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Table of Contents

Introduction ............................................................................................................................... 2
Vision.......................................................................................................................................... 2
Mission ....................................................................................................................................... 2
Goals and Objectives.................................................................................................................. 2
Feasibility Study ......................................................................................................................... 3
A. Product/ Service Feasibility............................................................................................ 3
1. Product/ Service Desirability...................................................................................... 3
B. Industry/Target Market Feasibility ................................................................................ 7
1. Description of the Industry: ....................................................................................... 7
2. Current Market Analysis: ........................................................................................... 7
3. Level of Competition: ................................................................................................. 7
4. Anticipated Future Market Potential: ........................................................................ 8
5. Potential Buyers and Sources of Revenue: ................................................................ 8
6. Sales Projection: ......................................................................................................... 8
C. Organizational Feasibility ............................................................................................... 9
1. Organizational Structure of Bake n Flake: ................................................................. 9
D. Financial Feasibility Analysis ............................................................................................ 21
1. Total start-up of cash needed .................................................................................. 21
2. Overall Financial Attractiveness of the proposal ..................................................... 24
Ratio Analysis ........................................................................................................................... 28
1. Current Ratio ................................................................................................................ 28
2. Equity Ratio .................................................................................................................. 28
3. Debt to Equity Ratio ..................................................................................................... 28
4. Inventory Turnover Ratio ............................................................................................. 29
5. Assets Turnover Ratio .................................................................................................. 29
6. Profit Margin or Return on Sales ................................................................................. 29
7. Return on Assets .......................................................................................................... 29
Overall Conclusion ................................................................................................................... 31

1
Introduction
Bake N Flake is a company established with the partnership of two people so as to
cater the current need of demand of cakes at the ease of customers. We not only serve
cakes to the customers but also provide them with the joyful environment by adding
happiness in their busy schedule and bridging the gap between family and
professional life. Our office is located at Baneshwor, Kathmandu. In addition, we
serve our product through online also. We believe in customer satisfaction by
providing quality product and services with the aim of meeting their needs.

Vision
The main important reason behind starting this bakery is to bridge the gap between
busy, hectic life and personal life of individuals.

Mission
Bake N Flake aims to be keystone in the city creating a neighbourhood and friendly
atmosphere where customers can feel comfortable. We also aim to establish a legacy
in cake industry by providing delicious and tasty cakes. We seek fair profit so that our
bakery is financially stable and healthy.

Goals and Objectives


Building a broad and committed customer base.
Developing a business model that brings in enough income to cover our
expenses.
To make people connected from their work to their personal life through cake.
Build reputation by producing high-quality products and maintaining excellent
customer service.

2
Feasibility Study
Feasibility study is the evaluation and analysis of the proposed business whether it is
feasible or not. It aims to examine the strength and weaknesses of the proposed or
existing business venture and also opportunities and threat present in the market. It
also depicts vibrant information about the required resources and predictions for
success. The sole purpose of the feasibility study is to determine whether the proposed
project or plan is worth the investment or not.
The feasibility study can be specifically categorized into four phases. They are as
follow:
A. Product/ Service Feasibility
B. Industry/ Target Market Feasibility
C. Organizational Feasibility
D. Financial Feasibility
If all of these phases are approved, then the business plan is proceeded.

A. Product/ Service Feasibility


This section discusses about the product and service that it has to offer to its
customers. It provides the information about the cake and how it intends to
provide its services to targeted customers.

1. Product/ Service Desirability


a. Concept Test
i. Description of the Product: This section provides the clear idea about
the cake, its various shapes and size which it has to offer to its valuable
customers. It includes the following:
Size: Starting from one pound
Shape: Round, square, heart, layer, custom design as well such as
Cinderella, Doremon, and so on.
Quality: We provide juicy, fresh, and delicious mouth-watering
cakes. Ingredients used in the cake like flour, egg, milk, cream etc.
are of better quality.

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ii. The Intended Target Market: This section details the list of potential
customers or business organization who are expected to purchase our
product and love our services provided. It includes the following:
Age: includes all age group
Gender: No gender boundary
Income: Targeting high income and middle-class people
Territory: Basically, Kathmandu Valley area focusing on
educated, busy, and affluent family. For example: Sanepa Area,
civil homes of Kalanki, Sitapaila, Nakhu etc.
Occasion: Birthdays, weddings. Anniversaries, Mother are Day,
Fathers Day and other auspicious celebrations as well.

