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The Lovato Bakery CaféThe Lovato Bakery CaféBusiness PlanBusiness Plan

GENERAL MANAGERGENERAL MANAGER

INTRODUCTION"LOVATO BAKERY CAFÉ"

OWNER AND PARTNERS

Main Founder: Nurul Azura binti Ahmad (General Manager)

Partners:Nurul Syazwin binti Zakaria (Administration Manager)

Nor Siti Aisyah Binti Shoeb (Marketing Manager)Nur Shamira Binti Abdul Manaf (Operation Manager)Mardhiah Binti Muhamad Sham (Financial Manager)

INTRODUCTIONINTRODUCTIONINTRODUCTION

Nature of Business: Food BusinessForm of Business: Partnership

Main Activity: Produce and Selling Cheese TartFlavor: Strawberry, Blueberry, Orange, Kiwi, Chocolate

Date of Establish : 20th March 2013Business Address: LOVATO BAKERY CAFÉ No.4, Ground

Floor, Lorong Kolam Air Lama 1, 68000 Ampang, Selangor Darul Ehsan

Contact Number: 03-5553433E-mail: lovatobakerycafe@yahoo.com

Facebook: http://www.facebook.com/lovatobakerycafe

HISTORYABOUT THE COMPANYABOUT THE COMPANY

At the beginning, we run a virtual business and we decided to open a franchise because we got a good

response from our existing customers. At the time, we run the business by ourself and we also hire 1 worker under

Marketing Manager and 9 workers under Operating Manager.

Our franchise provide:

Air conditionerElectricity Free Wi-Fi

LOCATIONLOCATION

No.4, Ground Floor, Lorong Kolam Air Lama 1, 68000 Ampang, Selangor Darul Ehsan

ADMINISTRATIVE PLANADMINISTRATIVE PLAN

INTRODUCTION 

Lovato bakery café is a company selling only pastry good which specialize in tarts. The reason we name our company “Lovato bakery café” is because we

operate in a small shop located near office, residence and we sell “mini” pastries. Everything

we sell is linked to the word “mini”.

Vision To produce quality deserts to a consistently high

standard.

Mission 1) We provide the best possible service to our customers

that meets or exceed their expectation. 2) We continually strive to meet higher standards inour

operations for the benefit of our staff and customers. 3) We also maintain a friendly, fair, and creative work

environment, which respects diversity, new ideas, and hard work.

 Objective 1) To offer our customer the fresh desserts. 2) Achieve 99% customer satisfaction and develop repeat 3) customer base. 4) Create stable customers. 5) Increase dessert production to meet the required

demand.

Schedule and Task Schedule and Task ResponsibilitiesResponsibilities

General Manager The general manager’s responsibilities involve supervision, public relations, marketing,

profitability and sales, service, reporting, capital requirements, and other duties as assigned by the board of directors. The general manager will maintain a positive attitude that

promotes team work within the cooperative and a favorable image of the cooperative.

Marketing Manager Defined as the activities that are carried out systematically to encourage and

increase sale of products/services as long as the activities are in line with religious and ethical practices. It is also maintaining customer, monitoring and analyzing market trends and studying competitors' products and services.

Financial Manager Financial managers control a organization's assets, including its investments

and cash, to maximize their efficient use.

Operation Manager The responsibilities of an operations Manager involves the process of planning, designing, and operating production systems and subsystems.

Administrative Manager The administration of any business forms an

important base from which the business routines are maintained and controlled.

ADMIN BUDGETADMIN BUDGETFixed assets

Expenses(RM)

Monthly Expenses(RM)

Other Expenses (RM)

Furniture and Fittings

4 000 - -

Salaries - 8 050 -

Rental - 3 000 -

Rental Deposit - - 9 000

Utilities Deposit - - 1 000

Petrol - - 300

Business registration and

license

- -3 000

Total 4 000 11 050 13 300

MARKETING PLANNINGMARKETING PLANNING

Lovato Bakery Cafe twist is its authenticity. By offering light and sweet tastes of cheese tart with different and variety flavor that is prepared from premium ingredients that contain real cheese benefits, it is guaranteed to satisfy the most discerning taste buds.

