Chef Exclusive by ghkgkyyt

VIEWS: 30 PAGES: 28

									  Kelly Dietsch
 Blake Kinchla
 Pedro Lauand
Teresa Lo Contro
 Laura Mackey




       1
                                               Table of Contents

1. Executive Summary……................................................................................................1
   1.1 Objectives………………………………………………………………………....1
   1.2 Mission…………………………………………………………………………....1
   1.3 Vision…………………………………………………………………………...1-2
   1.4 Risks………………………………………………………………………….…...2
2. Company Summary……………………………………………………………............2
   2.1 Company Profile…………………………………………………………………..2
   2.2 Company Location and Facilities…………………………………………..…...2-3
3. Services………………………………………………………………………………...3
   3.1 Services Description………………………………………………………………3
   3.2 Competitor Comparison……………………………………………………….......3
   3.3 Sales Literature……………………………………………………………………4
   3.4 Literature…………………………………………………………………………..4
   3.5 Future Services……………………………………………………………....…….4
4. Market Analysis Summary…………………………………………………………….4
   4.1 Market Segmentation……...…………………………………………………….4-6
   4.2 Marketing Segmentation Target……………………………………………..……6
   4.3 Target Market Segment Strategy………………………………………………….7
        4.3.1 Market Needs………………………………………………………………..7
        4.3.2 Market Trends……………………………………………………………….7
        4.3.3 Market Growth……………………………………………………………7-8
5. SWOT Analysis………………………………………………………………………..8
   5.1 Strengths…………………………………………………………………………..8
   5.2 Weaknesses…………………………………………………………………….….8
   5.3 Opportunities…………………………………………………………………....8-9
   5.4 Threats……………………………………………………………………………..9
6. Strategy and Implementation Summary………………………………………………..9
   6.1 Value Proposition………………………………………………………………….9
   6.2 Market Strategy……………………………………………………………………9
        6.2.1 Positioning Statement……………………………………………………9-10
        6.2.2 Pricing Strategy………………………………………………………….....10
        6.2.3 Promotion Strategy……………………………………………………...…10
        6.2.4 Marketing Programs................................................................................…..10
   6.3 Sales Strategy……….………………………………………………………....…10
        6.3.1 Sales Forecast………………………………………………………….…...11
7. Web Plan Summary ……………………………………………………………..…...11
   7.1 Web Site……………………………………………………………………….…11
8. Management Summary……………………………………………………………….11
   8.1 Organizational Structure…………………………………………………………12
   8.2 Management Team…………………………………………………………...12-13
   8.3 Management Team Gaps……………………………………………………...…13
   8.4 Personnel Plan………………………………………………………………...…13



                                                          2
9. Financial Plan…………………………………………………………………………13
   9.1 Startup Funding…………………………………………………………………..13
   9.2 Important Assumptions…………………………………………………………..13
   9.3 Key Financial Indicators…………………………………………………………14
   9.4 Break-Even Analysis…………………………………………………………14-15
   9.5 Projected Profit and Loss……………………………………………………,.16-18
   9.6 Projected Cash Flow……………………………………………………….,...18-19
   9.7 Projected Balance Sheet...…………………………………………………....19-20
   9.8 Business Ratios…………………………………………………………….....20-21
Appendix……………………………………………………………………………...22-25




                              3
                                     Chef Exclusive

1. Executive Summary
    1.1 Objectives
        Chef Exclusive understands that a successful business is nothing without a
successful concept and execution of that concept, management, marketing strategy, and
quality control. Chef Exclusive plans on achieving success in all areas by doing the
following:
    • Providing in home cooking upon request
    • Providing private in-home cooking lessons
    • Professional catering for larger events
    • Creating a fun and friendly atmosphere
    • Making all employees feel vital to the business structure so that they take pride in
        there work
    • Reach target market with appropriate advertising
    • Maintain tight control of costs and operations by hiring only highly qualified
        employees
    • Keep food cost under 34% of the revenue
    • Eventually grow each location to the $661,000 annual sales level (by third year)

    1.2 Mission
    Chef Exclusive believes that to be successful we need to become an indispensable
asset to a community. One way of doing this is charity work, not only does it help us get
to know members of the community on a personal level, but makes it easier for the
customers to relate to us and feel comfortable using our services. Our consumer base will
quickly expand as we become part of a community, by word of mouth alone.
        We plan to buy and renovate a warehouse to use as both storage and kitchen
space. This facility will help us prepare food for catering events and also prepare food
for people who just want to pick it up from the warehouse. Within 2-3 years we want to
be operating out of the red. Within 6 years we hope to expand into other parts of the state
and provide quality catering services in those areas as well.
        At Chef Exclusive everyone is on a level playing field. Many people are involved
in creating a success; managers and owners can not do it alone. To keep our employees
motivated, friendly, and hard working, incentives will always be within their reach. Our
business will always try to promote within the already existing employee pool, so that
any one is able to move up the ranks of the business. We want to be a unique business
where everyone is recognized as a special individual.

    1.3 Vision
Chef Exclusive wants to be the consumer’s one stop shop for all catering and dining
needs. We want to appeal to all tastes and styles so that Chef Exclusive can be the ideal
option for servicing all types of events, from an intimate romantic dinner to an up-scale
dinner party or corporate event. Not only do we want to provide excellent service to our
consumers, we also want to thank them for giving us the opportunity in letting us do so.
Charities are a great way to say “thank you” to the public and will be of great importance
to us, we want to give back so that we can become an integral part of the community.


