outstanding Bills) $ 45,000.00 Other Current Liabilities (interest-free) $ 15,000.00 Total Liabilities $ 280,000.00 Capital Planned Investment $ 250,000.00 Owner $ 120,000.00 Investor $ 80,000.00 Additional Investment Requirement $ 55,000.00 Total Planned Investment $ 505,000.00 Loss at Start-up (Start-up Expenses) $ 8,500.00 Total Capital $ 513,500.00 Total Capital and Liabilities $ 793,500.00 Total Funding $ 1,371,300.00 Projected Profit and Loss Forecasted profit and Loss   Year 1 Year 2 Year 3 Sales 190000 216000 670000 Direct Cost of Sales $33,000 $47,750 $60,700 Other Costs of Sales $25,500 $33,150 $43,095 Total Cost of Sales $58,500 $80,900 $103,795 Gross Margin $131,500 $135,100 $566,205 Gross Margin % 69% 63% 85% Expenses       Rent $8,000 $8,000 $8,000 Electricity $3,500 $3,850 $4,235 wages $8,500 $9,350 $10,285 Utilities $5,500 $6,050 $6,655 Insurance $7,300 $8,030 $8,833 Payroll/Salary $15,500 $17,050 $18,755 Other $4,500 $4,950 $5,445 Total Operating Expenses $52,800 $57,280 $62,208 EBUTDA   $0 $0 Depreciation expense $45,000 $49,500 $54,450 Profit Before Interest and Taxes $33,700 $28,320 $449,547 Interest Expense $8,500 $9,550 $10,500 Net Profit $25,200 $18,770 $439,047 Net Profit/Sales 13.3% 8.7% 65.5% References Abrams, R. 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