FACULTY OF ENTREPRENEURSHIP AND BUSINESS

UNIVERSITI MALAYSIA KELANTAN

BACHELOR OF ENTREPRENEURSHIP
(RETAILING) (HONS)

SUBJECT:
FRANCHISING AND LICENSING (ARS 3063)

LECTURER:
DR. NURUL ASHYKIN BINTI ABD AZIZ

NAME STUDENT ID GROUP

EOH GUANG CHAN A18A0126 L1
KOH XUN YUN A18A0204 L1
LEE JIA JIA A18A0214 L1
LIM CHEW YUN A18A0230 L1
LIM MEI QI A18A0232 L1
LIM SHI YEN A18A0234 L1
LIM WEI CHUAN A18A0238 L1
NG WAI YEE A18A0415 L1
THANCHANOK SAE-CHEE A18A0918 L1
LO QI XIAN H18A0199 L1
TABLE OF CONTENT

No Contents Page Number

1 Introduction 1-2

2 Background of Company 3

3 Background of Franchisor / Owner 4-7

4 Background of Franchise Outlet 8 - 10

5 Organization / Management / Administration Plan 11 - 16

6 Marketing Plan / Analysis 17 - 20

7 Operational Plan / Production Strategy 21 - 27

8 Financial Plan / Strategy / Analysis 28 - 32

9 Conclusion 33

10 Reference 34
INTRODUCTION

Franchising can be defined as a form of marketing and distribution that involves the owner
(franchisor) to give the right to run a business that sells products or services to individuals
(franchisees) under the system created and designed by the franchisor. In this assignment,
we will choose a franchising concept business and provide further discussion on our
franchise business plan.

Name of the Company

For this assignment, our group is planning to set up a bakery shop as the franchise concept
business. The name of the bakery is called Tasty Bite Bakery. The reason of using Tasty
Bite as the name of bakery is because we believe that our products can leave a good image
to our customers. We hope that every bite on our products will always be the tasty one.

Nature of Business

The nature of business is the overall activities of a company in their quest to create, market
and sell products or services. It also can be viewed as the type of business within a
particular sector. Therefore, Tasty Bite Bakery involves in food and beverages industry
under the business sector. This is because Tasty Bite Bakery provide various products such
as breads, pies and cakes to our customers. Besides, Tasty Bite Bakery operates based on
profit earning motive. It means that the initial objective of the owner of Tasty Bite Bakery is to
make a profit out of his venture.

Industry Profile

Bakery industry in Malaysia is considered as a dynamic and fast moving industry. There are
several thousands of baked goods suppliers in Malaysia. They consist of stand-alone
smaller bakeries, commercial bakeries, home bakeries and food and beverages outlets that
have their own bakery production lines. Besides, the premium hotel also make their own
baked goods for their customers, events and conventions that are organized in the hotel.
The premium hotel also produce baked goods for sale in the coffee shops that are located in
the hotel lobbies.

The baked goods of Malaysia can be described as extremely versatile and come with
various choices, tastes and shapes with a fusion of different flavours and ingredients. The
baked goods are mostly came from various cultures in the country and it influenced by the
western style. The breads and buns in Malaysia are mostly soft and fluffy due to the
influences from Taiwan bakery and flour-confection trends. If compared to Europe countries,
their bread are mostly harder and more solid texture. However, the customers and the

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suppliers always ready to give new tastes a try, which leads to non-stop development of new
ideas and creations.

The bakery industry shows a positive trend and growth as the baked goods are being
consumed increasingly at either breakfast, tea time or even lunch. Furthermore, the western
cultures also influence the younger generations to acquire and accept bread or other baked
goods as a basic food.

Location of the Business

Choosing a right location for retail business is very important because it is also involves a
significant commitment of resource. Tasty Bite Bakery will be located at Kota Bharu,
Kelantan. Kota Bharu is considered as the administrative capital of the state of Kelantan. It
means that Tasty Bite Bakery will be located in a big city as big city consists of more people
from different backgrounds. Besides, Tasty Bite Bakery will be also located nearby the
neighbourhood area. When Tasty Bite Bakery is located in city area and nearby to
neighbourhood area, the customers such as residents nearby and employees from different
companies can visit our bakery due to convenience of location.

Factors in Selecting the Proposed Venture

There are many factors that trigger our group to start up a bakery business. One of the
reasons is food is a basic necessity that everybody will have to eat in daily life. By opening a
new bakery, we can provide a new choice to customers other than consuming foods that
consists of rice and noodle.

The second reason of venturing into bakery business is there is not much bakery that
runs in franchise concept if compared to fast food business. Hence, it can be a great
opportunity for Tasty Bite Bakery to start operate and gain popularity throughout the whole
Malaysia. We can absorb and increase the share market in bakery business so that we can
become the top ranking bakery in Malaysia.

2
BACKGROUND OF COMPANY

In this section, we will discuss and provide the information related to Tasty Bite Bakery.

Name of the Tasty Bite Bakery

Company
Address 3801, Jalan Hamzah, Bandar Kota Bharu, 15050 Kota Bharu,
Kelantan, Malaysia.
Telephone 09 – 876 5432
number / Fax
number
Email Address [email protected]
Form of Business Partnership Business
Main Business Sell a range of high quality baked goods such as breads, buns,
Activities cakes, pies and tarts
Date of 1 January 2020
Commencement
Number of 1234567-P
Registration
Date of Register on 15 December 2019
Registration
Logo of the
Business

3
BACKGROUND OF FRANCHISOR / OWNER

A franchisor refers to an individual that grants or sells a license to a franchisee from third
party in order to run the business using franchise concept. The overall rights and trademarks
belong to the franchisor and the franchisees are only allowed to use those rights and
trademarks after getting the permission from the franchisor through the franchise agreement.
Since the Tasty Bite Bakery wishes to operate using franchise concept, the owner of the
bakery will automatically become the franchisor of Tasty Bite Bakery.

