Running Head: BUSINESS PLAN

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Business Plan Introduction Chelsea Bakery and a!a" Ltd is a start#u$ retail esta%lishment lo&ated in &entral South 'akota( )he %usiness aims at &a$turing and maintaining a loyal &onsumer %ase *ith a !ariety of $astries and &offee $rodu&ts( )he %usiness aims at %uilding a sta%le market in the region and &reating a good market share %e&ause the region has a mild &om$etiti!e en!ironment due to the $o$ularity of $astry and &offee $rodu&ts( )o &a$ture a &onsumer %ase" Chelsea Bakery and a!a" Ltd must enter the market *ith +uality $rodu&ts that ha!e lo*er $ri&es than &om$etitor $rodu&ts( )his *ay" the esta%lishment *ill &a$ture a market from lo&al residents and !isitors in the region( The Business Business Type Chelsea Bakery and a!a" Ltd is in&or$orated in the state of South 'akota( Its shares are e+ually o*ned %y t*o $artners( )he first $artner has e,&e$tional skills in management" sales" and marketing" %e&ause of $re!ious e,$erien&e as a sales and marketing manager and then general manager at a lo&al su$ermarket( )he se&ond $artner has !ast e,$erien&e in finan&e and management %e&ause of his $re!ious -o% as a finan&e manager at the same lo&al su$ermarket" and as a finan&e manager at the lo&al Star%u&ks( )he %usiness *ill also hire fi!e %aristas to $re$are &offee and es$ressos for &ustomers" a &lerk to handle re&ei$t of $ayments and &ustomer ser!i&e" and t*o %akers to %ake fresh $astries( )he mission statement of the %usiness is to $ro!ide &ustomers *ith a great eating and drinking e,$erien&e through selling fresh" high +uality $astry and &offee $rodu&ts( Why a Bakery and Java? (Advantages)

Business Plan Chelsea Bakery and a!a is entering the market *ith a !ariety of $astry and &offee $rodu&ts( )he &offee $rodu&ts are es$e&ially uni+ue and high +uality %e&ause the &offee %eans are im$orted from Colom%ia( As a Bakery and a!a" the esta%lishment *ill $ro!ide its &ustomers high +uality $astry" &offee and es$resso $rodu&ts" &a$turing a good &ustomer %ase %e&ause these $rodu&ts are &ommon among the middle to high#end &lass &ustomers" es$e&ially those *ho go to *ork early in the morning and ha!e no time to ha!e %reakfast at home( A %akery and -a!a %usiness is also good %e&ause it sells fresh $astries and &offee $rodu&ts" *hi&h offer a great food e,$erien&e as &om$ared to $astries from other esta%lishments su&h as $a&ked su$ermarket $astries( Chelsea Bakery and a!a.s $astries are $re$ared all the time during the day to ensure that &ustomers al*ays ha!e a&&ess to fresh and +uality $rodu&ts( A %akery and -a!a %usiness is also good %e&ause it is %eing esta%lished in a market that has mild &om$etition( Com$etition from small %usinesses in the area is mild and similar esta%lishments do not offer the same le!el of &onsumer satisfa&tion in terms of +uality" $ri&e and &ustomer ser!i&e as Chelsea Bakery and a!a( )he esta%lishment *ill" therefore" su&&eed in offering &ustomers high +uality $astry and &offee $rodu&ts *ith $ersonal ser!i&e %e&ause it is esta%lished in a friendly market( Resear&h on the target market has sho*n that &ustomers are looking for +uality $rodu&ts in a rela,ing en!ironment( )hey desire a &lassy and uni+ue e,$erien&e that Chelsea Bakery and a!a is *illing to offer( Disadvantages Chelsea Bakery and a!a may e,$erien&e &om$etition issues es$e&ially the $artners de&ide to e,$and the %usiness in future( /ost highly $o$ulated areas in South 'akota ha!e leading &om$etitors that ha!e a high market share( )hese &om$etitors ha!e &reated the market

