business plan for chocolate manufacturing pdf

Chocolate Factory Business Plan [Sample Template]

By: Author Tony Martins Ajaero

Home » Business Plans » Food Sector » Food Processing

Are you about starting a chocolate production company? If YES, here is a complete sample chocolate factory business plan template & FREE feasibility report.

Starting a chocolate factory/chocolate production company means that you want to come up with a product that can be consumed by all and sundry. Your product will consist of chocolate molded with candy, fruit, nut or granola; chocolate bars, plain, chocolate coatings, cocoa powder and cocoa butter, liquor and syrup.

The fact that you want your products to compete with similar products in the market place means that you will follow due process before pushing your product to the market. If you are certain that you have a winning formula and a product that meets all the requirements, then you should consider launching your own chocolate factory.

If you have decided to start a chocolate factory, then you should make sure that you carry out thorough feasibility studies and market survey. Business plan is yet another very important business document that you should not take for granted when launching your business. Below is a sample chocolate factory business plan that will help you successfully launch your own business.

A Sample Chocolate Factory Business Plan Template

1. industry overview.

Players in the Chocolate Production industry primarily engage in the processing of cacao beans, milk, sugar and other ingredients into chocolate-based confectionery, including chocolate bars and chocolate molded with nuts, fruit or granola. Industry products are then distributed to wholesalers, retailers and other intermediaries for resale to consumers.

If you are conversant with happenings in the chocolate production industry, you will agree that in time past, the industry has benefited from trends including improving disposable incomes and greater demand for premium chocolate.

However, other trends, including volatile cocoa and sugar prices and rising health consciousness, have limited industry growth. Chocolate is generally considered a discretionary good. As disposable income levels rise, demand for chocolate, particularly for premium products, increases.

However, consumers also indulge in chocolate in any economic circumstance, demonstrating the industry’s resilience to economic downfalls. Per capita disposable income is expected to increase in 2019, representing a potential opportunity for the industry.

The Chocolate Production industry is indeed a major sector of the economy of united states of America, Canada, Italy, France, United Kingdom , Ghana, South Africa, United Arab Emirates, Brazil, China and India et al.

Statistics has it that in the United States of America alone, the Chocolate Production industry generates over $19 billion annually from more than 3,556 registered and licensed chocolate production factories scattered all around the country. The industry is responsible for the employment of over 44,459 people.

Experts project the chocolate production industry to grow at a 2.1 percent annual rate between 2013 and 2018. Please note that the companies holding the largest market share in Chocolate Production in the US include Mars Inc., The Hershey Company, Ferrero Group and Chocoladefabriken Lindt & Sprungli AG.

A recent report published by IBISWorld projected the industry revenue to increase at an annualized rate of 2.0 percent over the five years to 2019, including growth of 1.4 percent in 2019. The barriers to entry in this industry are high, as the industry is dominated by the world’s most valuable and high-profile brands.

All over the world, the chocolate production industry is highly regulated because the devastating effect of fake chocolate can’t be quantified. As a matter of fact, there are several universal laws and regulations that govern the patenting, testing, safety, efficacy and marketing of products such as chocolate.

For example, in the United States, new chocolate and similar products must be approved by the Food and Drug Administration (FDA) as being both safe and effective before they can be allowed to go into the market.

If you are contemplating starting your own chocolate factory in the United States, you should ensure that you carry out a thorough market survey and feasibility studies. If you get some key factors wrong before starting your own chocolate production business, then you are likely going to struggle to stay afloat.

But over and above, chocolate factory business is a thriving and profitable business especially if you are creative and ready to take on the available market within the location where your business is plus the fact that Americans love chocolates and they are willing to try out different flavors.

2. Executive Summary

Queen Brownie® Chocolate Factory, Inc. is a licensed chocolate production company that will be located in Dallas-Fort Worth – Texas. We have been able to secure a long – term lease for a facility in a strategic location with an option of a long – term renewal on terms and conditions that are favorable to us.

The facility has government approval for the kind of production business we want to run, the facility is easily accessible. We are deliberate about that because we want easy movement of raw materials (raw cocoa, sugar and packaging containers) and finished products (chocolate).

Queen Brownie® Chocolate Factory, Inc. is in the chocolate production industry to produce chocolate molded with candy, fruit, nut or granola; chocolate bars, plain, chocolate coatings, cocoa powder; and cocoa butter, liquor and syrup. We are also in business to make profits and at the same to give our customers value for their money.

We are aware that there are several chocolate factories cum chocolate production companies scattered all around the United States whose products can be found all over the country, which is why we spent time and resources to conduct our feasibility studies and market survey so as to enable us locate the business in an area that can easily accept our products and brand.

We ensured that our facility is easy to locate and we have mapped out plans to develop a far – reaching distribution network all around Forth Smith – Texas and the United States of America.

Beyond producing quality chocolate products, our customer care is going to be second to none. We know that our customers are the reason why we are in business which is why we will go the extra mile to get them satisfied when they purchase our chocolate products.

Queen Brownie® Chocolate Factory, Inc. will ensure that all our customers (wholesale distributors) are given first class treatment whenever they visit our factory.

We have a CRM software that will enable us manage a one on one relationship with our customers (wholesale distributors) no matter how large they may grow to. We will ensure that we get our customers involved when making some business decisions that will directly or indirectly affect them.

Queen Brownie® Chocolate Factory, Inc. is family business that will be owned by Irene Dickson and her immediate family members.

Irene Dickson who is the Chief Executive Officer of the Company is a Graduate of Biochemistry and she holds a Master’s Degree in Business Management (MBA) from the University of California Berkley. She has over 15 years’ experience working in related industry as a director.

