BUSINESS PLAN

Executive Summary
Mbeya is among of the southern highlands regions in Tanzania. The region has eight districts which are Mbeya municipal, Mbeya rural, Mbarali, Ileje, Kyela, Rungwe, Mbozi and Chunya district. The region is bounded by Iringa region in southern east, Rukwa in northern west and Tabora and Singida regions in northern part. Other than the regions surrounding the region it is bordered by countries like Malawi and Zambia.
The region has a good climate and is suitable for agricultural activities, industrial and livestock. Among the food crops that are produced in abundance are maize, rice, beans and wheat, the cash crops are coffee and tea in small quantities. Due to this good climatic condition and high production of different crops, many people find Mbeya a good place to live and establish their businesses. The population of Mbeya city is high. Due to this high population of the city there are so many challenges that are facing the city and the people living within the city. Among the challenges is a poor planning of the city which has contributed to high congestion of the habitats and the poor provision of the social services. Also in some areas there are no conducive environments for healthy life for instance poor infrastructures of sewerage system and waste management.
We are Mbeya Bakery & Cakes, an innovative retail is establishment in Mbeya City, we produce and service grant high-end quality baked goods in modern and creative way. We ell fresh baked breads and Cakes made from the highest grade of ingredients, filling the Mbeya city area’s need for a classic bakery that will make our business stand out in the baked goods industry is our drive to let the customers be inspired through their own designed creations.
We aim to offer its products at a competitive price to meet the demand of the middle- to higher income local market area residents, while increasing the number of people enjoying the health benefits of a higher baked goods.
Our business plan is focusing on provision of baked goods that has been prepared in good and health environments particularly of wheat floor. Recently people are used to go to retails shops which are located in places with quality of breads, loafs, and cakes. Most of the shops selling these products with high and many people find themselves hard in getting something for breakfast in their homes. So our plan is to establish a bakery which will cater all these weaknesses.
Another reason for starting this business is to increase the value of products of wheat floor when sold in other regions. In recent years may bakery have been producing these but due to restriction of government in exporting the products to neighboring countries, many bakery have been facing the difficulties in selling the goods, most of them have been selling their products at late times. Due to this problem in marketing, we find it necessary engaging in bakery in order to provide good products and by so doing our income also will be raised.
The targeted market for our product is Mbeya city, in the long run we are planning to reach other regions like Iringa, Tabora, Morogoro, Dar es Salaam and the neighboring countries like Malawi and Zambia.
As new entrepreneurs we are planning to operate the industry by use of the skills and knowledge acquired at the college. The skills available in our team are indicated below against each member of the team;
 Mandela James. B Eng.Mech (MUST)
 Nyakiro Said. BBA (MUST)
 Kasain Nunu. B Eng. Mech (MUST)
 Mashauri William. BBA (MUST)
 Robert E kway. BBA (MUST)
 Raufu Athuman. BBA (MUST)
 Mandela Humphrey. B Eng. Mech (MUST)
In starting this industry the estimated budget for the project is analyzed below;
Infrastructures
 Buildings Tzs   8,000,000.00
 Machinery Tzs  12,000,000.00
Operational budget Tzs 15,000,000.00
Total budget Tzs 35,000,000.00
The team is planning to get the above amount partly from individual sources whereby each partner will contribute Tzs 5,000,000.00 which amounts to Tzs 25,000,000.00. The remaining amount, Tzs 10,000,000.00 will be lent from Financial
Business Description
Our primary focus is on the quality of the baked goods and incorporating creativity. This will be the biggest different between our current competitors and us. By using hand held tables locked into tables on location, our customers will have a chance to use their own imaginations and combine it with our skilled bakers to make their cakes and breads a reality. With a program we hope to have designed, our tables will provide a fun interactive way to make the customers fell as though they played an important role in the process of making some of our products for whatever their reasons may be.