Business Plan share through the sale of high +uality $astries and &onfe&tions" and use of high +uality &offee %eans to make high +uality -a!a $rodu&ts( )hey also use e,$ensi!e Italian#style es$resso ma&hines that &an not only make hot %e!erages %ut also make &old#%lended %e!erages( In addition" they make high +uality teas" hot and &old" and distri%ute them to ma-or South 'akota retail stores( As a ne* entrant into the market" Chelsea %akery and a!a may fa&e intense ri!alry from su&h &om$etitors %efore it esta%lishes itself in the market and gains a market share( Large" *ell esta%lished %usinesses may also ha!e &om$etiti!e ad!antage o!er Chelsea Bakery and a!a %e&ause they also ha!e a %road sele&tion of &offees" in !arious si0es" $a&kaging ty$es" and assortments( )hey differ from the %akery in terms of !ariety( Chelsea Bakery and a!a must" therefore" offer !ariety to &ustomers in order to attra&t them and &reate a &ustomer %ase( Instead of offering limited &hoi&es su&h as tra!el tum%lers and logo mugs" like other small %usinesses" the esta%lishment should offer a !ariety in terms of &offee assortments" $astry assortments" and $a&kaging assortments( Chelsea Bakery and a!a *ill also fa&e stiff &om$etition from te&hnologi&ally sa!!y esta%lishments that distri%ute $astry and &offee $rodu&ts through online orders( )his means that the ne* %usiness *ill ha!e to take u$ te&hnology to meet the needs of su&h &onsumers( )his &ould %e &ostly %e&ause it is a ne* esta%lishment( )he &osts *ill in&rease %e&ause the %usiness *ill also ha!e to hire $eo$le to make deli!eries( In addition" te&hnologi&ally sa!!y esta%lishments ha!e %een around the market for a *hile( )his means that they most likely ha!e a loyal online &ustomer %ase( Customers *ill rarely s*it&h to a ne* distri%utor if they are satisfied *ith their &urrent one( 1or e,am$le" most large esta%lishments are $o$ular stores and &offee sho$s su&h as Star%u&ks( )he re$utation of the &om$eting esta%lishments *ill hel$ them kee$ their &ustomers &ommitted(

Business Plan Steps to a Successful and egal Start!"p #unding )he first ste$ that the $artners should take to su&&essfully start u$ their %usiness is to identify sour&e of funding for the %usiness 2Small Business Administration" n(d(3( As $re!iously stated" Chelsea Bakery and a!a.s $artners *ill &ontri%ute start#u$ &a$ital from their $ersonal sa!ings( )hese sa!ings *ill &o!er the start#u$ e,$enses and $ro!ide a finan&ial &ushion for the %usiness( Su%stitute funding *ill &ome from an eight#year SBA loan( )his *ill hel$ &o!er other o$erational e,$enses as the %usiness gro*s( $arket %eeds Another ste$ that the %usiness $artners need to take is to identify market needs( Central South 'akota has e,tremely &old *inters and hot summers( )his means that the %akery and -a!a %usiness needs to offer hot %e!erages during the &old season and &old %e!erages during the hot season( 1or e,am$le" there is high market demand for i&ed &offee during hot summers( Hot &offee" on the other hand" is in high demand during &old seasons( )here is also high demand for &offee %e!erages in the morning %efore ten a(m( )his is *hen $eo$le are usually heading to *ork or taking a %reak from *ork to take %reakfast( )he rest of the day has a steady flo* of &ustomers( )his means that the market needs a &onstant $rodu&tion of %aked goods and -a!a 2Small Business Administration" n(d(3( &roducts Chelsea Bakery and a!a is entering the market *ith $astries and &offee" $rodu&ts *hi&h are already &ommon in the market( )o differentiate their $rodu&t from their &om$etitors.

