2019

SWEET NEIGHBOUR
BUSINESS PLAN
LEONA ESTANELLE CONSIGO
Executive Summary

Sweet Neighbor is a relaunched, homebased baking, micro enterprise located in Ortigas

Center, Pasig City owned and managed by the Consigo Family. It offers renowned
products and will introduce new cakes and pastries that shall suit our customers’
everchanging tastes & preferences. Sweet Neighbor will operate and deliver freshly-
baked products to its market within the area at 8:00 am until 11:30 pm from Monday to
Saturday. Sweet Neighbor’s entire servitude and transactions will adhere to the
aforementioned schedule.

Bakery items are an important part of the food service sector. In 2017, bakery products
accounted for more than 15 percent of all items sold in the food service sector.

Home-baked cakes and goodies are the main product of Sweet Neighbor, and the
business values the quality of every product serving all customers with freshly-baked
products anytime of the day. To attract more customers, we will also offer varieties of
drinks and food to our clienteles.

Our Niche Market is the Middle Class of Young Adults, Middle Youth and Mid-Lifers.
Majority of them from Class C are curious, outgoing, adventurous, food lovers and have
a busy life style that gives the business an opportunity to enter the industry.

Sweet Neighbor will be selling its home-baked pastries, other confectionaries, food and
beverages at very basic, low-cost approach to marketing--nothing fancy, just the bare
minimum to keep prices low and attract a specific segment of the market that is
very price sensitive.

Sweet Neighbor's objectives include strong market share, sales and return on
investments. Our Sales Objectives are; To reconcile the start-up costs; monthly income
increases up to 40% and; the Middle Class are the chief consumers of the business.
Sweet Neighbor will rent a condo in BSA Twin Towers at Ortigas Center to operate its
office and bakery for fast delivery to our target customers.

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Business Description

The business is a relaunched micro enterprise of a home-baked goods in the Philippines

owned and managed by a family.

Sweet Neighbor’s primary products are cakes and goodies, but we will also offer varieties
of drinks and food to our clienteles. We will deliver and operate from 8:00 am until 11:30
pm at Ortigas Center, Metro Manila serving the market with fine, freshly-baked and
affordable products enjoyable for any special moments and grand celebrations.

Line of Business/Industry

1561 Baking of Perishable Bakery Products

5211 Retail in Non-Specialized Stores: Food, Beverages, Tobacco

Mission

Our mission is to deliver freshly baked goods to give life to an ordinary day or special
events at any moment and maintain the high quality trusted by our customers.

Vision

Sweet Neighbor envisions to be part of every Filipino’s special moments and celebrations.

Goals and Objectives

 To establish and operate physical stores/cafes around commercial areas in Metro

Manila.
 To be at the top-list of Philippine’s local bake shops.
 To cater big events and ceremonies.

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History

The home-baked cakes and pastries, a small business of the Consigo Family started
at the year of 2003 at a small townhouse in Cubao, Quezon City. The business was
inspired by the two little daughters of the family by their admiration to their mom’s
baking skills, plus, the positive responses of the relatives and closest friends of the
family about the chocolate cake, crinkles and cupcakes. Thus, the mother, Mrs.
Consigo started selling couple products with her relatives and bulk orders grew and
grew just within a few months.

Neighbors started knocking on door ordering boxes of cakes and pastries; family’s
friends and relatives order boxes of sweets for different occasions as giveaways
and/or birthday gifts. They would also sell these products within their offices as an
additional for their day to day income.

Today

Each members of the family have the profession and recognized skills that are
beneficial on operating and managing the baking business (see Managerial Plan). Also,
loyal customers and agents from the past still exist; the potential of the business to the
market is foreseeable.

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Description of Product and Service Offered

Sweet Neighbor’s is a home-based business of freshly-baked cakes and goodies,

operating from 8:00 am until 11:30 pm at Ortigas Center, Metro Manila. The business
delivers within the area at the said schedule because we are also appealing to the call
center agents, hospitals and to the nearby customers. The business will allow modes of
transactions like, made-to-order, walk-in customers and bulk buyers within the
neighborhood.

Cakes:
8’ x 6’ | 6’ x 6’
Matcha Cake
Oreo Cake
Chocolate Cake
Ube Cake

Pastries:

Cinnamon Roll

Chocolate chips

Red Velvet Cupcakes

Choco-orange Tart

Tiramisu Tart

Crème Puffs

Food and beverages will later be introduced.