A goal of ours is that the company/ shop will have a more modern feel and keep up with the technology that is always advancing around us. This includes both in-store technology such as our register and design stations with tables, and outside the store technology with the website that we hope to create. Our website will provide an organized way to order and design cakes or breads from homes, similarly to the program on the in- store tables. The online site will provide potential customers with an easy way to place orders as well as show them what our bakery is all about. Mbeya Bakery & Cakes would like to make our customers feel as though they play a part in the bakery and the process of making their creations and we feel that the technology that we incorporate can help us do that. The fact that we would incorporate so much technology and have a more modern style not only separates us from the competition in the town of Mbeya city, but also sets us apart from other bakeries in the city. Also our product will be packaged, labeled and branded consistent with the regulatory requirements for food.
Mission Statement
Our aim is to provide bring unique confectionary products and services to Mbeya and the greater community by retailing and wholesaling tasty treats. Our Bakery is a confectionary company dedicated to providing high- quality desserts to a variety of customers. We concentrate on the high-end market of products as we maintain the focused differentiator strategic position in other industries. Our products are priced higher and predicated on quality of inputs, exceptional flavor and taste, unique design and customer service. We maintain a friendly, creative, and fair working environment that welcomes diversity, hard work, and new ideas. We intend to generate profit to provide a fair return for our investors and to expand the business into other surrounding communities.
Vision Statement
In the future we intend to adapt through marketing and technology to sustain our modern edge to be as customer- friendly as possible and provide the best products in our field, also to be greater producer of quality bread and cakes in and outside of Mbeya region.
Objectives of our business
 To provide the highest quality product with proper ingredients.
 To provide a competitive price and maximize sales so as to get profit.
 To create employment chase hence improvement of standard of living of the people.
 To reduce import of bread and Cakes in the region as well as country.
 To increase customer satisfaction.
 To enable buyer and local customers to become self-income generating and sustaining.
Core Values:
Service: we work hard to provide an inviting environment for our customers and serve them in the best and most efficient way possible.
Sustainability: we wish to use technology to connect with the people of the advancing times, working with our customers to produce their own inspired creations and update as the technology around us advances.
Product (Services)
The business will be lucrative business in Mbeya city and outside. The bakery provides freshly prepares cakes, bakery and pastry at all time 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. The product will be sells in 1 kilogram loaves of multigrain bread to all of its customers. The bread is typically found in the bakery section of each store, displayed on racks along with other fresh and packaged bread products. While there are many bread products sold on racks, this product is distinguished by the fact that it is the only true multigrain bread sold in whole loaves, and further, by the branding and health claims carried on the package. For regulatory reasons, there is no other bread product that is allowed to advertise the health benefits of multigrain in the same way.
This multigrain bread is in the premium category but we expect to be able to sell it for a higher price than other premium breads as a result of its good taste and its health benefits.
Products are made from all natural ingredients, obtained from a distributor who specializes in natural and organic products. Ingredients are available in ample quantity however prices fluctuate seasonally. Hedging strategies will be employed to ensure that changes in the cost of our raw materials will not affect the prices we charge to our customers.
Market analysis
Mbeya Bakery & Cakes product will concern with quality product according to the demand and the nature of population. The analysis of the market will concern with;
Market needs.
The demand of the bread and cakes in Mbeya area seems to be greater according to the number of customer’s/ population of people in the city, so our business will produce more products in order to satisfy the needs and will ensure access of both adequate and quality breads and cakes service based on quality of various segments of the society.
The market segment.
Our business market consist of the people of Mbeya region and as well as other region nearby Mbeya city like Iringa, Rukwa, Njombe and Morogoro all these could be easy delivered goods and services from our business due to enough capacity of production also in order to emphasize more business to be targeted and segmented into the following customer structure out of 100% sales turnover.
