NORTH DISTRICT 5

S.Y. 2017-2018

REGINO MERCADO NIGHT HIGH SCHOOL

Panganiban Street, Cebu City

First Semester

BUSINESS PLAN FOR

YUM YUM PASTRIES

Regino Mercado Night HS, Grade 11 Room

MRS. ZENITHA M. ZAPANTA

ENTREPRENEURSHIP

PREPARED BY:

Daniel Nacorda
Neil Matthew Quirante
Joathan Malinao
Arnel Monsalud
Vinom Cube Papas
 Section 1
EXECUTIVE SUMMARY

Yum Yum Pastries (YYP) is a company in Regino Mercado Night High

School, serving both students and teachers with delicious snacks. Established in
July 2017, the business is operating through serving delicious and affordable
snacks. The company seeks to expand business by opening a production area in
other year levels, and expand the existing business into a school-wide production.

Yum Yum Pastries offers freshly baked products such as cakes, cookies,
cupcakes and pastries, as well as sandwiches, and salads along with beverages.
With the opening of the business, we will be able to offer a full-fledged menu with a
variety of snacks every day.

Daniel Nacorda, is the founder of Yum Yum Pastries. Daniel has an

experience in the industry having taught and learned through his self-competence
and responsibilities. Daniel prides himself on his supreme customer service and
greeting everyone with a smile. With such immense experience and connections,
Yum Yum Pastries is sure to gain traction in the community.

The business was started by groups' funds. It plans to fund its expansion
through a contribution of each member. The funds are mainly required to open a
production unit and expand the existing business. The initial growth of the company
from the time of opening till midAugust is positive. The company has seen a lot of
customers as well as many snacks opportunities.
 Section 2
PRODUCT AND SERVICE DESCRIPTION

2.1 Service

The business is owned and managed by five young men and who had previous
experience in the Food Industry by their previous grade level.

Daniel Nacorda, CEO

Manages the financial aspect
Helps in daily menu decision
Coordinates and manage the business

Arnel Monsalud, Advertising Officer

Helps in advertising and marketing the business
Helps in daily menu decision

Neil Matthew Quirante, Finance Manager

Manages the sales and marketing
Chief decorator of the goods
Helps in daily menu decision

Joathan Malinao
Vinom Cube Papas
Janice Tura

2.2 Company Overview

Yum Yum Pastries is a start-up business that was launched in July 2017 at Regino
Mercado Night High School. This business will serve a community of both students
and teachers from the surrounding businesses and markets attending the nearby
place.

The company is a traditional retailing bakery, retailing a small variety of cakes,

cupcakes and cookies, sized to customer requirements. The company specializes in
selling delicious and affordable cakes, cupcakes and cookies for various type of
market. All our products are prepared fresh everyday with locally grown ingredients.

The company is registered as a general partnership with eight partners who will be
jointly and severally liable for the debts of the company with their entire property.

The company plans to expand operations and business by increasing the current
production with a wide-varieties . This plan covers all aspects with respect to the
expanded business.
Mission Statement
To provide our customers a recipes with a modern twist to satisfy the taste buds of
the previous, current and the future generations with a dash of excellence, a pinch of
quality and a scoop of creativity by a team of passionate individuals.

Vision Statement
To be the best friendly neighbourhood company with a vision to become the
reference for best re-seller of pastries around which our neighbors gather to
celebrate all their lifetime events or just in the mood to have a sweet treat.

Objectives
1. To establish a wide-business.
2. To develop a strong presence in the community needed to support sales goals.
3. To develop a full menu by the end of the last quarter.
4. To expand production to increase corporate customer sales.

2.3 Company Locations and Facilities

Yum Yum Pastries is currently located in Regino Mercado Night High School, very
close to establishments and businesses. This serves as one of the best location for
a business as it attracts a lot of students and adults as well as employees from
companies around. The business is strategically located, bringing in a lot of people
who visit hospitals or attend events at the nearby gymnasium.

We will convert our existing location to a complete store front as we have identified a
seller for another bakery site where we plan to move our operations.

Section 3
PRODUCTS AND SERVICES

3.1 Product and Service Description

Corporate Customers:
Baked Foods Cakes, Cupcakes, Cookies, Brownies, Breads, Savory snacks

Storefront customers:
Baked Foods Cakes, Cupcakes, cookies, brownies, pastries
Freshly prepared Sandwiches, Salads and Soups
 Beverages (hot and cold)
Special Orders (big orders)

Yum Yum Pastries will focus on snacks serving from a customer base of teachers,
students and visitors.

Our brand has become reputed in the local area because of our ability to provide a
good balance between health and taste at reasonable prices. Our expanded
business will continue its commitment to healthy foods, and differentiated products
using unique traditional recipes from around the world.

