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Business Plan
Emily Hulse, Jordan Diehl, Katie Rexrode, Scottie Thompson, Emily Helms,
and Lily Akinosi
Sweet Scoops Homemade Ice Cream
12106 Boydton Plank Road
Dinwiddie, VA 23841
804-469-4690 (phone)
804-469-0964 (fax)
SweetScoops@gmail.com
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I.
Table of Contents
I.
Table of Contents ................................................................................................... 2
II.
Executive Summary ............................................................................................... 3
III.
General Company Description ............................................................................ 4
IV.
Products and Services............................................................................................ 6
V.
Marketing Plan ....................................................................................................... 7
VI.
Operational Plan .................................................................................................. 13
VII. Management and Organization ......................................................................... 17
VIII. Startup Expenses and Capitalization ................................................................ 18
IX.
Financial Plan ....................................................................................................... 21
X.
Appendices ........................................................................................................... 25
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II.
Executive Summary
Our business is called Sweet Scoops Homemade Ice Cream. We are located in
Dinwiddie County, Virginia by Interstate 85 near Petersburg and Colonial Heights. The
business site will be split into three parts of rooms. The first is for the making of our ice
cream, cakes, floats, and waffle cones. The second room will be for eating in seating for
our many customers. The third will be available to be rented out for parties when our
business expands and gains a reputation in later years. Our many products will include
ice cream, cake, floats, and waffle cones. The population within a 5-mile radius will be
our starting customer base and it will hopefully then expanded to the surrounding
counties and cities. The owners in the LLC are as follows: Emily Hulse, Jordan Diehl,
Katie Rexrode, Scottie Thompson, Emily Helms, and Lily Akinosi. For the future, our
business will be strong and profitable because of the low direct competition, the
uniqueness of our flavors, and our great customer service.
All members of the LLC will put in $20,000 to begin and if more is needed we will then
apply for a loan.
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III.
General Company Description
We are a homemade ice cream business. We will provide delicious homemade dairy
creations to our customers.
Mission Statement: We are the homemade ice cream shop that offers specialty
homemade ice cream and cones, found nowhere else, in a family environment.
Company Goals and Objectives: Our first goal is to establish a loyal, local customer
following. We will measure this by the number of repeat customers we have within a six
month period from the surrounding county. Our goal is to have 40% repeat customers
by the end of the first six months. We would then like to spread our customer base to
the surrounding counties including Prince George, Dinwiddie, and Chesterfield along
with the cities of Colonial Heights, Petersburg, and Fort Lee. Our objective is to provide
a positive experience for our customers. To evaluate this, we will have our customers fill
out surveys. Our goal is to have an average score of 8.5 out of 10 from the surveys. We
want to have a positive impact on the community. To achieve this, our company needs
to be profitable. By the end of the first year, we would like to have increased sales by
20%. Each following year, we want annual sales to increase by 10%.
Business Philosophy: Our customer service and satisfaction is the most important thing
to our business. Happy and satisfied consumers make long term loyal customers. We
are marketing our products to the locals in the Dinwiddie area. The total adult
population with a 1-mile radius is 356. The total adult population within a 3-mile radius
is 1,591. The total adult population within a 5-mile radius of our business is 3,532.
DeWitt County demographics are 64% Caucasian and 34% African American. There are
9,107 households in the county. Out of those households, 32% have children under the
age of 18 living with them. The median income for a household is $41,582. We are going
to target the immediate customer basis surrounding our business since they are the most
likely to come to our business on a regular basis.
Our industry, ice cream, is eight billion dollars annually. There are 368 businesses
employing 19,910 people. There has been little growth in this industry. However, it is
expected that it will increase at an annual rate of 1.4% until 2017. We foresee little direct
competition in the short term in the location of our business. However there are indirect
competition by local stores and chains. Long term we expect some competition but we
hope to distinguish ourselves and create a large following. This would allow our
business to expand. Our company is poised to take advantage of them because we
prepared to listen and respond to our consumers. We chose this location because we
saw it as an opportunity due to the low competition.
Our most important company strengths is our ability to provide value for our customers.
We will provide multiple unique flavors of ice cream that can be found nowhere else.
The customers can drive what flavors are available in our store. We can learn from other
businesses’ mistakes on what flavors to avoid. Our core competencies include great
customer service in a family environment. Our business will succeed because of our
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great products and great service in a timely manner. Our major competitive strengths
are the unique flavored ice cream, cakes, floats, and flavored waffle cones. One of our
main partners has experience in the homemade ice cream industry. The other investors
have experience in customer service. We expect to bring new ideas and innovation to the
business.
Legal form of ownership: We have chosen to be a Limited Liability Company or LLC.
We have selected this form because it offers limited liability along with some tax
advantages.
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IV.
Products and Services
We are going to provide ice cream, ice cream cakes, and cold drinks for our customers.
Our products are unique because they are made on sites and on a daily basis. This
ensures freshness. We will allow customers to influence what flavors they want each
season. Our ice cream will be homemade, and we will also make our waffle cones. Our
toppings will vary among sprinkles, cookie dough bites, and a variety of candies, fruits,
and syrups. We have a waffle bowl special that includes three scoops, and two toppings.
We are also going to have waffle cone chips that will act as dippers in the ice cream.