Food:
Waffle Kebab, Salted egg custard steam bun, Sticky rice with mangoes

Beverages:
Virgin Cocktail, Fruits Juice and Lemongrass Iced Tea.

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Value Proposition

At Sweet Neighbor, we bring the sweet sensation of our home to yours. We will come to
serve you everywhere you are with the delightful taste fresh from the oven.

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Industry Analysis

 Large base of young consumers and rising GDP per capita levels makes
Philippines an attractive Bakery and Cereals market.
An increase in the size of the middle-class population coupled with a
growing disposable income and a large proportion of young consumers
will drive the demand for consumer packaged goods. The volume
consumption of Bakery and Cereals is forecast to grow from 349.2 Kg
million in 2014 to 429.6 Kg million in 2019.

 Filipino consumers are trading down to value for money products in the Bakery
and Cereals market

Increasing food inflation in Philippines has resulted in consumers trading

down to value for money products in the market. Filipino consumers are
price sensitive and are increasingly preferring such Bakery and Cereals
products that are of low cost.

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 Bread & Rolls is the leading category in terms of volume consumption of Bakery
and Cereals products in Philippines
 Cookies (Sweet Biscuits) is the largest category in terms of value in the Filipino
Bakery and Cereals market.

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 Chocolate Cookies segment will gain maximum share in the Cookies (Sweet
Biscuits) category during 2014-2019

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 Profiles of selected Grocery Retailers

 Artisanal Producers hold the dominant share in the Cakes, Pastries & Sweet Pies
and Bread & Rolls categories

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Comprehensive brief of the Philippines' Bakery & Cereals sector:

 The Bakery & Cereals market in the Philippines is forecast to register moderate
growth during 2013-2018 providing opportunities for manufacturers to innovate
and introduce new products in the market.
 Cookies (Sweet Biscuits) is the fastest-growing category and the overall market
is driven by the Cookies (Sweet Biscuits) Cakes Pastries & Sweet Pies and
Bread & Rolls categories.
 Increasing income levels urbanization and the busy lives of Filipino consumers
have led to the growth of Bakery & Cereal products.
 Hypermarkets & Supermarkets continue to be the preferred distribution channel
for Bakery & Cereal products followed by Food & drinks specialists.
 Healthy products convenient pack sizes and artisanal products will drive the
demand for Bakery & Cereals in the Philippines.

Opportunities and Threats in the Industry

The Philippine population is quickly becoming more urbanized, with expanding

employment in the business service sector. In contrast to many other Asian economies,
bakery products have a well established presence in the Philippine diet. Bakery items
are an important part of the food service sector. In 2017, bakery products accounted for
more than 15 percent of all items sold in the food service sector.

Innovation, however, is no longer limited to pastries, cakes or bread loaves as even the
popular local bread, pan de sal (salted bread), is being reinvented. The leading retail
chains and convenience store chains in the Philippines are Filipino owned and are
mostly concentrated in the NCR region.

Barriers to Entry
 Proliferation of many branches by the key players
 Entry of foreign brands

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Major Competitors

Red Ribbon

Market Served

 Professionals, Homemakers, Businessmen, Senior Citizens

 Mostly Upper Classes A, B and C

Strategies

Red Ribbon’s residential customers are a bit more upscale as the residents own
and rent in condominiums. Red Ribbon is geared towards bringing families and
friends together with its specialty cakes and products. The tag line of the
company is ‘Whatever the celebration, it’s more beautiful with a Red Ribbon.' ed
Ribbon is more on the Red Ribbon more expensive side as compared to
Goldilocks.

Goldilocks

Market Served

 Homemakers, Senior Citizens

 Caters more to the masses

Strategies

Goldilock’s caters to customers with special needs and wants by providing very
detailed customization per item ordered. The patron is able to choose the size of
their dish as well as the style, doneness, and ingredients. Targeting each
buyer’s individual tastes creates an atmosphere in which the patron gets exactly
what is wanted and leads to a greater purchase satisfaction. If the customer is
happy, they will continue to be your customer.

Goldilock’s caters to the 20-40 age range, business professional who has a
willingness to pay top dollar for atmosphere and image. By targeting this group,
higher product mark ups are actually preferred by the patron as a means of

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 elitism and segregation from less preferred company such as children. By
offering perfection in a trendy setting, Goldilock’s will attract the affluent,
discerning crowd that will perpetuate the restaurant’s trendy, up scale image and
perpetuate the marketing through this scene.

Overall Trends and Outlook for the Industry

Innovation remains vital for baked goods companies to address the need of consumers
for variety, which can be more pronounced in packaged food. The development of new
products is directed either towards creating something healthier or something better
tasting.