3.2 Product

Section 4
MARKET ANALYSIS

4.1 Market Overview

Facts about the Bakery Industry

The bakery industry in the Philippines includes 2,800 commercial bakeries with
annual revenue of 30 billion, along with 6,000 retail bakeries with total annual
revenue of 3 billion.

The commercial side of the industry is highly concentrated, with the 50 largest
companies generating 75% of revenue. On the other hand, the retail side is highly
fragmented, with the 50 largest companies generating around 15% of revenue. In
the retail industry, most companies operate just one facility. For companies of all
sizes, profitability is strongly tied to the efficiency of their operations. Large bakeries
are able to reach economies of scale advantages, while small bakeries can compete
by offering specialty goods and offering superior local services.
 Bakeries as share of Total Annual Revenue (Philippines)

26%
Retail
74% Commercial

4.2 Target Market Segmentation

There are 5 bakeries and stores within the 1--kilometer radius of Regino Mercado
Night HS.

We will cater to corporate clients within 1--kilometer radius so we can prepare just
in time to ensure fresh food.

We will cater to storefront and customers during non- class hours or break time
offering snacks. We will target teachers of school and students of educational
centers within a 1--mile radius. We also plan to attract customers who visit the
gymnasium nearby.

4.2.1 Market Segmentation & Demographic Profile

Regular Customers:
List of targeted customers for Yum Yum located in 1mile radius from YYP.
1. Teachers
2. Students

These are mainly customers who are positively be the regular customers. They are
both Men and Women between ages 1350 and who have an income range
approximately between 20,000.00 monthly for teachers and an allowance range
approximately 100.00 per day for the students.

Other Customers:
We have out- of- school customers who just want to enjoy a delicacy. We also have
clients wants to taste our delicious pastries.

4.2.2 Market Trends

Some important trends Yum Yum plans in adopting:

a. Consolidation: YYP will only be concentrating on expansion of its product lines.

b. Automation: Since YYP is a small operator it cannot afford to automate its
production right now.
c. Discounted Resale: This is the technique that YYP will be using in case of any
backlogs from its customers through flash sales.

4.2.3 Growth Potential & Opportunities

a. Artisan Breads: This opportunity is especially advantageous for smaller and

specialty re -sellers like YYP who have the ability to be flexible in their production
facilities and possess insights related to local tastes. YYP will try to adapt this
technique in their expansion plan.
b. Rising Popularity of Par-Baking: This is a way for smaller and re-sellers like
YYP to cut costs, while still providing fresh baked goods to their customers.
c. Increased Demand for Organic Foods: YYP will be targeting this segment of the
market during their expansion.
d. Shelf Lives Extended: YYP will also try to follow the new packaging techniques
to increase the shelf life of products during their expansion.
4.2.4 Barriers to Grow

a. Materials & Energy Costs: YYP faces a challenge in regards to its futures
contracts as there will always be a risk associated with changing prices.
b. Competition: YYP has around 10 bakeries in a close proximity of 5-kilometers
radius, Hence YYP faces a threat from competitors.
c. Low Demand Growth: As mentioned earlier since there are already quite a few
bakeries like YYP there is a very narrow window of growth for YYP.
d. Food & Drug Administration (FDA) Guidelines: It is mandatory to follow the
guidelines of FDA periodically and obtain their approval.
e. Appealing to Consumer Tastes: YYP will have to regularly conduct market
research in order to appeal to the current consumers tastes.

4.2.5 Measures to Overcome Barriers

a. Ability to pass on cost increases to the customer: YYP is planning to adopt

this technique to balance the increased costs depending on the changes in the
market conditions.
b. Close proximity to key markets: YYP is located in proximity of 5-10 kilometers
radius from all its customers. YYP will continue to maintain this during their
expansion too.
d. Product differentiation: YYP is planning to remain innovative in product to stand
out from the competition. YYP is planning to introduce new products lines like
Organic food during the expansion.

4.3 Competition
Competition in the local area is somewhat sparse and does not provide nearly the
level of product quality and customer service as YYP. Local customers are looking
for a high quality product. They desire a unique, classy experience.

List of 5 major competitors for YYP are:

Name of Business Location

1. Moonlit Bakeshop Panganiban St., Cebu City
2. Julies Bakeshop Panganiban St., Cebu City
3. Arbees Bakeshop Panganiban St., Cebu City
4. 7-Eleven Panganiban St., Cebu City
5. RMNHS Canteen Inside the School

4.3.1
 Section 5
STRATEGY AND IMPLEMENTATION
`
5.1 Overview

YumYum Pastries is hoping to be an active part of the community. It should be the

place where people want to go to share nice moments around delicious delicacies.
Moreover, we want our customers to think about our business for their lifetime
events. Therefore we need to give our customers the feeling that we are part of their
family and their daily life.

5.2 Positioning

Proposed Location
We will convert our existing location to a complete storefront
We have identified a seller for another bakery site where we plan to move our
production operations. This will be our main production unit (PU) for the bakery and
corporate customers.