Another specialty of ours that will attract young customers and their families will be
flavored/colored waffle cones. Our ice cream cakes will come in three different sizes,
personal, 9 inch round cake, or 9x12 sheet cake, and can be personalized. We will also
have an area designated for the soda machines that we will also use to make floats.
Advantages: We will have a family friendly environment for customers to enjoy their ice
cream indoors and also picnic tables outside for the warmer summer months. We will
have the best homemade ice cream, and we specialize in the different types of cones,
cakes, and floats. The closest ice cream shop is 11 driving miles from Sweet Scoops. One
of our main partners has former experience in a successful homemade ice cream store.
Disadvantages: We are new to the area, and many people do not know who we are, so
therefore we will have to work harder to build a strong customer base in the community
and we will rely on these customers to spread the word about our business and their
satisfaction. There is also the fact that we have no proprietary recipes, but statistics show
that the area does not have these options available to consumers currently.
Prices
1 Scoop=2.25
2 Scoops=3.75
3 Scoops=4.50
4 Scoops=5.00
Waffle Cones=.45
Waffle Chips=1.00
Waffle Bowl=1.25
Personal Cake=7.50
Round Cake=14.25
Sheet Cake=25.50
Floats -5.00
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V.
Marketing Plan
Economics
The ice cream industry is an eight billion dollar market annually. There are
approximately 368 major ice businesses that employ 19,910 individuals. Since we are a
small, local homemade ice cream shop, we do not expect to be a major factor in the
market. There has been little growth in this industry in recent years because of the
economy. However, secondary data shows that the ice cream industry is expected to
increase at an annual rate of 1.4% until 2017. The trends in the target market have stayed
the same. Ice cream has always been a family treat and it remains a family treat.
Consumers have started to have preferences for new, exotic flavors and non-traditional
combinations. The product development trends have stayed the same. Our business has
the potential to grow but it will be difficult. Since we are a homemade ice cream store,
our product has a higher starting price than what some people are used to paying for ice
cream. We have to provide outstanding ice creams in order to even out the extra cost.
Some barriers that we face entering this market with our new business include high
capital costs and consumer acceptance. There are a few pieces of equipment that our
business requires that are very expensive. For example, a new 24 flavor ice cream case is
16,000 dollars. A new ice cream maker is approximately 20,000 dollars depending on the
size. Having equipment to buy that is expensive right away puts pressure on our ability
to raise equity in the beginning of our business. Since we are a brand new business, our
customers will have never heard of our company or product in general. Dinwiddie
County does not have the small, homemade ice cream shops. There are some chain stores
but they are further away from our business’s location. We have to gain consumer
approval and build a local customer base. We can overcome the high capital costs barrier
by raising a large amount of owners’ equity. Each of our six investors is putting $20,000
dollars into the business. This gives our company a start-up of $120,000 without
considering any loans we plan to take out. Having this much start-up should remove the
barrier to high capital costs. The quality of our product should help us with the barrier of
consumer acceptance. We will also offer discounts early on to our customers to try and
get them used to the higher prices. Changes in technology don’t really affect our business
except that it would maybe allow us to make our ice cream quicker and more efficiently.
Changes in government regulations would make us follow higher sanitary standards.
Changes in the economy would affect our business. An increasing economy would mean
our customers have more money to spend on luxuries like homemade ice cream. A
decrease in the economy would make it harder for us to compete for the customer’s few
dollars. Our industry is starting to change somewhat. Customers expect new, innovative
flavors. Ice cream is also starting to be shipped right to the customers from online as gifts.
However, the traditional walk-in ice cream store will still be around so we do not expect a
lot of change in our industry.
Product - Features and Benefits
Sweet Scoops offers traditional and unique homemade ice cream flavors, waffle cones,
waffle bowls, milkshakes, ice cream cakes, cold drinks, ice cream floats, and toppings. The
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ice cream flavors are special because they are homemade and the customers are able to
direct what types of flavors are available. The waffle cones and bowls are special because
they have traditional and non-traditional flavors and colors. The milkshakes and ice cream
floats are unique because feature the homemade ice cream with unique combinations.
Sweet Scoops also has a large variety of cold drinks. The customers are able to ask and
order individual, special requests. Sweet Scoops also has a huge variety of toppings. The
products offer a lot of variety for the customer usually found at a larger business but at a
higher quality and in a family oriented shop. The products give the customers satisfaction
or utility. Sweet Scoops is able to provide large orders for families and other businesses.
We will be giving our customers frequent buyer cards, which has a reward of a free scoop
after seven purchases.
Customers
We are marketing our products to the locals in the Dinwiddie area. The total adult
population with a 1-mile radius is 356. The total adult population within a 3-mile radius
is 1,591. The total adult population within a 5-mile radius of our business is 3,532.
DeWitt County demographics are 64% Caucasian and 34% African American. There is
not a significant amount of Native Americans (0.22%), Pacific Islanders (0.40%), or
Hispanics (0.97%). Dinwiddie County has a total population of 28,001. The population
has growth 14.1% in the last ten years. There are 6,720 families and 9,107 households in
the county. Out of those households, 32% have children under the age of 18 living with
them. The average household size was 2.58 while the average family size was 3.01. The
median income for a household is $41,582. The per capita income for the county was
$19,122. 9.3% of the population is below the poverty line. The median age is 38 years.
