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Writing a Business Plan
While it may be tempting to put off, creating a business plan is an essential part of starting your own business. Plans and proposals should be put in a clear format making it easy for potential investors to understand. Because every company has a different goal and product or service to offer, there are business plan templates readily available to help you get on the right track. Many of these templates can be adapted for any company. In general, a business plan writing guide will recommend that the following sections be incorporated into your plan.
Executive Summary
The executive summary is the first section that business plans open with, but is often the last section to actually be written as it’s the most difficult to write. The executive summary is a summary of the overall plan that highlights the key points and gives the reader an idea of what lies ahead in the document. It should include areas such as the business opportunity, target market, marketing and sales strategy, competition, the summary of the financial plan, staff members and a summary of how the plan will be implemented. This section needs to be extremely clear, concise and engaging as you don’t want the reader to push your hard work aside.
Company Description
The company description follows the executive summary and should cover all the details about the company itself. For example, if you are writing a business plan for an internet café, you would want to include the name of the company, where the café would be located, who the main team members involved are and why, how large the company is, who the target market for the internet cafe is, what type of business structure the café is, such as LLC, sole proprietorship, partnership, or corporation, what the internet café business mission and vision statements are, and what the business’s short-term objectives are.
Services and Products
This is the exciting part of the plan where you get to explain what new and improved services or products you are offering. On top of describing the product or service itself, include in the plan what is currently in the market in this area, what problems there are in this area and how your product is the solution. For example, in a business plan for a food truck, perhaps there are numerous other food trucks in the area, but they are all fast –food style and unhealthy so, you want to introduce fast food that serves only organic and fresh ingredients every day. This is where you can also list your price points and future products or services you anticipate.
Market Analysis
The market analysis section will take time to write and research as a lot of effort and research need to go into it. Here is where you have the opportunity to describe what trends are showing up, what the growth rate in this sector looks like, what the current size of this industry is and who your target audience is. A cleaning business plan, for example, may include how this sector has been growing by 10% every year due to an increase in large businesses being built in the city.
Organization and Management
Marketing and sales are the part of the business plan where you explain how you will attract and retain clients. How are you reaching your target customers and what incentives do you offer that will keep them coming back? For a dry cleaner business plan, perhaps if they refer customers, they will get 10% off their next visit. In addition, you may want to explain what needs to be done in order for the business to be profitable. This is a great way of showing that you are conscious about what clear steps need to be taken to make a business successful.
Financial Projections & Appendix
The financial business plan section can be a tricky one to write as it is based on projections. Usually what is included is the short-term projection, which is a year broken down by month and should include start-up permits, equipment, and licenses that are required. This is followed by a three-year projection broken down by year and many often write a five-year projection, but this does not need to be included in the business plan.
The appendix is the last section and contains all the supporting documents and/or required material. This often includes resumes of those involved in the company, letters of reference, product pictures and credit histories. Keep in mind that your business plan is always in development and should be adjusted regularly as your business grows and changes.
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Your Guide to Writing a Business Plan
If you’re starting a new business, then you need an effective plan. Not only does this enable you to plan your company, but it also gives potential clients an insight into how your business works. A business plan is also vital if you want to attract investors or secure a loan from the bank. Drafting a business plan is a complex process, but it doesn’t have to be. This guide will ensure you create a definite plan to impress investors and clients.
When creating your business plan, there are some essential elements you must include. The Executive Summary provides a description of your business, and what you hope to achieve. People usually write at least one page, but leave their Executive Summary until last.
You’ll also need to detail what your business offers and define your target audience. This makes it easier for people to see whether your company has a chance of succeeding. The opportunity section is also an excellent way for you to see what competitors offer and how you can create a USP to stand out from the competition.
Appealing to Investors
Every business that wants growth and prosperity must ensure they promote themselves to potential investors. Business plans aren’t just about what the business is, but who is part of it too. Detail your current team members and explain what they bring to the company. Investors want to know they’re making a wise investment.
Your current finances and financial forecast are also essential aspects of your business plan. Look at your products, how much you’re selling them for and what kind of profit margin you expect to gain. It’s also vital you detail your outgoings and look at how various economic situations could affect your finances.
Writing a Winning Executive Summary
There are problems in every market, and a successful business solves that problem. If you can show how you’ll be able to offer solutions in your business plan, you’ll appeal to investors. Choose your target audience based on research and ensure you show your research. There are many ways to conduct market research including defining SOMs, SAMs and TAMs.
TAM stands for Total Available Market and comprises everyone you want your product to reach. Your Segmented Addressable Market (SAM) is a specific portion of the market you’ll target. This is important because it shows you’re able to direct your product at the right people and not just everyone. Your SOM (Share of the Market) is what you feel you’ll gain with your product.
How to Determine Pricing
Pricing your product is one of the most challenging things you’ll have to do. There are many things to consider, such as how much it’s worth and making sure you don’t charge unrealistically. Many new businesses believe undercharging is the best way to go, but doing this can undermine your company’s authority and cause fewer people to be interested in investing.
Market-based pricing involves looking at your competitors and evaluating their prices. Which company has the most customers? How does their pricing match others? These are all vital aspects you should consider. Remember, customers expect quality and a fair price, so make sure you combine the two.
Future Goals
Investors and banks want to know that you’ve considered what the future will hold for your company. When you write your business plan, be sure to take into account how you see the company growing, what you’ll do to ensure it thrives and that you understand the potential risks. Banks and investors want to know that you can build a business and are aware of the obstacles you’ll have to overcome.
Starting your own business doesn’t have to be difficult. If you ensure you produce a robust business plan, it can be an exciting process. Your business is part of your future, so start by outlining your goals and look forward to seeing results.
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A Complete Kitchen & Cookware Store Business Plan: A Key Part Of How To Start A Kitchen Supply Store
By In Demand Business Plans
( 2 ratings )
About this ebook
THIS BOOK IS A COMPLETED KITCHEN & COOKWARE STORE BUSINESS PLAN and it is provided to you with all the additional information you will need to complete your own. Starting and operating your own business is not just the American dream, it is the pathway to wealth. And a business plan is critical to forming the right strategy and taking the steps needed to ensure success. THIS IS NOT A BASIC TEMPLATE. This book, unlike so many others, has actually done most of the work for you. While most books are vague and give you one sentence explanations of what you should include, this book is near complete.
In Demand Business Plans
In Demand Business Plans was established to provide in-depth, quality, yet easy to understand business plans, to aspiring entrepreneurs and business owners. Founded by a team of business professionals and serial entrepreneurs, the In Demand Business Plans staff has a combined 100 years of experience, starting, growing, and selling businesses.Through the years, our team has worked with and consulted for hundreds of companies; including mom and pop, Fortune 500, and everything in between. One common factor among the successful businesses was the implementation of a sound business plan. Conversely, the common factor for all of those who were struggling or even failing, was the use of a poorly designed plan or, in many cases, no plan at all.With today’s technology, an abundance of information is available to us all at any given second. But the ability to dissect and organize that information and then present it in a thorough, yet easy to understand format, is a skill set that is far less common. Any business, especially one starting out, needs to dissect their industry. They need to put the details regarding staffing, products, facility, and multiple other categories down on paper. Ultimately, they need to establish a simple, yet concise plan to use as a roadmap to success; a business plan.In Demand Business Plans can do this for you. Our plans are not from an outdated text book. Our plans were carefully put together by our experienced team to cover every essential facet of your business. Furthermore, each plan includes all the essential categories and spreadsheets needed to secure financing through a lending institution or the SBA.Although it has been attributed to many, including Benjamin Franklin, Winston Churchill’s version is perhaps the most relevant here. "He who fails to plan is planning to fail.” Don’t plan to fail. Let In Demand Business Plans help you plan for success.
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A complete kitchen & cookware store business plan - in demand business plans, a complete kitchen & cookware store business plan:, a key part of how to start a kitchen supply store, by in demand business plans.
Smashwords Edition
Copyright 2017 Monkey Moo Publishing
All rights reserved.
This book and the contents of this book are property of Monkey Moo Publishing. All rights are reserved.
Any reproduction of this book or the contents of this book, in whole or in part, for purposes other than inclusion in a personal business plan, are prohibited by law, without the written consent of the publisher. It may not be replicated by any means, including, but not limited to, electronic or mechanical, including, but not limited to, transcribe or rewrite, recording, photocopying, or any other duplication method, for the purpose of financial gain, other than indirectly through the production of a successful business plan.
The plan outlined in this book is a compilation of research and experiences of the In Demand Business Plans management team. Although many of the suggestions described have been proven to be enormously successful, they alone cannot guarantee success. Therefore, the author assumes no responsibility for the success or failure of one or any of these steps contained in this book.
All company names, product names, websites, trademarks, and web content are acknowledged to be the property of their respective owners. Their place in this book if for reference only and are not bound to the rules and examples provided in this book. Nor is the author contractually obligated or compensated in any way for their use.
Furthermore, any tax liability or legal requirements and responsibility of the business owner are on the business owner alone. Monkey Moo Publishing, In Demand Business Plans, and its management teams are not responsible for the business owners’ actions, and are only providing the framework for the business structure.
Introduction
Congratulations on purchasing this book. That may sound odd, but it is a very big step forward to building your business plan and starting your own business. Starting, owning, and operating your own business is not only the American dream, but also the pathway to wealth.
A business plan is critical to establishing the right strategy and to taking the steps needed to ensure your success. Some analysts say a business plan increases the odds of success by four times. Your investment in this business plan is a smart one. As you will see, it will only contribute to your success.