PRODUCT DESCRIPTIONPRODUCT DESCRIPTION

Our company provide product such as dessert that is mainly made up with cheese tart. This cheese tart was combined with fruit topping to ensure that it have its own specialty. This type of product are already exists. So we make up a new ideas from the existing product in the industry and came out with our own product line and branding (LOVATO BAKERY CAFE). Mainly, we follow up the hot trend and lifestyles of peoples. Nowadays, most people want something new and we are ready to improve and develop more products to ensure that we manage to fulfill our customer’s needs.

Product FeaturesProduct Features

• We offer varieties of flavor for cheese tart and varieties of toppings. We also provide 5 type of foods.

 • TOPPING• Chocolate • Blueberries• Strawberry• Orange• Kiwi

Targeted MarketTargeted Market

• In Cheras there is 587,550 peoples living here covering an area 59.31 km2. Gender of male is 82,582 peoples and female is 80,968 peoples.

• We have selected these two places because it has high population of residency and they are places where people are ready to spent money and shopped. We have specifically chosen these strategic locations for our product to be promoted and sell.

Geographic SegmentationGeographic Segmentation

• Due to this segment, our company set up this business on place with high populations which are the centre of AMPANG cities where many people around nation gather for many purpose. People who live in the cities are more aware and educated about tastes, therefore this place is strategic to do the business along with the company vision. We target to getter customer from Ampang around 20,036 peoples.

Demographic SegmentationDemographic Segmentation

• Age and Life-Cycle Stage

Our products are suitable for all age of consumer which include from kids until the elderly. We target customer from age 13-60 years old. And also child among 6-12 years old

Gender SegmentationGender Segmentation

• Since our products are favourite and healthy food, we provide to all gender. Because our product is suitable for all gender. Its provide suitable design and taste of food for men and female. We had survey that around Ampang we have 20,036 customers.

Gender Population

Man 10008

Female 10028

Income SegmentationIncome Segmentation

• Since our company located in town, so range of income is more from middle-income group to high-income group. Price of our product is not so expensive. So customer from lower-income group also can purchase our product.

Psychographic SegmentationPsychographic Segmentation

• Our products are basically for consumers which consume healthy lifestyle and educated social life. Those who love cheeses, fruits and sweets and have high awareness toward health will be our main target.

Market SizeMarket Size

• Market size refers to the total potential purchase of the market. This includes purchase a competitor’s product within the same market in order to identifies their quality and price of their products.

BI

L.

Costumers SALES/ANNUALLY (RM)

1 Teenagers 600,000

2 Children 150,000

3 Adult and Older 350,000

  TOTAL 1100,000

COMPETITIONCOMPETITION

• After viewing the market, we find that we have three competitor. The competitor is Nabe Bakery Café, Meor Bakery and Just Lildaisy Bakery.

• Nabe Bakery Café : This cafe in Ampang was bustling, filled with mostly

Korean patrons. We found out that Nabe Bakery Cafe is manned by a Korean husband and wife team, and that they use mainly ingredients imported from South Korea for their cakes and breads. This company also offered international food and trended now. But this company is not satisfied our Asian customer which like to taste something more unique but simple like cheese tart.

• Meor Bakery :

Meor Bakery has a unique position within the baked goods industry.  They offered all type of bread, muffin. Their company prefer order for the ceremony. But their company did not have enough qualities in making tasty cheese tart.

•Just Lildaisy :This bakery good in making cake and bread. Their more refer for event like party. This bakery not provide cheese tart for the customer.

