THE BUSINESS PLAN

The Opportunity

Entrepreneurs recognize the opportunity and then turn it into a

successful business. So being an entrepreneur we study the market
with deep intensions to pick out the opportunities in the market. While
studying the market we find a great opportunity in the bread market.
And the opportunity is to introduce a new taste to the consumers of
bread as they are fed up of having same old taste.

The reason is as the time goes on the thing change with time to time
but the bread is still stuck with the old taste. So being entrepreneur we
found an opportunity gap here. Opportunity gap means a gap between
what is currently on the market and the possibility of a new or
significantly improved product, service or business that results from the
emerging trends. And the opportunity gap is to confer new taste to
bread
 Description of the business

How the proposed business solves the problem or fills

the need

The problem and issue that is to solve is to be is to vanish the old taste
of the bread. So in order to full fill this need we initially have small
surveys of different bakers to collect the consumer view about this.

Survey Report of bread consumers

Views
Questions Positive Negativ
e
Are you agreeing with same old taste? 36% 64%
Do you need new taste? 85% 15%
Is your bread nutritious? 45% 55%
Is your bread fatless? 35% 65%
Does it provide the same taste once it 23% 77%
opens?
So to solve all these issues we develop an idea of introducing multi
flavor bread for the convenient of consumers

The size of our opportunity is huge and the demand for it is excessive
and it is growing day by day. The change in people’s taste is the trend
which supports our idea.

Brief company history

Fruity bread was incorporated by three persons Hassan Javed, Ahmad

Ali and Muhammad Bilal. This idea was generated in the month of
March 2010. The formation of the business firm is partnership. The idea
of multi flavor bread was introduce for the first time in the market by
us. Initially we were three but later on two more members become the
part of our firm.

Mission Statement

“Fruity bread mission statement is to provide a product of the

greatest possible value to our customers, thereby gaining and holding
their respect and loyalty while achieving sufficient profit to finance
our business and it's growth”
Objectives

The objectives for fruity bread are:

 To establish the market presence needed to support marketing

and sales goals and to attract customers. 
 To reach Rs.30,000 monthly sales by the end of 2010, Rs.33,000
average monthly sales by the end of FY 2011. 
 To achieve profit margins over 10%. 
 To develop top-rated relationships with 2-4 well-respected, all
encompassing distributors.
 Prove to be a best idea generating and consultancy firm
 Terminate the old tastes and set up new tangs

Keys to Success

The keys to success in this business are:

 Marketing: promoting a new company, product, and delivery

channels to a rural community. 
 Product quality and consistency. 
 Pricing effectively with respect to the project quality and
customer value proposition.
 Management: products availability, costs controlled, marketing
budgets managed.  There is a temptation to fixate on growth at
the expense of profits.
  Reporting and controls in place for inventory and financials.
Competitive advantage

“Competitive advantage is a position a firm occupies against its

competitors.”

Our company has a great competitive advantage with respect to our

competitors. The reason is that the product of company as a huge
desire in the market. Although many breads are available in the market
but with same old taste but we are with the different one with new
taste and quality

Some of the potential competitive advantages to be considered are:

 Strong Competitive Advantages

The strongest competitive
advantage which we have is our patents, trademarks and copyrights
etc. The things which fruity bread possess is legal and registered with
government nothing is illegal. We have complete record of our
agreements with our customers and suppliers. Not even this but long
term contracts are preplanned with our customers and suppliers

 Credible Competitive Advantages

 It include our product and
management competitive advantage

 Cost
Fruity bread always tries to produce low cost product with
the good quality because quality is our ingredient

 Price
Fruity bread have great control over the price as we are the
first one in the market to produce multi flavor bread so we r the price
setter and we have complete control on price and our prices are
nominal

 Channels
Fruity bread has a huge list of distribution channels through
out the country who willing to do work with us.

 World Class Management

Fruity bread has a world class
management team which is working together as a single unit. We are
just like family and we believe that professional management puts the
company on the way to success.
Sustainable Competitive Advantage

 Fruity Bread Resources

 Our Capital structuring is based on 70% equity and 30% debts

 We have huge availability of raw material and good working
capital
 Management is the blood of our firm and we have qualified and
skilled management
 Intangible assets are patents trademarks and copyrights
 Qualified and experienced board of directors
 Highly skilled board of advisory

 Fruity Bread Capabilities

 Well developed, high-quality, accessible contacts that take years

to build
 Science and technology experts
 Supply chain experts
 Product/service design experts
 Sales & distribution channels
 Great sales and marketing
 Business Model

Demand Forecast
This is done by considering demands of customers. Our target
customers relates to:

 Elite class
 Upper Middle class
 Lower middle class

Raw Material
We buy milk from farmers located at different parts of the city
and eggs from poultry farm located near Raiwind Lahore. We
buy raw material from wholesalers as well.

Production
Our production is done at Fruity bread own state of the art
production plant.

Description of
Distribution channel
Business Model
 Wholesalers
 Retailers
 Hype Star
 Metro etc

Sales to customers
Selling products to the customers through retailers, wholesalers
and collecting feedback from customers.
Business model of fruity bread is traditional. We first of all analyze the
demand in the market. Through a survey we came to know that there is
a gap between the old and multi flavored bread. Then we collect
materials, as raw material will be purchase some of it from whole sale
markets in Lahore at very nominal prices with fine quality and from
farmers and poultry farm owners. After that we go to the next step
which is production process. The production of fruity bread is done at
its own state of the art production plant. The next step is to distribute
our product to the customer. Initially we are selling our product
through wholesalers and retailers. So, through these distribution
channels we sell our products and our marketing team and salesmen
will get the customer feedback which is used for the next demand
forecast.

Current Status and requirements

Our start-up costs come to approximately 100,000, which is mostly
renovation of the occupied office space, professional fees,
and expenses associated with starting our first head office.  The start-
up costs are to be financed by direct owner investment, financial
institutions, and private investors.  The assumptions are shown in the
following table and illustration.