This book, unlike so many others written about business plans, has actually done most of the work for you. While most books are vague and just point you in the right direction, sometimes those directions can get you more lost than you already were. This book is not a basic template. This book takes a completed Kitchen & Cookware Store Business Plan and provides it to you with all the additional information you will need to complete your own. Rather than a one sentence explanation for each section that directs you to write down all the details about staffing, the needed facility, and long term plans, we have done
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- 1. Running Head: Kitchen Creations Business Plan i Kitchen Creation’s Business Plan By Michelle Walker & Christina Miller Walsh University S.P.S. BJ Seif October 19th , 2011
- 2. Kitchen Creations 2 Table of Contents Page 1.0 Executive Summary 4 1.1 Introduction 4 1.2 Objective 4 1.3 Mission Statement 5 2.0 Company Summary 6 2.1 Company History 6 2.2 Locations & Facilities 6 2.3 Management Team 7 3.0 Products and/or Services 8 3.1 Current Products 8 3.2 Future Products 8 3.3 Sourcing& Fulfillment 9 4.0 Management Team 10 4.1 Organization 10 5.0 Marketing Strategy 11 5.1 Markets & Analysis 11 5.2 GDP & PPP Evaluation 15 5.3 Competitor’s Analysis 16 5.4 SWOT 16 6.0 Implementation Strategy 18 6.1 PhaseI Expansion Regions 19 6.2 PhaseII Expansion Regions 19 6.3 PhaseIII Expansion Regions 21 7.0 Execution Strategy 22 7.1 Prior Implementation 22 7.2 Manufacturing& Transportation 22 7.3 PhaseI Execution 23 7.4 PhaseII Execution 23 7.5 PhaseIII Execution 23 7.6 Assumptions 24 8.0 Product Change Strategy 25 8.1 Modifications 25 8.2 Packaging& Instructions 26 9.0 Ordering 27 9.1 Web Considerations & Changes 27 9.1.1 Language Considerations 27 9.1.2 OnlinePayments 27 9.2 Phone & OnlineOrders 28 10.0 Management Team 29 10.1 Changes to Current Organization 29 10.2 Additional Personnel 29
- 3. Kitchen Creations 3 Table of Contents Page 10.3 Cultural Training 30 10.4 SellingStrategy Considerations 31 10.4.1 Sales 32 10.4.2 International Distributors 32 10.4.2.1 Distributor Fees 32 10.5 Future Considerations 33 10.6 StaffingNeeds 33 11.0 Unit Forecast 34 11.1 PhaseI Units 34 11.2 PhaseII Units 34 11.3 PhaseIII Units 35 11.4 Forecastof Year Units 36 12.0 Implementation Costs 39 12.1 PhaseI ShippingCosts 39 12.2 PhaseII ShippingCosts 42 12.3 PhaseIII Shipping Costs 42 12.4 Cost Breakdown 43 13.0 Financial Analysis 45 13.1 Sales Revenue 45 13.1.1 PhaseI Revenue 45 13.1.2 PhaseII Revenue 46 13.1.3 PhaseIII Revenue 46 13.2 PhaseAnalysis 49 13.3 Cash FlowProjection 50 13.4 Year Analysis & Break Even 51 13.5 ROI 53 14.0 Risks Analysis 55 14.1 Competition 55 14.2 Market Acceptance 55 14.3 Investment 55 15.0 Support Analysis 56 15.1 Inventory on Hand & HandlingTerms 56 15.2 Turnaround Time 56 15.3 Support Location 56 15.4 Personnel Needed 57 15.5 Warranty 57 16.0 Exit Strategy 58 16.1 Exit Conditions 58 16.2 ProactivePlanning 58 Appendix A-Regional Cost Chart 59 Appendix B- PricingComparison Chart 60
- 4. Kitchen Creations 4 1.1 Introduction Kitchen Creations has proven itself as a successful and dynamic company. For more than 30 years, we have been providing consumers across the United States with quality kitchen products at great prices. We have managed to thrive even in these tough economic times, making over $100 million last year. With a highly experienced management team, Kitchen Creations has risen above the competition. Today we are looking to share our wonderful products with the rest of the world. In the following pages, you will find a plan for that expansion, a 12-month project. EXECUTIVE SUMMARY 1.2 Objective Kitchen Creations strives to provide high quality products at affordable prices for restaurant owners, cooking enthusiasts, and specialty shops. Opened in 1980 by CEO Michelle Walker and President Christina Miller, Kitchen Creations is expanding from a strictly domestic business to a global business. Through innovation, creative marketing, and top quality products, Kitchen Creations plans to expand into Western Europe, Canada, Mexico, and Asia within the next twelve months. We will provide consumers and business owners all over the world with our “It's For Life” Blend-All Blender and Max Mixer. An opportunity for success exists in developing markets for exceptional quality commercial appliances that carry a limited lifetime guarantee. Kitchen Creations lifetime guarantee creates competitive advantage over our major competitors, who offer one-year manufacturer warranties and extended protection plans. Our success in International expansion will rely on this advantage as well as utilizing our highly experienced staff, and effective marketing approach.
- 5. Kitchen Creations 5 1.3 Mission Statement Kitchen Creations maintains a tradition of conducting its operations in accordance with both the law and the highest standards of business ethics and integrity. We value the reputation of our good name within the communities that we serve. We are committed to providing top of the line products in a global environment. Kitchen Creations offers a continual focus on the personal development and growth of our employees. We offer a wealth of opportunities with significant advancement potential to anyone who enjoys working with and serving others, embraces diversity and innovation, and has a strong commitment to being the best. We care about our communities and take social responsibility and environmental protection seriously. We work with several charitable organizations, providing funding and assistance through corporate support and employee engagement programs.
- 6. Kitchen Creations 6 COMPANY SUMMARY 2.1 Company History Kitchen Creations, founded by Michelle Walker (currently CEO) and Christina Miller (currently President), began as a partnership in 1980 selling their “It’s for Life” line of high quality commercial appliances, and soon grew to a privately held C corporation. The company’s shares are held by Michelle Walker, Christina Miller, two family members, and three private investors. Kitchen Creations has become a well-known name among restaurant owners, culinary institutions, cooking aficionados, such as Rachel Ray and Emeril, and specialty shops such as Starbucks and Pulp. Our blenders have become an industry staple across the United States. Previous year’s sales topped $100 million, and with global growth, the opportunities are endless. Through constant process improvement and many phases of product improvement as well as warranty extension, Kitchen Creations has ensured that our products exceed current standards and are dedicated to continuous improvement. We are ISO 9001 registered, ensuring our customers the benefit of consistent service and products. 2.2 Locations & Facilities Kitchen Creations corporate office and parent plant is located in Akron, Ohio. We also have manufacturing and fulfillment facilities located in Michigan, Louisiana, Arizona, Oregon, Colorado, and New York. We also maintain a strong web presence, with 80% of orders coming through our website, www.kitchencreations.com.
- 7. Kitchen Creations 7 2.3 Management Team **Bio of Management Team Attached in Management Organization Section**
- 8. Kitchen Creations 8 PRODUCTS & SERVICES 3.1 Current Products Kitchen Creations currently sells a variety of commercial and noncommercial kitchen appliances, from can-openers, to pasta makers in our “It’s for Life” line of products. Previous year’s sales for this line was in excess of $100 million. 3.2 Future Products Kitchen Creations will offer commercial quality blenders for use by professional chefs, restaurants, specialty shops and culinary institutions. Two options are offered, a lower-end model, called the Max Mixer and a high-end model, called the “It’s For Life” Blender. Each product uses a universal plug, with adaptors available where applicable. We provide manufacturing, customer service, and order fulfillment. “It’s For Life” Blend-All Blender – (Illustration 3.1) Commercial Quality 2 peak horsepower motor that propels blades up to 240 MPH 1380 watt motor Chop, cream, blend, cook, grind, knead, churn, and more with one machine Cleans itself with a drop of dish soap and warm water, just run for 30 seconds Preprogrammed settings allow for restaurant quality creations 64 oz. container & 8 quart mixing bowl Lifetime warranty
- 9. Kitchen Creations 9 Illustration 3.1 Max Mixer-(Illustration 3.2) Chop, cream, blend, cook, grind, knead, churn, and more with one machine 5 year limited warranty Stainless steel blades that go up to 150 MPH 800 watt motor 32 oz. Container Dishwasher Safe Illustration 3.2 3.3 Sourcing & Fulfillment We will take orders at our Akron, OH office, which will be automatically sent to our distribution company, Worldwide Distributions. Product will primarily be shipped from our Ohio and New York manufacturing facilities to the port in Newark, NY.
- 10. Kitchen Creations 10 MANAGEMENT TEAM 4.1 Management Organization & Qualifications Aaron McCauley, Sales Manager Aaron has 20+ years experience as a sales manager. He has consistently achieved a strong record of outperforming sales quotas, developing new business, and strengthening customer relations. He also brings advanced knowledge in ecommerce solutions. In the five years Aaron has been with Kitchen Creations, he has generated on average 200 new accounts annually, becoming a major driver in our business growth. Previously, Aaron was a Sales Manager for Dell Corporations where he was awarded sales manager of the year for three consecutive years. Dell Corporations has been one of the leading industries for desktop computers and laptops. Aaron’s responsibilities as Kitchen Creations Sales manager is to capitalize on new revenue potential, assign sales territories, set goals, establish training programs for their sales representatives, and advise on ways to improve sales performance and achieve goals in order to obtain expected quotas. Keith Miller, Production Manager Keith Miller holds a Master’s Degree in Management obtained from Akron University. He has ten years experience in operations and previously worked for Little Tikes in Hudson Ohio where he oversaw production of their high-quality, innovative children’s products. Keith Miller’s responsibilities for Kitchen Creations include overseeing the production process, drawing up production schedules, and cost effectiveness analysis. He is responsible for on-
- 11. Kitchen Creations 11 time production, as well quality control in order to meet the standards set by the ISO 9001. He is responsible for maintenance of equipment, liaising among different departments (the suppliers, department heads, etc.), ensuring health and safety guidelines are followed along with company policies and goals, reviewing performances, and identifying training needs. John Howard, Marketing Manager John Howard is a highly qualified Marketing Manager with 10 years of distinguished service in the manufacturing industry. Previously John was employed by Curtis, a software development company, based in Akron, Ohio, that created and developed software applications, like OEM imaging. John Howard’s strategic planning skills and excellent presentation skills helped make Curtis products a leader in their respective industry segments. John Howard’s responsibilities for Kitchen Creations are to develop marking plans, coordinate with web teams to develop web sites and e-commerce logistics, develop financial models including forecasting, marginalanalysis, and pricing policy, collaborate with research professionals to conduct primary research, successfully execute business plans, and communicate on various levels. Rita Nelson, Customer Service Manager Rita Nelson recently left HH Gregg as a department supervisor and joined our team as the Service Manager. She has brought with her a high-energetic and results-oriented professional personality. She has a lifetime of sales and customer service experience from working in retail for over 30 years.
- 12. Kitchen Creations 12 Rita will be the key contact and company representative for the company partnership with Worldwide Distribution. She will oversee the transition from company fulfillment centers to distribution through Worldwide Distribution. She will work with Worldwide Distribution to establish high call center standards and implement automated call center customer survey and tracking systems in order to measure customer service performance. She will monitor all customer relations, whether through Worldwide Distribution or through Kitchen Creation’s website. Claven Tesla, Research & Development Claven Tesla, great, great, great, grandson of Nikola Tesla, inventor and mechanical engineer credited for his contribution in commercial electricity, holds degrees in the fields of computer, electrical, mechanical and civil engineering and has worked for Kitchen Creations for 7 years. Claven’s responsibilities for Kitchen Creations are to oversee all scientific aspects on research projects. He will be responsible for recruitment of qualified scientists, the allocation funds for company projects, and developing research projects to measure Kitchen Creation’s success. Additionally, he will provide advice and suggestions to senior managers on R & D options available in the organization, build and manage experimentalprograms for testing equipment, and assuring excellence of products. He will also manage the inspection and/or modification of electrical components, mechanical and quality assurance for all markets, and be responsible for giving demonstrations and presentations of new products.
- 13. Kitchen Creations 13 Benoit Dervishi, Foreign Relations Benoit is a recent hire with 15 years of broad-based international experience from companies such as Coca-Cola bottling Company, IBM, Hoover, and Ford Motor Company. He is highly articulate and an effective communicator, who is fluent in several languages, and works well with individuals on all levels. He possesses expertise in developing business plans for expansion, interpersonal skills and cross-functional team interactions, as well as in utilizing intelligence and facilities, allowing several companies to successfully expand internationally under his direction. Benoit’s responsibilities with Kitchen Creations will be to oversee the company’s foreign business by having the knowledge and awareness of various cultures, political and operational challenges of foreign markets, finance and foreign currency, as well as available opportunities in foreign markets. He will also serve as the primary contact for global distributors, take responsibility for project deadlines, and in accord with company and U.S. policy, regarding exporting products to foreign destinations, establish and monitor procedures and service standards for export clearance standards and conduct training and seminars for staff and clients in shipping and export administration.
