Business Plan for Natural Bakery

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Bakery Business Plan Sample

Business Plan Introduction

Natural Bakery is a start-up business enterprise located in Melbourne, Australia. Natural Bakery (NB) is designed to satisfy the growing demand for natural products and ingredients among high-income consumers. The company plans to establish itself as a trustworthy provider of baked products while being supported by the favorable business climate in the industry and the customers’ willingness to purchase organic products.

History and Structure of Natural Bakery

NB is a partnership that is owned and managed equally by two partners. Mrs. Summia Nasser's family has extensive experience managing food and bakery businesses in both Australia and Saudi Arabia. Her experience in management and sales exceeds 2 years. Mrs. Joelissa Noel is invited to bring her knowledge of business administration, accounting, and finance, having experience working as a trainee accountant in a medium organization in Melbourne, Australia. Mrs. Summia Nasser leads a healthy lifestyle and seeks to teach her consumers how to live a healthy life without sacrificing the taste of premium baked products.

These skills and expertise are just enough to open and manage NB in Melbourne, Australia, but the company and its owners are going to obtain additional skills in the future. The company will perform all legal procedures to be registered officially, including registration with the Australian Tax Office and Consumer Affairs Victoria. These services are not provided in Melbourne, but online registration opportunities are available to all businesses nationally. Each partner will undergo additional training and certification to qualify for the position of a legal and professional partner at NB.

The choice of partnership is justified by the benefits it offers to any start-up. "The advantages of operating a business as a partnership are the ease of organization and dissolution, informality in management, and the lack of a partnership income tax" (Goldman 2010, p.461). In partnerships, all partners assume equal responsibility for management, while carrying unlimited liability for the debts or claims such business activity may incur (Business Victoria 2012). NB will operate based on a partnership agreement, which will facilitate the provision of quality services to customers while reducing the risks of conflicts if the partnership is dissolved.

NB offers a wide range of baked, coffee, and tea products for higher-income consumers. NB will achieve its strategic goals, by providing customers with high-quality baked products and pastry made of solely natural ingredients, coupled with personalized service and reasonable pricing. The company's competitive advantage grows from the use of only natural ingredients in baked products, as well as the absence of similar businesses in the area of the company's location.

NB expects that its sales will reach $210,000 in the first year and $385,000 in the second year. The strategic goal is to reach average sales of $590,000 by the third year. The strategy will be based on the regular analysis of customers’ taste preferences and perceptions, and the range of natural ingredients and products will be adjusted, based on customers’ responses and changing needs. In this way, the company will achieve a stronger alignment of its strategic goals and customer needs.

The partners of the new company have extensive experience managing various aspects of entrepreneurial and business activities. In addition, NB will invest considerable resources in hiring, training, and retaining its sales and service personnel. The company plans to invest $130,000 in personnel development and growth in the next three years. The financial side of business growth will bring together the capital owned by the partners and a five-year loan to make up the bulk of financing needed by the enterprise.

Marketing Analysis

Offered Products and Services

NB provides a complete range of bakery and pastry products, all being cooked of only natural ingredients. The popularity of these products is justified by the growing awareness of natural products and healthy choices in the Melbourne community. The affluent districts of Melbourne provide an abundance of eating opportunities, which are cheap but not always healthy. NB’s products will be inspired by the rich cultural and historical traditions of Melbourne’s diverse community while being informed by the needs and expectations of those who either live in the nearest district or seek colorful shopping experiences with David Jones.

Target Market and Consumers

According to FAO (2011), organic food is more expensive than traditional food products, mostly because their supply is limited. Moreover, greater labor inputs are required to produce a high-quality organic food product (FAO 2011). “Post-harvest handling of relatively small quantities of organic food results in higher costs because of the mandatory segregation of organic and conventional production” (FAO 2011). These are just some of the many reasons why NB will target high-income consumers coming to shop and live in the David Jones district in Melbourne.