Personal Particulars of Franchisor

Name Lo Qi Xian
I/C Number 980225-02-6065
Date of Birth 25 February 1998
Race Chinese
Religion Buddhism
Nationality Malaysia
Marital Status Single
Address 23F, Lorong 15, Taman Gurun Jaya, 08300 Gurun, Kedah
Contact Number 011-3616 3933
Email Address [email protected]
Highest Education Level Bachelor of Entrepreneurship (Retailing) from University
Malaysia Kelantan
Working Experience  Promoter for various brands in supermarkets and
hypermarkets
 Shop assistant in Starbucks Malaysia
 Office clerk in a Kedah’s company
Skills / Abilities  Basic knowledge on using computer
 Excellent written and verbal communication skill
 Able to adapt and learn in new environment

4
Partnership Agreement

A partnership agreement is used to reduce the possible conflicts and complexities among
partners in a business or a company. Hence, Tasty Bite Bakery will have its own partnership
agreement to avoid any misunderstanding from happening.

Details of partnership agreement:

This PARTNERSHIP AGREEMENT is made on 15 December 2019 between the following

individuals:

Lo Qi Xian Lim Wei Chuan Lee Jia Jia Lim Chew Yun Lim Shi Yen
Thanchanok Ng Wai Yee Koh Xun Yun Lim Mei Qi Eoh Guang
Sae-Chee Chan

1. Creation of Partnership
The parties hereby form a partnership under the name of Tasty Bite Bakery to
conduct a bakery Business. The principal office of the business shall be in 3801,
Jalan Hamzah, Bandar Kota Bharu, 15050 Kota Bharu, Kelantan.
2. Nature of Partnership Business
The partnership business will consists of the following business activity:
- Selling baked goods in the branches of Tasty Bite Bakery
3. Contributions to the Partnership
The capital contribution of each partner to the partnership shall consist of the
following property, services, or cash which each partner agrees to contribute:
Name of Partner Capital Agreed-Upon Percentage of
Contribution Cash share (%)
Lo Qi Xian 30,000 30,000 30
Lim Wei Chuan 10,000 10,000 10
Lim Mei Qi 10,000 10,000 10
Lim Shi Yen 10,000 10,000 10
Thanchanok Sae- 10,000 10,000 10
Chee
Ng Wai Yee 10,000 10,000 10
Koh Xun Yun 5,000 5,000 5
Lim Chew Yun 5,000 5,000 5
Eoh Guang Chan 5,000 5,000 5

5
 Lee Jia Jia 5,000 5,000 5

The partnership shall maintain a capital account record for each partner; should any
partner’s capital account fall below the agreed to amount, then that partner shall (1)
have his share of partnership profits then due and payable applied instead to his
capital account; and (2) pay any deficiency to the partnership if his share of
partnership profits is not yet due and payable or, if it is, his share is insufficient to
cancel the deficiency.

4. Profit and Loss Allocation

The profits and losses of the partnership shall be divided by the partners according to
a mutually agreeable schedule and at the end of each calendar year according to the
proportions as their contributions to the business as listed above.

5. Management of Partnership Business

The partners shall provide their full-time services and best efforts on behalf of the
partnership. No partner shall receive a salary for services rendered to the
partnership. The partners will have voting power when there is any decision making
process. However, if the partners cannot come to an agreement in any decision
making process, voting will be used to determine the final decision. The minority vote
should agree to the majority vote. Vote’s proportion is based on the contributions to
the business as listed above.
6. Term / Termination

The term of this Agreement shall be for a period of 4 years, unless the partners
mutually agree in writing to a shorter period. Should the partnership be terminated by
unanimous vote, the assets and cash of the partnership shall be used to pay all
creditors, with the remaining amounts to be distributed to the partners according to
their proportionate share.

7. Disputes
This Partnership Agreement shall be governed by the laws of the State of Malaysia.
Any disputes arising between the partners as a result of this Agreement shall be
settled by arbitration in accordance with the rules of the Malaysia Arbitration
Association and judgment upon the award rendered may be entered in any court
having jurisdiction thereof.
8. Withdrawal / Death of Partner

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 In the event a partner withdraws or retires from the partnership for any reason,
including death, the remaining partners may continue to operate the partnership
using the same name. A withdrawing partner shall be obligated to give sixty (60)
days’ prior written notice of his/her intention to withdraw or retire and shall be
obligated to sell his/her interest in the partnership. No partner shall transfer interest in
the partnership to any other party without the written consent of the remaining
partner(s). The remaining partner(s) shall pay the withdrawing or retiring partner, or
to the legal representative of the deceased or disabled partner, the value of his
interest in the partnership, or (a) the sum of his capital account, (b) any unpaid loans
due him, (c) his proportionate share of accrued net profits remaining undistributed in
his capital account, and (d) his interest in any prior agreed appreciation in the value
of the partnership property over its book value. No value for good will shall be
included in determining the value of the partner’s interest.
9. Non-Compete Agreement
A partner who retires or withdraws from the partnership shall not directly or indirectly
engage in a business which is or which would be competitive with the existing or then
anticipated business of the partnership for a period of three months.