iii. The Benefits of the Product/ Service: Bake N Flake basically attempts
to bridge the gap between professional life and family life by adding sweet
flavours to their monotonous and busy life. We believe in benefiting others
to be benefitted. Our customers will be rewarded with quality services and
similar benefits which will be boon for our company.
Benefits to the Customers
Affordable Price: we provide quality delicious cakes in an
affordable price starting from
Rs. 400 that ranges to Rs. 700 according to the nature of cakes.
Occasions: We provide variety of cakes to our customers as per
the occasions to make the moment even more special.
Convenience: Customers will get our service in a very convenient
way. We engage ourselves in following activities for the
convenience of customers:
We will use survey method to collect information from
customers like birthdays, anniversaries, etc. from
specific places such as Sanepa, civil homes, Nakhu
(territory of affluent family).
We will connect with our customers in social media like
Facebook, Instagram so that we can provide them the
information about our company and the services

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provided and deliver cake in the right place and in right
time based on a single phone call.
After collecting the information of customers, the customers (wealthy,
busy, and educated) will get a reminder call just before a week of the
celebration i.e. we will give a call to the busy people to remind them of
the special day coming soon and attempting to convince them to order
cake from us. If they say yes then we will deliver our cake at right
time in right place. We will track the birthdates and other details of
customers in a customer database.
Customization: We produce and deliver cakes of different shapes,
sizes, colours, flavours, as per the requirement of the customers. We
will provide high customization in our product and service which is
described in the section Description of product and service
Quality Product: Our quality is reflected in fresh, tasty, and juicy
cakes.
Free Delivery: Online delivery will be a customer-oriented service.
We offer free service or delivery without charges at the ease of the
customers.
24*7, 365 days: Our service will be enjoyed by customers every
time, every moment, and in every circumstance. We provide endless
services to our customers.
Bridges Gap: We tend to reduce gap between family and
professional life by adding jolly moments in their busy schedule.
Special Package: We provide special services to our regular
consumer and other customers too. For this we will be assigning
membership card to our customers and track their activities for
special benefits.
Every time a cake is ordered, we will offer a birthday
candle as a small gift with the cake.
We will offer 1 cake for free to the family when the number
of family member is equal to the number of cakes ordered
within a year i.e. if there are 5 members in a family, 1 cake
will be offered free when 5 cakes are ordered within a year.

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Benefits to Organization
Market Coverage: We will offer quality cakes with different
varieties and also other special packages like reminder call that will
create demand in market and helps in market coverage.
High Revenue: Better quality, variety, customization, and quality
services helps to earn high revenue in the market.
Recognition: All the benefits of quality, variety, reminder call,
customization etc to the customer adds value to our organization and
make our product recognized in the market which will help to
establish our brand.
Customer Satisfaction: Since we provide different quality product
and services, that will satisfy the customer and customer satisfaction
is our first priority.
Environmental Adaptation: We will consider the changing attitude
of customer, taste, their busy schedule, and modify our service
accordingly. This will help us in environmental adaptation.

iv. Companys Position: Bake n Flake is not a new concept in the market.
It is a modified concept as number of similar companies are running and
providing similar services. However, we can bet our company is unique
and its uniqueness is reflected on the following points:
Reminder calls
Free delivery
Special package
High quality and tasty cakes

2. Product demand:
i. Buying Intention Survey: We have conducted a survey of our proposed
product in some of the areas of our target market including Sanepa, Civil homes
and so on. Through the survey, we came to conclusion that 80% of population are
in favour of our product and concept, while remaining 20% were also satisfied but
they provided us with their feedback in order to modify some of our services so
that it will capture the market.

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ii. Library, Internet, and Research: The concept of Bake N Flake emerged
within us with the help of internet and market research. We came to know
people are attracted towards celebrations now a day because of their daily
monotonous schedules. Seeing the situation, we got surety that our idea can
capture the market. So, this is from the point where the idea of Bake N Flake
emerged.

B. Industry/Target Market Feasibility


This section describes about the industry with its history. It also clarifies the
level of competition and the anticipated future market potential. It collects
sufficient material about the potential buyers and projects sales as well.

1. Description of the Industry: Bake N flake is an online cake delivery


company which attempts to provide quality cakes in a reasonable price. The
concept of cake was started from Europe. Likewise, in Nepal, Krishna Pauroti
(now Krishna Breads) was pioneer in cake business which was started in 1948.
Online cake delivery in our Country is an emerging concept from 4-5 years.
UG cakes, Cake Koseli, Julies cake, Annapurna Bakery Shop and so on are
flourishing their cake business in our country. In this way, the concept of cake
was emerged and growing in full pace in todays market.

2. Current Market Analysis: In general, market analysis is the analysis of


market demand, competition, and the demand of our product is possible to
swing upward as our product (cake) is the choice of every people of any age
and gender. Moreover, our product not only fulfil their desires of enjoying the
tasty flavours of sweet, and juicy cakes but also bridges the gap between work
and family life by reminder call and special packages which is not done by any
competitors till now. This uniqueness of our company can be believed will
help us capture the market.