                                            4
We don’t want to be seen as just another business, we want to be seen as part of the
family. Chef Exclusive is committed to providing consumers with the highest quality of
food and professional service.

   1.4 Risks
   • Hundreds of catering businesses in Massachusetts alone, Chef exclusive must find
       a way to stand out
   • We will be starting out small; bigger companies have an advantage over us.
   • The food service industry has a 90% failure rate within the first year; this figure
       drops to about 60% within 3 years.


2. Company Summary

    2.1 Company Profile
        Chef Exclusive is a small private business that wants to enter the culinary arts
market where food is their top priority. This company is looking to provide in home
cooking services as well as catering for private parties by using fresh high quality food to
deliver to their customers on a consistent basis. Chef Exclusive’s main focus is to treat
people in their own home by cooking meals for their families, friends and/or colleagues.
Also, in particular, they will be cooking meals at their own location as well in order to
have the food ready to go when arrival is met. Their intention is for their busy customers
to make a great impression on their guests by providing delicious, quality food that will
be prepared and cooked to order.

    2.2 Company Location and Facilities
        As a starting point, Chef Exclusive is determined to trace the perfect location
where they will establish their warehouse. The warehouse is going to serve as a storage
place for their food and supplies in order to prepare for functions or private parties. They
will also give customers the option of entering their homes and cooking in the comfort of
their own kitchens. Their facility will be structured in a manner in which they will be
able to work together to prepare luxurious and tasty meals for their customers. Along
with using their warehouse as a place to prepare food, customers will also able to pick up
their catering orders if they desire to do so.




                                             5
(www.loopnet.com )
        A potential warehouse (one as such the picture above) would be in the Lawrence
area like the one that we researched on. This would be a perfect area since the two
company owners live between Boston and New Hampshire. This industrial space which
is located on South Broadway St. in Lawrence has 9,350 square feet of available space
which is a reasonable amount of space where Chef Exclusive can implement a restaurant
size kitchen which would be necessary when preparing food for large catering events.
This warehouse has easy access and low operating costs which are two advantages to the
owners.

3. Services

    3.1 Services Description
    Chef Exclusive is primarily focused on traveling to the customers’ homes and
preparing meals on site. They are in the process of trying to acquire a warehouse so that
they will be able to widen their customer base and deliver food to their customers as well.
In the future, they hope to also be able to cater to business functions.

    3.2 Competitor Comparison
        We do not have the exact number of top competitors that Chef Exclusive is
competing against, but there are many catering and cooking businesses and it is very
difficult to enter such a saturated market. If Chef Exclusive can make a distinct identity
for them selves and are able to expand, then they may have a good chance of being a
success.




                                             6
    3.3 Sales Literature
                Chef Exclusive uses their website as a means to sell their services and
display their unique food creations. Sample menus are available on request. At the
moment, the website and sample menus are Chef Exclusive’s only sales literature.

   3.4 Technology
               At this point in time, Chef Exclusive primarily uses the telephone and e-
mail to keep in touch with their customers and be available to prospective customers.
The website also provides a way for prospective customers to reach the owners of Chef
Exclusive.


    3.5 Future Services
               There are many options that Chef Exclusive can incorporate into their
business as time passes. Once they acquire a warehouse where they will be able to
prepare meals using their own cookware, they will be able to deliver food to the
customer’s house instead of using someone else’s equipment. We feel once they
establish themselves and hire more personnel, they can then approach businesses and
cater to them as well. There are many opportunities for them as long as they can make
themselves unique and have a good clientele.

4. Market Analysis Summary
        Chef Exclusive is a catering business looking to cater to families as well as up to
500 people. Right now in the market there are catering companies from large business
companies to the middle and lower size segment. Chef exclusive is focusing on small
catering for in house dinning and small companies that do not have a thousand
employees. In the initial stages focusing on smaller families and in house dinning and
eventually expand to the larger business of 500 people. So we are focusing on families
for catering in the beginning. We are focusing in the Boston area and New Hampshire.

    4.1 Marketing Segmentation
        Our market focuses on middle and upper class families with high income that
have disposable income or money to spend on a catering service. This target group may
or may not have children and are usually too busy to either prepare their own meals, or
prepare meals for parties that they may be hosting. In peoples every day life work gets
over whelming especially when taking care of the kids. Getting them to school, soccer
practice or whatever event your child participates in, can be time consuming and
stressful. Chef Exclusive is the perfect match for those families because they will come
in and cook a wonderful meal from a menu that the customer can pick out and enjoy with
out going through all the time and effort of preparing a meal at the end of a long day.
The ages of our key demographics range from 28-55. Chef Exclusive will also target
small to medium size businesses (1-500 people) that are in need of catered functions.
        The warehouse that we chose in Lawrence is also in the perfect area because of
the key demographics. This area has a population of about 10,525 people of which is the
target market that Chef Exclusive is focusing on between the ages of 28-55. This
population amount is between the one mile range of the warehouse. The amount of



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population for this age rage is about 54,738 people within the three mile range of the
warehouse. The charts below show the age demographics which vary a little above and
below the actual age range that they are targeting on.