 Nine mega-trends that drive consumers and these can be broken down into 20
sub-trends.

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An Explanation of the Sub-trends

Explanation
Aspiration The trend towards consumers having more aspirational desires and wanting
this reflected in the products that they consume.
Beauty The trend towards consumers being increasingly interested in their beauty
and grooming and, as a result, seeking to achieve more of their beauty aims
and ambitions.
Better Value for Particularly important in the current economic environment, this trend
reflects growing consumer desire, particularly in Western economies, for
Money Better Value for Money from their purchases. This can cover not only trading
down to lower priced items, but also trading up to higher priced ones when
a consumer feels there is value in doing so.
Busy Lives Working hours are increasing for certain groups, but many consumers
similarly have increasingly Busy Lives as they attempt to juggle work, home
life, personal ambitions, and the desire to be close to friends and family. As
highlighted below, for this trend we also identify specific consumer groups.
Changing Age A socio-demographic trend, the age structures of many countries are
evolving, having a significant impact on the marketing landscape. It‟s not
Structures just the aging of populations in Western, developed countries either, the
rapid increase in younger generations in developing countries also
challenges pre-conceptions about who the main consumers for products are.
Changing Life Combined with altering age group dynamics, the marketing landscape is
altered in many countries as people increasingly delay settling down,
Structures marriage, and childbirth. The traditional pattern of life-stages is evolving
and, as a result, so are the sizes of these groups and their needs from CPG
purchases. As highlighted below, for this trend we also identify specific
consumer groups.
Connection Flexible labor markets, increased work and pleasure travel, Busy Lives and
the breakup of traditional family structures in many countries leaves many
people with a growing desire to rectify the downturn in the types of
personal connections those in previous generations had. Social networking,
growth in the desire to spend more time with family and friends, and the
desire to improve the quality of that time, are all manifestations of this
trend.
Ethics, Mconsumers are increasingly critical of the ethical and related credentials of
the products or services they buy, and the providers of them.
Responsibility &
Spirituality
Experience Many consumers are seeking to go beyond the “simple” act of owning and
consuming products and instead are seeking to attain greater value by
Seeking seeking products and services that somehow offer rewarding experiences.
This can take many forms and can be related to other trends. For example,
consuming a very high quality food or drink may not only satisfy a need for

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 quality, but the act of consumption itself may also have value as an
experience that will not soon be forgotten.
Fun & Enjoyment Many consumers, young and old, and not least in these challenging
economic times, are seeking additional fun and enjoyment and some will
often choose CPG products as a result of these needs.
Health The wider social effects of growing obesity rates and sedentary lifestyles
have led to growth in consumer concern about their own health and
impacted their willingness to choose products and services that might result
in health benefits.
Individualism In an age of mass consumerism, global brands, and rules and regulations,
many people often seek to express their individual identities, personalities,
needs, and wants when the opportunity arises. As a result, products and
services can tap into this trend by offering people ways of achieving these
desires.
Indulgence From little rewards to big ones, consumers are increasingly seeking ways in
which they can indulge their desires and achieve the “feel good” this can
create, even if only temporary.
Media Fragmentation of the Media may mean that any one Media outlets or
outlets‟ influence may be declining, but the growth of 24/7 Media access
from almost any location means that Media influence continues to extend
and increasingly shape consumers‟ habits – even if they are seeking to react
against Media trends.
New Gender This trend refers to the blurring of traditional gender roles and behaviors,
and is related to the changing nature of modern life for many people. From
Behaviors stay-at-home dads to career women, the old ways of doing things is
changing and with it so are people’s views of themselves, and therefore the
products and services that meet their needs.
Personal Space & The pace of modern life and all the demands it brings means that many
people are seeking to create their own “bubble” of space and time where
Time they are in control, can relax and unwind, and are free from the constant
flow of things to do, even if it is just for five minutes.
Quality Seeking This is the trend towards trading up to higher quality products and services,
even if in challenging economic times this is a “less of the best” approach.
Technology The pace of technological change (not just in communication, but in other
areas too) means many are keen to try out the latest that’s on offer and are
Uptake willing to experiment to gain the benefits, and, for some, be among the first
to experience them.
Trust Or often, a growing lack of it, is increasingly important and is also a very
broad trend. From the breakdown in trust in institutions, governments, and
companies, to concerns over specific ingredients in consumer goods, trust is
increasingly a major concern for consumers, and therefore marketers as
well.
Urbanization & Shifting patterns of urbanization as major economies develop and people
move to where the work is plays a role in fundamentally shaping people’s
Migration needs – especially when it comes to CPG purchases.