The competitive trends and reaction.
There are some other retail bakeries in Mbeya or the surrounding towns to be in competition with our business, however these bakeries are; Waljis Bakery, Family loaf bakery, Furaha Bakery and Mbeya kitchen/bakery all sell baked goods items. These are big Bakery’s greatest competitors. Fortunately, the strengths of these bakeries are all the same and typical of commercial food product businesses, allowing our bakery to more easily stand out. Companies are characterized by three major traits: price, quality, and service. Waljis Bakery, Family loaf bakery, Furaha Bakery and Mbeya kitchen/bakery   all focus on low prices and some service. In contrast, our bakery would value higher quality baked goods and personal service. Our prices may be slightly affordable, but our products would be from better quality of ingredients and would still be very reasonable priced for the industry.  The major weakness of our bakery has when stacked against these bakery is convenience. Our products would be fresher and of higher quality, thus superior to the goods of these mass produced ‘bakeries’,
Targeted Market
Our target customers mainly consist of the higher income consumers, and the top of the middle class. Although this is a smaller group of consumers to appeal to, we hope to position our-self as a business in Kabwe town area or along the market of Mwanjelwa where there is easy access to our selected consumers. We expect our customers to be of the working class, people with steady jobs, and possibly families.
Challenges
In order to survive in an ever-changing marketplace, our bakery wholesalers and retailers must adapt to challenges faced by the industry. This might mean coping with widely fluctuating food and fuel prices by using futures products to hedge against losses, or dealing with a saturated and consolidating market where large supermarkets are producing in-house products, increasing competition. Small bakeries, unless they automate or provide some other distinct value to their customers, may find that they cannot compete with larger bakeries and their economies of scale.
Trends
By capitalizing on trends in consumer tastes, bakeries of all sizes can increase their margins and stay in business. Small companies can cater to people's desire for handcrafted artisanal products and thus build a recognizable niche that larger operations would have a hard time replicating. Bakeries can make use of par-baked products to cut down on baking time, or appeal to growing demand for organic products by applying for certification. Small steps like these can swing the industry currents in a bakery's favor.
Management Team Plan
Mbeya bakery and cakes will be a general partnership between Mandela J. James, Nyakiro Said, Kasaini Nunu, Mashauri S. William, Raufu Athuman, Mandela Humphrey and Robert E. Kway, who will also acts as operators. All seven partners will share equal ownership of the company. A general partnership was deemed the best form of ownership for the company’s needs.
      Mandela James wills acts as the Chief Executive Officer and will manage and assist in the baking. Mr. Mandela James is organized, confident, and persistent. He has experience in sales and customer service from his past employment experience. Because of his hard working and very motivated personality he strives to maintain a solid and stable working environment for himself and the employees under him. With his previous design experience and powerful initiate, he hopes to put the Mbeya bakery and cakes out there to the public and make it the best that it can be.
         Mandela Humphrey and Nyakiro Said will function as the Chief Marketing Officers and also act as the primary baker and cake designer for the business. Along with our abilities in baking and design, Mr. Humphrey and Ms. Said have a strong work ethic, great social skills and a lot of training and experience in leadership.
         Kasaini Nunu will function as the Chief Financial Officer with assistant of Raufu Athuman which will take a series of financial of the company.
         Mashauri S. William will function as Information Technology Officer which will handle the website and technological aspects of the facility and dealing with the advertisement of the products of the company.
         Robert E. Kway will function as maintenance engineer and also will maintain all the facilities and equipment of the company in order to make the equipment to be available for the production due to increase the profit of the company.
         Some help will be needed in opening our business. We will hire some assistants for baking and serving customers that will work part time. They will be paid minimum wage.
In addition to the reputation of the bakery building, the site is also furnished with the large second-hand equipment needed the operation of. Therefore, it is unnecessary to purchase the large and expensive machinery.