                        Age Demographics Within One Mile
                                    Range


                                                                     25-29
                                   9%                17%             30-34
                         12%
                                                                     35-39
                                                                     40-44
                       13%                                    17%
                                                                     45-49
                              15%                  17%               50-54
                                                                     55-59




                       Age Demographics Within Three Mile
                                   Range
                                                                     25-29
                                                                     30-34
                                        16%
                                                         14%         35-39
                      17%
                                                                     40-44
                                                                     45-49
                                                               12%   50-54
                       16%
                                                        10%          55-59
                                         15%




                Another break down that is essential is the ethnicity demographics which
give an illustration of the different types of people that are located within one and three
miles of the area in which the warehouse is located. Although this may not be the
warehouse that Chef Exclusive uses, it still gives a good break down of the types of
people that live within the area.




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                Ethnicity Demographics Within 1 Mile
                              Range
                                                         White

                                                         Black

                   26%                   27%             Asian/Hawaiin/Pacific
                                                         Islander
                                                         American Indian
                                             2%
                   25%                17%    3%          Other

                                            0.72%        Hispanic

                                                         Non-Hispanic




                Ethnicity Demographics Within 3 Mile Range
                                                             White

                                                             Black

                  30%                             32%        Asian/Haw aiin/Pacific
                                                             Islander
                                                             American Indian

                                                     2%      Other
                        20%                 14%     2%
                                                             Hispanic
                                                    0%
                                                             Non-Hispanic




    4.2 Marketing Segmentation Target
        The customers we wish to have are families’ middle class and upper class that can
afford to pay for catering to come into their homes and cook meals for the families on
special occasions, holidays or if they just do not feel like cooking. Those customers that
do not feel like cooking for family and friends at get togethers can call Chef exclusive.
Instead of going out to a restaurant on Friday night with the family those customers could
have the restaurant come to them have a meal cooked for them by chef exclusive. When
businesses have Christmas party’s or company parties and need catering that is what chef
exclusive is for. We are targeting Middle to upper class customers through news papers
such as the Wall Street Journal, Boston Globe, and the internet sites Google and Yahoo.
Also chef exclusive is working a deal with Boston Butler for targeting the catering to the
business and larger customer base.



                                             9
    4.3 Target Market Segment Strategy
        Since there are two distinctly different groups that Chef Exclusive will be trying
to service, there will be two different market segmenting strategies. We are targeting
Middle to upper class customers through news papers such as the Wall Street Journal,
Boston Globe, and the internet sites Google and Yahoo. Also chef exclusive is working a
deal with Boston Butler for targeting the catering to the business and larger customer
base.
        1. Middle to high income families – To reach this market, convenience and price
will be the main focuses. Chef Exclusive will enter a home and prepare meals for the
future consumption of their customers. This will provide convenient, yet healthy meals
for families or singles “on the run”. Since food preparation could be done in the person’s
home, the cost of the meals will be cheaper because Chef Exclusive facilities will not be
used. However, if the customer wants the meals delivered to their home already
prepared, the cost may slightly increase due to shipping and facility use.
        2. Small to medium size businesses – To reach this market, service and quality
will be our main focus. To large amounts of food will have to be prepared at supreme
quality. Pricing may be less of an issue do to the fact that businesses are willing to spend
more money for catered events. Pricing of meals will be higher due to the use of the
Chef Exclusive facilities for preparation and transportation of food.

        4.3.1 Market Needs
Chef exclusive is catering to make your in house dining a great experience through a
service that provides in house cooking at your convenience. This service is here to
provide our customers with time to relax and spend time doing everything else but
cooking. Cooking quality meals takes experience and that is what chef exclusive has.
Imagine eating restaurant quality meals in your own dining room. Customers might want
to eat meals that one might not be able to prepare on their own like for example having a
nice lobster dinner might be something that interests a customer but that might not know
how to cook it. Chef exclusive is here to satisfy your dinning needs.

        4.3.2 Market Trends
                People will continue to grow more and more health conscious as time goes
on. In 2005, 31% of the respondents to a food survey (allrecipes.com) said that it was
important to them to have organic foods incorporated into their daily diets. 24%
responded that it was imperative to eliminate trans fat from their diets. Along with
increasing the amount of organic foods and cutting back on trans fats, portion control is
also a big issue to consumers. Consumers are asking for smaller portions of foods during
meals. The obesity rate is climbing and people believe the culprits are the over-sized
portions restaurants and catering companies prepare. Less is now more; meaning that
people are more conscious of what they are putting in their bodies. Cutting back on
carbohydrates, red meats, sugars and overly processed foods are also predicted to be
popular trends. (allrecipes.com)

       4.3.3 Market Growth
       The catering market is one of the fastest-growing segments of the food service
industry, expected to top $14 billion in sales in 2005, with off-premises caterers, banquet



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halls and hotels commanding the majority of the special-event market--but not
monopolizing it. Catering is expected to out grow the restaurant industry in over all
growth rates. The industry is expected to grow 4.9 % to $ 475.8 billion in sales and
social-catering sales are expected to grow 7.0 percent $5.3 billion. (Erica Duecy).