3. Our Products and Services

Queen Brownie® Chocolate Factory is going to run a standard chocolate factory whose products will not only be sold in Dallas-Fort Worth – Texas but also throughout the United States of America. These are some of the products that we will be offering;

• Chocolate molded with candy, fruit, nut or granola
• Chocolate bars, plain
• Chocolate coatings
• Cocoa powder
• Cocoa butter, liquor and syrup

4. Our Mission and Vision Statement

• Our vision is to establish a standard chocolate factory whose products will be not only be sold in Dallas-Fort Worth – Texas, but also throughout the United States of America, Canada and Mexico.
• Our mission is to establish a standard chocolate production Company/brand that in our own capacity will favorably compete with leaders in the industry. We want to build a business that will be listed amongst the top 20 chocolate brands in the United States of America.

Our Business Structure

Queen Brownie® Chocolate Factory, Inc. is established with the aim of competing favorably with other leading brands in the industry. This is why we will ensure that we put the right structure in place that will support the kind of growth that we have in mind.

We will make sure that we only hire people that are qualified, health – conscious, honest, hardworking, customer centric and are ready to work to help us build a prosperous business that will benefit all the stake holders.

As a matter of fact, profit-sharing arrangement will be made available to all our senior management staff and it will be based on their performance for a period of ten years or more depending how fast we meet our set target. In view of that, we have decided to hire qualified and competent hands to occupy the following positions;

• Chief Executive Officer (Owner)

Factory Manager

Human Resources and Admin Manager

Merchandize Manager

Sales and Marketing Manager

• Machine Operators
• Accountants / Cashiers

Distribution Truck Drivers

5. Job Roles and Responsibilities

Chief Executive Officer – CEO (Owner):

• Increases management’s effectiveness by recruiting, selecting, orienting, training, coaching, counseling, and disciplining managers; communicating values, strategies, and objectives; assigning accountabilities; planning, monitoring, and appraising job results.
• Creating, communicating, and implementing the organization’s vision, mission, and overall direction – i.e. leading the development and implementation of the overall organization’s strategy.
• Responsible for fixing prices and signing business deals
• Responsible for providing direction for the business
• Responsible for signing checks and documents on behalf of the company
• Evaluates the success of the organization.
• Responsible for overseeing the smooth running of the factory
• Part of the team that determines the quantity and quality of chocolate products that are to be produced
• Maps out strategy that will lead to efficiency amongst workers in the factory
• Responsible for training, evaluation and assessment of factory workers
• Ensures that the steady flow of raw materials to the chocolate factory and easy flow of finished products through wholesale distributors to the market
• Ensures operation of equipment by completing preventive maintenance requirements; calling for repairs.
• Ensures that the chocolate factory meets the expected safety and health standard at all times.
• Responsible for overseeing the smooth running of HR and administrative tasks for the organization
• Defining job positions for recruitment and managing interviewing process
• Carrying out staff induction for new team members
• Responsible for training, evaluation and assessment of employees
• Oversee the smooth running of the daily office and factory activities.
• Manage vendor relations, market visits, and the ongoing education and development of the organizations’ buying teams
• Responsible for the purchase of raw materials directly from farmers and packaging materials
• Responsible for planning sales, monitoring inventory, selecting the merchandise, and writing and pricing orders to vendors
• Ensures that the organization operates within stipulated budget.
• Manage 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
• Identify, prioritize, and reach out to new partners, and business opportunities et al
• Responsible for supervising implementation, advocate for the customer’s needs, and communicate with clients
• Develop, execute and evaluate new plans for expanding sales
• Document all customer contact and information
• Represent the company in strategic meetings
• Help increase sales and growth for the company

Accountant/Cashier

• Responsible for preparing financial reports, budgets, and financial statements for the organization
• Provides managements with financial analyses, development budgets, and accounting reports
• Responsible for financial forecasting and risks analysis.
• Performs cash management, general ledger accounting, and financial reporting
• Responsible for developing and managing financial systems and policies
• Responsible for administering payrolls
• Ensuring compliance with taxation legislation
• Handles all financial transactions for the organization
• Serves as internal auditor for the organization

Client Service Executive

• Welcomes guests and clients by greeting them in person or on the telephone; answering or directing inquiries.
• Ensures that all contacts with clients (e-mail, walk-In center, SMS or phone) provides the client with a personalized customer service experience of the highest level
• Through interaction with clients on the phone, uses every opportunity to build client’s interest in the company’s products and services
• Manages administrative duties assigned by the manager in an effective and timely manner
• Consistently stays abreast of any new information on the company’s products, promotional campaigns etc. to ensure accurate and helpful information is supplied to clients
• Receives parcels/documents for the company
• Distribute mails in the organization
• Handles any other duties as assigned by the line manager

Production Workers/Machine Operators:

• Operate machines such as evaporators, steamers and molds that are used in the production of chocolate treats.
• Assist in packaging and loading chocolate products into distribution trucks
• Assist in loading and unloading chocolate products
• Maintain a logbook of their driving activities to ensure compliance with federal regulations governing the rest and work periods for operators.
• Keep a record of vehicle inspections and make sure the truck is equipped with safety equipment
• Assist the transport and logistics manager in planning their route according to a delivery schedule.
• Local-delivery drivers may be required to sell products or services to stores and businesses on their route, obtain signatures from recipients and collect cash.
• Transport finished goods and raw materials over land to and from manufacturing plant or retail and distribution centers
• Inspect vehicles for mechanical items and safety issues and perform preventative maintenance
• Comply with truck driving rules and regulations (size, weight, route designations, parking, break periods etc.) as well as with company policies and procedures
• Collect and verify delivery instructions
• Report defects, accidents or violations

6. SWOT Analysis

We are quite aware that there are several chocolate production companies in the United States of America, which is why we are following the due process of establishing a business so as to compete favorably with them.

