Table of Content

    Cookie Company business plan for starting your own business

    Food is one of the most lucrative businesses on the planet. If you want to enter this industry, opening a cookie company can be a very good option. In this cookie bakery business plan, we will look into how you can open such a business and run it in a profitable manner. This homemade cookies business plan will explain all the aspects of running the business. If you want to know how to start a cookie business, all you need to do is to read this document to the end. You can also use this document for creating a franchise business plan.

    Executive Summary

    2.1 The Business

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    For this cookie dough business plan, we will use the example of Steve Bakes. This will be a cookie company based in Houston, Texas. Steve Baker is starting a cookie business because it is his family business.

    2.2 Management of Cookie Company

    For anyone who wants to know how to start a cookie business, it is important to have a clear idea of how the company will be managed. To run the business the right way, Steve will hire managers to run the day-to-day affairs of the company. Steve will be the CEO of the company and all matters will be brought to his notice on a daily basis. Having a well-defined management structure of the company is not only necessary to run the business in a profitable manner but also for creating a business plan for a bank loan.

    2.3 Customers of Cookie Company

    Just like starting a coffee bean business, it is important to have an idea of the customers that you’ll be dealing with when you start a cookie company. The main customers of the company will be:

    • Private buyers who need the cookies for themselves.
    • Local retailers who need the cookies for their business.
    • Hotels, cafes and restaurants.
    • Hand-made cookie exporters.

    2.4 Business Target

    The next important thing that needs to be done before starting a business is to set a business target. The target of Steve Bakes will e to:

    • Become the best cookie maker in the city.
    • Expand the business to three more locations by the end of year one.
    • Start making $178,900 in profits by the end of year two.
    • Establish the name of the business as a top cookie brand in all of USA.

    Cooke Company Business Plan - 3 Years Profit Forecast

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    Company Summary

    3.1 Company Owner

    The business plan for homemade cookies needs to cover the owner of the company too. Steve Baker has been working in a bakery since he was 10. He knows a secret cookie recipe that is a part of his family’s legacy.

    3.2 Why the Cookie Company is being started?

    Steve wants to start a cookie business because he knows that no one can make better cookies than him. He wants to capitalize on the secret cookie making technique passed on to him by his father and his love for cookies. With such a fantastic technique and passion, nothing can stop him from starting this business.

    3.3 How the Cookie Company will be started?

    The steps involved in starting the cookie company are more or less the same as those seen in the restaurant business plan template. Here’s how this business will be started.

    Step1: Market Survey

    Like any other business, the first thing to do is to determine  how profitable is a cookie business and to do that, it is important to conduct a market survey. This will tell us the demand of the product and the profit margin we have. The cookie shop names will also be finalized on this stage.

    Step2: Marketing

    The next step in how to open a cookie business is to market the business. You need to reach as many people as you can in order to make sure that the business gets adequate customers once it is functional.

    Step3: Establishing the Bakery   

    Once you have started the marketing effort, it is the time to establish the bakery where the delicious treats will be made. Just like the juice corner business plan, you need to make sure that the capacity of the production unit is in line with the demand of the product.

    Step4: Going Online

    Once the bakery is being built, you need to establish a website and make an online presence so that your customers can order the cookies easily. As all businesses these days have an online presence, this is very important to compete in the market.

    Cooke Company Business Plan - Startup Cost

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    Start-up Expenses
    Legal $251,000
    Consultants $0
    Insurance $30,000
    Rent $28,000
    Research and Development $25,000
    Expensed Equipment $53,000
    Signs $4,100
    TOTAL START-UP EXPENSES $391,100
    Start-up Assets $340,000
    Cash Required $357,000
    Start-up Inventory $38,000
    Other Current Assets $234,000
    Long-term Assets $278,000
    TOTAL ASSETS $1,247,000
    Total Requirements $1,638,100
    START-UP FUNDING
    Start-up Expenses to Fund $391,100
    Start-up Assets to Fund $1,247,000
    TOTAL FUNDING REQUIRED $1,638,100
    Assets
    Non-cash Assets from Start-up $1,625,000
    Cash Requirements from Start-up $380,000
    Additional Cash Raised $52,000
    Cash Balance on Starting Date $39,000
    TOTAL ASSETS $2,096,000
    Liabilities and Capital
    Liabilities $29,000
    Current Borrowing $0
    Long-term Liabilities $0
    Accounts Payable (Outstanding Bills) $47,000
    Other Current Liabilities (interest-free) $0
    TOTAL LIABILITIES $76,000
    Capital
    Planned Investment $1,638,100
    Investor 1 $0
    Investor 2 $0
    Other $0
    Additional Investment Requirement $0
    TOTAL PLANNED INVESTMENT $1,638,100
    Loss at Start-up (Start-up Expenses) $381,900
    TOTAL CAPITAL $2,020,000
    TOTAL CAPITAL AND LIABILITIES $2,096,000
    Total Funding $1,638,100