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 Trend 1: Busy Lives: On-the-go consumption will remain major motivational
factors in the Philippines’ Bakery and Cereals market
Key demographics to target
• Both Men and Women
• Aged 19-45+
• Urban & Rural
Key categories to target
• Breakfast Cereals
• Bread & Rolls
• Energy Bars
• Cereal Bars
• Morning Goods
• Savoury Biscuits
Rate at which the trend will evolve
• Fast
 Trend 2: Health: Whole wheat Breads with nutritive ingredients are in demand by
the health conscious Filipino consumers
Key demographics to target
• Both Men and Women
• Aged 19-65+
• Urban & Rural
Key categories to target
• All Categories
Rate at which the trend will evolve
• Fast
 Trend 3: Indulgence: Indulgence remains as a key motivation for Bakery
products such as Cakes, Pastries & Sweet Pies, Cookies, and Morning Goods

Key demographics to target

• Both Men and Women
• Aged 25-45+
• Urban
Key categories to target
 Cakes, pastries & Sweet Pies
 Cookies
 Bread & Rolls
 Cereal Bars
 Morning Goods
 Savoury Biscuits
Rate at which the trend will evolve
• Fast

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  Trend 4: Personal Space & Time: Filipinos reward themselves with products
such as Cakes, Muffins and Rolls during a busy day

Key demographics to target

• Both Men and Women
• Aged 19-45+
• Urban
Key categories to target
 Bread & Rolls
 Breakfast & Cereals
 Energy Bars
 Cereal Bars
 Morning Goods
 Savoury Biscuits
Rate at which the trend will evolve
• Fast

Target Market and Consumer Demographics

a. Demographics

o Age - Young Adults (18-29), Middle Youth (30-44) and Mid-Lifers (45-59),
currently employed.

o Family Unit – We will also appeal to families (young families) with children.

o Gender: We will target both sexes.

o Income – Based on the price of our products, the business will appeal to the

medium income individuals.

b. Psychographics

o Social Class: Class C and D (Middle Class or the “masa”)

o Personality: Curious, outgoing, innovator, creative, and adventurous

o Lifestyle: Trendsetter, students, young professionals, busy life, food lovers

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Market Niche

Our Niche Market is the Middle Class of Young Adults, Middle Youth and Mid-Lifers.
According to Philippine Daily inquirer there are some Class C that are immediately
sensitive to price and there are some who are not. Majority of them from Class C are
curious, outgoing, adventurous, food lovers and have a busy life style that gives the
business an opportunity to enter the industry.

Competitive Advantages

 Sweet Neighbor delivers products to its customers

 The business is still operating while some competitors are close, delivering
made-to-order cakes, pastries, foods and other drinks.

Impacts on its Success

The Sweet Neighbor will be able to establish cafes in Metro Manila having more chance
to offer innovative food for the mass market, and soon, the business will have a
reputable positioning in the baking and/or food industry in the Philippines.

Strengths

 The business has existing agents as bulk buyers to distribute/sell products.

 The member/s of the partnership have the credentials and skills for the type of
business to manage and operate.

Weaknesses

 Sweet Neighbor will not establish a physical store yet.

 Weak marketing approach due to the incurred barriers of promotions such as the
permit from administrators of the vicinity to be able to post ads and give off flyers.

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Opportunities

 Increasing income levels urbanization and the busy lives of Filipino consumers
have led their dependence to food deliveries
 Western style cookies, biscuits, and desserts are popular for the “merienda” and
for special occasions
 Higher cost of leading brands in the industry

Threats

 Proliferation of many branches by the key players

 Easy entry on the industry

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Management Plan

Form of Ownership: Partnership

Choice of Ownership Form : Partnership

 Leona Estanelle R. Consigo

 Ma. Gracia Gem R. Consigo

Industrial Partnership

 Mark Anthony Mopera

Organizational Structure/Chart

Partner 1/ Partner 2/ Partner 3/

(Chef) (Manager) (Accountant/
baker)

Baker

Delivery man/
Driver

Roles of Members of the Management Team

Since it is a family business, the family work team shall run it in full agility and
trust to ensure the success of the business. However, each position shall have
their major roles as follows:
 The Chef - direct preparation of all products. He/she will manage the cold
kitchen and hot kitchen.
 The Manager – direct preparation of raw materials, packaging and ensure time
delivery of the products. Marketing of all product lines shall be also her major
function;

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  The Baker – direct preparation of baked products. His/her top priority is the
cold kitchen and is only expected in the hot kitchen when asked to do so.
 Kitchen Helper – Main job is to bake and maintain the cleanliness of the
kitchen.
 Driver/ Delivery Man – Delivers the goods directly to the buyers.