Start-up Expenses  Amount (Rs)

Professional Fees (Legal, Accounting, Consulting) 1,800

Placemats, Stationery, Business Cards 1,100

Renovation 8,300

Marketing 2,500

Rent 2,000

Expensed Equipment 5,000

Insurance 350

Website Development 1,000

Misc Expense 3,800

Total Start-up Expenses 25,850

Product Life Cycle

Fruity Bread

The future prosperity of our business depends upon the following

important aspects:

 Our passion, desire and interest will play a key role in

moving towards success
 Management expertise and commitment to the business
 Sound strategies
 Close eye on the future competitors
 Good name recognition
 Increased quality and excellence of the services

We will give due care to these factors as they can be of vital

importance for our future survival.
Start-up Assets Amount (Rs)

Cash Required 23,100

Other Current Assets 5,250

Long-term Assets 20,300

Total Assets 54,650

Start-up Funding Amount (Rs)

Start-up Expenses to Fund 25,850

Start-up Assets to Fund 54,650

Total Funding Required 80,500

Assets   Amount (Rs)

Non-cash Assets from Start-up 31,550

Cash Requirements from Start-up 23,100

Additional Cash Raised 0

Cash Balance on Starting Date 23,100

Total Assets 54,650

 Liabilities and Capital

Liabilities Amount (Rs)

Current Borrowing 0

Long-term Liabilities 25,000

Accounts Payable (Outstanding Bills) 9,500

Other Current Liabilities (interest-free) 0

Total Liabilities 34,500

Capital     Amount (Rs)

Planned Investment

Investor 1 15,000

Owners 30,000

Additional Investment Requirement 1,000

Total Planned Investment 46,000

  

Loss at Start-up (Start-up Expenses) (Rs 25,850)

Total Capital (Rs 20,150)

 THE MANAGEMENT TEAM

Management Team

We are group of five individuals who are working on this project and
each person has the skill and ability required for this type of project.
Our team members their experience, ability and technical expertise are
discussed in detail below.
Mr. Hassan Javed (CEO)

Mr. Taimoor Alam (Vice President Finance)

Mr. Ahmad Ali (Vice President Marketing)

Mr. Muhammad Bilal (HR Manager)

Mr. Pirzada Asad (Vice President IT)

Management experience and Ability

Each member of our management team has a vast experience in the

relevant field

1. Mr.Hassan Javed

 He has a master degree in computer science and currently

doing MBA
 He has special interest in food industry and know lots of
important person in that industry personally
 He is also very well connected with government officials in
food department.
 Job Description
(Chief Executive Officer)

Job Title: Chief Executive

Reports To: Board Of Directors
Reported By: Job Analyst

Job Summary

This person is responsible for the overall management of the

organization. He/she is responsible of providing advices and support
to the middle management and enable them to make sound
decisions which help them to achieve business aims. Maintain and
develop existing and new business strategies.

Duties and responsibilities

 Management of the organization

 Developing strategies
 Analyzing the competitors
 Providing support to all the departments of the organization
 Analyze and classify the risk
 Supervision of all the departments
 Arrange meetings of board of directors and board of advisors
when needed
 Setting goals for the business with the help of middle
management
Other duties

 Help in recruiting the employees

 Making sure that all the departments are obeying the rules and
regulations of the business
 Making sure that the business partners are
 Assessment and evaluation of employees

Relationship

Within the organization this post maintain relationship with all

department

 Procurement department
 Human resource department
 Finance department
 IT department
 Production department
 Marketing and sales department

Required knowledge

Person should be holding a degree of MBA and should be having a

working experience of 5 to 10 years

 Excellent leadership coaching and mentoring abilities

 Demonstrated management skills
 Be highly competent
  Excellent interpersonal and communications skills
 Impeccable attention to detail
 Technically skilled; proficient in computer applications especially
in Microsoft Office.

2. Mr.Taimoor Alam

Mr.Taimoor is one of our directors and also serves as a vice

president of finance he looks after all of our firms financial matters

 He has a masters degree in accounts and currently doing MBA

 Worked in DAWN BREAD as their account officer for one year
 He is a very social person and has a vast network of friends in
hotel and tourism industry
 He possess excellent analytical and problem solving skill
 He also has a prior Entrepreneurial experience

Job Description
(Finance Manager)

Job Title: Finance Manager

Department: Finance
Reports To: Senior executive
Reported By: Job Analyst

Job Summary

Under the direction of senior executive develop and recommend

approved finance strategies, practices and policies that help to
achieve the company’s business and finance objectives.

Duties and responsibilities

 Ensue feasibility and internal consistency

 Avoid surprises means he should address what actions a firm
should take if something going seriously wrong
 Develop finance Strategies.
 Recommend Finance strategies.
 Make policies and practices that enhance investors and
shareholders commitment.
 Keep investors motivation.
 Achievement of organization goals.
 Develop solid Finance plan for business that will help in future
business needs.
 Work with the involvement of all necessary financial institutes or
organizations that can provide a financial plug.
 Keep an eye on all finance
Job characteristics

 Create solutions of complex business problems.

 Should have finance knowledge.
 Quickly adapt to different cultures and business conditions.
 Able to handle high stress situations successfully and to constantly work
under pressure in a complex and very competitive business environment.

Required knowledge

Person should holding the degree of MBA (finance)

 Trustworthiness and excellent interpersonal and communications

skills
 Impeccable attention to detail
 Strong leadership experience in budgeting, financial planning, and
analysis
 Demonstrated management skills
 A foundation in nonprofit accounting

3. Mr.Ahmad Ali

Mr.Ahmad is very talented person he is also one of our directors and

also serves as a vice president of marketing.
  Mr.Ahmad has done a Hotel management course from College Of
Tourism And Hotel Management (COTHM)
 He is also Doing MBA with specialization in marketing
 He is also operating his own private restaurant in Johar Town
Lahore
 He is well connected and possess complete knowledge about food
industry

Job Description
(Marketing Manager)

Job Title: Marketing Manager

Department: Marketing
Reports To: Senior executive
Reported By: Job Analyst

Job Summary

Under the direction of senior executive develop and recommend

approved Marketing strategies, practices and policies that help to
achieve the company’s business and marketing objectives.

Duties and responsibilities

 Develop Marketing Strategies.

 Recommend marketing strategies.
 Make policies and practices that enhance customer commitment.
 Customer motivation.
  Achievement of organization goals.
 Develop solid marketing plan for products.
 Work with the involvement of all necessary media to promote
product.

Job characteristics

 Create solutions of complex business problems.