We know that if a proper SWOT analysis is conducted for our business, we will be able to position our business to maximize our strength, leverage on the opportunities that will be available to us, mitigate our risks and be well equipped to confront our threats.

Queen Brownie® Chocolate Factory, Inc. employed the services of an expert HR and Business Analyst with bias in startup business to help us conduct a thorough SWOT analysis and to help us create a Business model that will help us achieve our business goals and objectives. This is the summary of the SWOT analysis that was conducted for Queen Brownie® Chocolate Factory, Inc.;

Part of what is going to count as positives for Queen Brownie® Chocolate Factory is the vast experience of our management team, we have people on board who are highly experienced and who understand how to grow a business. So also, our closeness to several cocoa plantations, large national distribution network and of course our excellent customer service culture will definitely count as a strong strength for the business.

A major weakness that may count against us is the fact that we are a new chocolate factory and we don’t have the financial capacity to engage in the kind of publicity that we intend giving the business especially when big names like Mars Inc., The Hershey Company, Ferrero Group and Chocoladefabriken Lindt & Sprungli AG. et al are already determining the direction of the market.

• Opportunities:

From all projections from experts, one thing is certain, consolidation will boost market share concentration and profit margins despite volatile input costs.

As a result of that, we were able to conduct a thorough market survey and feasibility studies so as to position our business to take advantage of the existing market for chocolate products and also to create our own new market. We know that it is going to requires hard work, and we are determined to achieve it.

Aside from unfavorable government policies and economic impasse, a major threat that may likely confront us is the arrival of a new chocolate factory or related product manufacturing company in same location where ours is located or who might want to explore our market base.

7. MARKET ANALYSIS

• Market Trends

If you are conversant with the existing trend in the chocolate production industry, you will agree that despite the fact that there are competitions in different stages of the industry, most chocolate factories are leveraging on creativity in terms of packaging and marketing to continue to stay afloat in the industry.

In addition, the introduction of healthier chocolate products has helped producers secure growth. As a matter of fact, trade for the Chocolate Production industry depends in part on the value of the dollar relative to other currencies of other countries.

An appreciating dollar causes domestic goods to be relatively more expensive in foreign markets, hurting exports. It also heightens competition from imports. The trade-weighted index is expected to fall in 2019. However, the overall volatile nature of this driver poses a potential threat to the industry.

8. Our Target Market

When it comes to selling chocolate and candies et al, there is indeed a wide range of available customers. In essence, our target market can’t be restricted to just a group of people, but all those who resides in our target market locations.

In view of that, we have conducted our market research and we have ideas of what our target market would be expecting from us. We are in business to engage in wholesale distribution and to retail our chocolate to the following groups of people;

• Biscuits Manufacturers
• Cake and Confectioneries producers
• Finished Beverage Manufacturers
• Everybody in our target market location

Our competitive advantage

It is known fact that in the world of business, especially in recent time, the competition is on the ascending and in order to stay competitive you must be innovative and highly creative, hence we will continue to create new products in response to rising health consciousness.

Part of what is going to count as a competitive advantage for Queen Brownie® Chocolate Factory is the vast experience of our management team, we have people on board who are highly experienced and understand how to grow the business from the scratch to becoming a national phenomenon.

So also, our closeness to some of the largest cocoa plantations in Texas, our large and far reaching national distribution network and of course our excellent customer service culture will definitely count as a strong strength for the business.

Lastly, our employees will be well taken care of, and their welfare package will be among the best within our category in the chocolate production industry, meaning that they will be more than willing to build the business with us and help deliver our set goals and achieve all our aims and objectives.

We will also give good working conditions and commissions to freelance sales agents that we will recruit from time to time.

9. SALES AND MARKETING STRATEGIES

• Sources of Income

Queen Brownie® Chocolate Factory, Inc. is established with the aim of maximizing profits in the chocolate production industry and we are going to go all the way to ensure that we do all it takes to sell our chocolate products to a wide range of customers.

We will generate income by supplying the following products;

10. Sales Forecast

One thing is certain when it comes to chocolate factory, if your products are well – packaged and branded and if your production chocolate factory is centrally positioned and easily accessible, you will always attract customers cum sales and that will sure translate to increase in revenue generation for the business.

We have been able to examine the chocolate production industry, we have analyzed our chances in the industry and we have been able to come up with the following sales forecast.

• Below are the sales projections for Queen Brownie® Chocolate Factory, Inc., it is based on the location of our business and other factors as it relates to small scale and medium scale chocolate factory start – ups in the United States;
• First Fiscal Year: $550,000
• Second Fiscal Year: $1.3 Million
• Third Fiscal Year: $2.2 Million

N.B : This projection was done based on what is obtainable in the industry and with the assumption that there won’t be any major economic meltdown and there won’t be any major competitor offering same products and customer care services as we do within same location. Please note that the above projection might be lower and at the same time it might be higher.

• Marketing Strategy and Sales Strategy

Before choosing a location to start Queen Brownie® Chocolate Factory, Inc. and also the kind of chocolate products we produce, we conducted a thorough market survey and feasibility studies in order for us to be able to be able to penetrate the available market in our target market locations.

We hired experts who have good understanding of the industry to help us develop marketing strategies that will help us achieve our goal of winning a larger percentage of the available market in Dallas-Fort Worth – Texas and other cities in the United States of America.