Qualifications, experience and expertise

 Mark Anthony Mopera, as pastry chef; culinary graduate at Far Eastern

University
 Had an internship at

 Leona Estanelle R. Consigo, as Manager, a college graduating student, taking

up B.S. major in Entrepreneurship at San Beda University, Manila;
 Ma. Gracia Gem R. Consigo, who had taken baking courses at Heny Sison
Culinary School after retirement as Auditor of commercial bank in the
Philippines. With her passion on baking, she founded the home-based family
business of direct selling of cakes and pastries to offices thru relatives and
close friends, as middlemen/agent. From hobby, the business grew thru
“word-of-mounth”. But, the business had run from 2003 until 2006 only due to
offered employment as Accountant overseas.

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Marketing Plan

Overall Marketing Strategy

Sweet Neighbor will be selling its home-baked pastries, other confectionaries, food and
beverages at very basic, low-cost approach to marketing--nothing fancy, just the bare
minimum to keep prices low and attract a specific segment of the market that is
very price sensitive. The business will use different advertisement tools for marketing
and promotional exposure to raise consumers’ awareness, interest and desires to our
tasty treats. Services included are walk-in and made-to order transactions, bulk
purchasing and door-to-door1 delivery within the vicinity. These services are intended
for the convenience of our target market—the Working Class. The company will also
participate in business bazaars and host grand openings offering free sample of our
tasty treats that will be beneficial for the company’s standing and growth.

Product:

Home-baked cakes and goodies are the main product of Sweet Neighbor, and the
business values the quality of every product serving all customers with freshly-baked
products anytime of the day. To protect the quality of our business, Sweet Neighbor is
committed to proper sanitation, quality of ingredients, and we will ensure that all cakes
and other goodies are properly baked. Innovations are guaranteed as an important
factor for the success of the business to maintain the competitiveness and sustainability
of the bakery to the industry.

To attract more customers, will start from offering its renowned products to new
creations and developed flavors and decorations of baked goods for all kinds of
occasions and Holidays in the Philippines. We will also accept special orders and
customizations from our customers. Soon, Sweet Neighbor will later promote food such

1
Door-to-door delivery:
1. Going to or making appeals at residences, as when selling or canvassing: a door-to-door sales representative.
2. Delivered directly from a store or business to a residence: promised door-to-door delivery.

door-to-door. (n.d.) American Heritage® Dictionary of the English Language, Fifth Edition. (2011). Retrieved
November 30 2017 from

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as Wrapped Tortilla, Sandwich Clubhouse, Waffle Kebab and beverages like Thai Iced
tea, Virgin Cocktail, Coffee and Chocolate drink.

Pricing:

Sweet Neighbor's objectives include strong market share, sales and return on
investments. We will take a very basic, low-cost approach to marketing--nothing fancy,
just the bare minimum to keep prices low and attract a specific segment of
the market that is very price sensitive. The company will choose prices which are
competitive with the industry. Our prices on the first year will be offered at a low rate but
not being immensely below the market price.

Place:

Sweet Neighbor will rent a condo in BSA Twin Towers at Ortigas Center to operate its
office and bakery for fast delivery to our target customers. We are also aiming every
neighboring tenant at the said place. This may still change if we could find another
cheaper condo unit, but our location will still be around Ortigas Center.

Promotion:

Sweet Neighbor will raise consumers’ awareness, interest and desires to different
strategies of promotion. The most common marketing strategy for this industry is
through referrals or word of mouth. On the first months of operation, we will take use of
Social Media advertisement, leaflets, posters and text messages. We will also
participate in business bazaars and host grand openings offering free sample of our
tasty treats. The business will have promos and coupons to elicit our consumers’
interests. We will also put surprises to our packaging in different occasions, holidays
and even in ordinary days.

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Sales Management, Sales Planning, Sales Approach, Sales Force

Sweet Neighbor’s Sales Objectives: To reconcile the start-up costs.

Monthly Income increases up to 40%

Middle Class are the main buyers.

The owners will accumulate wholesalers from areas which business industry is
predominant e.g. Metro Manila. Sweet Neighbor will deliver to our working customers
within the companies and we will allow walk-in customers within the neighborhood.