- 14. Kitchen Creations 14 MARKETING STRATEGY 5.1 Marketing Analysis Kitchen Creation’s target market for the lower-end blenders is adults with families, ages 30-50, are middle to upper class and love to cook and bake. Primarily women, the target market is looking for reasonable priced kitchen appliances that will help them whether making dinner or a birthday cake for their child. They spend a lot of their free time cooking, and are very enthusiastic about the products they use. We intend to reach this market through targeted marketing in cooking magazines, such as Taste of Home, as well as Parents Magazine and Real Simple Magazine. Commercials will air in primetime slots for shows such as Desperate Housewives, Dancing with the Stars, and other top-rated female favorites as well as daytime commercials during soap operas, Ellen, The View, etc. We have an agreement with Rachel Ray, who uses our product on her show, and will air commercials with special pricing for viewers during that time-frame. We will also market the product on home-shopping channels such as QVC and the Home Shopping Network. Finally, we will also provide advertising in online format through news sites, social networking sites, and entertainment sites. Kitchen Creation’s target market for the upper-end blenders is middle to upper class owners of restaurants, coffee shops, bakeries, smoothie shops and other specialty shops that frequently use blenders. The target market will already be established in their respective industries with disposable income to spend on product improvements. Quality is of the utmost importance to these businesses, which is why Kitchen Creation’s lifetime guarantee is so important.
- 15. Kitchen Creations 15 We intend to reach this market through trade journal advertising for industries such as coffee and snack shops, chain restaurants, and individual single site restaurants. We will participate in trade shows and conferences related to the food industry, with special discounts if our products are purchased during the show. We will list our products in food service catalogs as well as online advertising for food service retailer sites. The coffee and snack shop industry as well as chain restaurant industry comprised an estimated $9.57 trillion in consumer spending in 2011, with an expected $10.9 trillion in consumer spending by 2016. These figures show that Kitchen Creations has an opportunity to capitalize on the success of these industries by providing innovative, high quality, reasonably priced products that will help to streamline their operations. 5.2 GDP & PPP Evaluation In evaluating markets for expansion, we looked at several factors. We chose regions with high or rapidly growing GDP (purchasing power parity). We also looked at each country/region’s real growth rate from 2010, to ensure that there was positive growth. We evaluated each area’s consumer pricing and local purchasing power in comparison to the United States. Finally, we researched the current economic conditions of each region and selected those that were already established free markets, or those in the process of becoming a free market. We ruled out Italy, Russia, and Guatamala. *Please see attached chart for comparison of regions* Expansion Plan Phase 1 France Germany United Kingdom Phase 2 Costa Rica Mexico Canada Phase 3 India China Hong Kong
- 16. Kitchen Creations 16 5.3 Competitor’s Analysis Primary competitors for the lower-end model include Vitamix, Oster, Blendtech, and Hamilton Beach. However, each of these companies sells much cheaper, and lower quality, products. Their products are available at stores like Target, Macy’s. Walmart, and Bed Bath & Beyond. Though technically competition, they aim for a different target market than Kitchen Creations, and do not pose much of a threat. Their target market is lower income, with casual and occasional users. Competitors for the professional chef include the Power Pro Blender, Kitchen Aid, and Vitamix Professional Series. Neither, however are currently selling anywhere other than the U.S. The longest warranty is for 7 years and provided by Vitamix. Primary Competition It’s For Life Competition Max Mixer Competition Power Pro Blender Braun Power Blend Kitchen Aid Vitamix Vitamix Professional Oster Kenwood Blendtech Hamilton Beach 5.4 SWOT Strengths Kitchen Creations has a solid foundation and reputation in the Unites States, as well as several U.S. customers that also operate globally, such as Starbucks. We create our products with the finest parts and put finished product through multiple tests to ensure peak performance. We offer a lifetime guarantee. Only one of our competitors currently ships to Europe, all others are strictly U.S. based. We are ISO 9001 certified. We employ an excellent, and highly experienced, management team. Prior year sales in the U.S. were $100 million.
- 17. Kitchen Creations 17 Weaknesses We have no prior experience in global sales. Our manufacturing plants are spread throughout the U.S., which could pose a problem in terms of getting product to the various overseas markets in a timely fashion if in a crisis. The majority of our management team is primarily used to dealing in the United States. We have little knowledge of international laws, political systems, and trade barriers. We currently do not have a brick and mortar retail support system, but rely entirely on phone and internet sales. Opportunities We have a great opportunity to reach entirely new markets with our products. Many of the regions we are expanding into are favorite tourist locations, meaning an added number of specialty shops and restaurants as potential customers. We have the opportunity to build relationships with retail partners and manufacturers’ in the global areas we will be operating, allowing us to further expand our product and potentially, to lower costs. We have an opportunity to gain a great deal of market share, considering our competition does not ship internationally. Threats There is a threat that Kitchen Creations could fail in one, several, or all of the market expansions. There may be existing stores selling blenders in the various markets that we are unaware of, which would pose additional competition. We may face skepticism or even hostility upon entering a new market. There may be political factors, or challenges, that we will be forced to deal with in any one of the markets. Additionally, we could miscalculate the projected sales and end up sitting on a lot of inventory that we cannot sell, tying up capital.
- 18. Kitchen Creations 18 IMPLEMENTATION & STRATEGY In every area we analyzed, GDP indicated a healthy economy, and each area showed a positive real growth rate in 2010. Though none was as high as the United States, each region appears to be a good choice for expansion, with the exception of Italy, Guatemala, and Russia. Each of the regions, while varying in terms of economic practices, either has already established a free-market economy, or is transitioning in that direction, (with the exception of Italy).This indicates a trend toward globalization and a positive market environment in which to market our products. 0 50 100 150 200 250 300 350 Fra nce Ge rm any Uni ted Kin gd om Ital y Cos ta Ric o Me xic o Ca na da Ind ia Rus sia Chi na Ho ng Ko ng Uni ted Sta tes GDP 74.52.942.171.7751.21.571.334.062.2210.1 326 14.7 Real Growth Rate 1.5 3.5 1.3 1.3 4.2 5.2 3.1 10.4 4 10.3 6.8 2.8 GDP Real Growth Rate
- 19. Kitchen Creations 19 6.1 Phase I Expansion Regions Our first expansion will be into Western Europe. We compared France, Germany, United Kingdom, and Italy. Consumer prices in Europe are higher than those in the U.S.; however, local purchasing power is lower. This indicates that consumers are able to buy less with their disposable income, which was comparable to the average monthly disposable income in the Unites States. 6.2 Phase II Expansion Regions Our second phase of expansion will be into Mexico and Canada. We analyzed Costa Rica, Mexico, Guatemala, and Canada. Guatemala was determined not to be a productive market for expansion. With the lowest GDP of all regions compared, and a lack of information on consumer pricing and local purchasing power it seemed a risky move. Mexico, overall, is characterized by lower consumer prices, local purchasing power, and disposable income. 0 5 10 15 20 25 30 35 40 45 France Germany United Kingdom Italy 22.97 1.06 21.36 40.72 Local Purchasing Power Local Purchasing Power
- 20. Kitchen Creations 20 However, since signing the NAFTA trade agreement, expanded seaports, railroads, telecommunication, and airports makes it an accessible market for expansion. Furthermore, the fact that Mexico is a free market economy that enacted the North American Free Trade Agreement (NAFTA) in 1994 means expansion should be less problematic than in other areas. Canada’s economy is very similar to that of the U.S. and Canada also enacted NAFTA in 1994, as well as the U.S. Canada Free Trade Agreement in 1989, which implies that expansion is a good option for Canada. 0 500 1000 1500 2000 2500 3000 3500 Cost a Rico Mexi co Guat amal a Cana da GDP 51.17 1.567 70.15 1.33 Local Purchasing Power 56.93 52.31 0 6.69 Median Monthly Disposable Salary 975 845.51 510 3018.76 GDP Local Purchasing Power Median Monthly Disposable Salary
- 21. Kitchen Creations 21 6.3 Phase III Expansion Regions Finally, our third phase of expansion is Asia. We analyzed India, Russia, China, and Hong Kong, finding all but Russia to be a viable expansion point. Of all the regions, Asia shows the highest levels of real growth rate in 2010. India is currently developing into an open-market economy. China, though slowly, is transitioning into a more market- oriented system and Hong Kong is already operating under a free market economy. While still developing, Asia is a good opportunity for business growth. 0 2 4 6 8 10 12 India Russia China Italy 2.8 4 10.3 6.8 Real Growth Rate Real Growth Rate
- 22. Kitchen Creations 22 EXECUTION STRATEGY 7.1 Prior to Implementation Three to six months prior to execution, several individuals need to be hired and trained. Personnel Needs Personnel Quantity Needed Information Technology Professionals (Experienced in International Business) 2 Call Center Representatives (bilingual) 10 International Consultant 1 Loading Warehouse Personnel 2 The IT professionals will work with our current IT team to create a duplicate website in French, German, Spanish, and Chinese. Customers will have the option of choosing which website they want through a highly visible drop down box in the top and center of our current webpage. The call-center representatives will be trained by our service manager, Rita Nelson, in order to be able to troubleshoot, take and process orders, handle returns, etc. prior to expansion. The International Consultant will help Kitchen Creations to ensure a smooth transition into the various markets. He will consult on packaging and instructions, website creations, as well as be a hands-on participant in the actual phases of implementation. 7.2 Manufacturing/Transportation Of the five manufacturing plants, Ohio and New York will produce product strictly for our international orders. Road Runner Transportation will truck the product from Ohio to New York. All product will ship out of the port in Newark, New York. Production needs to be at full capacity. 50,000 units of each product need to be ready to ship by the execution date. Though we only ship 12,000 units in phase 1 we want to ensure that we have a cushion throughout the implementation process in case we need to quickly move product.
- 23. Kitchen Creations 23 7.3 Phase I Timeframe o Phase 1: France, Germany, and the United Kingdom. o Timeframe: 6 months Sales Manager, Foreign Relations Manager, and Consultant are on-site throughout implementation. Product ships from port in Newark, New York to Worldwide Distribution’s Belgium distribution center. Website and call-center reps route orders to DC for fulfillment. 7.4 Phase II Timeframe o Phase 2: Mexico, Costa Rica & Canada o Timeframe: 3 months Sales Manager, Foreign Relations Manager, and Consultant stationed in Mexico. Local executives will be in charge of Canada implementation. Orders will be fulfilled through World Distribution’s New York distribution center. 75,000 units will be shipped during phase 2. 7.5 Phase III Timeframe o Phase 3: India, China, and Hong Kong o Timeframe: 3 months Sales Manager, Foreign Relations Manager, and Consultant are on-site throughout implementation. Product ships from New York Mfg. facility to Belgium Distribution Center. Website and call-center reps route orders to DC for fulfillment. 135,000 units will be shipped during phase 3.