 Should have experience in Marketing.
 Quickly adapt to different cultures and business conditions.
 Able to handle high stress situations successfully and to constantly
work under pressure in a complex and very competitive business
environment.

4. Mr.Muhammad Bilal
Mr.Bilal is a member of our firm’s board of directors .He is HR Manager
and as s board of director.

 He has done MBA from Lahore University Of Management

Sciences (LUMS)
 He is well connected with business community in Pakistan and
know persons which could provide financial assistance
 He got an international exposure with experience

Job Description
(Human Resource Manager)

JOB SUMMARY

Human Resource management is a key post to make

sound operational tasks of a business. This post decides the need of
human power to get targets of the business. This position requires both
strategic and technical skills. It demands a comprehensive control and
monitoring qualities on human force of the business. Main functions of
‘‘Human Resource Manager’’ is to hire new force, assign various duties,
make arrangements for training and to estimate future needs of labour
force.

Primary Responsibilities
Primary responsibilities of the ‘‘Human Resource Manager (HRM)’’ are;

 To hire, train and cut-off human force in the business.

 To plan labour strategy of the business.
 To check all the production operations of business.
 To train junior officers.
 To help in policy making and future strategies.
 To check the daily operations.
 To play active role in the preparation of annual report.
 To advise other departments in the formulation of their plans.

Decision Making Responsibilities

‘‘Human Resource Manager (HRM)’ suggests important decisions to

other departments to set various goals of the business. HRM chalk
out production polices on the recommendation of other
departments. ‘‘Human Resource Manager (HRM)’’ decides the
level of skills for the labour.

Relationships
 Following are the relationships of ‘‘Human Resource
Manager’’.
 Chief Executive Officer (CEO)
 Finance Manger
 Marketing Manager
 I.T Manager

Skills

Strong communicational, analytical, research, I.T and managerial

skills are the key requirements for this post.

5.Mr.Pirzada Asad

Mr.Asad is very hard working person and a member of our board of

directors. He is also the vice president IT.

 He has done MBA from University of Central Punjab

 Possess excellent Computer skill
 And has great problem solving skills

Job Description
 (Information Technology Manager)

Job Summary
 To manage the IT function on a day-to-day operational basis
 

Duties and Responsibilities


 To ensure maximum availability of computer systems throughout
the Company.
 Responsible for the provision of IT infrastructure services
including desktop applications, Local and / or Wide area networks,
IT security and telecommunications.
 Development and implementation of new systems.
 Working with senior management to propose, agree and deliver
IT service to defined Service Level Agreements.
 To manage the IT department include staff appraisals, disciplining,
pay reviews and career development.
 Responsible for IT hardware, software and maintenance
procurement.
 To develop and maintain a disaster recovery plan.
 To develop and control the IT security policy.
 To maintain and develop the company website.
 Provide a monthly written report to the IT Director on all aspects
of the IT Department.
 

Skills / Attributes Required

  Proven experience of managing an IT department.
 Experience in IT infrastructure planning and development.
 Experience of managing budgets in excess of £250,000 per
annum.
 Strong team leading skills.

Board Of Directors

Our board of directors consists of six members which are

Mr.Hassan Javed (Chairman of Board)

Mr.Taimoor Alam (Director)

Mr.Ahmad Ali (Director)

Mr.Muhammad Bilal (Director)

Mr.Pirzada Asad (Director)

Composition Of Board
Our firm has two types of directors

1. Internal Directors
2. External Directors

Internal Directors

Mr. Hassan Javed (CEO)

Mr. Taimoor Alam (Vice President Finance)

Mr. Ahmad Ali (Vice President Marketing)

Mr. Muhammad Bilal (HR Manager)

Mr. Pirzada Asad (Vice President IT)

External Directors

Mr. Adeel Shahzad

Board Of Advisors
Our board of advisor consists of three members who provide us
directions and advice on an ongoing basis the members of our board of
advisor are

1. Mr. Ali Asad

2. Mr. Naveed Nazir
3. Mr. Adil Javed
Mr.Ali and Mr.Naveed are in hotel industry where Mr.Adil is a quality
control manager in Bunny’s Bread. All three of them has long
experience in their relative field and help our management a lot in
solving problems and recognizing opportunities.

Professional Service Providers

 Lawyer
 Accounting Firm
 Business Consultant

Lawyer
 Our Firm has hired the services of an experienced lawyer Mr. Awais
Sohail who help us to solve any legal difficulties faced by our firm he
has also helped us in forming our firm he prepared the all necessary
documents required for it .He again provided his services in registering
our firm, its logo and any new idea generated by our firm.

Name and address of our firms lawyer is

Mr.Kashif Zia

Office Number,23-b Second floor Alfalah building Mall road Lahore.

Accounting Firm

As we have just started our firm we still don’t have a proper accounting
department but we are planning to have one within one year. Right
now we have hired the services of a well reputed Accounting Firm “T-
Accounts” who helps us maintain our accounts and financial
statements.

Best Way Accounting Firm

Office number 6-4a Sadiq Trade Center , Gulberg 3 Lahore.

Ph: 5853211

Mob: 03454323421

Business consultants

EZ solution is our consulting company which provides us valuable

information regarding our operational and structural problems.EZ
solution was established in 1978 as a construction advising
company and later expands its operations into other fields as well
and now has the mastery of providing consultancy to over 20
different fields.

Address: 542, H-block, DHA, Lahore

Organizational Structure
 CEO
Mr. Hassan Javed

Board of Directors
5 Members

Operational Manager Marketing Manager Finance Manager HR Manager IT Manager

Mr. Hassan Javed Mr. Ahmad Ali Mr. Taimoor Alam Mr. Muhammad Bilal Mr. Pirzada Asad

Middle Manager Middle Manager Treasurer Controller Middle Manager Middle Manager
Mr.Hussnain Naeem Mr. Hafeem Ahmad Mr. Salman Tariq Mr. Abdullah Mr. Tafzil Ahmad Mr. Sami-ullah

Operator
Advertising
Controller Of Operational Ativities & Promotion Officer
Cash Manager Tax Manager Chief Recruitor $ Selection Dept.
Mr. Wahab Ilyas Mr. Ali Fahad Mr. Usman Mughal Mr. Faisal AhmadMr. Sanaullah
Miss. Amna

Training and Compensation dept.