3. Level of Competition: Bake n Flake is a modified concept; hence there is


huge numbers of competitors and high level of competition in the market.
However, we have tried something different and unique that will drive our
market to the top helping us in achieving competitive advantages. Product is
unique in the sense of following services:
Reminder calls
Special packages
Free Delivery
High quality tasty cakes.

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4. Anticipated Future Market Potential: People today are being rich by
wealth but not by social relationships. They focus on wealth generating
activities which is increasing their purchasing power, widening the gap among
their friends and family. Moreover, time is changing and the taste, desire, and
attitude of people are changing. They believe in celebrating occasions to be
connected with their social circle and be free from their monotonous work for
a while. Our company consider their wants and desires by provide high quality
cakes in their home at right time along with attractive packages considering
consumers convenience.

5. Potential Buyers and Sources of Revenue: The potential buyers are


busy, affluent, and educated people who know the value of celebrating
occasions, being connected with people, being free from monotonous work
style, and those who have purchasing capacity. Producing and delivering the
quality cakes will be the major source of our revenue.

6. Sales Projection: Since, our company is limited to Kathmandu valley only;


we project our sales to be 10 units per day. However, this projection might
increase in our growth and maturity stage when we will be fully capturing the
market. However, our sales units will be seasonal /occasional i.e., we will be
delivering more units of our product in several occasions like wedding
months, mothers day, and fathers day and so on.

i. Industry Attractiveness: It deals with the characteristics of the


industry that makes industry attractive. It includes details of industry like
whether it is old or new, fragmented or concentrated, growing or shrinking
and so on.
This is not new concept; but is modified through different
innovative and quality ideas and services.
The cake companies are in introduction and growth phases in the
market because the taste and demand of people are increasing.
There is several cake shops fragmented all around. But our Cake
Company and concept is unique and is concentrated only in
Kathmandu valley.
The market is highly operating due to growing busy life,
purchasing power, and increasing customers taste and desires.

ii. Target Market Attractiveness: It deals with the condition of target


market for the product. It deals with the level of customer awareness, trend
of market, flow of customer and so on.
Since cake business is not a new concept, people are well aware
about it but the approach we are going to use in it is new and

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customer will become familiar with our new approach when we
start providing our service.
The trend of cake market now is usually online or based on a call
due to peoples busy life and we are offering the same service.
We will promote our business by providing quality cakes and
services that can increase the flow of customers and they will share
their experience with others. This will help to increase the number
of customers.
There are many popular online cake businesses currently running
so there will be a healthy competition but with our new approach of
bridging the gap between family life and work, we can assure you
to stand strong against our competitors.

C. Organizational Feasibility
This section clearly depicts the overall hierarchy of the structure, duties and
responsibilities performed by the post and positions of the staffs, location of
the organization, communication pattern, management style, etc.

1. Organizational Structure of Bake N Flake


The organizational structure of Bake N Flake Company is shown below:

General
Manager

Human
Production Financial Marketing
Resource
Manager Manager Manager
Manager

> Treasurer > Receptionist >Advertiser

> Controller > Delivery Boy > Trainer


> IT Technician

> Online
Promoter 9
Duties and Responsibilities: The duties and responsibilities of employees of
Bake N Flake are as follows:
General Manager
General Manager basically aims in contributing profit to the organization and helps in
achieving competitive advantage by effectively managing staff, establishing and
accomplishing business objectives.
Roles and Responsibilities of General Manager
Formulating strategic and long-term business plan.
Delegating administrative tasks to the employees including accounting, paper
work, and payroll.
Organizing the structure and delegating respective authority to respective
employee.
Formulating policies and help in business decision making.
Measuring, evaluating, and rewarding the employees for motivation.
Supervising and controlling the performance and activities.
Increasing management effectiveness by recruiting, selecting, training, and
counselling.
Building companys image by collaborating with customers, suppliers,
community and stakeholders.
Production Manager
Production Manager makes decision for organizing and planning the production
schedule, sets quality standards, plans for resource arrangement and budget allocation
for production process.
Roles and Responsibilities of Production Manager
Estimating costs of production and setting the quality standards.
Supervising and motivating workers working under them.
Planning and organizing production schedules.

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Making good relation with suppliers and control the inventory.
Setting the quality standards for the product and service to be offered.
Organizing relevant training session for quality improvement, creating
designs, and for other innovations.
Control of industrial production process.
Selecting, ordering, and purchasing the raw materials.
Linking with other departments for effective communication and overall
business benefit.
Be responsible for selection and maintenance of equipment.

