ENT300

BUSINESS PLAN
THE BAKING FAIRY

Prepared by:

NAME STUDENT ID CLASS

NOOR HASANAH BT SAMIJAN 2014887778 JBM1115B
NUR ATIKAH BT AZHAR 2014693538 JBM1115B
MARIAH BT MOHD ARSHAD 2014496688 JBM1115B
KHALID ALWALID B KHAIRUDIN 2014421684 JBM1115B
NIK NORAFRINA BT NIK MOHAMAD JBM1115B
2014628298
ANUAR
ERMAWATI BT MAD DAUD@AJAMAIN 2014470714 JBM1115B

Prepared for:

MDM NOR’AZURAH BT KAMDARI

Submission date:

21 SEPTEMBER 2016
 TABLE OF CONTENTS

No. Contents Page

1. Letter of submission 3
2. Acknowledgement 4
3. Introduction 5
4. Purpose of business plan 13
5. Company’s Background 15
6. Partner’s Background 20
7. Partnership Agreement 28
8. Administration 34
 Introduction 35
 Objectives 36
 Organizational chart 38
 Task and responsibilities 40
 Schedule and remuneration 42
 Worker properties 43
 Office location 44
 Office layout 45
 Office equipment 46
 Office stationary 46
 Administration Budget 49
9. Marketing 51
 Marketing objective 52
 Production description 53
 Target market 55
 Market size 56
 Competitors 59
 Market share 60
 Sales forecast 61
 Market Strategies 64
 Organizational chart 67
 Manpower Planning 68
 Schedule of task and responsibilities 69
 Schedule of remuneration 70
 Marketing budget 71
10. 72
Operational
 Introduction 73
 Process planning for manufacturing 75
 Operation Layout 78
 Production planning 79
 Machine and equipment planning 84
 Manpower Planning 89
 Overhead requirement 92
  Total operational cost 93
 Cost per unit 94
 Productivity index 95
 Location Plan 96
 Business and operating hours 97
 License, permits and regulations required 98
 Operational budget 100
Financial 101
 Administrative budget 102
 Marketing Budget 104
 Operational budget 105
 Capital expenditure projection 106
 Pre-operating and working capital 107
 Sales and purchases projections 108
 New project implementation cost 109
 Sources of new project financing 110
 Pro-forma Balance sheet 111
 Pro-forma income statement 112
 Cash flow statement 113
 Pro-forma cash flow 114
 Liquidity ratio 115
 Profitability ratio 116
 Efficiency ratio 117
 Financial ratio 118
 Annual sales 119
 Annual income 120
 Year-end financial 121
 Financial performances 122
11. Conclusion 123
 1.1 LETTER OF SUBMISSION

Diploma in Business Studies,,

Universiti teknologi Mara (Johor Branch, Segamat Campus),
KM12 Jalan Muar,
85009 Segamat,
Johor Darul Takzim.

Madam Nor’Azurah bt Kamdari,

Lecturer of ENT 300,
Universiti Teknologi MARA (Johor Branch, Segamat Campus),
KM 12, Jalan Muar,
85009 Segamat,
Johor Darul Takzim. 2 SEPTEMBER 2016

Mdm,,

SUBMISSION OF BUSINESS PLAN PROPOSAL ENT300

Allude to the subject stated above; we would like to submit the proposal of our final project paper
for ENT300 subject.

2. This business plan was completed according to the guidelines and requirements given
according to the related subject. This business plan is build up to serve as a guide and prototype
for a business proposed deal which covers the top management which is started from general
manager followed by the administration, marketing, operation, and financial aspects.

3. We hope that our business plan that we recommended does fulfil your obligations. If there are
any errors or lack in any part are fully depends on us. Plus, we appreciate any comments or
remarks on our project in order to help us to improve.

4. Thank you for your guidance and time to go through our business plan and analyse it. With all
our efforts we hope that you will approve this business plan that we produced. Finally, we hope
that the cooperation that arises among us can enhance a good collaboration.

Yours sincerely,

_________________________

(KHALID ALWALID B KHAIRUDIN)

General Manager,
The Baking Fairy
 1.2 ACKNOWLEDMENT

In the name of Allah, the Most Gracious and the Most Merciful, Alhamdulillah, all praises to
Allah for the strengths and His blessing upon completing this project report. This project report
was prepared for subject Fundamental of Entrepreneurship (ENT300).

We would like to give our special thanks to our lecturer Madam Nor’Azurah bt Kamdari for
her supervision , support and her invaluable help of constructive comments and suggestions
throughout the project, which have contributed to the success of this project.

We would like to thank to our parents for being very supportive in completing this project.
We also would like to thank our classmates from JBM1115B for being cooperated and honestly
sharing ideas among classmates which gave us more motivation and inspiration to complete our
task greatly.

Last but not least, we would like to say thank you to our group partners, Noor Hasanah bt
Samijan, Nur Atikah bt Azhar, Mariah bt Mohd Arshad, Khalid Alwalid b Khairudin, Nik Norafrina bt
Nik Mohamad Anuar and Ermawati bt Mad Daud@Ajamain who contributed a lot for this project. It
is a blessing to have their constant support and help. Without their cooperation and guidance, this
project would not have been materialized.
 1.1 BUSINESS SUMMARY

The Baking Fairy is a specialized company in producing glowing cupcakes. The Baking
Fairy opened its door in 1st November 2013 and is located at Lot LS21, Jalan Akuatik 13/64,
Persiaran Akuatik, 40200, Shah Alam, Selangor Darul Ehsan.

The Baking Fairy strives for the baking treats that tasted as good as they looked. Out of
this, came the unfussy, elegant, yet pretty cupcakes which do not disappoint taste buds. What
differentiates our cupcakes from the rest is that our cupcakes glow! How exciting is that!

Centralising the baking to our production kitchen ensures that each cupcake is baked
under close supervision of pastry chef who takes great pride in his trade. In our kitchen, we do not
take short cuts and we know how it is important to use the best possible ingredients to achieve the
best tasting bakes.

We also understand that the whole experience of enjoying a baked treat is to receive the
best possible service from a cheerful, happy and warm person who really cares. We take the time
with our team members grooming them and teaching about great customer experience. Aside
from selling the cupcakes themselves, The Baking Fairy also hopes to sell great and meaningful
experience to our customers.
 1.2 INTRODUCTION

A. Name of the company

The company’s name that has been decided and registered under the Registration of Business
Act 1956 is The Baking Fairy. “Baking” is taken because we wish and strive to be the best
cupcake baker in town, meanwhile, “Fairy” represents our product speciality, which is the glowing
factor.

B. Nature of Business
The Baking Fairy is a business based on partnership. Our business consists of six partners that
have been assigned with individual tasks and responsibilities. Our business is comprised of a
general manager, administrative executives, marketing executives, assistant marketing
executives, operations executives, and financial executives. The six members also agreed on a
partnership agreement that will bind the partners with any capital sharing, profit sharing and other
aspects that follow. The amount of profit is distributed according to percentage of capital
contribution of RM 12,000 for each partner. The Baking Fairy is a small cafeteria that specializes
in making glow-in-the-dark cupcakes. We offer five delicius cupcake flavours, which are vanilla,
red velvet, chocolate, oreo and coffee.

C. Industry Profile
Cupcake business is seen as a booming business over the past years. The reason is that these
cupcakes are not only pleasant to look at, but also offer a hassle-free way of eating. The cupcakes
are designed in small bite size, where it only take several small bites to finish the whole unit.
Forget the boring traditional cupcakes, The Baking Fairy presents you luminous, glowing cupcakes
in a variety of flavours. Now the customers can have some fun and amusement while keeping their
stomaches satisfied.
 D. Location of the business
The Baking Fairy is located at Lot LS21, Jalan Akuatik 13/64, Persiaran Akuatik, 40200, Shah
toAlam, Selangor. With population of more than 170 000 people, Shah Alam is proven to be one of
the most strategic places to incorporate a business.
 E. Date of business commencement
The Baking Fairy started its business operation on the 1st November 2013. In order to ensure all
operation and business are well organised, we started our business plan on the year of 2014. All
planning were done perfectly after surveying places, raw materials and population in order to
sustain our company for three years ahead and more.
.
F. Factors in selecting the proposed business
We see “glowing cupcakes” as something that is unusual and unique. Even though there are
already a plenty of busniesses making and selling cupcakes, however, The Baking Fairy has a
distinctive special factor in our very own cupcakes. Our cupcakes are made in the way that they
are able to glow in the dark. Just how many of glowing stuffs are edible to be eaten? The Baking
Fairy offers you one! The glowing factor in our cupcakes are both exciting and mind blown at the
same time. We also are very passionate in baking. We take our baking delicacies very seriously in
order to ensure that every and each cupcake that we sell could fulfill customers’ satisfaction and
beyond. We only want the best and par excellence for our customers.

G. Future prospects of the business

i. Increasing sales & marketing activities

We strongly believe that there are still significant opportunities to further the expansion of our
business. We intend to strengthen our sales and distribution network by enlisting experienced
marketing and sales personnels.

ii. Capacity expansion and facilities upgrade

We intend to acquire more production lines to double our capacity and upgrade existing production
facilities by purchasing new machineries and equipment.
 1.3 PURPOSE

Business plan is an ideal plan that shows a company the right way to start and develop a
business. A good business plan acts as a dinamic blueprint for running and expanding the
business. It describes the direction of the company is taking, what its goals are, where it wants to
be and how it is going to get there.

A business plan contains all of our product information, mainpower and financial estimates
and plans for the future. When you make updates to your business plan, you get to see how plans
for the future and how your purposed changes will affect your entire business. Business plan will
remind the company its original goals and how business changes will affect original vision.

The purposes of business plan are as below:

i. To make a loan from bank

A good and spectatcular business plan indirectly showing how excellent the
business actually is. It shows how well the business is being managed, driven by its
goals, mission and vision. It also shows the company’s ability to create profit and
other financial values. These are important in order to convince the bank to lend
some loan to the business.

ii. To convince investor confidence

By having the business planning, it can be used as a communication tools to gain
investor confidence in order to invest in our company. As we know, investment
through business can help us to raise financial sources from the outside parties.
Besides, we also can mobilize capital with opportunity to expand our business as
entrepreneur. Therefore, we need a strong business planning to gain confidence
from potential investors include private or individual investors and other financial
institutions.

iii. To make easy for the expectation in the future

A business planning contains a lot of information about business that we carry. So,
to make a prediction for the future, we as the entrepreneur need to refer these
business planning as it acts as guidelines in order to driven the business. Any plan
or decision to make changes in business or product, it must reflect the business
objectives.
iv. To convince the supplier
Help convince suppliers of the viability of our business venture. This is because
suppliers will refer to the business’ future plans so that they can make appropriate
decisions. Besides, it will benefit both the suppliers and our company in the long
term. Suppliers will trust our company more if we provide a professional business
plan.

v. Understanding of business
This will help the entrepreneur to have better understand the purpose of the
business and act as guideline to manage the business effectively and efficiently.
When the venture becomes a reality, the plans and strategies outlined in business
plan will be an important benchmark to help the entrepreneur gauge the progress.
1.4 BUSINESS BACKGROUND

Name of the Business

The Baking Fairy

Lot LS21, Jalan Akuatik 13/64,

Business Address
Persiaran Akuatik, 40200, Shah Alam,
Selangor.

info@thebakingfairy.com
E- mail
www.thebakingfairy.com
Website
603 - 92072005
Telephone Number
603 - 2166 5526
Fax Number
Partnership
Form of Business
Producing and selling glowing
Main Activity
cupcakes
1st November 2013
Date of Commencement
4th August 2013
Date of Registration
JM0666652-H
Registration Number
Maybank Berhad
Name of Bank
151444059977
Bank Account Number
 1.5 OBJECTIVES, MISSION AND VISION

A. Objectives
 Make a friendly environment and good service with customer.
 Offer high quality of food to the customer.
 Build a systematic working environment and operation running smoothly.