- 24. Kitchen Creations 24 7.6 Assumptions 1 out of 500 units will may be defective 200 units will be on hand for every 100,000 for replacement The New York Manufacturing Plant will focus on providing product for Europe. Estimated time between deliveries: 1 month, initially Future plans include building a manufacturing plant near Belgium and hiring an executive staff. 0% 20% 40% 60% 80% 100% Implementation Implementation Plan By Month January-June July-September October-December France, Germany, United Kingdom Mexico Costa Rica, Canada India China Hong Kong
- 25. Kitchen Creations 25 PRODUCT CHANGE STRATEGIES 8.1 Product Modifications The logo on each design will need to be modified/translated for the appropriate market. After researching the various plugs used in each region, we determined that it would be easier to include a universal adaptor, rather than modify the products for each region. Country/Region Design Modifications Certification Considerations New Labels and Marketing MISC. France Logo in French Fitted with Europlug 230 Volt Instructions & Packaging in English & French Germany Logo in German Europlug Instructions & Packaging in English & German EuroPlug (France, Germany & United Kingdom) United Kingdom No Change Necessary Europlug Instructions & Packaging in English Canada None 240 Volt Modifications Instructions & Packaging in English Mexico/Costa Rica Logo in Spanish Same as U.S., Canada Instructions & Packaging in English & Spansih Japan Logo in Japanese 100 Volt-Step Down Converter Needed Instructions & Packaging in English & Japanese
- 26. Kitchen Creations 26 China Logo in Chinese 220 Volt Flat blade or V- blade plug Instructions & Packaging in English & Chinese Flat blade plug V-shaped flat prongs Hong Kong Logo in Mandarin 220 Volt, Rounded Triangle Plugs Instructions in English, & Mandarin. Three round pins arranged in a triangle Three round pins arranged in a triangle Two parallel flat pins with ground pin 8.2 Packaging & Instructions Instructions will be printed in English and the primary language for each region. Packaging will reflect a region’s culture, in a manner that will be appropriate and eye-catching for sales/marketing purposes.
- 27. Kitchen Creations 27 ORDERING 9.1 Web Considerations The IT professionals will work with our current IT team to internationalize our website in order to improve communications with our wide international audience, which includes the United States, Canada, Mexico, France, Germany, Costa Rica, India, United Kingdom, China, and Hong Kong. 9.1.1 Language Considerations Customers will have the option of choosing which language they want through a highly visible menu to the left of the page, as well as easy national flag navigation buttons across the top of the page (See Figure 3.1). 9.1.2 Online Payments We will use Paypal, Visa, Mastercard, and American Express. Customers also have the options of entering their routing number and account number to authorize an automatic transfer from their bank account. Our customer service page will include email addresses as well as phone numbers for customers to contact us with any web issues, problems related to ordering, or general questions and feedback. This will be beneficial in building loyalty and also a good tool to gain valuable feedback to use for future improvements. 9.1.3 Future Enhancements Further enhancements include a Frequently Asked Questions page, an instant messaging option during normal business hours, and a delivery calculator that tells the
- 28. Kitchen Creations 28 customer when they can expect to receive their product. There will also be a link allowing customers to post feedback on our website. 9.2 Phone & Online Orders The call-center representatives will be trained by our service manager, Rita Nelson, in order to be able to troubleshoot as well as take and process online & phone orders. They will also handle the returns, customer service complaints, confirmation emails, email alerts, new product information, and registration information. The International Consultant, working with our Director of Foreign Relations, will help Kitchen Creations to ensure a smooth transition into the various markets. He will assist in developing a training program for the company, as well as in implementation. He will consult on packaging and instructions, website creations, as well as be a hands-on participant in the actual phases of implementation.
- 29. Kitchen Creations 29 MANGEMENT TEAM 10.1 Change to Current Organization New Hires Cost/Salary Responsibility Current Mgr. Responsible for Training 4 Loading Personnel $37,500 Each Annually (2 at NY, 2 at AZ) Load product from NY & AZ Fulfillment centers to be sent to international markets. Keith Miller- Production Manager 10 Bilingual Customer Service Representatives $30,000 Each Annually 3 Each to Manage each phase of Implementation Rita Nelson- Customer Service Manager 2 IT Professionals $45,000 Each Annually Work with existing team to format website for all regions/languages John Howard- Marketing Manager International Consultant $150,000 (18 mos.) Assist with coordination of each implementation, Educate current staff on different cultures/Ensure proper licensing, packaging, and certifications are followed in each region N/A 10.2 Additional Personnel Bilingual Customer Service Representatives Kitchen Creations will hire 2 bilingual representatives for each of the languages we will be dealing with (Spanish, French, German, Chinese, and Japanese), in addition to English. Rita Nelson and the current customer service team will train them in the company procedures. Hire date will be 3 months prior to Phase 1.
- 30. Kitchen Creations 30 Information Technology Professionals Kitchen Creations will hire two additional IT professionals whose primary responsibility will be to convert the current website to the new website tailored for each region. The team will work with Benoit Dervishi, our Director of Foreign Relations to ensure that adaptations are made for each region to ensure that the proper grammar, culture, and graphics are utilized. Hire date will be 6 months prior to Phase 1. International Consultant Kitchen Creations will hire an International Consultant to work will the entire management team to prepare for all phases of implementation, including but not limited to cultural differences, packaging, licensing, and certification requirements, shipping regulations, and import/export regulations. The consultant will also accompany our Sales Manager to the site of each implementation phase to assist in coordination of the process and ensure a smooth transition into the international markets we have targeted. Hire date will be 6 months prior to Phase 1. 10.3 Culture Training Considerations Cultural Training: Kitchen Creation’s Director of Foreign Relations, along with the International consultant will create and implement a training program for all current Kitchen Creations employees educating them on the various cultural differences relevant for each region.
- 31. Kitchen Creations 31 Foreign Language Courses: Kitchen Creations will cover the cost of foreign language classes at Akron University for interested employees. All top management is required to enroll. Cost per class is $1,155.57 *Assuming 15 Enrollments $- $100,000.00 $200,000.00 $300,000.00 $400,000.00 $500,000.00 $600,000.00 $700,000.00 $800,000.00 $900,000.00 Staffing & Training Costs Staffing & Training Costs
- 32. Kitchen Creations 32 10.4 Selling Strategy Considerations 10.4.1 Sales Method of Sales: Online, Phone Percentage of Sales per avenue: 80% Online 20% Phone Cost of Website Upgrade: $10,000 Website Maintenance: $150/Month Telecommunications: $2000/Month 10.4.2 International Distributors Method of Fulfillment: New York & Ohio Kitchen creations Fulfillment Centers Distribution Centers: Phase 1: Worldwide Distribution, located in Brussels, Belgium - European Distribution Phase 2: Worldwide Distribution, located in Albany, NY – Mexico, Costa Rico, & Canadian Distribution Phase 3: Worldwide Distribution, located in Beihal, China – Asian Distribution, & Brussels, Belgium –European Distribution 10.4.2.1. Monthly Distribution Center Fees: Fixed “Rental” Cost: $1,500 each Cost Per Case: $ .10
- 33. Kitchen Creations 33 10.5 Future Considerations Once established in all markets, hire a regional sales manager for each. Further staffing needs as required Potential for International Fulfillment Centers in future 10.6 Staffing Needs Met through Akron, Ohio Corporate Office and Fulfillment Center $4,500 $4,500 $4,500 $3,000 $6,000 $9,000 $7,500 $10,500 $13,500 $31,500 $- $5,000 $10,000 $15,000 $20,000 $25,000 $30,000 $35,000 Phase 1 Phase 2 Phase 3 Total Distribuion Costs Distribution Costs through Implementation Fixed Cost Cost Per Case Total DC Costs
- 34. Kitchen Creations 34 UNIT & COST FORECAST 11.1 Phase I Units Units Shipped Per Regions in Phase I France 4,000 Germany 4,000 United Kingdom 4,000 Total Units 12,000 11.2 Phase II Unit Forecast We will increase the units to 6,000 units each for regions of phase I (50-50 mix of low and high end) and begin to ship to regions Mexico, Costa Rico, and Canada, 4,000 units each. Total units shipped will be 30,000 units for phase II. 0 2,000 4,000 6,000 8,000 10,000 12,000 France Germany United Kingdom Total Units
- 35. Kitchen Creations 35 Units Shipped Per Regions in Phase II France 6,000 Germany 6,000 United Kingdom 6,000 Mexico 4,000 Costa Rico 4,000 Canada 4,000 Total Units 30,000 11.3 Phase III Unit Forecast We will continue to ship to regions I & II but will also continue to increase units shipped to our other regions as market acceptance increases. We will also begin to ship 4,000 units each to regions India, China and Hong Kong, for a total of 60,000 total units shipped in Phase III. 0 5,000 10,000 15,000 20,000 25,000 30,000 Units Shipped Per Regions in Phase II Units Shipped Per Regions in Phase II
- 36. Kitchen Creations 36 Units Shipped per Region in Phase III France 10,000 Germany 10,000 United Kingdom 10,000 Mexico 6,000 Costa Rico 6,000 Canada 6,000 India 4,000 China 4,000 Hong Kong 4,000 Total Units 60,000 11.4 Forecast of Total Units for First Year France, Germany, and the United Kingdom will see 20,000 units each shipped during the first year. 0 10,000 20,000 30,000 40,000 50,000 60,000 France Germany UnitedKingdom Mexico CostaRico Canada India China HongKong TotalUnits Units Shipped per Region in Phase III Units Shipped per Region in Phase III
- 37. Kitchen Creations 37 Mexico, Costa Rico, and Canada, will see 10,000 units each shipped during the first year. India, China, and Hong Kong, will see 4,000 units each shipped the first year. Total number of units to be shipped is 102,000 with 12,000 units shipped in phase I, 30,000 units shipped in phase II, and then 60,000 units shipped in phase III. Yr 1 - Units Shipped Per Region France 20,000 Germany 20,000 United Kingdom 20,000 Mexico 10,000 Costa Rico 10,000 Canada 10,000 India 4,000 China 4,000 Hong Kong 4,000 Total Units 102,000 0 20,000 40,000 60,000 80,000 100,000 120,000 Yr 1 - Units Shipped Per Region Yr 1 - Units Shipped Per Region
- 38. Kitchen Creations 38 Units Shipped Trend 0 20,000 40,000 60,000 80,000 100,000 120,000 Yr 1 - Units Shipped Per Region Yr 1 - Units Shipped Per Region 0 20,000 40,000 60,000 80,000 100,000 120,000 Phase I Phase II Phase III Total
- 39. Kitchen Creations 39 IMPLEMENTATION COSTS 12.1 Phase I Shipping Costs After considering two reputable freight service providers, we decided to use Road Runner Transportation Services (found at www.freightrater.com) to move our merchandise from our warehouse in Akron, Ohio to the port or distributor in New York. They outbid typical semi- truck transportation by ¾ of the cost because they use different carriers such as freight rail. (See Table 12.1) Phase I costs will include costs of $20,907.98 freight cost to ship to the port Newark in NY, a cost of $109,943.90 for shipping charges from the port Newark to the Port of Brussels in Belgium (Found using shipping calculator.com see figure 12.2), and approximately $10,000 forecasted for customs, duties, and misc. fees. Phase I will also incur 50% of the cost of training and staffing the expansion, or $391,167 and distribution costs of $7500, and Advertising costs of $200,000 (See Table 12.3). Phase I shipping will be CIF (destination – Brussels, Belgium) CFR (Cost and Freight) Seller paid costs necessary to bring the goods to the named port of destination. CIF (Cost, Insurance and Freight) Same as CFR but seller also has to include marine insurance loss or damage to goods during the shipment.