IN WITHNESS WHEREOF, the partners have duly executed this Agreement on the day and
year set forth hereinabove.

qixian weichuan
Partner LO QI XIAN Partner LIM WEI CHUAN

jiajia shiyan
Partner LEE JIA JIA Partner LIM SHI YEN

meiqi weiyu
Partner LIM MEI QI Partner NG WAI YEE

Sae-chee chewyun
Partner THANCHANOK Partner LIM CHEW YUN
SAE-CHEE

xunyun guangchan
Partner KOH XUN YUN Partner EOH GUANG
CHAN

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BACKGROUND OF FRANCHISE OUTLET

As mentioned earlier, the Tasty Bite Bakery is originated in Kota Bahru, Kelantan. Since we
are planning to venture into franchising, we decide to expand our bakery business in other
cities of Kelantan after considering several factors such as population, economy, competitor
and demand. Therefore, the franchise outlets of Tasty Bite Bakery are planned to open in
Pengkalan Chepa and Kubang Kerian.

Outlet of Pengkalan Chepa:

Franchise Outlets Outlet of Pengkalan Chepa

Physical location Taman Bendahara, Jalan Pengkalan Chepa, 16100 Kota
Bahru, Kelantan
Price of premise - Rental fee is around RM4,500 per month
- Fee for a year is about RM54,000
Availability of manpower There is a university in the area of Pengkalan Chepa. The
university is called University Malaysia Kelantan (UMK) City
Campus. Besides, the population in Pengkalan Chepa is
considered normal which will not be hard for us to seek for
manpower. Based on this two benefits, we are able and easy
to get manpower from the residents nearby. Students from
UMK who are interested to work as a part-timer is another
manpower source for Tasty Bite Bakery.
Transportation facilities Transportation is very convenient in Pengkalan Chepa.
- There are public buses for the people to travel around
Kelantan. The company of the public bus is called City
Liner. People from different locations of Kelantan are able
to use City Liner’s buses to reach our outlet.
- There is an airport nearby. The distance between our
outlet and the airport is very short and it takes few
minutes for customers to reach.
- There is e-hailing services in Pengkalan Chepa as well.
People are free to use e-hailing services such as Grab,
Maxim and MyCar to reach our outlet.
- There is also a bus stop for buses which travel for long
distance. People will pass by our outlet when they go the
bus stop.
Distance from customers These are the few examples of the distance from customers

8
 to our outlet:
- The distance from Pantai Timor Hypermarket is about 0.1
km and it takes about 1 minute to reach.
- The distance from UMK City Campus is around 0.55 km
and it takes about 3 minutes to reach.
- The distance from McDonald’s Pengkalan Chepa is about
0.27 km and it takes about 2 minute to reach.
- The distance from bus stop is around 0.12 km and it
takes about 1 minute to reach.
- The distance from Sultan Ismail Petra Airport is around
4.1 km and it takes about 6 minutes to reach.
Basic amenities - Basic amenities in our outlet are electricity, water and
WiFi covered area.
- Basic amenities outside our outlet are roads, parking
spaces and a hypermarket nearby.
Reasons of choosing the - Pengkalan Chepa is considered a town area that has a lot
location of business districts and people.
- The UMK City Campus is just nearby.
- The facilities are complete in the location.

Outlet of Kubang Kerian:

Franchise Outlets Outlet of Kubang Kerian

Physical location Jalan Raja Perempuan Zainab 2, Bandar Baru, Kubang Kurian,
16150 Kota Bharu, Kelantan
Price of premise - Rental fee is around RM5,000 per month
- Fee for a year is about RM60,000
Availability of Kubang Kerian has higher population compared to Pengkalan
manpower Chepa. There is also a university nearby, which is called
University Sains Malaysia (USM). There are three health campus
in that university. Therefore, it is not difficult to look for manpower
from the residents and students.
Transportation The transportation facilities are likely the same as the facilities in
facilities Pengkalan Chepa expect there is no airport in the area of
Kubang Kerian.
Distance from These are the few examples of the distance from customers to
customers our outlet:

9
 - The distance from USM is about 0.5 km and it takes about 2
minute to reach.
- The distance from Mydin Wholesale Hypermarket is around
0.26 km and it takes about 2 minutes to reach.
- The distance from Subway is about 0.1 km and it takes about
1 minute to reach.
- The distance from night market of Kubang Kerian is around
0.7 km and it takes about 2 minute to reach.
- The distance from Mini Terminal Transnasional Kubang
Kerian is around 1.1 km and it takes about 4 minutes to
reach.
Basic amenities - Basic amenities in our outlet are electricity, water and WiFi
covered area.
- Basic amenities outside our outlet are roads, parking spaces
and a hypermarket nearby.
Reasons of choosing - Higher population which helps to contribute the chance of
the location people to visit our bakery.
- The USM is just around the corner so we can target our
customers from students from USM.
- The basic facilities are complete.

10
ORGANIZATION / MANAGEMENT / ADMINISTRATION PLAN

In this section, we will talk about the organization, management and administration plan of
Tasty Bite Bakery.

Organization’s Mission, Vision and Objective

 Mission

The mission of Tasty Bite Bakery is to provide the best quality of baked products to
our customers. For every baked products in Tasty Bite Bakery, we will use fresh and
high quality ingredients to ensure the taste of our products is always maintaining at
excellent level. The best quality of products is important to achieve the best customer
experience. Besides, every baked product such as breads, buns, pies, cakes and
tarts carries and represents the reputation of Tasty Bite Bakery. Therefore, Tasty Bite
Bakery will always emphasize on the quality of our products.