B. Vision
To touch and enhance lives through the best tasting baked treats, serving with them the
best possible customer experience.

C. Mission
To delight and tuch every customer so they return for more
 1.6 ORGANIZATIONAL CHART

General Manager

Khalid Alwalid

Administration Marketing Operational Financial

Executives Executives Executives Executives
Ermawati Nur Atikah Nik Norafrina Noor Hasanah

Assistant
Marketing Main Baker 1
Executives
Mariah

Assistant Baker 1 Assistant Baker 2

Assistant Baker 3
 1.7 LOGO AND MOTTO

A. Logo

The Baking Fairy The company’s name

Cupcake Our main product is cupcake

Star It symbolizes self-fulfilment and advancement in life.

It symbolizes joy and happiness in the darkest times,

glitters
giving vibes of fairy-tales.
pink It symbolizes joy and admiration
brown It symbolizes richness and boldness
white It symbolizes simplicity and cleanliness
yellow It symbolizes joy and happiness

B. Motto

“Cupcake; a smile with frosting on it”

 1.8 PARTNERSHIP BACKGROUND

A. General Manager

Khalid Alwalid Bin Khairudin

Name of Partners

860316-10-5895
Identity Card Numbers

Shah Alam, Selangor

Permanent Address

khalidalwalid@gmail.com
E- Mail

011-27170936
Telephone Number/Fax Number

16-03-1986
Date of Birth

Single
Marital Status

Bachelor of Business Administration

Academic Qualification (Hons) Entrepreneurship (UiTM)
Diploma in Business Study (UiTM)

Motivation of leadership seminar

Course Attended
Able to work under pressure
Skills Multi tasking

Manager at Tesco for 2 years

Experiences

General Manager
Present Occupation
B. Administrative Executives

Ermawati Binti Mad Daud

Name of Partners
870826-12-5132
Identity Card Numbers
Shah Alam, Selangor
Permanent Address
ermawati@gmail.com
E- Mail

Telephone Number/Fax 011-12756386

Number
26-08-1987
Date of Birth
Engaged
Marital Status

Bachelor of Business Administration (Hons)

Human Resource
Academic Qualification
Diploma in Office Management (UiTM)

Business Management Seminar

Course Attended
Discipline at work
Skills Strong in writting and computer skill
Administrative Manager at Air Asia for 1 year
Experiences
Administrative Executives
Present Occupation
C. Marketing Executive

Nur Atikah bt Azhar

Name of Partners
Identity Card Numbers
Permanent Address
E- Mail
Telephone Number/Fax Number
Date of Birth
Marital Status
Academic Qualification
Course Attended
Skills
Experiences
Present Occupation
860423-14-5622
Shah Alam, Selangor
atikahazhar@gmail.com
017-6996519
23-04-1986
Single
Bachelor of Business Administration
(Hons) Marketing (UiTM)
Diploma in Banking (UiTM)
Conventional Capital Market Talk
Communication skill
Cretive thinking
Sales manager at Aeon Mall for 2
years
Marketing Executives
D. Assistant Marketing Executives
Name of Partners
Identity Card Numbers
Permanent Address
E- Mail
Telephone Number/Fax Number
Date of Birth
Marital Status
Academic Qualification
Course Attended
Skills
Experiences
Present Occupation
Mariah bt Mohd Arshad
891029-01-5842
Shah Alam, Selangor
mariaharshad@gmail.com
017-244239
29-10-1989
Single
Bachelor of Business Administration
(Hons) (UiTM)
Diploma in Marketing (UiTM)
Management skills seminar in Penang
Manage time effectively
Multi-tasking
Sales assistant at Metrojaya Kuala
Lumpur for 3 years
Assistant Marketing Executives
E. Operations Executives

Nik Norafrina bt Nik Mohamad Anuar

Name of Partners
Identity Card Numbers
Permanent Address
E- Mail
Telephone Number/Fax Number
Date of Birth
Marital Status
Academic Qualification
Course Attended
Skills
Experiences
Present Occupation
891205-01-6298
Shah Alam, Selangor
afrinaanuar@gmail.com
011-1275 6376
05-12-1989
Single
Bachelor of Business Administration
(Hons) Operation Management (UiTM)
Diploma in Banking (UiTM)
Cooking class and Pastry class
Manage time effectively
Multi-tasking
2 years working in manufacturing
industry
Operations Executives
F. Financial Executives

Noor Hasanah bt Samijan

Name of Partners
870407-05-5192
Identity Card Numbers
Shah Alam, Selangor
Permanent Address
noorhasanah@gmail,com
E- Mail
011-1275 6376
Telephone Number/Fax Number
07-04-1987
Date of Birth
Single
Marital Status
Bachelor of Business Administration
(Hons) Finance (UiTM)
Academic Qualification
Diploma in Accounting (UiTM)
Financial Management Seminar
Course Attended
Able to do accounting budget
Skills Forecasting
2 years working experience with
Maybank as Assistant Financial
Experiences
Manager
Financial Executives
Present Occupation
1.9 PARTNERSHIP AGREEMENT

DATED 4th DAY OF AUGUST 2013

BETWEEN

KHALID ALWALID BIN KHAIRUDIN

AND

ERMAWATI BINTI MAD DAUD

AND

MARIAH BINTI MOHD ARSHAD

AND

NUR ATIKAH BINTI AZHAR

AND

NOOR HASANAH BINTI SAMIJAN

AND

NIK NORAFRINA BINTI NIK MOHAMAD ANUAR

***************************************************************

PARTNERSHIP AGREEMENT

***************************************************************
 PARTNERSHIP AGREEMENT

THIS PARTNERSHIP AGREEMENT is made 4th day of AUGUST 2013

BETWEEN

KHALID ALWALID BIN KHAIRUDIN (I/C No : 860316-10-5895) of Shah Alam, Selangor

(hereinafter called “KHALID”) of the one part;

AND

ERMAWATI BINTI MAD DAUD (I/C No : 870826-12-5132) of Shah Alam, Selangor (hereinafter
called “ERMA”) of the second part;

AND

MARIAH BINTI MOHD ARSHAD (I/C No : 891029-01-5842) of Shah Alam, Selangor (hereinafter
called “MARIAH”) of the third part;

AND

NUR ATIKAH BINTI AZHAR (I/C No : 860423-14-5622) of Shah Alam, Selangor (hereinafter
called “ATIKAH”) of the fourth part;

AND

NOOR HASANAH BINTI SAMIJAN (I/C No : 870407-05-5192) of , Shah Alam, Selangor

(hereinafter called “HASANAH”) of the fifth part;

AND

NIK NORAFRINA BINTI NIK MOHAMAD ANUAR (I/C No : 891205-01-6298) of , Shah Alam,
Selangor (hereinafter called “AFRINA”) of the six part;

(hereinafter shall collectively be referred to as the Partners)

WHEREAS :-

A. The parties hereto are currently the partners to a business entity known as “The Baking
Fairy” a partnership business registered under the Business Registration Act 1956 and having its
address at Lot LS21, Jalan Akuatik 13/64, Persiaran Akuatik, 40200, Shah Alam, Selangor.
(hereinafter referred to as “the Partnership”)

B. The partnership is now carrying on the business of baking and selling cupcakes and such
other related business activities (hereinafter referred to as “the Partnership Business”).

C. The initial capital of the Partnership Business is Ringgit Malaysia Seventy Two Thousand
(RM72,000.00) only.

D. The parties hereto hereby agree to set out and regulate the terms and conditions governing
the relationship among them as partners to the Partnership subject to the terms and conditions
herein contained.
NOW IT IS HEREBY AGREED as follow;

1.0 PLACE OF BUSINESS

The Partnership Business shall be carried out at Lot LS21, Jalan Akuatik 13/64,
Persiaran Akuatik, 40200, Shah Alam, Selangor or at such other place or places as the
Partners from time to time may approve (hereinafter referred to as the “Demised Property”).

2.0 DURATION OF PARTNERSHIP

This Partnership Agreement shall have full force from the date of this Agreement and shall
continue to bind on the Partners until it is determined as hereinafter specified.

3.0 CAPITAL AND ACCOUNT

3.1 The Partners shall immediately after the signing of this Agreement pay into an
account to be opened in the name of the Partnership Business (hereinafter referred to as “the
Partnership Account”) a sum of Ringgit Malaysia Seventy Two Thousand (RM72,000.00) only or
any other sum as may be agreed upon by the Partners herein (hereinafter referred to as “Initial
Capital”). The details of the Initial Capital are as follows:

NAME EQUITY EQUITY

CONTRIBUTION CONTRIBUTION
(%) (RM)
Khalid Alwalid Bin Khairudin 16.67 12,000
Ermawati Binti Mad Daud 16.67 12,000
Mariah Binti Mohd Arshad 16.67 12,000
Nur Atikah Binti Azhar 16.67 12,000
Noor Hasanah Binti Samijan 16.67 12,000
Nik Norafrina Binti Nik 16.67 12,000
Mohamad Anuar
TOTAL 100 72,000

3.2 Khalid Alwalid Bin Khairudin and Ermawati Binti Mad Daud shall be the
signatories to the Partnership Account.
3.3 Any payment out of the partnership account shall have been first approved by all the
parties to this agreement.

3.4 The Partners shall appoint an independent accountant (hereinafter called “the
Accountant”) to manage the yearly account of the Partnership Business.
 3.5 The Partners shall properly keep all books of account of the Partnership Business at
the office of the Partnership Business and will open for inspection by any of the Partners hereto at
any time.

3.6 All the working staff will be appointed by both Partners, and their wages and salaries
and other emoluments will be fixed in the same way.

4.0 PROFIT AND LOSS

4.1 Each of the Partners shall be entitled to the Partnership Business profit in
accordance with the percentage of their respective equity contribution as specified in clause 3.1
herein and shall also bear all losses in the same proportions.

4.2 The Partners shall direct the Accountant in pursuant to Clause 3.4 herein to calculate
all assets and liabilities of the Partnership Business and prepare a yearly balance sheet and profit
and loss account and share of profits.

4.3 All the balance sheet and profit and loss account and share of profits as stipulated in
Clause 4.2 herein shall upon its completion be signed by the Partners and thereafter the Partners
shall be bound thereby unless manifest error shall be found therein within one (1) month in which
case such error shall be rectified.

5.0 PARTNERS’ SALARY AND PARTNERSHIP MONIES

5.1 As compensation for partners’ services in and to the Partnership business, each Partner
shall be entitled to a salary of RM1,900.00 each month, which shall be deducted by the
Partnership as an ordinary and necessary business expense before determination of net profits.
The salary of any Partner maybe increased or reduced at any time by mutual agreement of all the
Partners.

5.2 The Partners shall be entitled to draw out of the Partnership Account on a monthly
basis or as the case may be on account of their respective shares of profits as specified in Clause
4.1 herein.