In summary, Queen Brownie® Chocolate Factory, Inc. will adopt the following sales and marketing approach to sell our chocolate products;

• Introduce our chocolate brand by sending introductory letters to confectionaries ad cake producers, finished beverage manufacturers, residents, merchants, retailers and other stakeholders in Dallas-Fort Worth – Texas and other cities both in the United States of America
• Advertise our products in community – based newspapers, local TV and radio stations
• List our business and products on yellow pages ads (local directories)
• Leverage on the internet to promote our chocolate brands
• Engage in direct marketing and sales
• Encourage the use of Word of mouth marketing (referrals)

11. Publicity and Advertising Strategy

Queen Brownie® Chocolate Factory, Inc. has a long – term plan of distributing our chocolate products in various locations all around the United States of America, which is why we will deliberately build our brand to be well accepted first in Dallas-Fort Worth – Texas before venturing out. Here are the platforms we intend leveraging on to promote and advertise Queen Brownie® Chocolate Factory, Inc.;

• Place adverts on both print (community – based newspapers and magazines) and electronic media platforms
• Sponsor relevant community programs
• Leverage on the internet and social media platforms like; Instagram, Facebook, Pinterest, and twitter, et al to promote our chocolate brand
• Install our Billboards in strategic locations all around major cities in the United States of America, Canada and Mexico
• Engage in roadshows from time to time in targeted communities
• Distribute our fliers and handbills in target areas
• Position our Flexi Banners at strategic positions in the location where we intend getting customers to start patronizing our products.
• Ensure that our products are well branded and that all our staff members wear our customized clothes, and all our official cars and distribution vans are customized and well branded.

12. Our Pricing Strategy

We are aware of the pricing trend in the chocolate production industry which is why we have decided to produce various sizes and types of chocolate products.

In view of that, our prices will conform to what is obtainable in the industry but will ensure that within the first 6 to 12 months our chocolate products are sold a little bit below the average price of various chocolate brands in the United States of America.

We have put in place business strategies that will help us run on low profits for a period of 6 months; it is a way of encouraging people to buy into our chocolate brand.

• Payment Options

The payment policy adopted by Queen Brownie® Chocolate Factory, Inc. is all inclusive because we are quite aware that different customers prefer different payment options as it suits them but at the same time, we will ensure that we abide by the financial rules and regulation of the United States of America.

Here are the payment options that Queen Brownie® Chocolate Factory, Inc. will make available to her clients;

• Payment via bank transfer
• Payment with cash
• Payment via credit cards
• Payment via online bank transfer
• Payment via check

In view of the above, we have chosen banking platforms that will enable our client make payment for chocolate products purchase without any stress on their part. Our bank account numbers will be made available on our website and promotional materials.

13. Startup Expenditure (Budget)

Starting a standard chocolate factory is indeed a capital – intensive business because the amount required in setting up a chocolate factory is relatively much for a starter. The bulk of the startup capital will be spent on leasing or acquiring a facility and also in purchasing evaporating machine/steamer, sugar extractor, stirring tank, mold and sealing machines, a mini lab and good drainage system.

Aside from that, you also need to purchase distribution trucks, raw production materials, and paying of your employees and utility bills. These are the key areas where we will spend our startup capital;

• The total fee for registering the business in the United States of America – $750.
• Legal expenses for obtaining licenses and permits as well as the accounting services (software, P.O.S machines and other software) – $1,300 .
• Marketing promotion expenses for the grand opening of Queen Brownie® Chocolate Factory, Inc. in the amount of $3,500 and as well as flyer printing (2,000 flyers at $0.04 per copy) for the total amount of – $3,580.
• The cost for hiring Business Consultant – $2,500.
• The cost for insurance (general liability, workers’ compensation and property casualty) coverage at a total premium – $2,400.
• The cost for payment of rent for 12 months at $1.76 per square feet in the total amount of $110,300.
• The cost for construction of a standard chocolate factory – $230,000.
• Other start-up expenses including stationery ( $500 ) and phone and utility deposits ($2,500 ).
• Operational cost for the first 3 months (salaries of employees, payments of bills et al) – $100,000
• The cost for start-up inventory (evaporating machine / steamer, sugar extractor, stirring tank, molding machines, a mini lab and good drainage system, supply of raw cocoa, sugarcane, and packaging materials et al) – $100,000
• The cost for store equipment (cash register, security, ventilation, signage) – $13,750
• The cost of purchase of distribution vans – $60,000
• The cost for the purchase of furniture and gadgets (Computers, Printers, Telephone, Fax Machines, tables and chairs et al) – $4,000.
• The cost of launching a website – $600
• The cost for our opening party – $10,000
• Miscellaneous – $10,000

We would need an estimate of $500,000 to successfully set up our chocolate factory in Dallas-Fort Worth – Texas.

Generating Funds/Startup Capital for Queen Brownie® Chocolate Factory, Inc.

Queen Brownie® Chocolate Factory, Inc. is a family business that is owned and financed by Mrs. Irene Dickson and her immediate family members. They do not intend to welcome any external business partner which is why he has decided to restrict the sourcing of the startup capital to 3 major sources.

• Generate part of the startup capital from personal savings and sell of stocks
• Source for soft loans from family members and friends
• Apply for loan from the Bank

N.B: We have been able to generate about $200,000 ( Personal savings $150,000 and soft loan from family members $50,000 ) and we are at the final stages of obtaining a loan facility of $300,000 from our bank. All the papers and documents have been signed and submitted, the loan has been approved and any moment from now our account will be credited with the amount.

