Final Chelsey\'s Cupcake Cart Business Plan PDF

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Capstone paper - a full business plan....

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Student ID 837075 LaMunion Business Capstone Business plan page 1

Chelsey’s Cupcake Cart Business Plan Chelsey J. LaMunion Owner 5200 Town and Country Blvd Frisco, TX 75034 (214) 858-9562 [email protected] November 11, 2018

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A. Executive Summary...............................................................................................................4 A1. Company Identification.........................................................................................................4 A2. Mission of the Company.......................................................................................................4 A3. Business Goals......................................................................................................................4 A4. Keys to Success.....................................................................................................................4 B. Company Summary...............................................................................................................5 B1. Industry History.....................................................................................................................5 B2. Legal Form of Ownership.....................................................................................................5 B3. Location and Facilities..........................................................................................................5 B4. Management Structure...........................................................................................................5 B5. Products and Services............................................................................................................5 C. Market Analysis......................................................................................................................6 C1. Target Market........................................................................................................................6 C2. Industry Analysis..................................................................................................................6 C3. SWOT Analysis....................................................................................................................7 D. Market Strategy........................................................................................................................8 D1. 4Ps........................................................................................................................................8 D2. Price List..............................................................................................................................8 D3. Promotional Strategy............................................................................................................8 D4. Sales Forecast.......................................................................................................................8

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E. Implementation Strategy..........................................................................................................9 E1. Overall Strategy.....................................................................................................................9 E2. Monitoring Plan.....................................................................................................................9 F. Financial Statements and Projections....................................................................................10 F1. Forecasted Profit and Loss Statement..................................................................................10 F2. Forecasted Balance Sheet....................................................................................................10 G. Financial Report.....................................................................................................................11 G1. Financial Projections...........................................................................................................11 G2. Financial Position................................................................................................................11 G3. Estimated Capital/Investment Needs...................................................................................11

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A. Executive Summary Suggested length of 1–2 pages A1. Company Identification: Identify the company’s name and location. The name of the company is Chelsey’s Cupcake Cart. The cart will be a traveling food truck working in the northern portion of Dallas Fort Worth Metroplex. The official business location is the location of the bakery site, which is 2700 Preston Road Suite 371 Frisco, Texas 75034. A2. Mission of the Company: Describe the mission of the company. A3. Business Goals: Discuss two business goals in support of the company’s mission. A4. Keys to Success: Discuss three keys to success for the company.

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B. Company Summary Suggested length of 4–6 pages B1. Industry History: Describe the history of the industry in which the company will operate. Cupcakes are a staple at almost every birthday party in the United States today, but they were not always the celebratory dessert item we take for granted today. Cupcakes belong to a revolution of the baking industry and home cooks adapting recipes over the generations. Baking, in general, has been around for centuries. The original form of baked goods were simple breads that were a staple of diets dating back to Egyptian times. Bread has been seen as a cornerstone to many different ethnic groups. There are even laws dictating bread making including one called the Assize of Bread and Ale of 1266. The law dictated many features of bread including the size it should be to be sold in England for over 800 years until it was altered slightly in 2008 (H. Wallop, Telegraphy). Cake, as Americans know today, is nothing like those first baked goods that history referred to as cakes. The modern cake of today most likely has evolved from bread baking in the European areas. Before the American revolution of baked goods that use baking powder, three types of cakes were popular: yeast, sponge, and pound (Civitello, Baking Powder Wars,16) The earliest cakes were made from bread dough that was sweetened and studded with fruit (Food History Almanac – page 25). When thinking of cake in the traditional term of the word a fruitcake would be the best comparison of original cakes. Fruitcakes are dense, full of nuts and fruit, and palatable to some, brick-like to others. After chemists created baking powder as a light and easy leavening agent and baking soda became popular a cake revolution began. Housewives all over the United States and eventually Western Europe were free to explore and create delicious cakes that were light, fluffy and sweet. They were able to make amazing sweets without the back-breaking work of making home-made yeast that was incredibly hard to make