Marketing Strategies (Plan)
Market Research.
Our business will be admirable for us due to that after making the research   for the products we discovered that our plan indicates that the business will be profitable to enable it to declare of profit at least 65%-75% in every year from 2014-2018.  The financial system indicates a situation where by all the cash obligation will meet as and when they arise.
Market Mix.
The business of Bakery and Cakes will attracts many customers’ of Mbeya city and other customer apart from Mbeya city due to that our product will contains high quality of ingredients with different design of products and others
• Price of product will be affordable to all local population and other classic customers due to the quality and appearance of the product.
• Location of business, Mbeya Bakery and Cakes will be located at Kabwe in the Mbeya city along the Mwanjelwa Market and station which is accessible in all form of major communication and infrastructure such as international road and others.
Advertising and Promotion strategies
Advertising Expense:
We are expecting to advertise our business thrice (three times) each week which will cost Tshs.30, 000/=Word of mouth and public perception are immensely important in both aspects of the business. First of all, customers must understand that our products are made with quality ingredients and thus taste better than many of our competitors. The word of mouth will be created when someone experiences for example, a cake at a part. The cake will be enjoyed by many and thus the word of mouth seed for the bakery aspect of the portion will be created.
Our business will be advertising in newspaper, website, trade shows and other auction places. This advertisement will provide Mbeya Bakery and Cakes to be jump-start in business. In addition, several times a month Mbeya Bakery and Cakes will place an ad in the paper. These ads will be strategically placed in areas such as the engagement and wedding page during the wedding season. A well laid out and user friendly webpage is important for the growth Mbeya bakery and Cakes. The site will include detailed descriptions of the products, photos of goods, a description of the company and its philosophy, and contact information to raise awareness of the bakery. In addition, the website will include information on the upcoming classes offered with detailed descriptions of each class and photos of the cakes.
Our wholesale customers will be promoting and advertising our product brand in order to develop further business for themselves. The advertisement will occur in their store through their menu, display case, Mbeya bakery and Cakes logo, etc. Also, when our wholesale customers advertise publicly, it is to their advantage and ours to mention that they sell Mbeya bakery and cakes products.
Suppliers and Distribution Strategies
In order to support our country businesses, it is important that we purchase ingredients grown in our country whenever possible. We solely use wheat flour that has been produced to our country in order to improve the economic growth of the country. The products are distributed in various ways. The retails products may be picked up at the retail location by the customer from the bakery. The wholesale products will be delivered to the wholesale locations with the fee included in the product pricing.
Operational and Management plan