5. S.W.O.T. Analysis

    5.1 Strengths
     Chef Exclusive is a small business that is striving for its success in the food industry
which means that some internal factor affect the business. To begin they all ready have
some advantages or strengths to their business. Daneyon White and Yasmin Farrell have
a concrete history and excellent experience in the restaurant arena. Both, being experts in
culinary arts as professional chefs, bring sufficient amount of knowledge to the
workplace and are only worker harder to keep learning more about food. Daneyon has
received a Bachelor’s Degree at the University of Johnson and Whales which is an
advantage Not only their work background but their ethnic background plays a big role in
what many customers are looking for. They both come from very different backgrounds,
like Yasmin coming from Turkey, which gives the ability to provide their customers with
very unique food dishes. Many customers look for many diverse dishes which is
something they can offer first hand. Another strength to the business is that from having
worked in high class restaurants like the Tewksbury Yacht Club and Walt Disney that
Daneyon has worked at, helps with the marketing of their services through all the people
they have met on their road to becoming professionals. They are able to recognize what
foods are perfect for each occasion from past experiences, both good and bad. Their
mistakes along with other peoples’ mistakes have helped them to understand what not to
do the second time around.

    5.2 Weaknesses
    Although the two entrepreneurs have a good background in the food industry there
are some weaknesses to their business ideas. For starters they do not have a sufficient
amount of capital in order to start up. However they do plan on taking out loans from
$150 to $200 thousand for start up costs. Unfortunately with their intense focus on the
service of their business they do not have an expertise in marketing and financials for
their new business. Another weakness that they face is that they do not have a large
clientele to begin with so getting their name out there and to be heard may be a challenge,
considering the increasing amount of businesses going into catering for their own already
established restaurants. They also lack an employee base that will help them during big
parties or when they get over twenty or so people. That extra hand is needed in order to
keep the quality of the meals. Not having a warehouse or a stable place to store their
food and cook for meals may be a problem I the beginning until a definite location is
acquired. In-home cooking may not be fit for all customers because would prefer that the
catering service should use their own materials to cook with and serve their food.

   5.3 Opportunities
   Chef Exclusive has some beneficial opportunities in the industry they are entering.
Their opportunities are external to their business which in turn can help them very much



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   in the long run. Mergers, joint ventures and strategic alliances are all options that Chef
   Exclusive can look in to in the process of picking up their business. They could join
   some kind of alliance with a restaurant which involves maybe even catering for them.
   Looking into their previous employers or restaurants they worked for to form some kind
   of alliance is a plus especially when they already know what Chef Exclusive is capable of
   delivering to their customers.

       5.4 Threats
           Unfortunately there are some threats to Chef Exclusive that may bring them down
   in the process. The food industry, being such a large and popular field, involves an
   increased amount of competition of many different forms. Restaurants, other catering
   companies and/or party planners may pose as threats to them. The pricing of their
   services will however be affected by this leaving it as another threat. In the 21st century
   many more entrepreneurs are out there trying to explore the business world which may
   mean that these other competitors may have new innovative products or services which
   definitely will pose as a big threat to Chef Exclusive. A few other threats that Chef
   Exclusive faces is the cost of gas for transportation of food and also for the preparation of
   meals.

6. Strategy and Implementation Summary

       6.1 Value Proposition ( What are customers getting for the money they spend)
       Chef exclusives customers get great food and service with all the accommodations of
   a catering service. From in house dinning, families gain time to spend with family or to
   relax. Businesses gain a quality food and great service for events that leave an impression
   that the company they work for is willing to go the extra yard for its employees by hiring
   a professional catering service.

       6.2 Marketing Strategy
       In order to market Chef Exclusive effectively Daneyon and Yasmine will need to
   acquire back ground data on customers wants and needs in the Boston/New Hampshire
   area by getting secondary data. Chef Exclusive should hire a marketing company to
   conduct a sufficient survey with adequate information from potential customers in the
   Boston suburbs and New Hampshire area for Primary data. To avoid costs accrued by
   hiring a marketing company to provide Chef Exclusive with survey information,
   Daneyon and Yasmine could do it themselves if they wished to spend the time and effort.
   Presently, Chef Exclusive is willing to spend between $4,500- $10,000, this may either
   decrease or increase within the next few years depending on success of the business. In
   the beginning, Daneyon and Yasmine will only be targeting households to service small
   private parties and businesses up to 500 people.

           6.2.1Positioning Statement
           Chef exclusive will be targeting 1-500 people and making it simple for customers
   by providing them with sample menus. Chef Exclusive will pride themselves on being
   convenient solution that will be given to their customers. Chef Exclusive wants to
   position them selves so that families and businesses know who they are and are able to



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enjoy quality food at a decent price. By performing local charity work, placing ads in
news papers, internet and other media, Chef Exclusive’s popularity will increase and
therefore have successfully positioned them selves within the market.


       6.2.2Pricing Strategy
       Chef exclusive will be charging $ 55 a meal to be able compete with competitors.
Some of their competitors have priced their meals between $32-42, while Chef
Exclusive’s more direct competitors have set higher prices ranging from $55 and up.
Chef exclusive is quality food at a price that is affordable and meets the quality
expectations.

        6.2.3Promotion Strategy
        The company’s owner’s strategy in promoting Chef Exclusive is to purchase ads
in the local news papers and internet, in the surrounding towns of Lowell and lower New
Hampshire area (Lawrence, its surrounding towns up through Southern New Hampshire).
The ads to purchase on the internet are from sites such as Yahoo, Ask, and Google which
vary with prices from $30 and up a month. Spending an increased amount on marketing
will be to Chef Exclusive’s benefit for example spending $100-400 on internet
advertisement a month. Since Chef Exclusive is constricted by how much they can spend
on advertisement, in order to reach his potential customer base they will need to work
charities and other non profit events. At these events they will provide their services free
of charge in hopes of enticing new customers with their food which they may not have
tried otherwise.