Maintainanc & Processing OfficerSales Dept Credit Manager Cost Accounting Manager
Mr.Aleem Mughal
Mr. Waris Khan Mr. Anas Ismail Mr.Shahzad Anwaar Miss. Ayesha Shaheen

Inventory Controller
Mr. M. Anwar
Description of organizational structure

Organizational structure consist of five partners which are actually

board of directors also, two limited partners and three general partners
who selects Mr. Hassan Javed as Chief Executive Officer as present in
chart. Other members of board of directors are also managing other
departments of organization as mentioned below:

Operational Manager

Mr. Hassan Javed

Marketing Manager

Mr. Ahmad Ali

Finance Manager

Mr. Taimoor Alam

HR Manager

Mr. Muhammad Bilal

IT Manager

Mr. Pirzada Asad

Below of these managers there are middle manager that are controlling
different sectors of the firm. There is hierarchical flow of relation
present from top to bottom.
In Operational Department
After the manager there is middle manager
Mr.Hussnain Naeem under which operational coordinators such as
controller of operational activities Mr.Wahab Ilyas, Maintenance &
processing officer Mr. Waris Khan and Inventory controller Mr.M.Anwar
lies.

In Marketing Sector
Under manager there is middle manager
Mr.Hafeem Ahmad present which passes information from bottom staff
to marketing manager. Under middle manager there is advertising and
promotional officer Mr. Ali Fahad who forecast the advertising and
promotional activities, and Sales department head Mr. Anas Ismail who
keep control on sales of the bread.

In Finance Sector
Mr. Taimoor Alam is the manager under which there
is Treasurer Mr. Salman Tariq and Controller Mr. Abdullah is present.
Under treasurer, there is cash manager Mr. Usman Mughal and Credit
manger Mr. Shahzad Anwaar is present. The function of cash manager
is to control the flow of cash and function of credit manager to keep
record of credit base activities such as credit sales and credit purchase
etc. Under controller there is tax manager Mr. Faisal Ahmad Who‘s
primary job is to deal with company’s income and sales tax issues, and
cost accounting manager Miss. Ayesha Shaheen who keep record of
cost management of bread.

In Human Resource department

Mr. Muhammad Bilal is the manager
under which there is middle manager Mr. Tafzil Ahmad. Under middle
manager there is chief recruiter and selection department head Mr.
Sana-ullah who deals with recruiting and selection of new employee
and Mr. Aleem Mughal who are in training and compensation
department who deals with new employee training and
compensational issues.

In Information Technology Department

Mr. Pirzada Asad is the
manager and Mr. Sami-ullah is middle manager under which Miss.
Amna is chief operator.
 Legal Structure

Legal form of organization

We follow partnership based business. A partnership is form of

business organization where two or more people pool their skills,
abilities and resources to run a business. Our business consist of five
partners, three partners are general partners and other two partners
are limited partners.

We have made our business legal through Partnership Agreement,

which is legal document that is similar to founder agreement. We
have made partnership agreement in such a way that if limited
partner will withdraw or dies partnership will not dissolve and on the
other hand, if one of the general partner dies or withdraw from
organization the partnership will be dissolved.

Ownership structure of the business

In this organization, all three general partners have equal power of

ownership in this business. They have major decision power for the
company. On the other hand, other two limited partners are not true
owners of business. They only served as investors and creditors to
the company and they have only concerned with profit and losses.
 Intellectual Property

FRUITY BREAD Name is registered

Logo is registered

Patents
Fruity bread has registered its process and product under the patents
ordinance 2000 and follows all the patent rules 2003 so according to this no
other firm is allowed to follow the same process and products used by
Fruity bread.

Trademarks
The logo, name and slogan of fruity bread are registered as a trademark.

Copy Rights
Fruity bread has registered under the copyright act 1962.
 Industry Analysis

“Industry analysis” is a business research that focuses on the potential

of an industry.

Industry Trends
Right now all of the bread industry is producing the similar type of
bread with same flavor and no new innovation has taken place in the
bread industry for the long time. There are only three types of bread
available in market

 Normal Bread
 Sugar Free Bread
 Milky Bread

These breads are available in three different sizes

 Small
 Medium
 Large
 Bread for Sandwiches

So the window of opportunity is very much open for our product

“Fruity Bread” which is multi flavored bread having different types of
flavors in single bread so with our new innovative product we have a
first mover advantage in the industry and with the strength of our
management team combined with the “Gourmets” name and trust
which people have on Gourmet we can capture the market.

Industry Size

Size of bread industry is very large as there are many different bread
producers in the country which produce the regular bread in the
country but few of them are producing it on large scale and have major
market share the rest of the bread industry consist of small bread
makers which usually don’t even have a name for their product these
small bakers usually operate in small villages and bread made by these
small producers is not even up to the standard maintained by branded
bread producers.

Few firms which have major share of the market are

 Dawn Bread
 Shezan
 Gourmet
 Cakes and Bakes
Industry Attractiveness

Bread industry is very attractive and its is growing phase as more and
more firms are entering into it but its window of opportunity is still
open as there is no producer of multi flavored bread so by introducing a
new innovative product such as multi flavored bread we can
“consolidate” the market as our surveys has shown that people will
love to have a bread which has different flavors.

Profit Potential

The industry has great profit potential generally the profit potential of
an industry depends on these forces

1. Threat of substitute
2. Threat of new entrants
3. rivalry among existing firms
4. bargaining power of suppliers
5. bargaining power of Buyers
 Threat of New
entrants

Bargaining Power of Rivalry among Bargaining Power of

Suppliers existing firms Buyers

Threat of
Substitutes

Threat of Substitutes

Our bread has no direct substitute because we are introducing new

bread in the market but as added measure we have our concept
registered.

Secondly the closet substitute our bread has is normal bread available
in market but price we are offering is very competitive and our quality
is also great so people will be more attracted toward our bread and
prefer it over normal bread.
Threat of new entrants

To avoid the threat of new entrants we have created some barriers to

entry the biggest of them is

Copy Right

As we are introducing a new product we have our idea registered

Other then copyright the significant barriers to entry which will be

created by us will be.