• Agents (Wholesalers)
• Deliveries Sales

• Flyers
• Social Media Ads
• Referrals
• Word of Mouth

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Comments and Suggestions

The comments and suggestions directly stated by the customers through text, call, chat
and personal conversations. The following comments and suggestions below are the
factors we need for Product Development:

1. Ang mahal – too expensive

2. Hindi nagmomoist – the cake was dry
Ms. Gail Rimpola
3. Masyadong matamis – too sweet
Ms. Guia Palmero
4. Ang panget ng items sa picture – not appetizing publications
Eriane Roi Lingon
5. San po ang menu? – where’s the menu?
Marietta Bermundo
6. Gusto ko sana may caramel sa ibabaw and flakey (crème puffs) – crystalized
caramel on top and flakey bread (crème puffs)
Ms. Gail Rimpola

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Financial Plan

Possible Sources of Initial Financing

The family business requires a start-up cost of P150,000.00. The owners shall
invest P50,000.00 and the balance of P100,000.00 shall be a bank loan payable in
one year
The financial statements for one year projected has been prepared. By the end of
a year operations, the loan from the bank is fully repaid.

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Sales Forecast (12 Months)
Sweet Neighbour

Fiscal Year Begins January

12-month Sales Forecast

Annual
January February March April May June July August September October November December Totals
Pastries units sold 2,000 2,100 2,205 2,315 2,431 2,553 2,680 2,814 2,955 3,103 3,258 4,072 32,486
Sale price @ unit 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00
Pastries TOTAL 200,000 210,000 220,500 231,525 243,101 255,256 268,019 281,420 295,491 310,266 325,779 407,224 3,248,581

Cupcakes units sold 100 105 110 116 122 128 134 141 148 155 163 204 1,624
Sale price @ unit 200.00 200.00 200.00 200.00 200.00 200.00 200.00 200.00 200.00 200.00 200.00 200.00
Cupcakes TOTAL 20,000 21,000 22,050 23,153 24,310 25,526 26,802 28,142 29,549 31,027 32,578 40,722 324,858

Cakes sold 40 42 44 46 49 51 54 56 59 62 65 81 650

Sale price @ unit 450.00 450.00 450.00 450.00 450.00 450.00 450.00 450.00 450.00 450.00 450.00 450.00
Cakes TOTAL 18,000 18,900 19,845 20,837 21,879 22,973 24,122 25,328 26,594 27,924 29,320 36,650 292,372

Snacks sold 100 105 110 116 122 128 134 141 148 155 163 204 1,624
Sale price @ unit 70.00 70.00 70.00 70.00 70.00 70.00 70.00 70.00 70.00 70.00 70.00 70.00
Snacks TOTAL 7,000 7,350 7,718 8,103 8,509 8,934 9,381 9,850 10,342 10,859 11,402 14,253 113,700

Drinks sold 200 210 221 232 243 255 268 281 295 310 326 407 3,249
Sale price @ unit 40.00 40.00 40.00 40.00 40.00 40.00 40.00 40.00 40.00 40.00 40.00 40.00
Drinks TOTAL 8,000 8,400 8,820 9,261 9,724 10,210 10,721 11,257 11,820 12,411 13,031 16,289 129,943

Monthly totals:
253,000 265,650 278,933 292,879 307,523 322,899 339,044 355,996 373,796 392,486 412,110 515,138 4,109,455
Revenue

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Pro Forma Cash Flow
Statement
Sweet
Neighbour
Annual
January February March April May June July August September October November December Totals

Opening balance
300,000.00 256,550.00 329,527.50 407,153.88 489,661.57 577,294.65 670,309.38 628,974.85 733,573.59 844,402.27 961,772.38 1,086,011.00
Sales
253,000.00 265,650.00 278,932.50 292,879.13 307,523.08 322,899.24 339,044.20 355,996.41 373,796.23 392,486.04 412,110.34 515,137.93 4,109,455.08
Total received
253,000.00 265,650.00 278,932.50 292,879.13 307,523.08 322,899.24 339,044.20 355,996.41 373,796.23 392,486.04 412,110.34 515,137.93 4,109,455.08

