Business Plan for Prashanti's sauces
Executive Summary
Prashanti's is a manufacturer of authentic Indian foods including atjar and spices. Prashanti's has been in business now for three years and has grown in popularity. What was once a business targeting solely the Indian community has grown into a business that has nationwide appeal.
Currently, Prashanti's has two main line of products. Their flagship product is their atjar, renowned for its freshness, uniqueness, and quality ingredients. Originally introduced in one temperature, hot, the market demand has asked for milder temperatures and Prashanti's has responded with both a medium and mild version. To compliment their product line, Prashanti's offers dried spices.
Prashanti's strong management team of Krish and Prashanti Naidoo will ensure sustainable growth for Prashanti's. Prashanti is the President and has 12 years of food industry experience which has provided Prashanti with incredible insight and industry knowledge that reinforced the idea to start a business from scratch. Krish brings Prashanti's over six years of financial control experience that was gained while he worked for PWC.
Objectives
- Increase sales to more than R1 million over the next three years.
- Add products and services to meet market demand, again at 55% margin or above.
- Improve inventory turnover, reduce the cost of goods sold while maintaining the high quality of the products.
Mission
Offering the highest quality and value in its authentic hot atjar, and to keep on improving on what is available and providing new products and services to the areas of need.
Keys to Success
Delivering high quality products that set themselves apart from the others in taste and value.
Providing service, support, and a better than average margin to our dealers.
Increase gross margin to over 55%.
Bring new products into the mix to increase sales volume.
Company Summary
Prashanti's is in its third year of operation, increasing sales five-fold in its second year, and is on track to repeat this in its third year. It has a good reputation, excellent people, and an increasing position in the local market. Starting with a few outlets for our products, we now have over 5 large grocery.
Company Ownership
Prashanti's is a Closed Corporation owned in total by its co-founders, Krish and Prashanti Naidoo.
Products
Prashanti's sells its authentic Indian atjar and spices to an ever-growing clientele. Originally geared toward the local Indian community, the market has expanded to include a much larger geographical area, in addition to a very broad consumer response.
We are selling quality and product-uniqueness in a market segment filled with competition. Our approach is to take our product image up-market because of our uncompromising view of product quality. This focus has enabled us to view the voids in the market, and add product to our line that will fill it.
Target Market Segment Strategy
We are initially focusing on the Indian community. They will be able to appreciate more readily the authenticity of the product. The market will observe the products they choose, and they will indirectly become promoters of our products.
Industry Analysis
In an industry currently in a steady upward growth curve, Prashanti's is poised to capitalize on the consumer's desire for authentic, high quality, Indian cuisine.
While a troubling economy can affect many areas, food items are generally not as affected, with specialty items seeming to always find favor in the market place.
Competition and Buying Patterns
While there are currently several vendors in this market selling competitive products, the commonality of those products provides an opening in the marketplace for the vibrant packaging and positioning of Prashanti's atjar and spices. We stand out on the shelf, we stand out in the restaurant, and we will stand out in the mind of the consumer.
Sales Strategy
The keys to our continuing success are in the areas we are adding to our current distribution channels. This will remain our main focus for the next five years. Sales calls on the following enterprises have resulted in Prashanti's Atjar being stocked and sold by them.
- DBS Retailers
- Pick and Pay Group
- Spar Inc
- 7 Eleven Group
- Woolworths Food
Sales Forecast
We currently forecast our sales to grow at the rate of 200% for the next 12 months because of written commitments we have received from distributors intending to take on our product line in larger volumes in the future.
This growth will continue, but at a lower rate of 120% for the next year, and by 70% the following year. We anticipate the growth rate to flatten out to a consistent 20% within five years, but to remain steady. Should the market on Indian food items continue at its current pace, we will keep pace with it. Our forecast does assume a downturn in the product within a three-year period, and the lower figures of 20% are a reflection of that forecast. We would be happy if it didn't falter.
Management Summary
Prashanti Naidoo - President
Prashanti is currently responsible for the preparation of atjar and maintaining the various inventories of raw materials; purchasing of food ingredients; assistance with packaging and shipping. In addition, she maintains the company records and is in direct communication with the accountant and other advisors.
Krish Naidoo - Vice President
Krish assists with the preparation and production of atjar; maintains the inventory of the finished products; is responsible for packing and shipping; assists with recordkeeping and cost containment. Krish also shares in the marketing and promotion of the product.
Personnel Plan
The current personnel plan calls for Prashanti to become a paid employee on or about August 1st. Although she has been working for Prashanti's since it's inception two years ago, she has not drawn a salary or been reimbursed for expenses. We are then planning on Krish taking a paid position with Prashanti's by early 2013.
Financial Plan
We have forecast a very rapid growth for Prashanti's this year. Although this may seem ambitious based on historic sales, this rate of growth is due to the large orders we have received to date from several distributors, letters of commitment from Spar Group and Woolworths, and the increasing number of orders from current clients.
Please refer to our Financial Plan page for more information on what the Financial Plan entails.
Break-even Analysis
Please refer to our Financial Plan page for a formula to calculate the Break-even point.
Projected Cash Flow
Click here to download a Cash Flow template.
Projected Income Statement (Profit and Loss)
Click here to download an Income Statement template.
Projected Balance Sheet
Click here to download a Balance Sheet template.