 Vision
The vision of Tasty Bite Bakery is to become a nation premier company in the baking
industry. In another words, Tasty Bite Bakery wishes to become the best and the top
company in bakery industry. We will not only provide the best products but also
provide the most outstanding customer service to fulfil the customers’ satisfaction.
Once we are able to provide high quality products and gain support from customers,
we believe our brand will be able to compete in both local and global market.
 Objective
a) To share our products with customers
Tasty Bite Bakery want to share our baked products with our customers who are
willing to pay a visit to our outlet and purchase our products. It is a must to share
our products with our customers because Tasty Bite Bakery provides the freshest
and the best quality baked products to our customers.
b) To contribute to our people
Tasty Bite Bakery creates job opportunities to fellow Malaysians and we are
always ready to hire Malaysians as our staffs. As a local bakery in Malaysia, we
hope that our bakery can contribute to the nation even it is just a tiny contribution.
c) To become the world-leading bakery
We believe we can promote and expand our business to international level based
on our concept and the quality of our products. We will always seek for
opportunities to expand our business and bring prosperity to the people all over
the world.

11
Organizational Chart / Structure

The chart below represents the organizational chart of Tasty Bite Bakery.

OWNERS AND OTHER

PARTNERS

GENERAL MANAGER ASSISTANT

OPERATION ADMINISTRATION FINANCIAL

EXECUTIVE MARKETING EXECUTIVE
EXECUTIVE EXECUTIVE

ASSISTANT ASSISTANT ASSISTANT ASSISTANT

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Human Resources Planning

The partners of Tasty Bite Bakery will not taking part in managing the business functions.
Hence, the partners will not receive any salary. Since the partners of Tasty Bite Bakery is not
involving in managing the business functions, we will hire and recruit a professional team to
manage all the financial, marketing, operational and administrative department. The table
blow shows the list of administrative personnel in Tasty Bite Bakery.

Position No. of Personnel

General Manager 1
Assistant General Manager 1
Operation Executive 1
Assistant Operation Executive 1
Administration Executive 1
Assistant Administration Executive 1
Marketing Executive 1
Assistant Marketing Executive 1
Financial Executive 1
Assistant Financial Executive 1
Total 10

Each position will have different roles, tasks, responsibilities and job description. The table
below describes the responsibilities and job description for each position in Tasty Bite
Bakery.

Position Task and Responsibilities

General Manager  Responsibilities in managing the company vision, mission
and the objective
 To always identify and plan the business objective,
highlight the regulations and the business procedure in
order to achieve the goal
 Provide a direction for the organization. Board of director
have personal strategic function in providing vision and
mission to the organization.
 Monitor and control all the function.
Operation Executive  To communicate with upper management to develop
strategic operations goals
 Developing strategic long term plans to achieve goals
 Monitoring operational performance

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  Monitoring construction and renovation projects
 Monitoring performance metrics
Administration  To make sure the systematically of the management
Executive system
 Developing and implementing strategies and plans for
growth of the business
 Controlling and handling salary of the staff
 Hiring new employees to work
 Generating all the report from all the director and gives
presentations to president and board of director.
 Trains low-level managers and also staff
 Oversees daily business operations

Marketing Executive  Develop new marketing strategies to promote the product

 Manage all the sales by developing a business plan that
covers all the elements such as sales, revenue and
expense controls.
 Setting the individual and group sales targets with the
current sales team
 Coordinating with marketing and cope with the market
environment to increase sales
 Understand the customer and always getting feedback from
them after they use our products.
 Developing sales team through motivation, counselling and
dedication.
Financial Executive  Train new accounting staff
 Managing all the internal controls
 Analyzing all the financial data
 Manage and oversee the tax functions and audit
 Analyzing and direct the financial planning and strategy
 Always reviewing in the department budgets
 Preparing annual account and advisor in the financial
aspects
 Using effective and efficient ways to increase profit and
sales

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Schedule of Remuneration inclusive EPF and SOCSO Contributions

Position Quantity Monthly EPF paid by EPF SOCSO EIS Total amount of Total amount of salary
Salary (RM) company – deducted deducted 0.2% paid by salary received paid by company (RM)
13% (RM) from salary – from salary company and (RM)
11% (RM) – 2% (RM) 0.2%
deducted
from salary
(RM)
General 1 2,500 325 275 50 5 2,170 2830
Manager

Administration 1 1,800 234 198 36 3.6 1,562.40 2,037.60

Executive

Financial 1 1,800 234 198 36 3.6 1,562.40 2,037.60

Executive

Operational 1 1,800 234 198 36 3.6 1,562.40 2,037.60

Executive

Marketing 1 1,800 234 198 36 3.6 1,562.40 2,037.60

Executive

Assistant 5 1,500 195 165 30 3 1,302 1,698

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List of Office Equipment and Supplies

Item Quantity Price per unit (RM) Total (RM)

Chair 12 150 1,800

Sofa 2 1,600 3,200

Printer 3 180 540

Projector screen 1 149 149

Computer 11 2,000 22,000

Fax machine 2 250 500

Office Table 7 1,200 8,400

Wall clock 3 15 45

Shelf 4 180 720

Air Conditioner 4 800 3,200

Telephone 5 100 500

TOTAL 41,054

Administration Budget

Item Fixed Asset Monthly Expense Other Expense

(RM) (RM)
Office Equipment 41,054
Maintenance 2,000
Office rental 3,500
Utilities 800
Internet 300
Stationeries 300
Licence 250
SUBTOTAL 41,054 6,600 550
TOTAL AMOUNT 48, 204

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MARKETING PLAN / ANALYSIS

In this section, we will talk about the marketing plan and make marketing analysis for Tasty
Bite Bakery.