14. Sustainability and Expansion Strategy

The future of any business lies in the number of loyal customers that they have, the capacity and competence of their employees, their investment strategy and the business structure. If all of these factors are missing from a business (company), then it won’t be too long before the business close shop.

One of our major goals of starting Queen Brownie® Chocolate Factory, Inc. is to build a business that will survive off its own cash flow without the need for injecting finance from external sources once the business is officially running. We know that one of the ways of gaining approval and winning customers over is to retail our chocolate products a little bit cheaper than what is obtainable in the market and we are prepared to survive on lower profit margin for a while.

Queen Brownie® Chocolate Factory, Inc. will make sure that the right foundation, structures and processes are put in place to ensure that our staff welfare are well taken of. Our company’s corporate culture is designed to drive our business to greater heights and training and retraining of our workforce is at the top burner.

We know that if that is put in place, we will be able to successfully hire and retain the best hands we can get in the industry; they will be more committed to help us build the business of our dreams.

Check List/Milestone

• Business Name Availability Check : Completed
• Business Registration: Completed
• Opening of Corporate Bank Accounts: Completed
• Securing Point of Sales (POS) Machines: Completed
• Opening Mobile Money Accounts: Completed
• Opening Online Payment Platforms: Completed
• Application and Obtaining Tax Payer’s ID: In Progress
• Application for business license and permit: Completed
• Purchase of Insurance for the Business: Completed
• Leasing of facility and construction of standard chocolate factory: In Progress
• Conducting Feasibility Studies: Completed
• Generating capital from family members and friends: Completed
• Applications for Loan from the bank: In Progress
• Writing of Business Plan: Completed
• Drafting of Employee’s Handbook: Completed
• Drafting of Contract Documents and other relevant Legal Documents: In Progress
• Design of the Company’s Logo: Completed
• Printing of Packaging and Promotional Materials: In Progress
• Recruitment of employees: In Progress
• Purchase of the needed production machine and office equipment: In progress
• Creating Official Website for the Company: In Progress
• Creating Awareness for the business both online and around the community: In Progress
• Health and Safety and Fire Safety Arrangement (License): Secured
• Opening party/launching party planning: In Progress
• Establishing business relationship with vendors – wholesalers, cocoa and sugarcane farmers, suppliers and merchants: In Progress

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Chocolate Business Plan Template & Guidebook

If you are a chocolate craftsperson and have never written a business plan, you're at a disadvantage. You need to learn how to present your idea in a clear, compelling, organized and professional way — as this will open doors for financing and partnerships with potential producers or sellers. Whether you're starting a new chocolate business or planning to grow your existing business, we're confident our insights and suggestions will be valuable to you.

Get worry-free services and support to launch your business starting at $0 plus state fees.

• How to Start a Profitable Chocolate Business [11 Steps]
• 10+ Best & Profitable Chocolate Business Ideas [2023]
• 25 Catchy Chocolate Business Names:
• List of the Best Marketing Ideas For Your Chocolate Business:

How to Write a Chocolate Business Plan in 7 Steps:

1. describe the purpose of your chocolate business..

The first step to writing your business plan is to describe the purpose of your chocolate business. This includes describing why you are starting this type of business, and what problems it will solve for customers. This is a quick way to get your mind thinking about the customers’ problems. It also helps you identify what makes your business different from others in its industry.

It also helps to include a vision statement so that readers can understand what type of company you want to build.

Here is an example of a purpose mission statement for a chocolate business:

At [Chocolate Business Name], our purpose is to provide delicious and high-quality chocolate to our customers. We strive to offer a wide range of chocolate flavors and types to suit different tastes and preferences. We are committed to using the finest ingredients and techniques to ensure the best possible chocolate experience for our customers. Our mission is to bring joy and happiness to our customers through our delicious and satisfying chocolate. We aim to be the go-to destination for anyone looking to indulge in a tasty and indulgent treat.

2. Products & Services Offered by Your Chocolate Business.

The next step is to outline your products and services for your chocolate business. 

When you think about the products and services that you offer, it's helpful to ask yourself the following questions:

• What is my business?
• What are the products and/or services that I offer?
• Why am I offering these particular products and/or services?
• How do I differentiate myself from competitors with similar offerings?
• How will I market my products and services?

You may want to do a comparison of your business plan against those of other competitors in the area, or even with online reviews. This way, you can find out what people like about them and what they don’t like, so that you can either improve upon their offerings or avoid doing so altogether.

3. Build a Creative Marketing Stratgey.

If you don't have a marketing plan for your chocolate business, it's time to write one. Your marketing plan should be part of your business plan and be a roadmap to your goals. 

A good marketing plan for your chocolate business includes the following elements:

Target market

• Who is your target market?
• What do these customers have in common?
• How many of them are there?
• How can you best reach them with your message or product?

Customer base 

• Who are your current customers? 
• Where did they come from (i.e., referrals)?
• How can their experience with your chocolate business help make them repeat customers, consumers, visitors, subscribers, or advocates for other people in their network or industry who might also benefit from using this service, product, or brand?

Product or service description

• How does it work, what features does it have, and what are its benefits?
• Can anyone use this product or service regardless of age or gender?
• Can anyone visually see themselves using this product or service?
• How will they feel when they do so? If so, how long will the feeling last after purchasing (or trying) the product/service for the first time?

Competitive analysis

• Which companies are competing with yours today (and why)? 
• Which ones may enter into competition with yours tomorrow if they find out about it now through word-of-mouth advertising; social media networks; friends' recommendations; etc.)
• What specific advantages does each competitor offer over yours currently?

