DESCRIPTION

HYUNA’S
PASTRY SHOP Hyuna’s Pastry Shop are retailers who bake and sell fresh
cakes, muffins, hot and cold pastries and more. Products
are baked on the premises and some cake specialize in
particular pastries, such as a Filipino patisserie.

Pastry shops produce a variety of cake types and sizes.

hyunaspastryshop@gmail.com
Customers planning a special occasion can order a
specially made bakery cake, for example, chocolate cake
or cheesecake, designed to feed a certain number of
people.
+639 954 458 457
(2) 4527 123
OBJECTIVE

1. To establish a working storefront for Morningstar

No. 1 Mt. Apo, East Tapinac,
Olongapo City, Zambales 2200 bakery.
2. To develop the strong presence in the community
www.hyunaspastryshop.com needed to support sales goals.
3. To develop a full menu by the end of the second
quarter.

PRODUCTS

Hyuna’s Pastry Shop offers a wide range of exciting

products. The first group is spelt breads, muffins, and
pastries. Spelt is used as there are far fewer people that are
allergic to this grain. Yeast allergies are also common and
Hyuna’s Pastry Shop offers a menu of yeast free breads.
 Dairy free muffins and pastries are offered for vegans.
Lastly, egg free breads, muffins, and pastries are offered.

ALLOCATION OF CAPITAL: with a capital of PHP 3 500 000.00 needed in order to start-up
the operation of the business, and PHP 346 500.00 savings.

EQUIPMENT PRICE
Bakery Oven 660 000
Bun and Sheet Pan Equipment 40 000
Dough Preparation Equipment 300 000
Bread Slicer Equipment 150 000
Refrigerator 75 000
Air Condition 50 000
Commercial Mixer 50 000
Holding and Proofing Cabinets 150 000
Bakery Work Tables 45 500
Utensil 10 000
TOTAL 1 530 500

SUPPLIES PRICE
Pest Control Product 5 000
Food Grade Lubricant 8 000
Cake Boxes 50 000
Piping Tip, Pastry Bag and Accessories 50 000
Cake Frosting 30 000
Garnishing Tools 20 000
Tiered Cake 15 000
Baking Ingredients 150 000
TOTAL 328 000

FURNITURE and FIXTURES PRICE

Bakery Display Case 150 000
Storage Cabinet 180 000
Front Desk 15 000

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TOTAL 345 000

OTHER EXPENSE PRICE

Salary Expense 80 000
Utilities Expense 70 000
Construction Expense 750 000
Insurance Expense 10 000
Rent Expense 30 000
Permit 20 000
TOTAL 960 000

PROJECTIVE INCOME
Service UNIT SRP PROFIT SOLD/ GROSS COGS GROSS
COST DAY SALES INCOME
Butter Cake 150 350 200 5 638 750 273 750 365 000
Pound Cake 150 350 200 3 383 250 164 250 219 000
Sponge Cake 150 350 200 6 766 500 328 500 438 000
Chiffon Cake 250 450 200 4 657 000 365 000 292 000
Red Velvet Cake 350 500 150 13 2 372 500 1 660 750 711 750
Muffins (6 pcs per box) 200 250 50 6 547 500 438 000 109 500
Cookies (6 pcs per box) 200 250 50 10 912 500 730 000 182 500
Bread 100 150 50 20 1 095 000 730 000 365 000
Cupcake ( 6 pcs per box) 150 185 35 15 1 012 875 821 250 191 625

TOTAL SALES 8 385 875 5 511 500 2 874 375

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BREAD AND BAKERY PRODUCTS

This commodity is for baked good including donuts, pies, cakes, and other items. The university has
strategic contracts with;

PROCUREMENT CONTACTS
For general inquiries on this commodity, contact:
Procurement.GeneralGoodsandServices@gmail.com

SUPPLIERS:
Chocolate Lover Incorporated
RRDT Enterprise Food Ingredients
Bake Et All

Baking Machinery Company

EFFICIENT MANAGEMENT OF CAPITAL FOR PROFIT MAXIMIZATION

 Research
Take a look around your neighborhood. Chances are that you aren't the only business selling
baked goods. Next to a cupcake store? In order to succeed, you need to set yourself apart from
the competition. Make sure that what you're offering is unique enough to draw repeat
customers rather than just occasional drop-ins.