Description of products

Products can be defined as the most important element for a business to operate. Different
quality of products can influence a business level on the future. This is because a good
product may create a good first impression to the customer and fulfil their satisfaction as well
as increase the frequency of visit. In Tasty Bite Bakery, our main products are baked goods.
Baked goods refer to foods that are made from a dough or batter that is baked. We provide
baked goods such as breads, bars, cakes, tarts and muffins.

a) Breads
We provide different breads such as bagels, buns, rolls and loaf breads in Tasty Bite
Bakery. We provide different flavour and taste in our breads. For instance, we have
cheese bun, curry bun, chicken salad bun, Mexico bun, whole wheat loaf, sweet
potato bun, black pepper flavoured bun and many others. Besides, we also have fruit
flavours for our bread products.
b) Bars
We provide different types of bar in our outlet such as brown butter maple pecan
bars, banana bread bars, chocolate bread bars and many others.
c) Cakes
We have different kinds of cake as well in our outlet. We have ice cream cake,
pandan cake, chocolate flavoured cake, coffee flavoured cake, fruit cake and a lot
more choices of cake.
d) Tarts
We provide tarts such as egg tart, almond tart, fruit tart and others in Tasty Bite
Bakery.
e) Muffins
We have muffins for different flavoured as well such as chocolate muffin, coffee
muffin and dark chocolate muffin.
f) Cookies
We have prepared various flavours and types to our customers. For example, there
are peppermint chocolate shortbread cookies, trail mix cookies, thin mints, frosted
pecan pumpkin spice cookies, caramel chocolate chip cookies and milk chocolate
dipped blueberry shortbread cookies.
d) Others

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We have pancakes, waffles, French toast and sandwiches in our outlet as well.

18
Target Market

Target market represents a group of customers that are potential for a company or an
organization to sell its products or services to. For Tasty Bite Bakery, our target market will
be most of the people who stay nearby our outlets. This is because food is a basic necessity
which everybody has to consume everyday in daily lives. Baked products can be a source of
food and be another choice for the people to choose for.

However, the outlet of Tasty Bite Bakery will be operated in crowded areas since
there are more people in these areas. For example, city areas consist of people such as
residents, employees and students. These people are the potential customers as they need
to consume food to acquire energy to carry out daily activities.

Furthermore, our Tasty Bite Bakery also can be the choice for those people who are
aware and conscious about healthy lifestyle. Our products always use fresh and high quality
ingredients. We also put some initiative to provide healthy baked products which is low in
calories and rich in vitamins, minerals and fibre. For example, we have whole grains bread
and whole wheat bread for customers who want to have a healthy lifestyle.

Market Size

Market size refers to the total number of potential purchase from target market which
includes the purchases of competitor’s product within the same target market. For example,
the population in Kota Bharu can be the approximate figure of our market size. According to
the data of population in Kota Bharu, Kelatan in 2019, there are 1.89 million populations
(0.93 million are male and 0.95 million are female). Therefore, our market size will be around
1.89 million.

Competitors

Competitor can be defined as a company or a person that carry out a business in the same
industry or similar industry which offer similar products or services. There are various
bakeries in Kota Bharu such as Muhibah Bakery, Cintaku Pastry House, Huzaifah Bakery
and many other bakeries. All these bakeries are the competitors for Tasty Bite Bakery.

These competitors provide various types of baked goods to the people. This will
influence and affect the business of Tasty Bite Bakery since every bakery has their own
uniqueness on their products. These competitors will have their own signature product to
attract the customers to visit them.

19
 Besides, these competitors also have their own loyal customers. They have been
operated for a certain period and they will have own customer groups that will visit their
bakery stores frequently.

Lastly, these competitors also use social media to promote their products which will
affect the business of Tasty Bite Bakery. They use social media such as Facebook and
Instagram to promote their business and gain popularity. Some of the competitors even have
their own website for publicity purpose.

Market Share

Market share is a measure of consumer preference for a certain product over other similar
products. A higher market share usually means greater sales, lesser effort to sell more and a
strong barrier to entry for other competitors. There are several bakeries in Kota Bharu such
as Muhibah Bakery, Shaffaat Cake and Café, Cintaku Pastry House, Huzaifah Bakery and
many other bakery businesses. Therefore, the market share of Tasty Bite Bakery is based
on the total sales generated after competing with these competitors.

Sales Forecasts

Estimated Average price per Total sales (RM)

production unit (RM)
Breads 30,000 units 3 90,000

Bars 10,000 units 3 30,000

Cakes 5,000 slices 6 30,000

100 whole cakes (1kg) 35 3,500
Cookies 3,000 packets 8 24,000

Muffins 8,000 units 3 24,000

Tarts 8,000 units 3 24,000

Others 8,000 units 5 40,000

TOTAL SALES 265,000

The table above show the total sales estimated for one month is around RM265,000. Hence,
the total sales estimated for one year is around RM3,180,000.

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Marketing Strategy

Marketing strategies are important for Tasty Bite Bakery to capture the attention of our target
market and gain popularity as well as sales among the public. Therefore, we will have
several marketing strategies for Tasty Bite Bakery.

a) Providing discount to specific people

Tasty Bite Bakery will provide 5% discount for special people such as students and
senior citizens. Customers have to bring the proof to prove that they are senior
citizens or students in order to enjoy the discount. The senior citizens and students
are entitled to enjoy this discount whenever they visit our bakery. This is to show our
appreciation to them and can help to boost the sales.
b) Organizing promotions for special events
Tasty Bite Bakery will organize various promotions during any festivals or special
events. Promotions can be in the form of discounts or free gifts. For example, during
Mother’s Day and Father’s Day, Tasty Bite Bakery will organize special promotions
for customers who purchase cakes from our bakery. Customers are entitled to get a
slice of cake for free if they purchase a whole cake from Tasty Bite Bakery.
c) Providing free and good looking packaging
For customers who purchase our products, they are able to get free and good looking
packaging from Tasty Bite Bakery. For the cake and cookies products, we will
prepare boxes with attractive design for customers. This is because normally people
will buy cakes and cookies to give to other people as a present. Therefore, the
appearance of packaging is important. Once we have good looking packaging, this
will be a pull factor for Tasty Bite Bakery to attract more customers.
d) Using social media
Social media has become a great weapon for people to promote their business.
Tasty Bite Business will set up our own social media such as Facebook and
Instagram to promote our bakery. We will upload the latest information and on-going
promotion on social media to keep updated our customers. Posting with attractive
design and useful information will help us to attract more customers and generate
more revenues.