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and turned baked goods into firm bitter baked goods. As time went on cakes became a staple at celebrations including birthdays. At some point, that is widely disputed, families wanted the deliciousness of cake but with more portability and flexibility of flavors. Many attribute the crazy of cupcakes to a 2000 episode of a famous HBO show which showed an episode of it’s leading ladies eating cupcakes outside of a trending New York City bakery (BUSINESS INSIDER) Although some see cupcakes a fading fad, the craze seems to have a steady following that many companies see as lucrative. In the eighteen years since that fated episode premiered cupcakes have become a mainstay at birthday parties and even weddings. Cupcake stores are opening across the country daily, they are featured with reality shows and competitions on channels like the Food Network, and the Cooking Channel daily. They may have been a trend when the popped up on the scene, but they seem to have a sticking power that unicorn shakes don’t have. B2. Legal Form of Ownership: Chelsey’s Cupcake Cart will be a Limited Liability Company (LLC). The reason for this is the liability and tax advantages. The LLC will allow the company to be seen as more legitimate to other businesses and protects the owner’s personal assets against liability claims. It is also helpful because an LLC allows the owner to file taxes like a sole proprietor or a corporation, whichever is more advantageous. B3. Location and Facilities: The cupcake cart will consist of two facilities. A commercial baking space that has coshare capabilities will be rented in Frisco, TX at 2700 Preston Road Suite 371 Frisco, TX 75034. The baking area has a square footage of 2400 square feet that can be rented for specific days and

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times, in a type of timeshare system. The baking space will have four commercial convection ovens as well as three ranges with six burners per range. The property has a subzero freezer with a capacity of 200 square feet and two commercial refrigerators with a size of 100 square feet per refrigerator. There is a total of 900 square feet of storage space with industrial shelving to store all baking supplies and equipment. The facility already has a fixed foot establishment permit in place. The second facility is a food truck with a 100 square foot capacity. It has 25000 miles on the vehicle and is a Ford commercial van with one serving window. It has room for two people serving in the back and has seats for two people when the vehicle is in motion. The vehicle will be stationed at the baking space on Preston road during closed hours and will roam the northern sections of the Dallas / Fort Worth Metroplex during open hours. The central locations of sales will be at the Frisco Main Street area, Granite Park area of Plano, and Arbor Hills Nature Preserve in Plano, along with local farmers markets on specific dates. The truck will also be available for private events within fifty miles of the metroplex by request. The truck requires a Mobile Food Unit permit that has been obtained from the State of Texas. B4. Management Structure: The Cupcake Cart will have three employees in total. Chelsey LaMunion will be in charge of Management, Human Resources, Marketing, Operations, and Finance. Two additional employees will also be in charge of certain portions of operations. A lawyer and accountant are subcontracted on retainer for times when they are needed. The lawyer on retainer will be the one that is responsible for any permit paperwork as well as litigation issues and employee contract creation. The Accountant on retainer will be accountable for quarterly tax filings as well as yearly financial documentation creation. Chelsey will have the following tasks as the only person

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over management of the company. As the only member of the management team, she will be in charge of making all business decisions regarding the location of the business as well as any decisions related to sales or business needs. Chelsey will also be in charge of monitoring all other employees. Human resources tasks also fall under the purview of Chelsey; those tasks include hiring new employees, monitoring employee actions, benefits arraignments, and bi-weekly payroll. Marketing tasks include business signage, marketing campaigns, and advertisements, as well as social media posts; those decisions will be made by Chelsey. Design work may be contracted out on an as-needed basis. Chelsey will also be in charge of all financial decisions including the amount of inventory needed, type of investments required, purchasing equipment, and securing funding for any endeavors. Operations tasks manned by Chelsey will be assigning work hours to other employees, creating recipes, testing all menu offerings, baking goods, and deciding where to set up the food truck daily. Two additional employees will be hired for assisting with the operation as well. Those employees will be in charge of baking goods based on well-defined recipes, decorating the baked goods, and selling the items to the public from the truck. The additional employees will also be in charge of serving during private events. This list is not exhaustive, any significant decisions regarding business matters will be addressed with Chelsey. B5. Products and Services: Describe the products and services offered by the company. Chelsey’s Cupcake Cart will be offering a gourmet personalized cupcake experience to customers. There will initially be five different cupcake flavors offered. Those include Vanilla bean, Red Velvet, Triple Chocolate, Spice, and Lemon. Along with those five cake flavors five frosting flavors will be provided. The frosting flavors included will be Milk Chocolate Ganache,

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Vanilla Bean Buttercream, Cinnamon Vanilla Cream Cheese Frosting, Dark Chocolate Buttercream, and Orange Vanilla Buttercream. The cupcake cart will initially offer three filling options of apricot curd, peanut butter ganache, and raspberry coulis. Toppings initially offered to customers will include 4 Mars© candy bar varieties, crushed Oreo© cookies, and fresh fruit options that will vary depending on availability. The idea behind the cupcake cart is to offer the customer a customized experience by allowing them to choose a cake flavor and then customize the toppings, fillings, and frostings as they wish. They will be able to determine the exact taste of their personalized dessert and then watch it made to order. The only pre-assembled items will be the cake flavors will already be baked, and the frosting and filling options will be pre-mixed at the baking facility.