MAKE YOUR BAKERY MATCH YOUR CUSTOMERS' NEEDS

The advantage that you have over larger franchises is that you can tailor your store specifically to your
clientele. Ask your customers what they'd like from their neighborhood bakery, and if you hear the

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same suggestion more than once, experiment with making changes. Are the majority of your
customer’s parents with young children searching for an after-school snack? Older retirees looking for
a quiet place to read the paper in the morning? Young professionals picking up breakfast on the go?
Determining what time of day your bakery is busiest (and what time of day you would like it to be the
busiest) can help you refine your menu and thus decrease the amount of waste product you have left
over at the end of the day. Not all bakeries need to open at 6 AM, and some bakeries—such as cupcake
or cookie bakeries that experience after-dinner traffic—may actually benefit from staying open later at
night. Tailoring your hours of operation to suit your customers' needs can help drive up your sales and
reduce the costs associated with having your bakery open during non-productive hours. Furthermore,
once you know what your peak hours are, you can more accurately understand how to better use your
space. If during your busiest hours you still have plenty of empty tables or a line that snakes all the
way out of the building, consider changing aspects of your space to more appropriately meet the
demand. If the size of your space isn't appropriate or isn't worth the cost, it may be time to look for a
new location.

TAKE ADVANTAGE OF SOCIAL MEDIA

Twitter, Instagram, Facebook, and Yelp can be indispensable for both attracting new clients and
keeping your current customers engaged. If your menu changes daily or you are carrying specialty
items for holidays, make sure your customers know about it. Posting attractive pictures of your baked
goods is a great way to peak potential customers' interest. Don't forget to include the bakery's phone
number in the caption so customers can easily place orders if they see something that catches their eye.
Also, take and post photos of your customers enjoying your store (with their permission of course).
Customers enjoy being appreciated and acknowledged for their patronage.

MAKE THE MOST OF YOUR PRODUCT

Recognize the difference between food trends and staples. Cakes, cookies, pies, and French pastries are
always going to be “in,” while cupcakes, marshmallows, whoopie pies, cake pops, ice cream cookies
sandwiches, etc., will come and go. That being said, there's certainly nothing wrong with a bakery that
focuses on a current trend, just so long as you are willing to take the potential risk and you realize that
it is highly unlikely to be a “forever” deal. Once you've decided what type of offerings you'd like to
have, consider offering corporate delivery or operating as a wholesale supply bakery for nearby
restaurants or cafes. Having these types of daily or weekly orders will ensure a steady flow of income
for your bakery, regardless of actual foot traffic. Lastly, think about offering drinks in your bakery as

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well. Drinks are an easy and non-labor-intensive way to bring in some extra money, and customers will
appreciate the convenience of being able to pick up their morning coffee or afternoon tea and a pastry
in the same location. You want the focus to be on your baked goods, of course, so offer a limited but
inclusive selection of drinks (teas, coffee, milk, water).

BUY INGREDIENTS IN BULK

You don't necessarily need to switch to margarine and egg-replacement in order to reduce your costs
associated with ingredients. In fact, depending on your customer-base, making these types of changes
may end up negatively affecting your business. Instead, do your research to make sure that you are
getting your necessary ingredients at the best price. Contact your local wholesale food stores and the
manufacturers directly to ensure that you are getting the best deal. If you know you are going to use a
large quantity of an ingredient—like flour or sugar—don't shy away from buying it in bulk. In general,
the larger quantity of an ingredient you buy, the cheaper it will be. Effective food storage may thus be
one of the most important and most frequently overlooked factors involved in reducing your expenses
and boosting your overall profit. Consider adding shelves and storage containers to maximize the
efficiency of your space.

BE A GOOD EMPLOYER

Employees that feel like they are being treated fairly and take pride in the business they work for can
truly make all the difference for your bakery. Employees that are paid an appropriate wage are more
likely to provide better customer service and stick around longer, thus increasing your profits and
decreasing the costs associated with the high turnover rate that plagues the restaurant industry. Paying
a higher wage will also provide a wider range of applicants for you to consider hiring. Be aware that
unlike restaurants and bars, bakeries are not known for providing much in the way of tips. Look into
purchasing a system such as Square to help you track your sales and boost your employees' tips.
Getting great customer service from long-term employees is worth the cost of paying them a bit extra.

Trial and error is a necessary step involved in making any business profitable, and being flexible and
willing to try out new ideas is a sure way to find your bakery's niche. Who knows, earning a profit for
your bakery may just be a few easy changes away.

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FINANCIAL PLANNING

SOURCE OF CAPITAL:
EXTERNAL:

25 % of the capital is from a short- term load on bank.

INTERNAL:

75 % own saving of the owners.

