Business Plan for Sweet Tooth Cake Studio

This report discusses a detailed business plan for Sweet Tooth Cake Studio, including its description, industry analysis, market potential, marketing plan, operational plan, and financial projections. The report also covers the sources of finance for the business and concludes that the establishment of Sweet Tooth Cake Studio is feasible and sustainable in the long run.

Enterprise and
Entrepreneurship
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Table of Contents
Introduction.....................................................................................................................................3
Main body .......................................................................................................................................3
Description of business...............................................................................................................3
Industry analysis.........................................................................................................................3
Market potential and marketing plan..........................................................................................4
Operational plan..........................................................................................................................6
Financial projections...................................................................................................................6
Conclusion.......................................................................................................................................7
References.......................................................................................................................................8
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Introduction
Entrepreneurship refers to the process of creating value through applying innovative
ideas into developing goods and services for the purpose of earning profits. The risk bearing
factor is a crucial aspect and essence in the profession of entrepreneurship. Enterprise refers to a
business entity which indulge in performing various functions to provide individuals with
relevant goods and services in order to generate revenues (Audretsch and Moog, 2022). In this
report, my business plan is discussed in detail which would be of a cake studio that will be
operated under the label “sweet tooth”. This business aims to cater to the requirements of
customers through providing them a range of finest quality of cakes and pastries. This report
would cover full description of my business along with other relevant concepts like industry
analysis, market analysis and operational plan as well as financial projections.
Main body
Description of business
The establishment of the business idea “sweet tooth” would take place in London, United
kingdom which would be dealing in offering cakes and confectionery items. An appropriate
central location would be selected for this business plan where it can attract maximum attention
of individuals. In order to conduct the commercial functions of the sweet tooth, a shop having
area of 1000 sq ft would be availed on rent having two floors. On first floor, it would have
kitchen to perform all the baking functions and to keep raw materials for the production. The
ground floor would consist of a display cum serving area where minimalistic furniture would be
placed to provide consumers with dining experience.
The licenses that would be required for this business includes business license and food
service license. The business license would be issued by government and food service license
would be granted by London's health department to ensure our compliance with food safety and
hygiene regulations and standards (Ratten and Usmanij, 2020).
Industry analysis
Size of the market
In context to Sweet Tooth, the bakery industry is a huge business sector in United
Kingdom, which offers a range of varieties of breads, cakes, pies to potential buyers. The bakery
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market of UK is generating revenues of approximately £3.9 billion and is a very prominent
industry in the market of UK.
Barriers to entry
In order to succeed in long run through establishing cake studio which comes under
bakery sector, it would take a huge amount of capital and funds to compete with well-established
existing brands. Therefore, initially this business would be started as a small-scale business
entity which would be aiming to achieve maximum customer engagement through providing
speciality products at relatively less prices.
Threats to market
Due to the increasing awareness of consumers, the trend of gluten-free bread products is
consistently growing. The demand of sugar free, low-carbohydrate, whole grain and other
organic products have increased which creates challenges for the business to properly comply
with customer's demands (Silva and et. al.,2020). Moreover, the food and drug administration
department would be indulged in monitoring the operations of bakeries which would be a
constant challenge appearing in this business plan.
Outlook for the future
The market for bakery and confectionery products are expected to increase in future due
to disposal income and preferences and inclination of consumers. The large and renowned
bakeries such as Greggs would continue to maintain dominant position in the market creating
threats for small business owners. To ensure success in long run, expansion of operations and
product development as well as market development would be required as the business starts
growing.
Market potential and marketing plan
Competitive analysis
Threat of new entrants: this threat is likely to impact us as there are potential entrants who can
serve risks for the current business idea. Although the business would take advantage of
economies of scale to lower their costs and the central location would serve as a additional
benefit (Li, and et. al.,2020).
Competitive rivalry: the barriers to entry in such business is extremely high as there are many
entrepreneurs in the market which are dealing in confectionery products. The risk of this threat
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would be reduced through adopting various marketing strategies and adopted lower pricing
policies in the initial phase of business.
Bargaining power of suppliers: The power of suppliers is low in the context of my new business
idea as suppliers in this industry have less customers which reduces their negotiation power.
Bargaining power of buyers: this threat is high in context to my business as the huge availability
of bakery and confectionery products give them the power to negotiate for lower prices or else
they would shift their preferences.