Purchases
63,250.00 66,412.50 69,733.13 73,219.78 76,880.77 80,724.81 84,761.05 88,999.10 93,449.06 98,121.51 103,027.59 148,784.48 1,047,363.77
Manpower & other
direct costs 88,550.00 92,977.50 97,626.38 102,507.69 107,633.08 113,014.73 118,665.47 124,598.74 130,828.68 137,370.11 144,238.62 180,298.27 1,438,309.28
Operating costs
12,650.00 13,282.50 13,946.63 14,643.96 15,376.15 16,144.96 16,952.21 17,799.82 18,689.81 19,624.30 20,605.52 25,756.90 205,472.75
Fixed assets
125,000.00 60,000.00 185,000.00
Proceeds of loan
(200,000.00) (200,000.00)
Payment of loan
20,000.00 20,000.00 20,000.00 20,000.00 20,000.00 20,000.00 20,000.00 20,000.00 20,000.00 20,000.00 20,000.00 20,000.00 240,000.00
Motorcycles
80,000.00 80,000.00 160,000.00
Deposits and start
up costs 107,000.00 107,000.00
Total cash
payments 296,450.00 192,672.50 201,306.13 210,371.43 219,890.00 229,884.50 380,378.73 251,397.66 262,967.55 275,115.93 287,871.72 374,839.65 3,183,145.80
Cash
increase/(decrease) (43,450.00) 72,977.50 77,626.38 82,507.69 87,633.08 93,014.73 (41,334.53) 104,598.74 110,828.68 117,370.11 124,238.62 140,298.27 926,309.28
Closing balance
256,550.00 329,527.50 407,153.88 489,661.57 577,294.65 670,309.38 628,974.85 733,573.59 844,402.27 961,772.38 1,086,011.00 1,226,309.28

30
 ASSETS LIABILITIES
CAPITAL

Cash Accounts payable 200,000.00

300,000.00 125,000.00 240,000.00 100,000.00 897,851.03

200,000.00 80,000.00 200,000.00 loan

1,097,851.03
50,000.00

140,000.00

240,000.00 300,000.00 Sales 1,381,309.28

60,000.00 4,109,455.08 1,401,309.28

Tax payable
(20,000.01)
483,458.25

Cost of sales

2,465,673.05 20,000.00

500,000.00 395,000.00

105,000.00

31
 Operating expenes

Fixed assets 57,000.00

125,000.00 205,472.75

80,000.00
Tax
60,000.00
483,458.25
80,000.00

345,000.00

Inventory

20,000.00

Deposits

50,000.00

32
Capital Outlay

Kitchen Equipment
Item Qty

Oven 2 68,000.00

Mixer 1 27,000.00

Refrigerator 1 30,000.00

Utensils 10,000.00

135,000.00
Furniture & fixtures

Tables 25,000.00

Shelves 25,000.00

50,000.00

33
Projected Income
Statement
Sweet
Neighbour

Annual
January February March April May June July August September October November December Totals

Sales
253,000.00 265,650.00 278,932.50 292,879.13 307,523.08 322,899.24 339,044.20 355,996.41 373,796.23 392,486.04 412,110.34 515,137.93 4,109,455.08
Cost of sales

Ingredients &
packaging (25%) 63,250.00 66,412.50 69,733.13 73,219.78 76,880.77 80,724.81 84,761.05 88,999.10 93,449.06 98,121.51 103,027.59 128,784.48 1,027,363.77
Manpower
(15%) 37,950.00 39,847.50 41,839.88 43,931.87 46,128.46 48,434.89 50,856.63 53,399.46 56,069.43 58,872.91 61,816.55 77,270.69 616,418.26
Delivery cost
(5%) 12,650.00 13,282.50 13,946.63 14,643.96 15,376.15 16,144.96 16,952.21 17,799.82 18,689.81 19,624.30 20,605.52 25,756.90 205,472.75
Other direct cost
(15%) 37,950.00 39,847.50 41,839.88 43,931.87 46,128.46 48,434.89 50,856.63 53,399.46 56,069.43 58,872.91 61,816.55 77,270.69 616,418.26
Monthly totals:
Cost of goods sold 151,800.00 159,390.00 167,359.50 175,727.48 184,513.85 193,739.54 203,426.52 213,597.84 224,277.74 235,491.62 247,266.20 309,082.76 2,465,673.05
60% 60% 60% 60% 60% 60% 60% 60% 60% 60% 60% 60% 60%

Gross profit
101,200.00 106,260.00 111,573.00 117,151.65 123,009.23 129,159.69 135,617.68 142,398.56 149,518.49 156,994.42 164,844.14 206,055.17 1,643,782.03
40% 40% 40% 40% 40% 40% 40% 40% 40% 40% 40% 40% 40%