 Economies of Scale

As gourmet already have a vast network of branches and

distribution we can generate this barrier by doing mass
production which will result in lower average cost

 Product Differentiation

We will create this barrier by developing bread which is new

and different from breads which are already available in market
  Capital Requirement

Since gourmet is a established name and already invested a lot of

capital it will be difficult for new firm to enter in market with that
much capital

 First Mover Advantage

As we are making a first mover advantage we can gain name

recantation which will create a formidable barrier to entry.

 Management Team

Our management team is very skilled and has lot of experience in

the food industry which creates a sustainable barrier to entry

Rivalry Among Existing Firms

Rivalry among existing firms which are already competing in the

industry is high the firms which are already competing in the bread
industry are
  Dawn Bread
 Gourmet
 Cakes and Bakes
 Shezan

Bargaining Power of suppliers

Bargaining power of suppliers is low in this industry as raw material is

easily available and there are lots of suppliers

Bargaining Power of buyer

Bargaining power of buyer is low as the price of our product is already

very competitive and our product is different from our competitors.
Attractiveness Of Breads Industry Using Five Forces Model

Competitive Forces Threat to Industry

Low Medium High

Threat of substitute ●
Threat of new entrants ●
Rivalry among existing firms ●
Bargaining power of suppliers ●
Bargaining power of customers ●

Description of Target Market

Our target market is huge it consist of general public both in cites as

well as in villages because the trend in general public towards eating
bread during day and specially in morning is continuously increasing so
our target market is growing every day.

But we are specially targeting

1. Children
2. Hotels & Restaurants
Children
We are specially targeting school going children because usually
children get bored very quickly with same old bread with only one
flavor and mothers have lots of problem in feeding them in breakfast
this can be solved with multi flavored bread which has flavors like
mango, strawberry, chocolate etc which children love to have.

Hotels and Restaurants

We are also targeting hotels and restaurants and planed to supply them
our bread at discount price.

Competitive Analysis Grid for Gourmet

Name Gourmet Dawn Bunny’s Sona Cakes And
Bakers Bread Bread Bread Bakes

Unique
Product


Brand Name
Recognition


Access to
distribution 
channels
Quality Of
Product 

Price


Marketing
Support 

Quality of
Customer 
service
This competitive analysis grid shows us that gourmet has competitive
advantage over its competitors in unique product, Quality of product
and access to distribution channel this information can be used in
making firms marketing plan

Marketing Plan

Market is sea. Marketing plan of fruity bread is constructed after a deep

study of the market. Firstly we divide the market in different segments
so that we can collect pure information about our idea.

Market Segmentation

When selecting a target market, a company usually engages in some

form of market segmentation. This involves subdividing the market into
clear subsets of customers that act in the same way or that have
comparable needs. Fruity bread also divides the market in different
segments for the marketing plan.

Concept testing & Usability testing

To test our idea and product we make a soft launch of our product in
different areas and place stalls in front of bakery so that we get the
honest response of the customers. For concept testing we prepared
samples and distribute it in different areas such Defence, Model town,
Gulberg and Johar town. And for usability testing and a for quick
response we arrange stalls in front of bakeries.

To collect the customer response we prepared a small questionnaire

their results are given below

Questionnaire

Do you like the idea of multi flavor bread?

(a). yes (85%)

(b). no (15%)

How many flavors would u recommend?

(a). 5 (40 %)

(b). 4 (36 %)

(c). 3 (24 %)

How many sizes would u prefer?

(a). 3 (55 %)
(b). 2 (35 %)

(c). 1 (10 %)

Do you like the taste of flavor bread

(a). yes (80 %)

(b). no (20%)

Which flavor u like the most?

(a). Chocolate (45%)

(b). Mango (35%)

(c). Strawberry (20%)

Marketing Objectives

 Maintain positive, steady growth each quarter.

 Experience a growth in new customers who are turned into long-
term customers.
 Realize an increase in occupancy each subsequent year.

Marketing Mix
The fruity bread marketing mix is comprised of the
following approach to pricing, distribution, advertising and promotion.
Product Line
Fruity bread has designed a product line that will create
positive impressions in the leading market today. Products need to be
readily available to consumers and distinguishable from competitor’s
products. This plays a positive role in marketing our products, as the
tastes are unique. The key to this product line is promoting our new
product, the fruity bread. The unique product qualities include our
focus on both taste and hygiene factor.

Packaging

Fruity bread products are sold in stylish packaging, in order to

reflect the company’s ethical stance on environment. Fruity bread has a
great reliance on packaging of the product. The only essential feature
would be appropriate labeling and marking key benefits of proteins and
vitamins in the bread

Promotion

The promotional plan to be adopted by fruity bread, has two key

objectives. That is, gaining new product acceptance and increasing sales
for the company. Promotion of the fruity bread will mainly involve
above-the-line promotion techniques including advertising in
specialized industry journals and magazines, internet promotion and to
a more limited extent; television. Our focus on magazine advertisement
reflects a growing Pakistani trend, with 8 out of 10 Pakistani reading at
least one magazine, with readership increasing by 6.4% over the past
five years (Magazine Publishers of Pakistan, 2010). Combining this with
internet advertising will reflect a recent study which revealed natural
synergies between magazines and the internet (MPP, 2010).

Fruity bread will be adopting a product development strategy, in

relation to the promotion of the Fruity bread. This will involve targeting
an existing market of bread consumers, with a new and unique taste of
bread.

Placement

Fruity bread will be acting as a distribution channel to retail stores

and wholesalers initially in three Pakistani capital cities such as Lahore,
Karachi & Islamabad. These retail stores will consist of specialized
wheat products. Our intentions would be to expand distribution to
every state within two years. Our website will also allow for direct
sales.

The placement of the main warehouse is in the Lahore which will allow
distribution via both land and air. The fruity bread is relatively light and
small and so transport will be easily contractible.

Pricing
 By employing a cost-plus pricing strategy, the organization will be
earning fixed gross profit. This will also enable a better control of costs,
to ensure that manufacture of the Fruity bread does not exceed Rs35.
This price is derived from a development cost of Rs20 per unit and a
mark-up of 35%. This mark-up is based on rule-of-thumb mark-up
figures provided by The University of central Punjab

Almost half of survey participants indicated that the quality of the

product was of higher importance than the price or value of the good.
This suggests that the demand for the product is relatively inelastic. For
this reason, we have no hesitation in suggesting that the price of our
good reflects the willingness of consumers in our target market to buy.