       6.2.4 Marketing Programs
       Chef Exclusive should increase marketing through Google, Yahoo, and Ask in the
summers (cookouts) and around the holidays, as well as continuing growth through word
of mouth.

        6.3    Sales Strategy
        Based on our sales forecast Chef Exclusive needs to sell an average of 3690 meals
per year. In being able to make this amount of sales they need to look into additional services to
offer customers which will help expand their customer base.
`




                                                13
       6.3.1 Sales Forecasts
Sales Forecast

                       Jan        Feb         March Apr         May        June    July        Aug        Sep        Oct        Nov        Dec
Unit Sales
Advertising                   1          1        1         1          1       1           1          1          1          1          1          1
Cooking Lessons              48         47       54        52         55      59          63         66         69         72         74         79
Total Unit Sales             49         48       55        53         56      60          64         67         70         73         75         80

Unit Prices
Advertising              300            300     300    300        300        300      300        300        300        300        300        300
Cooking Lessons           60             60      60     60         60         60       60         60         60         60         60         60

Sales Advertising
Advertising               300         300        300   300   300   300   300   300                           300   300   300   300
Cooking Lessons        2,880        2,820      3,240 3,120 3,300 3,540 3,780 3,960                         4,140 4,320 4,440 4,740

Direct Unit Costs
Advertising              210            210     210    210        210        210      210        210        210        210        210        210
Cooking Lessons           15             15      15     15         15         15       15         15         15         15         15         15

Direct Cost of Sales
Advertising              210            210     210    210        210        210      210        210         210   210   210   210
Cooking Lessons          720            705     810    780        825        885      945        990       1,035 1,080 1,110 1,185



7    Web Plan Summary
    The Chef Exclusive Web Site is designed to attract potential customers and display
past creations of meals prepared by the two chefs. In the future the website will be able
to indicate prices of different menus they may offer.

    7.1 Website
Chef Exclusive’s web site has been made and is located online. Below is the home page
of the web site.

                       http://academics.merrimack.edu/~revir/ChefExclusive

8. Management Summary
    At the moment, Chef Exclusive consists of Daneyon White and Yasmine Farrell.
They are co-owners, management, and are both full time employees. In the future they
will need further assistance. They will need one more part-time chef to aid in preparing
for large parties. Also, they will have to employee a person on a part-time basis to take
care of all financial and Human Resource dealings. Further details can be found in the
following sections.




                                                      14
    8.1 Organizational Structure

                                     Chefs/Owners/Management
                                     Daneyon White and Yasmine
                                              Farrell




                                             Part-time Chef
                 Finance                                                         HR



             Customer                      Chefs                Finance/HR

                                      Rental of china?        Front money to
              Place            Yes
                                                               pay for China
              order
                                                              rental plus food

              Does                                            Produce money
            customer                                             to buy food
               like                      Prepare              from wholesaler
                               No
             menu?                        menu
                                Yes

                                         Prepare
               Setup                      Food                       Pay
                                                                   employees

            Customer                     Receive
            Satisfied?                   Rentals                     Key
                         Yes                                     action
                                         Receive                              decision
                                         Payment
                                                               Start/finish




.

    8.2 Management Team
    Daneyon White and Yasmine Farrell – Buying equipment, employee scheduling, one
or both should be notified of any problems. They will also be the heads of weekly
meetings for entire staff to either work out problems or congratulate hard work, keep


                                               15
track of the PEO (payroll, human resources, insurance, etc.). There will also be no
custodial staff during the first year of Chef Exclusive; therefore Danyeon and Yasmine
will be in charge of keeping their warehouse and other entities clean.
Chefs – Chefs will keep their work space exceptionally clean, and put away all food not
in use. If the chefs would like to offer a special on the menu they must notify the
managers or the owner so that the correct food ordering will be done.

    8.3 Management Team Gaps
        Although both Daneyon and Yasmine are exceptionally talented chefs, they lack
business knowledge. They prefer to hire someone to concentrate on financial matters and
if possible also keep track of Human Resource dealings as well. If that is not possible,
both Daneyon and Yasmine will have to consider outsourcing.

    8.4 Personnel Plan
    Presently, Chef Exclusive consists of only Daneyon and Yasmine. They both hold
other jobs and therefore will only make $20,000 annually from Chef Exclusive. When
Chef Exclusive becomes more profitable, they will be able to retain more earnings.
Once other employees are necessary (HR, finance) they will be paid a competitive salary
according to the market.
Wait staff for future functions will be hired on a part-time basis and paid between $10-13
per hour.


9. Financial Plan

   9.1 Start Up Funding
   Daneyon has told us that he plans to take out a home equity loan between $150,000 to
$200,000 to borrow against the equity built into his house in order to finance Chef
Exclusive. Daneyon also plans on acquiring a small business loan to help pay for his
expenses.

   9.2 Important Assumptions
          • We are assuming that there will be continued growth in the catering
             industry in the future.
          • We are assuming that we will have adequate funding to meet cash flow
             needs until we are able to reach a profit.
          • We are assuming that we have enough of a competitive advantage to make
             our service more desirable than their local competitors.
          • We are assuming that our customers will have continued faith in our
             services and will continue to be loyal to Chef Exclusive.