5.4 In the event the account taken by the Accountant appears that any partner or
Partners has drawn any sum in excess of their share of profits as specified in Clause 4.1 herein he
shall forthwith repay such excess into the Partnership Account or to be deducted from his monthly
salary or next profit account.
6.0 DUTY AND LIABILITY

6.1 Each Partner shall be just and faithful to the other Partners and shall diligently attend
to the Partnership Business and devote their whole time and attention thereto.

6.2 No Partner shall without the consent of the other Partners enter into any contract,
engage in any business other than that of the Partnership Business or engage or dismiss any
employee of the Partnership Business or become bail or surety for any person or lend any
partnership property release any debt due to the Partnership Business except in the ordinary
cause of business draw accept or indorse any bill of exchange.

6.3 In the event of any Partner shall engage in any other contract or business
transaction or any acts other than as stipulated in Recital B herein without the consent of the
other, the Partner who unilaterally enter into such contract or business transaction or acts shall be
solely liable for such contract or acts and fully indemnify the other Partners in the event the other
Partners is held to be liable for such contract or acts.

6.4 In the event the Partners intend to engage employees, agents or any other person
for the purposes of the Partnership Business, such employees, agents or any other person shall
only be engaged upon mutual consent and agreement of the Partners.

6.5 The Partners shall be jointly responsible and liable for the rental of the Demised
Premises as specified in the Tenancy Agreement entered into between the Partnership and the
landlords of the Demised Premised as attached herewith.

6.6 Each of the partners hereto, subject to that is herein otherwise provided shall:-

a) Participate and attend to the business to the greatest common advantage of the
Partnership Business.

b) Be just and faithful to each other.

c) Render true accounts and full information of all moneys affecting the Partnership
Business to the other.

d) Indemnify the Partnership Business for any loss caused to it by willful negligence
or fraud in the conduct of the Partnership Business.

e) Attend to the Partnership Business diligently and actively.

f) Not to withdraw any amount for his own benefit or use as remuneration or
otherwise without the consent of the others, except to the extent hereinbefore
provided.
 g) Every party shall account for the profit earned from any transaction of the
Partnership Business or from the use of the Property in any business transaction
of the Partnership Business.

7.0 DISSOLUTION AND RETIREMENT

7.1 This Partnership Agreement may be determined by giving to the other Partners not
less than three (3) months’ notice in writing and agreed upon by all the Partners of the Partnership
Business.

7.2 If this Partnership Agreement shall be determined by notice pursuant to Clause 7.1 herein
or dissolved by the death or bankruptcy of any Partner or by order of the Court, the Partner whom
notice was given or the surviving or solvent Partner or the Partner on whose application such
order was made as the case may be, may within fourteen (14) days from the giving of such notice
or within fourteen (14) days from such death or bankruptcy or the making us such order as the
case may be, by notice in writing to the other Partners or their personal representatives trustee in
bankruptcy or receiver, elect either to have the Partnership Business wound up pursuant to the
provisions of the Partnership Act 1961 or to purchase the share of the other Partner at the net
value thereof as agreed between the Partner giving notice (hereinafter called “the Purchaser”) and
the other Partner or his personal representatives, trustee in bankruptcy or receiver as the case
may be (hereinafter called “the Vendor”) or in default of such agreement as assessed by a valuer
to be nominated by the Purchaser and the Vendor jointly in writing and in agreeing or assessing
the net value of such share the goodwill of the Partnership shall be taken into account.

7.3 Any value so nominated or appointed as specified in Clause 7.2 herein shall act as
an expert and not as an arbitrator and his professional charges shall be borne by the Vendor and
the Purchaser in equal shares.

7.4 On the purchase by a partner of the share of the other partner pursuant to Clause
7.2 herein the purchase money shall be paid by the partner who purchases the share of the other
on a date to be agreed upon by the partners or their personal representatives.

7.5 If a partner desire to retire from the Partnership Business he shall give to the other
partners at least one month’s written notice to that effect and shall on the expiration of the said
notice period be deemed to have retired from the Partnership Business.

7.6 If a partner retires from the Partnership Business the retired partner shall not be
entitled to carry on the same or similar business in the same name as that of the Partnership
Business.

7.7 The dissolution of the Partnership Business or the purchase of the other partner’s
share by the remaining partners and the retirement of the partners shall not affect the continuation
of the Partnership Business under the trade name The Baking Fairy, unless all the Partners
mutually agreed to dissolve the Partnership Business.
8.0 CONTROVERSY OR CLAIM

Any controversy or claim arising out of or relating to this Agreement, or the breach hereof, shall be
referred to any court having jurisdiction thereof.

9.0 ILLEGALITY

Each provision of this Agreement shall be construed separately and in the event any
provision of this Agreement shall prove to be illegal or unenforceable, the remaining provision shall
remain in full force and effect.

10.0 ASSIGNMENT

Neither this Agreement nor any rights granted hereunder may be assigned extended or
otherwise transferred by either of the partner to any third parties without the written consent of the
other partner.

11.0 TIME

Time wherever mentioned in this Agreement shall be of the essence of this Agreement.

12.0 NOTICE

Any notice required to be given by either of the partners hereunder shall be in writing and shall be
served by either of the partners hereto on the other partner and shall be deemed to be sufficiently
served on the other partner if left at or sent by prepared registered post to the partners respective
addresses as herein contained and if sent by post shall be deemed to be served three days after
the date of posting and shall take effect thereon.

13.0 BINDING EFFECT

This Agreement shall be binding on the respective permitted assigns and heirs, personal
representatives and successors-in-title of the partners herein.

14.0 INTERPRETATION

In this Agreement unless the context states otherwise the following interpretation shall be
adopted;

a) Words importing the singular number shall include the plural and vice versa.

b) The headings to the Clause are for ease of reference only and shall not affect the
interpretation or construction of this Agreement.
 c) Words importing the masculine gender shall include the feminine and neuter gender
and vice versa.

15.0 LEGAL FEES AND DISBURSEMENT

All legal fees and disbursement incurred or t be incurred for the preparation and execution
of this Agreement shall be shared equally by the partners herein.
IN WITNESS WHEREOF the parties hereto have hereunto set their hands the day and year first
above written.

SIGNED AND DELIVERED by

Khalid Alwalid Bin Khairudin ……………………………………….
In the presence of: - Khalid Alwalid Bin Khairudin

SIGNED AND DELIVERED by

Ermawati Binti Mad Daud ……………………………………….
In the presence of :- Ermawati Binti Mad Daud

SIGNED AND DELIVERED by

Mariah Binti Mohd Arshad ……………………………………….
In the presence of: - Mariah Binti Mohd Arshad

SIGNED AND DELIVERED by

Nur Atikah Binti Azhar ……………………………………….
In the presence of:- Nur Atikah Binti Azhar

SIGNED AND DELIVERED by

Nik Norafrina Binti Nik Mohamad Anuar ……………………………………….
In the presence of: - Nik Norafrina Binti Nik Mohamad Anuar

SIGNED AND DELIVERED by

Noor Hasanah Binti Samijan ……………………………………….
In the presence of: - Noor Hasanah Binti Samijan
 2.1 INTRODUCTION

Administration department is one of the important departments in an organization. There

have to be a person, an administrator, to keep all of the administration tasks in check in every
organization. Administrator is responsible for maintaining structure, user accounts, bulletin boards
in its learning and others.

The Baking Fairy must have a disciplined staffs as the representative of the company. It is
one of the duties of administrator to lead and take care of every staffs to ensure they are satisfied.
Other duty is to make sure that the welfare of the staffs is guaranteed and secured. Moreover,
administrator must ensure to the wages and salaries of the partners and employees are paid
timely and accordingly.

Furthermore, the administration department is responsible to ensure staffs are guaranteed

with SOCSO, EPF and other benefits. These are done to attract and retain the employees to keep
on contributing to the company and secured them if there is an incident. Other scope of job of an
administrator is to record all things that happened inside and outside of the company, as well as
helping the General Manager.
2.2 IMPORTANCE

1. Establishing and carrying out company’s objectives, vision and mission procedures
of the company.

2. Applying new technologies in the workplace.

3. Directing and overseeing an organizations’ financial and budget activities.

4. Approving or negotiating documents and agreements.

2.3 ORGANIZATIONAL STRATEGY

1. Making a systematic working and division to increase quality of work, in order to

reduce delay time.

2. Ensuring that The Baking Fairy’s products are made from high quality raw materials
to increase the customers’ satisfaction.

3. Maintaining a high level of hygiene so that the customers will be confident with the
products.
 2.4 Organizational Chart for Administration

General Manager

Khalid Alwalid

Administration Marketing Operational Financial

Executives Executives Executives Executives
Ermawati Nur Atikah Nik Norafrina Noor Hasanah

Assistant
Marketing Main Baker 1
Executives
Mariah

Assistant Baker 1 Assistant Baker 2

Assistant Baker 3
2.5 List of Personnel

POSITION NUMBER OF PERSONAL

GENERAL MANAGER 1

ADMINISTRATIVE MANAGER 1

MARKETING MANAGER 1

ASSISTANT MANAGER 1

OPERATIONAL MANAGER 1

FINANCIAL MANAGER 1

3
EMPLOYESS

TOTAL 9
2.6 Task and Responsibilities

POSITION TASK AND RESPONSIBILITIES

Responsible for supervising all administrative

functions in the business and delegating
General Manager administrative tasks such as accounting
paperwork, payroll.

Sustaining organizational staffs by recruiting,

selecting, orienting and training employees,
maintaining a safe and secured work
Administration Executives environment and developing personal growth
opportunities.

Monitoring and analyzing market trends and

Marketing Executives studying competitors’ products and services.

Helping the marketing department to handle

Assistant Marketing the tasks and assisting in promoting and
Executives exposing the products to the public.

Monitoring and analyzing the current system

of production, working out a strategy for
Operations Executives improving if necessary and managing day to
day activities .
 Developing and making sure the
organizational financing is under control from
Financial Executives
budget from all departments.

Main Baker and Assistant Helping in the operation department.

Bakers
 2.7 Schedule of Remuneration

POSITION NO MONTHLY EPF SOCSO AMOUNT

SALARY CONTRIBUTION (1.75%) (RM)
(RM) (13%) (RM) (RM)

General Manager 1 1 960.75 299.00 40.25 2 300.00

Administrative
Manager 1 1619.75 247.00 33.25 1 900.00

Marketing Manager 1 1619.75 247.00 33.25 1 900.00

Assistant Marketing
Manager 1 1619.75 247.00 33.25 1 900.00

Operations Manager 1 1619.75 247.00 33.25 1 900.00

Financial Manager 1 1619.75 247.00 33.25 1 900.00

TOTAL 6 10 059.50 1 534.00 206.50 11 800.00

POSITION No Monthly EPF SOCSO AMOUNT
Salary Contribution (0.5%) (RM)
(RM) (10%) (RM) (RM)

Main 1 1 163.50 130.00 6.50 1 300.00

Bakers

Assistant 3 895.00 × 3 100.00 × 3 5.00 × 3 1 000.00 ×

Bakers 3

TOTAL 4 3 848.50 430.00 21.50 4 300.00

 2.8 Employment Benefits

A. Salary increment
Salary increment is given to the workers based on profit every year.

B. Bonuses
Bonuses will be given to those who work for more than 2 years.

C. Employee provident Fund (EPF)

EPF is compulsory to be provided by the employer to every full time employees as stated in
the Employment Act 1955.

i. Employer (company) - 13% for any wages less than RM5,000 & 12% for more than
RM5,000
ii. Employees (staff / workers) - 10%

The employer’s contributions are tax deductible up to 20% of the employer’s pay. As such,
the company is encouraged to contribute more than the statutory rate of 12% to enjoy
greater tax benefits.