Expected Market Share

We surveyed 100 peoples and asked them whether they would

purchase a Fruity bread, knowing the taste, quality and the price; 40%
said they would purchase it if it was available in very well known bakery
shops, 35% said they might buy one, 25% said Rs35 is too expensive
and the remaining 10% said they are not afraid of Fruity bread so
wouldn’t buy one, as illustrated below.
Market Share Survey

Would Purchase

Might Purchase

Won't Purchase

Not Afraid of Fruity

SWOT Analysis

Fruity bread is entering an industry as a sole producer of

flavored bread. As such, a myriad of opportunities lie in the fact that as
a first mover, there are no direct substitutes to compete against. The
key threat therefore, is the potential for competitors entering the
market. The development of strategic measures is the key to
manifesting the strength of having obtained a unique product concept.
However development will be required in terms of building
relationships with retailers and direct customers through research and
communication.
SWOT Analysis

STRENGTHS

1. DELIVERY
2. MARKETING
3. MANAGEMENT/INFORMATION
4. PROCUREMENT
5. COMMITMENT TO TECHNOLOGY
6. HUMAN CAPITAL
7. REPUTATION/ IMAGE
8. FINANCIAL POSITIONING

WEAKNESSES
1. HEALTH RISK
2. HEALTH CONSCIOUS SOCIETY
3. ATMOSPHERE (Dull)
4. NON MOTIVATIONAL EMPLOYEES
7. COMPACT LOCATIONS
9. AVAILABILITY

OPPORTUNITIES
1. INCREASE IN DEMAND FOR MULTI FLAVOUR
2 EASILY ACCESSIBLE
3. INCREASE IN POPULARITY
4. VALUE ADDED SERVICES (DELIVERY, DISC CARDS)
5. POSSIBILITY OF OFFERING MORE DIVERSIFIED MENU
6. CREATING INELASTIC DEMAND THRU ADVERTISEMENT
7. GROWTH IN OTHER CITIES
8 CATERING TO HEALTH CONSCIOUS PEOPLE
9. EASILY AVAILABLE TECHNOLOGY.

THREATS

1. STRENGTH OF COMPETITION
2.NOT ACCEPTABLE BY SOME PORTION OF SOCIETY
3. EMERGING NEW CHAINS
6. HEALTH RISK
7. DECLINE IN CONSUMER BUYING POWER
8. POLITICAL INSTABILITY
9. LOSING POTENTIAL CUSTOMERS DUE TO PRICE
 Target Market
The target market for fruity bread is children teenagers and adults as
well, who is part of a distinct segment

The geographical location of the market will initially be Lahore,

Islamabad and Karachi which each have over 4,000,000 people

The demographic of the market is approximately 45% male 55% female.

The psychographic qualities of the market are middle or upper class

citizens who hold quality in higher esteem than price.

Operating Expenses

The annual operating expenses necessary to run the business will

initially total Rs.968,000 including staff, utilities, marketing, loan
repayments and interest. These expenses will vary each year and will
gradually drop; yearly estimates follow

Expense Year 1 Year 2 Year 3 Year 4 Year 5

Staff Rs.600,000 Rs.600,000 Rs.500,000 Rs.400,000 Rs.200,000
Utilities Rs.50,000 Rs.50,000 Rs.50,000 Rs.50,000 Rs.50,000
Marketing Rs.100,000 Rs.100,000 Rs.50,000 Rs.50,000 Rs.50,000
Loan Rs.168,000 Rs.168,000 Rs.168,000 Rs.168,000 Rs.168,000
Repaymen
t
Interest Rs.50,000 Rs.40,000 Rs.30,000 Rs.20,000 Rs.10,000

Totals Rs.968,000 Rs.958,000 Rs.798,000 Rs.788,000 Rs.478,000

Promotion Schedule

The implementation of fruity bread promotional schedule is a critical

aspect of the success of the product.

The company’s promotion will include the following.

 Paid magazine articles and advertisements to generate sales

and brand awareness.
 Fruity bread event sponsorship to create brand awareness.
 Creating affiliations with sales websites to capture the online
sales market.
 Placing classified advertisements in newspapers.
  TV commercials

Operations Plan

Method of production

For Fruity Bread we use same method of production as it has been using by
other bread manufacturer, we mean to say that our production operation for
manufacturing of multi-flavor Rainbow Bread is same as it is using by other bread
companies except we add extra fruitful and delicious flavor in the each slices of
the bread.

The three main steps involve in bread manufacturing:

  The mixing of raw material.

 We process the raw material in bread manufacturing plant.

 After manufacturing desire shaping and packing of bread.

Availability of qualified labor pool

As a business graduate we all partner know the importance of HR portion

for success of any business firm. Our HR manager Mr. Bilal make selection of very
qualified labor pools especially in processing department of bread manufacturing.

As our chief chef Mr. Willam Asghar who is very experienced fellow, he has
worked for 6 year in Switzerland and has got a diploma and training session in
baking of cakes and bread. We request him to join our organization due to social
relation factors , Because currently he is also chief chef at five star hotel Pearl
Continental Hotel Lahore. He served as engine for the train because it is due to his
specific formula in the bread manufacturing our product will be successful and
will be differentiated from other bread companies.

Our Floor Mixer Mr. Qasim Shah is also very much experienced person and most
importantly already know all the basic techniques of measuring the exact mixing
techniques.
Processing Chefs and other labors persons control the processing of bread
manufacturing plants.

Finally, after bread manufacturing we acquire some specific packing experts who
know the whole procedure of packing and quality maintaining, all the packers
cover their hands with polythene hand cover in order for germ safety.

Recipe of Fruity bread

Ingredients

 1 1/4 cups water

 1 tablespoon sugar
 1 teaspoon salt
 3 1/2 cups flour
 1 1/4 teaspoons yeast

For bread machine:

Measure ingredients into baking pan in order given. Set for dough cycle.
When the dough is ready, proceed with "To Colour" below.

For hand mixed:

In a large bowl, Disolve sugar in lukewarm water. Add yeast. Let sit for
10 minutes.
Stir. Add 1 1/2 cups flour and salt. Mix vigourously for at least 5
minutes. This will reduce the kneading time. Add balance of flour 1/2
cup at a time until dough is smooth and no longer sticky.
Turn onto a floured board and knead for 10 minutes. Cover dough with
a clean tea towel and let rise in a warm place for 1/2 to 1 hour, until it
doubles in size. Punch down to remove all air bubbles.