MANAGING RECEIVABLES

CREATE AN A/R AGING REPORT

The first step to take in your collections efforts is to determine the current payment status of all your
accounts receivable. This is done by creating an accounts receivable (A/R) aging report, which will
track and measure the payment status of all your customers. Accounts are broken out by the number of
days since the invoice was issued (such as 0-30 days, 31-60, 61-90 days, and beyond 90 days) and the
amounts due. This way, you can spot potential collection problems early, before accounts become
significantly past due, and focus your collection efforts more efficiently.

BE PROACTIVE IN YOUR INVOICING AND COLLECTIONS EFFORTS

There are usually things you can do when submitting invoices to help make it easier for your clients to
pay them. For example, make sure your invoices are clear and complete, with no missing information
that might cause your client's accounting department to kick it out of the system for further review.

MOVE FAST ON PAST-DUE RECEIVABLES

Studies have shown that the longer receivables go uncollected, the less likely they are to ever be
collected, either partially or in full. So day 45 is not the time to contact a client about a payment that
was due on day 30.

Instead, your accounting department should be calling or emailing clients the first day that payment is
late. Start with a gentle reminder that payment is now past due — this is usually sufficient to prompt
most clients to pay right away. Firmer communications may become necessary if payment is not

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forthcoming within a reasonable amount of time, including dunning letters informing clients that legal
action may commence if payment isn't received by a certain deadline.

CONSIDER OFFERING AN EARLY PAYMENT DISCOUNT

With a 2/10, net/30 discount, for example, customers will receive a 2 percent discount if they pay
within 10 days, instead of 30. While there is a cost to your business in offering such a discount, the
cash flow boost it provides could make it worthwhile.

CONSIDER OFFERING SOME PAST-DUE CLIENTS A PAYMENT PLAN

Your past-due client might inform you that they are having cash flow challenges of their own, and ask
for a little bit of help. In this scenario, you could offer the client a payment plan for the amount that's
past due. If so, be sure to put the plan and its terms in writing and have both parties sign it. And make
all future sales COD until the past-due amount is paid in full.

Mary order a layered chocolate, strawberry vanilla cake for the birthday of her daughter on
October 31, the cake price is 20, 000, and also she added a 200 pieces of cupcakes which is 10,
000. The total of Mary’s order is 30, 000. Our pastry shop would like to give Mary a discount if
she pays the cake and cupcakes much earlier.

30, 000 for cakes and cupcakes

10/2, 2/10, n/30

OCTOBER 3 – 27, 000

OCTOBER 11 – 29, 400

OCTOBER 31 – 30, 000

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 √2𝑥𝑅𝑥𝑂
MANAGING INVENTORIES
𝑖
Our pastry shop buys flour in 40-pound bags. The pastry shop uses an average of 12360 bags a year.
Preparing an order and receiving a shipment of flour involves a cost of 850 per order. Annual carrying
costs are 300 per bag.
√2𝑥12360𝑥850
Demand: 12 360 300
Order cost: 850
= 265 𝑝𝑒𝑟 𝑜𝑟𝑑𝑒𝑟

Holding cost: 300 How many times to order?

12360÷ 265
= 46 – 47 days
Working days? 365
365 ÷ 46
= 7 – 8 days

Piping bag, Pastry Bag, and

√2𝑥3000𝑥100
15
= 200 𝑝𝑒𝑟 𝑜𝑟𝑑𝑒𝑟
How many times to order?
3000÷ 200
= 15 days
Working days? 365
365 ÷ 15

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Accessories = 24 – 25 days
Demand: 3000

Order cost: 100

Holding cost: 15

√2𝑥5500𝑥350
Tiered Cake Supplies
25
Demand: 5500
= 393 𝑝𝑒𝑟 𝑜𝑟𝑑𝑒𝑟
Order cost: 350
How many times to order?
Holding cost: 25
5500÷ 393
= 13 - 14 days
Working days? 365

365 ÷ 13
= 28 – 29 days

Garnishing and Cake Frosting Tools

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Demand: 2500 √2𝑥2500𝑥150
Order cost: 150 60
Holding cost: 60 = 112 𝑝𝑒𝑟 𝑜𝑟𝑑𝑒𝑟
How many times to order?

2500÷ 112
= 22 - 23 days
Working days? 365

365 ÷ 22
= 16 – 17 days

MANAGING WORKING CAPITAL

 MAINTAINING WORKING CAPITAL IS EVERYBODY’S RESPONSIBILITY.

Many businesses rather shortsightedly imagine that working capital is solely the remit of the
finance team. Far from it. To succeed, a company should implement KPIs on working capital
that are understood by everyone in the management team. Where necessary, specialist training
should be delivered so that everyone shares the same outlook on financial management.

