Free Donut Shop Business Plan by anamaulida

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         Free Donut Shop Business Plan for Loans
Obtaining Business Financing
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When obtaining a business loan for a donut shop business, it is
imperative that you have a properly structured business plan that will
assist you in showcasing how you intend to operate your Donut Shop, how
the business will operate, how you intend to market the business, the
anticipated financial results of your company, and how you intend to
repay your debt obligations. This sample loan business plan will provide
you with the framework that you need in order to acquire a business loan
for starting or expanding this type of business.
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Executive Summary
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Introduction
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When obtaining a business loan for a donut shop, it is imperative that
your business plan has a clear and concise executive summary that
provides an outline of what are seeking to accomplish, how much capital
you are seeking to raise, the management biography of the business owner,
and an overview of the anticipated profit and loss statements of the
business. Here is an example of how the title paragraph should be
written:
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Donut Shop, Inc. ("the Company") is seeking a business loan of $100,000
in order to launch the operations of a donut shop business that will be
based in San Francisco, California. The Company was founded in (Insert
Year). The business was founded by Mr. John Doe.
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Products and Services
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In the next segment of the business loan and business planning document,
you should showcase the products and services that you will be providing
to the general public. For instance:
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As stated above, Donut Shop, Inc. will specialize in the retail sale of
donuts, pastries, and beverages that are commonly found among retail
locations that specialize in these products. The business will produce
its donuts and pastries on site so that customers are provided with only
the freshest products on a daily basis.
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The third section of the business plan will further discuss the
operations and products offered by the Donut Shop.
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Business Loan Terms
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Now it is time to discuss the anticipated terms of the business plan that
you are seeking. An example paragraph of how this is stated:
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At this time, Mr. Doe is seeking a conventional business loan in the
amount of $100,000. The interest rate, loan terms, and loan covenants are
to be determined during negotiation. However, this business plan assumes
that the business will receive a seven year business loan with a seven
percent interest rate due on the outstanding principal balance.
Management Biography
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Now that the summary of the business has been provided, it is time to
provide a brief overview of the owner of the business. An example
paragraph summing up the owner is as follows:
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Mr. Doe is a highly experienced business person that has years of
experience regarding the direct ownership and management of business. He
will be able to effectively bring the operations of the Donut Shop to
profitability while ensuring that the business loan's payments and its
covenants are met at all times.
Financial Statements
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The most important thing to your lender when applying for a business loan
is how you intend to repay the bank. In this section of the business
plan, you should provide an overview of the finance's of the business
discussing the anticipated revenues, expenses, and profits/losses. You
can also discuss the applicable collateral within the business plan that
will be used to secure your business financing.
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Expansion Plans
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One of the most important aspects of your business plan is how you intend
to expand the business over a three to five year period. Banks and
finance companies always want to see that the business will experience a
moderate to strong level of growth. This is especially true in business
lending because as your business grows the cash flow that secures your
business loan will decrease proportionality against your monthly credit
obligations. An example of how this is stated is as follows:
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The Donut Shop will continue to expand through organic means including
increasing the Company's advertising budget via the reinvestment into the
after tax cash flows of the business. Additionally, if the business is
highly successful then the Company may seek to establish additional Donut
Shop locations after the third year of operations.
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The Financing
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Use of Business Loan Proceeds
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In this section of the business plan you should focus on how the proceeds
of the business loan will be used. An example of this would be as
follows:
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Donut Establishment - $50,000
Kitchen Equipment and Opening Inventory - $10,000
Working capital - $40,000

