Opening a Bakery: The Business Plan

A business plan outlines the essentials of your proposed venture and tells potential investors what you plan to do with their money.  We've been open three years, but still refer to it when making important business decisions.  It has seven basic sections.

1. Overview.  Explains your concept in a single, SHORT paragraph. In our case, we offer custom wedding and specialty cakes in a retail bakery environment.
2. Description. Describes your business in more detail.  What do you plan to sell, why, and how do these items support your overall concept?  Everything we do and sell supports the sale of custom wedding and specialty cakes. Even the fact that we are a retail bakery supports this concept as wedding and celebration cakes are mostly made for weekend events.  Cookies and pastries are baked at other times when the ovens are not needed for cakes.  These products also give customers a reason to come into the bakery when they do not need a cake. When done properly, they also establish and support the image of a high quality bakery.  Workshops highlight the artistic quality of products from the bakery.
3. Location. Where do you plan to locate your business?  Will you own or lease?  And how does this location support your overall concept (sensing a theme here?). Our bakery is located in an historic district among other independently owned galleries and shops selling high quality and unique products such as home furnishings, baby clothes and furniture, and antiques.
4. Competitive Environment. How large is the market for your products?  Who is your competition?  How much market share do you plan to have? How and why is this realistic?  Are there other bakeries serving your market?  What do they offer and how much do they charge?  In our case, we also researched the number of marriage licenses issued in the county every week, as well as the venue offerings and other wedding vendors.
5. Marketing Plan.  Long term, this is the most important section as you will refer to it over and over.  It explains how you plan to meet your sales goals.  Who are your customers?  How will you reach them, and how much do you plan to spend to do this?  What is the planning process for wedding related sales?  When and how do brides decide where to buy their wedding cake?  What about birthday cakes, anniversary cakes, baby shower cakes, etc.  When distributing precious marketing dollars, which channels give you the most return?  Over the years we have used the initial thought process in this section to decide NOT to buy advertising in telephone directories or billboards, but to spend money on bridal directories and wedding websites.
6. Management. Who is going to run this venture.  How are they qualified to do so?
7. Financial Plan. What are the new business' needs in terms of capital equipment, working capital (cash) and what are the sources and uses of funds for the first 3-5 years (or until the business becomes self-sustaining and the loans have been paid off).  Cash flow is just as important as the long term return on the overall investment. What contingencies do you have for cash emergencies such as uncollected invoices, power outages and equipment breakdowns.

The next post will focus on why you need to keep your business plan on your desk and not in the drawer.

Comments

[Business plan Writers]

Hi,
Thanks for posting these essentials here in this blog. As I am a professional business plan writer, this post will really help me writing a bakery business plan. If you want any help regarding business plan feel free to contact our website.

[John Iwaniec]

Mary,
This is so essential to success! I've linked to the article. Having a vision and a plan are so important for culinary artists just as they are for every other business.
Thanks,
John