Threat of substitutes: there is high availability and accessibility of these products to the
consumers which creates the risk of availability of substitutes resulting in shifting preferences of
consumers due to dissatisfaction. This threat could be reduced through adopting customisation
and low price strategy through utilising economies of scale.
Customer analysis
This cake studio would aim to achieve attention and inclination of all households and
residents. The products of bakery is preferred and needed by all types of individual irrespective
of their occupations and incomes (Trotter and et. al., 2019). The demographic segmentation
would be based on criteria of age, gender, family status and income levels. The consumption of
pastries and pies are more preferred by youngsters while households are mainly tend to buy
breads from the shop. The customised cakes for specific events are mainly cater to the
requirements of high-income level individuals.
Marketing plan
Advertising techniques: The cake studio, sweet tooth would make effective use of a number of
social media platforms to increase awareness and analyse audience engagement in the accounts
maintained on various social media platforms. In addition to this, the cake studio would
distribute pamphlets in nearby areas displaying all relevant information and to gain individuals
attention.
Creating a website: For effective marketing, building a website is very important as it displays
all the relevant information required by customers and helps in increasing brand awareness. The
sweet tooth website would consist of all necessary information related to address, phone
numbers and goods and services available along with pictures of the studio.
Fast delivery and quick service: Emphasis would be paid upon gaining maximum satisfaction of
consumers through focusing on customer services and taking orders and serving them fast.
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Moreover, through providing facility of online payments, fast transactions can be ensured
resulting in increasing convenience and satisfaction of customers.
Operational plan
The operational plan of this business would be supported with effective management
system and proper business functions required to generate revenues. In order to manage
operations of the business, the major considerations are discussed below:
Inventory Management: For effective inventory management, potential information management
software would be used to track purchases and stock.
Labour: The most important consideration is labour requirements as they are the basis of
performing operations which are required for earning revenues. Initially, four full time and two
part time bakers would be hired to perform all baking and cooking operations. As for the
management, two full time personnel would be recruited to maintain accounting functions and
oversee operations (Chernev, 2020). Apart from this two workers would be hired specifically for
serving purpose.
Equipments: Kitchen appliances like microwave, refrigerator and other utensils would be
procured along with other equipments including furniture and counter for displaying items.
Design and interiors: Sweet tooth is determined to create an aesthetic ambience for its potential
buyers which feels comfortable and cozy. It would be a place where individuals like to refresh
and catch up with their friends over some sweetness.
Online service: The existing staff along with managers and other workers would also take online
orders from consumers over phone or from our social media.
Financial projections
Income statement
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Sources of finances
For the initiation of this start-up, one of the most crucial decision is choice of sources of
funds. There are various short-term and long-term sources available in order to invest in a
specific start-up plan. To execute this business plan, following listed are the sources of finance
that would be used:
Savings account: I would use my personalised savings in order to procure ingredients and raw
food material for the process of production.
Short-term Bank loan: For the payments of rent and other costly expenses, I would raise a bank
loan in order to meet the requirements of more funds.
Selling of property or lease arrangements: for further expenses, I would capitalise funds through
selling furniture or other property or through dealing in lease arrangements which would fix my
monthly income.
Conclusion
From the above report, it has been concluded that this businesses is sustainable and
feasible in the long run. The bakery and confectionery industry is expected to grow in upcoming
future which indicates scope of development and expansion for Sweet Tooth. The industry
analysis, competitive analysis and other relevant evaluating factors helped in developing
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understanding about the viability and execution of this business idea. It can be expected that the
establishment of sweet tooth would be able to generate revenues and earn profits in the long run.
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References
Audretsch, D.B. and Moog, P., 2022. Democracy and entrepreneurship. Entrepreneurship
Theory and Practice, 46(2), pp.368-392.
Ratten, V. and Usmanij, P., 2021. Entrepreneurship education: Time for a change in research
direction?. The International Journal of Management Education, 19(1), p.100367.
Silva and et. al.,2020. Lean Startup, Agile Methodologies and Customer Development for
business model innovation: A systematic review and research agenda. International
Journal of Entrepreneurial Behavior & Research.
Li, W. and et. al.,, 2020. Evaluation of regional metafrontier total factor carbon emission
performance in China’s construction industry: analysis based on modified non-radial
directional distance function. Journal of Cleaner Production, 256, p.120425.
Trotter, and et. al., 2019. SuperSelfie Marketing Plan.
Chernev, A., 2020. The marketing plan handbook. Cerebellum Press.
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