Market ShareMarket Share

market share before Lovato entering the market

BIL. COMPANY MARKET

SHARE

SALES/ANNUALLY

(RM)

1 Nabe Bakery Cafe 36% 396,000

2 Meor Bakery 32% 352,000

3 Just Lildaisy 32% 352,000

  TOTAL 100% 1100,000

Market share after enter the market :

Sales ForecastSales ForecastSales Forecast For LOVATO BAKERY CAFE Year 2013

Month Sales collection

January

RM90,000

February

RM85,000

March

RM92,000

April

RM91,000

May

RM87,000

June

RM95,000

July

RM89,000

August

RM95,000

September

RM95,000

October

RM93,000

November

RM90,000

December

RM98,000

Total

RM1100,000

Marketing StrategiesMarketing Strategies

Product

• LOVATO attributes are its ability to meet or exceed customer expectations consistently, its speed in responding to customers demand, and its anticipation of new customers. LOVATO want to create some product that can create value to the customers and give them satisfaction. LOVATO want make cheesetart that will be named in the town. LOVATO trademark is “cheesetart best in the town ever”

Packaging

• Some design and packaging that so attractive for customer. Suitable for teatime, celebration, gift and etc.

• Ours packaging is compatibility with the product, processing and storage conditions

• product protection from chemical, physical and biological sources of deterioration

• suitability for the intended final use of the product (microwavable)

• ability to withstand the stresses of distribution (won't degrade or break)

Labelling

• Nutrition labelling refers to the standardized presentation of the nutrient content of a food. Found on food labels under the heading, "Nutrition Information", nutrition labeling includes serving size in household units and nutrients per serving. Usually energy (calories) protein, fat and carbohydrates are listed.

Product Labelling

Quality

• Ours product is very qualified because of the ingredients, mixing, attractiveness and tastes. We had make cheese tart with quality and nutrition ingredient. And we mixing it with favorite flavors. We also make it look attractive and make it tastes that everyone will love it.

Pricing

• LOVATO provide high quality speciality cheese tart product that customized to its customer needs. The value of product is reflected in its premium price

PRICE = COST PER UNIT + MARK-UP =RM0.80 + ( 25% × RM0.80) =RM0.80 + RM0.20 =RM1.00

DISTRIBUTION STRATEGY

• DIRECT TO CUSTOMERLOVATO provide personal selling to the customers. Where

customer can directly deals with LOVATO to make purchasing. Customer can make order via email, online and direct to counter at LOVATO BAKERY CAFÉ, No. 4, Ground Floor, Lorong Kolam Air Lama 1, 68000 Ampang. Customer also can make online order in LOVATO facebook inbox, or emailing to lovatobakery@yahoo.com

• LOVATO CUSTOMERS

Promotion

SignboardSignboard

MARKETING BUDGET FOR LOVATO BAKERY CAFÉ YEAR MARKETING BUDGET FOR LOVATO BAKERY CAFÉ YEAR 20132013

ITEMS TOTAL UNIT PRICE PER

UNIT (RM)

TOTAL

COST

BROCHURES 3,000 1.00 RM1.00 ×

3,000 units

= RM 3,000

SIGNBOARD

2 300 (RM300 x 2)

= RM 600

BUSINESS CARD 2,500 0.20 RM 0.20 ×

2,500 units

= RM 500

ADVERTISEMENT

(MEDIA MASSA-

NEWSPAPER)

(5CM × 5CM = RM

200)

  130 RM 200 × 12

months

= RM 2400

TOTAL COST     RM6500

OPERATION MANAGEMENTOPERATION MANAGEMENT

INTRODUCTIONINTRODUCTION

• Objective of operation department is to provide better quality of product, punctual to due date and will make the customers satisfied towards our product

• Main focus in operation management is to provide diverse of healthy flavour in mini cheese tarts that we produced and supply in high quality to fulfil our customer needs and wants.

Process of Flow ChartProcess of Flow ChartMeasure flour, egg, butter, sugar, cream cheese, vanilla essence,

etc.Measure flour, egg, butter, sugar, cream cheese, vanilla essence,

etc.