Finance Manager
Finance manager helps in decision making processes to ensure that businesses are
financially successful. The goal is to enable the companys leaders to make sound
business decisions and meet the companys objectives.
Roles and Responsibilities of Finance Manager
Collating, preparing and interpreting reports, budgets, accounts, commentaries
and financial statements of the bakery
Undertaking strategic analysis and assisting with strategic planning
Producing long-term business plans
Undertaking research into pricing, competitors and factors affecting
performance of the bakery
Controlling income, cash flow and expenditure of the bakery
Managing budgets
Developing and managing financial systems/models
Carrying out business modelling and risk assessments
Supervising staff under financial department
Maintaining financial health of the company
Corresponding with various other departments, discussing companys plans
and agreeing on future paths to be taken.
Marketing Manager
Marketing manager is responsible for managing day to day marketing activities of the
organisation and long-term marketing strategy for the company.

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Roles and Responsibilities of Marketing Manager
Managing all marketing activities within the marketing department.
Developing the marketing strategy for the bakery in line with bakerys
objectives.
Co-ordinating marketing campaigns with sales activities.
Overseeing the companys marketing budget.
Planning and implementing promotional campaigns of bakery through
internet.
Preparing online and print marketing campaigns.
Monitoring and reporting on effectiveness of marketing communications.
Creating a wide range of different marketing materials.
Working closely with design agencies and assisting with innovative ideas for
cake production.
Maintaining effective internal communications to ensure that all relevant
company functions are kept informed of marketing objectives.
Human Resource Manager
Human Resource Manager maintains and enhances the organization's human
resources by planning, implementing, and evaluating employee relations and human
resources policies, programs, and practices so as to meet organizational objectives.
Roles and Responsibilities of Human Resource Manager
Maintaining the work structure of the company by updating job requirements
and job descriptions for all positions.
Identifying staff vacancies and maintaining organization staff by establishing a
recruiting, testing, and interviewing program
Preparing employees for the task by establishing and conducting orientation
and training programs.
Measuring performance of the employees and improvising the system
Developing and administering programs, procedures, and guidelines to help
align the workforce with the strategic goals of the company.
Conducting a continuing study of all Human Resources policies, programs,
and practices to keep management informed of new developments.
Maintaining employees training record

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Communication Pattern
In our bakery, we will be using two-way communication style rather than one-way.
Two-way communication helps us to exchange views and opinions from top level to
low level and vice-versa. Opinion of every person is given equal priority in our
bakery. Similarly, we will be adopting conceptual and behavioural style of
management. It is conceptual because it is an original concept and the success is
purely determined by the teamwork of the bakery.
Curriculum Vitae of the Employees of Bake N Flake
Bio- Data of General Manager
Personal Details
Name: Rojita Maharjan
Address: Chamati, Kathmandu
Mothers Name: Meema Maharjan
Fathers Name: Bhupal Maharjan
Contact No.: 9843379563
Date of Birth: 1992/06/23
Email: rojitamhrzn18@gmail.com
Nationality: Nepali
Marital Status: Single
Language spoken: Nepali. English, Newari, Hindi
Academic Qualification
S.N. Level Board Institution Division Passed
Year
1. S.L.C Govt. of Kathmandu Model Distinction 2005
Nepal School (87.625%)
2. +2(Mgmt) HSEB National Institute Distinction 2007
of Science and (84%)
Technology(NIST)
3. BBA TU Shanker Dev Distinction 2011
Campus (3.70)
4. MBA HU Harvard Business Distinction 2013
School (3.70)

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Experience
Management Trainee at Annapurna Hotel for 1 and half year
Assistant Manager at Lekali Restaurant for 2 years
Manager at The Ultimate Restaurant for2 years
Training
Diploma in web page designing with distinction from Aptech Computer
Institute (Jamal, Kathmandu)
Personality development class from Sahara Institute
Training in accounting and financial activities in GIMA Institute
Achievements and Scholarship
Won Miss Discipline in Miss Jyapu Beauty Pageant
Got full scholarship in +2 for being entrance topper
Awarded as college topper
References
Mr. Shakti Raj Joshi, Owner of Annapurna Hotel
Lal Prasad Aryal, Facilitator of Shanker Dev College

Bio- Data of General Manager


Personal Details
Name: Krisha Neupane
Address: Macchapokhari, kathmandu
Fathers Name: Babu Ram Neupane
Mothers Name: Kopila Neupane
Contact No. 9843035206
Email: n.krisha14@gmail.com
Nationality: Nepali
Marital Status: Unmarried
Language spoken: Nepali and English

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Academic Qualification
Passed
S.N. Level Board Institution Division
Year
Siddhartha Vanasthali
Nepal Distincti
1. S.L.C. Institute, Vanasthali 2004
Board on (86%)
Kathmandu
+2 H.S.E. Canvas International Distincti
2. 2006
(Mgmt.) B. college, Kathmandu, Nepal on (82%)
Shanker Dev Campus,
Dist.
3. BBA T.U Putalisadak, Kathmandu, 2010
(3.75)
Nepal
Dist.
4. MBA HU Harvard Business School 2013
(3.70)

Experience
2 years logistic management experience.
Supervisor in R and K manufacturing company for 3 years.
Assistant manager in Occidental power plant for1 and half year.
Training
Training on communication skills.
Participated different workshops regarding business environment
challenges and prospects.
Training on accounting and financial activities on MIMA institute.
References
Mr. Hari Bahadur Pandey, Manager, R$ K company, Dillibazar
Kathamandu.
Mr. Lal Prasad Aryal, Facilitator, Shaker Dev Campus.
Mr. Babu Ram Khatiwoda, Manager, Occidental Power Plant.