There are 98.8 males for every 100 females. We are going to target the immediate
customer basis surrounding our business since they are the most likely to come to our
business on a regular basis.
Competition
Our direct competitors include other businesses that offer food and beverages. One
specific competitor is businesses that offer ice cream. Indirect competitor are other places
where our customers could be spending the same money they use at our business.
List your major competitors:
Dairy Queen- 294 Southpark Circle, Colonial Heights, VA
Scotty’s Ice Cream and Snack Bar- 106 North Sycamore Street, Petersburg, VA
Jersey Mike’s Subs- 2011 Boulevard, Colonial Heights, VA
Bruster’s Real Ice Cream- 11731 Sherbet Ln, Chester, VA
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Friendly’s Ice Cream Shop- 2520 West Hundred Road, Chester, VA
Baskin Robbins- 5113 Oaklawn Boulevard, Hopewell, VA
Sweet Frog- 11932 Iron Bridge Plaza, Chester, VA
Country Style Ice Cream- 4220 Celebration Avenue, Chester, VA
Cold Stone Creamery- 13261 Rittenhouse Lane, Midlothian, VA
Sweet Frog- 7321 Hancock Village Drive, Chesterfield, VA
Food Lion- 13103 Boydton Plank Road, Dinwiddie, VA
Family Dollar #7642- 13076 Boydton Plank Rd, Dinwiddie, VA
Food Barn- 14011 Boydton Plank Rd, Dinwiddie, VA
Dinwiddie Exxon- 19520 Carson Road, VA
Dollar General- 13509 Boydton Plank Road, Dinwiddie, VA
Regal Cinema- 300 Southpark Circle, Colonial Heights, VA
Blockbuster Express- 6460 Boydton Plank Road, Petersburg, VA
Our direct competitors are other ice cream businesses but they are all located in other
cities. This gives us an advantage on convenience. We will also have a better quality of
product. Our indirect competitors are other businesses where our customers could be
spending the same amount of money. In the case of our business, we have more
important indirect competitors since they are located closer to our business. However, we
will compete by providing a higher quality product in a more family-friendly
environment.
Table 1: Competitive Analysis
Factor
Products
Price
Sweet Scoops
Homemade unique
products
Strength Weakness Sweet Frog
X
More expensive
Offers variety of frozen Local, convenient has
yogurts
large variety
X
Importance to
Customer
5
Has a high price
Cheaper
4
High quality
X
Good quality
Lower quality (freshness,
etc.)
5
Large variety
X
Large variety
Large variety
4
Quality
Selection
Food Lion
10
Sweet Scoops
Personal, individual
service
X
Personal service
No real service
4
Service
Has the same quality
for all products
X
Offers same quality of
products daily
Offers same variety year
round
4
Reliability
Unlikely to close
Unlikely to close
3
Uncertainty on future
Stability
X
Food Lion
Some expertise
X
More expertise
Expertise not needed
4
Good
X
Good
Good
4
Convenient
X
Inconvenient
Well-kept, family
friendly, unique
X
Individual, Specific
X
Individual, Specific
Standardized
2
Pay at time of purchase
X
Pay at time of purchase
Pay at time of purchase
3
Has more
Has more
2
Good
good
3
Expertise
Company
Reputation
Location
Appearance
Sales Method
Credit Policies
Strength Weakness Sweet Frog
Importance to
Customer
Factor
Advertising
Not a lot of advertising
good
Image
Standardized to franchise Standardized to franchise
X
X
Convenient
5
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Sweet Scoops has an advantage in that we provide a family friendly environment for
customers to enjoy their ice cream indoors and also picnic tables outside for the warmer
summer months. We will have the best homemade ice cream, and we specialize in the
different types of cones, cakes, and floats. The closest ice cream shop is 11 driving miles
from Sweet Scoops. One of our main partners has former experience in a successful
homemade ice cream store. We have a disadvantage in that we are new to the area, and
many people do not know who we are, so therefore we will have to work harder to build
a strong customer base in the community and we will rely on these customers to spread
the word about our business and their satisfaction. There is also the fact that we have no
proprietary recipes, but statistics show that the area does not have these options available
to consumers currently.
Niche
Sweet Scoops has a niche with middle class families. Our product is a little too expensive
for lower income families. These lower income families might buy our product every
once in a while as a treat but they will be less likely to buy our ice cream on a regular
basis. We have a niche with middle class families because they can more easily afford our
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product and we provide a nice family friendly environment where they can spend a nice
afternoon or evening as a family.
Strategy
We can market our niche by putting up flyers around middle class neighborhoods and at
other businesses. We also plan to use Facebook. Sweet Scoops will send discount cards to
the local schools that will be sent home to the students’ families.
Promotion
News of our business will mostly be spread by word of mouth. For prior working
experience, we have seen that newspaper advertisements do not work very effectively.
