Post on 24-Dec-2015
transcript
Business PlanBusiness Plan
Prepared By:
Amanda Hoehn
Jeremy Olthof
Leigh Anderson
Glenn Stacey
AgEc 495.3 College of Agriculture AgEc 495.3 College of Agriculture and Bioresourcesand Bioresources
IntroductionIntroduction
The feasibility of The feasibility of moving a packaged moving a packaged fudge bar into the fudge bar into the premium retail market premium retail market
Primary target market Primary target market will be Western Canadawill be Western Canada
AgEc 495.3 College of Agriculture AgEc 495.3 College of Agriculture and Bioresourcesand Bioresources
Site LayoutSite Layout
AgEc 495.3 College of Agriculture AgEc 495.3 College of Agriculture and Bioresourcesand Bioresources
Goals of BusinessGoals of Business
Short TermShort Term Western CanadaWestern Canada Retail marketRetail market
Packaging and selling of:Packaging and selling of: 12 regular flavours 12 regular flavours 2 sucrose free flavours2 sucrose free flavours
Long TermLong Term Expand to the rest of Expand to the rest of
Canada Canada Relocate to a larger Relocate to a larger
facilityfacility
AgEc 495.3 College of Agriculture AgEc 495.3 College of Agriculture and Bioresourcesand Bioresources
Fudge ProcessFudge Process
RawIngredients A
FudgeVat B
Fudge Pan
C Scoring
H
Packaging
G
Heat Sealing
D
Labeling
F
Display Case Master Case
CuttingE
I
AgEc 495.3 College of Agriculture AgEc 495.3 College of Agriculture and Bioresourcesand Bioresources
Inventories, AR and APInventories, AR and AP
InventoriesInventories 12 days12 days
FIFOFIFO
Accounts ReceivableAccounts Receivable 12 days12 days
Consignment and PharmaChoiceConsignment and PharmaChoice®®
Customer pay by credit card at gift Customer pay by credit card at gift shows shows
Accounts Payable Accounts Payable 10 days10 days
New York supplier - 2/10 n/45New York supplier - 2/10 n/45 Harlan Fairbanks - 2/10 n/30Harlan Fairbanks - 2/10 n/30
AgEc 495.3 College of Agriculture AgEc 495.3 College of Agriculture and Bioresourcesand Bioresources
Capital BudgetCapital Budget
ValuePurchased Assets
Heat Sealer 7,500$ Printer 10,000$ Computer 3,200$ Blackberry™ 400$
Current AssetsFudge Pots 10,000$ Fridge and Freezer 500$ Miscellaneous Equipment 5,000$ Total Equipment Costs 36,600$ Total Working Capital 7,521$ Total Capital Required 44,121$
AgEc 495.3 College of Agriculture AgEc 495.3 College of Agriculture and Bioresourcesand Bioresources
Organizational Structure: Board Organizational Structure: Board of Directorsof Directors
Board of Directors (2)
Sales Representative
Factory Staff
President/General Manager Co-Manager
AgEc 495.3 College of Agriculture AgEc 495.3 College of Agriculture and Bioresourcesand Bioresources
Human ResourcesHuman Resources
CurrentlyCurrently President/General ManagerPresident/General Manager Co-ManagerCo-Manager Fudge ChefFudge Chef Fudge WorkersFudge Workers
AdditionsAdditions Sales RepresentativeSales Representative Fudge WorkersFudge Workers
AgEc 495.3 College of Agriculture AgEc 495.3 College of Agriculture and Bioresourcesand Bioresources
ProductProduct
80g premium fudge bar80g premium fudge bar 4 x 2 package4 x 2 package 12 regular flavours and 2 12 regular flavours and 2
sucrose freesucrose free Wrapped in a glossy packageWrapped in a glossy package
WeightWeight FlavourFlavour IngredientsIngredients Best before dateBest before date Nutritional informationNutritional information
RegularPumpkin Pie
Heavenly GooChocolateMaple Nut
English ToffeeChocolate Peanut Butter Swirl
Summer TortoiseCaramel Pecan
Chocolate Amaretto SwirlChocolate Mint SwirlCookies and Cream
Sucrose-freeChocolateMaple-Nut
Varieties
AgEc 495.3 College of Agriculture AgEc 495.3 College of Agriculture and Bioresourcesand Bioresources
PricePrice
Wholesale $2.59Wholesale $2.59 Retail and consignment $3.99Retail and consignment $3.99 Both premium and competitive pricing strategyBoth premium and competitive pricing strategy FF will be the only providers of fudge to the retail FF will be the only providers of fudge to the retail
marketmarket
AgEc 495.3 College of Agriculture AgEc 495.3 College of Agriculture and Bioresourcesand Bioresources
PromotionPromotion
Gift showsGift shows ““Fudge Program”Fudge Program” Retail display rackRetail display rack WebsiteWebsite Pamphlets and signsPamphlets and signs
AgEc 495.3 College of Agriculture AgEc 495.3 College of Agriculture and Bioresourcesand Bioresources
PlacePlace
Gift shopsGift shops 24 PharmaChoice24 PharmaChoice®® stores stores SaskMade MarketplaceSaskMade Marketplace®®
Shipped by private courier Shipped by private courier Contacted via gift showsContacted via gift shows
http://www.pharmachoice.com/images/front-logo.gif
http://www.sfpa.sk.ca/img/programs_market_saskmade.gif
