BUSINESS PLAN ON CONFECTIONARY

FOR BAKE AND ICE

BY

Theodore Skuan

BEING AN APPLICATION FOR A LOAN

DECEMBER, 2019

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1.0 Executive Summary

Bake and Ice is an existing enterprise that carries out baking of cakes,
production of pastries and training of students in the art of
confectionary. The society is need of our products as the cake is very
significant and symbolic in celebrations and celebrations happen on a
daily basis. The pastries too are on very demand because they are
consumed all classes of people and are very flexible both in handling
and consumption, hence are easy to work with.
The business targets couples preparing for weddings, individuals and
groups preparing for different classes of celebrations as well as parents
with kids who need pastries for in-between meals. We also target young
school leavers who are desirous of acquiring a skill to be independent
and earn a living with. Our competition in the market is the likes of Tre
and Stace Cakes and Cake Buds by Maudlyn who are very popular in
the business. Other competitors are the big companies producing
biscuits and snacks which are established in the market. However, we
pride ourselves as an indigenous enterprise using local materials in our
production and operating at the interior locations in the town to capture
the untapped market.
Since the business is already in operation, it requesting a loan of Two
Million Dollars ($2,000,000) only to sustain operations. An analysis of
the business shows there is a high prospect for profitability because
consumption of cakes and pastry is constant. The business estimates an
annual profit of Five Hundred Thousand Naira ($500,000) which is
enough to repay the loan over the period of five (5) years.

2.0 Background Information

Bake and Ice has over five years experience in confectionary making
and training. The business explores to both the scientific and
conventional methods of cake and small chops production. The
enterprise is an idea of the promoter of the business who after careful
thought, observation and interaction was convinced that there is a need
for these foods to be made available to the ever growing market.
Innovation and technology are applied in the areas of packaging and
processing to preserve them from damage and guarantee their content is
not comprised until they are consumed.

The raw materials are all locally sourced so as to promote local content.
That is the reason why the processing equipment as far as possible are
purchased from local vendors.

There is guaranteed expertise because the promoter of the business is

an experienced hand in the field. She also has practical experience on
the procedures of food processing, packaging and sales. We have

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 mastered the technical requirements, financial management, staff
recruitment and organizational skills among other things necessary to
give the firm good commendation from our clients.

Our managerial skills have also helped in putting together a workforce

over time, which will also help the management to coordinate the team
work in most aspects of the business venture.

Mr Theodore Skuan is the CEO of the business overseeing the day to day
activities of the business. She has been baking for almost a decade and
understands the intricacies of baking, the experience she uses to run
the enterprise and train the students to perfect in the art. She is highly
experienced in the management of personnel and finances.

Vision Statement

To be the most reliable emerging producer of cakes and pastries as well

as produce capable hands to replicate same as well as offer excellent
sales services.

Mission Statement

To offer the most qualitative and dependable supply of confectionery

riding on a culture of continuous improvement in our standards in a
manner that consistently exceeds customer expectations.

Business Goals
Our goal is achieved through the production of high quality cakes and
pastries food for healthy consumption and also to create opportunities
for employment and wealth creation.

Promoters profiling
Mr Theodore Skuan is a graduate of Animal Nutrition from the
University of Agriculture, Michigan is the major promoter of the
business. Since the venture is her project, she has the command to drive
it to the latter and is assured of getting the conviction of her target
market.
She has undergone an Entrepreneurship Development Training
Michigan State Skills Centre which will also facilitate in promoting her
products.
Supporting in the promotion of the business are her friends and
colleagues in the print and electronic media, hotels, restaurants and
food selling outlets who patronize her venture as well as some local
media hubs.

3.0 Management/Personnel Plan

Mr Theodore Skuan is the Chief Executive officer (CEO). She is

responsible for making strategic decisions for the venture. Other
personnel include two staff who also carry out the catering services as
well as coaching of the students in the academy. The students who are
admitted in a class of ten (10) for a period of six (6) months also serve as
support staff in the enterprise.
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4.0 Product and Services

The following are the products we sell:

 Wedding and Birthday cakes

 Cakes for other special occasions
 Meat pie
 Doughbut
 Chin-Chin
 Training classes for catering services

5.0 Marketing Plan

Our Competitive Advantage
Bake and Ice is fully aware that there is competition when it comes to,
which is why we decided to carry out thorough market research so as to
know how to take advantage of the available market in Michigan State in
general and Michican in particular.
We have done our homework and we have been able to highlight some
factors that will give us competitive advantage in the marketplace. Our
research factors are effective and reliable for food production processes
that can help us sell our products at competitive prices, good network
and excellent relationship management.
We purchase the best specie/variety of corn, millet, sorghum, acha,
finger millet, soyabeans and groundnuts.
Besides our relationship (network) and equipment, we can confidently
boast that we have the most experienced hands from Department of
Food Science and Technology, University of Agriculture Makurdi as
consultants who always have an eye on oue production processes.
Lastly, all our employees are well taken care of, and their welfare
package is among the best within our category in the industry.