Business Plan $rodu&ts" the ne* esta%lishment is offering a %road range of fresh $astry and &onfe&tions" as *ell as high +uality &offee and es$resso that is ground from Colom%ian &offee %eans( )hese $rodu&ts are also %eing offered at lo*ered $ri&es( )his differentiation aims at attra&ting and maintaining a loyal &ustomer %ase( High +uality $rodu&ts tend to market themsel!es( Satisfied &ustomers *ill s$read *ord a%out the ne* %akery and -a!a $la&e and attra&t more &ustomers( )he ma-or target market for Chelsea Bakery and a!a.s $rodu&ts is" therefore" lo&al residents of &entral South 'akota( egal $easures In the &ourse of starting u$ the %usiness" the $artners ought to ensure that the statute $ro!isions of Cha$ters 45 and 46 of the South 'akota Codified La*s are follo*ed( 1or e,am$le: a( )he %usiness name" address" and $ur$ose *ill %e registered under the state la*s %( Any &hange in the registered name and address of the %usiness *ill %e notified to the registrar of &om$anies 2South 'akota Legislature" n(d(3( &( )he %usiness must o%tain a ta, identifi&ation num%er( d( )he %usiness must %usiness li&en&es and $ermits( e( )he %usiness must register for state and lo&al ta,es 2Small Business Administration" n(d(3(

Articles of Incorporation Article I

Business Plan )he name of this %usiness is Chelsea a!a and Bakery Ltd( Article II )he num%er of shares the &or$oration is authori0ed to issue are 7 Article III )he address of the $rin&i$al e,e&uti!e offi&e in the State of South 'akota is Street Address88888888(( City888888((State8888(9i$ /ail Address888888888(City8888888State88889i$ Article I' )he South 'akota registered agent name88888888888888(( Street Address88888888(( City888888((State8888(9i$ /ail Address888888888(City8888888State88889i$ CRA num%er : :::::::::::::::::::::::::::::::::::::::::::::::: Article ' )he name and address of ea&h in&or$orator : ;( In&or$orator88888888888888888888888888888 Street Address88888888(( City888888((State88888888888((9i$ <( In&or$orator88888888888888888888888888888((

Business Plan Street Address88888888(( City888888((State888888888888(9i$

'ated::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::: Signature of authori0ed offi&er Printed Name and )itle (ptional &rovisions ;( )his %usiness is organi0ed" solely" for $rofit making <( )he %usiness shall %e managed %y the t*o $artners= shareholders >( Partners ha!e e+ual $o*ers in managing the %usiness 4( A $artner *ill %e" $ersonally" held lia%le for any de%t a&+uired %y the %usiness %e&ause of a&tions non#related to the %usiness ?( Intentional harm to the %usiness" finan&ial %enefit to $rofits of *hi&h a $artner is not entitled" intentional !iolation of the la*" failure to take ne&essary a&tion for the sake of the %usiness" and other &onfli&ts that *ill affe&t %usiness o$erations *ill lead to lia%ility %y the in!ol!ed $artner( @( 1ailure to sol!e %usiness disagreements %et*een $artners *ill lead to *inding u$ of the %usiness" %uying out of a $artner" sell of shares to another $arty" or suing 2South 'akota Legislature" n(d(3( )offee Beans Supplier )ontract

Business Plan )his Su$$ly Agreement is dated August >" <7;>" %et*een Chelsea Bakery and a!a Ltd 2CB 3" a &entral South 'akota &or$oration" and Coffee Bean International 2CBI3" Colom%ia( It is here%y agreed as follo*s: ;( )ER/ of agreement is from Se$tem%er ;" <7;> to August >;" <7;4( <( PRA'UC)S( CBI *ill su$$ly CB *ith Coffee %eans( All sales of the &offee %eans to CB *ill %e in a&&ordan&e to terms of ser!i&e unless terms of ser!i&e are modified %y this agreement( >( CA11EE BALU/E to %e su$$lied %y CBI to CB *ill %e a$$ro,imately ?7"777 $ounds e!ery +uarter 4( PRICE for &offee %eans *ill %e $aid %y CBI to CB at the end of e!ery +uarter ?( 'ELIBERC of &offee %eans to CBI *ill %e done at no &ost @( DUAR)ERLC ad-ustment *ill o&&ur de$ending on seasonal &offee $ri&es 5( PRA'UC) 1RESHNESS AN' DUALI)C must %e ensured %y CBI or CB *ill not $ay for the $rodu&ts 6( Any information %et*een the t*o $arties in the &ourse of %usiness regarding $ri&es and re&i$es shall %e ke$t CAN1I'EN)IAL %et*een the $arties( E( If either of the $arties feel that any of the $ro!isions of this agreement are not enfor&ea%le" then the $arties shall turn to the $ro!isions of statutory la*s Chelsea Bakery and a!a" Ltd Coffee Beans International