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Management Equity
In this section of the business plan you should discuss the percentage
ownership of the business among the owners of the business. For example:
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Mr. Doe will own 100% of the Donut Shop.
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Board of Directors
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When applying for business financing, the bank will also want to know who
serves as the board of directors. For small businesses, usually the owner
serves as the director of the business. An example of how this is worded:
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Mr. Doe will be the sole director of Donut Shop, Inc.
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Exit Strategy
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Any bank or financing company is also going to want to know what you
intend to do with the business over a set period of time. Many business
owners will develop and expand a business with the intent to sell the
company to a third party at a later time. When drafting this part of the
business plan you should focus on what you intentions are in regards to
potentially selling the business. This is often worded as:
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Mr. Doe would most likely sell the Donut Shop to a third party for a
significant earnings multiple. Donut Shops usually sell for approximately
one to three times earnings given the financial strength of the business.
In this event, the business would be sold by a business broker and the
business loan sought in this plan would be repaid according to the
covenants of the business loan agreement.
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Products and Services
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When developing a business plan that is appropriate for obtaining a
business loan or other business credit facility you need to clearly
showcase the services or products that you will be offering to the
general public. An example of how this section is worded goes as follows:
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The Donut Shop will pride itself on only providing the freshest donuts to
the general public of San Francisco. The business will sell a wide
variety of donuts, pastries, and beverages (including coffee and teas)
that will generate substantial gross margins for the business. As stated
in the executive summary, all donut and pastry products will be produced
on a daily basis directly within the Company's location.
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Industry and Market Analysis
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The Current State of the Economy
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It is important to let your financial institution know that you are well
apprised of the financial situation of the general economy when you are
applying for a business loan. This is especially true in today's
environment where lending has become more difficult and will remain more
difficult in the foreseeable future. Specifically, you should gear this
section of the business plan analysis towards the industry that you are
operating within. For example:
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The current economy has remained difficult over the past few years.
However, Donut Shops tend to operate with a strong degree of economic
stability as the low pricing point of the Company's products coupled with
the fact that many people need a quick sugar fix will allow the business
to remain profitable and cash flow positive at all times despite the
difficulties in the economy.
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The Donut Shop Industry
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In addition to providing your business loan officer with an understanding
of the general economy, it is important that you showcase that you have
an equal understanding of the industry in which you are operating within.
As such, you will need to provide you business loan institution of a
brief overview of your industry and any potential changes that may affect
the way that your company does business. An example of how an industry
overview is as follows:
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Around the country, there are more than 8,000 businesses that specialize
in the sale of pastries and donuts that operate one or more retail
locations within the United States. This is a mature industry and the
expected growth rate is expected to remain on par with that of the
general economy. In each of the last five years, the industry has
generated more than $3.5 billion dollars while providing employment to
more than 80,000 people.
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Target Market
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In this section of the business loan application and business plan
analysis, you should focus on the demographics of your localized market
(or national market if applicable). This section should discuss how many
people live in your area, the anticipated number of people that would
require the use of Donut Shops, the median household income of people
living in the area, poverty line statistics, and any applicable laws that
would apply to your operation of Donut Shops.
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Competition
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Many people that are developing new businesses or expanding existing
businesses often feel that their business does not have any competition
or limited competition at best. However, this is almost never the case.
Unless you have re-invented the wheel – you will have competition. When
applying for a business loan, you should clearly showcase your
competition in your business plan. This is especially important to your
banker as they will be able to gauge your ability to be successful in
your targeted market. Many business loan underwriters will aggressively
confirm that competitive nature of your local market and your local
industry.
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When drafting this section of the plan you should heavily discuss the
competitive advantages that you intend to have over your competition.
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Marketing Plan
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In addition to all of the above information that we have covered, your
business loan officer is also going to want to know how you intend to
market your business to the general public. Most people do not quite
understand how to effectively market their business outside of prominent
signage or flyer distribution. When applying for a business loan (again
in this difficult lending climate), your banker is going to want to see
that you have a clear methodology of how you intend to market your
services or products to the general public. In this section of the
business plan – we will overview how to showcase your services/products
to the general public.
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Marketing Overview Example
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The Donut Shop will place prominent signage on the facility to draw a
significant amount of foot traffic.
The business will maintain listings in the Yellow Books.
The Donut Shop will also maintain an internet website that showcases the
Company's operations, hours of operation, and relevant contact
information.

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Marketing Strategies Overview
Additionally, you will be required to further drill down (in your
business plan) how you intend to implement your strategies when you
launch or expand your business's operations. In this section of the
business loan and business plan documents, you should amplify the bullet
points from the section above. For instance:
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The Donut Shop intends to use a number of strategies that will create
instant traffic and customer flow to the Company's location. These
strategies include not only using prominent facility and road signage,
but also distributing flyers to people that fall into he Company's
targeted demographics. The business will also regularly take out
advertisements in localized newspapers that showcase the Company's hours
of operations, the donuts and pastries offered by the business, and
specials that are occurring within the store on a regular basis.
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The business will also maintain a highly informative website that
showcases the Donut Shop, its hours of operation, product listing
information, and other relevant information in regards to the Company's
pastry and donut products. This website will be listed on major search
engines such as Google as many people now use the internet to locate
local businesses. The business will also develop ongoing relationships
with caterers and local offices for regular delivery of donuts, pastries,
and coffee to their locations.
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The Financial Plan
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Beyond any other part of your business loan application or business plan,
the financials section of these documents are what matters most when
applying for a business loan or any other type of credit facility.
Ultimately, this section of the business plan showcases not only what
your anticipated profitability will be, but also how you intend to repay
the funds that you have borrowed through your business financing
facility. An example of how this section is structure is as follows:
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Assumptions
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Donut Shop, Inc. will have an average annual growth rate of 10% per year.
Mr. Doe will acquire $100,000 through a business loan in order to launch
the operations of the business.

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Proforma Financials for a Business Loan
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Now it is time to showcase how you intend to repay your loan, generate a
profit, and increase the book value of your business over a three to five
year period. BusinessPlansForLoan.com has developed an easy to use
financial model that you can use when drafting out the financial model
for your business plan and business loan application. Through your
business loan application, you will be required to have the following:
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Profit and Loss Statement for your Donut Shop
Cash Flow Analysis for the Donut Shop
Balance Sheet for the Donut Shop
Business Loan Amortization Tables
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