Cake Pops
Business Plan:
A business plan is a written document that describes in detail how a business, usually a new one, is going to
achieve its goals. A business plan lays out a written plan from a marketing, financial and operational viewpoint.
Sometimes, a business plan is prepared for an established business that is moving in a new direction.
We select cake pops as our product to start a new venture. Firstly, we start with small enterprise then we enter in
the large market or in an industry.
1. Executive Summary:
2. Product/Service Feasibility Analysis:
It is an assessment of the overall appeal of the product or service being proposed. There are many
important things to consider when launching a new venture, nothing else matter if the product or service
itself doesnt sell.
2.1.Components of product/service feasibility analysis:
a) Product/service desirability
b) Product/service demand
2.1.1. Product/service desirability:
The first component of product/service feasibility is to affirm that the proposed product or service is
desirable and serves a need in the marketplace. To check the desirability of the customers we use a
test which is concept test.
2.1.1.1.Concept Test:
It involves showing a preliminary description of a product or service idea, to industry experts and
prospective customers to solicit their feedback. It is a one page document that includes the short
description of the product, benefits of the product and brief description of companys management.
2.1.2. Product/Service Demand:
The second component of product/service feasibility analysis is to determine if there is demand fr the
product or service. There are two techniques for making this determination:
i. Buying Intention Survey
ii. Library, Internet and Gumshoe Research
2.1.2.1.Buying Intention Survey:
A buying intention survey is an instrument that is used to gauge customer interest in a product or
service. It consist of a concept statement or a similar description of a product or service with a short
survey attached.
2.1.2.2.Library, Internet and Gumshoe Research:
The second way to assess demand for a product or service idea is by conducting library, internet and
gumshoe research. You have to accumulate evidence that there will be healthy demand for your
product or service. You can get evidence from these three researches.
3. Industry or Target Market Feasibility Analysis:
Industry or target market feasibility analysis is an assessment of the overall appeal of the industry and
target market for the product or service being proposed. There is distinct difference between a firms
industry and its target market. An Industry is a group of firms producing a similar product or service. A
firms Target Market is the limited portion of the industry that it goes after or to which it wants to appeal.
3.1.Components of Industry or Target Market Feasibility Analysis:
a) Industry Attractiveness
b) Target Market Attractiveness
3.1.1. Industry Attractiveness:
Industries vary in terms of their overall attractiveness. The most attractive industries are young rather
than old, early rather than late in their life cycle, and are fragmented rather than concentrated are more
receptive to new entrants.
3.1.2. Target Market Attractiveness:
A target market is a place within a larger market segment that represents a narrower group of customers
with similar needs. Most start-ups simply dont have the resources needed to participate in a broad
market, at least initially.
4. Organizational Feasibility Analysis:
Organizational feasibility analysis is conducted to determine whether a proposed business has sufficient
management expertise, organizational competence and resources to successfully launch its business.
4.1.Issues in Organizational Feasibility Analysis:
a) Management Prowess
b) Resource Sufficiency
4.1.1. Management Prowess:
A proposed business should evaluate the prowess or ability of its initial management team, whether it
is a sole entrepreneurship or a larger group. This tasks requires the individuals starting the firm to be
honest and candid in their self-assessments.
4.1.2. Resource Sufficiency:
The second area of organizational feasibility analysis is to determine whether the proposed venture
has or is capable of obtaining sufficient resources to move forward. The focus on organizational
feasibility analysis is on non-financial resources.
5. Financial Feasibility Analysis:
Financial feasibility analysis is the final component of a comprehensive feasibility analysis. For feasibility
analysis, a preliminary financial assessment is usually sufficient. More rigor at this point is typically not
required because the specifics of the business will inevitably evolve, making it impractical to spend a lot
of time early on preparing detailed financial forecasts.
5.1.Issues of Financial Feasibility Analysis:
a) Total Start-up Cash Needed
b) Financial Performance of Similar Businesses
c) Overall Financial Attractiveness of the proposed Venture
5.1.1. Total Start-up Cash Needed:
The first issue refers to the total cash needed to prepare the business to make its first sale. An actual
budget should be prepared that lists all the anticipated capital purchases and operating expenses needed
to get the business up and running. After determining a total figure, an explanation of where the money
will come from should be provided. We can get money from banks, friends and family.