D. Social Security Organization (SOCSO)

i. An employee will be given this SOCSO benefit as protection for any circumstances such as
accident before working hour, during working hour and also after working hour.
ii. 0.5% for the emplyees and 1.75% for the employer will be deducted from their salaries for
contribution.
iii. If any accident happened they can claim this SOCSO as what have been stated in the
Employment Act 1955
 2.9 WORKING PROPERTIES

A. Working Hours

Staff Day Hours

Tuesday, Wednesday and Thursday Working Hours

10a.m. – 10p.m.
Business Hours
11a.m. – 10p.m.

Friday - Sunday Working Hours

9a.m. – 10p.m.
Business Hours
10a.m. – 10p.m.

Break hour (by shift) 12.00p.m. – 1.00p.m.

7.00p.m. – 8.00p.m

Off-day
Monday – Off Day
Tuesday – Operations Manager & General Manager
Wednesday – Administrative Manager
Thursday – Financial Manager
Friday – Marketing Manager
 B. Annual Leave
Provision of 15 days leave per year will be given to the workers in writing letter and must
be submit a week before leave.

C. Emergency Leave
Emergency leave is given to emergency cases such as death or accident of the family
members.

D. Medical Leave
Medical leave is given on doctor’s confirmation and with medical certification.

E. Maternity Leave
For women workers, they have their maternity leave for at least 90 days.

F. Leave Public Holidays

 Each employee is entitled to 11 days of public holidays for each calendar year
selected from all gazetted public holidays for the year.
 The mandatory public holidays must include the following four days:

i. The National Day

ii. The Birthday of Yang di Pertuan Agong
iii. Birthday of Sultan or the In-President of the State or Federal Territory Day
iv. Workers Day celebration
v. Malaysia Day

The remaining 6 days can be selected by the employer and the days to later can only be
substituted with the consent of the employee. Employers must exhibit a notice stating the place of
the employment of the selected six days before the start each calendar year in question.
2.10 OFFICE LAYOUT
 2.11 LIST OF OFFICE EQUIPMENT AND SUPPLIES

NO ITEM QUANTITY COST TOTAL

(PER UNIT) (RM)
1 Office equipments and furnitures
Manager’s table
Manager’s chair 1 180 180
Small dustbin 1 80 80
Coffee table 1 10 10
Sofa set 1 250 250
Computer 1 550 550
Fire extinguish 1 1599 1599
Telephone 1 150 150
Air Conditioner
1 150 150
Printer
1 1300 1300
Stationaries
1 215 215

6 20 120

TOTAL 4604
 2.12 ADMINISTRATION BUDGET

ITEM ASSET MONTHLY OTHER PRE TOTAL

EXPENSES EXPENSES EXPENSES OPERATING (RM)
(RM) (RM) (RM) (RM)
Fixed asset
Office Equipment & 4 604.00 4 604.00
Furniture
Second-hand van 9 800.00 9 800.00
Machine 5 000.00 5 000.00
Working capital
Rent 2 500.00 2 500.00
Salary 13 908.00 13 908.00
EPF (13% and 10%) 1 964.00 1 964.00
SOCSO (1.75% and 228.00 228.00
0.5%)
Bill : Water 35.00 35.00
Bill : Electricity 230.00 230.00
Bill : Internet Wi-Fi & 100.00 100.00
Telephone
Pre-operating expenses

Business Registration 60.00 60.00

Fees

License of Business 50.00 50.00

Fees
Halal Certification 100.00 100.00
License of Fire 10.00 10.00
Extinguisher
First Aid Kit 50.00 50.00
TOTAL 19 404.00 18 965.00 50.00 220.00 28 839.00
 3.1 INTRODUCTION

Marketing is the management process through which goods and services are performed to
the customer. It includes four elements which are product, price, place and promotional strategy.
Market research involves collecting, recording and interpreting the data or information about
customer, product, competitor and market. Then, it will be used to make market decisions.

The purpose of running a business is to gain profits and growth. This is a fact that we
cannot outrun because there is no one on earth that will run a business just to finish up their initial
capital and waste their money. This is where the importance of marketing plan plays an important
role since it is one of the major steps that will directly contribute in achieving our business
objectives. This is not something small which can be done by one person alone, but it needs the
participant of everyone in the organization. Therefore, it is a ‘must’ for every business people to be
exposed on the basic knowledge of marketing.

In order to enhance the marketing strategies, the business are making advertisement
through social network such as Facebook, Instagram, and also e-mail to give more information
about the product. Apart from it is easy to handle, social networking can spread the information
faster to the consumers. From social network, the business’s product can be improved through the
comment and also suggestion from consumers to make sure our product always achieve
consumers’ needs and wants. Fliers, business card, bunting, and signboard also can be part of the
strategies to attract the customers towards the products.

Our company, The Baking Fairy will also be concentrating on target market, competitors
and promotional strategies in marketing our product to each our sales target. Our business main
priority is to maximize the profit without neglecting the satisfaction of our customers. For that, it is
important for our company to plan and implement ways on achieving our customers’ satisfaction
and gain their trust.
 3.2 MARKETING OBJECTIVES

Marketing objectives can be defined as a goal set by a business when promoting its
products or services to potential consumers that should be achieved within a given time frame. A
business’s marketing objectives for particular products might include increasing product
awareness among targeted consumers, providing information about product feature, and reducing
consumer reluctance to buying the product.

i. Improving product awareness

A marketing effort can be focused on reviving interest in product that has been on the
market for a long time or about which people have longstanding attitude. This is because
people often seek a safety and affordable product. So, by doing these marketing,
customers will know more about the product and automatically it will improve our product
awareness.

ii. To attract more customers

The aim of doing marketing is to make customer interested with our product. If the products
become a market leader, it will increase the sales which then will significantly exceed the
cost incurred. It is often insufficient to simply state an objective of increasing sales by a
certain percentage and gain more profits for the long terms of operation runs in our
business industry.

iii. Establishing the company in the industry

A new organization will find it extremely difficult to be heard above the noise in crowded
marketplace, with public distractions by many stimuli speculations. The business must be
braved in order to face the risks in this industry. The business must prepare mentally and
physically.
 3.3 PRODUCT DESCRIPTION

Cupcakes from The Baking Fairy offer a wide variety of delightful flavored cupcakes,
which include; Chocolate flavored Cupcake, Coffee flavored Cupcake, Oreo Cupcake and old time
favorites like Red Velvet and Vanilla. The bakery provides a fresh batch of cupcakes at all times
during business hours and will also open for orders more than 12 cupcakes. What makes our
cupcakes special and unique is that the icing of the cupcakes can glow in the dark. We believe
that every day you should have something a little special, which is why we've added some
uniqueness to our cupcakes. We also accept assorted flavored cupcake upon request from the
customers. The baking Fairy takes our business very seriously where we make sure the quality of
our cupcakes from every batch is in top notch quality. We only choose the best ingredients for our
customers.

Vanilla
Red Velvet

Chocolate
Oreo

Coffee
 Our specialty; glow in the dark cupcake under black light

What really differentiate The Baking Fairy from the rest of cupcake business is that
we offer extra fun and excitement in our cupcake; a glow-in-the-dark cupcakes! We escape from
the traditional, boring normal cupcake circle. This is very suitable for the millennials generation
who always seek for changes and adventure. The Baking Fairy transforms your “edible-glow-in-
the-dark-cupcake” fantasy into a living reality, just like the name suggest, a fairy indeed!
 3.4 TARGET MARKET

Target market is a place where we want to market our product or give services to the
customers. The business must focus its activities on attracting a core group of customers that has
the highest potential to purchase the goods offered. First of all the company has to decide the
most strategic place in developing our business.

For our target market, we chose Seksyen 13, Shah Alam. This is because the place
is one of the most developing areas in Shah Alam. With a population of 641, 306 people in Shah
Alam itself, it opens a wide opportunity to attract people to become our potential customers. The
retail cupcake industry in Malaysia has recently experienced rapid growth. The idea of small, bite
size cakes really catch the attention of the publics, and thus, stimulate the consumption of
cupcakes throughout the year.

The Baking Fairy wants to establish a large regular customer base, and therefore is
concentrating its business and marketing on local residents, which will be the dominant target
market. This will establish a healthy, consistent revenue base t ensure the stability of the business.
In addition, tourist traffic is expected to comprise approximately 15% of the revenues. High
visibility and competitive products and service are critical to capture this segment of the market.
Our business is focusing towards kids, teenagers, and adults who are cupcake lovers.
 3.5 MARKET SEGMENTATION

Market segmentation is the process of defining and subdividing a large homogenous

market into clearly identifiable segments having similar needs, wants, or demand characteristics.
Its objective is to design a marketing mix that precisely matches the expectations of customers in
the targeted segment.

Firstly, to achieve our mission and vision, we had identified our target market based on the
bases for segmenting consumers which is Demographic and Geographic segmentation to identify
our valuable customers.

For Demographic Segmentation, we decided to segment the markets by their age and race.
For the age, we target our potential customers from the range of 6 years old until 45 years of age.
This is because during that age, people still love to eat desserts. In the other hand for the race, we
target all groups of ethnics which are Malay, Chinese, Indian and others to try out our
cupcakes. These market segments consume the majority of the cake industry.
 3.6 MARKET SIZE

Market size can be defined as the number of individuals in a certain market who are
potential buyer or sellers of a product or service. The market size is usually quoted in a unit of
sales or monetary value for a specific period of time. The potential purchase includes the purchase
of the competitor within the same market. The market size includes all the competitors that are
already existed in the market. The competitors are in the same line and have their own share in
the market.

After conducting some research, we estimated that there are around 591 713 people
living in Seksyen 13, Shah Alam. The population of family estimated is between 80 000 to 90 000
families. The majority of the population living in Seksyen 13, Shah Alam consists of 70 percent
Malay, 20 percent Chinese while 10 percent from other races. This research is done by including
all type of ages. Results obtained are as follows:

Category Percentage (%) No. Of people

Adult 23.7 140 236

Student 47.8 282 839

Children 28.5 168 638

Total 100 591 713

Total market size 6 180 000

Total population (Seksyen 13, 591 713

Shah Alam)
Total market potential 15% x 591 713 88 757

Potential customer 7% x 88 757 6 213

Total sales per month 6 213 x RM 5.90 RM 36 656.70

Total sales per day 36 656.7 / 26 RM 1 409.87

 3.7 COMPETITORS

Competitors refer to other business that offer similar, substitute, or alternative products or services
to the same target market. It is good to have a competition so that we can improve our business.
We have identified three competitors after a research has been made. They are Wondermilk,
Sugar Candy and Dizzy Cupcake.