Marketing channels

• Which marketing channel do you intend to leverage to attract new customers?
• What is your estimated marketing budget needed?
• What is the projected cost to acquire a new customer?
• How many of your customers do you instead will return?

Form an LLC in your state!

4. Write Your Operational Plan.

Next, you'll need to build your operational plan. This section describes the type of business you'll be running, and includes the steps involved in your operations. 

In it, you should list:

• The equipment and facilities needed
• Who will be involved in the business (employees, contractors)
• Financial requirements for each step
• Milestones & KPIs
• Location of your business
• Zoning & permits required for the business

What equipment, supplies, or permits are needed to run a chocolate business?

To run a chocolate business, you will need the following:

• High-quality chocolate
• Chocolate molds or other equipment for shaping and decorating the chocolate
• Packaging materials, such as boxes, bags, and labels
• Refrigeration equipment to store and display the chocolate
• Business license (if required)
• Sales tax license (if required)
• Insurance (if required)
• Website or online presence to promote your business and attract customers
• Marketing materials (e.g. business cards)

In addition to these basic requirements, you may also want to invest in other equipment and supplies to help you create a wide range of chocolate products, such as different types of chocolate, flavorings, and decorations. You may also want to take classes or workshops to improve your chocolate-making skills and stay up to date with the latest techniques in the field.

5. Management & Organization of Your Chocolate Business.

The second part of your chocolate business plan is to develop a management and organization section.

This section will cover all of the following:

• How many employees you need in order to run your chocolate business. This should include the roles they will play (for example, one person may be responsible for managing administrative duties while another might be in charge of customer service).
• The structure of your management team. The higher-ups like yourself should be able to delegate tasks through lower-level managers who are directly responsible for their given department (inventory and sales, etc.).
• How you’re going to make sure that everyone on board is doing their job well. You’ll want check-ins with employees regularly so they have time to ask questions or voice concerns if needed; this also gives you time to offer support where necessary while staying informed on how things are going within individual departments too!

6. Chocolate Business Startup Expenses & Captial Needed.

This section should be broken down by month and year. If you are still in the planning stage of your business, it may be helpful to estimate how much money will be needed each month until you reach profitability.

Typically, expenses for your business can be broken into a few basic categories:

Startup Costs

Startup costs are typically the first expenses you will incur when beginning an enterprise. These include legal fees, accounting expenses, and other costs associated with getting your business off the ground. The amount of money needed to start a chocolate business varies based on many different variables, but below are a few different types of startup costs for a chocolate business.

Running & Operating Costs

Running costs refer to ongoing expenses related directly with operating your business over time like electricity bills or salaries paid out each month. These types of expenses will vary greatly depending on multiple variables such as location, team size, utility costs, etc.

Marketing & Sales Expenses

You should include any costs associated with marketing and sales, such as advertising and promotions, website design or maintenance. Also, consider any additional expenses that may be incurred if you decide to launch a new product or service line. For example, if your chocolate business has an existing website that needs an upgrade in order to sell more products or services, then this should be listed here.

7. Financial Plan & Projections

A financial plan is an important part of any business plan, as it outlines how the business will generate revenue and profit, and how it will use that profit to grow and sustain itself. To devise a financial plan for your chocolate business, you will need to consider a number of factors, including your start-up costs, operating costs, projected revenue, and expenses. 

Here are some steps you can follow to devise a financial plan for your chocolate business plan:

• Determine your start-up costs: This will include the cost of purchasing or leasing the space where you will operate your business, as well as the cost of buying or leasing any equipment or supplies that you need to start the business.
• Estimate your operating costs: Operating costs will include utilities, such as electricity, gas, and water, as well as labor costs for employees, if any, and the cost of purchasing any materials or supplies that you will need to run your business.
• Project your revenue: To project your revenue, you will need to consider the number of customers you expect to have and the average amount they will spend on each visit. You can use this information to estimate how much money you will make from selling your products or services.
• Estimate your expenses: In addition to your operating costs, you will need to consider other expenses, such as insurance, marketing, and maintenance. You will also need to set aside money for taxes and other fees.
• Create a budget: Once you have estimated your start-up costs, operating costs, revenue, and expenses, you can use this information to create a budget for your business. This will help you to see how much money you will need to start the business, and how much profit you can expect to make.
• Develop a plan for using your profit: Finally, you will need to decide how you will use your profit to grow and sustain your business. This might include investing in new equipment, expanding the business, or saving for a rainy day.

Frequently Asked Questions About Chocolate Business Plans:

Why do you need a business plan for a chocolate business.

A business plan is a document that outlines the goals and objectives of a business, as well as the strategies and tactics that will be used to achieve those goals. It is important to have a business plan for your chocolate business because it helps to focus the efforts of the company, communicate the business's goals and objectives to potential investors, and provide a roadmap for the business to follow. Additionally, a business plan can be used to help secure funding from investors or lenders, who will want to see that the business has a solid plan in place before they provide funding.

How to write a business plan for your chocolate business?)

To build a business plan for your chocolate business, start by researching your industry, competitors, and target market. Use this information to define your business's goals and objectives, as well as the strategies and tactics that you will use to achieve those goals. Next, create a financial plan that outlines your projected income, expenses, and profit. This should include a projected income statement, cash flow statement, and balance sheet. Once you have all of this information, you can use it to create a comprehensive business plan that outlines the goals and objectives of your business, as well as the strategies and tactics that you will use to achieve those goals. A well-written chocolate business plan contains the following sections: Purpose, Products & Services, Marketing Plan (including Marketing Strategy), Operations/Management Plan (including Operations/Management Strategy), Financial Plan (including Financial Forecasts), and Appendixes.