Parking
Production unit needs basic parking access and loading/unloading zone
The current site for bakery has street parking and we expect teachers and students
to either walk or use available parking on streets.

5.3 Marketing Strategy

5.6 Milestones

Milestone Due Date

Starting of Implementation July 2017
Opening of the business August 2017

5.7 Operating Plan

5.7.1 Business Responsibilities of Proposed Site

The current store site in Regino Mercado Night High School, YYP will re-sell all
baked and prepared foods including breads, cupcakes, cookies, brownies, savory
snacks. YYP also handles procurement and delivery.
5.7.2 Quality Control

Food Quality
Food production follows written procedures
Employees are trained to strictly follow all processes
Current process does not include automation but when business grows,
automation will be explored

Food Safety & Hygiene

We follow all government regulations for food safety related to production and
handling
Pest control procedures reviewed monthly
Cleaning operations daily and sites inspected weekly

Service Quality
Area will be cleaned and maintained daily
Furniture/Fixtures checked everyday

Section 6
MANAGEMENT SUMMARY

6.1 Organizational Structure

Daniel Nacorda
(Finance Advisor &
Over-all Manager)

Arnel Monsalud Neil Matthew Quirante

(Advertising Officer) (Sales Marketing Officer)
6.2 Management Team

Daniel Nacorda is the co-owner of Yum Yum Pastries. He is educated with a

skills in Housekeeping Management and skills in Finance and cookery, with a
concentration in Entrepreneurship. He is currently studying at Regino
Mercado Night High School. Daniel has experience in student/public relations
through the Supreme Student Government. He acquired skills at SSG that are
transferable to the start-up of Yum Yum Pastries.

Neil Matthew Quirante is the co-owner of Yum Yum Pastries. He have skills at
Bread and Pastry and have the experience in Accounting & Business
Management strand.

Arnel Monsalud is the co-owner of Yum Yum Pastries, like Daniel he had the
skills in basic housekeeping management and skills in cookery, he is active in
social media that can be used to his advertising and promotion.

6.3 Management Team Gaps

The management team will have to partially rely upon outside suppliers for both
marketing and accounting functions.

The management team is still in the early stages of formation. Daniel Nacorda is
currently working as a finance advisor and over-all manager of the business to face
the business conflicts and problems.

Section 7
FINANCIAL PLAN
 This part shows the financial plan, projected cost revenue, projected revenue,
projected income statement, and cash flow.

7.1 Important Assumptions

Capitalization
Yum Yum Pastries, the initial capital is 1,040.00. There will be 8
members. Each of the members shall share 130.00.
Monthly Expenses
The table below shows our projected expenses per month during the
implementation of our operation based on our product.
Table 1: MONTHLY EXPENSES
FIXED COST JULY
Rental 0
Salaries: 0

(A)TOTAL FIXED COST 0

VARIABLE COST (Month)

Materials
Brownies 300
Mango Float 300
Cup Cakes 150
Puto Cheese 100
Telephone Bill ---
Electricity ---
Water ---
Transportation 50
Miscellaneous 50
(B)TOTAL VARIABLE COST 950
(A+B)TOTAL MONTHLY COST P 950.00 -
Table 1 shows the projected expenses this month during the initial month of
operation. It is noted that fixed cost is lower than the variable costs.
 7.2 Computation of Projected Cost and Revenue

Table 2: PROJECTED REVENUE

Projected Daily Projected Monthly Yearly

Types of Volume Revenue Volume Revenue Projected

Costing
Product/s Monthly Revenue
( C x PVD ( PVD x
Daily ) 30 ) ( DR x 30 ) ( MR x 12 )
C- 8 C- 96.00 C- 2,880.00 C- 34,560.00
Brownies M- 4.00 12 360
SP- 12.00 SP- 144.00 SP-4,320.00 SP-51,840.00
C- 8.00 C- 96.00 C- 2,880.00 C- 34,560.00
Mango
Float M- 4.00 12 360
SP- 12.00 SP- 144.00 SP-4,320.00 SP-51,840.00
C- 5.00 C- 50.00 C- 1,500.00 C- 18,000.00
Cup Cakes M- 2.00 10 300
SP-
SP- 7.00 SP- 70.00 2,100.00 SP- 25,200.00
C- 5.00 C- 50.00 C- 1,500.00 C- 18,000.00
Puto
Cheese M- 2.00 10 300
SP-
SP- 7.00 SP- 70.00 2,100.00 SP- 25,200.00
C- 292.00 C- 8,600.00 C- 105,120.00
Total 44 1320
SP
SP-428.00 12,840.00 SP-154,080.00
Legend: Cost - C Mark-up - M Selling Price SP

7.3 Break Even Analysis

Break Even Sales = Fixed Costs Gross Margin

Excluding beverages.

Averaged monthly fixed costs: 8,600.00

Average retail prices of each unit: 9.50

Break Even Unit = 905