Product's price
Item Price
Breads Small 1,000
Big 1,800
Loafs 200
Cakes Cupcake 500
6inch 300
8inch 5,000
wedding 20,000
The following financial statements, provide detailed financial for Mbeya Bakery & Cakes. These projections are based on best estimates of future financial performance.


Income Statement
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total
Sales Revenue    144,000,000    144,000,000    188,901,600    197,921,700   193,250,000   188,901,600    200,480,000    197,921,700    193,250,000       200,480,000      193,250,000       200,480,000           2,242,836,600
Cost of Goods Sold    112,250,300      91,080,300    110,100,900    115,800,000   105,500,500   100,655,500    108,450,000    102,988,500      96,758,840         99,851,678        90,010,050         89,670,000           1,223,116,568
Gross Profit      31,749,700      52,919,700      78,800,700      82,121,700     87,749,500     88,246,100      92,030,000      94,933,200      96,491,160       100,628,322      103,239,950       110,810,000           1,019,720,032
Gross Profit % of revenue 22.05% 36.75% 41.72% 41.49% 45.41% 46.72% 45.90% 47.97% 49.93% 50.19% 53.42% 55.27% 44.73%


Expenses
Salary 51,100,000 51,100,000 51,100,000 51,100,000 51,100,000 51,100,000 51,100,000 51,100,000 51,100,000 51,100,000 51,100,000 51,100,000 613,200,000
Depreciation 200,000 200,000 200,000 200,000 200,000 200,000 200,000 200,000 200,000 200,000 200,000 200,000 2,400,000
Advertising 840,000 840,000 840,000 840,000 840,000 840,000 840,000 840,000 840,000 840,000 840,000 840,000 10,080,000
Legal and Professional Fees 50,000 0 50,000 0 50,000 0 50,000 0 50,000 0 50,000 0 300,000
Insurance 500,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 3,800,000
Store Expenses 675,000 500,000 500,000 350,000 500,000 350,000 500,000 300,000 400,000 500,000 350,000 500,000 5,425,000
Lease 250,000 250,000 250,000 250,000 250,000 250,000 250,000 250,000 250,000 250,000 250,000 250,000 3,000,000
Utilities 3,325,000 3,325,000 2,900,000 2,750,000 2,630,000 2,000,000 2,500,000 3,325,000 3,325,000 3,325,000 3,000,000 3,000,000 35,405,000
Miscellaneous 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 12,000,000

Total G & A Expenses 57,940,000 57,515,000 57,140,000 56,790,000 56,870,000 56,040,000 56,740,000 57,315,000 57,465,000 57,515,000 57,090,000 114,605,000 743,025,000
Income Tax 13%        7,532,200        7,476,950        7,428,200        7,382,700       7,393,100       7,285,200        7,376,200        7,450,950        7,470,450           7,476,950          7,421,700         14,898,650                96,593,250


Income before interest      50,407,800      50,038,050      49,711,800      49,407,300     49,476,900     48,754,800      49,363,800      49,864,050      49,994,550         50,038,050        49,668,300         99,706,350              646,431,750
interest expenses 11,000,000 11,000,000 11,000,000 11,000,000 11,000,000 11,000,000 11,000,000 11,000,000 11,000,000 11,000,000 11,000,000 11,000,000              132,000,000

Net income      39,407,800      39,038,050      38,711,800      38,407,300     38,476,900     37,754,800      38,363,800      38,864,050      38,994,550         39,038,050        38,668,300         88,706,350              514,431,750




Balance Sheet
Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec
Current Assets:
Cash and Cash equivalent 200,000,000 199,000,000             197,000,000 195,000,000 196,600,000 189,000,000 190,000,000 193,000,000 198,500,000 200,000,000 205,000,000 210,000,000
Inventory 700,000 710,000 720,000 730,000 740,000 750,000 760,000 770,000 780,000 790,000 800,000 810,000
Total curent assets 200,700,000 199,710,000             197,720,000 195,730,000 197,340,000 189,750,000 190,760,000 193,770,000 199,280,000 200,790,000 205,800,000 210,810,000


Fixed Assets:
Property, plant, and equipment 62,487,680 62,487,680 62,487,680 62,487,680 62,487,680 62,487,680 62,487,680 62,487,680 62,487,680 62,487,680 62,487,680 62,487,680
Less: Accumulated depreciation 212,800 425,600 638,400 851,200 1,064,000 1,276,800 1,489,600 1,702,400 1,915,200 2,128,00 2,340,800 2,553,600
total long term assets 62,700,480 62,913,280 63,126,080 63,338,880 63,551,680 63,764,480 63,977,280 64,190,080 64,402,880 62,487,680 64,828,480 65,041,280
Total assets 263,400,480 262,623,280             260,846,080 259,068,880 260,891,680 253,514,480 254,737,280 257,960,080 263,682,880 263,277,680 270,628,480 275,851,280



Current Liabilities:



Accounts payable 700,000 710,000 720,000 730,000 740,000 750,000 760,000 770,000 780,000 790,000 800,000 810,000
Current Portion Long-Term Debt                                     1,210,000 1,210,000 1,210,000 1,210,000 1,210,000 1,210,000 1,210,000 1,210,000 1,210,000 1,210,000 1,210,000 1,210,000
Total Current Liabilities 1,910,000 1,920,000 1,930,000 1,940,000 1,950,000 1,960,000 1,970,000 1,980,000 1,990,000 2,000,000 2,010,000 2,020,000
Long term Liabilities
Loan payable 11,000,000 11,000,000 11,000,000 11,000,000 11,000,000 11,000,000 11,000,000 11,000,000 11,000,000 11,000,000 11,000,000 11,000,000
Total  liabilities 12,910,000 12,920,000 12,930,000 12,940,000 12,950,000 12,960,000 12,970,000 12,980,000 12,990,000 13,000,000 13,010,000 13,020,000
 Equity
Capital stock ( shares outstanding) 270,000,000 272,000,000 277,000,000 283,000,000 288,500,000 293,000,000 295,500,000 298,800,000 302,000,000 305,000,000 308,000,000 310,000,000
Earnings                 19,509,520             22,296,720               29,083,920              36,871,120                40,558,320              52,445,520                   53,732,720              53,819,920             51,307,120                 54,722,320                  50,381,520              47,168,720
Total Equity               250,490,480           249,703,280             247,916,080            246,128,880              247,941,680            240,554,480                 241,767,280            244,980,080           250,692,880               250,277,680                257,618,480            262,831,280
Total Liabilities & Equity               263,400,480           262,623,280             260,846,080            259,068,880              260,891,680            253,514,480                 254,737,280            257,960,080           263,682,880               263,277,680                270,628,480            275,851,280

Cash flow
Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec Total
Operating Activities
Net Income                                                       39,407,800 39,038,050 38,711,800 38,407,300 38,476,900 37,754,800 38,363,800 38,864,050 38,994,550 39,038,050 38,668,300 88,706,350 514,431,750
Depreciation 200,000 200,000 200,000 200,000 200,000 200,000 200,000 200,000 200,000 200,000 200,000 200,000 2,400,000
Changes in Unearned Income                           256,098 545,873 353,463 298,208 373,908 574,242 521,215 123,421 522,095 678,523 682,522 721,532 516,831,750
Changes in Payable       0 100,000 50,000 400,000 450,000 300,000 250,000 100,000 400,000 345,000 100,000 578,000           3,073,000
Net Cash from Op. Activities 39,863,898 39,883,923 39,315,263 39,305,508 39,500,808 38,829,042 39,335,015 39,287,471 40,116,645 40,261,573 39,650,822 90,205,882 525,555,850
Financing Activities
Owner Investment 310,000,000 310,000,000 620,000,000
Long Term Debt 100,000,000 100,000,000 100,000,000 100,000,000 100,000,000 100,000,000 100,000,000 100,000,000 100,000,000 100,000,000 100,000,000 100,000,000 1,200,000,000
Monthly Loan Payment                                       -11,000,000 -11,000,000 -11,000,000 -11,000,000 -11,000,000 -11,000,000 -11,000,000 -11,000,000 -11,000,000 -11,000,000 -11,000,000 -11,000,000 -132,000,000
Net Cash from Fin. Activities 399,000,000 89,000,000 89,000,000 89,000,000 89,000,000 89,000,000 89,000,000 89,000,000 89,000,000 89,000,000 89,000,000 399,000,000 1,688,000,000
Investing
Capital Investments   210,000,000 210,000,000 420,000,000
Net Cash from Inv. Activities                       210,000,000 0 0 0 0 0 0 0 0 0 0 210,000,000 420,000,000
Increase/(Decrease) in Cash 3,235,352 -8,523,232 85,523,252 23,435,532 -57,090,000 12,568,088 -45,878,099 1,414,678 79,897,676 -6,676,600 2,244,265 -33,098,000 57,052,912
 Cash at Beginning of Period                                       0 210,000,000 200,000,000 129,000,000 150,000,000 75,000,000 130,000,000 56,000,000 23,000,000 34,000,000 45,000,000 0    1,052,000,000
Cash at End of Period                                       3,235,352 201,476,768 285,523,252 152,435,532 92,910,000 87,568,088 84,121,901 57,414,678 102,897,676 27,323,400 47,244,265 -33,098,000 1,109,052,912