Darlenes Desserts

Business Plan
Alexis Babcock

Table of Contents
Executive Summary ..4
Company Profile ...5
Legal Form of Business ..5
Effective Date of Business ..............................................................................................5
Company Mission Statement ..5
Company Governance .5
Company Location ..5
Immediate Developmental Goals ....5
Overview of Financial Status ..6
Industry Analysis ..7
Description of Industry ...7
Size and Scope ....7
Growth Rates ..7
Nature of Competition ....7
History 7
Trends .8
Strategic Opportunities ...8
Target Market ...9
Target Market Defined ....9
Market Potential ..9
Key Competitors .9
The Mix Cafe and Bakery ...9
The Cupboard Deli ..9
158 Main Restaurant and Bakery ....9
Edelweiss Bakery & Cafe Coffee ...9
The Family Table ....9
Potential Future Competitors ....10
Barriers for Entry ..10
Marketing Plan and Sales Strategy ...11
Key Message .11
Message Delivery ..11
Sales Procedure .....11
Operations ...12
Business Facilities ....12
Production Plan ....12
Workforce ....12
Impact of Technology ......12

Management and Organization .13

Key Employees .13
Key Principles ...13
Vision ....13
Perception .13
Leadership .13
Reputation .13
Consistency ...13
Human Resources .13
Compensation and Incentives ...13
Long-term Development .14
Three-Five Year Goals ..14
Risks and Adverse Results ....14
Strategy for Achieving Goals ....14
Financials .15
Accounting System ...15
First Year Monthly Cash Flow......15
First Year Monthly Income Statement..........15
Yearly Income Statements for Years One, Three, & Five.16
Supporting Documents ...17
Works Cited ..17

Executive Summary
Darlenes Desserts is a business focused on providing specialty diet baked goods to those with
dietary needs. The business focus is to create baked goods that are not only tasty, but can be
enjoyed by those with food allergies as well as those without. The demand for gluten and dairy
free foods is on the rise, as more and more people develop food allergies and sensitivities. People
are always on the lookout for delicious desserts that they can enjoy while maintaining their
necessary dietary restrictions.
Darlenes Desserts is structured as a Limited Liability Company (LLC) owned and operated by
Alexis Babcock. Alexis already has a background in culinary arts as well as business, and is
looking to further her education in the future. She has 3 years of experience in the foodservice
industry from working at established bakeries and restaurants. She has learned a lot from her
experiences and is looking forward to putting the skills she has learned into action.
Due to the decision to run the business from her home, Darlenes Desserts will not require any
loans due to the low expenses of an in-home bakery. As a start-up, Vermont health codes do not
apply, until gross weekly sales average at least $250. Once this amount has been reached,
Vermont law requires an annual health inspection to be conducted. The start-up cash will come
from Alexis, who will start off operating part-time while she continues her education as well as
works other jobs in order to sustain herself and the business. The goal is to transition into a new
building and begin operating full-time within 5 years of opening. This permits Alexis to gain
more experience and education, which will allow for a better chance of success.

Company Profile
Legal Form of Business
Darlenes Desserts is a sole proprietorship in the form of a Limited Liability Company (LLC).
This form of legal status was chosen because as a small business start-up, accounting and
taxation are easier to track. Filing and reporting requirements are kept to a minimum, and the
platform provided by an LLC establishes a good foundation to build on as the business expands.
The necessary filing required includes articles of incorporation, federal tax identification number
(EIN), as well as filing with the Vermont Secretary of State.
Effective Date of Business
Founded in January 2015 by Alexis E. Babcock, Darlenes Desserts began operations by opening
its retail business in Jeffersonville, Vermont, on February 20, 2015.
Company Mission Statement
Darlenes Desserts is a from the home, from the heart bakery where every product is made
with care, affection, a passion for baking, and attention to detail. From simple recipes such as
cupcakes and brownies, to complex wedding cakes and specialty diet foods, this bakery produces
choice, top quality goods for you to enjoy, or to share with others.
Company Governance
As Alexis the sole owner and operator of Darlenes Desserts, all decisions will fall upon her, and
any profit/loss will be dealt with by her discretion.
Company Location
The companys office and place of production will be located at the residence of the owner, 2910
VT Route 108 South, Jeffersonville, VT 05464. Products will be distributed through local
sources or be delivered by arrangement until operations become large enough for a store front
location.
Immediate Developmental Goals
As a member of the food service industry, creating products of the best quality possible is a
constant goal. As the survival of a business relies on more than just tasty products, these are
some of the goals the business will be striving towards immediately upon opening:
Create and maintain strong customer relationships by striving to exceed expectations set
by the customer
Constantly work towards improving and perfecting production techniques to become
more time and cost efficient
Expand target market throughout the Northwestern corner of Vermont by advertising and
relying on word of mouth.