- 40. Kitchen Creations 40 Table 12.1 Carrier Name Est. Days Dir./Indir. Est. Price Roadrunner Transportation Services Insurance Included. 3 Direct $20,907.78 YRC 2 Direct $1,084,233.45 Shipping Details: From OH 44312 to NY 12214 Ready for pickup 11/01/11 400 Boxes of New commercialgoods Freight class: 50 Dimensions: 12 x 24 x 18 in. Total weight: 10000 lbs. Stackable: Yes Hazardous: No Quoted on: 10/03/2011 Carrier: Dugan Truck Line Estimated Transit: 3 Business days Total: $1,408.25 USD Sign Up Now
- 41. Kitchen Creations 41 Figure 12.2 DESCRIPTION VALUE RATE QTY. AMOUNT Freight 40' Container $1,532.00 20 $30,640.00 Bunker Adjustment Factor [BAF Charges] 40' Container $80.00 20 $1,600.00 Warfage 0.01 MT $2.90 $2.90 Bill Of Lading $50.00 GRI Charges $75.00 20 $1,500.00 Residential Pickup Charges $35.00 Charges for High Security Seal (What is this?) $15.00 Surcharge for Personal Effects (with or without Cars) $120.00 Drayage to Loading Area (11 - 50 Miles) $485.00 20 $9,700.00 Fuel Surcharge $2,231.00 Customs Brokerage Fee $0.00 Delivery Charges (11 - 50 Miles) $0.00 20 $0.00 Insurance Charges ($500 Deductible) (Type Of Goods: Household Goods – International Move (with or without Cars)) $3,300,000.00 2 % $66,000.00 Shipper's Declaration (Over $2,499.00) $3,300,000.00 $50.00 Less: Online Allowance $2,000.00 Total US $109,943.90
- 42. Kitchen Creations 42 12.2 Phase II Shipping Costs Phase II costs will be $41,815.86freight service charges using Road Runner Services (See table 4.12) to move 12,000 units to our distributor in Albany, NY, and 18,000 units to the port of Newark, NY. From the port of Newark, NY, the charges will be CIF (destination – Brussels, Belgium) of $109,943.90 to move 30,000 units, plus the additional costs of approximately $10,000 for customs, duties, and misc. fees. Phase II will also have costs of $195,583 for staffing & training (1/4 of a yr), distribution costs of $10,500, and $400,000 advertising expenses. 12.3 Phase III Shipping Costs Phase III will have costs of $62,723.34, to move 42,000 units using Road Runner Services to move from our facilities in Akron, Ohio to the port of Newark, NY, and 18,000 units to our distributor in Albany, NY. From the port of Newark NY, shipping charges will be $219,887.80 to move 42,000 units CIF (destination- BeihaI, China) and 18,000 units CIF (destination-Brussels), plus the additional costs of approx. $10,000 for customs, duties, and misc. fees. Phase III will also have costs of $195.583 for training & staffing (1/4 of a yr), distribution costs of $13,500, and $600,000 advertising expenses.
- 43. Kitchen Creations 43 Figure 12.3 Cost Forecast Phase I Phase II Phase III Shipping cost FCA Road Runner Service 20,907.78 41,815.56 62,723.34 FOB Seaport 109,943.90 109,943.90 219,887.80 Customs, duties, & Misc Fees 10,000.00 10,000.00 30,000.00 Hiring Personnel 391,167.00 195,583.00 195,583.00 Distribution Costs 7500.00 10,500.00 13,500.00 Advertising 200,000.00 400,000.00 600,000.00 Total Costs of Implementation 739,518.68 767,842.46 1,121,694.14 12.4 Cost Breakdown In breaking down the cost per unit, we see that in phase I costs per unit will average the most because of phase I’s time frame being that of 6 months. On average though, between the cost of product changes and the cost of shipping, the cost per unit is around $111.27 for the “It’s For Life” high-end model and $81.27 for the “Max Mixer” low-end model. It’s For Life Blender Cost Per Unit Max Mixer Cost of Product 90.00 60.00 Cost of Product Changes Packaging and Instruction 5.00 5.00 Labels & Certification 5.00 5.00 Cord/Adapter 6.50 6.50 Unit Cost 106.50 76.50
- 44. Kitchen Creations 44 Units Costs Shipping $243,351.68 $130,443.90 $363,611.14 Units $12,000 $30,000 $60,000 Average Cost of Unit w/shipping $8.11 $2.17 $4.04 Plus Cost of Product Changes $106.50/76.50 $106.50/76.50 $106.50/76.50 High End Total Unit Costs $114.61 $108.67 $110.54 Low End Total Unit Costs $84.61 $78.67 $80.54 *Shipping costs include FCA Road Runner Service, FOB Seaport, Customs/Duties/Misc. Fees, Distribution Costs, and Hiring/Training Costs for additional Loaders only.*
- 45. Kitchen Creations 45 FINANCIAL ANALYSIS 13.1 Sales Revenue Unit costs were determined using the pricing comparison table (Table 13.1 Appendix B). Our marketing team, together with the international consultant, compared pricing in each of the regions using similar blender brands and determining the mark-up used in each region. As a secondary comparison, they compared the price of the same model of new car in each region to help ensure our pricing was in-line with regional pricing. 13.1.1 Phase I Revenue The 6,000 high-end & 6,000 low-end units that will be shipped during phase I will generate $3,897,008 in revenue. Phase I High End Sales Regions Units Unit Cost COGS Sales Revenue Gross Profit UnitedKingdom 2,000 114.61 $229,220.00 $815,168.00 $585,948.00 Germany 2,000 114.61 $229,220.00 $730,432.00 $501,212.00 France 2,000 114.61 $229,220.00 $852,544.00 $623,324.00 Phase I High End Totals $687,660.00 $2,398,144.00 $1,710,484.00 Phase I Low End Sales Regions Units Unit Cost COGS Sales Revenue Gross Profit UnitedKingdom 2,000 84.61 $169,220.00 $509,488.00 $340,268.00 Germany 2,000 84.61 $169,220.00 $456,528.00 $287,308.00 France 2,000 84.61 $169,220.00 $532,848.00 $363,628.00 Phase I Low End Totals $507,660.00 $1,498,864.00 $991,204.00 Total High & Low End Totals 12,000 $1,195,320.00 $3,897,008.00 $2,701,688.00 UnitBreakdown $99.61 $324.75 $225.14
- 46. Kitchen Creations 46 13.1.2 Phase II Revenue Phase II will increase the number of units shipped to phase I regions, and begin shipping a 50- 50 mix of low end and high end units for regions of phase II bringing the total to 30,000 units generating $8,681,548.00 in sales revenue. Phase II High End Units Unit Cost COGS Sales Revenue Gross Profit United Kingdom 3,000 108.67 $326,010.00 $1,222,752.00 $896,742.00 Germany 3,000 108.67 $326,010.00 $1,095,648.00 $769,638.00 France 3,000 108.67 $326,010.00 $1,278,816.00 $952,806.00 Canada 2,000 108.67 $217,340.00 $783,104.00 $565,764.00 Mexico 2,000 108.67 $217,340.00 $607,616.00 $390,276.00 Costa Rico 2,000 108.67 $217,340.00 $599,980.00 $382,640.00 Phase II High End Totals $1,630,050.00 $5,587,916.00 $3,957,866.00 Phase II Low End Units Unit Cost COGS Sales Revenue Gross Profit United Kingdom 3,000 78.67 $236,010.00 764,232.00 $528,222.00 Germany 3,000 78.67 $236,010.00 684,792.00 $448,782.00 France 3,000 78.67 $236,010.00 799,272.00 $563,262.00 Canada 2,000 78.67 $157,340.00 359,740.00 $202,400.00 Mexico 2,000 78.67 $157,340.00 287,792.00 $130,452.00 Costa Rico 2,000 78.67 $157,340.00 197,840.00 $40,500.00 Phase II Low End Totals $1,180,050.00 $3,093,668.00 $1,913,618.00 Total High & Low End Totals 30,000 $2,810,100.00 $8,681,584.00 $5,871,484.00 Unit Breakdown $93.67 $289.39 $195.72
- 47. Kitchen Creations 47 13.1.3 Phase III Revenue Phase III will ship a total of 60,000 units, a 50-50 mix of low-end & high-end models for regions of phase III, and an increase in units shipped to regions I & II. Sales revenue generated totals $18,345,700.00. Phase III High End Units Unit Cost COGS Sales Revenue Gross Profit United Kingdom 5,000 110.54 $552,700.00 $1,957,760.00 $1,405,060.00 Germany 5,000 110.54 $552,700.00 $1,826,080.00 $1,273,380.00 France 5,000 110.54 $552,700.00 $2,131,360.00 $1,578,660.00 Canada 3,000 110.54 $331,620.00 $1,174,656.00 $843,036.00 Mexico 3,000 110.54 $331,620.00 $899,970.00 $568,350.00 Costa Rico 3,000 110.54 $331,620.00 $911,424.00 $579,804.00 China 2,000 110.54 $221,080.00 $2,664,200.00 $2,443,120.00 India 2,000 110.54 $221,080.00 $356,320.00 $135,240.00 Hong Kong 2,000 110.54 $221,080.00 $607,616.00 $386,536.00 Phase III High End Totals $3,316,200.00 $12,529,386.00 $9,213,186.00 Phase III Low End United Kingdom 5,000 80.54 $805,400.00 1,273,720.00 $182,900.00 Germany 5,000 80.54 $805,400.00 1,141,320.00 $976,200.00 France 5,000 80.54 $805,400.00 1,332,120.00 $67,900.00 Canada 3,000 80.54 $604,050.00 539,610.00 $137,850.00 Mexico 3,000 80.54 $604,050.00 431,688.00 $475,170.00 Costa Rico 3,000 80.54 $604,050.00 296,760.00 $137,850.00 China 2,000 80.54 $402,700.00 238,624.00 $301,350.00 India 2,000 80.54 $402,700.00 164,192.00 $190,350.00 Hong Kong 2,000 80.54 $402,700.00 298,280.00 $488,100.00 Phase III Low End Totals $5,436,450.00 $5,716,314.00 $2,957,670.00 Phase III Total High + Low 60,000 $8,752,650.00 $18,245,700.00 $12,170,856.00 Unit Breakdown 102,000 $145.88 $304.10 $202.85
- 48. Kitchen Creations 48 $0.00 $2,000,000.00 $4,000,000.00 $6,000,000.00 $8,000,000.00 $10,000,000.00 $12,000,000.00 $14,000,000.00 $16,000,000.00 $18,000,000.00 $20,000,000.00 High End Product Sales Revenue Low End Product Sales Revenue Total Sales Revenue Sales Revenue Projections Phase 1 Phase 2 Phase 3
- 49. Kitchen Creations 49 13.2 Phase Analysis The product costs and sales revenue per unit have been carried over from the Sales Revenue tables in order to show monthly operating breakeven point. Monthly Fixed Costs Fixed Costs Insurance 2,200.00 Rent 6,800.00 Utilities & Telecommunication 3,340.00 Telecommunication Payments 2,000.00 Machine & Equipment 5,500.00 Land & Building 4,400.00 Total Fixed Costs $24,240.00 Variable Costs Phase I Variable Costs Phase II Variable Costs Phase III Variable Costs Shipping Costs FCA Road Runner 20,907.78 41,815.56 62,723.34 CFI Seaport 109,943.90 109,943.9 219,887.80 Customs, Duties & Misc. Fees 10,000.00 10,000 30,000 Hiring Personnel 391,167.00 Distribution Costs 7,500.00 10,500 13,500 Advertising 200,000.00 400,000 600,000 Wages & Salaries 700,000.00 466,666.67 466,666.67 Product Costs (Table 5.1) 1,195,320.00 2,810,100.00 8,752,650.00 Total Variable Costs 2,634,838.68 3,849,026.13 10,145,427.81 Fixed Costs (6 Months/3 Months/3 Months) 133,440.00 72,720.00 72,720.00 Revenue per unit 324.75 299.49 $328.47 Variable Costs per Unit $219.57 $128.30 $169.09 Operating Breakeven Point (UNITS) 1268.68 424.79 456.27
- 50. Kitchen Creations 50 13.3 Cash Flow Projection Sales revenue has been carried over from the Sales Revenue tables, as well as all other expenses. Quarter 1 will not generate any revenue because our invoicing terms are 20% 30 net 60 and we will make the assumption that our distributor will take advantage of the 20% discount and pay within 30 days. Q1 Q2 Q3 Q4 CASH REVENUES Revenue from Product Sales $0.00 $3,897,008.00 $8,681,584.00 $18,245,700.00 TOTAL CASH REVENUES $3,897,008.00 $8,681,584.00 $18,245,700.00 CASH DISBURSEMENTS Salaries and Wages 350,000.00 350,000.00 350,000.00 350,000 Onetime expenses 195,583.50 195,583.50 Promotion Expense Paid 100,000.00 100,000.00 400,000 600,000 Rent/Mortgage Payments 6,800 6,800 6,800 6,800 Insurance Paid 2,200 2,200 2,200 2,200 Telecommunications Payments 1,340 1,340 1,340 1,340 Utilities Payments 2,000 2,000 2,000 2,000 Machine & Equipment 5,500 5,500 5,500 5,500 Land & Building 4,400 4,400 4,400 4,400 Operating Expenses 597,660.00 597,660.00 2,810,100.00 8,752,650.00 TOTAL CASH DISBURSEMENTS 1,265,483.50 1,265,483.50 3,582,340.00 9,724,890.00 RECONCILIATION OF CASH FLOW