    Services

    A cookie company might appear to be a straightforward business but, as a matter of fact, you can include a number of different services in your cookie shop business plan.

    Note

    Remember, the more services you offer, the more profit you can make. This cookies business plan sample includes some of the services that you can provide. You can also include more if you want.

    The services that are a part of this cookie business plan template are:

    Hand-Made Cookie Production

    The basic service of the business will be the production and delivery of hand-made premium cookies.

    Custom Cookies

    People who want custom-made cookies can commission us to make cookies as per their demands.

    Custom Cakes

    Custom birthday, wedding, and other celebration cake designing, and production will also be one of the services provided by Steve Bakes.

    Bakery Training

    We will also include an apprenticeship program in the services for aspiring bakers to come and learn from our cookie making.

    Marketing Analysis of Cookie Company

    The single most important thing that you need to do to start cookie business I the marketing analysis of the business and the market you are going to enter. This is important because no matter how good you know how to sell cookie dough, if you are not aware of market dynamics, you’ll fail.

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    5.1 Market Trends

    If you know how to create your own cookies, the thing that you need to know next is the market trends of the business so that you can run it in a profitable way. There are a number of different cookie marketing ideas that can be used to advertise the business and attract customers. However, none of them will work if you do not know how to start your own cookie business.

    5.2 Marketing Segmentation

    The next thing that you need to know in order to start a successful cookie business is to have an idea of market segments that you will be serving. Here’s a rough idea of the market segments you’ll be dealing with:

    Cooke Company Business Plan - Marketing Segmentation

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    5.2.1 Private Customers

    People who like cookies and want to buy premium hand-made cookies will be the main customers of the business.

    5.2.2 Retail Stores

    Retail stores in the area who want to add cookies to their stock will be another market segment for us.

    5.2.3 Cafes, Bars and Restaurants

    Local cafes, bars, and restaurants will also be among the market segments and will buy the product in bulk.

    5.2.4 Exporters

    Export businesses specializing in hand-made cookies will also be a lucrative market segment for the business.

    Market Analysis
    Potential Customers Growth Year 1 Year 2 Year 3 Year 4 Year 5 CAGR
    Private Customers 33% 30,000 32,000 34,000 35,000 36,000 10.00%
    Retail Stores 26% 23,000 25,000 27,000 29,000 30,000 10.00%
    Cafes, Bars and Restaurants 24% 20,000 23,000 25,000 27,000 28,000 10.00%
    Exporters 17% 13,000 14,000 16,000 18,000 19,000 11.00%
    Total 100% 86,000 94,000 102,000 109,000 113,000 10%

     

    5.3 Business Target

    When people explain how to open a cookie business, they tend to forget business targets. Here are the targets set by Steve Bakes.

    • To become the best premium hand-made cookie maker in the city.
    • To provide healthy and tasty cookies to everyone.
    • To expand the business to other cities and then states.
    • To make a ton of money.

    5.4 Product Pricing

    Just like we did in the business plan for cafe, we will price the product at the market average. Our product will be of better quality than any of the competitors and having a price similar to what people are already paying will help us get customers. Once we start getting enough customers, we can then increase the prices.

    Marketing Strategy

    The next thing that you need to start this business is a solid marketing plan for cookie business. The business plan for a bakery cannot be complete without it. Especially, if you are starting a cookie business at home, you need to be clear about how the business will be started and how it will be marketed. This part of this cookie making business plan deals with the marketing part of the business. This is because no cookies business plan sample can be complete without it.

    6.1 Competitive Analysis

    Here’s the competitive analysis of this cookie bouquet business plan:

    1. No one in the area offers handmade and custom cookies.
    2. The cookies available in the area are expensive and really not up to the mark.
    3. The bakeries that do offer cookies are often out of stock.
    4. Once we attract enough customers, we can sell the cookies at whatever price we want.
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    6.2 Sales Strategy

    • The business will be advertised over all the local and national marketing channels. This will make the business known to everyone who a customer can be.
    • The focus of the business, in the start, will be to earn customers rather than making huge profits.
    • Discounts and special offers will be offered to the repeat customers and bulk buyers.