Competitors Strengths Weaknesses

1- Strong Brand Name

2- Have their own regular 1- Lack promotional activities
Wondermilk customers 2- Small customer area
3- Provides variety of 3- Expensive
cupcakes

1- Quite well-known
2- Offers a friendly and
1. Limited flavour choice
Sugar Candy personalised service
2. Service hour too short
3- Have been in the market for
quite awhile

1. Lack promotional activities

1- Taste good
2. Slow service
Dizzy Cupcake 2- Low price
3. Not widely known
4. Location not strategic

Ranking of the competitors

Rank No Competitors
1 Wondermilk
2 Sugar Candy
3 Dizzy Cupcake
 3.8 MARKET SHARE

A. Market share before the entry of your company

Competitors Before Entrance Sales (unit) Amount

(%) (RM)
Wondermilk 44 260 355 1 536 094.50
Sugar Candy 30 177 514 1 047 332.6
Dizzy Cupcake 14 82 839 488 750.1
Others 12 71 005 418 929.5
TOTAL 100 591 713 3 491 106.7

Market Share

12%
Wondermilk

14% Sugar Candy

38%
Dizzy Cupcake

others

24%
B. Adjusted market share after the entry of your company

Competitors After Entrance Sales (unit) Amount

(%) (RM)
Wondermilk 32 189 349 1 117 159.10
Sugar Candy 26 153 845 907 685.5
Dizzy Cupcake 21 124 259 733 128.10
The Baking Fairy 12.6 74 556 439 880.40
Others 8.4 49 704 293 253.6
TOTAL 100 591 713 3 491 106.7

Market Share

9%
Wondermilk
12% 38% Sugar Candy
Dizzy Cupcake
The Baking Fairy
14% Others

24%
3.9 SALES FORECAST

Number of TOTAL
Month Price (RM)
production (price x unit) / RM)
January
4 238 5.90 25 004.20
2017

February
4 322 5.90 25 499.80
2017

March
5 053 5.90 29 812.70
2017

April 2017 4 020 5.90 23 718.00

May 2017
(Teacher’s
Day & 7 890 5.90 46 551.00
Mother’s
Day)

June 2017 6 159 5.90 36 338.10

July 2017 4 095 5.90 24 160.50

August
8 370 5.90 49 383.00
2017

September
7 645 5.90 45 105.50
2017

October
2017
5 324 5.90 31 411.60
(Children’s
Day)

November
8 540 5.90 50 386.00
2017

December
2017
(School 74 556 5.90 52 510.00
Break &
Christmas)

Total 439 880.40

 3.10 MARKETING STRATERGY

Marketing strategy is the process of selection of the product mix and customer profile for
maximum profit. The marketing strategy consists of four key variables which is known as 4Ps ;

1. Price
2. Place
3. Product
4. Promotion

A. Product

Product may be defined as everything both favorable and unfavorable, that a person
receives in an exchange. Our cupcake has its own quality because we choose the best
ingredients. We produce chocolate flavored Cupcake, Coffee flavored Cupcake, Oreo Cupcake
and old time favorites like Red Velvet and Vanilla. What differentiate our cupcakes from others is
that our cupcakes are made to glow in the dark. We also accept assorted flavored cupcake upon
request of the customer.

B. Price

We charge our cupcakes with affordable and reasonable price to our potential customers as
a way to attract them. Price is based on total cost of the product plus standard mark up. Our
pricing objective is based on profit oriented which is profit maximization as to make sure our
business will be long lasting in the market.

We have decided to sell our product at RM 5.90 after considering all the cost involved.
Since the product is new in the market, we are not taking a risk to increase our price yet. At the
beginning, we only need to ensure our business is stable.
 C. Place

We deem our location to be a strategic place by evaluating the population around the Shah
Alam Valley. The main reason for choosing Shah Alam is because it is one of the most popular
places visited by foreigners in Malaysia. Shah Alam also has a relatively high number of
population in Selangor. Shah Alam also is recognized as a place with high potential for economic
growth. Generally, we sell our cupcakes at our shop directly to our customer. We also offer cash
on delivery in Shah Alam, Subang Jaya, Setia Alam and Klang Valley area.

Our shop is located at Jalan Akuatik 13/64, Persiaran Akuatik, Seksyen 13 which is near to
Aeon Shah Alam. We choose this location because it is easy to access by people living in Shah
Alam especially to students such as from UiTM, MSU and other universities located in Shah Alam.
Furthermore, the majority of the population in this area is Malay and Muslim, in which it is easier
for our business to attract more Muslim buyers since our product is certified to be halal.
 D. Promotion

i. Business Card
ii. Loyalty Card

iii. Signboard
iv. Instagram
v. Flyer
vi. Bunting
3.11 LAYOUT PLAN
3.12 MARKETING BUDGET

Item Fixed Assets Monthly Expenses Other TOTAL

(RM) Expenses (RM)
(RM)

Fixed Asset

Signboard 1400.00 1400.00

Other Expenses

Business card 100.00 100.00

(0.20 x 500)

Bunting 80.00 80.00

Flyers 200.00 200.00

(0.10 x 1000)

Grand opening 1 200.00 1 200.00

TOTAL 1400 200.0 1 580.00 2 980.00

 3.13 ORGANIZATION CHART

MARKETING
DEPARTMENT

MARKETING EXECUTIVES ASST. MARKETING EXECUTIVES

NUR ATIKAH BINTI AZHAR MARIAH BINTI MOHD ARSHAD
3.14 MANPOWER PLANNING

POSITON NUMBERS

Marketing Executives 1

Assistant Marketing Executives 1

Total 2
 3.15 SCHEDULE OF TASK AND RESPONSIBILITIES

DEPARTMENT Marketing Manager

NUMBER OF PERSONNEL 2

 Manages external research and coordinate all the

internal sources of information to retain the
organizations’ best customers and attract new
ones
 Model demographic information and analyze the
volumes of transactional data generated by
customer purchases
 Identifies, prioritizes, and reaches out to new
partners, and business opportunities et al
TASK AND RESPONSIBILITIES
 Responsible for supervising implementation,
advocate for the customer’s needs, and
communicate with customers
 Develops, executes and evaluates new plans for
expanding increase sales
 Documents all customer contact and information
 Represents the company in strategic meetings
 Helps increase sales and growth for the company
 4.1 INTRODUCTION

Operation is one of the important functions in business organization. Operational planning is

the process of planning strategic goals and objectives to tactical goals and objectives. It describes
milestones, conditions for success and explains how or what portion of a strategic plan will be put
into operation during a given operational period. Without operation plan, a business cannot
operate properly.

In The Baking Fairy, business had been planned and structured to ensure that the quality
and quantity of the products can meet the needs of customers. In operation systems, there are
important components such as input, transformation process, output, control or feedback and
external environment. The components of an operations system can be portrayed in the schematic
diagram as shown below:

External Environment

Input Transformation Process Output

Control / Feedback
A. Inputs
Inputs are defined as whatever entities in the form of materials personnel, capital, utilities,
and information which go into transformation process to produce output. The input that we
use to make this glowing cupcakes are tonic water, flour, butter, caster sugar, eggs, milk,
baking powder, brown sugar and vanilla essence.

B. Transformation Process
It is the actual process of physically changing the inputs into outputs of product or services.
We transform those raw materials into edible, delicious glowing cupcakes.

C. Output
It is the accomplishment of operation system that is the greater value than the sum of the
inputs. It is in the form of desired products or services. The final output of The Baking Fairy
is the glowing cupcakes.

D. Control/Feedback
It is the process of making sure that the desired output are obtained by taking actions at
various points.

E. External Environment
It is the term coined to explain that the operations system is affected by external factors
which include random and unexpected events that can cause planned and actual output to
differ.
 4.2 OPERATIONAL OBJECTIVES

1. To ensure there is enough materials to produce our product

2. To ensure that the operation runs smoothly and systematically according to the operations
activities

4.3 OPERATIONAL STRATEGIES

In order to achieve a higher profit and customer satisfaction, The Baking Fairy has planned
several strategies in the production department. The strategies are as stated below:-

 Analysing the market size and targeting the market to determine the suitability of the
product in the market area in order to fulfil the desires of the customers.

 Ensuring the production process follows the specification precisely as wanted by the
government’s specification and authority.

 Ensuring the condition of workers, operations place and all the materials and equipment are
in good condition.

 Analysing all the problems exist and take action on it.

 Always keep close attention on the operation.

 4.4 SYMBOLS USED IN THE PROCESS CHART

Symbol Activity Description

Operation Activity that modifies, transforms or gives added value to

the inputs.

Transportation Movement of materials or goods from one place to

another.

Inspection Activity that measures the standard or quality.

Delay Process is delayed because in-process materials need to

wait for the next activity.

Storage Finished product or goods are stored in the storage area or

warehouse.
4.5 FLOW CHART OF PRODUCTION

Measure the flour, egg, butter, sugar, etc

Mix and blend ingredients

Inspect quality of batter

Batter is poured into paper cup

Cupcake are baked at 350º - 450º for 15 or 20 minutes

Cooling of cupcakes

Inspection of cupcakes’ quality

Prepare the icing

 Apply the icing

Cupcakes are stored in the confectionary showcase

Process
4.6 ACTIVITY CHART

Greet the customers

Bring customers to the confectionary

display

Ask the customers to choose the flavours

Pack the cupcakes into the packaging

The customers make payment and get the

cupcakes
4.7 OPERATION LAYOUT
 4.8 PRODUCTION PLANNING

Production planning is important to make sure that our business is able to produce outputs
that are enough to fulfil the expected market demand or sales. To achieve that, it needs to have a
good production planning. In production planning, the business will determine how much output to
be produced for a certain period of time such as in a day, a week or a month. The business may
need the information from the marketing plan, for example average sales forecast.

Calculation for output per day of cupcakes:

Average sales forecast per month = RM 439 880.40 ÷ 12

= RM 36 657.00

Price per unit = RM 5.90

Number of output per month = RM 36 657 ÷ 6

TOTAL = 6 110 units per month

Number of working days per month is 26 days. The amount of output to be produced per day is;

= 6 110 ÷ 26

= 235 units per day

If the effective working hour per day is 10 hours and 30 minutes, the total output produced per day
is;

= 235 ÷ 10.5

=22 units per hour

 4.9 LIST OF SUPPLIERS

SUPPLIERS ADDRESS

Harvestate Bakery Ingredients Sdn Bhd 23 Jalan U5/15 Seksyen U5 40150,

Shah Alam 40150, Selangor Darul Ehsan

Bagus @ Shah Alam 52 – 58, Jalan Rugbi 13/30, Seksyen 13,

40100 Shah Alam, Selangor Darul Ehsan

House of Ingredients No 19, Jalan Gangsa SD5/3F, Sri

Damansara, Kuala Lumpur
 4.10 LIST OF MACHINE AND EQUIPMENT

PRICE
TOTAL PRICE
ITEMS QUANTITY / UNIT
(RM
(RM)
FIXED ASSET

480.00 × 1

Refrigerator 2 4 000.00 × 1 4 480.00

Cash register 1 1 700.00 1 700.00

Mixer 2 120.00 × 2 240.00

 Trolley tray 1 550.00 550.00

Confectionary
1 5 300.00 5 300.00
showcase

Oven 2 350.00 × 2 700.00

 Stove 1 70.00 70.00

Kitchen and

baking 500.00 500.00

apparatus

Black light 3 25.00 × 3 75.00

Total 13 615.00
 PRICE / TOTAL
ITEMS QUANTITY UNIT PRICE

(RM) (RM

WORKING CAPITAL

Cupcake
200 0.3 × 200 60.00
boxes

Cleaning
50.00 50.00
utensils

Total 110.00
 4.11 RAW MATERIALS REQUIREMENT

AMOUNT OF AMOUNT AMOUNT

TOTAL
MATERIAL REQUIRED FOR REQUIRED / REQUIRED /
PRICE
100 CUPCAKES CUPCAKE MONTH

0.02kg / unit x RM
2 KG 0.02 KG
flour 2400 = 48kg 187.20

Tonic water 0.012 ɭ / unit x RM

1.2 litre 0.012 litre
2400 = 28.8 ɭ 115.20

0.03kg / unit x RM
3 KG 0.03 KG
Butter 2400 = 72kg 144.00

0.01kg / unit x
1 KG 0.01 KG RM 55.20
Caster sugar 2400 = 24kg

0.18 of an egg
( 2 eggs for 0.18 / unit x 2400 RM
18 units
Eggs every 10 = 432 units 129.60
cupcakes)
0.01kg/ unit x RM
Milk 1 litre 0.01 KG
2400 = 24kg 144.00
0.004 kg / unit x
0.04 KG 0.0004 KG RM 24.00
Baking powder 2400 = 9.6kg
0.25mɭ / unit x
25 millitre 0.25 millitre RM 43.20
Vanilla essence 2400 = 600 mɭ
0.01kg / unit x
Brown Sugar 1 KG 0.01 KG RM41.20
2400 = 24kg
Confectioner’s 0.028kg / unit x
2.8 KG 0.028 KG RM100.80
Sugar 2400 = 67.2kg
0.012ɭ / unit x
Water 1.2 litre 0.012 litre RM4.80
2400 = 28.8ɭ
 4.12 MANPOWER PLANNING