21
OPERATIONAL PLAN / PRODUCTION STRATEGY

In this section, we will discuss about the operational plan and production strategy used by
Tasty Bite Bakery.

Operational / Innovation Process

There are eight operational processes in Tasty Bite Bakery.

a) Renovation
The first operation is to renovate the shops that we have rented to start up our Tasty
Bite Bakery business. The environment and ambience of store is important to ensure
everyone who step in our bakery can feel comfortable.
b) Purchase furniture appliances
We will purchase some furniture such as tables, chairs, shelves and tray for
customers and for displaying our baked goods properly.
c) Purchase equipment
Tasty Bite Bakery requires a lot of equipment such as oven, mixer, toaster and other
equipment needed for preparing and baking purposes. We need these equipment to
make products such as breads, tarts, muffins and cakes to our customers. Besides,
we will also buy equipment for making payment, which are all in one retail shop POS
system and credit card terminal merchant machine.
d) Purchase ingredients
In this process, we will buy ingredients or order ingredients from suppliers to make
products for customers. Ingredients such as flour, eggs, cream, milk and other
material are required to make breads and other baked goods to customers.
e) Make baked products
After purchasing the baking ingredients, the bakers of Tasty Bite Bakery can start to
produce breads, tarts, muffins, cookies, bars and cakes.
f) Sell products to customers
The baked goods are ready to be displayed on shelves and ready to sell to
customers.
g) Calculate profit of the day
The cashiers will calculate the revenue and profit for everyday when the Tasty Bite
Bakery outlet closes after business hours. The cashiers are required to record the
revenue and profit as a proof for future reference.
h) Clean and sanitise

22
 When the outlet of Tasty Bite Bakery closes after business hours, our staffs will clean
and sanitise the bakery and clean the kitchen area as well to make sure we always
maintain the standard of cleanliness in Tasty Bite Bakery.

Process Flow Chart

This is the process flow chart of Tasty Bite Bakery:

Renovation Clean and sanitise

Calculate profit of
Purchase furniture
the day

Sell products to
Purchase equipment
customers

Make baked
Purchase ingredients
products

Production Schedule / Capacity Planning-output in units

Day / Time 8am 9am 10am 12pm 2pm

Monday Breads and Bars, tarts Cakes Topping up Cookies
others and muffins
Tuesday Breads and Bars, tarts Cakes Topping up
others and muffins
Wednesday Breads and Bars, tarts Cakes Topping up
others and muffins
Thursday Breads and Bars, tarts Cakes Topping up
others and muffins
Friday Breads and Bars, tarts Cakes Topping up Cookies
others and muffins
Saturday Breads and Bars, tarts Cakes Topping up
others and muffins

23
 Sunday Breads and Bars, tarts Cakes Topping up
others and muffins
The schedule above illustrates the estimated time for the bakers of Tasty Bite Bakery to
produce the baked goods. The bakers will have fixed schedule every day from 8am to 2pm.
In the daily routine, the bakers have to start making breads and other products such as
sandwiches, pancakes, French toasts and waffles starting from 8am. After that, they have to
start making bars, tarts and muffins at 9am. Then, they have to make cakes for sale and
cakes that customers have requested starting from 10am. During 12pm, the bakers have to
see products that left a few only for sale and start making the products to top up in the
bakery. However, only on Monday and Friday, the bakers are required to make cookies.

Estimated
production
Breads 30,000 units

Bars 10,000 units

Cakes 5,000 slices

100 whole cakes (1kg)
Cookies 3,000 packets

Muffins 8,000 units

Tarts 8,000 units

Others 8,000 units

The table above shows the estimated output for every month.

Material Required

The list of materials required:

Flour  All-purpose flour

 Bread flour
 Cake flour
 Whole wheat flour
 White whole wheat flour
 Cornmeal
 Non-wheat flour
Leaveners  Baking soda

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  Baking powder
 Yeast
 Gluten
Sugars  Granulated sugar
 Brown sugar
 Powdered sugar
Sweeteners  Honey
 Molasses
 Maple syrup
 Decorator/Coarse Sugar
Dairy  Unsalted butter
 Salted butter
 Cream cheese
 Evaporated milk
 Sour cream
Extracts and flavourings  Vanilla extract
 Mint extract
 Chocolate extract
Spices  Cinnamon
 Cloves
 Nutmeg
Extra ingredients  Chocolate chips
 Chocolate bars
 Cocoa powder
 Dried fruits
 Nuts
 Jams
 Sprinkles
 Food colouring

Machine and Equipment Requirement

The list of machine and equipment needed:

25
 Machine and Equipment
Gas baking oven
Electrical baking oven
Mixer
Dough divider
Cooling rack
Toaster
All in one retail shop POS system
Credit card terminal merchant
machine
Operation Layout Plan

This is the layout plan in Tasty Bite Bakery:

26
Location of Operations

Most of operations will be carried out at the baking area. Baking area is the place where
Tasty Bite Bakery will store its ingredients and ready for use. The bakers of Tasty Bite
Bakery will also make baked goods in this area. After finish making baked goods, it will be
send to store area and arranged nicely on shelves and in the fridge. The breads, tarts,
muffins, cookies, bars and others will be displayed on shelves whereas the cakes will be
displayed in the fridge. Payments will be made in the counter area after customers have
finished selecting the products and ready to pay for them. The back entrance is prepared for
suppliers to deliver the goods to our outlet.

