This business plan covers the details of Cherry Forest Bakers, a bakery in London, UK. It includes industry and market analysis, customer and value proposition, marketing strategy, and more.
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Table of Contents INTRODUCTION...........................................................................................................................4 MAIN BODY...................................................................................................................................4 The business detail.................................................................................................................4 Industry and market analysis..................................................................................................4 Customer and value proposition.............................................................................................7 Marketing strategy..................................................................................................................1 Operating plan........................................................................................................................3 Management team and company structure.............................................................................4 Resources................................................................................................................................4 Financing................................................................................................................................5 Financial projections..............................................................................................................5 Risks and strategic options.....................................................................................................7 Key milestones.......................................................................................................................7 CONCLUSION................................................................................................................................7 REFERENCES................................................................................................................................9
INTRODUCTION Business plan is defined as the written document of various activities that are going to take place in order to provide succession to the proposed plan(Ivanisevic and et. al., 2016). With the help of appropriate business plan a new venture can be established in significant manner due to which their goals and objectives can be attained in such a manner that no resource get wasted. This plan is based on business plan of a Bakery which is going to be initiated in UK. The bakery is named as Cherry Forest Bakers. The bakery is going to provide higher quality cakes and cookies which are prepared on order basis in order to maintain freshness. This overall business plan is demonstrating various aspects of business along with competitors analysis. MAIN BODY The business detail The business plan under this report is covering the plan for initiation of new venture named Cherry Forest Bakers which is a bakery and going to be open in London, UK. The bakery is associated with producing cookies and cakes on instant basis in order to provide customer satisfaction to their clients. The company is going to offer numerous variety of cookies and cakes which can satisfy needs and demands of huge customers. For promoting their business they are going to use social media and advertisement hoardings so that to spread awareness regarding their business and product offerings. Industry and market analysis PESTLE analysis This is an analytical framework used in order to analyse macro environment factors as this could be helpful in evaluating different implications which are having direct impact over business operations. PESTLE analysis is associated with six factors such aspolitical, economic, social, technological, legal and environmental which are existed within business environment. Cherry Forest Bakers is going to establish their business as a bakery which is situated in London, UK(Efstathiou, 2018). There are numerous factors due to which the new venture may face implications and the same are elaborated as under: Political factor:These factors are associated with government policies, foreign trade policies, laws of labour and stability within political conditions. These factors may impact business activities and whenCherry Forest Bakers is planning to operate in the
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markets of London then this is imperative that they understand all the governmental policies along with reaching out to customers as well. Cherry Forest Bakers is opening their bakery business in market of London and this is a known fact that governmental policies within UK are liberal so this would be easier for Cherry Forest Bakers to run their business. Economical factor:These factors are associated with economic growth, exchange rate and inflation rate. Economic condition of UK is stable due to which people are prone go for innovative products and higher customer service quality. The quality offered by Cherry Forest Bakers is optimal so they have high chances for market survival along with attaining high market focus(Xu, 2018). Social factor:These factors are linked with social culture and needs or preferences of customers in relation to some particular commodity. These factors are linked with age, growth and gender of people due to which businesses can easily frame their strategy to