A. Organization Chart for Operation Department

Operations
Manager

Main Baker

Assistant Baker 1 Assistant Baker 2

Assistent Baker 2

B. List of Operation Personnel

Position No of personnel

Operations Manager 1

Main Baker 1

Assistant Bakers 3

TOTAL 5
C. Schedule of task and responsibilities

POSITION TASK AND RESPONSIBILITIES

Operations Monitoring and analyzing the current system of

Manager production, working out a strategy for improving if

necessary and managing day to day activities .

Main Baker and Helping in the production process

Assistant Bakers
 4.13 BUSINESS AND WORKING HOURS

Staff Day Hours

Tuesday, Wednesday and Thursday Working Hours
10a.m. – 11p.m.
Business Hours
11a.m. – 10p.m.
Friday - Sunday Working Hours
9a.m. – 10p.m.
Business Hours
10a.m. – 10p.m.
Break Hour (by shift) 12.00p.m. – 1.00p.m.
7.00p.m. – 8.00p.m

Off-day

Monday – Off Day

Tuesday – Operation Executive & Manager

Wednesday – Administration Executive

Thursday – Financial Executive

Friday – Marketing Executive

4.14 OVERHEADS REQUIREMENTS

ITEM COST / MONTH (RM)

Electricity RM 230

Water RM 35

Machine maintenance RM 150

TOTAL RM 415
 4.15 LOCATION PLAN

We have chosen the location fo our business at Shah Alam, Selangor. The main reason why we
choose this place is because it is located near the residential area. It is easy for our workers to
come to work on time. In addition, Shah Alam is a strategic place because it is one of the places
that is famously known for food heaven. Besides, this location is an attraction place to the tourists
since it is located at the city. Furthermore, the location is also surrounded by colleges and
universities. With all the reasons that we stated above, it shows that the location of our business is
a strategic location.

Location Address and Maps

Lot LS21, Jalan Akuatik 13/64, Persiaran Akuatik, 40200, Shah Alam, Selangor
 4.16 OPERATIONS BUDGET

Item Fixed Monthly Other Total

Assets Expenses Expenses (RM)
(RM) (RM) (RM)

Fixed Asset
Machines and 13 615.00 13 615.00
equipment
Working Capital
 Packaging 60.00 1 019.20
 Raw materials 959.20
Other Expenses
 Machine 150.00 200.00
maintenance 50.00
 Cleansing
utensils
TOTAL 13 615.00 1 169.20 50.00 14 834.20
 4.17 Project Implementation Schedule

Activities Deadlines Durations

Incorporation of business August 2013 2 weeks

Application for permits and

August 2013 2 weeks
license

Searching for business premise September 2013 1 month

Renovation of premise October 2013 1 month

Procurement of machines and

October 2013 1 month
raw material

Recruitment of labours November 2013 1 week

 4.18 Licence, permits and regulations

In order to operate the business, The Baking Fairy needs to apply the following license,
permits and regulations:

i. Business registration from Suruhanjaya Syarikat Malaysia (SSM).

ii. Halal Certificate from JAKIM.

iii. Mesti Certificate from Kementerian Kesihatan Malaysia (KKM)

 4 OGOS 2019

4 OGOS 2013
3 TAHUN
5.1 INTRODUCTION

In general usage, a financial plan is a series of steps or goals used by an individual

business, the progressive and cumulative attainment of which are designed to accomplish final
financial goal or set of circumstances, elimination of debt, retirement preparation, etc. These often
include a budget which organize an individual’s finances and sometimes include a series of steps
or specific goals for spending and saving future income. These plans allocate future income to
various types of expenses, such as rent or utilities, and also reversed some income for short-term
and long-term savings.

Financial decision making involves all aspects of our lives, from basic decision on
household spending a complex dealing of a big business or a corporation. There are financial
implications in almost all business decisions, and even none financial executives must know
enough finance to be able to execute their duties effectively and efficiently. The understanding and
comprehension of financial decision making tools and its relationships with other business function
are essential to aid decision makers in deciding the optimal investment that could provide
maximum return to the firm. A financial plan sometimes refers to an investment plan, which
allocate saving to various assets or projects expected to future income, such as a new business or
product line, shares in an existing business or real estate.

Therefore, the fundamental of finance will cover the basic theories and procedures to
provide a wider understanding and appreciation of finance in general. Moreover, financial plan will
give some guidelines to organizations in order to know about their expenses and sources that will
be used. Other than that, a financial part will give the guideline to the other apart of business
function such as administration, marketing, and also operational plan in order to allocate the
appropriate budget in certain activities. Thus, the financial plan is the final step in the preparation
of business plan. It is the most crucial aspect of the business plan and involves determining to the
project cost, choice of sources of financing and preparation of financial projections in term of pro
forma statements, which include cash flow, income statement and balance sheet. In addition, the
financial plan should be supported by depreciation schedule for every fixed asset owned as well
as amortization schedules for loan and higher purchase repayment. The financial plan is prepared
after all budgets pertaining to marketing, operations and operating budget are completed.
5.2 IMPORTANCE OF FINANCIAL PLAN

The importance of financial plan in an organization can be seen in how the cash flows in and
out of the business. Every decision regarding business activity in Tri-Tapioca can be monitored
properly if good financial plan is devised in advance. The following points shows how importance
financial planning in an organization:

 To identify relevant sources of financial.

 Determining what should be done to generate cash flow in order to make possible
investment.

 To identify opportunities in investment relevant to the financial situation.

We can use financial planning in order to evaluate the best investment opportunities.

 To see what expenditures need to be made to keep the company move forward and one
step ahead of competitor.

 Act as a guideline for project implementation.

 To build strong capital.

5.3 PROCESSS OF DEVELOPING FINANCIAL ANALYSIS

STEP 1 : GATHER ALL FINANCIAL INPUTS.

STEP 2 : PREPARE THE PROJECT IMPLENTATION COST

SCEDULE.

STEP 3 : PREPARE THE SOURCES OF FINANCE SCEDULE.

STEP 4 : PREPARE THE PRO-FORMA CASH FLOW

STATEMENT.

STEP 5 : PREPARE THE PRO-FORMA CASH STATEMENT.

STEP 6 : PREPARE THE PRO-FORMA BALANCE SHEET.

STEP 7 : PERFORM FINANCIAL ANALYSIS BASED ON THE

ABOVE PRO-FORMA STATEMENT.
5.4 SOURCE OF FINANCIAL INFORMATION

Financial information is gathered through these budgets:

Administrative Budget Marketing Budget

-Payroll -Payroll

-Fixtures and Fittings cost -Sales Forecast

-Office and Equipment cost -Promotional cost

-Other Administration cost -Other Marketing cost

Financial Budget
Operation Budget
-Project Implementation cost
-Direct Labour
-Source of Financing
-Direct Material
-Cash Flow Statement
-Machinery and Equipment cost
-Income Statement
-Other Operation cost
-Balance Sheet
5.5 OPERATING BUDGET

i. Administrative department

ITEM ASSET MONTHLY OTHER PRE TOTAL

EXPENSES EXPENSES EXPENSES OPERATING (RM)
(RM) (RM) (RM) (RM)
Fixed asset
Office Equipment & 4 604.00 4 604.00
Furniture
Second-hand van 9 800.00 9 800.00
Machine 5 000.00 5 000.00
Working capital
Rent 2 500.00 2 500.00
Salary 13 908.00 13 908.00
EPF (13% and 10%) 1 964.00 1 964.00
SOCSO (1.75% and 228.00
228.00
0.5%)
Bill : Water 35.00 35.00
Bill : Electricity 230.00 230.00
Bill : Internet Wi-Fi & 100.00
100.00
Telephone
Pre-operating expenses

Business Registration 60.00 60.00

Fees

License of Business 50.00 50.00

Fees
Halal Certification 100.00 100.00
License of Fire 10.00 10.00
Extinguisher
First Aid Kit 50.00 50.00
TOTAL 19 404.00 18 965.00 50.00 220.00 28 839.00
 ii. Marketing Department

Item Fixed Assets Monthly Other TOTAL

Expenses Expenses (RM)
(RM) (RM)

Fixed Asset

Signboard 1400.00 1400.00

Other Expenses

Business card 100.00 100.00

(0.20 x 500)

Bunting 80.00 80.00

Flyers 200.00 200.00

(0.10 x 1000)

Grand opening 1 200.00 1 200.00

TOTAL 1400 200.0 1 580.00 2 980.00

iii. Operation Department

Item Fixed Monthly Other Total

Assets Expenses Expenses (RM)
(RM) (RM) (RM)

Fixed Asset
Machine and 13 615.00 13 615.00
equipment
Working Capital
 Packaging 60.00 1 019.20
 Raw materials 959.20
Other Expenses
 Machine 150.00 200.00
maintenance
 Cleansing 50.00
utensils
TOTAL 13 615.00 1 169.20 50.00 14 834.20
 THE BAKING FAIRY
CURRENT FINANCIAL POSITION

Estimated Economic
Existing Capital Expenditure Book Value (RM)
Life (years)

Administrative/Organisation/Marketing
Land & Building
OFFICE EQUIPMENTS AND FURNITURES 4,604 10
SECONDHAND VAN 9,800 7
MACHINES 5,000 10
5
5
5
5
5
Operations/Technical
MACHINES AND EQUIPMENTS 13,615 8
MACHINE MAINTENANCE 150 5
5
5
Total 33,169

ASSETS
Non-Current Assets (Book Value)
Land & Building -
Other Fixed Assets 33,169
Other Non-Current Assets 1,400
Deposit 2,500
Current Assets
Inventory: Raw Materials 959
Inventory: Work-in-Progress 60
Inventory: Finished Goods
Accounts Receivable
Cash Balance
Other Current Assets
TOTAL ASSETS 38,088
OWNERS' EQUITY & LIABILITIES
Owners' Equity
Capital 72,000
Accumulated Income (69,531)