    6.3 Sales Monthly

    Cooke Company Business Plan - Sales Monthly

    6.4 Sales Yearly

    Cooke Company Business Plan - Sales Yearly

    6.5  Sales Forecast

    Cooke Company Business Plan - Unit Sales

    Sales Forecast
    Unit Sales Year 1 Year 2 Year 3
    Hand-Made Cookie Production 55,000 58,300 61,798
    Custom Cookies 40,000 42,400 44,944
    Custom Cakes 34,000 36,040 38,202
    Bakery Training 28,000 29,680 31,461
    TOTAL UNIT SALES 157,000 166,420 176,405
    Unit Prices Year 1 Year 2 Year 3
    Hand-Made Cookie Production $45.00 $52.20 $60.55
    Custom Cookies $50.00 $58.00 $67.28
    Custom Cakes $60.00 $69.60 $80.74
    Bakery Training $75.00 $87.00 $100.92
    Sales
    Hand-Made Cookie Production $2,475,000.00 $3,043,260.00 $3,741,992.50
    Custom Cookies $2,000,000.00 $2,459,200.00 $3,023,832.32
    Custom Cakes $2,040,000.00 $2,508,384.00 $3,084,308.97
    Bakery Training $2,100,000.00 $2,582,160.00 $3,175,023.94
    TOTAL SALES $8,615,000.00 $10,593,004.00 $13,025,157.72
    Direct Unit Costs Year 1 Year 2 Year 3
    Hand-Made Cookie Production $43.00 $49.00 $56.00
    Custom Cookies $48.00 $55.00 $63.00
    Custom Cakes $58.00 $66.00 $76.00
    Bakery Training $73.00 $84.00 $96.00
    Direct Cost of Sales
    Hand-Made Cookie Production $2,365,000.00 $2,856,700.00 $3,460,688.00
    Custom Cookies $1,920,000.00 $2,332,000.00 $2,831,472.00
    Custom Cakes $1,972,000.00 $2,378,640.00 $2,903,382.40
    Bakery Training $2,044,000.00 $2,493,120.00 $3,020,236.80
    Subtotal Direct Cost of Sales $8,301,000.00 $10,060,460.00 $12,215,779.20

    Personnel plan

    The next important part of this cookie bakery business plan is the personnel plan. This is the part where we discuss the manpower required to run the business. As the main products of the business will be handmade and custom cookies, we will need quite a bit of workers to run this cookie business from home. That means, while answering the question how to start an online cookie business, it is important to mention how many people will be needed to operate it.

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    7.1 Company Staff

    The following people will be needed to run the business:

    • Steve Baker, the owner, will be the CEO of the business.
    • 1 shopkeeper for operating the factory outlet.
    • 3 managers will be hired for sales, operations, and marketing.
    • 4 Bakers.
    • 3 delivery drivers.
    • 1 accountant.

    7.2  Average Salary of Employees

    Personnel Plan
    Year 1 Year 2 Year 3
    Sales Manager $13,000 $14,300 $15,730
    Marketing Manager $13,000 $14,300 $15,730
    Operations Manager $14,000 $15,400 $16,940
    Bakers $40,000 $44,000 $48,400
    Shopkeeper $9,000 $9,900 $10,890
    Delivery Drivers $27,000 $29,700 $32,670
    Accountant $9,000 $9,900 $10,890
    Total Salaries $125,000 $137,500 $151,250

    Financial Plan

    When you offer homemade cookies for sale, the first thing that you need to decide is how much does a cookie cost you to manufacture. What most manufacturers fail to realize is the cost of the cookie is not just the cost of the dough used to make it. You need to include everything from the cost of starting the business to running it in order to get the correct estimate of the cost of the product.

    The money needed to start this home bakery business plan will include:

    • The cost of buying land to build the bakery.
    • Marketing costs.
    • Cost of making a website.
    • Salary of the employees.
    • Cost of raw materials to make the cookies.
    • Cost of registration and insurance.