Advertisement on radio stations and TV are too expensive for a small business like Sweet
Scoops. So we plan to distribute flyers and discount cards to the immediate area around
our business. This makes sure that the individuals who live closest to our business our
aware of us. We will do this every month with a description of the unique flavors and
deals being offered that particular month. We will also use Facebook. Sweet Scoops is
trying to use less expensive advertising since we are a small business who has high capital
costs. We will not have a lot of extra cash in the beginning of our business. We will have
an opening day to introduce a large number of people to our product. It will be a familyfriendly event with music and free food. We want our customers to view us a familyfriendly ice cream store who offers a large variety of goods for a good value. One of
Sweet Scoops’ investors has experience in graphics. He will be in charge of graphic image
support. This will include a logo design, cards, brochures, and signage. The interior
design was chosen by all six investors. We are planning on having a customer database
that informs us of birthdays. We will be giving our customers a free scoop of ice cream on
our birthday. Sweet Scoops will also have a frequent buyer card which will let us be
aware and reward who are most loyal customers are.
Promotional Budget
We plan to have an annual budget of $3,000 for advertising. This comes out to $250 a
month for advertising. We believe this will be sufficient because we are mostly relying on
word of mouth and Facebook to make customers aware of our business.
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Pricing
We set our prices according to the input costs and in accordance to other similar products.
We tried to set average prices when looking at other similar businesses. This means we
didn’t choose the lowest price but we also didn’t choose the highest prices. With having
average prices, we are hoping to compete with the quality of our product and service.
Even with setting average prices, our pricing strategy still has us being more expensive
than our competitors. However, we can compete by providing better quality and a better
experience for the customer. Our prices are higher because we hand make all of our ice
creams and we put the best ingredients in them.
Price is not the most important competitive factor. Quality is the most important
competitive factor. Our customers do consider prices to be important but not to the
detriment of quality. Our policy is that the customers come first. This is why customers
are able to influence what flavors we will provide. Our credit policy is that the customers
pay up front for their purchase.
Proposed Location
We have chosen an exact location for our business. Our business will be at 12106 Boydton
Plank Road in Dinwiddie, VA. This location is central to the local population. It is also
surrounded by populous counties that include Prince George and Chesterfield. The
populous cities that are located near the business are Colonial Heights, Petersburg, and
Fort Lee. It also offers easy access because it is located near Highway 1 and Interstate 85.
The location has a lot of parking for the customers. It also provides both outside and
indoor seating. Customers are easily able to access our business by car or on foot. The
exterior is nicely done and is well kept. It does stay consistent with our family-friendly
image. Our customers expect to be able to get in and out quick or stay to enjoy their ice
cream. This location offers both. Our business is located far from our direct competition so
this offers us an advantage. However, it is still close enough to indirect competition so our
business is not located inconveniently for our customers.
Distribution Channels
Our product will be sold on site to individuals and larger groups. We also offer to make
larger orders for bigger events. However, these orders have to be picked up by the
customer.
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VI.
Operational Plan
Production
Our products will be made on sites. They will also be made daily as needed. We do this
in order to ensure the quality of our products. Freshness is a quality we guarantee our
customers and is one of our strengths. We are also able to make specialty flavors that our
customers request because of our unique production method. The main product we will
use is the Emery Thompson Ice Cream Maker. This machine costs approximately 22,000
dollars. However, it comes with a warranty so if anything mechanical goes wrong with it,
we will be covered. Each container of ice cream will cost approximately five to seven
dollars depending on the ingredients. Each container holds five liters, which is
approximately 169 ounces. To ensure quality control, we will have detailed instructions
for each flavor of ice cream for our employees to follow. We will also taste test each ice
cream before it is available to our customers. New flavors will go through extensive taste
testing before it is available for sale. We want to make sure it measures up to our high
quality standards. Our employees will be given a customer service manual to read and
know before they start working. During their first two weeks of working, one of the
managers will work with the new employee to ensure they learn our methods of customer
service. In our business, the customer is always right and if find faults with our product
we try to fix the complaint and make up for the mistake/error. We watch our inventory
daily to ensure that we do not run out of flavors. We check inventory three times a day:
once in the morning, once at mid-business day, and once at the end of business hours. We
remake our ice cream as needed. To ensure we can guarantee our customers the flavors
they want, we always have one back-up for each flavor. Product development goes
through an extensive process. To make sure the flavors are up to our high standards, we
have our employees and others test new flavors. Only when there is agreement on the
product is it available to customers.
Location
The location of business is approximately 1,800 sq. feet and is a rental space in a strip mall
shopping center. The zoning of the building we will rent is B-2. The power and other
utilities will be provided by Dominion, Virginia Power, and ARWA. It is crucial for our
business to be convenient to transportation for our customers and suppliers. The store’s
location provides easy walk-in access, which will serve as way to attract more customers.
Our parking is shared with the other stores in the shopping center and is conveniently
located out-front. We are not planning to make any substantial changes to the structure
rather than adding two sinks in the back for the production of ice cream. Our rent is set at
$2,000 per month with the maintenance costs included. The utilities cost per month will be
approximately $750, insurance $400, and the initial remodeling costs will be $4000. Our
business hours for the slow months (November through April) will be 1-7pm and during
the busier months (May through October) our hours will be extended, 1-11pm.