Overview of Companys Financial Status

Due to the location of the business being the owners home, there is no need to take out any
loans for renting property. The owner of Darlenes Desserts has money saved from previous
work, and will be using that as starting capital. Any profits will go into an account to be used to
purchase new inventory. For the first few years Darlenes Desserts will be a part-time business,
and the owner will be working other jobs on the side for additional income.

Industry Analysis
Description of Industry
The bakery industry usually refers to the grain-based food industry. Grain-based foods usually
include breads, cakes, pastries, baked pet treats, and the like. Along with bakeries, the industry
consists of the equipment, supplies, and delivery systems used to support the industry. Bakeries
are the main component of the bakery industry, and produce the actual goods.
Bakery sales may be retail, wholesale, or a combination of both. A retail bakery usually sells its
goods directly to the consumer. Many retail bakeries have physical stores, but some have online
outlets as well. Wholesale bakeries supply organizations such as restaurants, grocery stores,
schools, and company cafeterias.
Along with the bakeries, the bakery industry includes vendors for ingredients, equipment, and
supplies. Ingredients include flour, butter, eggs, and other food items needed to produce baked
goods. Equipment includes industrial ovens, scales, mixers, and refrigerators. Bakery supplies,
items such as: food-grade packaging, pans, and utensils are also part of the industry.
U.S. consumers are demanding more healthy baked comfort foods, which with those being at
opposite ends, is rather interesting. The bakery industry has bounced back from the recession due
to an emphasis on natural and organic ingredients, as well as smaller portion sizes. The healthy
proportions will help keep the cost of the specialty diet home-baked goods low.
Size and Scope
Looking at the 2011 snapshot of the bakery industry provided by the Center for Economic
Vitality, the combined annual revenues of commercial and retail bakeries totaled $33 billion.
While there are more retail bakeries than commercial (6,000 retail to the 2,800 commercial)
commercial bakeries produce 91% of that revenue.
Growth Rates
The demand for baked goods is on the rise, especially for specialty diet goodies. More and more
people are becoming gluten and dairy free, either by choice or by necessity. The industry has
been estimated to have a growth rate of 13-15% over the next 3-4 years. This allows for growth
of current bakeries, as well as the creation of new ones.
Nature of Competition
In the past when bakeries started, they focused on serving consumers as a whole, rather than
catering to one specific group of people. The need for specialty diet foods is on the rise, and the
demand for tasty treats that cater to those needs is ever-growing. As Darlenes Desserts will be
focusing on catering specifically to those with specialty food needs and wants, and due to the
low number of specialty bakeries in the state of Vermont, the competition wont be as fierce.
History
The first known act of baking took place around 4000 BC. This baking consisted of taking
wild grain found on the plains and soaking it in water, before mashing it together to make a
broth-like substance. Later on, once fire was discovered, this broth was poured onto the hot