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Bio-Data of Production manager
Personal Details
Name: Roshan Lamsal
Address: Vanasthali, Kathmandu
Email: roshanrajlamsal@pahs.edu.np
Fathers Name: Nava Raj Lamsal
Mothers name: Indira Lamsal
Contact No. 9860257823
Nationality: Nepali
Marital Status: Unmarried
Language Spoken: Nepali, Hindi, and English
Academic Qualification
Passed
S.N. Level Board Institution Division
Year
Siddhartha Vanasthali
Nepal Distincti
1. S.L.C. Institute, Vanasthali 2003
Board on (87%)
Kathmandu
+2 H.S.E. Trinity International Distincti
2. 2005
(Mgmt.) B. college, Kathmandu, Nepal on (80%)
Nepal Commerce Campus, Dist.
3. BBA T.U 2009
Minbhawan, Nepal (3.80)
Dist.
4. MBA HU Harvard Business School 2012
(3.75)

Experience
Quality expert in D&D Company for 2 years.
Assistant manager in Jackson Bakery Cafe for 1.5 years.
Inventory manager and production supervisor in Nepal Food Cafe for 3
years.
Training
Diploma in Computer (Introduction, MS-Word 2007, MS-Excel
2007,

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MS-PowerPoint 2007, Email & Internet, Adobe PageMaker 7.0,)
from Oxford International Pvt. Ltd., Kalimati, Kathmandu, Nepal
Training on improving communication skill
6 months courses on human psychology; understanding
consumer behaviour and buying pattern.
References
Prof. Dr. Govind Ram Agrawal, Shanker Dev campus
Email: agrawal77@gamil.com
Mr. Lal Prasad Aryal, Shanker Dev Campus
Email: Aryalprasad098@gmail.com
Bio data of Finance Manager
Personal Details
Name: Sajita Maharjan
Address: Panga, Kirtipur
Mothers Name: Meema Maharjan
Fathers Name: Bhupal Maharjan
Email: sajita123@gmail.com
Date of Birth: 2049/06/11
Contact No.: 9840070669
Nationality: Nepali
Marital Status: Married
Language Spoken: Nepali, English, Newari, Hindi
Academic Qualification
S.N. Level Board Institution Division Passed
Year
1. +2 HSEB Whitefield Distinction 2064
International
College
2. BBS TU Sirius First 2068
College Division
3. MFC TU TU First 2070
Division

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Experience
Assistant accountant at Ridhi Sidhi Co-operative for 1 year
Supervisor at Atlas Finance for 1 and half year
Accountant at Sanima Bank for 2 years
Training
Diploma in computer (Introduction, MS-Word 2007, MS-Excel 2007,
MS-PowerPoint 2007, Email & Internet, Adobe PageMaker 7.0) from
NIIT Computer Institute
Senior accountant training from Ellipse Institute, Nepal
References
Shasindra Pradhan Pama, Chairman, Ridhi Sidhi Co-operative
Dilli Ram Bhattarai, Facilitator, Sirius College
Bio-data of Marketing Manager
Personal Details
Name: Rasaj Maharjan
Address: Dhokatole, Kathmandu
Date of Birth: 1992/06/06
Email: linkinboirasaj@gmail.com
Mothers Name: Samjhana Maharjan
Fathers Name: Roshan Maharjan
Contact No.: 9840063898
Nationality: Nepali
Marital Status: Single
Language Spoken: Nepali, English, Newari, Hindi, Japanese
Academic Qualification

S.N. Level Board Institution Division Passed Year


1. +2 HSEB NIC Distinction (83%) 2004
2. BBA KU KUSSOM Distinction (3.80) 2006
3. MBA WestCliff Presidential First Division 2010
University Business
School