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Legal Environment
There are multiple regulations that our homemade ice cream store must follow and
abide by. The permit holder of the license should be the person in charge or should
designate a person to be in charge in the ice cream shop during all hours of operation. In
order to prevent illness, we must have a certified food protection manager, we must list
the capacity of the building,, and that depends on how many table there are provided in
the actual shop. We must have properly designed, constructed, located, installed,
operated, maintained, and cleaned products and equipment. We must follow the safety
instructions for cleaning and sanitizing utensils and the places that customers touch.
Employees must not tamper with the products we are selling because it could lead to
airborne sickness and illness.
For our ice cream shop, a license is necessary for us to conduct business in Dinwiddie
City. We must have a license number for everything we use so that when advertising is
used, people can look up our past history with the Better Business Bureau to check our
performance with the license number. We must have a basic business operation license, a
Federal Employer Identification Number, a Fictitious Business name permit, zoning and
land use permits, health department permits, a sales tax license, and fire department
permits.
We will follow the Department of Dairy Product Regulations, such that ice cream cannot
contain less than 26 percent solids, no less than 10 percent milk fat, or when chocolate
syrup, cocoa, fruit, nuts, or confections have been added, 8 percent milk fat, and not less
than 180 grams of solids per liter. Because we are selling homemade ice cream we must
have a sign that displays in large letters that we sell it and it must be placed in a location
where it can be noticed by all. Since we are a new business, we are required to have a
building permit that includes electrical, plumbing, mechanical, remodeling, alterations,
and additions so that when we have to have a business inspection, we are covered under
those things mentioned in the permit. We will have an insurance policy that covers
damage to property and any injuries that someone may be held responsible for. Another
thing we must get, is a trademark for our business so that we don’t have other people
using the same name and logo as us.
Personnel
There will be the six partners working in the Sweet Scoops as employees. One of the
partners, Emily Hulse, has had previous work in a homemade ice cream shop, unlike the
others who have yet to work in one. We will add employees if, and only if, we see it
necessary after the first year of business. To go about that, the future employee can ask
any of the current managers for an application, which they must fill out in the store, and
return to the manager. We will then decide from the information given if we think they
will be a good employee or not. The employee will be paid the minimum wage of $7.50
per hour. They will be able to earn tips that will be recorded at the end of the night.
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The quality of the current staff is excellent. The customer service is excellent and we work
very hard in order to maintain a good quality with our customers. Everyone that will
work for Sweet Scoops, must go through certain training sessions that will allow them to
be fully prepared for working in the store. Everyone must know how to do every step of
the job, from making the ice cream, to standing behind the cashier to ring it up. We will
have a board that will show each employee’s name, with a grid that we will mark off for
every time they complete a training session, so that our customers are also aware that our
employees will know how we are doing. In order to complete the training process, there
will be a specific list. Once the employee can show the manager that they can do
everything on the list, then the box under the specific column for that employee will be
checked off. There are job descriptions for each position which must be fulfilled when
working
Inventory
We keep a large supply of raw ingredients. We are able to do this because a lot of our
ingredients have a long shelf life. Raw ingredients include chocolate, canned fruit
topping, fudge, candy toppings, waffle mix, vanilla, flavoring, cake mixes, etc. However,
we keep a much smaller supply of ice cream mix, milk, and fresh fruits. This is because
they have a shorter shelf life. They need to be used up quicker. By keeping a smaller
supply, we eliminate waste. These ingredients are relatively easy to acquire and can be
ordered daily or weekly. We keep a large supply of cups, spoons, napkins, bowls, cup
lids, bowl lids, etc. We keep a back-up of every finished ice cream flavor. At the end of
the day or as needed, we restock our flavors. We have a start-up value of stock that is
approximately 5,000 dollars. As this start-up inventory is used up, we will restock it. We
need the most inventory during the summer because it is our busiest season. During the
winter, we keep the least amount of inventory. We use this time to make new flavors.
Our customers need to give us at least one week notice for when they want a special
flavor or a large amount of ice cream. Payment is due at the time of exchange.
Suppliers
Our key suppliers will be: 1.) Panza & Sons - Ltd. 50-60 Parkway Place, Edison, NJ 08837,
2.) Central Restaurant Products – 7759 Georgetown Rd., Indianapolis, IN46268, 3.) Carry
Out Supplies – 167 N. Sunset Ave., City of Industry, CA 91746, and 4.) Frozen Dessert
Supplies – 67 S. Higley Rd., Gilbert, AZ 85296.
We plan to have an inventory of 80 chairs, 40 tables, 20 booths, 1,000 spoons, 1,000 cups,
50 ice cream flavors, and 50 ice cream toppings.
We do not sell on credit. We also do not buy on credit usually. Our delivery policy is
that the customer should receive their order as quickly as possible without sacrificing the
quality of the order.
Credit Policies
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We do not plan to sell on credit. In our industry, it is not customary to sell on credit.
Thus, it is not expected by our clientele. In general, the sale amount is not extensive
enough to call for sales on credit.
Managing Your Accounts Payable
We plan to pay our suppliers at the time of purchase. This method means we do not need
to pay interest. It also allows us to be aware of how much cash we have on hand for the
rest of the month since most supplies are bought at the beginning of the month. The
exception to this is the ice cream mix, milk, and fresh fruit. Since our business does not
require an extensive inventory, there is no problem of cash shortages.