    8.1 Important Assumptions

    General Assumptions
    Year 1 Year 2 Year 3
    Plan Month 1 2 3
    Current Interest Rate 8.12% 8.15% 8.22%
    Long-term Interest Rate 8.39% 8.46% 8.51%
    Tax Rate 24.01% 24.50% 25.80%
    Other 0 0 0

    8.2 Break-even Analysis

    Cooke Company Business Plan - Break-even Analysis

    Break-Even Analysis
    Monthly Units Break-even 5341
    Monthly Revenue Break-even $133,100
    Assumptions:
    Average Per-Unit Revenue $234.00
    Average Per-Unit Variable Cost $0.66
    Estimated Monthly Fixed Cost $163,400

    8.3 Projected Profit and Loss

    Pro Forma Profit And Loss
    Year 1 Year 2 Year 3
    Sales $8,615,000 $10,593,004 $13,025,158
    Direct Cost of Sales $8,301,000 $10,060,460 $12,215,779
    Other $0 $0 $0
    TOTAL COST OF SALES $8,301,000 $10,060,460 $12,215,779
    Gross Margin $314,000 $532,544 $809,379
    Gross Margin % 3.64% 5.03% 6.21%
    Expenses
    Payroll $125,000 $137,500 $151,250
    Sales and Marketing and Other Expenses $120,000 $130,000 $140,000
    Depreciation $2,200 $2,300 $2,500
    Leased Equipment $0 $0 $0
    Utilities $2,900 $3,000 $3,100
    Insurance $2,100 $2,100 $2,100
    Rent $2,800 $2,900 $3,100
    Payroll Taxes $30,000 $31,000 $32,000
    Other $0 $0 $0
    Total Operating Expenses $285,000 $308,800 $334,050
    Profit Before Interest and Taxes $29,000 $223,744 $475,329
    EBITDA $29,000 $223,744 $475,329
    Interest Expense $0 $0 $0
    Taxes Incurred $5,800 $44,749 $95,066
    Net Profit $23,200 $178,995 $380,263
    Net Profit/Sales 0.27% 1.69% 2.92%

    8.3.1 Profit Monthly

    Cooke Company Business Plan - Profit Monthly

    8.3.2 Profit Yearly

    Cooke Company Business Plan - Profit Yearly

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    8.3.3 Gross Margin Monthly

    Cooke Company Business Plan - Gross Margin Monthly

    8.3.4 Gross Margin Yearly

    Cooke Company Business Plan - Gross Margin Yearly

    8.4 Projected Cash Flow

    Cooke Company Business Plan - Projected Cash Flow

    Pro Forma Cash Flow
    Cash Received Year 1 Year 2 Year 3
    Cash from Operations
    Cash Sales $55,000 $59,400 $64,152
    Cash from Receivables $20,000 $21,600 $23,328
    SUBTOTAL CASH FROM OPERATIONS $75,000 $81,750 $88,290
    Additional Cash Received
    Sales Tax, VAT, HST/GST Received $0 $0 $0
    New Current Borrowing $0 $0 $0
    New Other Liabilities (interest-free) $0 $0 $0
    New Long-term Liabilities $0 $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 $75,000 $82,000 $89,000
    Expenditures Year 1 Year 2 Year 3
    Expenditures from Operations
    Cash Spending $41,000 $42,000 $44,000
    Bill Payments $25,000 $28,000 $31,000
    SUBTOTAL SPENT ON OPERATIONS $66,000 $70,000 $75,000
    Additional Cash Spent
    Sales Tax, VAT, HST/GST Paid Out $0 $0 $0
    Principal Repayment of Current Borrowing $0 $0 $0
    Other Liabilities Principal Repayment $0 $0 $0
    Long-term Liabilities Principal Repayment $0 $0 $0
    Purchase Other Current Assets $0 $0 $0
    Purchase Long-term Assets $0 $0 $0
    Dividends $0 $0 $0
    SUBTOTAL CASH SPENT $66,000 $71,280 $76,982
    Net Cash Flow $20,000 $21,000 $22,000
    Cash Balance $26,000 $29,000 $33,000