Can you write a chocolate business plan yourself?

Yes, you can write a chocolate business plan yourself. Writing a business plan is a valuable exercise that can help you clarify your business idea, identify potential challenges and opportunities, and develop a roadmap for success. While there are many resources and templates available to help you write a business plan, the process of creating one is ultimately up to you.

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I'm Nick, co-founder of newfoundr.com, dedicated to helping aspiring entrepreneurs succeed. As a small business owner with over five years of experience, I have garnered valuable knowledge and insights across a diverse range of industries. My passion for entrepreneurship drives me to share my expertise with aspiring entrepreneurs, empowering them to turn their business dreams into reality.

Through meticulous research and firsthand experience, I uncover the essential steps, software, tools, and costs associated with launching and maintaining a successful business. By demystifying the complexities of entrepreneurship, I provide the guidance and support needed for others to embark on their journey with confidence.

From assessing market viability and formulating business plans to selecting the right technology and navigating the financial landscape, I am dedicated to helping fellow entrepreneurs overcome challenges and unlock their full potential. As a steadfast advocate for small business success, my mission is to pave the way for a new generation of innovative and driven entrepreneurs who are ready to make their mark on the world.

How To Write a Business Plan for Chocolate Manufacturing in 9 Steps: Checklist

By henry sheykin, resources on chocolate manufacturing.

• Financial Model
• Business Plan
• Value Proposition
• One-Page Business Plan
• SWOT Analysis
• Business Model
• Marketing Plan
• Bundle Business Plan & Fin Model

Are you passionate about chocolate and dreaming of starting your own chocolate manufacturing business? You're in luck! The chocolate industry in the US is booming, with an annual growth rate of 3.1% and expected revenue of $25 billion by 2023 ( 1 ). One of the most successful business models in this industry is direct-to-consumer e-commerce sales, which allows chocolate companies to connect with customers through social media and digital marketing. In this blog post, we will guide you through the process of writing a business plan for your chocolate manufacturing venture in 9 simple steps.

Before diving into the details, it's important to conduct thorough market research to understand the current trends and demands in the chocolate industry. This will help you identify your target market and analyze your competition, ensuring that your business plan is tailored to meet the needs of your potential customers.

The next step is to define your business objectives and goals. What do you want to achieve with your chocolate manufacturing venture? Whether it's becoming the leading artisanal chocolate brand or expanding your business to international markets, clearly outlining your objectives will guide your decision-making process.

No business plan is complete without a thorough financial analysis. This step involves analyzing your costs, pricing your products, and projecting your revenue and expenses. It's essential to have a clear understanding of the financial viability of your chocolate manufacturing business.

Creating a concept and product strategy is crucial in a competitive industry like chocolate manufacturing. Identify what sets your products apart, whether it's using organic ingredients, unique flavors, or innovative packaging. Differentiate yourself from the competition and create a compelling brand story.

Once you have a solid foundation in place, it's time to determine the legal and regulatory requirements for starting a chocolate manufacturing business. This step ensures that you comply with food safety regulations, obtain necessary permits, and protect your intellectual property.

A strong marketing and sales plan is essential for attracting customers to your chocolate brand. Leverage social media and digital marketing platforms to showcase stunning visuals of your products and educate your audience about the chocolate-making process. Offer personalized experiences and a seamless shopping experience on your website to build customer loyalty.

Don't forget to outline your operational and supply chain logistics. This step involves setting up production facilities, sourcing high-quality ingredients, and establishing efficient distribution channels. Pay attention to details to ensure smooth operations.

Lastly, don't overlook the importance of conducting a risk assessment and developing mitigation strategies. Identify potential risks, such as supply chain disruptions or changing consumer preferences, and create contingency plans to minimize their impact on your chocolate manufacturing business.

By following these 9 steps, you will be well-equipped to write a comprehensive business plan for your chocolate manufacturing venture. Start planning today and turn your passion for chocolate into a successful business.

References:

1. Statista: "Chocolate Candy Market in the United States from 2017 to 2023" - https://www.statista.com/statistics/456909/us-chocolate-candy-market-size/

Conduct Market Research

Conducting thorough market research is a crucial step in creating a successful business plan for chocolate manufacturing. It helps you understand the industry landscape, identify potential customers, and assess the demand for your products. Here are some important aspects to consider when conducting market research:

• Identify your target market: Determine your ideal customers based on factors such as demographics, preferences, and buying behaviors. This will help you tailor your products and marketing strategies to attract and retain your target audience.
• Analyze the competition: Study your competitors to understand their strengths, weaknesses, and market position. This analysis will help you identify opportunities for differentiation and find your unique selling proposition.
• Assess market demand: Understand the current and projected demand for chocolate products. Research industry trends, consumer preferences, and market forecasts to evaluate the potential growth and profitability of your business.
• Identify potential distribution channels: Explore different channels through which you can sell your chocolate products, such as e-commerce platforms, local retailers, or specialty stores. Assess the pros and cons of each channel to determine the most effective strategy for reaching your target market.
• Engage with potential customers: Conduct surveys, interviews, or focus groups to gather insights from potential customers. This direct feedback will provide valuable information about their preferences, needs, and expectations, enabling you to refine your products and marketing strategies.