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VII. Management and Organization
Our store will be managed on a day-to-day basis by each of our six owners, with the
seventh day being a Monday when our entire team of owners will meet. Each owner
will be assigned a day of the week to work half of the day as a laborer and spend the
other half of the day advising the hired employee. On the Monday of each month we
will gather the past week’s business reports and evaluate the store’s and employee’s
performance. One of our six owners is currently employed by Harvey’s, an ice shop in
Bridgewater, Virginia. This owner has brought a lot of experience to the table and has
helped the other owners in understanding their duties and what types of business skills
are needed to successfully run our store. She has experience in working with the
customers and understanding and fulfilling their wants and needs. These skills will be
useful in our goal of creating a strong and loyal customer base. If this person is lost or
incapacitated, the business will easily continue because we, the owners, will constantly
consult each other on our strategies and goals.
Professional and Advisory Support
•
Board of directors- Emily Hulse, Katie Rexrode, and Jordan Diehl
•
Management advisory board- Emily Helms, Lillie Akinosi, and Scottie Thompson
•
Attorney- Lanning Rainey
•
Accountant- Carl W. Wells
•
Insurance agent- William H. Talley & Sons Inc.
•
Banker- Bank of Southside Virginia
•
Consultant or consultants – Maria Lugo
•
Mentors and key advisors- Harvey Wayne Elliot
18
VIII. Startup Expenses and Capitalization
The research we completed in order to make our expenses was very extensive. We
even contacted the local ice cream shop owner and asked him about some of his
expenses in order to make sure that we were in line with how he was.
We also used turnkeryparlor.com as a reference to what the average yearly operating
costs were for our business. For our expenses we knew that we needed new machinery
and decided we needed at minimum $50,000 for just that, along with our rent of $2,000
per month and how we would remodel the building with a budget $10,000. With just that
we knew we needed to have sizeable bank loans to cover our investments and to have
cash in hand for change, misfortunes, etc. We then decided to split the amount we would
need into four (4) different banks, borrowing from each $37,500, and also each owner
contributing $20,000 and having equal ownership of the business.
Startup Expenses
Sweet Scoops
Sources of Capital
Owners' Investment (name and
percent ownership)
Katie Rexrode
Scott Thompson
Emily Hulse
Jordan Diehl
Dorcas Akinosi
Emily Helms
$
20,000
20,000
20,000
20,000
20,000
20,000
Total Investment
$
120,000
Bank Loans
Bank 1
Bank 2
Bank 3
Bank 4
Total Bank Loans
$
-
$
-
Other Loans
Source 1
Source 2
Total Other Loans
Startup Expenses
Buildings/Real Estate
$
19
Purchase
Construction
Remodeling
Other
Total Buildings/Real Estate
Leasehold Improvements
Item 1
Item 2
Item 3
Item 4
Total Leasehold Improvements
Capital Equipment List
Furniture
Equipment
Fixtures
Machinery
Other
Total Capital Equipment
Location and Admin Expenses
Rental
Utility deposits
Legal and accounting fees
Prepaid insurance
Pre-opening salaries
Other
Total Location and Admin Expenses
Opening Inventory
Ice Cream and ingredients
utensils
cleaning supplies
Total Inventory
Advertising and Promotional
Expenses
Advertising
Signage
Printing
Travel/entertainment
Other/additional categories
Total Advertising/Promotional
Expenses
$
$
$
$
$
$
$
$
$
$
6,000
12,000
18,000
-
10,000
50,000
7,500
67,500
2,000
1,000
2,500
400
2,436
8,336
2,000
750
1,000
3,750
$
500
2,000
500
-
$
3,000
$
$
-
Reserve for Contingencies
$
-
Working Capital
$
-
Other Expenses
Other expense 1
Other expense 2
Total Other Expenses
rent 2000 a month
sinks / plumbing / rewiring
20
Summary Statement
Sources of Capital
Owners' and other investments
Bank loans
Other loans
Total Source of Funds
Startup Expenses
Buildings/real estate
Leasehold improvements
Capital equipment
Location/administration expenses
Opening inventory
Advertising/promotional expenses
Other expenses
Contingency fund
Working capital
Total Startup Expenses
$
120,000
$
120,000
$
6,000
10,000
67,500
8,336
3,750
3,000
20,000
15,000
$
133,586
Security and Collateral for Loan Proposal
Collateral for Loans
Real estate
Other collateral
Other collateral
Other collateral
Owners
Katie Rexrode
Scott Thompson
Emily Hulse
Jordan Diehl
Dorcas Akinosi
Emily Helms
Value
-
Description
21
IX.
Financial Plan
Our major assumptions are that we will receive the cash immediately and that we would
pay for everything upon delivery. These two things will greatly affect our cash flow in
that if we pay for something and don’t receive the right thing we will be at a loss and not
be able to make the flavor we need to make. Since our sales should be almost immediate
we don’t foresee a problem with having cash coming in.
Some of our expenses are payable in advance, for example rent can be paid in advanced
and insurance is usually paid either bi-yearly, quarterly or yearly. In this way we could
pay off bills when we could in our high profit months so that when we don’t have as
many customers coming in our expenses wouldn’t be near as high.
We should make sure that we have cash in hand in order to pay for machine maintenance
and repairs or any plumbing problems we run into. During our busy times of the year it
would also be a good idea to begin stocking up on supplies early so that we don’t run out
and can always please our guests.