                                            16
   9.3 Key Financial Indicators


                700,000
                600,000

                500,000

                400,000

                300,000
                                                                                   FY 2006
                200,000                                                            FY 2007
                100,000                                                            FY 2008

                     0
               -100,000




                                                  Operating




                                                              Net Profit
                           Sales




                                                                           Break
                                    Margin




                                                                           Even
                                    Gross




                                                    Exp.


    9.4 Break-even Analysis
    The Break-even Analysis is based on the average of the first-year figures for total
sales and by operating expenses. These are presented as per-unit revenue,
per-unit cost, and monthly fixed costs. We are expecting to break even in about
one year. The table below displays the break-even analysis, including the monthly unit
and sales break-even points.

Break-Even Analysis

Monthly Units Break-even                                                            1,000
Monthly Revenue Break-even                                                         55,000

Assumptions:

Average Per-Unit Revenue                                                           $55.00
Average Per-Unit Variable Cost                                                     $40.00
Estimated Monthly Fixed Cost                                                       15,000




                                             17
                               Break Even Analysis

          15000

          10000

           5000
Profits



              0
                   1   2   3   4   5   6     7     8   9 10 11 12 13   Profits
           -5000

          -10000

          -15000

          -20000
                                           Sales




                                            18
   9.5 Projected Profit and Loss
The following table and charts show the projected Profit and Loss for Chef Exclusive.

Pro Forma Profit and Loss
                                     FY          FY        FY
                                     2006        2007      2008

Sales                                465,300 594,000 661,200

Direct Cost of Sales                 360,000 432,000 433,200
Other Costs of Sales                   1,500   1,500   1,500

Total Cost of Sales                  358,500 430,500 431,700

Gross Margin                         106,800 163,500 229,500
Gross Margin
%                                    22.95%      27.53%    34.71%

Expenses

Rent                                  61,200      61,200    61,200
Payroll                               20,000      41,000    48,000
Marketing/Promotion                    3,600       3,600     3,600
Depreciation                             500         500       500
Telephone Service                        720         720       720
Internet Service                         600         600       600
Other General and Admin.              30,000      30,000    30,000

Total Operating Expenses             116,620 137,620 144,620

Profit Before Interest and Taxes      (9,820)    25,880 114,880
Taxes Incurred                            865       991   1,094

Net Profit                            (8,995)    24,889 113,786
Net Profit/Sales                       1.92%     4.19% 17.20%




                                            19
                               Monthly Profit

50000.00
40000.00
30000.00
20000.00
10000.00
    0.00




                                            May
                           March




                                                          July




                                                                                    Nov
               Jan




                                                   June


                                                                 Aug
                                    April
                     Feb




                                                                              Oct
                                                                       Sept




                                                                                          Dec
                                   Yearly Profit

   250,000

   200,000

   150,000

   100,000

    50,000

           0
                     FY 2006                      FY 2007              FY 2008




                       Gross Margin Monthly

 120,000
 100,000
  80,000
  60,000
  40,000
  20,000
       0
            ril
           ay
          ne

            ly




           ov
             g
       M b
          ch
            n




           pt
           ct
         Au
         Ja
         Fe




         Ju
        Ap




         O
        Se
         M




         N
        Ju
        ar




                                            20
                                    Gross Margin Yearly

                 250,000
                 200,000
                 150,000
                 100,000
                  50,000
                         0
                                 FY 2006      FY 2007       FY 2008




   9.6 Projected Cash Flow
   Cash Flow projections are critical to Chef Exclusive’s success. Net cash flow for
2006 is estimated to be $50,883, ($90,670) in 2007, and ($83,000) in 2008. The
company owns a desktop computer and a vehicle for transportation of deliveries, and
does not own any other long-term assets that affect the cash flow. The following chart
and table outlines Chef Exclusive’s Projected Cash Flow.




                                     Cash for FY 2006

               60000
               50000
               40000
               30000
               20000
               10000
                   0
                       n




                                             ne




                                                                    ec
                                                      g


                                                            ct
                               ch
                    Ja




                                                   Au


                                                           O
                             ar




                                                                   D
                                            Ju
                             M




                                            21
Pro Forma Cash Flow

                                            FY 2006   FY 2007    FY 2008
Cash Received

Cash from Operations
Cash Sales                                   75,000    89,000     106,000
Cash from Receivables                        19,000    23,500      33,750

Subtotal Cash from Operations                94,000   112,500     139,750

Additional Cash Received

Sales Tax Received                                0         0           0
New Current Borrowing                             0         0           0
New Other Liabilities                             0         0           0
New Long-term Liabilities                   200,000         0           0
Sales of Other Current Assets                     0         0           0
Sales of Long-term Assets                         0         0           0
New Investment Received                           0         0           0

Subtotal Cash Received                      294,000   112,500     139,750

Expenditures

Expenditures from Operations

Cash spending                               127,347    87,400      52,500
Bill payments                                62,520    62,520      62,520

Subtotal Spent on Operations                189,867   149,920     114,750

Additional Cash Spent
Sales Tax Received                                0         0           0
Principal Repayment of Current Borrowing          0         0           0
Other Liabilities Principal Repayment             0         0           0
Long-term Liabilities Principal Repayment    53,250    53,250      53,250
Purchase Other Current Assets                     0         0           0
Purchase Long-term Assets                         0         0           0
Subtotal Cash Spent                         243,117   203,170     222,750

Net Cash Flow                                50,883   (90,670)    (83,000)
Cash Balance                                 50,883   (39,787)   (122,787)