grow.Cherry Forest Bakers is initiating their business in bakery sector in which variety of cookies and cakes are prepared by them which is aligned with need and preferences. Technological factor:These factors are linked with using innovation and emerging technology within business. The company is providing prompt service to their customers and for this latest technologies are used by them. This will help the company to align their goals and objectives with business efforts. This will help the company to meet expectations of customers by updating their business with new technology. Legal factor:These factors are associated with laws which relates to employee health and safety. Besides this laws related to labelling are also required to be followed by production concern. In order to align with legal aspectsCherry Forest Bakers is using all those legal obligations so that to stay away from any legal boundations. This is helpful for Cherry Forest Bakers to place their product in market within appropriate manner (Freedman, 2020). Environmentalfactor:Thesefactorsarelinkedwithissuesofenvironmentand minimising harm to environment by using such practices as well.Cherry Forest Bakers is using environmental friendly techniques of production so that to minimise harm to environment and leading the business in desired manner. Porter's five force model
This is a tool used by businesses in order to analyse intensity of industry and existed competition within industry as well(Muravyev, Talavera and Weir, 2016). Due to various forces business operations get hampered and in the same manner functionality of the business can be affected. This model was developed by Micheal E. Porter in the year of 1980 in order to provide ability to the business for reaching out to attaining objective of earning profits. This approach is having 5 aspects which are elaborated as under:Competition in the Industry:This factor is defined as existed level of competition within industry. This is helpful in analysing conditions of rivals and the ways which are adopted by them to attract customers. This could help in dealing with market competition in appropriate manner. Under this the company is having various competitors within market which creates higher threat for the company to grow in proper speed. In case of cherry forest bakery also, rivalry was high because many competitors were offering same kind of products and they had to compete with them on the basis of price, quality as well as relation with customers. New entry in the market:This dimension is associated with ease of entry by a business to a new market. This factor may impact the business to slow down their pace of development and facing problem in acquiring new markets.Cherry Forest Bakers is performing market research in appropriate manner due to which they can understand needs and demands of their customer in significant manner. Under this threat low existence is seen as in the market of food it is not easy to get enter and develop their own market.In context with cherry forest industry the economies of scale were beneficial due to which they had effective distribution channels which was helping them to grow their business. So, when new competitors enter the market they were not facing much threat from them. Power of suppliers:This force is defining power hold by suppliers existed within industry (Oliver, 2017). Due to high demand of any product supply for raw material will also be increased.Cherry Forest Bakers is having various suppliers as the company is dealing in diversified product range. So this force is providing low impact to the organisation as they have power to switch their supplier from one to another. Power of customers:This force is defined as power hold by customers in relation to price fluctuation. In the industry of retail customers are treated as the major target due to
which they hold high power. The customers are having various options to switch so they hold high power. In this caseCherry Forest Bakers is required to introduce prominent quality in their goods and services in order to attain attraction of their customers. Threat of substitution: This force is defined as existing substitution within market which may impact working of the business in negative manner. For Cherry Forest Bakers this is necessary for them they analyse market competition and availability of substitute so that to acquire market edge(Mogaji, Farinloye and Aririguzoh, 2016).As, the bakery products which they were offering other companies were also offering the same quality products at effective prices and when customers purchase any kind of bakery product they don't think from which bakery they have to purchase. Competitor analysis There are various competitors existed for Cherry Forest Bakers due to they may face various difficulties. This is highly essential for Cherry Forest Bakers that they offer appropriate quality in order to compete with their rivals and to analyse market trend and customer potential as well. Oven the bakery is the major competitor for Cherry Forest Bakers as that is an established company and renowned in London. Oven the bakery is giving fierce competition for Cherry Forest Bakers so in order to align their goals and objectives with needs of their customer Cherry Forest Bakers is required to manage their business offerings in distinct manner. Customer and value proposition The USP forCherry Forest Bakers is that they are producing cakes and cookies as per order basis. This is the major feature of Cherry Forest Bakers which is helpful for them to attain market edge and competence.