embers of the fire where it baked into a flat bread. From there we developed ways of leavening,
using yeast to make the bread fluffy. Later on, as new places were discovered, spices were
introduced and used to create different flavors. As time went on, people began using different
ingredients and techniques to create unique products. The bakery industry is ever changing, ever
improving, and will continue to do so, as long as there are people in the world who enjoy baked
goods.
Trends
While looking at the current trends of the industry, there are a few that will need to be under
constant watch, as they could impact the success of my business. We will monitor those by
joining the industry email lists, as well as looking for any industry publications that could
provide useful information on the status of the industry. The trends we will be looking to monitor
are:
Consolidation: Larger commercial bakeries have started to merge, and together are producing
new product lines and are expanding their reach. A large part of this is caused by automation
(discussed below), because it makes it possible to achieve healthy goals in a slow growing
industry. Due to the cost of automation, many small businesses cannot afford it, giving the larger
companies the advantage.
Automation: As automation improves and becomes more accessible, bakers are able to produce a
more consistent quality along with improving yields. Those smaller bakeries that are able to
afford the initial investment in automation are able to significantly improve their outputs and
compete better against local larger bakeries.
Discounted resale: It is becoming more common for bakers to take back goods from retailers that
have not been sold by their freshness date and sell them through retail thrift stores. The current
business model for Darlenes Desserts does not include this revenue stream.
Strategic Opportunities
As times and diets change, the demands for specific types of baked goods change too. Today, the
need for specialty diet foods, such as gluten, dairy, and sugar free are at an all-time high.
Consumers are getting more health conscious, and reading labels more often. This is causing a
big rise in demand for all natural foods, and foods made from organic ingredients. There is a lot
of growth opportunity in the field of specialty diets, now that more and more people are taking
control of what they eat. The gluten-free market is estimated to grow 48% between 2013 and
2016. The dairy-free market is estimated to grow 21.3% in this time as well.

Target Market
Target Market Defined
In addition to individual sales, the business market for Darlenes Desserts comprising of
approximately 250-260 local business and community groups. Specialty food markets make up
approximately 15% of the general population. Including the general population, our goal is to
develop a 10% market share within 15 miles of the business.
Market Potential
The market for bakeries in Jeffersonville, Vermont has the potential to grow. As more people
become interested in local products, and want to support local businesses, the market will
expand. With people becoming sensitive about what they eat, having a specialty bakery in town
will provide them with the opportunity to get fresh baked products that are both easy on the
stomach, and the wallet.
Key Competitors
The key competitors in the area include: The Mix Cafe and Bakery, Cupboard Deli, 158 Main
Restaurant and Bakery, Edelweiss Bakery & Cafe Coffee, and The Family Table. All of them are
located within 20 minutes driving distance of Darlenes Desserts, and they all offer similar
products. Here is a summary of each business and what it offers:
The Mix Cafe and Bakery is a sit-down and eat restaurant, and they serve breakfast and lunch.
Their short menu offers limited options, however, their prices are low, and their food quality is
good.
The Cupboard Deli is a gas station, with no formal place to sit and eat. They offer deli and an
assortment of baked goods. In the summer, they open up their scoop shop, where they offer both
hard ice cream and soft serve.
158 Main Restaurant and Bakery is a sit-down and eat type of restaurant. They serve breakfast,
lunch, and dinner as well as offer take-out. They offer meals and desserts, and have recently
added a French baker to the mix as well.
Edelweiss Bakery & Cafe Coffee has both a sit-down and a take-out option. They offer
everything from sandwiches to cakes and clairs, however, due to their odd hours, not many
people are able to enjoy their products.
The Family Table is also a sit-down establishment, where they serve lunch and dinner on the
weekdays, and breakfast, lunch, and dinner on weekends. Their food is of good quality, but their
prices can be a tad too high, especially for events or large parties.
Other potential competitors include local bakeries which deliver their products to the local gas
stations. There is not a significant presence of specialty diet bakeries in Vermont. There are no
direct specialty food competitors in the local market area (15 miles) and few in Vermont, located
by an internet search.