18
Experiences
Assistant Marketing Manager at Laxmi Bank for 1 and half year
Supervisor of marketing department in Accessories Nepal, Kathmandu
Training
Diploma in computer (Introduction, MS-Word 2007, MS-Excel 2007,
MS-PowerPoint 2007, Email & Internet, Adobe PageMaker 7.0) from
Asia Computer Institute
Language class from Everest Language Institute
References
Pradeep Shrestha, Branch Manager, Laxmi Bank
Kushal Man Singh, Facilitator, NIC
Bio Data of Human Resource Manager
Personal Details
Name: Kripa Neupane
Address: Balaju, Kathmandu
Fathers Name: Ram Babu Neupane
Mothers name: Gayatri Neupane
Contact No.: 9849067933
Nationality: Nepali
Marital Status: Unmarried
Language Spoken: Nepali, English, and French
Academic Qualification:
Passed
S.N. Level Board Institution Division
Year
Nepal Little Angles, Lalitpur, Distincti
1. S.L.C. 2005
Board Nepal on (87%)
+2 H.S.E. Trinity International Distincti
2. 2007
(Mgmt.) B. college, Kathmandu, Nepal on (80%)
Nepal Commerce Campus, Dist.
3. BBA T.U 2011
Minbhawan, Nepal (3.80)
Dist.
4. MBA KU KUSOM 2014
(3.60)

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Experience
Human Resource Manager in Mega Bank for 2 years.
Staff accountant and financial consultant for the real estate industries for
1 and half years.
Department Manager of K$K enterprises for 2 years.
Training
Classes on French Language for about months.
Participated Human Resources training programs and seminars in GIMA
training centre.
Attended seminars on workshops on improving communication skills and
understanding human psychology.
Reference
Mr. Ram Prasad Aryal, Director, Nepal Commerce Campus.
Mr. Steve Richards, Trainer, GIMA
Mr. Harihar Nepal, Campus chief, KUSOM.
Resource Sufficiency: To carry out all the tasks promptly, we require all
types of resources which are explained below:
Human Resource: There will be 30 members in our organization. They are
General Manager 2
Production Manager 1
Financial Manager 1
Human Resource Manager 1
Marketing Manager 1
Baker 3
Waiter 4
Delivery Boy 5
Production Supervisor 1
Material Planner - 1
Quality Expert 1
Designer 1
Treasurer 1

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Controller- 1
Receptionist 1
IT technician 1
Advertiser 1
Trainer 1
Online Promoter 1
Cashier 1
Material Resources: All the materials required for the production of cake will be
purchased from the trusted suppliers. This will ensure the quality of our cake and its
timely production and delivery.
Financial Resources: The nature of our company is a Partnership Firm so the shares
are divided among two general managers and the inadequate amount will be taken
from the financial institution.
Land and Building: The building for the production and outlet will be taken on lease
at its best price. Location around Baneshwor will be selected which is easily
accessible. Parking area, sufficient area, etc will also be taken into consideration.
Machinery and Equipment: The necessary machineries and equipment for the
production of cake will be made available accordingly.

D. Financial Feasibility Analysis


Financial Feasibility is the assessment of the financial aspects of a proposed venture
to decide whether it is financially viable or not. This section deals with the overall
financial attractiveness of the proposed venture.
The significance of financial feasibility is felt more important because in order to start
any business venture, one should have enough finance to commence and to run the
business. And for this, financial feasibility analysis serves a useful purpose. The most
important issues to be considered in financial feasibility include total start up cash
needed, financial performance of similar business, and the overall financial
attractiveness of a proposed venture

1. Total start-up of cash needed


The total cash needed for starting our company is approximately Rs.1321000 upon
calculation. Since our company is a partnership firm, proper registration is necessary.
Under Partnership Act, 2020, the following things are the significant points:

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Agency: Department of Commerce
Application Fee: Rs.100
Maximum Processing Time: 1 day
Status: Partnership act, 2020, section 5 to 9
Validity: 3 years
Requirements
Application form
Passport size photographs (2) of all the partners
Citizenship certificate of all the partners
Agreement letter between partners
Tax registration certificate

Cost of Production and Financing


Legal fee: Rs. 30,000
Cost of Survey: Rs. 20,000
Expenses of Drafting and Printing: Rs. 10,000
Documents Registration Charge: Rs. 50,000
Other official Expenses: 50,000
Initial Advertising Expenses: website Design: 1,00,000

a. Cost of Fixed Assets


The assets which are purchased for long term use and are not likely to be
converted into cash are fixed assets.