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Marketing strategy Marketingplandeterminesmarketingstrategybeingappliedbyorganization.It represents the overall business plan according to which goals are being achieved. Company overview:The report is based on Cherry Forest bakery. It has been established in London, UK. The company will provide many bakery products like cookies, pastries, muffins and even decoration items. The main target of company will be young age people who love cookies and pastries. The bakery also includes a comfortable area where people can sit. Apart from young age people target is also on tourists. vision and mission:The vision of cherry forest bakery is to educate employees as well as the audiences regarding the fresh baked products as from where their products are as well as what it contains. The company also has the vision of providing best quality baked products in whole London. The mission of Cherry forest bakery is to establish their bakery in such a way that they bake best quality products, create the environment in which employees can learn more as well as innovate new strategies as well as ideas which will help their bakery to grow. Market research:It means an effort done by organizations to collect all information about their target markets, customers and know about their likes as well as dislikes (Alvarez and et. al., 2020). There are many methods that a company can use to analyse their market like surveys, focus groups, observations, social media and so on. In context with Cherry forest bakery they can use the method of surveys as well as social media listening. With the help of surveys, some questions are asked from people so that they can give feedback about their experience and then make changes to attract them. It is also beneficial for them because its a very easy process as well as inexpensive. The company can also use the method of social media listening because in today's world almost every one is active on social media and people can freely give their reviews as well as suggestions. STP Model in marketing plan:-Segmentation:-It means to implement different segments of customer based on their traits. It is done on the basis of four types that is geographic segmentation,demographic segmentation,behaviouralsegmentationandpsychographicsegmentation.Basedon geographic segmentation, cherry forest bakery will focus on London as well as its nearby areas. As there are other type of bakeries also but the products they will be providing is not been provided by any other bakery. Based on demographic segmentation the company has 1
itsfocusmainlyonyoungpeoplebecausetheylikeallbakeryproducts.Basedon behavioural segmentation they divide their customers on the basis of their likes as well as reviews through social media. Based on psycho graphic segmentation they divided their customers on the basis of their opinions (Harris, 2017).Targeting:-In this process businesses look at three segments and these are size of organization, profitability and reachability and while doing targeting various specialization are also been considered like selective specialization, product specialization. In context with cherry forest bakery their main target was to attract young people and innovate different varieties of baked products.Positioning:-It means to set a product in the minds of audiences as what is special in product as compared to their competitors. In case of cherry forest bakery there specialised products were their pastries and through this they applied many strategies like promoting through social media to position them in the minds of people. Sales process:-Benefit from efficient operations:-In context with bakery industry new changes in the form of innovations should always be done because it will be beneficial as well as easy for them to initiate new food trends in their bakery as compared to other large bakeries.Make the most out of promotions:-In a bakery industry it is difficult to have large profits and this can be only done if high quality products are been offered so in case of cherry forest bakery they were providing high quality products to improve their sales as well as promoted about their specialised products very well. Pricing strategy The pricing strategy which cherry forest bakery used is penetration pricing because their business was just opened so they offered their products at low prices as well as gave various offers which was a good strategy by them. Marketing mix Products This dimension of marketing mix is related with business offerings which are offered by a business organisation (Langemeier and Boehlje, 2017). In the context of Cherry Forest Bakery they are offering variety of cakes and cookies to their customers which are their major offerings. Besides this the USP for Cherry Forest Bakery is that they prepare cookies and cakes on order 2
basis that means they do not stock the same rather prepare them after receiving order so that to manage freshness. Price This dimension of marketing mix is associated with pricing tactics used so that high customers can be attracted and at the same time profits can be earned. For Cherry Forest Bakery they are using penetration pricing strategies in order to place their business in new market in significant manner. With the help of appropriate pricing strategy Cherry Forest Bakery can sustain in the market and retain their customer for longer duration of time. Place This aspect of marketing mix defines the place at which business is going to be operated. For Cherry Forest Bakery they are willing to initiate their business in London, UK which is a prominent location. The location is playing significant role in managing business functions and grabbing attention of potential customers as well (MacAlister, 2016). Promotion Promotion is categorised as the movement which is used by businesses so that to increase sales and provide awareness among customers. In the context ofCherry Forest Bakery they are using social media and display hoardings in order to promote their products and to meet their business objectives. Operating plan Cherry Forest Bakers is initiating their business in food industry as bakery business within markets of London. They are manufacturing cookies and cakes in instant manner so that to provide fresh cookies and cakes to their customers. They are keeping physical stores and under this majorly they are targeting to kids and youngsters. After getting success in markets of London they are planning to expand their business in some international markets as well which could be helpful for them to reach out to their business objectives. Under this training sessions are provided to employees of Cherry Forest Bakers so that they can attract huge number of customers. SWOT analysis StrengthWeaknesses Cherry Forest Bakers is coming withIn UK large numbers of competitors are 3