Mix and blend ingredientsMix and blend ingredients

Ensure that the dough is of the right qualityEnsure that the dough is of the right quality

The dough is formed into required shapeThe dough is formed into required shape

The crust are baked at 90-110◦C for 20-25 minutesThe crust are baked at 90-110◦C for 20-25 minutes

Crust are taken out from the oven to coolCrust are taken out from the oven to cool

Crust of poor quality are separated/rejectedCrust of poor quality are separated/rejected

Crust are filled with fruits and cream cheese that has been prepared earlier

Crust are filled with fruits and cream cheese that has been prepared earlier

Tarts are baked at 90◦C for another 15 minutesTarts are baked at 90◦C for another 15 minutes

Tarts are taken out and packed into packagesTarts are taken out and packed into packages

The packages are inspected before being placed into boxesThe packages are inspected before being placed into boxes

The boxes are placed in the store before being distributed to the market

The boxes are placed in the store before being distributed to the market

Material RequirementMaterial RequirementList of materials required

INGREDIENTAMOUNT REQUIRED FOR 60

TARTSFlour 290 gmEggs 2 unitsCaster Sugar 50 gmIcing Sugar 50 gmVanilla Extract 2 mlCream Cheese 250 gmCocoa Powder 177 mlButter 170 gm

Bill of materials per unitINGREDIENT AMOUNT REQUIRED/TARTSFlour 5 gmEggs 0.03 of an eggCaster Sugar 0.83 gmIcing Sugar 0.83 gmVanilla Extract 0.03 mlCream Cheese 4.2 gmCocoa Powder 2.95 mlButter 2.83 gm

Quantity of raw materials required

INGREDIENT AMOUNT REQUIRED/monthFlour 5 gm x 50,000 = 250,000 gm

Eggs 0.03 of an egg x 50,000 = 1,500 gm

Caster Sugar 0.83 gm x 50,000 = 41,500 gm

Icing Sugar 0.83 gm x 50,000 = 41,500 gm

Vanilla Extract 0.03 ml x 50,000 = 1,500 ml

Cream Cheese 4.2 gm x 50,000 = 210,000 gm

Cocoa Powder 2.95 ml x 50,000 = 147,500 ml

Butter 2.83 gm x 50,000 = 141,500 gm

Manpower Manpower Requirement Requirement PlanningPlanning

Position No. Job StatusRemuneration

per Month

EPF

(13%)

Socso

(2%)Total

Bakery Clerks 2 Permanent RM 900 RM 117 RM 18RM 1,530

(RM 765 x 2)

Food

Preparation

Worker

6 Permanent RM 900 RM 117 RM 18RM 4,590

(765 x 6)

Supervisor 1 Permanent RM 950 RM 124 RM 19 RM 807

Operations Layout PlanOperations Layout Plan

LocationLocation

Operation BudgetOperation BudgetParticular Fixed

AssetsMonthly

ExpenditureOthers Total

Machine requirement

RM 3,596 RM 3,596

Working capitalRaw materials RM 545.40 RM 545.40Carriage inward and DutySalaries, EPF and SOCSO

RM 7,734 RM 7,734

Operation overhead

RM 9,479.40 RM 9,479.40

Pre-operation and other expenditureOther expenditureDeposit (rent, utilities, etc)

RM1,200 RM 1,200

Business Registration and LicencesInsurance and Road tax for motor vehicleOther pre-operations expenditureTotal RM 3,596 RM 19,058.80 RM 22,654.80

FINANCIAL PLANFINANCIAL PLAN

Introduction of financial planIntroduction of financial plan

• A financial plan incorporation all financial data derived from the operation budgets in example the marketing, production or operation and administration.

• Based on this financial data, projections are then prepared via several pro forma statements, namely cash flow, income (profit and loss) statement and balance sheet.

• The importance of financial plan is– To determine the size of investment– To ensure that the initial capital is sufficient– To identify and propose the relevant sources of

finance.