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C. Market Analysis Suggested length of 3–5 pages C1. Target Market: The target market for Chelsey’s Cupcake Cart is families and young professionals. The company’s products are moderately priced so that it will focus on those in the middle-income class making between 35,000 and 75,000 per year. Young professionals would be men and women between the ages of 22-35. Middle-income families will be classified as families with children ranging from 5-17 years old. This range is adequate for the cupcake cart which will focus on a child-friendly food item, cupcakes while offering certain upscale amenities that lowincome members may not be able to afford. The range of the cupcake cart is within fifty miles of the Dallas/Fort Worth area for catering events and within twenty-five miles of the Frisco area for daily business deals. Our target market for catering will be small and medium-sized companies with events ranging from 100-500 people. C2. Industry Analysis: Complete an industry analysis for the company, including current trends and statistics. The baking industry is robust and full of competition. A 2016 article on bakingbusiness.com indicates a growth rate of 7.2% for cupcakes alone in the past five years. Cupcakes have a growth rate of 5% or more from 2015 to 2016 (BAKINGBUSINESS.COM). $30 billion in revenue is generating by the baking industry each year. That revenue is made by 6,000 retail bakeries and almost 3,000 commercial bakeries across the country. Over half of the revenue is generated by through huge producers. Retail bakeries and commercial bakeries create 34 billion in revenue. Cakes make up 15% of the bakery market. (CITATION – CHRON). The retail bakery market relies heavily on user input in regards to trends and new offerings. A significant pattern in the bakery section that will continue into 2019 is the small confection trend. Mini pies, cake pops, cupcakes, and little pastries are a huge trend currently, as they offer consumers to the

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option to portion control while still indulging in a treat. New chocolate by Barry Callebaut is starting to make waves in the dessert industries and is shaping up to burst on to the retail scene with fervor in the year 2019 (SNACKANDBAKERY.COM). Customers are still trending to wanting transparency and natural ingredients in their foods. The trend of alternative natural sugars and allergy aware brands is still on the radar for 2019 as well.

C3. SWOT Analysis: Complete a four-square SWOT analysis for the company in which you do the following: a. Identify three strengths, three weaknesses, three opportunities, and three threats. Utilize the four-square template below to identify and explain the strengths, weaknesses, opportunities, and threats for your company.

S (Strengths)

W (Weaknesses)

1. Previous Business Experience

1.No previous restaurant experience

2. Quality Recipes

2. Low financial funds

3. Unique Offerings

3. Low amount of staff

O (Opportunities)

T (Threats)

1.Free advertisement offer through the

1. Saturated bakery market

Frisco Chamber of Commerce

2. Government regulation changes

2. New Farmer Market opening in Little

3. Fluctuation of perishable food prices

Elm 3. Small business loan incentive in Frisco

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b. Explain each of the identified strengths, weaknesses, opportunities, and threats. Chelsey’s Cupcake Cart has been in the making for several years, and SWOT analysis is the best way for the company to formulate a strategic plan. Three strengths are apparent to the Cupcake Cart. The owner of the company has previous business experience. A small business can be stressful. The fact that Chelsey has previous experience running a small business is going to be extremely beneficial in the long run. Knowing the legal side of taxes, human resources, and marketing is a huge benefit to the company. It allows the company to prosper and prevent small missteps that a novice business owner may fall victim to. The second strength for the cupcake cart is the tried and true baking recipes that Chelsey owns. These recipes come from her family who has a history in the baking industry in other areas of the country. The recipes are known favorites to the general public in every area they have been utilized so the product quality and flavor is solid. The final strength of the Cupcake Cart is the unique service this cart provides. Almost all other cupcake bakeries and food trucks offer a pre-selected menu of pre-assembled cupcakes. The fact that the cart will allow someone to pick and choose every flavor that goes into their cupcake is essential to the success of the company. This business model allows the company to differentiate itself from the pack. The cupcake cart also has a few internal weaknesses that need to be monitored and addressed if possible. The first weakness is Chelsey’s lack of restaurant experience. Although she is an avid baker with family recipes and has run a small business in the past, she does not have any experience as an owner of a restaurant or food company. This can put the company at a disadvantage when it comes to creating supply contracts and understanding small pitfalls that could be avoided with a more experienced owner. The second weakness is the low amount of financial funds to start the company with. The company has secured a business loan for 50,000

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dollars, and the owner has saved 30,000 dollars to invest in the company. This is a substantial amount to start with but if unforeseeable circumstances occur it could be difficult for the company to overcome them without stronger financial backing....