ProForma Balance Sheet
Sweet Scoops
Opening Day
as of 06/10/2013
End of Year 1
as of 06/10/2014
Assets
Current Assets
Cash in bank
Accounts receivable
Inventory
Prepaid expenses
Other current assets
Total Current Assets
Fixed Assets
Machinery & equipment
Furniture & fixtures
Leasehold improvements
Land & buildings
Other fixed assets
(LESS accumulated
depreciation on all fixed
assets)
Total Fixed Assets (net of
depreciation)
Other Assets
Intangibles
Deposits
Goodwill
$
$
$
15,000
3,750
8,336
27,086
$
50,000
17,500
1,000
-
$
30,000
10,500
900
-
$
72,000
3,750
75,750
$
68,500
$
41,400
$
-
$
-
22
Other
Total Other Assets
$
-
TOTAL Assets
$
95,586
$
-
-
$
$
117,150
Liabilities and Equity
Current Liabilities
Accounts payable
Interest payable
Taxes payable
Notes, short-term (due
within 12 months)
Current part, long-term debt
Other current liabilities
Total Current Liabilities
$
-
-
-
$
-
$
-
Long-term Debt
Bank loans payable
LESS: Short-term portion
Other long term debt
Total Long-term Debt
$
-
$
-
Total Liabilities
$
-
$
-
Invested capital
Retained earnings beginning
Retained earnings - current
$
120,000
Total Owners' Equity
$
120,000
$
120,000
Total Liabilities & Equity
$
120,000
$
120,000
Owners' Equity
-
Cash Flow (12
months)
PreStartu
p EST
Jan13
$
120,000
-
Sweet
Scoops
Feb13
Mar
-13
Apr
-13
Ma
y13
Jun
-13
Jul13
Au
g13
Se
p13
Oct
-13
No
v13
Fiscal Year
Begins:
Jan
-13
Dec-13
Tot
al
Item
EST
23
Cash on Hand
(beginning of
month)
13,4
76
11,9
52
10,
428
8,9
04
8,2
40
8,6
36
11,
692
14,
748
15,
944
15,
966
14,
442
12,918
4,00
0
4,00
0
4,0
00
4,0
00
6,0
00
8,0
00
10,
000
10,
000
8,0
00
6,0
00
4,0
00
4,000
72,0
00
0
4,00
0
4,00
0
4,0
00
4,0
00
6,0
00
8,0
00
10,
000
10,
000
8,0
00
6,0
00
4,0
00
4,000
72,0
00
15,000
17,4
76
15,9
52
14,
428
12,
904
14,
240
16,
636
21,
692
24,
748
23,
944
21,
966
18,
442
16,918
72,0
00
3,750
750
750
750
750
750
750
750
750
750
750
750
750
9,00
0
1,43
6
1,43
6
1,4
36
1,4
36
2,4
36
2,4
36
2,4
36
2,4
36
2,4
36
1,7
50
1,4
36
1,436
22,5
46
250
250
250
250
250
250
250
250
250
250
250
250
3,00
0
Accounting & legal
208
208
208
208
208
208
208
208
208
208
208
208
Rent
2,00
0
2,00
0
2,0
00
2,0
00
2,0
00
2,0
00
2,0
00
2,0
00
2,0
00
2,0
00
2,0
00
2,000
Utilities
200
200
200
200
200
1,0
00
200
200
200
200
200
200
Insurance
400
400
400
400
400
400
400
400
400
400
400
400
Taxes (sales 7%)
280
280
280
280
420
560
700
700
560
420
280
280
5,52
4
5,52
4
5,5
24
5,5
24
6,6
64
7,6
04
6,9
44
6,9
44
6,8
04
5,9
78
5,5
24
5,524
15,000
CASH
RECEIPTS
Cash Sales
Collections fm CR
accounts
Loan/ other cash
inj.
TOTAL CASH
RECEIPTS
Total Cash
Available (before
cash out)
CASH PAID
OUT
Purchases
(merchandise)
Purchases
(specify)
Purchases
(specify)
Gross wages
(exact withdrawal)
Payroll expenses
(taxes, etc.)
Outside services
Supplies (office &
oper.)
Repairs &
maintenance
Advertising
Car, delivery &
travel
2,50
0
24,0
00
Telephone
3,20
0
4,80
0
5,04
0
Interest
Other expenses
(specify)
Other (specify)
Other (specify)
Miscellaneous
SUBTOTAL
Loan principal
payment
Capital purchase
(specify)
Other startup costs
Reserve and/or
Escrow
Owners'
Withdrawal
3,750
74,0
86
24
TOTAL CASH
PAID OUT
3,750
5,52
4
5,52
4
5,5
24
5,5
24
6,6
64
7,6
04
6,9
44
6,9
44
6,8
04
5,9
78
5,5
24
5,524
Cash Position
(end of month)
11,250
11,9
51
10,4
28
8,9
04
7,3
80
7,5
76
9,0
32
14,
748
17,
804
17,
140
15,
988
12,
918
11,394
74,0
86
2,08
6
ESSENTIAL OPERATING DATA (non
cash flow information)
Sales Volume
(dollars)
Accounts
Receivable
Bad Debt (end of
month)
Inventory on hand
(eom)
Accounts Payable
(eom)
Depreciation
4,00
0
4,00
0
4,0
00
4,0
00
6,0
00
8,0
00
10,
000
10,
000
8,0
00
6,0
00
4,0
00
4,000
72,0
00
0
0
0
0
0
0
0
0
0
0
0
0
0
25
X. Appendices
Photos of Location
25
26
Map
Business Card
Sweet Scoops
Homemade Ice Cream
12106 Boydton Plank Road
Dinwiddie, VA 23841
804-469-4690
SweetScoops@gmail.com
26
27
Customer Appreciation Card - Marketing
Sweet Scoops Homemade Ice Cream
Customer Appreciation Card
1
2
3
4
5
6
For each scoop of ice cream you buy, we will stamp your card…
You will receive one free scoop of ice cream after your seventh scoop!