Potential Future Competitors

Industry growth is expected to be approximately 50% over the next two years. Local business
growth is expected to be consistent. By keeping an eye on the community through Front Porch
Forum and other social media, we will be able to keep an eye out for any rising threats, and will
plan accordingly. We will also hope to use these same channels to help promote the business.
Barriers for Entry
There are several things that need to be taken into consideration before entering into this
industry. The first barrier is getting people to trust someone younger in age, and getting them to
do business with us. There is also the need to get the business name out there, and to get people
interested in our products. We will also need to get registered with the town, and take care of any
fees and permits that are needed in order to start operations. There are no local permits needed in
order to start a home business in the Cambridge/Jeffersonville area. There is a $35 filing fee for
creating the LLC with the Secretary of State, an approximate fee of $50 for the incorporation
documents, as well as a health code fee of $100.

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Marketing Plan and Sales Strategy

Key Message
Darlenes Desserts is dedicated to providing customized, fresh baked, top quality products that
are easy on your wallet and your digestion.
Message Delivery
Darlenes Desserts plans on using social media, such as Twitter, Facebook, and Front Porch
Forum to spread its message. It will also rely on ads through the local paper, and word of mouth.
We will also create a website, in which people can look at what we offer, as well as order
directly on the website.
Sales Procedure
The business will use the standard procedure for sales which is the 7 following steps:
1. Find potential clients through researching the needs and wants of the consumers in the
area, as well as looking for any events that may be happening. We will conduct surveys,
create a presence at community events where potential customers can sample our
offerings. The business will also partner with healthcare providers and health-oriented
programs as well as support groups to present workshops on how baked goods can be
tasty and still meet dietary needs.
2. Prepare to meet with potential clients after creating a list of who they might be.
3. Meet with potential clients and show them the list of products offered. The business will
set up a booth at the local farmers markets, both in Jeffersonville and the surrounding
areas.
4. Pay attention to what the potential client says, as it may help to gain their business
5. Answer any concerns that they may have to the best of our ability, because others may
share them.
6. Close the deal, once they accept, close the deal by thanking them and making sure to
follow through on the order.
7. Follow up after the sale is through, making sure that everything went well. This shows
that we care about them even after the sale, and will help build a relationship with the
customer, hopefully bringing them back. Future development will include a discount on
future purchases for those who refer new customers.
By following these guidelines, Darlenes Desserts hopes to create and maintain good customer
relationships, and gain more customers.

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Operations
Business Facilities
The business facilities include the kitchen and office of my home. The facilities to be used
include:
Kitchen
Stove
Oven
Sinks
Pots
Pans
Ingredients
Dry and Sanitary Storage Space
Water
Plumbing
Office

Computer
Printer
Office Supplies
Furniture

Production Plan
The business production plan will strive towards service excellence as well as producing quality
products. This will be done by undertaking modern production techniques, and using up-to-date
small batch equipment. This will result in a low cost for the company, as well as quality products
for the customers.
Workforce
The workforce will consist solely of the owner, Alexis Babcock. She will be responsible for the
whole process, from taking the order to making and delivering it to the customer. During peak
periods, however, she will be helped out by her family and friends who will help deliver the
products as well as make them.
Impact of Technology
Technology will be used to keep records of sales, inventory, and financials. All receipts will be
both online and in hard copy, thus ensuring that nothing gets lost. Technology will also be relied
upon for communication and production, such as orders, bids, and production reports. Though
technology has integrated itself into even the most basic functions of our lives, it is still
important for the owner to be able to do things by hand when necessary.

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Management and Organization

Key Employees
The key employee will be the owner, as everything falls on me to make sure it gets done and is
taken care of.
Key Principles
The key principles of the company will be as follows:
Vision the company will strive to be creative, passionate, and grow. With vision, all things are
possible.
Perception the company will always keep things in perception, and look at the big picture as a
whole.
Leadership the company will strive to become a leader and mentor to those around it.
Reputation the company will always do its best to protect and promote its reputation, as
reputations are very important.
Consistency the company will work hard to be consistent, as consistency builds credibility and
relationships.
Human Resources
As there are no other employees besides the owner, there is not much need for human resources.
However, when it comes time to expand, human resources will be a necessity. As the business
grows, there will be a need for another delivery person, and possibly an assistant baker as well.
When it comes time to hire employees, we will be looking for someone with previous experience
(for delivery) and someone who may not have previous experience, but is willing to learn (for
the assistant baker).
Compensation and Incentives
Once other employees are hired, they will be offered a 50% discount of all products, as well as
flexible scheduling. Employees will be paid a competitive hourly wage dependent on skills and
experience.