AgEc 495.3 College of Agriculture AgEc 495.3 College of Agriculture and Bioresourcesand Bioresources
SWOT: StrengthsSWOT: Strengths
Human ResourcesHuman Resources Ease of communication with staff Ease of communication with staff Excellent knowledge base of fudge industryExcellent knowledge base of fudge industry Commissioned sales personal Commissioned sales personal
Physical ResourcesPhysical Resources Low capital investment Low capital investment Leasing the buildingLeasing the building
Financial ResourcesFinancial Resources Just in time inventory turnoverJust in time inventory turnover Line of credit available in case of low cash flowLine of credit available in case of low cash flow
AgEc 495.3 College of Agriculture AgEc 495.3 College of Agriculture and Bioresourcesand Bioresources
SWOT: WeaknessesSWOT: Weaknesses
Human ResourcesHuman Resources Executive and Sales Rep. have overlapping positions Executive and Sales Rep. have overlapping positions Consistency of product and packagingConsistency of product and packaging
Physical ResourcesPhysical Resources Low capital investment Low capital investment Limited expansion potential with a leased buildingLimited expansion potential with a leased building Product has to be set at a certain temperatureProduct has to be set at a certain temperature
Financial ResourcesFinancial Resources No accounts receivable at gift showsNo accounts receivable at gift shows
AgEc 495.3 College of Agriculture AgEc 495.3 College of Agriculture and Bioresourcesand Bioresources
SWOT: Opportunities and SWOT: Opportunities and ThreatsThreats
OpportunitiesOpportunities Provide an alternative to chocolate – niche marketProvide an alternative to chocolate – niche market Other retailers can follow the gift stores, PharmaChoice, Other retailers can follow the gift stores, PharmaChoice,
SaskMade Marketplace SaskMade Marketplace Sucrose free product to diabetics and dietersSucrose free product to diabetics and dieters
ThreatsThreats No barriers to entry for competitionNo barriers to entry for competition Healthier consumption choicesHealthier consumption choices
AgEc 495.3 College of Agriculture AgEc 495.3 College of Agriculture and Bioresourcesand Bioresources
CompetitionCompetition
Cote D’orCote D’or®®
PoulainPoulain®®
LindtLindt®®
Bernard CallebautBernard Callebaut®®
Laura SecordLaura Secord®®
CadburyCadbury®®
HershyHershy®®
AgEc 495.3 College of Agriculture AgEc 495.3 College of Agriculture and Bioresourcesand Bioresources
Balance Sheet Balance Sheet
Assets LiabilitiesCurrent Assets: Current Liabilities:Cash 4,996 Accounts Payable 9,180 Accounts Receivable 9,367 Total Inventories 7,335 Long-Term Liabilities:
Total Current Assets 21,697 Long Term Debt -
Long-Term Assets: Total Liabilities 9,180 Buildings, Machinery & Equipment 18,400 Accumulated C.C.A (13,725) Owner Equity
Total Long-Term Assets 4,675 Owner Equity 50,000 Retained Earnings (32,808) Total Owner Equity 17,192
Total Assets 26,372 Total Liabilities & Owner Equity 26,372
Chocolate Moose Fudge Factory Balance Sheet
as at August 31, 2007
AgEc 495.3 College of Agriculture AgEc 495.3 College of Agriculture and Bioresourcesand Bioresources
Year 2007 2008 2009 2010 2011Sales 110,000 132,000 158,400 190,080 228,096 COGS 300,982$ 291,367$ 359,676$ 410,493$ 491,786$
Gross Margin (16,082)$ 57,350$ 67,154$ 111,947$ 147,681$
Expenses 66,725$ 65,024$ 66,853$ 71,019$ 71,197$
Income b/f Taxes (82,808)$ (7,674)$ 301$ 40,928$ 76,483$
Income Tax -$ -$ -$ -$ 2,723$ Net Income (82,808)$ (7,674)$ 301$ 40,928$ 73,760$
Beg. Retained Earnings
50,000$ (32,808)$ (40,482)$ (40,181)$ 747$
Dividends -$ -$ -$ -$ -$
End. Retained Earnings
(32,808)$ (40,482)$ (40,181)$ 747$ 74,508$ Ending Cash 4,996$ 4,002$ 4,805$ 44,584$ 115,674$
$137,172Internal Rate of Return on Equity InvestmentExternal Rate of Return on Equity Investment
Net Present Value (NPV)38.63%33.32%
Statement of Financial ResultsStatement of Financial Results
AgEc 495.3 College of Agriculture AgEc 495.3 College of Agriculture and Bioresourcesand Bioresources
FinancialsFinancials
Sensitivity of Net Present Value: Price and Sales
$(15,262)
$(159,253)
$137,172
$297,213
$466,268
-10%
-5%
0 (Base)
5%
10%
Percen
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NPV
AgEc 495.3 College of Agriculture AgEc 495.3 College of Agriculture and Bioresourcesand Bioresources
FinancialsFinancials
Sensitivity of Internal Rate of Return: Price and Sales
18.0%
38.6%
61.6%
88.7%
-3.6%-10%
-5%
0 (Base)
5%
10%
Percen
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IRR
AgEc 495.3 College of Agriculture AgEc 495.3 College of Agriculture and Bioresourcesand Bioresources
Questions ?Questions ?
www.fudgefix.com