    8.5 Projected Balance Sheet

    Pro Forma Balance Sheet
    Assets Year 1 Year 2 Year 3
    Current Assets
    Cash $275,000 $308,000 $338,800
    Accounts Receivable $23,000 $25,760 $28,954
    Inventory $4,100 $4,592 $4,900
    Other Current Assets $1,000 $1,000 $1,000
    TOTAL CURRENT ASSETS $283,000 $316,960 $356,263
    Long-term Assets
    Long-term Assets $10,000 $10,000 $10,000
    Accumulated Depreciation $19,000 $21,280 $23,940
    TOTAL LONG-TERM ASSETS $22,300 $24,976 $28,098
    TOTAL ASSETS $295,000 $330,400 $371,700
    Liabilities and Capital Year 4 Year 5 Year 6
    Current Liabilities
    Accounts Payable $18,800 $21,056 $23,667
    Current Borrowing $0 $0 $0
    Other Current Liabilities $0 $0 $0
    SUBTOTAL CURRENT LIABILITIES $19,000 $21,280 $23,919
    Long-term Liabilities $0 $0 $0
    TOTAL LIABILITIES $17,000 $19,040 $21,401
    Paid-in Capital $30,000 $30,000 $31,000
    Retained Earnings $56,000 $61,040 $67,144
    Earnings $198,000 $215,820 $237,402
    TOTAL CAPITAL $286,000 $311,740 $342,914
    TOTAL LIABILITIES AND CAPITAL $303,000 $330,400 $371,700
    Net Worth $294,000 $320,460 $352,506

    8.6 Business Ratios

    Ratio Analysis
    Year 1 Year 2 Year 3 INDUSTRY PROFILE
    Sales Growth 7.22% 8.00% 8.86% 3.00%
    Percent of Total Assets
    Accounts Receivable 9.18% 10.17% 11.27% 9.80%
    Inventory 5.39% 5.97% 6.62% 9.90%
    Other Current Assets 2.11% 2.34% 2.59% 2.40%
    Total Current Assets 150.02% 152.00% 152.00% 158.00%
    Long-term Assets 11.45% 11.49% 11.64% 12.00%
    TOTAL ASSETS 100.00% 100.00% 100.00% 100.00%
    Current Liabilities 4.90% 4.94% 4.98% 4.34%
    Long-term Liabilities 0.00% 0.00% 0.00% 0.00%
    Total Liabilities 7.61% 7.67% 7.74% 7.38%
    NET WORTH 100.90% 101.71% 102.64% 110.00%
    Percent of Sales
    Sales 100.00% 100.00% 100.00% 100.00%
    Gross Margin 94.80% 97.36% 100.09% 99.00%
    Selling, General & Administrative Expenses 94.00% 96.54% 99.24% 97.80%
    Advertising Expenses 1.56% 1.60% 1.65% 1.40%
    Profit Before Interest and Taxes 42.60% 43.75% 44.98% 33.90%
    Main Ratios
    Current 34 35 36 32
    Quick 33 33.6 34.44 33
    Total Debt to Total Assets 0.18% 0.18% 0.17% 0.40%
    Pre-tax Return on Net Worth 74.08% 75.02% 75.10% 75.00%
    Pre-tax Return on Assets 94.67% 99.40% 104.37% 111.30%
    Additional Ratios Year 1 Year 2 Year 3
    Net Profit Margin 32.40% 33.40% 34.44% N.A.
    Return on Equity 55.00% 56.71% 58.46% N.A.
    Activity Ratios
    Accounts Receivable Turnover 7.7 7.8 7.8 N.A.
    Collection Days 100 100 100 N.A.
    Inventory Turnover 32 33.6 33 N.A.
    Accounts Payable Turnover 15 16 16.3 N.A.
    Payment Days 27 27 27 N.A.
    Total Asset Turnover 2.5 2.5 2.6 N.A.
    Debt Ratios
    Debt to Net Worth -0.04 -0.03 -0.04 N.A.
    Current Liab. to Liab. 1 1 1 N.A.
    Liquidity Ratios
    Net Working Capital $248,900 $262,838 $277,557 N.A.
    Interest Coverage 0 0 0 N.A.
    Additional Ratios
    Assets to Sales 0.86 0.87 0.87 N.A.
    Current Debt/Total Assets 1% 0% 0% N.A.
    Acid Test 29.1 29.12 29.16 N.A.
    Sales/Net Worth 2.1 2.2 2.3 N.A.
    Dividend Payout 0 0 0 N.A.

    Frequently asked questions of the cookie business

    Answer the following questions in your cookie business plan –

    • Will you offer cookies online or sell locally, or both?
    • If online, how you are going to ensure safety in shipping?
    • What makes your recipes unique?
    • How you are going to market cookies?
    • Do you have proper licenses and permits to start your business?

    Download Cookie Company Business Plan Sample in pdf