Operational Overhead

The only operation overhead in Tasty Bite Bakery is the rental of the shop. The monthly
rental of the location for the use of operations and business is about RM6,000 per month.

Operational Budget

This is the estimated number of manpower required for completing the operational process
in Tasty Bite Bakery.

Position Quantity Salary TOTAL

(RM) (RM)

Bakers 10 1,300 1300 x 10 = 13,000

General staff 3 1,200 3,600

TOTAL 16,600

This is the expected costs to purchase the machine and equipment.

Machine / Equipment Quantity Price TOTAL

(RM) (RM)
All in one retail shop POS system 1 5,000 5,000

Credit card terminal merchant machine 1 800 800

Shelves 10 300 3,000

Tray 20 10 200

Kitchen equipment - 30,000 30,000

27
 TOTAL 39,000

28
The total operation budget is stated as below.

Item Amount (RM)

Operational overhead 6,000
Manpower salary 16,600
Machine and equipment 39,000
TOTAL 61,600

29
FINANCIAL PLAN

In this section, we will display our financial plan of Tasty Bite Bakery.

Project Implementation Cost (For one year)

The total of capital is RM 158,907. In this capital, there are RM 58,907 are the loan from
bank. While RM 100,000 is the investment of shareholder.

Project Implementation Cost Source of Finance

RM Own Contribution (Cash)

Fixed Assets

Kitchen Equipment 41,054 41,054

Working Capital (1 month):

Administrative 55,757 55,757

Marketing 6,000 10,000

Operations 20,000 60,600

Pre-operations & Other Expenditure 21,650 21,650

Contingencies (10%) 14,446 14,446

TOTAL 158,907 158,907

Table of Depreciation

Depreciation of Stove Oven Microwave Blender

asset

Purchase date 25/02/18 11/03/18 11/03/18 23/04/18

Cost (RM) 2,430 3,500 2,200 680

Life 2 years 2 years 2 years 2 years

Depreciation Straight-line Straight-line Straight-line Straight-line

method (10%) (10%) (10%) (10%)

Current year 243 350 220 68

depreciation (RM)

Net book Value 2,187 3,150 1,980 612

(RM)

30
 Month Beginning Ending Monthly Total Principal Total principal Interest paid Total interest
balance (RM) balance payment paid (RM) paid paid (RM) (RM) paid (RM)
(RM) (RM) (RM)

1 58,907 53,701.54 5,500.00 5,500.00 5,205.47 5,205.47 294.535 294.535

2 53,701.54 48,470.04 5,500.00 11,000.00 5,231.49 10,436.96 268.51 563.04
3 48,470.04 43,212.39 5,500.00 16,500.00 5,257.65 15,694.61 242.35 805.39
4 43,212.39 37,928.45 5,500.00 22,000.00 5,283.94 20,978.55 216.06 1021.45
5 37,928.45 32,618.10 5,500.00 27,500.00 5,310.36 26,288.90 189.64 1211.10
6 32,618.10 27,281.19 5,500.00 33,000.00 5,336.91 31,625.81 163.09 1374.19
7 27,281.19 21,917.59 5,500.00 38,500.00 5,363.59 36,989.41 136.41 1510.59
8 21,917.59 16,527.18 5,500.00 44,000.00 5,390.41 42,379.82 109.59 1620.18
9 16,527.18 11,109.82 5,500.00 49,500.00 5,417.36 47,797.18 82.64 1702.82
10 11,109.82 5,665.37 5,500.00 55,000.00 5,444.45 53,241.63 55.55 1758.37
11 5,665.37 193.69 5,500.00 60,500.00 5,471.67 58,713.31 28.33 1786.69
12 193.69 - 5,500.00 66,000.00 5,499.03 64,212.34 0.97 1787.66

Loan amortization schedule/ Hire-purchase repayment schedule

29
 Pre-
Total
Month Opera 1 2 3 4 5 6 7 8 9 10 11 12
Year 1
-tions
CASH INFLOW                              
158,90
Capital (Cash) 7
158,907
265,00 265,00 265,00 265,00 265,00 265,00 265,000 265,000 265,000 265,000 265,00 265,00 3,180,00
Cash Sales 0 0 0 0 0 0 0 0 0
158,90 265,00 265,00 265,00 265,00 265,00 265,00 265,000 265,000 265,000 265,000 265,00 265,00 3,338,90
TOTAL CASH INFLOW 7 0 0 0 0 0 0 0 0 7
CASH OUTFLOW
Administrative
Expenditure
Salaries, EPF & SOCSO 12,679 12,679 12,679 12,679 12,679 12,679 12,679 12,679 12,679 12,679 12,679 12,679 152,148
Store rent 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 144,000
Store supplies 8,000 8,000 8,000 8,000 8,000 8,000 8,000 8,000 8,000 8,000 8,000 8,000 96,000
Store utilities 10,745 10,745 10,745 10,745 10,745 10,745 10,745 10,745 10,745 10,745 10,745 10,745 128,940
Store maintenance 12,333 12,333 12,333 12,333 12,333 12,333 12,333 12,333 12,333 12,333 12,333 12,333 147,996
Marketing Expenditure
Promotion & Advertising 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 120,000
Operations Expenditure
Cash purchase 55,600 55,600 55,600 55,600 55,600 55,600 55,600 55,600 55,600 55,600 55,600 55,600 667,200
Carriage inward and duty 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 60,000
Other Expenditure
Deposit 2,000 2,000
Franchise Registration &
19,650 19,650
License
Purchase of fixed assets 41,054 41,054
TOTAL CASH 126,35 126,35 126,35 126,35 126,35 126,35 126,357 126,357 126,357 126,357 126,35 126,35 1,578,98
62,704 7 7 7 7 7 7 7
OUTFLOW 7 8
ENDING CASH 234,84 373,48 512,13 650,77 789,41 928,06 1,066,70 1,205,34 1,343,99 1,482,63 1,621,27 1,759,91
96,203
BALANCE 6 9 2 5 8 1 4 7 0 3 6 9

