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Name and Contact details of client: Edit

Montombi Kunene

12 Nick Circle Kwanonqaba Mossel Bay

Cell: 072 904 6809 / 044 693 4108

Description of the business Edit

What exactly is it that is going to be sold or done?

Baking of my own biscuits and muffins.

What skills are needed to do this? Where is this taught and how much will it cost?

You would need baking experience and I have the necessary experience.

What tools or equipment are needed? Where can they be bought, and how much will they cost?

  • stove
  • Baking pans

They are already at home no costs. I need:

  • 2 x extra baking pans R150.00
  • 1 week supply of raw material (four, ect.) R250.00
  • Packaging of products R75.00
  • Transport R25.00
  • Electricity R100.00

How much space is needed to work from?

The work will be done in a normal size kitchen.

Where will the space be found, and how much will it cost to rent?

At home:

  • No rent
  • Electricity R100.00

What sort of people will buy the product? Who are they and where do they live? All sort of people from the community and the area, for example:

  • People who are working
  • Pensioners
  • Students and teachers
  • Taxi drivers

How much and how often will they buy? Will they come to the shop or will it be necessary to deliver?

Weekly, monthly, I will deliver my products to them.


Upstream Businesses Edit

A list of businesses and ideas that provide the services and products that this business needs.

  • Makiva
  • Checkers
  • Lloyds


Downstream Businesses Edit

A list of businesses and ideas that this business could provide products for.

  • Small businesses
  • Open market, fleamarkets
  • Private persons
  • Bakeries


Competitors Edit

What major competitors will attract clients' spending away from the business products?

I know of one lady selling from the municipality offices for the workers.

What prices and products do these companies have?

  • Biscuits R20.00 packet (½ kg)
  • Rusks R20.00 packet (½ kg)

What makes them popular / unpopular?

People know her and like her products.

What do they do to attract customers? Specials? Interesting marketing / advertising?

Her packets looks nice.

Which of the competitors stand out as being particularly good at what they do?

The lady who is selling for the municipality workers.

What can be done to stand out against them? What can be done that is more exciting / more interesting?

Making different types of biscuits and more effective packaging and marketing.


Marketing the business to clients Edit

What sort of people will buy the products and how important is product consistency to them (e.g. must every loaf of bread be identical)?

  • Working people
  • teachers
  • students
  • pensioners

I would do the delivering.

How seasonal or fashion-dependent are their buying habits (do they buy only in summer, only over Christmas, etc.)?

Not seasonal, daily based.

Do the clients want the products to be the cheapest or the best (low price / low quality or high price / high quality)?

The best, high price for high quality

How do the clients decide where to buy the products? What sorts of advertising / promotions attract their interest?

Advertisement and product satisfaction would attract more customers and marketing.

Do the clients want the same things sold in the same way, or do they want things to change all the time?

No, Some products but the packaging can change.

What can be done to attract the first clients (the most important and most difficult to get)? How much will it cost?

Specials and give aways.

What will the business be called? Why?

Mantombi's Bakery. It will be my bakery.


The business inputs and outputs Edit

List all of the inputs (products that are required to produce the products):

Stove, baking pan, electricity and ingredients.

List all the suppliers for the inputs and their addresses, telephone numbers, and sales terms (cash, 30 days, etc.):

Checkers and Makiva

List all of your outputs (products created by your business):

Biscuits, rusks and muffins

What sort of prices can be charged and how much profit will can be made on each item (a rough estimate)?

One pack of biscuits 1kg: R30 Profit: R10 Rusks: selling price: R30 p/kg ; cost: R10 - R15  ; Profit: R15.00 Biscuits: selling price: R30 p/kg; cost: R10 - R15 ; Profit: R15.00 Muffins: selling price: R30 p/kg; cost: R10 - R15 ; Profit: R15.00

Do the outputs have a shelf life? Must they be sold within a specified time limit before they go off / can't be sold? Which ones?

Yes, I make the products based on the orders of the clients and if not sold in a sertain timeframe the products can go stale.


Setting up the business Edit

List everything that needs to be done to prepare the business to be ready (list everything needed to have as well, both equipment and stock):

Ingredients, Stove, baking pans, electricity etc.

How long will it take to get all of these things and how much will they cost to get?

Only a day because I have a stove and the pans, ingredients an electricity.

  • Pans R150 (once off)
  • Electricity R100
  • Four, etc. R250 (This will only be enough for one week)
  • Packaging R100
  • Transport R75
  • Other R100
  • Marketing R200

Total: R975.00

List all the fixed costs to be paid every month even if nothing is sold (things like rent, electricity, telephone, staff wages):

  • Rent R150
  • Electricity R100
  • Telephone R120
  • Staff wages R300
  • Also see cash flow on pages 19 and 21

Total amount for fixed costs: R670

How many staff will be needed and how much will each of them be paid (wages must be included in the fixed costs above)?