Long-Term Liabilities
Loan Balance 25,819
Hire-Purchase Balance 9,800
Current Liabilities
Accounts Payable
Other Current Liabilities
TOTAL EQUITY & LIABILITIES 38,088
THE BAKING FAIRY
Estimated Economic
Types of Capital Expenditure Estimated Cost (RM)
Life (years)
Administrative/Organisation/Marketing
Land & Building
OFFICE EQUIPMENTS AND FURNITURES 4,604 10
SECONDHAND VAN 9,800 6
MACHINES 5,000 10
SIGNBOARD 1,400 10
5
5
5
5
Operations/Technical
MACHINES AND EQUIPMENTS 13,615 10
5
5
5
Total 34,419
Depreciation method
Garis lurus
THE BAKING FAIRY

Pre-Operating & Incorporation Costs (one-off) RM

Development cost
Business incorporation 1,500
Deposit (rent, utilities, etc.) 2,500
Other pre-operating & incorporation costs 50
Sales & Marketing Costs (monthly)
FLYERS 200

General & Administrative Costs (monthly)

Salaries, Wages, EPF & SOCSO 11,800
UTILITIES 365

Operations & Technical Costs (monthly)

Purchase of Raw Materials/Goods: Main Materials/Goods 959
Purchase of Raw Materials/Goods: Materials/Goods 1
Purchase of Raw Materials/Goods: Materials/Goods 3
Carriage Inwards
Salaries, Wages, EPF & SOCSO 4,300
PACKAGING 60

Other Expenditure (annually)

CLEANSING UTENSILS 50
BUSINESS CARD 100

Total Pre-Operations & Working Capital Expenditure 21,884

Annual Increase in Working Capital (if any)

2015 1%
2016 1%
2017 2%
2018 2%

Tax Rates
2014 20%
2015 20%
2016 20%
2017 20%
2018 20%
 THE BAKING FAIRY

MONTHLY SALES FORECAST (RM)

Products Types/Groups Product 1 Product 2 Product 3 Product 4 Product 5
Monthly Sales (RM) 36,657

PROJECTED INCREASE IN ANNUAL SALES (%)

Year 2015 2016 2017 2018
% Increase in Annual Sales 1.5% 2.0% 2.5% 4.0%

PROJECTED INCREASE IN ANNUAL PURCHASES (%)

Year 2015 2016 2017 2018
% Increase in Annual Purchases 0.5% 0.5% 1.0% 1.0%

SALES PROJECTIONS RM PURCHASE PROJECTIONS RM

January 2014 36,657 January 2014 959
February 2014 36,657 February 2014 959
March 2014 36,657 March 2014 959
April 2014 36,657 April 2014 959
May 2014 36,657 May 2014 959
June 2014 36,657 June 2014 959
July 2014 36,657 July 2014 959
August 2014 36,657 August 2014 959
September 2014 36,657 September 2014 959
October 2014 36,657 October 2014 959
November 2014 36,657 November 2014 959
December 2014 36,657 December 2014 959
Total 2014 439,884 Total 2014 11,510
Total 2015 446,482 Total 2015 11,568
Total 2016 455,412 Total 2016 11,626
Total 2017 466,797 Total 2017 11,742
Total 2018 485,469 Total 2018 11,859

SALES COLLECTIONS PURCHASE PAYMENTS

In the month of sales 100% In the month of purchase 100%
One month after sales 0% One month after purchase 0%
Two months after sales 0% Two months after purchase 0%

ENDING INVENTORY OF FINISHED GOODS & WORK-IN-PROGRESS ENDING INVENTORY OF RAW MATERIALS
Estimated % of Inventory on Sales 0.5% Estimated % of Inventory on Purchases 0.5%
End of 2014 2,199 End of 2014 58
End of 2015 2,232 End of 2015 58
End of 2016 2,277 End of 2016 58
End of 2017 2,334 End of 2017 59
End of 2018 2,427 End of 2018 59
THE BAKING FAIRY

Capital Expenditure Cost Sources of Financing

Land & Building Cash
OFFICE EQUIPMENTS AND FURNITURES 4,604 Loan
SECONDHAND VAN 9,800 Hire-purchase
MACHINES 5,000 Loan
SIGNBOARD 1,400 Loan
Cash
Cash
Cash
Cash
MACHINES AND EQUIPMENTS 13,615 Loan
Cash
Cash
Cash
Working Capital 1 months
Sales & Marketing Costs (monthly) 200 Cash
General & Administrative Costs (monthly) 12,165 Cash
Operations & Technical Costs (monthly) 5,319 Cash
Pre-Operating & Incorporation Costs (one-off) 4,050 Cash
Other Expenditure (annually) 150 Cash
Provision for Contingencies Cash
TOTAL 56,303
THE BAKING FAIRY

Own Contributions
Capital Expenditure Cost Loan Hire-Purchase
Cash Existing F. Assets
Land & Building -
OFFICE EQUIPMENTS AND FURNITURES 4,604 4,604
SECONDHAND VAN 9,800 9,800
MACHINES 5,000 5,000
SIGNBOARD 1,400 1,400
-
-
-
-
MACHINES AND EQUIPMENTS 13,615 13,615
-
-
-
Working Capital
Sales & Marketing Costs (monthly) 200 200
General & Administrative Costs (monthly) 12,165 12,165
Operations & Technical Costs (monthly) 5,319 5,319
Pre-Operating & Incorporation Costs (one-off) 4,050 4,050
Other Expenditure (annually) 150 150
Provision for Contingencies -
TOTAL 56,303 21,884 24,619 9,800

Proposed Terms of Loan (if required) Proposed Terms of Hire-Purchase (if required)

Annual interest rate 6% Annual interest rate 2%

Loan period (years) 20 Period (years) 8
 THE BAKING FAIRY

2012 MONTHLY CASH FLOW

2012 2013 2014 2015 2016
MONTH Pre-Operations January February March April May June July August September October November December

CASH INFLOW

Capital (Cash) 21,884 21,884 0 0

Loan 24,619 24,619 0 0

Cash Sales 36,657 36,657 36,657 36,657 36,657 36,657 36,657 36,657 36,657 36,657 36,657 36,657 439,884 444,283 453,168 464,498 483,078
Collection of Accounts Receivable 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0

TOTAL CASH RECEIPT 46,503 36,657 36,657 36,657 36,657 36,657 36,657 36,657 36,657 36,657 36,657 36,657 36,657 486,387 444,283 453,168 464,498 483,078

CASH OUTFLOW

Pre-operating & Incorporation Expenditure 4,050 4,050

Sales & Marketing Expenditure 200 200 200 200 200 200 200 200 200 200 200 200 2,400 2,400 2,400 2,400 2,400
General & Administrative Expenditure 12,165 12,165 12,165 12,165 12,165 12,165 12,165 12,165 12,165 12,165 12,165 12,165 145,980 145,980 145,980 145,980 145,980
Operations & Technical Expenditure 5,319 5,319 5,319 5,319 5,319 5,319 5,319 5,319 5,319 5,319 5,319 5,319 63,828 63,886 63,943 64,060 64,177
Other Expenditure 150 150 150 150 150 150
Purchase of Fixed Assets 24,619 24,619 - - - -
Hire-Purchase Repayment:
Principal 204 204 204 204 204 204 204 204 204 204 204 204 2,450 2,450 2,450 2,450 2,450
Interest 33 33 33 33 33 33 33 33 33 33 33 33 392 392 392 392 392
Loan Repayment:
Principal 181 181 181 181 181 181 181 181 181 181 181 181 2,167 2,297 2,435 2,581 2,736
Interest 252 252 252 252 252 252 252 252 252 252 252 252 3,026 2,896 2,758 2,612 2,458
Tax Payable 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
TOTAL CASH OUTFLOW 28,669 18,504 18,354 18,354 18,354 18,354 18,354 18,354 18,354 18,354 18,354 18,354 18,354 249,062 220,451 220,509 220,625 220,742
CASH SURPLUS (DEFICIT) 17,834 18,153 18,303 18,303 18,303 18,303 18,303 18,303 18,303 18,303 18,303 18,303 18,303 237,325 223,832 232,660 243,873 262,335
BEGINNING CASH BALANCE 0 17,834 35,987 54,291 72,594 90,898 109,201 127,504 145,808 164,111 182,415 200,718 219,021 0 237,325 461,157 693,817 937,690
ENDING CASH BALANCE 17,834 35,987 54,291 72,594 90,898 109,201 127,504 145,808 164,111 182,415 200,718 219,021 237,325 237,325 461,157 693,817 937,690 1,200,025
 THE BAKING FAIRY
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER

2012 2013 2014 2015 2016

RM RM RM RM RM

CASH FLOWS FROM OPERATING ACTIVITIES

Net Income before tax 210,809 217,850 226,816 238,175 256,792
Adjustment for:
- Depreciation of fixed assets 10,729 10,729 10,729 10,729 10,729
- Interest expense 3,418 3,288 3,150 3,004 2,850
Operating profit before changes in working capital 224,957 231,867 240,695 251,908 270,371
(Increase)/decrease in inventories 1,019 - - - -
(Increase)/decrease in accounts receivable - - - - -
Increase/(decrease) in accounts payable - - - - -
Interest paid (3,418) (3,288) (3,150) (3,004) (2,850)
Tax paid - - - - -
(Increase)/decrease in other current assets -
Increase/(decrease) in other current liabilities - - - - -
Net cash from operating activities 222,558 228,579 237,545 248,904 267,521

CASH FLOWS FROM INVESTING ACTIVITIES

Purchase of property, plant & equipment (24,619) - - - -
(Increase)/decrease in other non-current assets (2,500) - - - -
Net cash used in investing activities (27,119) - - - -

CASH FLOWS FROM FINANCING ACTIVITIES

Increase in Share Capital 21,884 - - - -
Proceeds from long-term loans 24,619 (138) (146) (155) (164)
Repayment of long-term loans (2,167) (2,297) (2,435) (2,581) (2,736)
Repayment of hire-purchase (2,450) (2,450) (2,450) (2,450) (2,450)
Net cash from financing activities 41,886 (4,885) (5,031) (5,186) (5,350)

Net increase/(decrease) in cash 237,325 223,694 232,514 243,718 262,171

CASH AT THE BEGINNING OF THE YEAR - 237,325 461,157 693,817 937,690
CASH AT THE END OF THE YEAR 237,325 461,019 693,671 937,535 1,199,861
 ## 10,729
Net cash from
operating activities Net cash used in Net cash from
Cash balance
investing activities financing activities

2012 222558 (27119) 41886 237325

2013 228579 0 (4885) 461019
2014 237545 0 (5031) 693671
2015 248904 0 (5186) 937535
2016 267521 0 (5350) 1199861

2016

2015

2014

2013

2012

(200) 0 200 400 600 800 1000 1200 1400

Thousands
Cash balance
Net cash from financing activities
Net cash used in investing activities
Net cash from operating activities
 THE BAKING FAIRY
PRO-FORMA INCOME STATEMENT
FOR THE YEAR ENDED 31 DECEMBER

Years 2012 2013 2014 2015 2016

Sales 439,884 444,283 453,168 464,498 483,078
Less: Cost of Sales (Notes 1 & 2) 68,962 68,000 68,058 68,174 68,291
Gross Income 370,922 376,283 385,111 396,324 414,786

Expenditure
Pre-Operating & Incorporation Expenditure 1,550
General & Administrative Expenditure 145,980 145,980 145,980 145,980 145,980
Sales & Marketing Expenditure 2,400 2,400 2,400 2,400 2,400

