JJB is a bakery and coffee shop managed by two partners. These partners represent sales/management and finance/administration areas, respectively. The partners will provide funding from their own savings, which will cover start-up expenses and provide a financial cushion for the first months of operation. A ten-year Small Business Administration (SBA) loan will cover the rest ofthe required financing. The company plans to build a strong market position in the town, due to the partners' industry experience and mild competitive climate in the area.
2.1 Company Ownership
JJB is incorporated in the state of Washington. It is equally owned by its two partners.
2.2 Start-up Summary
JJB is a start-up company. Financing will come from the partners' capital and a ten-yearSBA loan. The following chart and table illustrate the company's projected initial start-up costs.
Premise renovation $20,000
Expensed equipment $40,000
Total Start-up Expenses $64,000
Cash Required $70,000
Other Current Assets $12,000
Long-term Assets $65,000Total Assets $147,000
Total Requirements $211,000
Start-up Expenses to Fund $64,000
Start-up Assets to Fund $147,000
Total Funding Required $211,000
Non-cash Assets from Start-up $77,000
Cash Requirements from Start-up $70,000
Additional Cash Raised $0
Cash Balance on Starting Date $70,000
Total Assets $147,000Liabilities and Capital
Current Borrowing $0
Long-term Liabilities $100,000
Accounts Payable (Outstanding Bills) $1,000
Other Current Liabilities (interest-free) $0
Total Liabilities $101,000
Additional Investment Requirement $0
Total Planned Investment $110,000
Loss atStart-up (Start-up Expenses) ($64,000)
Total Capital $46,000
Total Capital and Liabilities $147,000
Total Funding $211,000
JJB offers a broad range of coffee and espresso products, all from high quality Columbian grown imported coffee beans. JJB caters to all of its customers by providing each customer coffee and espresso products made to suit the customer,down to the smallest detail.
The bakery provides freshly prepared bakery and pastry products at all times during business operations. Six to eight moderate batches of bakery and pastry products are prepared during the day to assure fresh baked goods are always available.
Market Analysis Summary
JJB's focus is on meeting the demand of a regular local resident customer base, as well as asignificant level of tourist traffic from nearby highways.
4.1 Market Segmentation
JJB focuses on the middle- and upper-income markets. These market segments consume the majority of coffee and espresso products.
JJB wants to establish a large regular customer base. This will establish a healthy, consistent revenue base to ensure stability of the business.
Tourist trafficcomprises approximately 35% of the revenues. High visibility and competitive products and service are critical to capture this segment of the market.
4.1.1 Market Analysis
The chart and table below outline the total market potential of the above described customer segments.
4.2 Target Market Segment Strategy
The dominant target market for JJB is a regular stream of local residents. Personal andexpedient customer service at a competitive price is key to maintaining the local market share of this target market.
4.2.1 Market Needs
Because Washington has a cool climate for eight months out of the year, hot coffee products are very much in demand. During the remaining warmer four months of the year, iced coffee products are in significantly high demand, along with a slower but consistent...