Market Strategy

Bake and Ice will adopt the following strategies in marketing our
commercial farm produce;

 Introduce our business by sending introductory letters alongside

our brochure to stakeholders in the agriculture industry,
households, hotels and restaurants and agriculture produce
merchants.
 Target hospital departments for patients with special diet needs so
as to establish contacts with them and supply for them always
 Advertise our business in agriculture and food related magazines
and websites
 Attend related agriculture and food expos, seminars, and business
fairs

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  Leverage on the internet to promote our business
 Engage in direct marketing
 Encourage the use of word of mouth marketing (referrals)

Our Pricing Strategy

We are quite aware that one of the easiest means of penetrating the
market and acquiring loads of customers for all our products is to sell
them at competitive prices, hence we will do all we can to ensure that
the prices of our products are going to be what other food processors
would look towards beating.

6.0 SWOT Analysis

Strength:

Our strength lies in our on-hand experience in the business spanning

for several years. Furthermore, our proximity to the metropolis with a
high population of aged people with special diet needs.

In addition, the location of our plant is that, we are at the gateway into
the city and are in pole position to access the raw materials directly from
the farmers immediately after cultivation, thereby minimizing the risk of
contamination by chemicals used in preservation.

Weaknesses:

Our weaknesses are not permanent setbacks, but focal points that
constantly nudge us on to plan and strive towards set milestones. Hence
the fact that relatively limited finance that can drive expansion is
topmost challenge does not deter our resolve to look fervently inward for
practical solutions to such critical challenges.

Opportunity:

Food is a necessity for man. This is the fundamental pointer to the fact
that there is always a market for us and considering that there has been
an improved level of education amongst the people, a lot are more
conscious and careful of what they consume and will jump at the
opportunity of buying our products.

Opportunities abound in our direction if we stand up to take advantage

and such include a relatively cheap and available work force; a relatively
unmet demand for our line of products in the Benue market place and
the total absence of a passionate business dedicated to refining of the
products that we plan to offer our variety of clients.

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 Threats:

Like in any business venture, there are areas that pose serious threats
to our business venture from our analysis.
These includes:
 The incessant attacks on farmlands by herdsmen which greatly
reduces the amount of yield from the farms.
 The raw materials are only available during harvest due to the
Seasonal cultivation of crops since irrigation farming is not very
commonly practiced in this vicinity, thereby restricting the
quantity of grains, cereals and nuts that would have been
available.
 Fear of grains been damaged by trying as much as possible to
use only natural means of preservation

7.0 Financial Plan

CAPITAL COST

S/No ITEM QUANTITY AMOUNT

1 SDG 7000SE GENERATOR 1 300,000
2 2 DECK 4 TRAY BONNET Hgo24 BAKING OVEN 1 530,000
3 B1OK 1OLITRE MIXER 1 150,000
4 POLYSTAR GAS COOKER 1 155,000
SUB-TOTAL 1,135,000

WORKING COSTS
S/No ITEM QUANTITY UNIT COST AMOUNT
1 GOLDEN PENNY FLOUR 15 BAGS 11,500 172,500
2 LOYALMILK 2 BAGS 35,000 70,000
3 SUGAR 5 BAGS 14,000 70,000
4 BAKER’S CHOICE ICING SUGAR 4 BAGS 11,500 46,000
5 SHOP RENT 1X2YRS 120,000 240,000
6 SIGN BOARD 1 25,000 25,000
7 FLYERS & HANDBILLS LUMP 10,000
8 STAFF SALARIES FOR 6 MONTHS 2 15,000 180,000
9 MISCELLANEOUS 51,500
SUB-TOTAL 865,000
TOTAL 2,000,000

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PROJECTED YEARLY SALES
S/N ITEM UNIT QUANTITY ($) Total sum ($)
PRICE (N)
Year 1 Average Sale of 30,000 50 1,500,000
cakes
Sale of Pastries 1,000 100 100,000

Earnings from 20,000 20 Students 400,000

Trainings
Year 2 Average Sale of 30,000 60 1,800,000
cakes and chops
Sale of Pastries 1,000 100 100,000

Earnings from 20,000 20 Students 400,000

Trainings

Year 3 Average Sale of 30,000 60 1,800,000

cakes
Sale of Pastries 1,000 100 100,000

Earnings from 20,000 20 400,000

Trainings Students

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PROFIT AND LOSS ANALYSIS

Particulars Year 1 ($) Year 2 ($) Year 3 ($)

Expected sales 2,000,000 2,300,000 2,300,000
Less 1% - 23,000 23,000
discount
Net sales 2,000,000 2,277,000 2,277,000
Expenses
Capital costs 1,1350,000 Nil Nil
Direct costs 865,000 400,000 400,000
Indirect costs - 300,000 300,000
Loan Nil 436,000 436,000
Repayment
Total 2,000,000 1,136,000 1,136,000
expenses
Profit before 0 1,141,000 1,141,000
tax
Profit after tax 0 1,026,900 1,026,900
Less 10% tax 114,100 114,100

NB: At the interest rate of 9%, the loan repayment amount is Four Hundred
and Thirty-Six Thousand Naira (N436,000).
Also note that the above estimations are very modest hence, the business will
repay the loan conveniently.

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8.0 Regulation
The venture ensures that the employees and students adhere strictly to
regulations, standard aprons are worn, prompt timing and resumption
to duties is be observe and good business ethics conducted.

9.0 Tax

 The venture shall also collect and pay tax of the individual
employees working in enterprise as at when due.

10.0 Exit Plan

Bake and Ice will liquidate upon exiting the business