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Cost of Tangible Assets
S.N. Particulars Size/ Quantity Amount
1. Oven 3pcs 45,000
2. Proof boxes 2pcs 1,500
3. Mixers 2 pcs 15,000
4. Refrigerator 1 pcs 35,000
5. Chairs 16 8,000
6. Tables 4 (3 ft.) 28,000
7. Sofa 1 20,000
8. T.V. 1 (24 inch) 28,000
9. Lamp 4 pcs 1,750
10. Display case 1 pcs 13,500
11. Chalkboard 1pcs 700
12 Baking sheets 5 pcs 1,000
13. Racks 2pcs 10,000
14. Work table 1pcs 15,000
15. Sink 1pcs 2,000
16. Round table 1pcs 7,500
17. Pans 4pcs 6,000
18. Slicers 2pcs 400
19. Miscellaneous (Scale, 2,500
cake decorating tool,
spatulas, rolling pins,
packaging paper, oven
mitts)

b. Cost of Current Assets


The assets which are purchased for short term use usually within one year and
can be easily converted into cash is current assets.
Cash and bank balance 5,00,000
Inventory 50,000
Debtor 1,00,000
Prepaid expenses 20,000

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c. Cost of Developing Business
It includes contingency expenditure which is separated for potential future
event that may occur in the future time.
Contingency Expenditure 1,50,000

2. Overall Financial Attractiveness of the proposal


The financial attractiveness of a company can be determined by preparing
proposed financial statements which include Income statement, Balance sheet,
Ratio Analysis, and Cash Flow Statement.

i. Trading Account

Trading Account of Bake N Flake


As on 31st Ashad, 2074

Particulars Amt Particulars Amt


To Purchase 5,50,000 Sales (3652 units @ 575 21,00,000
each)
To carriage inwards 50,000 Closing stock 10,00,000
To carriage outwards 60,000
To power and fuel 1,00,000
To manufacturing expenses 2,00,000
To Gross Profit 21,40,000
Total 31,00,000 Total 31,00,000

Working notes:
For purchase
Ingredients Qty per month Price per kg/unit Total cost for a
(Rs) year
Wheat flour 250 kg 50 1,50,000
Eggs 200 pieces 15 36,000
Sugar and salt 150 kg 95 1,71,000
Creams and 100 kg 110 1,32,000
flavours
Others 61,000

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Purchase for the year: 550000
For Sales
Average Sales per day: 10 cakes
Average price per cake: (400+450+500+550+600+650+700+750)/8 = 575
Average sales per day in Rs: 5750 (Rs.2100000 in a year)

ii. Profit and Loss Account

Profit and Loss Account of Bake N Flake


As on 31stAsadh, 2074
Particulars Amt Particulars Amt
To salary 2,00,000 By gross profit b/d 21,40,000
To stationery and printing 10,000 By discount received 5,00,00
To insurance premium 1,00,000 By commission received 1,00,000
To repairs and maintenance 50,000
To depreciation 20,000
To registration charge 50,000
To contingency expenses 1,50,000
To advertisement 1,00,000
To rent of building 5,00,000
To utilities 50,000
To legal charges 30,000
To cost of survey 20,000
To interest expenses 1,00,000
To selling and distribution 50,000
expenses
To tax paid 50,000

To discount allowed 80,000

To Net profit 7,30,000

Total 22,90,000 Total 22,90,000

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iii. Balance Sheet

Balance Sheet of Bake N Flake


As on 31stAsadh, 2074
Capital Amt Assets Amt
Share capital 7,00,000 Machinery and 1,32,650
equipments
Bank loan 8,00,000 Furniture 1,05,700
Accounts payable 3,00,000 Cash on hand 2,00,000
Outstanding expenses 1,08,350
Net profit 7,30,000 Cash at bank 3,00,000
Accounts receivable 4,00,000
Prepaid expenses 5,00,000
Closing stock 10,00,000
Total 26,38,350 Total 26,38,350

iv. Cash Flow Statement


Cash flow of Bake N Flake
As on 31stAsadh, 2074
Particulars Amount Amount
1. Cash Flow from Operating Activities
A. Cash sales and received from debtors
Sales 21,00,000
Receivable -4,00,000
Discount allowed -80,000 1,620,000
B. Cash Paid and Payment to Creditors
Purchase -5,50,000
Payable 3,00,000
Discount received 50,000 -2,00,000
C. Cash Paid to Employees and Other Operating
Activities

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Salary -2,00,000
Rent -5,00,000
Increase in outstanding expenses 1,08,350
Increases in prepaid expenses -5,00,000
Utilities expenses -5,0000
Cost of survey -20,000
Legal fees -30,000
Registration Charge -50,000
Contingent expenses -1,50,000
Stationery and printing -10,000
Selling and distribution cost -50,000
Repair and maintenance -50,000
Insurance paid -1,000,00
Carriage inward -50,000
Carriage Outward -60,000
Commission Received 100000
Advertisement expense -1,00,000 -1,711,650
D. Payment of Tax and Interest
Tax paid -50,000
Interest paid -1,00,000 -150,000
Net Cash Flow from Operating
-4,41,650
Activities(A+B+C+D)
2. Cash Flow from Investing Activities
Machine and equipment -1,32,650
Furniture -105700
Net Cash Flow from Investing Activities -2,38,350
3. Cash Flow from Financing Activities
Capital 7,00,000
Loan 8,00,000
Net cash flow from financing activities 1,500,000
Net Cash Flow and Cash Equivalent (1+2+3) 820000
Add: Opening Cash and Bank balance 500000
Closing Balance 1320000

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Ratio Analysis
1. Current Ratio
The current ratio measures the ability of a company to pay its current liabilities
with its current assets. It can be calculated as follows:
Current ratio = Total current assets/total current liabilities
= (cash in hand + cash at bank + account receivables +
prepaid expenses)/ (account payable+ outstanding
expenses)
= (200000+300000+400000+500000)/(300000+108350)
= 3.42
So, a current ratio of 2.1 means that the company has 3.42 times more current
assets than current liabilities.