Operating costs
12,650.00 13,282.50 13,946.63 14,643.96 15,376.15 16,144.96 16,952.21 17,799.82 18,689.81 19,624.30 20,605.52 25,756.90 205,472.75
Start up cost
57,000.00
Net profit before tax
31,550.00 92,977.50 97,626.38 102,507.69 107,633.08 113,014.73 118,665.47 124,598.74 130,828.68 137,370.11 144,238.62 180,298.27 1,381,309.28

Tax (estimate) @35%

483,458.25
Net profit after tax
897,851.03

Assumption
Discount
(wholesale) 25%

34
Product Costing

Ingredients Cost

Pastries Crinkles Flour 5.00

Egg 5.00
Butter 5.00
Sugar 3.00
Cocoa 3.00
Baking powder/vanilla 1.00

Packaging 3.00 25.00

Butterscotch Flour 5.00
Butter 5.00
Sugar 2.00
Nuts 4.00
Egg 5.00
Baking powder 1.00

Packaging 3.00 25.00

Cappucino
bars Flour 5.00
Chocochips 4.00
Sugar 2.00

35
 Coffee 1.00
Eggs 5.00
Butter/margarine 4.00
Vanilla 0.50
Baking soda/powder 0.50

Packaging 3.00 25.00

Sansrival Eggs 9.00

Cashew nuts 5.00

Sugar 2.00

Butter 5.00

Cream of tartar 0.50

Vanilla 0.50

Packaging 3.00 25.00

Cupcakes Choco Flour 8.00

Sugar 4.00

Egg 9.00

Butter 5.00

Milk 4.00

Cocoa 5.00

36
 Baking soda/powder 1.00

Vanilla 1.00

Icing 6.00

Packaging 7.00 50.00

Cakes Custard Eggs 20.00

Cake flour 5.00

Sugar 10.00

Milk 40.00

Macapuno (garnish) 20.00

Baking powder/vanilla 2.50

Packaging 15.00 112.50

Moist choco Eggs 10.00

Cake flour 5.00

Sugar 5.00

Milk 5.00

37
 Butter 10.00

Cocoa powder 15.00

Icing (cocoa/milk/sugar) 45.00

Baking powder/vanilla 2.50

Packaging 15.00 112.50

Fluffy cheesecake
Cream
cheese 58.00

Milk 5.00

Butter 10.00

Sugar 5.00

Flour 5.00

Eggs 12.00
Lemon
juice 1.00

Vanilla 0.50
Cream of
tartar 1.00

Packaging 15.00 112.50

Snacks Waffle kebab
Pancake
recipe 3.00

38
 Bacon 6.00

Cucumber 1.00

Cheese 2.00

Tomatoes 0.50

Packaging 5.00 17.50

Salted egg custard steam bun

Flour 3.00

Sugar 2.00

Shortening 0.50
yeast/food
coloring 0.50

Egg yolk 3.50

Milk
powder 1.00
Custard
powder 1.00
Milk
(liquid) 1.00

Packaging 5.00 17.50

Sticky rice with mangoes

Glutinous rice 3.00

Sugar 2.00

39
 Coconut milk 2.50

Mangoes 5.00

Packaging 5.00 17.50

Drinks Lemongrass iced tea

Lemongrass 3.00

Sugar 1.00

Lemon 1.00

Honey 2.00

Packaging 3.00 10.00

Virgin cocktail Lime juice 1.00

Mint leaves 2.00

Apple juice 3.00

Sugar syrup 1.00

Packaging 3.00 10.00

Fruits juice Any fruits in season 6.00

Sugar syrup 1.00

Packaging 3.00 10.00

40
Assets

Cash 1,226,309.28

Inventory 20,000.00

Deposits 50,000.00

Kitchen equipment 135,000.00

Furniture & fixtures 50,000.00

Motorcycles 160,000.00

Total assets 1,641,309.28

Liabilties and Equity

Loan payable 60,000.00

Provision for income tax 483,458.25

Total liabilites 543,458.25

Capital 200,000.00

Net income 897,851.03

Total equity 1,097,851.03

Total liabilties and owners equity 1,641,309.28 -

41
Break even point
Sweet Neighbour
For the year ended 31 December
Sales forecast Break even

Total sales 4,109,455.08 513,681.88

Less: Cost of sales (2,465,673.05) (308,209.13)

Gross profit 1,643,782.03 205,472.75

Gross profit rate 40% 40%
Less: Total operating
costs (205,472.75) (205,472.75)

Break even sales 513,681.88 ** 0.00

** this is the total annual sales required to break even

=Total operating costs ÷ gross
profit rate

42