To Colour:

Divide dough into 3 or 4 equal parts (one part for each colour desired).
Poke a hole in the dough with your finger. Put food colouring into the
hole. Use a little (5-6 drops) for light colours, more for bright colours.
Pinch the hole closed and knead the dough for 5 to 10 minutes, until
the colour is well mixed in.
Use a rolling pin to roll the dough out very flat. Use a little water to
moisten the top of one piece so the next piece will stick to it. This is
very important if alot of extra flour was used to keep the dough from
sticking during kneading. Roll the dough into a log and place it in a
greased and floured bread pan. If you do not have a bread pan, it can
be placed on a greased and floured cookie sheet. Let rise for 45 to 60
minutes. More rising time will produce a lighter bread, while less time
will result in a denser bread.
Heat oven to 350'F. Bake bread for about 25 minutes. Remove bread
from pan immediately when done. Bread should sound hollow when
tapped on the bottom. If it does not, it is not cooked yet. Cool 10-20
minutes before cutting.

Business Partnerships

Types of business partnerships

In bread operation department we have made partnership with one of the

most successful bakery products store in our city Gourmet. We will use joint
venture relationship with the Gourmet bakers.

Purpose of partnership

As, an entrepreneur we have not got so much resource that we will

purchase so many things in so much quick succession of time.

Quality control
 Because our product is initial in the market, to make it the successful there
should no compromise in the quality of the bread. Because it is matter of user’s
health and also as our most targeted individuals are children and teen agers,
these individuals are very conscious about their fitness and health. So, to provide
best quality we use fresh raw material and put strong consideration on the
cleanliness of labors operators and clean plant and equipment daily.

Also because we start new business, we concentrate to fulfill all the requirement
for acquiring quality assurance award from ISO-9001 and ISO9002.

Customer Support Strategies

We use joint venturer firm Gourmet outlet for the regular sales of our
product and also other famous big superstores of the region, we did not want to
provide it in backward areas initially. The reason behind it is that as we are
beginner, we need support from conscious customer which comes from the sale
of product from well trained salesperson of the outlets who knows the important
of the specific products and then conveys it to potential customer, for this
purpose we leave big profit margins for big superstore with best quality as
compare to other bread so our initial sales will be boost up.

Customer support obligation

Because most usage of our product is at the morning so, to reach the fresh
bread on time to superstores is big responsibility towards us because in
opposite scenario, our product will be worthless because most of children
have to use it as a breakfast and then go to school. In order to reach our
 product on time, we have formed specific teams, staff and hair vehicles for the
transportation of bread in specific regions.

Financial Plan

 Salaries and rent are the two major expenses, while depreciation
is another significant cost that will increase as the company
develops.
 We want to finance growth mainly through cash flow. We
recognize that this means we will have to grow slowly.
 It should be noted that the owners of Fruity bread do not intend
to take any profits out of the business until the long-term debt
has been satisfied. Whatever profits remain after the debt
payments will be used to finance growth, mainly through the
acquisition of additional inventory.

Important Assumptions

Key assumptions for Fruity Bread are:

 We do not sell anything on credit.

 Monthly sales are the largest indicator for this business.
 We assume access to capital and financing sufficient to maintain
our financial plan as shown in the tables.

Break-even Analysis
 For our break-even analysis, we assume per month running costs
which includes payroll, rent, utilities, and an estimation of other
running costs.
Based on our anticipated margin, what we need to sell per month to
break even is shown in the chart and table below.
Our sales forecast indicates that monthly sales are expected to be
much greater than the break-even point mentioned in the table.

Break-even Analysis

Monthly Revenue Break-even Rs.17,581

Assumptions:
Average Percent Variable Cost 67%
Estimated Monthly Fixed Cost Rs.5,838

Pro Forma Profit and Loss

FY 2008 FY 2009 FY 2010

Sales Rs.367,019 Rs.472,085 Rs.608,670

Total Cost of Sales Rs.245,154 Rs.314,147 Rs.402,472

Gross Margin Rs.121,865 Rs.157,938 Rs.206,198

Gross Margin % 33.20% 33.46% 33.88%

Expenses

Payroll Rs.26,400 Rs.39,680 Rs.66,016

Marketing/Promotion Rs.1,800 Rs.2,340 Rs.3,042

Depreciation Rs.4,140 Rs.4,140 Rs.4,140

Vehicle Expense Rs.1,700 Rs.1,850 Rs.2,000

Credit Card Surcharge Rs.3,498 Rs.4,547 Rs.5,911

Inbound Freight Charges Rs.4,964 Rs.5,497 Rs.6,036

Office Supplies Rs.600 Rs.780 Rs.1,014

Security/alarm Rs.360 Rs.360 Rs.360

Telephone Rs.2,650 Rs.3,445 Rs.4,478

Accounting Costs Rs.1,500 Rs.1,500 Rs.1,500

Rent Rs.19,200 Rs.19,200 Rs.19,200

Utilities Rs.2,400 Rs.2,400 Rs.2,400

Insurance Rs.840 Rs.840 Rs.840

Payroll Taxes Rs.0 Rs.0 Rs.0

Other Rs.0 Rs.0 Rs.0

Total Operating Expenses Rs.70,052 Rs.86,579 Rs.116,937

Profit Before Interest and Taxes Rs.51,813 Rs.71,359 Rs.89,261

EBIT Rs.55,953 Rs.75,499 Rs.93,401

Interest Expense Rs.0 Rs.0 Rs.0

Taxes Incurred Rs.15,544 Rs.21,408 Rs.26,778

Net Profit Rs.36,269 Rs.49,951 Rs.62,483

Net Profit/Sales 9.88% 10.58% 10.27%

Projected Cash Flow

Cash flow projections are critical to our success. The following table
shows cash flow for the first three years, and the chart illustrates
monthly cash flow in the first year. Monthly cash flow projections are
included in the appendix.
 Pro Forma Cash Flow