The process of developing a The process of developing a financial planfinancial plan

Step 1 : Gather all financial input Step 2 : Prepare the project implementation Step 3 : Prepare the sources of finance schedule Step 4 : Prepare the pro forma cash flow

statement Step 5 : Prepare the pro forma income statement Step 6 : Prepare the pro forma balance sheet Step 7 : Perform financial analysis based on the

above pro forma statements

Project implementation cost• The table shows that project implementation cost for the production of

cheese tart. The fixed cost assets own by our company are equipment, office furniture, and machine.

• Total working capitals that cover administrative, marketing and operational budget are RM 37,460. Cost for pre-operations and other expenditure are RM 5276.

Cost

30,000

600

3,596

Working Capital 1 months

22,275

6,935

8,280

25,679

Contingencies 5% 4,868

TOTAL 102,234

Signboard

Pre-Operations & Other Expenditure

Administrative

Marketing

Operations

Machine

Requirements

Fixed Assets

Land & Building

Office Equipment

Source of FinancingSource of FinancingThe table show the source of finance for LOVATO BAKERY CAFÉ. The source of finance come from a loan, hire-purchase and own contribution by each members of the company.

Requirements Cost Loan Hire-Purchase

Own Contribution

Fixed Assets Cash Existing F. Assets

Land & Building

Office Equipment 30,000 30,000

Signboard 600 600

Machine 3,596 3,596

Working Capital

1 months

Administrative 22,275 22,275

Marketing 6,935 6,935

Operations 8,280 8,280

Pre-Operations & Other Expenditure

25,679 20,403 5,276

Contingencies 5% 4,868 50 4,818

TOTAL 102,234 20,454 81,780

Cash flow pro-FormaCash flow pro-Forma

MONTHPre-

Operations1 2 3 4 5 6 7 8 9 10 11 12

TOTAL YR 1

YEAR 2 YEAR 3

                         CASH INFLOW                        Capital (Cash) 81,780                 81,780    Loan 20,454                 20,454    Cash Sales 90,000 85,000 92,000 91,000 87,000 95,000 89,000 95,000 95,000 93,000 90,000 98,000 1,100,000 1,210,000 1,265,000 Collection of Accounts Receivable                        TOTAL CASH INFLOW 102,234 90,000 85,000 92,000 91,000 87,000 95,000 89,000 95,000 95,000 93,000 90,000 98,000 1,202,234 1,210,000 1,265,000                        CASH OUTFLOW                      Administrative Expenditure                      Salary 16,500 16,500 16,500 16,500 16,500 16,500 16,500 16,500 16,500 16,500 16,500 16,500 198,000 217,800 250,470 Rental 3,000 3,000 3,000 3,000 3,000 3,000 3,000 3,000 3,000 3,000 3,000 3,000 36,000 39,600 45,540 Petrol 300 300 300 300 300 300 300 300 300 300 300 300 3,600 3,960 4,554 Vehicle Budget                        SOCSO &EPF 2,475 2,475 2,475 2,475 2,475 2,475 2,475 2,475 2,475 2,475 2,475 2,475 29,700 32,670 37,571                                                   Marketing Expenditure               Promotion 5,900 5,900 5,900 5,900 5,900 5,900 5,900 5,900 5,900 5,900 5,900 5,900 70,800 77,880 89,562 Salary 900 900 900 900 900 900 900 900 900 900 900 900 10,800 11,880 13,662 EPF&SOCSO 135 135 135 135 135 135 135 135 135 135 135 135 1,620 1,782 2,049                                                                                                     Operations Expenditure               Cash Purchase                        Payment of Account Payable   546 546 546 546 546 546 546 546 546 546 546 6,006 6,552 7,207 Carriage Inward & Duty                        Salaries, EPF & SOCSO 7,734 7,734 7,734 7,734 7,734 7,734 7,734 7,734 7,734 7,734 7,734 7,734 92,808 102,089 117,402                                                                                                     Other Expenditure 13,479                 13,479 14,827 17,051 Pre-Operations                        Deposit (rent, utilities, etc.) 11,200                 11,200    Business Registration & Licences 1,000                 1,000    Insurance & Road Tax for Motor Vehicle                        Other Pre-Operations Expenditure                        Fixed Assets                        Purchase of Fixed Assets - Land & Building                        Purchase of Fixed Assets - Others 34,196                 34,196    Hire-Purchase Down Payment                        Hire-Purchase Repayment:                       Principal                         Interest                        Loan Repayment:                         Principal 341 341 341 341 341 341 341 341 341 341 341 341 4,091 4,091 4,091 Interest 85 85 85 85 85 85 85 85 85 85 85 85 1,023 818 614 Tax Payable                 0 0 0 0TOTAL CASH OUTFLOW 46,396 50,850 37,916 37,916 37,916 37,916 37,916 37,916 37,916 37,916 37,916 37,916 37,916 514,323 513,949 589,773 CASH SURPLUS (DEFICIT) 55,838 39,150 47,084 54,084 53,084 49,084 57,084 51,084 57,084 57,084 55,084 52,084 60,084 687,911 696,051 675,227 BEGINNING CASH BALANCE