- 51. Kitchen Creations 51 Q1 will end with a negative cash balance that will be carried over to Q2 Q2 generates enough revenue to cover the prior quarter’s negative cash balance and to pay for the current phase’s expenses but it does not generate enough revenue to cover Q3. Positive cash balance is carried over to the next quarter. Q3 makes enough revenue to cover current phase expenses and the excess cash is carried over to Q4. By the end of Q4 we are making enough profit, to cover the following quarter’s expenses. ($1,265,483.50) $1,366,041.00 $6,465,285.00 $14,986,095.00 1 2 3 4 CLOSING CASH BALANCE CLOSING CASH BALANCE AddBeginningCashBalance 0 -1,265,483.50 1,366,041.00 $6,465,285.00 Add: Total Cash Revenue $0.00 $3,897,008.00 $8,681,584.00 $18,245,700.00 Deduct: Total Cash Disbursements 1,265,483.50 1,265,483.50 3,582,340.00 9,724,890.00 CLOSING CASH BALANCE ($1,265,483.50) $1,366,041.00 $6,465,285.00 $14,986,095.00
- 52. Kitchen Creations 52 13.4 Year Analysis & Break Even Sales revenue has been carried over and calculated into yearly sales revenue. Variable costs have also been carried over and calculated into yearly variable costs and then broken down to variable costs per unit of $168.98 The firm’s break-even operating point is the point at which its total operating costs (the sum of its fixed & variable costs) equals sales revenue Break Even Units Unit Cost Total Total Fixed Costs $278,880.00 Total Variable Costs 2093.46 168.98 $353,752.87 Total Operating Costs $632,632.87 Average Sales Revenue per unit 2093.46 302.2 $632,643.61 Break Even Point is at approximately 2093.46 units Q1 Q2 Q3 Q4 12 months Units 0 12,000 30,000 60,000 102,000 Operating Costs 597,660.00 597,660.00 $2,810,100.00 $8,752,650.00 12,758,070.00 Sales Revenue $0.00 $3,897,008.00 $8,681,584.00 $18,245,700.00 $30,824,292.00 $302.20 Fixed Costs $66,720.00 $66,720.00 $72,720.00 $72,720.00 $278,880.00 Variable costs $1,317,419.34 $1,924,513.07 $3,849,026.13 $10,145,427.81 $17,236,386.35 $168.98 Breakeven Point 2,093.46
- 53. Kitchen Creations 53 At this point, Earnings before taxes & interest are $0 Above this point, we will make profit Below this point, we will have a loss (See Table below) 13.5 Return on Investment Return on Invest is: Gain from Investment - Cost of Investment Cost of Investment Q1 will be the only quarter in which we have a negative return. From Q2 and forward, the return continues to increase over time. Q1 Q2 Q3 Q4 Gross Profit -1,265,483.50 $1,366,041.00 $6,465,285.00 $14,986,095.00 Cost of Investment 1,265,483.50 1,265,483.50 3,582,340.00 9,724,890
- 54. Kitchen Creations 54 ROI -200.00% 7.95% 80.48% 54.10% -200.00% -150.00% -100.00% -50.00% 0.00% 50.00% 100.00% 1 2 3 4 ROI ROI
- 55. Kitchen Creations 55 RISK ANALYSIS 14.1 Competition Market Positions Currently there is very little competition in the regions that we chose. The biggest competitors are Kitchen Aid for our high-end model and Braun Power Blend for our low-end model. Kitchen Creation’s products are priced cheaper than the competition, giving us a competitive advantage. We also offer longer warranties than that of any of our competitor’s. 14.2 Market Acceptance of Our Product As with any new product introduced into a market, there is a chance that customers will reject it. Initially, we may face skepticism or even hostility. However, since similar products are already being used and we offer the competitive advantage of lower prices and longer warranties, we are confident that consumers will accept and purchase our products. 14.3 Investment The first quarter is incredibly risky, since we will be investing heavily and receiving no return on that investment. Starting in the second quarter though, we will begin to see a profit that steadily increases from quarter to quarter. There is the risk that sales will not go as planned, and we will have to go for a longer period without seeing a return on our investment. Such a situation could cause serious financial concerns for Kitchen Creations. On the other hand, we will still have our U.S. operations to sustain us through any difficult times, with over $1 million in sales annually. SUPPORT ANALYSIS
- 56. Kitchen Creations 56 15.1 Inventory on Hand & Handling Returns We will maintain a cushion of 25,000 cases of each of our products at each of our three distribution centers. In case of emergency we could also ship from one of our five manufacturing sites directly to the customer. All returns will be processed through the Customer Service Department in Akron. If the product is damaged, we will ship replacement product on the same day we receive the damaged package (if during business hours). Customer service places the order with the DC and sends the confirmation email. Customer should receive product within 2-3 days and will receive a confirmation email letting him/her know that his/her replacement product is on the way. 15.2 Turn Around Time Each order that is received at the corporate office is instantly transmitted via the ordering system to whichever DC the product will ship from (based on location). Typically, a customer will receive their product in 3-5 days, barring any disasters. Shipments between Kitchen Creations and Worldwide Distributions will occur once a month initially, and increase as needed. 15.3 Support Location Our support location is Kitchen Creations Corporate office in Akron, Ohio. Our manufacturing plants in Akron and New York will provide the product for the expansion project. We also have manufacturing plants in Michigan, Louisiana, Arizona, Oregon, and Colorado that can be utilized if necessary.
- 57. Kitchen Creations 57 15.4 Support Team 15.5 Warranty “It’s For Life” Blender: Lifetime warranty for manufacturer defects. Provides for full replacement of product. Max Mixer: 5 year limited warranty on parts and electrical. Provides for replacement of specific parts, or in the case of electrical issues, full product replacement. *Customers must register their product through our website to be eligible for warranty.* Christina Miller President Michelle Walker CEO Aaron McCauley Sales Manager 5 Assistant Sales Managers Keith Miller Production Manager Warehouse & Loading Personnel John Howard Marketing Manager 3 IT Personnel Rita Nelson Customer Service Manager 25 Customer Service Representatives Claven Tesla Research/Development Victor Adler Human Resources Benoit Dervishi Foreign Relations
- 58. Kitchen Creations 58 EXIT STRATEGY 16.1 Exit Conditions Under the following situations, Kitchen Creations will exit the region. Reason For Exit Timeframe of Exit Failure of Phase 1 1 month Political Upheaval, War, Dangerous Situation Immediately Natural Disaster (Rebuild Possible) As soon as possible Financial Crisis for Kitchen Creations, or affecting Kitchen Creations to the point of no profit. 1 month 16.2 Proactive Planning Management teams will visit the various regions one every 3-6 months to monitor processes, environment, to ensure that standards are being upheld. These visits will also help us to build relationships with our partners, which will give us a local contact for information sharing. For the first 5 years, monthly sales and budget analyses will be conducted to ensure that we are on plan. Our Director of Foreign Relations will be directly responsible for monitoring current events, market conditions, and political situations so that we can be prepared and plan ahead in the face of a crisis. Summary We sincerely hope you enjoyed our presentation. We hope you share in our excitement over the global success Kitchen Creations can achieve. With your help, we can accomplish great things in virtually untapped markets. With the further development of countries worldwide, there is a tremendous opportunity for growth. Kitchen Creations hopes
- 59. Kitchen Creations 59 to capitalize on that opportunity. We hope that you will share in and support our vision, creating an extremely successful partnership. We are confident that we have considered all aspects of this expansion and are fully prepared to make it an extremely profitable endeavor.
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Food Preparation Business Plan
Start your own food preparation business plan
What's For Dinner?
Company summary company overview ) is an overview of the most important points about your company—your history, management team, location, mission statement and legal structure.">.
What’s For Dinner? is a unique business where customers come to our Plano, TX location and prepare twelve pre-chosen meals that will be taken home and frozen until they are ready to cook and serve. All of the planning, shopping, food preparation and containers are provided with no worries to the customer. The meals will be prepared in a party like atmosphere where customers will have separate workstations to prepare their meals and have a good time with friends, both new and old.
Our goal is to provide our customers with home cooked meals that their families will enjoy, while saving them time and effort and relieve stress from that age-old question of What’s For Dinner?
The scheduling aspect of our company will be combination of a standard walk-up scheduling procedure, a phone messaging service and an intensive highly-interactive e-commerce website that will allow the customer to not only schedule parties but also to pay online, using standard secure technology.
2.1 Start-up Summary
The start-up expenses include:
- Rent expenses include a deposit and rent for one month at $28.75 per square foot for 1,854 square feet, in the total amount of $5,182.
- Utilities expenses for one month.
- Insurance deposit and first month.
- Sales & Marketing expenses including stationery, brochures, outdoor signage.
- Website development.
- Office, kitchen and janitorial supply expenses.
- Leasehold improvements, including contractors fees and permits.
The required start-up assets of $50,000 include:
- Kitchen Equipment (long-term assets)
- Prep Tables (long-term assets)
- Cooking utensils
- Various Kitchen Utensils
- Computer and small business software
Please note that the long-term assets above will be depreciated using G.A.A.P. approved straight-line depreciation method.
The purpose of this business plan is to secure $259,708 in funding. This loan appears in the long-term liability row of the attached Start-up Funding table.
The following chart and table summarize the start-up assumptions.
2.2 Company Ownership
What’s For Dinner? is a privately held Sub Chapter S-corporation. This allows for the protection allowed by the corporate legal structure combined with the “fall through” Generally Accepted Accounting Principals that will make personal financial sense to the corporations principle owners. The principle owners of What’s For Dinner? are Alan and Kim Kirby; each owns a 50% stake in the company. This company operates under the jurisdiction of the State of Texas and the United States of America.