5.1.2. Financial Performance of similar Businesses:
The second component of financial feasibility analysis is estimating a proposed start-ups potential
financial performance by comparing it to similar, already established businesses. Obviously, this effort
will result in approximate rather than exact numbers.
5.1.3. Overall Financial Attractiveness of the proposed venture:
A number of other factors are associated with evaluating the financial attractiveness of a proposed
venture. These evaluations are based primarily on a new ventures projected sales and rate of return.
At the feasibility analysis stage, the projected return is a judgment call. A more precise estimation can
be computed by preparing pro forma, financial statements including one to three year pro forma
statements of cash flow income statements, and balance sheets (along with accompanying financial
ratios).
6. Business Model:
Business model is firms plan or diagram for how it competes, uses its resources, structures relationships,
interfaces with customers, and creates value sustain itself on the basis of the profit it earns. There is no
standard business model, no hard and fast rules that dictate how a firm in a particular industry should
compete. In fact its dangerous for the entrepreneur launching a new venture can be successful by simply
copying the business model of another firm-even if that other firm is the industry leader.
7. Risks and Contingency Approach:
Risks analysis is a process performed to understand the nature of unwanted, negative consequences to
health and to identify and consider the options for preventing or minimizing the negative consequences.
The contingency approach is used by leaders who feel people, organizations and situations change over
time, and is the right way to address situations as a manager, because details change with each occasion.
This approach is outside of the classical management style, which applies a cookie-cutter approach to
every situation. The contingency approach is mainly used as part of organization theory and leadership
theory, both of which recognize a certain amount of uncertainty or dissatisfaction with traditional
leadership methods.
8. Social and Economic Benefits:
The direct and indirect economic effects of culture are measured by calculating expenditures by consumers
on culture goods and services, including purchases of consumer products or spending at activities that
charge fees. Economic effects can be studied through a culture satellite account, which allows for a more
detailed and replicable means of understanding the economic benefits of the final demand for culture.
Economic analysis can measure effects on domestic industries, on the production of specific types of
culture products, on trade, and on the occupations that benefit from spending on culture. Producers of
culture and artistic products benefit from knowledge of changing trends in consumption in order to
maintain and enhance their competitiveness in the global economy. Without the knowledge of the
audience or consumer demand, it is difficult to interpret emerging consumer needs, build new audiences
and boost sales, a very direct economic outcome.
In addition to measures of the economic impact of culture, the relationships between culture consumption
and civic participation, health and well-being, and social capital are also of enduring interest. The well-
being of an individual may be enhanced by the use of a culture good or service just as the use of the
product may also allow the consumer to become more proficient in the use of other culture products; this
is defined as an increase in human capital. Consumption of culture may give rise to the creation of bonds
among those who have consumed the same type of culture, also called social cohesion. Similarly, the
consumption of culture may create social capital, which represents the networks that strengthen
communities. In addition, many studies have linked economic and social benefits by suggesting that
significant social benefits, such as a sense of national identity or "connectedness," ensue from culture,
ultimately resulting in indirect economic benefits.
Three basic effects are commonly ascribed to culture participation:
Intrinsic effects are inherent in the culture activity itself and are what make us seek out and want to
consume culture products, e.g. a sonata entertains and delights. The value of intrinsic effects is captured
only partially by the market through the price of their related commercial transactions (the sale of a book
or a ticket, or TV commercials).
Instrumental effects are useful by-products from culture activity that accrue to the participant, such as
music used as therapy for the emotionally disturbed or engagement in culture activities that may keep a
troubled youth out of jail. The culture product, in this case, is not used for its own sake; rather it is used
to achieve some unrelated goal. Instrumental effects can be subject to a cost-benefit calculus concerning
return on investment to determine their value in comparison with other methods to achieve the same ends
(e.g., drugs, tutoring).
Functional effects reflect how culture can function to sustain and develop society. These effects include,
for example, fostering civic participation, contributing to community development, forming and retaining
identity, building social cohesion, modifying values and preferences for collective choice, and enhancing
collective understanding and the capacity for collective action. These effects, called externalities by
economists, are not captured by the marketplace.