 PAY SUPPLIERS ON TIME.

At first glance, this suggestion may appear strange: surely paying as late as possible will
improve a company’s working capital? However, suppliers who are paid quickly and who do
not have to waste time chasing invoices are likely to be more flexible when it comes to prices
and terms of business.

Effective negotiating is central to every business, and it makes good sense to assign each
supplier a named contact who can build a close and mutually respectful working relationship.

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  WATCH YOUR STOCK.

Excessive stock holdings can tie up huge amounts of capital. Overbuying frequently results
from poor communication between departments and can be mitigated by monthly or quarterly
stock checks, provided they are quickly followed up with remedial action. At the same time, it
is crucial to avoid stock shortages, so this is something of a balancing act, requiring careful
attention to each product line.

 CONSIDER INTRODUCING E-PROCUREMENT.

E-procurement can reduce costs substantially: one survey indicated savings of 18 percent when
businesses used e-auctions and carefully compared different suppliers’ terms. Choosing
suppliers with longer payment terms can represent a huge boost to your working capital, so it is
worth carefully examining the small print and negotiating wherever possible. E-procurement
also involves a rigorous authorization process, which can assist in reducing unexpected
expenditures and protecting your working capital.

 Understand -what moves quickly, what contributes the highest gross margin, what core items of
stock are, what is aged or excess and what’s seasonal. This will help determine how much of
each line of stock to keep on hand and when a re-order is required.
o Implement and maintain sound physical controls to minimize perished stock or the risk
of theft.
o For a business that holds large quantities of stock, utilize a stock management record-
keeping system.
o Have a buying policy that covers areas such as?
 identification of core stock items and required levels to be on hand
 authorized suppliers, ensuring that there is not an over-reliance of one supplier
 policy on receiving discounts
–– bulk ordering and timing of stock orders (at what point does stock need to be
re-ordered)

DETECTING AND PREVENTING FRAUD

Segregation of duties – the lack of segregation of duties makes it easy for one individual to have
complete control over a process, such as procurement. Implementing segregation of duties will
disperse the responsibilities over more than one individual.

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Reviews and approvals – it is important that the review process for invoice payments is thorough and
complete in order for a reviewer to determine the legitimacy of the invoice and the vendor.

Vendor selection – the vendor selection process should include a bidding procedure and a due-
diligence process to determine that the vendor is genuine and that the company is getting a quote that is
reasonable based on other vendors in the market. Additionally, after the vendor is selected it should go
to a second party for final review and approval.

Automated controls – companies should implement automated controls to go along with manual
processes which are more prone to errors and fraud. Automated controls include processes in areas
such as payment and other systems that cannot be overwritten by a manual control.

Consistent vendor monitoring – it is recommended that an individual other than the one maintaining
a relationship with the vendor monitors vendor’s performance over time, to ensure expectations are
being met and maintained regarding service and performance. This will help to eliminate the likelihood
that fraudulent or fake vendors will be used in business.

Budget reviews – reviewing the budget to actual numbers will help a company to detect any outliers
from expectations, along with reviewing financial ratios to determine any numbers that are not
consistent with expectations.

Know Your Employees - it is prudent for management to be involved with their employees and take
time to get to know them because fraud perpetrators often display behavioral traits that can indicate the
intention to commit fraud and thus observing and listening to employees can help you identify
potential fraud risk. This can also reveal internal issues that need to be addressed such as an employee
who feels a lack of appreciation from management or anger at their boss which could lead him or her
to commit fraud as a way of revenge.

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Implement Internal Controls – management must implement strong internal controls to safeguard
company’s assets, ensure the integrity of its accounting records, and deter and detect fraud and theft
and a typical example is segregation of duties which can reduce the risk of fraud from occurring.

INCOME STATEMENT PRO FORMA PRO FORMA PRO FORMA

2018 2019 2020
SALES 8 385 875
COST OF GOOD SOLD (5 511 500)
GROSS INCOME 2 874 375
LESS: EXPENSES
 Salaries 80 000

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  Utilities 70 000
 Construction 750 000
 Insurance 10 000

 Rent 30 000

 Permit 20 000

 Supplies 328 000

NET PROFIT (LOSS) 1 586 375

TAX (475 912.5)
PROFIT AFTER TAX 1 110 462.5
BALANCE SHEET

CASH 3 210 875

OFFICE EQUIPMENT
OFFICE MACHINES 1 530 500
OFFICE FURNITURES 345 000
5 086 375
LOANS PAYABLE 875 000
CAPITAL 4 211 375
5 068 375

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