Flyer of Grand Opening
27
28
Flyer of Weekly Flavors
Weekly Specials of Sweet Scoops
June 1-7
Fudge Chocolate Brownie
Strawberry Cheesecake
Lemon-Lime Sorbet
Remember you can suggest new flavors!
There is a suggestion box by the door!
28
29
Basic Start-Up Web Page (It will be worked on more before we open
and updated frequently after that to keep our customers in the loop.)
About Us Page file:///C:/Users/owner/AppData/Local/Microsoft/Windows/Temporary%20Internet%20F
iles/Content.IE5/WYSF0YF2/BUS%20120%20Business%20page%28about%29.html
Home Page file:///C:/Users/owner/AppData/Local/Microsoft/Windows/Temporary%20Internet%20F
iles/Content.IE5/DS08TXR1/BUS%20120%20Business%20page%28home%29.html
Menu Page file:///C:/Users/owner/AppData/Local/Microsoft/Windows/Temporary%20Internet%20F
iles/Content.IE5/HMYTCOVB/BUS%20120%20Business%20page%28menu%29.html
Letters of Support from Future Customers
June 20, 2012
Sweet Scoops Homemade Ice Cream
12106 Boydton Plank Road
Dinwiddie, VA 23841
Dear Sweet Scoops Homemade Ice Cream,
I just heard that you are planning on opening a business in Dinwiddie, VA. I was so
excited to hear this news. Our area is really lacking in variety for ice cream. They are
the generic suppliers like Dairy Queen, Cold Stone Creamery, and Baskin Robbins but
they are all located an inconvenient distance from Dinwiddie. I have visited Harvey’s
Homemade Ice Cream in Bridgewater while I was dropping my son off at Bridgewater
29
30
College. I really enjoyed the ice cream I had there and I have heard that your business
will be similar because one of your investors previously worked for Harvey’s. Thank
you for investing in Dinwiddie and giving us a new place to try exciting flavors in a
family environment.
Sincerely,
Krista Smith
November 15, 2012
Sweet Scoops Homemade Ice Cream
12106 Boydton Plank Road
Dinwiddie, VA 23841
Dear Sweet Scoops Homemade Ice Cream:
I have heard rumors that your new ice cream store will be opening in my home county
of Dinwiddie, Virginia. I was thrilled to discover that these rumors were true! Our
options when taking our young children out for ice cream are limited to buying it in the
grocery stores within our area. A few ice cream shops are located too far out of our area
and in the busy city where traffic is usually troublesome. My husband and I are excited
to have an ice cream shop just a quick jog or bike ride away. We promise to tell all of
our friends and encourage them to try your new shop, also! I see a successful future for
the business of Sweet Scoops Homemade Ice Cream. Our children our getting more
excited every day!
Your future loyal customers,
The Garrison’s
September 5, 2012
Sweet Scoops Homemade Ice Cream
12106 Boydton Plank Road
Dinwiddie, VA 23841
Dear Sweet Scoops,
I am so excited to finally have a HOMEMADE ice cream shop near my house. I have
been looking forward to having one for so long! I never thought that it would happen,
30
31
and then her you come! I know that you are going to have the best ice cream around,
and I won’t have to drive very far to get ice cream then. It is so nice for you to be
located just a few miles away from me. My family and I are so happy and ready for you
to open. We wish you the best of luck as you open, and we can’t wait to be some of
your very best customers.
Looking Forward To It!
The Duncan Family
Equipment to Purchase Immediately
Emery Thompson 6 Quart Gelato, Ice Cream, and Sorbet Freezer (Model CB-350 Air
Cooled) - $19,900 (Stand not included - $453.00)
Aspen Deluxe for Gelato or Ice Cream 24 flavors - $16,000
31
32
GE 13.7 cu. Ft. Frost-Free Upright Freezer: 3 - $1,587)
GE 18.1 cu. Ft. Freestanding Refrigerator/Top Freezer - $498.00
Chef’s Choice M838 Waffle Cone Iron/Maker -$47.99
32
33
Kalorik Stainless Steel Drink Mixer DRM 39135 - $60.00
Cruisinart SmartPower CPB 300 Blender - $70.00
Deni 6200 Automatic Stainless Steel Ice Crusher - $42.00
33
34
Equipment to be Purchased Later
Delfield T14D Convochill T Series Blast Chiller/Shock Freezer - $20,132.00
34