Only once I am up and running I will employ two people, R150 each p/week and they will also earn commission.

What training will they need, how long will it take and how much will it cost?

They already know how to bake so no training is necessary.


The manufacturing or production process Edit

What possible problems may happen during each step of the manufacturing process?

Stove bulb could fuse during baking process then you won't be able to see what's happening inside. The baking prosess can "flop", ect. Run out of electricity or area mains failure (Eskom shut-down)

What solutions can be identified for these problems? How much will they cost and how long will they take to fix?

By changing the bulb, it would cost me R3,99 and take a second to replace it. Make sure the ingrediance is mixed according the recipies. Make sure there is always electricity supply. Do quality control to make sure the baking is done "to-the-end".

What is the maintenance program for all the equipment?

To clean my equipment (stove, pans, ect.), change my bulbs and elements

What safety requirements are important for production?

It is very important to keep and make the products in a clean place.

How will quality control and client feedback be handled?

I would make sure that my product is a good quality so that the clients would be happy.


Costing and bookkeeping Edit

How many of each of the stock items can reasonably be sold each day (and month)?

5kg per day. My targets (first week)

  • Rusks = 2kg per day
  • Biscuits = 2kg per day
  • Muffins = 1 dozen per day

Profit per kg = R15 x 5 = R75 per day.

Will sales volumes be a similar number of each item each month, or is their seasonal variation (cold months, hot, or festivals)?'

Yes, more or less the same

What sort of pricing strategy will be chosen (cheapest or best)?

The best

What profit margin will be chosen for the products?

A reasonable profit margin

Write down the cost prices plus the margin for each stock item you will sell, and the selling price.

Ginger biscuits - Cost R15/ Markup R15/ Selling for R30 Chocolate biscuits - Cost R15/ Markup R15/ Selling for R30 Muffins - Cost R15/ Markup R15/ Selling for R30

Is this competitive? Will customers pay this much? Do the margins need to be adjusted? By how much?

Yes, there is no need for adjustment.

Now, set a target. How many items for each product need to be sold on a daily (and monthly) basis to be profitable?

10 items daily and a 100 items monthly (5kg per day).

Set out the products, costs, margins and selling prices:

Ginger biscuits - Cost R15/ Markup R15/ Selling for R30 Chocolate biscuits - Cost R15/ Markup R15/ Selling for R30 Muffins - Cost R15/ Markup R15/ Selling for R30


Item

Daily Target

Monthly Target

Cost Price

Margin

Selling Price

Total per Month

Ginger Biscuits

10

100

R15.00

R15.00

R30.00

= R3000.00

Chocolate biscuits

10

100

R15.00

R15.00

R30.00

= R3000.00

Muffins

10

100

R15.00

R15.00

R30.00

= R3000.00

Rusks

10

100

R15.00

R15.00

R30.00

= R3000.00


What trends are included in the projections?

Effective marketing. I use the sales target as per page 19. Ultimate target of R4 500.00 of sales per month. I have one hired hand to help with baking now and then. From the 4th week I'll get someone to do deliveries and sales (work on commissions only). Pay my own salary from 2nd month. R1000.00 p/m. I replace my pans in month 5 and buy more in month 7. As my sales increase, so my expences increase. I increase my marketing cost so that my sales can increase.

Running the business Edit

What is the process for running the business on a typical day? Who will be responsible for each step? Link this back to the production process.

I will be responsible for my bussiness. I will do baking late afternoon/evening and do deliveries during the day.

Who will act as backup should the person responsible not be there? What do they need to act as backup?

My employee(s) will act as backups. They will need stock.

What weekly processes need to be performed? Who is responsible, who is backup and what tools are required?

My goal is to sell and bake 150kg of my products per month. See page 21 and 25 for targets. Baking, advertising, selling and delivering.

What monthly processes need to be performed? Who is responsible, who is backup and what tools are required?

Buy stock and electricity. Baking and packaging. Taking orders and selling. Pay salaries and commissions. Place adverts and give our pamphlets. Do quality control and speak to clients regarding their needs.

What is the schedule for training and motivating staff?

I will make sure all the requirements are available and I think that will motivate my staff.

What processes are required for maintenance and new product creation? Who is responsible and what tools do they need?

To make sure that all your equipment is in a good condition. I will be responsible for the stock and buying electricity.


Before beginning Edit

List some of the support services abailable (legal, business and other):

Business support from Red Door. Cape Mail Eden.

What major laws concern the business, and which government departments should be called to keep up to date (list phone numbers)?

Business registration laws. Support from DTI. Munisipality (business zoning)

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