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varied variety of cakes and cookies. This is helpful for them to attract huge customersduetowhichappropriate profits can be earned. ThemajorUSPofCherryForest Bakers is that they are preparing cakes and cookies at instant basis which is a advantage for the organisation.. existed due to which high competition is being faced byCherry Forest Bakers. Highcostisanotheraspectdueto whichthecompanymayface difficulties. OpportunitiesThreats People within UK are prone to spend theirincomeoninnovativeeatable products. Due to implication of COVID 19 the companymayfacedifficultiesof placing their product in market. Management team and company structure Company structure is defined as the system of organisational structure which is outlining various activities in order to align organisational goals and objectives. These activities are related withappropriatedelegationofauthorities,rolesandresponsibilities.Ontheotherhand organisational structure is the deciding level in which information flow is taking place. In the context of CherryForest Bakers they are established as a sole proprietorship which minimises business complexities for them. Resources In order to start the business various resources are required by them and in the same manner which is desired. For CherryForest Bakers there major resources are human resource, financial resource and marketing resources(Alkaraan, 2017). Human resources are defined as human capital required in the business in order to run the business with utmost efficiency. In this mannerCherryForest Bakers do require human capital of 5 employees. Besides this financial resources are defined as the working capital which is required to run a business appropriately. Being a new venture the major capital needed byCherryForest Bakers is initial investment and working capital. At last marketing resources are categorised as acquiring those markets in which high sales can be made byCherryForest Bakers. 4
Financing In order to start new venture capital is the foremost aspect which is needed. CherryForest Bakers is collecting their capital from bank loan as this is a low interest method which can be used by businesses so that to acquire higher money assistance. Financial projections Finance is the foremost resource which is required by a business as this provides higher opportunities to the company for growth and sustainability. Financial resources are helpful in gatheringtheentiremajorrequirementsuchaspurchaseofrawmaterialandmanaging machineries (Brustbauer, 2016). Profit and Loss Statement 2020 Sales250000 Less : Sales Return10000 Net Sale240000 Cost of goods sold Direct Cost95000 Gross Profit145000 Gross Profit %58% Operating Expenses Salary45000 Insurance5500 Advertisement3500 Total Operating Expenses54000 Interest Incurred900 Depreciation1500 Total Expenses2400 Profit88600 Income Tax Paid2600 Net Profit86000 5
Cash Flow Statement 2020 Cash Flow from Operating Activities Net Profit86000 Add: Depreciation & Amortization1500 Increase in Accounts Receivables190000 Increase in Inventory Value-60000 Decrease in Accounts Payable10000 Change in Income Tax Liability-25000 Sales Tax-6000 Net Cash Flow from Operations196500 Cash Flow from Investing Activities Purchase of Bakery Machinery - 150000 Purchase of Furniture-25000 Sale of Fixed Assets20000 Investments Received15000 Net Cash Flow from Investing Activities - 140000 Cash Flow from Financing Activities Issue of Shares100000 Increment in retain earnings20000 Dividend Paid-35000 Net Cash Flow from Financing Activities85000 Closing Cash Balance141500 6
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Break Even Analysis 2020 Variable Cost200 Selling Price300 Fixed Cost2000 Contribution Per Unit100 Break Even200 Units Risks and strategic options The major risk associated with CherryForest Bakers is that they may fail in their market due to existence of huge competitors. This risk can be minimised by offering minimal prices and high quality products. Another risk is related to facing losses as market of UK is full of uncertainties which may create higher threat forCherryForest Bakers. Key milestones Key milestones are defined as the forward movement of the project in order to calculate its ratio of succession. This is helpful in keeping track record on the progression of project so that to calculate any variance from acquired plan. In this manner various methods can be used by CherryForest Bakers such as KPI(Alkaraan, 2020). KPI is an analytical tool which can be used so that to measure effectiveness and performance of the project.KPI is helpful in developing business effectiveness forCherry Forest Bakers which leads them to evaluate venture performance at every stage. CONCLUSION From the above mentioned detailed information this can be concluded that business plan is playing significant role in managing efficacy in business and new venture. With the help of business plan control over organisational plan can be executed which is aligned with business objectives. There are various elements within business plan such as financials, marketing plan, milestones and many more. These are assisting the business to stay ahead in the competition so that market prominence can be attained. Besides this organisational structure is assisting in order to provide roles and responsibilities to employees in appropriate manner so that overall goals can be aligned and met as well. 7
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