Depreciation of Fixed Assets 6,615 6,615 6,615 6,615 6,615

Other Expenditure 150 150 150 150 150
Operating Income 214,228 221,138 229,966 241,179 259,642
Interest on Hire-Purchase 392 392 392 392 392
Interest on Loan 3,026 2,896 2,758 2,612 2,458
Net Income Before Tax 210,809 217,850 226,816 238,175 256,792
Income Tax 0 0 0 0 0
Net Income After Tax 210,809 217,850 226,816 238,175 256,792

Note 1
Cost of Sales
Opening Inventory of Finished Goods 60
Add: Total Production Cost (Note 2) 68,902 68,000 68,058 68,174 68,291
0
Less: Ending Inventory
68,962 68,000 68,058 68,174 68,291

Note 2
Raw Materials
Opening Inventory 959
Add: Current Year Purchases 11,508 11,566 11,623 11,740 11,857
Add: Carriage Inwards
Less: Ending Inventory
Raw Materials Used 12,467 11,566 11,623 11,740 11,857

Labour
Salaries, Wages, EPF & SOCSO 51,600 51,600 51,600 51,600 51,600

Factory Overhead
Depreciation of Fixed assets (Operations) 4,115 4,115 4,115 4,115 4,115
PACKAGING 720 720 720 720 720

Total Factory Overhead 4,835 4,835 4,835 4,835 4,835

Total Production Cost 68,902 68,000 68,058 68,174 68,291

 Total Expenditure
Total Sales Net Income

2012 439,884 229,075 210,809

2013 444,283 226,433 217,850
2014 453,168 226,353 226,816
2015 464,498 226,323 238,175
2016 483,078 226,286 256,792

2016

2015

2014

Net Income

Total Expenditure

2013 Total S ales

2012

RM0 RM200 RM400 RM600

Thousands
 THE BAKING FAIRY
PRO-FORMA BALANCE SHEET AS AT 31 DECEMBER

2012 2013 2014 2015 2016

ASSETS

Non-Current Assets (Book Value)

Land & Building
Other Fixed Assets 56,859 46,130 35,401 24,672 13,943
Other Non-Current Assets 1,400 1,400 1,400 1,400 1,400
Deposit 5,000 5,000 5,000 5,000 5,000
63,259 52,530 41,801 31,072 20,343
Current Assets
Inventory of Raw Materials
Inventory of Finished Goods & Work-in-Progress
Accounts Receivable
Cash Balance 237,325 461,157 693,817 937,690 1,200,025
Other Current Assets
237,325 461,157 693,817 937,690 1,200,025

TOTAL ASSETS 300,584 513,687 735,618 968,761 1,220,368

Owners' Equity
Capital 93,884 93,884 93,884 93,884 93,884
Accumulated Income 141,279 359,129 585,944 824,119 1,080,911
235,163 453,013 679,828 918,003 1,174,795
Long-Term Liabilities
Loan Balance 45,974 43,539 40,958 38,223 35,323
Hire-Purchase Balance 14,700 12,250 9,800 7,350 4,900
60,674 55,789 50,758 45,573 40,223
Current Liabilities
Accounts Payable
Loan Due Within Current Year 2,297 2,435 2,581 2,736 2,900
Hire-Purchase Due Within Current Year 2,450 2,450 2,450 2,450 2,450
Other Current Liabilities
4,747 4,885 5,031 5,186 5,350

TOTAL EQUITY & LIABILITIES 300,584 513,687 735,618 968,761 1,220,368

SUMMARY Total Assets Total Liabilities Total Equity

2012 300,584 60,674 235,163

2013 513,687 55,789 453,013
2014 735,618 50,758 679,828
2015 968,761 45,573 918,003
2016 1,220,368 40,223 1,174,795

2016

2015

2014 EQUITY
LIABILITY
ASET
2013

2012

RM- RM500 RM1,000 RM1,500

Thousands
 THE BAKING FAIRY

LIQUIDITY

Current Ratio Quick Ratio (Acid Test)

1 1
1 1
1 1
1 1
1 1
1 1
0 0
0 0
0 0
0 0 0 0 0 0 0 0 0 0 0 0
0 0
2014 2015 2016 2017 2018 2014 2015 2016 2017 2018

v Liquidity Ratio: The term liquidity refers to the availability of liquid assets to meet short-term obligations. Thus, liquidity ratios measure the ability of the
business to pay its monthly bills.The most widely used liquidity ratios are current ratio and quick ratio. Current ratio can be determined by dividing total current
assets by total current liabilities. Generally, this ratio shows the business’ ability to generate cash to meet its short-term obligations. Quick ratio, also known as the
acid test ratio, measures the extent to which current liabilities are covered by liquid assets. To determine quick ratio, the calculation of liquid assets does not take
into account inventrories since it is sometimes difficult to convert them into cash quickly.
 THE BAKING FAIRY

PROFITABILITY
Gross Profit Margin Net Profit Margin
51%
86% 86% 52%
86% 51%
85% 50%
85% 51% 50%
85%
85% 85% 85% 50%
85% 49%
50% 49%
85% 85%
85% 49%
85% 49%
85%
85% 48%
85% 48%
2014 2015 2016 2017 2018 2014 2015 2016 2017 2018

Return on Assets Return on Equity

90%
80% 70% 90%
70% 80%

60% 70%
60% 48%
50% 42%
50%
40% 30% 33%
40%
30% 24% 25%
20% 30% 21%
20% 20%
10% 10%
0% 0%
2014 2015 2016 2017 2018 2014 2015 2016 2017 2018

v Profitability ratios are important indicators of the business’ financial performance. Investors will particularly be interested in these ratios since they measure
the performance and growth potential of the business. Some of the commonly used profitability ratios are gross profit margin, net profit margin, return on assets
and return on equity. Gross profit margin give a good indication of financial health of the business. Without an adequate gross margin, the business will be unable
to pay its operating and other expenses. Gross profit margin is calculated by dividing the business gross income by sales. Net profit margin is an indication of how
effective the business is at cost control. The higher the net profit margin, the more effective the business is at converting sales into actual profit. Net profit margin
is calculated by dividing the business net income by sales. Return of assets measures the overall return that the business is able to make on its assets. This ratio is
derived by dividing the business net profit by total assets. Return of equity shows what the business has earned on its owners’ investment in the business. This ratio
is derived by dividing the business net profit by total equity.
 THE BAKING FAIRY

EFFICIENCY

Receivable Turnover Inventory Turnover

59
1 59
58 58
1 59
1 58
58
1
1 58
1 57 57
0 57
0
56
0
0 0 0 0 0 0 56
0 55
2014 2015 2016 2017 2018 2014 2015 2016 2017 2018

v The efficiency ratios measure how efficient the business uses its assets to generate sales. The most widely used efficiency ratio for planning purposes is
receivable turnover and inventory turnover ratios. Receivable turnover is the ratio of net credit sales of a business to its average accounts receivable during a
given period, usually a year. It is an activity ratio which estimates the number of times a business collects its average accounts receivable balance during a
period. Accounts receivable turnover is calculated using the following formula: Net Credit Sales/Average Accounts Receivable. Accounts receivable turnover
measures the efficiency of a business in collecting its credit sales. Generally a high value of accounts receivable turnover is favorable and lower figure may
indicate inefficiency in collecting outstanding sales. Increase in accounts receivable turnover overtime generally indicates improvement in the process of cash
collection on credit sales. Inventory turnover (or stock turnover) measures the number of times inventories have been converted into sales and indicates how
liquid the inventory is. All other things being equal, the higher the turnover figure, the more liquid the business is. This ratio divides the cost of sales (or cost of
goods sold) by the average value of inventory. The average value of inventory is derived by adding the opening and closing balance of and dividing the total by
two.
 THE BAKING FAIRY

FINANCIAL LEVERAGE
Debt to Equity Debt to Assets

30% 26% 25%

20%
25% 20%
20%
15%
13% 11%
15%
8% 10% 7%
10% 5%
5% 4%
4% 5%
5%

0% 0%
2014 2015 2016 2017 2018 2014 2015 2016 2017 2018

Time Interest Earned

92
100
84
79
70 74
80

60

40

20

0
2014 2015 2016 2017 2018

Financial Leverage (or gearing) is designed to help the entrepreneur measure the degree of financial risk that his business faces. By referring to this ratio, the entrepreneur can
assess his level of debt and decide whether it is appropriate for the business. The most commonly used leverageratios are total debt (liabilities) to equity (also known as
leverage or gearing), total debt to total assets, and times interest earned (also known as interest coverage). The total debt to equity ratio measures the percentage of the
business’ assets financed by creditors relative to the percentage financed by the owners. This ratio is calculated by dividing the the total debt by total equity. The debt to
asset ratio measures the percentage of the business’ assets financed by creditors relative to the percentage financed by the entrepreneur. This ratio is calculated by dividing
the total debts by total assets. Times interest earned ratio measures the number of times interest expense can be covered by profit before interest and tax. This ratio is
calculated by dividing total inte
## RM439,884 ANNUAL SALES
## RM446,482
## RM455,412
## RM466,797
## RM485,469
RM490,000 RM485,469

RM480,000

RM466,797
RM470,000

RM460,000 RM455,412

RM450,000 RM446,482

RM439,884
RM440,000

RM430,000

RM420,000

RM410,000

2014 2015 2016 2017 2018

 #REF!
ANNUAL INCOME

450,000
Gross Income
Operating Income Net Incopme After Tax
## RM219,024 215,606 RM219,024
## RM223,902 220,566 RM223,902
## 400,000
RM230,756 227,508 RM230,756
## RM237,940 234,784 RM237,940
## RM252,352 249,293 RM252,352
350,000

300,000

250,000 Gross Income

Operating Income
200,000 Net Incopme After Tax

150,000

100,000

50,000

0
2014 2015 2016 2017 2018

HOME
 YEAR-END FINANCIAL POSITION

RM1,400,000.00
TOTAL ASSETS & LIABILITIES (ACCUMULATED)

ASET LIABILITY EQUITY

RM1,200,000.00
2014 RM 306,175.85 RM 66,216.87 RM 239,958.98
2015 RM 522,838.01 RM 62,313.46 RM 460,524.55
2016 RM 746,355.06 RM 58,322.86 RM 688,032.20
2017
RM1,000,000.00 RM 977,055.97 RM 54,239.81 RM 922,816.15
2018 RM 1,222,168.09 RM 50,058.79 #############

RM800,000.00 ASET
LIABILITY

RM600,000.00 EQUITY

© 2013 Ismail Ab.Wahab MASMED UiTM

RM400,000.00

RM200,000.00

RM-
2014 2015 2016 2017 2018
 FINANCIAL PERFORMANCE

PAYBACK PERIOD FOR START-UP : Less than 1 year

INTERNAL RATE OF RETURN (IRR) : 400%

TIME TO BREAK-EVEN : Less than 1 year

 START-UP INFORMATION

60,000 56,303

50,000

40,000
34419

30,000

21884.2 24,619
20,000
21,884

10,000

Project Cost
Capital Expenditure
Operating
Expenditure Loan
Owners' Equity
 SOURCES OF#REF!
START-UP FINANCING

RM60,000 RM56,303
START-UP SUMMARY
Cash RM 21,884

RM50,000 Existing F. Assets RM -

Loan RM 24,619
Hire-Purchase RM 9,800
RM40,000
Total RM 56,303

RM30,000
RM24,619
RM21,884

RM20,000

RM9,800
RM10,000

RM-
RM-
Cash Existing F. Assets Loan Hire-Purchase Total