   9.7 Projected Balance Sheet
       The projected balance sheet for Chef Exclusive is illustrated below.




                                            22
Pro Forma Balance Sheet

                                                  FY 2006           FY 2007         FY 2008

Assets

Current Assets
Cash                                                     48,880        (39,787) (122,787)
Accounts Receivable                                      32,500          45,125    60,608
Other Current Assets                                          0          42,383         0

Total Current Assets                                     81,380        127,295      183,395

Long-Term Assets
Long-term Assets                                         18,000         18,000       18,000
Accumulated Depreciation                                    500          1,000        1,500

Total Long-term Assets                                   17,500         17,000       16,500

Total Assets                                             98,880        144,295      199,895

Liabilities and Capital


Current Liabilities
Accounts Payable                                          4,200           4,800       5,100
Current Borrowing                                             0               0           0
Other Current Liabilities                                     0               0           0

Long-Term Liabilities                                  200,000         200,000      200,000

Total Liabilities                                      204,200         204,800      205,100

Paid-in Capital                                               0              0            0
Retained Earnings                                      (13,235)          4,627       15,392
Earnings                                                (8,955)         24,889      113,786

Total Capital                                          (22,190)         29,516      129,178

Total Liabilities and Capital                            98,880        144,295      199,895
Net Worth                                              (22,190)         29,516      129,178


   9.8 Business Ratios
       Chef Exclusive’s projected business ratios are provided in the next table.



                                           23
Ratio Analysis
                                   FY       FY       FY
                                   2006     2007     2008

Sales Growth                         0.00    27.66    11.13

Percent of Total Assets

Other Current Assets                 0.00    42.83     0.00
Long-term Assets                    17.70    11.78     8.25
Total Assets                       100.00   100.00   100.00

Current
Liabilities                          2.05     2.34     2.49
Long-term Liabilities               97.94    97.66    97.51
Total Liabilities                  100.00   100.00   100.00

Percent of Sales

Sales                              100.00   100.00   100.00
Gross Margin                        22.95    27.53    34.71
Profit Before Interest and Taxes     2.11     4.36    17.37

Main Ratios

Current                             19.48    26.52    35.96
Total Debt to Total Assets           2.06     1.42     1.03
Pre-tax Return on Net Worth         44.25    87.68    88.93
Pre-tax Return on Assets             9.93    17.94    57.47

Additional Ratios

Net Profit
Margin                               1.92     4.19    17.20
Return on Equity                    40.54    84.32    88.01

Debt Ratios

Debt to Net Worth                    0.92     0.69     1.02
Current Liab. To Liab.               1.00     1.00     1.00

Additional Ratios
Assets to Sales                     21.25    24.29    30.23
Current Debt/Total Assets            4.25     3.33     2.55
Sales/Net Worth                     20.97    20.12     5.12
Dividend Payout                         0        0        0


                                    24
                                                 Appendix


Sales Forecast

                       Jan        Feb         March Apr         May        June    July        Aug        Sep        Oct        Nov        Dec
Unit Sales
Advertising                   1          1        1         1          1       1           1          1          1          1          1          1
Cooking Lessons              48         47       54        52         55      59          63         66         69         72         74         79
Total Unit Sales             49         48       55        53         56      60          64         67         70         73         75         80

Unit Prices
Advertising              300            300     300    300        300        300      300        300        300        300        300        300
Cooking Lessons           60             60      60     60         60         60       60         60         60         60         60         60

Sales Advertising
Advertising               300         300        300   300   300   300   300   300                           300   300   300   300
Cooking Lessons        2,880        2,820      3,240 3,120 3,300 3,540 3,780 3,960                         4,140 4,320 4,440 4,740

Direct Unit Costs
Advertising              210            210     210    210        210        210      210        210        210        210        210        210
Cooking Lessons           15             15      15     15         15         15       15         15         15         15         15         15

Direct Cost of Sales
Advertising              210            210     210    210        210        210      210        210         210   210   210   210
Cooking Lessons          720            705     810    780        825        885      945        990       1,035 1,080 1,110 1,185




                                                      25
Pro Forma Profit and Loss
                        Jan      Feb   March Apr     May    June   July   Aug    Sep    Oct     Nov   Dec
Sales                     38,775 37,665 38,155 38,025 38,520 38,730 38,900 38,755 39,425 39,425 39,310 39,795
Direct Cost of Sales      30,000 30,000 30,000 30,000 30,000 30,000 30,000 30,000 30,000 30,000 30,000 30,000
Other Cost of Sales         1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500          1,500 1,500 1,500

Total Cost of Sales       31,500 31,500 31,500 31,500 31,500 31,500 31,500 31,500          31,500   31,500 31,500 31,500

Gross Margin               7,275 6,165 6,655 6,525 7,020 7,230 7,400 7,255 7,745          7,925 7,810 8,295
Gross Margin %           18.76% 16.37% 17.44% 17.16% 18.22% 18.67% 19.02% 18.72% 19.73% 20.10% 19.87% 20.84%

