Setting up a new business requires a lot of preparation. In doing this, it is helpful to put together a business plan. A well-explained plan allows you to go to the bank and ask for a loan, or to propose your venture to potential investors.

We’ll explore the following five key business plan sections in this guide:

  • Description of your business
  • Explaining your market
  • SWOT analysis
  • Food hygiene
  • Financial projection

Description of your business

The first section to include within your business plan is a description of your business. Define your idea and explain what it is to whoever reads the plan. For your bakery business, this may include expressing what will be unique about the products you sell.

The USP (unique selling point) is the core of any new business, and you can use it to convince lenders or investors to invest in your business. Your USP could be exceptionally amazing recipes or unusual styles of baking. Perhaps you have a new way of providing your products to customers. Whatever it may be, identify the need for the product and explain how your business will fill it.

This section can also include any progress you have made on branding. For example, you may have decided on a name and logo, which will go a long way to proving you have thought about the venture commercially.

Explaining your market

By this stage, you may have carried out some market research, which will provide you with some ideas about the audience for your product. To help explain to a reader the target market, you can write out a consumer profile.

Also known as a customer avatar, a consumer profile is a hypothetical customer. You can include a name, age, location, occupation and income. You then write a description about this person, their family and their lifestyle. This person should be a distillation of the audience you would like to target. 

Besides the audience, it is also helpful to explain the size of the market resulting in research into how your competitors are doing in other bakeries. If you can prove that these businesses are popular, whoever you are presenting to will trust your plan more.

SWOT analysis

A SWOT analysis can help you gauge the competition and plan ahead to meet the needs of your business.  It includes your venture’s strengths, weaknesses, opportunities and threats.

Strengths

The business’ strengths should be a chance for you to express everything the venture has going for it. For example, if you are setting up the bakery as an experienced baker, talk about your previous roles and the amount of time you have been in the food business. 

If you are using vegan ingredients, talk about how many people have been buying that sort of food in recent years. Make any advantage that you can think of about your business shine.

Weaknesses

The weaknesses of the business should be an honest reflection of the areas you feel could be improved. If there are certain disadvantages you may be facing, it is essential to express them. 

It’s vital for your plan to be realistic to be believable. Every business will have weaknesses. It is critical for potential investors to see that you have considered them and plan to work on specific business areas.

Opportunities

Discussing opportunities will demonstrate your ability to be creative in your approach to business.

You can mention upcoming events your bakery will take advantage of, for example, or ways that you could grow the business in the future. Express a good level of optimism, and you will find it easier to make someone else as excited about the business as you.

Threats

Just as important as potential opportunities are the threats your business could face. These could include anything that may have an impact on your business.

Preparing for threats proves that you won’t crumble under pressure when the business gets going. Examples could include what you would do if another bakery opened in the same street or if a pandemic-related lockdown meant closing the store. Also, explaining ways to solve potential problems makes you look capable and makes your business more appealing.

Food hygiene

In a bakery business, your primary product is going to be food. Therefore mentioning food hygiene could be very useful in your business plan. The UK Government website offers guidance on food hygiene rules, many of which are legal requirements.

The four main points to consider for the food business’ are the 4C’s:

  • Cleaning
  • Cooking
  • Chilling
  • Cross-contamination

Ensuring that your bakery complies with food hygiene regulations will reassure concerned investors and lenders. Knowing where to focus attention for hygiene, you can outline how you will make sure that all equipment is cleaned correctly, for example.

Financial projection

You can use market research and what you’ve learnt about your competitors to create a financial projection. Include information about product pricing, and short-term and long-term sales projections. Putting together a sales forecast provides potential investors (or the bank) with a succinct overview of how you expect your business to perform.

You may also want to outline how you intend to use the sources of finance you are asking for, making sure that your calculations are correct. Often this is difficult and time-consuming, but using an accounting app like Countingup can make it more manageable.

The app that makes finance easy as pie

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Countingup is a business current account with built-in accounting software that allows you to manage all your financial data in one place. 

With features like automatic expense categorisation, invoicing on the go, receipt capture tools, tax estimates, and cash flow insights, you can confidently keep on top of your business finances wherever you are. 

You can also share your bookkeeping with your accountant instantly without worrying about duplication errors, data lags or inaccuracies. Seamless, simple, and straightforward! 

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