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Business Plan A South 'akota Cor$oration By:::::::::::::::::::::::::::: Sales and /arketing /anager" CB By::::::::::::::::::::::::::::: 1inan&e /anager" CB A Colom%ian Cor$oration By:::::::::::::::::::::: CEA By:::::::::::::::::::::: CAA

&ossi*le +thical Decisions )he %usiness $artners of Chelsea Bakery and a!a *ill fa&e many ethi&al dilemmas( 1irst" sometimes food esta%lishments do not get to sell all their $rodu&ts on a slo* day( )his means that they *ould ha!e to dis&ard all the food lefto!ers( )he $artners *ill %e fa&ed *ith an ethi&al dilemma on *hether to dis&ard the $rodu&ts or sell them the ne,t day in order to redu&e &osts( )he ethi&al dilemma arises %e&ause the %usiness $romises &ustomers fresh $rodu&ts e!ery day( Se&ond" there *ill %e ethi&al situations *hen it &omes to $rofit sharing( )he $artners must ensure that they a%ide %y the $artnershi$ agreement and share $rofits and losses e+ually in order to a!oid dis$utes in the $artnershi$( Also" the $artners &an run ethi&al o$erations through donating lefto!er foods and &offee to the homeless instead of thro*ing them a*ay( 1inally" the $artners should ensure that the tra!el mugs" &ake *ra$s" and other $rodu&ts do not ha!e an negati!e im$a&t on the en!ironment( &ossi*le Disagree,ents *et-een &artners

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Business Plan Possi%le disagreements may arise %et*een the $artners in the &ourse of the %usiness o$erations( 1or e,am$le" $artners might disagree o!er de&isions to run the %usiness *hen it &omes to e,$ansion and $rofit sharing( )he $artners might also disagree *hen one $artner sus$e&ts that the other one is taking ad!antage of the other( In addition" they might disagree *hen a $artner is sus$e&ted of fraudulent a&ti!ities" or misa$$ro$riation of funds that %elong to the &om$any( /oreo!er" $artners might disagree o!er &reating a ne* $rodu&t line( In addition" they might disagree *hen it &omes to &hoosing ad!erti0ing tools and methods( 1inally" they might disagree *hen it &omes to &hoosing a sour&e of funding for the %usiness( )hese disagreements &an %e sol!ed through referring to the arti&les of in&or$oration and arti&les of $artnershi$( )hey &an also %e sol!ed through selling shares to another $arty( 1inally" they &an %e sol!ed through legal a&tion( Ter,ination of Business in case of Different Interests *et-een &artners Business &an %e terminated through legal a&tion( )his is in &ases *here the dis$ute %et*een $artners &annot %e sol!ed( It &an also %e terminated through selling full shares to another &om$any or $artnershi$( 1inally" it &an %e terminated through *inding u$ the %usiness(

Small Business Administration( 2n(d(3( 10 Steps to Starting a Business( Retrie!ed from Small Business Administration: htt$:==***(s%a(go!=&ontent=follo*#these#;7#ste$s#starting# %usiness Small Business Administration( 2n(d(3( Do Your Market Research( Retrie!ed from Small Business Administration: htt$:==***(s%a(go!=&ontent=do#your#market#resear&h

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Business Plan South 'akota Legislature( 2n(d(3( South Dakota Codified Laws: Title !" Corporations# Retrie!ed from South 'akota Legislature: htt$:==legis(state(sd(us=statutes='is$layStatute(as$,F StatuteG45H)y$eGStatute