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Long-term Development
Three to Five Year Goals
My goals for the next 3-5 years are as follows:
Expand market reach to other areas of Vermont
Expand business from part-time operation to full-time
Expand into a different building
Expand customer base to include other areas outside of our starting target market of 15
miles.
Gather more recipes and expand the different food sensitivities I can cater to
Hire more staff
Purchase a delivery truck to be used for large orders
Risks and Adverse Results
The risks are great, as this is a very small business and it is just me running it. These risks
include:
Going under due to lack of funds. For larger orders the business will operate in a cashand-carry basis, where the customer must give a 50% deposit on the order. We will also
not be offering credit until the business has expanded to include retail outlets.
Not getting enough customers.
Failing to follow through on an order and gaining a bad reputation.
Being unable to grow fast enough to meet customer demands due to current equipment
and space restrictions.
Strategy for Achieving Goals
The goals the business has arent necessarily hard ones, but they will take a lot of effort and hard
work to achieve. Our strategy will be to take everything one day at a time, and to focus on the
things that can be controlled. By doing this, it will limit the stress on the owner, who will then be
able to better focus on the success of the business.

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Financials
Accounting System
The accounting system that the business will be using will be online, through a website such as
Wave Accounting, as it is free to use. The owner will be responsible for keeping the books. She
will make sure that are records are kept updated constantly, and will verify them at the end of
every month.
First Year Monthly Cash Flow

First Year Monthly Income Statement

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Yearly Income Statements for Years One, Three & Five

Years one through three, the business will be operating part-time, while the owner is studying at
culinary college and working during the summers at other jobs to help sustain herself and the
business. During this time she expects the average sales per month to increase from 20 to 60 with
each order averaging between $25-$50 as products evolve and become more complex, therefore
more expensive. Years three through five, the business will start transitioning into operating
full-time, after the owner graduates with a bachelors degree. During this time she expects the
average sales per month to increase from 60 to 75, with each order averaging $25-$75 as the
business grows. By the end of year five, the business hopes to be operating full-time, and be able
to sustain both the business and the owner solely off the profit made from the business.

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Supporting Documents
Works Cited
Bakeries. Hampton, Middlesex: Key Note, 2009. Bakeries Industry Snapshot. Center for
Economic Vitalities, June 2011. Web. 11 Mar. 2015.
"Baking Industry Economic Impact Study." American Bakers Association. American Bakers
Association, n.d. Web. 09 Mar. 2015.
Gregory, Janet. "Sales Methodology, Sales Process, Sales Guide or Sales Playbook."
(n.d.): n. pag. Sales Methodology, Sales Process, Sales Guide or Sales Playbook.
KickStart Alliance, Sept. 2010. Web. 03 Mar. 2015.
Xi, Timothea. "Bakery Industry Analysis." Small Business. N.p., n.d. Web. 10 Mar. 2015.
Bakeries: A Snapshot. Syracuse: Syracuse UP, 2011. Bakeries Industry Snapshot. Center for
Economic Vitalities, June 2011. Web. 03 Mar. 2015.
Shoukas, Denise. "Membership." Specialty Food Association. N.p., 5 Jan. 2014. Web. 27 Apr.
2015.
Watson, Elaine. SO Delicious: Dairy-free is One of the Biggest Growth Opportunities in the
Food Market Right Now. FoodNavigator-USA.com. Food Navigator USA, 10 July 2014. Web.
27 Apr. 2015.

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