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How to Start a Kitchen Supplies Store
Kitchen supplies stores sell cooking-related items like silverware, dishes, and cookware to everyday people, restaurant owners, culinary institutes, and others.
Ready to form your LLC? Check out the Top LLC Formation Services .
Learn how to start your own Kitchen Supplies Store and whether it is the right fit for you.
Start a kitchen supplies store by following these 10 steps:
- Plan your Kitchen Supplies Store
- Form your Kitchen Supplies Store into a Legal Entity
- Register your Kitchen Supplies Store for Taxes
- Open a Business Bank Account & Credit Card
- Set up Accounting for your Kitchen Supplies Store
- Get the Necessary Permits & Licenses for your Kitchen Supplies Store
- Get Kitchen Supplies Store Insurance
- Define your Kitchen Supplies Store Brand
- Create your Kitchen Supplies Store Website
- Set up your Business Phone System
There is more to starting a business than just registering it with the state. We have put together this simple guide to starting your kitchen supplies store. These steps will ensure that your new business is well planned out, registered properly and legally compliant.
Exploring your options? Check out other small business ideas .
STEP 1: Plan your business
A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:
- What are the startup and ongoing costs?
- Who is your target market?
How much can you charge customers?
What will you name your business.
Luckily we have done a lot of this research for you.
What are the costs involved in opening a kitchen supplies store?
The business requires a store, inventory, insurance, employees, a computer, high-speed internet, a point of sale system, cash registers, and marketing. In terms of inventory, it is advisable to stock everything commonly used in a kitchen from silverware to pots, pans, slow cookers, spatulas, soup ladles, microwaves, convection ovens, plates, bowls, cups, mugs, and beyond.
What are the ongoing expenses for a kitchen supplies store?
Ongoing expenses include the cost of the facility's rent or mortgage payment, wages/salaries, inventory expenses, facility maintenance, insurance, utilities, high-speed internet, and advertising. A kitchen supplies store manager will earn about $30,000 to $50,000 per year. Low-level clerks, cashiers, shelf-stockers and customer service representatives will earn between $8 and $12 per hour. Plan on spending at least $500 to $1,000 per year on facility maintenance. Inventory is an ongoing cost that fluctuates according to the amount of product you sell. Plan on spending about $500 to a couple thousand dollars per month on new inventory. If you decide to rent the building in which you sell kitchen supplies, budget in at least $700 to $1,500 for rent. Utilities including high-speed internet will cost between $150 and $300 per month. Marketing costs hinge on the level of exposure you desire for your kitchen supplies store. Budget at least $200 per month at a bare minimum for marketing. If you are intent on getting the business's name out there, plan to spend upwards of $500 per month or more on marketing.
Who is the target market?
The ideal customer is a manager or owner of a restaurant who is willing to spend a significant amount of money on kitchen supplies. Another ideal customer type is an individual who makes the purchasing decisions for a local culinary institute. Such a person is inclined to regularly spend large sums of money on kitchen supplies for the institute's cooking classes. It will also help to recruit cafeteria managers from local schools and medical facilities. These individuals are also in position to spend a significant amount of money.
How does a kitchen supplies store make money?
This business makes money by selling kitchen supplies to everyday people, restaurants, culinary institutes, and other institutions like hospitals and schools that have cafeterias.
You can charge a wide array of prices for various kitchen supplies. As an example, a spatula will cost as little as a couple dollars while a slow cooker will retail for around $50 and a fondue maker will cost upwards of $100.
How much profit can a kitchen supplies store make?
This type of store can make anywhere from $20,000 to $50,000 or more in the first year. Develop the business, reduce costs, and establish a niche, and profits can reach six figures in a couple years. Expand the business across your town, region, and the nation and the business has the potential to make millions of dollars in profit.
How can you make your business more profitable?
Consider selling items related to cooking such as dining room furniture, cabinets, kitchen islands and so on. You can also sell cookbooks and cooking show DVDs to those who are interested in learning how to cook new dishes and with new methods. You can maximize profit by selling tickets to cooking lessons held on-site. However, this will require hiring a cooking instructor. It is also possible to build a website to sell kitchen supplies to locals as well as those across the nation. If you are willing to invest in a delivery system to transport the items sold on your website, this addition to your business makes plenty of sense.
Choosing the right name is important and challenging. If you don’t already have a name in mind, visit our How to Name a Business guide or get help brainstorming a name with our Kitchen Supplies Store Name Generator
If you operate a sole proprietorship , you might want to operate under a business name other than your own name. Visit our DBA guide to learn more.
When registering a business name , we recommend researching your business name by checking:
- Your state's business records
- Federal and state trademark records
- Social media platforms
- Web domain availability .
It's very important to secure your domain name before someone else does.
Find a Domain Now
Powered by godaddy.com, step 2: form a legal entity.
The most common business structure types are the sole proprietorship , partnership , limited liability company (LLC) , and corporation .
Establishing a legal business entity such as an LLC or corporation protects you from being held personally liable if your kitchen supplies store is sued.
Form Your LLC
Read our Guide to Form Your Own LLC
Have a Professional Service Form your LLC for You
Two such reliable services:
You can form an LLC yourself and pay only the minimal state LLC costs or hire one of the Best LLC Services for a small, additional fee.
Recommended: You will need to elect a registered agent for your LLC. LLC formation packages usually include a free year of registered agent services . You can choose to hire a registered agent or act as your own.
STEP 3: Register for taxes
You will need to register for a variety of state and federal taxes before you can open for business.
In order to register for taxes you will need to apply for an EIN. It's really easy and free!
You can acquire your EIN for free through the IRS website, via fax, or by mail. If you would like to learn more about EINs and how they can benefit your LLC, read our article, What is an EIN?.
Learn how to get an EIN in our What is an EIN guide or find your existing EIN using our EIN lookup guide.
Small Business Taxes
Depending on which business structure you choose, you might have different options for how your business will be taxed. For example, some LLCs could benefit from being taxed as an S corporation (S corp).
You can learn more about small business taxes in these guides:
- Sole Proprietorship vs LLC
- LLC vs Corporation
- LLC vs S Corp
- How to Start an S Corp
- S Corp vs C Corp
There are specific state taxes that might apply to your business. Learn more about state sales tax and franchise taxes in our state sales tax guides.
STEP 4: Open a business bank account & credit card
Using dedicated business banking and credit accounts is essential for personal asset protection.
When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil .
Additionally, learning how to build business credit can help you get credit cards and other financing in your business's name (instead of yours), better interest rates, higher lines of credit, and more.
Open a business bank account
Besides being a requirement when applying for business loans, opening a business bank account:
- Separates your personal assets from your company's assets, which is necessary for personal asset protection.
- Makes accounting and tax filing easier.
Recommended: Read our Best Banks for Small Business review to find the best national bank or credit union.
Open net 30 accounts
Net 30 accounts are used to establish and build business credit as well as increase business cash flow. With a net 30 account, businesses buy goods and repay the full balance within a 30-day term.
NetMany net 30 credit vendors report to the major business credit bureaus (Dun & Bradstreet, Experian Business, and Equifax Business Credit). This is how businesses build business credit so they can qualify for credit cards and other lines of credit.
Recommended : Read our best net 30 vendors , guide and start building business credit.
Get a business credit card
Getting a business credit card helps you:
- Separate personal and business expenses by putting your business' expenses all in one place.
- Build your company's credit history, which can be useful to raise money later on.
Recommended: Apply for an easy approval business credit card from Divvy and build your business credit quickly.
STEP 5: Set up business accounting
Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.
Make LLC accounting easy with our LLC Expenses Cheat Sheet.
STEP 6: Obtain necessary permits and licenses
Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.
State & Local Business Licensing Requirements
Certain state permits and licenses may be needed to operate a kitchen store. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits .
Most businesses are required to collect sales tax on the goods or services they provide. To learn more about how sales tax will affect your business, read our article, Sales Tax for Small Businesses .
For information about local licenses and permits:
- Check with your town, city or county clerk’s office
- Get assistance from one of the local associations listed in US Small Business Associations directory of local business resources .
Certificate of Occupancy
A kitchen store is generally run out of a storefront. Businesses operating out of a physical location typically require a Certificate of Occupancy (CO). A CO confirms that all building codes, zoning laws and government regulations have been met.
- If you plan to lease a location :
- It is generally the landlord’s responsibility to obtain a CO.
- Before leasing, confirm that your landlord has or can obtain a valid CO that is applicable to a kitchen store.
- After a major renovation, a new CO often needs to be issued. If your place of business will be renovated before opening, it is recommended to include language in your lease agreement stating that lease payments will not commence until a valid CO is issued.
- If you plan to purchase or build a location :
- You will be responsible for obtaining a valid CO from a local government authority.
- Review all building codes and zoning requirements for your business’ location to ensure your kitchen store will be in compliance and able to obtain a CO.
STEP 7: Get business insurance
Just as with licenses and permits, your business needs insurance in order to operate safely and lawfully. Business Insurance protects your company’s financial wellbeing in the event of a covered loss.
There are several types of insurance policies created for different types of businesses with different risks. If you’re unsure of the types of risks that your business may face, begin with General Liability Insurance . This is the most common coverage that small businesses need, so it’s a great place to start for your business.
Learn more about General Liability Insurance .
Another notable insurance policy that many businesses need is Workers’ Compensation Insurance . If your business will have employees, it’s a good chance that your state will require you to carry Workers' Compensation Coverage.
STEP 8: Define your brand
Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will help your business stand out from competitors.
If you aren't feeling confident about designing your small business logo, then check out our Design Guides for Beginners , we'll give you helpful tips and advice for creating the best unique logo for your business.
Recommended : Get a logo using Truic's free logo Generator no email or sign up required, or use a Premium Logo Maker .
If you already have a logo, you can also add it to a QR code with our Free QR Code Generator . Choose from 13 QR code types to create a code for your business cards and publications, or to help spread awareness for your new website.
How to promote & market a kitchen supplies store
Promotion of the business starts with pressing the flesh. Network with those who make purchasing decisions for their cafeteria, restaurant or other institution that needs kitchen supplies to prepare food. Connect with everyday people through all different forms of marketing. Advertise in local papers, on local radio, local TV, etc. Post flyers, put up billboard ads, and purchase some online ads. Explore all of these marketing avenues and you will reach a wide variety of people in your community.
How to keep customers coming back
Establish a website and add search engine-optimized content at least several times per month. A steady supply of keyword-laden content will help those who need kitchen supplies find your business when conducting online searches. Attend conferences and other networking events related to food and cooking. These get-togethers are your chance to connect with restaurant owners and managers of other institutions that require large amounts of cooking supplies.
Still unsure about what kind of business you want to start? Check out the latest Small Business Trends to help inspire you.
STEP 9: Create your business website
After defining your brand and creating your logo the next step is to create a website for your business .
While creating a website is an essential step, some may fear that it’s out of their reach because they don’t have any website-building experience. While this may have been a reasonable fear back in 2015, web technology has seen huge advancements in the past few years that makes the lives of small business owners much simpler.
Here are the main reasons why you shouldn’t delay building your website:
- All legitimate businesses have websites - full stop. The size or industry of your business does not matter when it comes to getting your business online.
- Social media accounts like Facebook pages or LinkedIn business profiles are not a replacement for a business website that you own.
- Website builder tools like the GoDaddy Website Builder have made creating a basic website extremely simple. You don’t need to hire a web developer or designer to create a website that you can be proud of.