Industry Analysis

The organic ingredients market in Australia enjoys sustained growth and opens new avenues for the development of organic business opportunities. In 2012, the total estimated value of organic supplies in Australia was $1.27 bn (Bez et al. 2012). In the coming years, the organic food market in Australia is projected to increase by 10-15 percent annually (Bez et al. 2012). The small production base does not allow reducing the costs and prices of organic products in Australia (Chang, Griffith & Zepeda 2003). Nevertheless, the bakery industry in Australia keeps flourishing.

The Australian baking industry remains highly fragmented while being extremely fractious and competitive (BRI Australia 2003). Most baking businesses are oriented at meeting the demands of the domestic market, with exports accounting for only 1.4 percent of total product turnover (BRI Australia 2003). The level of bakery goods’ consumption per capita remains static, and the gradual increase in the total turnover is attributed mainly to population growth (BRI Australia 2003).

Nevertheless, the organic food niche remains a serious void in the national baking industry, as traditional staples of bakeries make up almost three-fourths of all baked products consumed in Australia (BRI Australia 2003). One of the main organic bakery competitors in Melbourne is Natural Tucker Bakery that offers gluten-free cakes and vegan biscuit pies (Natural Tucker Bakery 2013). NB will enjoy a serious competitive advantage over Natural Tucker Bakery, by offering a more diverse range of food products for all consumer categories, while retaining its commitment to the use of natural ingredients in manufacturing.

Location

NB is located in Melbourne City, near David Jones, where thousands of high-income consumers come, looking for a pleasant shopping experience. David Jones and the neighboring area provide a variety of cheap eating options for higher-income consumers, but none of them uses natural ingredients for their products. Natural ingredients will become a point of distinction between NB and other food outlets located in the target area. High-income consumers will find it convenient to combine their shopping experiences at David Jones with a unique opportunity to taste wonderful bakery products based on natural ingredients.

Operations Analysis

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Management Structure and Procedures

The management team will consist of a Bakery Director and an Executive Manager. The latter will monitor and supervise the training and operational aspects of NB, while the Bakery Director will be responsible for marketing, business, and product development. Since the focus of NB is on the use of natural ingredients, the Bakery Director will also oversee and implement the most recent developments in the national organic food markets.

Hiring and Staff Requirements

The Executive Manager will be in charge of the staff baker trainers and trainees, who will be hired to participate in the company’s training program. Only those who pass the program successfully will have a chance to become members of NB’s staff. The training program will be organized for those, who experience major difficulties with employment but have enough talent, skills, and perseverance to provide high-quality responsible service to high-income consumers at NB.

The program will involve three men and three women, with or without any experience in the baking industry. In this sense, NB will also facilitate the community’s movement to sustainability, where all community members have decent employment and contribute to the community’s health and wellbeing through their productive work. Eventually, NB’s staff will include pastry bakers, baristas, and assistant personnel, with a total payroll reaching $154,000 by the end of the first year.

Production and Assets Required

NB will occupy the ground floor of any premise of the facility located in the near vicinity of David Jones. NB will be able to serve 35 customers at once. Little equipment will be used, due to the lack of automation in the baking and other food production processes. NB seeks to maintain an atmosphere of uniqueness and exclusivity; therefore, the main equipment items will include Hobart mixers and stoves.

Production and Service Process

NB will operate from 9 AM to 5 PM every day, including weekends. On weekends, NB will be open from 8 AM to 7 PM. The number of visitors on weekends is expected to be higher because many of them visit David Jones these days. Customers will place their orders and pay without walking to the counter. The Executive Manager will work every day, except for weekends. NB expects to serve at least 70 customers every hour. The approximate preparation time for an average lunch will not exceed 60 seconds. In the future, NB will supply salads and soups, also made of natural ingredients.

Business Plan Conclusion

Natural Bakery is created to catch up with the growing demand for natural ingredients and products. The enterprise will be located in an affluent neighborhood, where thousands of high-income consumers come to shop at David Jones. NB will operate on the principles of partnership, which provides considerable legal and operational benefits. The new bakery will greatly contribute to the health and economic/employment wellbeing of the target community.

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