FY 2008 FY 2009 FY 2010

Cash Received

Cash from Operations

Cash Sales 367,019 472,085 608,670

Subtotal Cash from Operations 367,019 472,085 608,670

Subtotal Cash Received 367,019 Rs.472,085 608,670

 Expenditures
FY 2008 FY 2009 FY 2010

Expenditures from Operations

Cash Spending 26,400 39,680 66,016

Bill Payments 253,470 382,218 478,195

Subtotal Spent on Operations 279,870 421,898 544,211

Subtotal Cash Spent 279,870 421,898 544,211

Net Cash Flow 87,149 50,187 64,459

Cash Balance 88,149 138,336 202,795

Projected Balance Sheet

The table shows the annual balance sheet results, with a healthy
projected increase in net worth.
 Pro Forma Balance Sheet
FY 2008 FY 2009 FY 2010

Current Assets

Cash 88,149 138,336 202,795

Inventory 28,816 36,925 47,307

Other Current Assets 0 0 0

Total Current Assets 116,965 175,261 250,102

Long-term Assets

Long-term Assets 29,000 29,000 29,000

Accumulated Depreciation 4,140 8,280 12,420

Total Long-term Assets 24,860 20,720 16,580

Total Assets 141,825 195,981 266,682

Liabilities and Capital

FY 2008 FY 2009 FY 2010

Liabilities and Capital

Current Liabilities
Accounts Payable 27,555 31,761 39,979

Current Borrowing 0 0 0

Other Current Liabilities 0 0 0

Subtotal Current Liabilities 27,555 31,761 39,979

Long-term Liabilities 0 0 0

Total Liabilities 27,555 31,761 39,979

Capital

Paid-in Capital 80,625 80,625 80,625

Retained Earnings (2,625) 33,644 83,595

Earnings 36,269 49,951 62,483

Total Capital 114,269 164,220 226,703

Total Liabilities and Capital 141,825 195,981 266,682

Net Worth 114,269 164,220 226,703

Business Ratios

Business ratios for the years of this plan are shown below.

Ratio Analysis
FY 2008 FY 2009 FY 2010 Industry Profile

Sales Growth 0.00% 28.63% 28.93% 4.90%

Percent of Total Assets

Inventory 20.32% 18.84% 17.74% 47.50%

Other Current Assets 0.00% 0.00% 0.00% 28.90%

Total Current Assets 82.47% 89.43% 93.78% 76.40%

Long-term Assets 17.53% 10.57% 6.22% 23.60%

Total Assets 100.00% 100.00% 100.00% 100.00%

Current Liabilities 19.43% 16.21% 14.99% 39.20%

Long-term Liabilities 0.00% 0.00% 0.00% 15.50%

Total Liabilities 19.43% 16.21% 14.99% 54.70%

Net Worth 80.57% 83.79% 85.01% 45.30%

Percent of Sales

Sales 100.00% 100.00% 100.00% 100.00%

Gross Margin 33.20% 33.46% 33.88% 32.00%

Selling, General &

23.32% 22.87% 23.61% 19.60%
Administrative Expenses

Advertising Expenses 1.13% 0.88% 0.68% 1.40%

Profit Before Interest and

14.12% 15.12% 14.66% 1.50%
Taxes

Main Ratios
Current 4.24 5.52 6.26 2.03

Quick 3.20 4.36 5.07 0.59

Total Debt to Total Assets 19.43% 16.21% 14.99% 54.70%

Pre-tax Return on Net Worth 45.34% 43.45% 39.37% 3.50%

Pre-tax Return on Assets 36.53% 36.41% 33.47% 7.60%

Additional Ratios FY 2000 FY 2001 FY 2002

Net Profit Margin 9.88% 10.58% 10.27% n.a

Return on Equity 31.74% 30.42% 27.56% n.a

Activity Ratios

Inventory Turnover 9.67 9.56 9.56 n.a

Accounts Payable Turnover 10.13 12.17 12.17 n.a

Payment Days 27 28 27 n.a

Total Asset Turnover 2.59 2.41 2.28 n.a

Debt Ratios

Debt to Net Worth 0.24 0.19 0.18 n.a

Current Liab. to Liab. 1.00 1.00 1.00 n.a

Liquidity Ratios
 Rs.143,50 Rs.210,12
Net Working Capital Rs.89,409 n.a
0 3

Interest Coverage 0.00 0.00 0.00 n.a

Additional Ratios

Assets to Sales 0.39 0.42 0.44 n.a

Current Debt/Total Assets 19% 16% 15% n.a

Acid Test 3.20 4.36 5.07 n.a

Sales/Net Worth 3.21 2.87 2.68 n.a

Critical Risk Factor

Management Risk

To avoid any kind of management risk we have given sufficient

incentives and make key managers as equity holder of our firm so they
remain with us for the longer time for lower level employees we are
giving salaries which are above than local market we are also giving
them bonus as a result our employees are satisfied and give their
maximum efficiency.

Marketing risks
Marketing consists of advertising and promoting of product or service
in order to sell it. Marketing is to lets potential customers know that
they are available for sale. Sales, advertising, and public relations are
each essential components of marketing and each require specialized
skills and expertise. Fruity bread have only one person performing all
these functions under the marketing umbrella, knowledge of each area
is important to develop a focused effort.
Marketing Manager having focused on what the customer wants and
needs is essential to successful marketing efforts. This customer-
orientation should go hand-in-hand with the company's objective of
maintaining a profitable volume of sales. Marketing is a creative
process combining all of the activities needed to accomplish both of
these objectives.

Operational risks

Operational Plans are those plans that specify the details of how the
overall goals are to be achieved. At Fruity Bread, once a goal has been
set, plans are made to ensure that goals are being achieved. The way
this goal is being achieved at the moment is that the employees are
trained to take the order as fast as possible, then input it in the system,
forward it on to the production, and then place the order as soon as
possible. The employees are trained to do this as fast as possible and
we carried out a study to check how long the entire procedure takes
and then based on the results, the management set a target that in
how much time the order should be placed and then the product
should be at the shelves of the seller.

Financial risks
To avoid financial risk we raised our reserves to sufficient level to avoid
any kind of financial stress for that we have Mr Bilal who is chief
financial office of Habib bank who can arrange finance for us if we face
any problem in finance

Intellectual property risks

Fruity Bread has registered its intellectual property to avoid risk For this reason
we have meet legal legislation through our lawyer Mr.Kashif Zia who have
arranged to make our product register through trademark, patent rights and
register our idea and logo so, there is no intellectual property risk legally left to
worry about.