  55,838 94,988 142,072 196,156 249,240 298,324 355,408 406,491 463,575 520,659 575,743 627,827   687,911 1,383,962

ENDING CASH BALANCE 55,838 94,988 142,072 196,156 249,240 298,324 355,408 406,491 463,575 520,659 575,743 627,827 687,911 687,911 1,383,962 2,059,189

Profit and Loss Pro-Profit and Loss Pro-FormaForma        Year 1 Year 2 Year 3

Sales 1,100,000 1,210,000 1,265,000

Less: Cost of Sales      

Opening Stock of Finished Goods   20,000 20,000

Production Cost 99,549 110,045 125,676

Less: Ending Stock of Finished Goods 20,000 20,000 40,000

0 0 0

79,549 110,045 105,676

Gross Profit 1,020,451 1,099,955 1,159,324

Less: Expenditure      

Administrative Expenditure 267,300 294,030 338,135

Marketing Expenditure 83,220 91,542 105,273

Other Expenditure 13,479 14,827 17,051

Business Registration & Licences 1,000    

Insurance & Road Tax for Motor Vehicle      

Other Pre-Operations Expenditure      

Interest on Hire-Purchase      

Interest on Loan 1,023 818 614

Depreciation of Fixed Assets 6,120 6,120 6,120

Total Expenditure 372,142 407,337 467,193

Net Profit Before Tax 648,309 692,617 692,131

Tax   0 0 0

Net Profit After Tax 648,309 692,617 692,131

Accumulated Net Profit 648,309 1,340,926 2,033,057

Balance Sheet Pro-FormaBalance Sheet Pro-Forma      Year 1 Year 2 Year 3

ASSETS      

Non-Current Assets (Book Value)      

Land & Building      Office Equipment 24,000 18,000 12,000

Signboard 480 360 240

Machine 2,877 2,158 1,438

Other Assets      

Deposit 11,200 11,200 11,200      

38,557 31,718 24,878

Current Assets      

Stock of Raw Materials 530 500 480

Stock of Finished Goods 20,000 20,000 40,000

Accounts Receivable      

Cash Balance 687,911 1,383,962 2,059,189

708,441 1,404,462 2,099,669

TOTAL ASSETS 758,198 1,447,379 2,135,747

Owners' Equity      

Capital 81,780 81,780 81,780

Accumulated Profit 648,309 1,340,926 2,033,057

730,089 1,422,706 2,114,837

Long-Term Liabilities      Loan Balance 16,363 12,272 8,181

Hire-Purchase Balance      

16,363 12,272 8,181

Current Liabilities      Accounts Payable 546 1,201 1,529

TOTAL EQUITY & LIABILITIES 746,998 1,436,179 2,124,547

Questions/Comments ?Questions/Comments ?