Pro Forma Cash Flow Statement

30
Cash Flow Pro Forma Statement

 
Cash Flow Pro Forma Statement 
 
  Year 1 Year 2 Year 3
CASH INFLOW      
Capital (Cash) 158,907    
Cash Sales 2,000,000 2,100,000 2,200,000
TOTAL CASH INFLOW 2,158,907 2,100,000 2,200,000
CASH OUTFLOW      
Administrative Expenditure
Salaries, EPF & SOCSO 152,148 152,148 152,148
Store rent 144,000 144,000 144,000
Store supplies 96,000 96,000 96,000
Store utilities 128,940 128,940 128,940
Store maintenance 147,996 147,996 147,996
Marketing Expenditure
Promotions & Advertisement 120,000 120,000 120,000
Operations Expenditure
Cash purchase 667,200 667,200 667,200
Carriage inward and duty 60,000 60,000 60,000
Other Expenditure
Deposit 2,000
Franchise registration & license 19,650
Purchased of fixed assets 41,054
TOTAL CASH OUTFLOW 1,578,988 1,516,284 1,516,284
CASH SURPLUS (DEFICIT) 579,919 583,716 683,716
BEGINNING CASH BALANCE - 579,919 1,163,635
ENDING CASH BALANCE 579,919 1,163,635 1,847,351

31
Pro Forma Profit and Loss Statement

Pro Forma Income Statement

  Year 1 Year 2 Year 3
Sales 2,000,000 2,100,000 2,200,000
Less: Cost of Sales
Opening stock of finished goods 36,000 36,000
Cash purchase 667,200 667,200 667,200
Less: Ending stock of finished goods 36,000 36,000 36,000
631,200 667,200 667,200
Gross Profit 1,368,800 1,432,800 1,532,800
Less: Expenditure
Administrative expenditure 669,084 669,084 669,084
Marketing expenditure 120,000 120,000 120,000
Carriage inward and duty 60,000 60,000 60,000
Depreciation of kitchen equipment 881 881 881
Franchise registration & license 19,650 - -
Total expenditure 869,615 849,965 849,965
Accumulated Net Profit 499,185 582,835 682,835

Pro Forma Balance Sheet

Pro-Forma Balance Sheet

  Year 1 Year 2 Year 3
Assets
Fixed Assets (Book Value)
Kitchen equipment 40,173 39,292 38,411
Current Assets
Stock of finished goods 36,000 36,000 36,000
Cash balance 579,919 1,163,635 1,847,351
Other Assets
Deposit 2,000 2,000 2,000
TOTAL ASSETS 658,092 1,240,927 1,923,762
Owner’s Equity
Capital 158,907 658,092 1,240,927
Accumulated Net Profit 499,185 582,835 682,835
TOTAL LIABILITY AND EQUITY 658,092 1,240,927 1,923,76

32
 2
CONCLUSION

The franchise business plan that our group set up a bakery shop as a franchising concept
business. Our bakery is called Tasty Bite Bakery. Franchise business plan is important is to
make their plan work, a considerably more careful methodology should be embraced. A
business plan is a useful tools to help assemble contemplations and to set targets for the
business. The franchise business plan also helps the owner to understand their current
situation and lead them to be focus towards the company goal, mission and vision. The
franchise also records financial status well, so the owners, the financial executive and
financial assistant are easier on managing company financial and owner or general manager
will able to figure the next step the company should run to meet the company vision and
mission.

The franchise outlets of Tasty Bite Bakery are located at Pengkalan Chepa and
Kubang Kerian. The franchise business plan manages to help Tasty Bite Bakery to
understand and focus on their mission and vision which lead the owner and his team to
provide customer with the quality of baked goods and to become a nation premier company
in the bakery industry.

Besides, the franchise business plan needs discussion and view from all the plan
especially financial plan, marketing plan and operational plan. This is because these three
plans are required to provide their all information and steps for the company to create the
accurate the franchise business plan. Therefore, the whole company is able to understand
status clearly and face all the problem and solve the problem efficiently.

In the nutshell, the franchise business plan brings benefits to the company to achieve
their goals, vision and mission. The franchise business plan is also very useful and helpful to
the owners and get more franchisees.

33
REFERENCES

1. Prachi. M. (2018, September 22). Business. Retrieved from

https://theinvestorsbook.com/business.html
2. What Is the Nature of Business? (2020, July 14). Reference. Retrieved from
https://www.reference.com/business-finance/nature-business-372673bbec5000ed
3. Bakery & Flour Confectionary Trends in Malaysia. (2016). Malaysia-German
Chamber of Commerce and Industry (MGCC). Retrieved from
https://businessmalaysia.eu/admin/js/fileman/Uploads/1.bakery%20and%20flour-
%20confectionary%20trends%20in%20malaysia_2016.pdf
4. Horton. M. (2020, February 8). Which terms should be included in a partnership
agreement? Retrieved from
https://www.investopedia.com/ask/answers/041015/which-terms-should-be-included-
partnership-agreement.asp
5. Kenton. W. (2020, July 19). Target Market. Retrieved from
https://www.investopedia.com/terms/t/target-market.asp#:~:text=A%20target
%20market%20refers%20to,for%20a%20good%20or%20service.

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