Expenses
Rent                      5,100    5,100   5,100   5,100   5,100   5,100   5,100   5,100    5,100   5,100   5,100   5,100
Payroll                    1,667   1,667   1,667   1,667   1,667   1,667   1,667   1,667    1,666   1,666   1,666   1,666
Marketing/Promo.             300     300     300     300     300     300     300     300      300     300     300     300
Depreciation                  42      42      42      42      42      42      42      42       42      42      42      42
Telephone Service             60      60      60      60      60      60      60      60       60      60      60      60
Internet Service              50      50      50      50      50      50      50      50       50      50      50      50
Other Gen. and Admin.      2,500   2,500   2,500   2,500   2,500   2,500   2,500   2,500    2,500   2,500   2,500   2,500

Total Operating Exps.      9,719   9,719   9,719   9,719   9,719   9,719   9,719   9,719    9,718   9,718   9,718   9,718

Profit before Int. & Tax (2,444) (3,554) (3,064) (3,194) (2,699) (2,489) (2,319) (2,464) (1,973) (1,793) (1,908) (1,423)
Taxes Incurred                72      72      72      72      72      72      72      72      72      72      72      72

Net Profit               (2,372) (3,482) (2,992) (3,122) (2,627) (2,417) (2,247) (2,392) (1,901) (1,721) (1,836) (1,350)
Net Profit/Sales         -6.12% -9.24% -7.84% -8.21% -6.82% -6.24% -5.78% -6.17% -5.72% -4.37% -4.67% -3.39%




                                                   26
Pro Forma Cash Flow
                      Jan      Feb   March Apr   May   June  July  Aug   Sep   Oct   Nov   Dec
Cash from Operations
Cash Sales                5,910 6,145 5,885 5,890 6,185 6,240 5,855 6,710 7,125 6,785 6,645 5,625
Cash from Receivables     1,582 1,581 1,583 1,582 1,584 1,585 1,587 1,586 1,588 1,586 1,578 1,578

Total Cash from Oper.        7,492     7,726    7,468   7,472    7,769    7,825    7,442    8,296   8,713    8,371    8,223    7,203

Additional Cash Rec'd
New Long-term Liab.        200,000        0        0        0       0        0        0        0        0        0        0        0

Expenditures
Cash Spending               10,609 10,621 10,611 10,620 10,606 10,622             10,604 10,595 10,611 10,618 10,610          10,620
Bill Payments                5,187     5,187    5,187   5,187    5,187    5,187    5,187 5,187 5,187 5,187 5,187               5,193

Total Cash Spent on Op.     15,796    15,808 15,798 15,807 15,793 15,809          15,791 15,782 15,798 15,805 15,797          15,813

Additional Cash Spent
LTL Principal Repay.         4,438     4,438    4,438   4,438    4,438    4,438    4,438    4,438   4,438    4,438    4,438    4,438

Total Operating Exps.       20,234    20,246 20,236 20,245 20,231 20,247          20,229 20,220 20,236 20,243 20,235          20,251

Net Cash Flow             187,158 (12,520) (12,768) (12,773) (12,462) (12,422) (12,787) (11,924) (11,523) (11,872) (12,012) (13,048)
Cash Balance               187,158 174,638 161,870 149,097 136,635 124,213 111,426 99502 87,979 76,107 64,095 51,047




Pro Forma Balance Sheet


                                                         27
                                Jan            Feb            March      Apr           May         June         July           Aug           Sep           Oct           Nov           Dec
Current Assets
Cash                                   4,071          4,079      4,074         4,078     4,060        4,082            4,074         4,063         4,077         4,071         4,077         4,074
Accounts Receivable                    2,713          2,701      2,695         2,702     2,700        2,714            2,711         2,712         2,704         2,709         2,713         2,726

Total Current Assets                   6,784          6,780      6,769         6,780     6,760        6,796            6,785         6,775         6,781         6,780         6,790         6,800

Long-term Assets                       1,500          1,500      1,500         1,500     1,500        1,500            1,500         1,500         1,500         1,500         1,500         1,500
Accumulated Depreciation                  42             42         42            42        42           42               42            42            42            42            40            40

Total Long-term Assets                 1,458          1,458      1,458         1,458     1,458        1,458            1,458         1,458         1,458         1,458         1,458         1,458

Total Assets                          8,242          8,238      8,227      8,238         8,218        8,254            8,243         8,233         8,239         8,239         8,239         8,239

Current Liabilties
Accounts Payable                        350            344        355           356          346          343           347           351           353           348           355           352

Long-term Liabilities                 16,667         16,667     16,667     16,667       16,667       16,667        16,667        16,667        16,666        16,666        16,666        16,666

Total Liabilities                     17,017         17,011     17,022     17,023       17,013       17,010        17,014        17,018        17,019        17,014        17,021        17,018

Paid-in Capital                         0              0       0       0       0       0                                0       0       0       0       0                                     0
Retained Earnings                 (1,103)        (1,103) (1,103) (1,103) (1,103) (1,103)                          (1,103) (1,103) (1,103) (1,103) (1,103)                               (1,102)
Earnings                            (746)          (746)   (746)   (746)   (746)   (746)                            (746)   (746)   (746)   (746)   (746)                                 (746)

Total Capital                     (1,849)        (1,849) (1,849) (1,849) (1,849) (1,849)                          (1,849) (1,849) (1,849) (1,849) (1,849)                               (1,848)

Total Liabilities and Capital    15,168         15,162         15,173     15,174       15,164       15,161        15,165        15,169        15,170        15,165        15,172        15,170
Net Worth                        13,319         13,313         13,324     13,325       13,315       13,312        13,316        13,320        13,321        13,316        13,323        13,322




                                                                         28

								
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