Using our website building guides , the process will be simple and painless and shouldn’t take you any longer than 2-3 hours to complete.
Recommended : Get started today using our recommended website builder or check out our review of the Best Website Builders .
Other popular website builders are: WordPress , WIX , Weebly , Squarespace , and Shopify .
STEP 10: Set up your business phone system
Getting a phone set up for your business is one of the best ways to help keep your personal life and business life separate and private. That’s not the only benefit; it also helps you make your business more automated, gives your business legitimacy, and makes it easier for potential customers to find and contact you.
There are many services available to entrepreneurs who want to set up a business phone system. We’ve reviewed the top companies and rated them based on price, features, and ease of use. Check out our review of the Best Business Phone Systems 2023 to find the best phone service for your small business.
Recommended Business Phone Service: Phone.com
Phone.com is our top choice for small business phone numbers because of all the features it offers for small businesses and it's fair pricing.
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Is this Business Right For You?
This business is ideal for people who have a passion for food and cooking. If you have worked in a restaurant, are an excellent cook, or simply desire to be involved in a food-related business, opening a kitchen supplies store is an excellent idea. After all, people will always need to eat, and the vast majority of food requires preparation of some sort. Kitchen supplies are necessary for that preparation.
Want to know if you are cut out to be an entrepreneur?
Take our Entrepreneurship Quiz to find out!
Entrepreneurship Quiz
What happens during a typical day at a kitchen supplies store?
A kitchen supplies store owner handles a wide range of activities. He manages inventory, decides on marketing strategies, delegates work to employees, stays abreast of cutting edge cooking trends, researches new kitchen supplies, and establishes relationships with product suppliers.
What are some skills and experiences that will help you build a successful kitchen supplies store?
A kitchen supplies store owner who stays up to date on the latest cooking trends will have a leg up on the competition. Never stop learning about cooking methods and cooking equipment. Be personable. Establish relationships with those who make purchasing decisions at local institutions where food is served. It will also help to have marketing prowess so you can advertise your kitchen supplies store in a highly effective manner.
What is the growth potential for a kitchen supplies store?
This type of business has serious growth potential. The bottom line is that people and institutions will always require cookware, utensils, dishes, and other items that relate to the cooking process. Locate your kitchen supplies store in the right area and establish relationships with those who regularly buy large amounts of kitchen supplies, and your business can rapidly expand. It is possible to open up a second location within a year or two. You can eventually expand to multiple locations across your region and the country.
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Take the Next Step
Find a business mentor.
One of the greatest resources an entrepreneur can have is quality mentorship. As you start planning your business, connect with a free business resource near you to get the help you need.
Having a support network in place to turn to during tough times is a major factor of success for new business owners.
Learn from other business owners
Want to learn more about starting a business from entrepreneurs themselves? Visit Startup Savant’s startup founder series to gain entrepreneurial insights, lessons, and advice from founders themselves.
Resources to Help Women in Business
There are many resources out there specifically for women entrepreneurs. We’ve gathered necessary and useful information to help you succeed both professionally and personally:
If you’re a woman looking for some guidance in entrepreneurship, check out this great new series Women in Business created by the women of our partner Startup Savant.
What are some insider tips for jump starting a kitchen supplies store?
You can jump start your kitchen supplies store business by establishing relationships with those who are in need of your products. These individuals include managers and owners of restaurants, culinary institutes, hospitals, schools, colleges etc. It will also help to establish a strength in one particular cooking category such as gourmet cooking, confectionery supplies, or baking. If you establish a reputation as the go-to source for such specific cooking supplies, you will enjoy consistent business from those who need such cookware.
How and when to build a team
Begin building your team right away. You can't operate an entire kitchen supplies store on your own. Add employees to man the cash registers, stock the shelves, order new inventory, and assist customers. You will eventually have to add a store manager, a marketing expert, and an accountant as the business grows.
Get more ideas with our Business Ideas Generator .
Check out our How to Start a Business page.
Sign up at the Business Center to access useful tools for your business.
Useful Links
Industry opportunities.
- Pantry Magic Franchise opportunity
- National Kitchen & Bath Association
Real World Examples
- Online business
- Philadelphia business
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Further Reading
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Related Business Ideas
Coronavirus Small Business Relief
Commercial Cleaning Business
Personal Chef Business
Grocery Store
Kitchen and Bath Store
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THIS BOOK IS A COMPLETED KITCHEN & COOKWARE STORE BUSINESS PLAN and it is provided to you with all the additional information you will need to complete your own. Starting and operating your own business is not just the American dream, it is the pathway to wealth. And a business plan is critical to forming the right strategy and taking the steps needed to ensure success. THIS IS NOT A BASIC TEMPLATE. This book, unlike so many others, has actually done most of the work for you. While most books are vague and give you one sentence explanations of what you should include, this book is near complete.
About this book
Books related to a complete kitchen & cookware store business plan: a key part of how to start a kitchen supply store, more by in demand business plans, ebook details.
- In Demand Business Plans
- Release Date: May 26, 2017
- Imprint: Smashwords Edition
- ISBN: 9781370390281
- Language: English
- Download options: EPUB 2 (DRM-Free)
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- Business Idea
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16 Tips About Kitchen Utensils Business
16 Tips About Kitchen Utensils Business : Starting a kitchen supplies store can be easy with the right information.
Learn what’s involved in opening a kitchen supplies store.
Kitchen supplies stores sell cooking-related items like silverware, dishes, and cookware to everyday people, restaurant owners, culinary institutes, and others.
Kitchen Utensils Business
1. Idea about the business :
This business is ideal for people who have a passion for food and cooking.
If you have worked in a restaurant, are an excellent cook, or simply desire to be involved in a food-related business, opening a kitchen supplies store is an excellent idea.
After all, people will always need to eat, and the vast majority of food requires preparation of some sort.
Kitchen supplies are necessary for that preparation.
2. Activities involved:
A kitchen supplies store owner handles a wide range of activities.
He manages inventory.
Decides on marketing strategies.
Delegates work to employees.
Stays abreast of cutting edge cooking trends.
Researches new kitchen supplies.
And establishes relationships with product suppliers.
3. Marketing strategies:
The ideal customer is a manager or owner of a restaurant who is willing to spend a significant amount of money on kitchen supplies.
Another ideal customer type is an individual who makes the purchasing decisions for a local culinary institute.
Such a person is inclined to regularly spend large sums of money on kitchen supplies for the institute’s cooking classes.
It will also help to recruit cafeteria managers from local schools and medical facilities.
These individuals are also in position to spend a significant amount of money.
4 . How to make sales:
This business makes money by selling kitchen supplies to everyday people, restaurants, culinary institutes , and other institutions like hospitals and schools that have cafeterias.
5. Growth potential:
This type of business has serious growth potential.
The bottom line is that people and institutions will always require cookware, utensils, dishes, and other items that relate to the cooking process.
Locate your kitchen supplies store in the right area and establish relationships with those who regularly buy large amounts of kitchen supplies.
And your business can rapidly expand.
It is possible to open up a second location within a year or two.
You can eventually expand to multiple locations across your region and the country.
6. Skills and experiences:
A kitchen supplies store owner who stays up to date on the latest cooking trends will have a leg up on the competition.
Never stop learning about cooking methods and cooking equipment.
Be personable. Establish relationships with those who make purchasing decisions at local institutions where food is served.
It will also help to have marketing prowess so you can advertise your kitchen supplies store in a highly effective manner.
7. Costs involved:
The business requires a store, inventory , insurance, employees, a computer, high-speed internet, a point of sale system, cash registers, and marketing.
In terms of inventory.
It is advisable to stock everything commonly used in a kitchen from silverware to pots, pans, slow cookers, spatulas, soup ladles, microwaves, convection ovens, plates, bowls, cups, mugs, and beyond.
8.Establishing Relationships:
You can jump start your kitchen supplies store business by establishing relationships with those who are in need of your products.
These individuals include managers and owners of restaurants, culinary institutes, hospitals, schools, colleges etc.
It will also help to establish a strength in one particular cooking category such as gourmet cooking, confectionery supplies , or baking.
If you establish a reputation as the go-to source for such specific cooking supplies.
You will enjoy consistent business from those who need such cookware.
9. Promote the Business:
Promotion of the business starts with pressing the flesh.
Network with those who make purchasing decisions for their cafeteria, restaurant or other institution that needs kitchen supplies to prepare food.
Connect with everyday people through all different forms of marketing.
Advertise in local papers, on local radio, local TV , etc. Post flyers, put up billboard ads, and purchase some online ads.
Explore all of these marketing avenues and you will reach a wide variety of people in your community.
See also: Tips on how to Promote Your Business
10. Retaining Customers:
Establish a website and add search engine-optimized content at least several times per month.
A steady supply of keyword-laden content will help those who need kitchen supplies find your business when conducting online searches.
Attend conferences and other networking events related to food and cooking.
These get-togethers are your chance to connect with restaurant owners and managers of other institutions that require large amounts of cooking supplies.
11. Build a team
Begin building your team right away.
You can’t operate an entire kitchen supplies store on your own.
Add employees to man the cash registers, stock the shelves, order new inventory, and assist customers.
You will eventually have to add a store manager, a marketing expert, and an accountant as the business grows.
Read also: BUILDING TEAM NETWORKING BUSINESS IN NIGERIA
12. Get a License/ Certificate of Occupancy:
Certain state permits and licenses may be needed to operate a kitchen store. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.
A kitchen store is generally run out of a storefront. Businesses operating out of a physical location typically require a Certificate of Occupancy (CO). A CO confirms that all building codes, zoning laws and government regulations have been met.
- It is generally the landlord’s responsibility to obtain a CO.
- Before leasing, confirm that your landlord has or can obtain a valid CO that is applicable to a kitchen store.
- After a major renovation, a new CO often needs to be issued. If your place of business will be renovated before opening , it is recommended to include language in your lease agreement stating that lease payments will not commence until a valid CO is issued.
- You will be responsible for obtaining a valid CO from a local government authority.
- Review all building codes and zoning requirements for your business’ location to ensure your kitchen store will be in compliance and able to obtain a CO.
13. Customer’s charges:
You can charge a wide array of prices for various kitchen supplies.
As an example , a spatula will cost as little as #2oo while a slow cooker will retail for around #45000.
14. Required Expenses:
Ongoing expenses include the cost of the facility’s rent or mortgage payment.
Wages/salaries,
Inventory expenses.
Facility maintenance.
Utilities, high-speed internet, and advertising.
A kitchen supplies store manager will earn about #30,000 to #50,000 per month.
15. Expected Profit:
This type of store can make anywhere from #200,000 to #500,000 or more in the first year.
Develop the business, reduce costs, and establish a niche, and profits can reach six figures in a couple years.
Expand the business across your town, region, and the nation and the business has the potential to make millions of dollars in profit.
16. Selling ideas:
Consider selling items related to cooking such as dining room furniture, cabinets, kitchen islands and so on.
You can also sell cookbooks and cooking show DVDs to those who are interested in learning how to cook new dishes and with new methods.
You can maximize profit by selling tickets to cooking lessons held on-site.
However, this will require hiring a cooking instructor.
It is also possible to build a website to sell kitchen supplies to locals as well as those across the nation.
If you are willing to invest in a delivery system to transport the items sold on your website , this addition to your business makes plenty of sense.
Read also:Top 6 Kitchen Wares Business
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