2. Equity Ratio
The equity ratio is a solvency ratio that measures the amount of assets that are
financed by owners investments by comparing the total equity in the company
to the total assets.
Equity ratio =Total equity/Total assets
=7,00,000 / 26,38,350
=0.26
So, equity ratio of 0.26 means that the companys equity is 0.26 times greater
than its assets.

3. Debt to Equity Ratio


The debt to equity ratio shows that the percentage of company financing that
comes from creditors and investors.
Debt to equity ratio = long term debts/Total equity
=80,00,00/ 7000000
=0.1142 or 11.42%
So, debt to equity ratio of 0.66 means a creditor owns 0.11 paisa in every
Re.1 and an investor owns 0.88 paisa in every Re.1.

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4. Inventory Turnover Ratio
The inventory turnover ratio is an efficiency ratio that shows how effectively
inventory is managed by a comparing cost of goods sold with average
inventory for a certain period.
Inventory turnover ratio = Net sales/closing stock
= 2100000/ 10,00,000
=2.1
So, inventory turnover ratio of 2.1 means that the company sold its products
2.1 times over.

5. Assets Turnover Ratio


The asset turnover ratio is an efficiency ratio that measures a companys
ability to generate sales with average total assets.
Asset turnover ratio = Net sales/ average total assets
=2100000 / (2638350/2)
=1.59
So, asset turnover ratio of 1.59 means that our company generates Rs.1.59 in
every Re.1 invested in assets.

6. Profit Margin or Return on Sales


Profit margin is a profitability ratio that measures the amount of net income
earned with each rupee of sales generated by comparing the net income and
net sales of a company.
Profit margin or return on sales = Net income/Net sales
= 730000/2100000
= 0.347
So, profit margin of 0.347 means that a company has occurred profit of
34.76% of total sales.

7. Return on Assets
Return on assets is a profitability ratio that measures the net income produced
by total assets during a period by comparing net income to the average total
assets.
Return on assets = Net income/ average total assets
= 730000/ (2638350/2)
= 0.553
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So, return on assets of 0.553 means that a company bears profit of 0.553 paisa
in every Re.1 it invests in assets.

A. Breakeven Point (BEP) Analysis of Bake N Flake


i. BEP Sales in Units = fixed cost/ unit selling price- unit variable
cost
= 338350/ (575-112.27)
= 732 units
Note: Fixed costs= (interest+ furniture+ machineries)
Unit variable cost = (power and fuel + carriage inward+ Carriage
outward+ manufacturing expenses)/sales units
ii. BEP Sales in Rupees = BEP sales in units * selling price per unit
=732*575
=Rs.420900
iii. P/V Ratio = 1-(v/s)
= 1-(112.27/575)
= 0.804
iv. Cash BEP in Units = fixed cost- depreciation /(unit selling price-
unit variable cost)
= (338350-20000)/ (575-112.27)
=688 units.

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Overall Conclusion
The purpose of conducting feasibility study analysis of Bake N Flake Company was
to know the whether the proposed idea is viable or not. Upon analysing different
factors of feasibility of Bake N Flake Company, it gives the detail image of the
position of product demand, desirability, industry/ market attractiveness, financial
position, and organizational setup of the company.
Product feasibility of a Bake N Flake Company gives description of the reasonable
size, shape, quality, cost and functions of product, target customers, and companys
position that our company should undertake to get success. Through buying intention
survey, we get to know 85% people are in favour of our product which proves it will
easily capture the market. Similarly, target market feasibility shows that our concept
is a modified one but due to our unique concept of special packages, reminder call,
free delivery, and high quality, our product can gain competitive advantage in long
run. Likewise, organizational feasibility details the roles and duties to be carried by
each employee in the office. Bake N flake is carried by 2 general managers with 31
other staffs which is the best organizational setup when viewed through the nature of
company. Moreover, financial feasibility shows that company is financially viable as
it will be earning 7,30,000 with positive cash flows throughout the year having sales
projection of 21,00,000 by selling 10 cakes per day in an average. Likewise, other
financial analysis and ratios also give positive sign for the establishment of the
company.
Hence, by considering all the above factors, it is concluded that the company is
feasible to start and operate in the marketplace.

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