Feasibility Report Essay

The company lead wander custom-made cakes, cupcakes and java. The revenues from the p atomic number 18ntage entrust come from the sale of decorated cakes and cupcakes, as well as coffee for customers who visit the shop. The tune pull up stakes advertise revenue from service cake decoration and creation of the centerpieces of numerous of the approximately remarkable occasions of the lives of clients. Service revenue will come from divergent customized cake designs, decoration and bake creations. The line of reasoning will use many different designs as discussed by Graham (2007) and Wilson (2011). The major revenue seeded player during the initial year will be service revenue, including drink, cakes, and cupcakes sales. The occupancy includes move into service. It will have two ordering deli very(prenominal) channels promise orders and via online ordering. In addition, parking bays will be provided at a fee. The project revenue from parking bays will be $75000 per year. The revenue from the sale of cupcakes, cakes and drinks is communicate to be $ lakh yearly. The revenue from custom-making service will be $50000 annually. therefore, the totality projected revenue will be $225000. Cost DriversThe business will consider the make ups in order to stay in business (Marron, 2014) (Kidder, 2012 ). a) Upfront CostsSince the business is vernal, there will be some(prenominal) starting appeals beforeofficial opening. Upfront costs dwell of the purchase of furniture and fittings (table, chairs, coffee machines, installation of EFTPOS (electronic funds transfer at point of sale) and computers, cutlery, and front decoration (Ilasco and Seto, 2012 ) (Spencer, 2010). Advertising expenses will consist of the announce campaign in the initial year. The advertising drive will be geared towards increasing sales to cater for the some separate costs (Marquis, consider Media, 2014). Materials for shop decoration will be used to attract new customers. The tot al cost will include the cost of employing an interior designer. In addition, the business will consider the bond for the rent. This is because the expense must be stipendiary prior before the business is opened. There will be other upfront costs that will include the certificates and legislations required for the business opening (Department of Health, 2014). b) Fixed CostsOwing to the scenic area of Melbourne, the exalted cost of rent must be taken into account. Utilities like lighting, heating, peal lines, internet router and air conditioning have to be considered before the official opening. The business will choose a cheap electricity supplier. There are many to choose from (Smart Utilities, 2014). For an attractive design of the display in the shop, an interior designer with experience will be sought in one case per year. The cost associated with this will be recorded as expenses for design. Besides, the parking bays term of a contract will be a yearly fixed cost nonrecrea tional to Melbourne City Council (Hamer, Currie and Young , 2011). The parking bays will be provided to increase revenue. The business will take legislations into consideration, because set annual fees will have to be paid to the relevant bodies to ensure business continuation. c) Variable CostsThese are the expenses that will miscellany with the output of the business. The main variable cost in the cake and cupcake shop is raw materials used in the production of cupcakes, coffee and cakes such as lollies, vegetables, fruits, flour, milk, coffee beans and chocolate (Leach and Melicher, 2014). The cost of vegetables and fruits will change depending on seasonal and weather changes. There will be other variable costs like package expenses boxes, bags, staff wages and utilities. The workers in the shop will include1 baker1 decoratorJunior casual staffWages will be paid fortnightly. Additionally, the business will offer staff uniforms and training opportunities.There will be allowance of discount expenses owing to the high-inventory turnover and the need to come out fresh products. On special occasions, the business may have deals or offers that will reduce the unit profit. There will be other expenses like machinery maintenance, new fittings and insurance. These will be required as the business grows. resourcefulness Requirements/MappingHuman ResourceIt will be very easy to get the key employees as it will only ingest placing adverts on the street notice boards. There will be an added cost of interviews, as well as paying the Melbourne City Council (City of Melbourne, 2014).Physical ResourceProperty for lease is available in the area identified. Due to the tantrum of the area, the cost of lease is high. However, the expected returns are high. The business premises will be gotten under a one-year lease. This will save the cost that may be incurred in paying monthly costs. Similarly, it will stave off the costs associated with monthly rent increases. Financia l ResourceThe total inauguration cost is $130000. The business will raise $30000 and $ ten thousand0 will be obtained from the bank as loan. Costs for maintenance will be catered for by the revenue from the business. Investment SizeThe business plans to raise $130000 to meet its startup cost. The funds will be used for Developing the companys cupcake and cakes store locationFinancing for the first year of operation upper-case letter to buy baking equipment and ovensThe company will contribute $30000 to the venture. The remaining $100000 will be financed by the bank as loan. Projected inauguration CostsInitial Lease Payments and Deposits$20000Working Capital$60000Security Deposits$20000 start Supplies$10000Company Vehicle and Lease Deposits$2000Marketing Budget$10000Miscellaneous and Unforeseen Costs$8000Total Startup Costs$130000ReferencesAaron Marquis, inquire Media , 2014. The Average Profit Margin for a Cake Bakery. Online obtainable at http//smallbusiness.chron.com/average-pr ofit-margin-cake-bakery-14214.html Accessed 11 05 2014.Department of Health, V. A., 2014. Starting a food business. Online Available at http//www.health.vic.gov.au/foodsafety/bus/foodbus.htm Accessed 11 05 2014.Graham, J., 2007. The Crabapple Bakery Cupcake Cookbook. Print ed. London Penguin group (USA) Incorporated. J. Leach, Ronald Melicher, 2014 . Entrepreneurial Finance. 5 ed. Stamford Cengage Learning. Kidder, D., 2012 . The Startup Playbook Secrets of the Fastest-Growing Startups from Their Founding Entrepreneurs. Illustrated ed. San Francisco Chronicle Books. Marron, D., 2014. Cupcake Economics. OnlineAvailable at http//dmarron.com/2009/11/28/cupcake-economics/ Accessed 11 05 2014.Meg Mateo Ilasco, Catherine Seto, 2012 . Mom, Inc. The Essential Guide to caterpillar track a Successful Business Close to Home. Illustrated ed. San Francisco Chronicle Books. Melbourne, C. o., 2014. range and valuations. OnlineAvailable at https//www.melbourne.vic.gov.au/buildingandplanning/rat esandvaluations/Pages/RatesandValuations.aspx Accessed 11 05 2014.Paul Hamer, Graham Currie, William Young , 2011. Parking toll Policies A review of the Melbourne congestion levy. Australasian Transport Research meeting place 2011 Proceedings , 1(1), pp. 1-16. Spencer, P., 2010 . Start a Cupcake Business Today. London InformationTree Press. StartupBizHub, 2014. Starting a Cake Business. OnlineAvailable at http//www.startupbizhub.com/starting-a-cake-business.htm Accessed 11 05 2014.Utilities, S., 2014. Compare Electricity Rates in Victoria. Online Available at http//www.smartutilities.com.au/electricity-comparison-victoria/ Accessed 11 05 2014.Wilson, D., 2011 . Bakers house Guide to Cupcakes. Unabridged, reprint ed. New York City Houghton Mifflin Harcourt.