Tips for Conducting Market Research:

• Utilize online research tools, industry reports, and government databases to gather data and statistics about the chocolate market.
• Stay updated with emerging trends and changing consumer preferences by participating in industry conferences, trade shows, and networking events.
• Consider hiring a professional market research firm or engaging with consultants who specialize in the chocolate industry to gain in-depth insights and expertise.
• Regularly monitor and analyze your competitors' activities, including their product offerings, pricing strategies, and marketing campaigns.
• Keep an eye on external factors, such as economic trends, regulatory changes, and environmental concerns, which may impact the chocolate industry.

Identify Target Market And Competition

Identifying your target market and understanding the competitive landscape is crucial for the success of your chocolate manufacturing business. By defining your target market, you can tailor your products and marketing strategies to meet their specific needs and preferences. Additionally, analyzing your competition allows you to identify gaps in the market and differentiate yourself from other players.

Here are some important steps to follow in identifying your target market and competition:

• Conduct market research to gather demographic, psychographic, and behavioral data about potential customers. This will help you understand their preferences, buying habits, and motivations when it comes to purchasing chocolate products.
• Segment your target market based on common characteristics or needs. This will allow you to create specific marketing messages and product offerings for each segment.
• Analyze your competition by identifying existing chocolate manufacturers and retailers in your target market. Look at their product offerings, pricing strategies, marketing tactics, and customer reviews.
• Identify the unique selling propositions (USPs) of your competitors and determine how you can differentiate your business from them.
• Consider conducting a SWOT analysis (Strengths, Weaknesses, Opportunities, and Threats) to assess both your own business and your competitors. This will help you identify areas of opportunity and potential threats to your success.
• Use online tools and resources to gather market data and competitive insights.
• Engage with potential customers through surveys, focus groups, or social media to gather firsthand insights about their preferences and buying behaviors.
• Stay updated on industry trends and upcoming competitors to stay ahead of the competition.

By diligently identifying your target market and competition, you can position your chocolate manufacturing business for success and develop strategies that resonate with your customers.

Define Business Objectives And Goals

Defining clear and specific business objectives and goals is crucial for the success of your chocolate manufacturing business. These objectives and goals will serve as a roadmap, guiding your decision-making process and ensuring that everyone in your organization is working towards a common purpose.

When defining your business objectives and goals, it is important to consider both short-term and long-term aspirations. Short-term goals could include increasing sales by a certain percentage within the first year or establishing partnerships with local suppliers. Long-term goals might involve expanding into international markets or becoming a leading chocolate brand in your niche.

• Set SMART goals: Make sure your business objectives and goals are specific, measurable, achievable, relevant, and time-bound (SMART). This will help you track your progress and evaluate the success of your efforts.
• Align goals with your mission and values: Ensure that your objectives and goals are in line with your company's mission and values. This will help maintain consistency and build a strong brand image.
• Consider financial targets: Include financial targets in your goals, such as revenue projections, profit margins, and return on investment. This will help you monitor and manage your financial performance.
• Account for market trends and competition: Keep in mind the current market trends and competitive landscape when setting your objectives and goals. This will allow you to stay ahead of the competition and adapt to changing consumer demands.
• Involve key stakeholders: Seek input from your team members, partners, and advisors when defining your business objectives and goals. This will help ensure that everyone is aligned and committed to achieving them.
• Regularly review and update your goals: As your business evolves, it is essential to regularly review and update your objectives and goals to reflect new opportunities or challenges.

By clearly defining your business objectives and goals, you create a roadmap for success and provide direction for your chocolate manufacturing venture. This clarity will not only guide your decision-making process but also motivate and inspire your team to achieve greatness.

Conduct Thorough Financial Analysis

When starting a chocolate manufacturing business, conducting a thorough financial analysis is crucial for understanding the financial viability and sustainability of your venture. This step involves analyzing various financial aspects of your business, including costs, revenues, profit margins, and potential return on investment.

Here are some important considerations for conducting a thorough financial analysis:

• Determine startup costs: Calculate all the expenses involved in setting up your chocolate manufacturing business, including equipment, raw materials, packaging, marketing, and initial inventory. This will give you a clear understanding of the capital required to launch your venture.
• Assess ongoing costs: Identify and evaluate the recurring expenses that will be incurred on a regular basis, such as rent or lease payments, utilities, employee salaries, marketing expenses, and ingredient costs. Understanding these costs will help you forecast your cash flow and profitability.
• Analyze pricing and profit margins: Determine the appropriate pricing strategy for your chocolate products based on factors such as production costs, market demand, and competitor pricing. Calculate your profit margins to ensure they are sufficient to cover all expenses and generate a reasonable return on investment.
• Create financial projections: Develop detailed financial projections, including sales forecasts, cash flow statements, and income statements, for at least the first three years of your business. These projections will help you assess the financial health of your business and make informed decisions.
• Consider financing options: Evaluate different financing options available to you, such as traditional bank loans, crowdfunding, or seeking investors. Determine how much external funding you may need and explore the terms and conditions of each financing option.
• Understand break-even point: Calculate your break-even point, which is the minimum sales volume needed to cover all your costs. This will help you determine how much you need to sell in order to start making a profit.

Financial Analysis Tips:

• Hire a professional accountant or financial advisor to assist you with the financial analysis, especially if you are not familiar with accounting principles.
• Regularly monitor and analyze your financial statements to identify any trends, discrepancies, or areas for improvement.
• Keep track of your sales and expenses on a daily, weekly, and monthly basis to ensure accurate financial analysis.
• Consider conducting sensitivity analysis to assess how changes in various financial factors, such as pricing or costs, can impact your overall profitability.
• Periodically review and update your financial projections to reflect any changes in market conditions, costs, or business goals.

By conducting a thorough financial analysis, you will gain valuable insights into the financial feasibility of your chocolate manufacturing business. This analysis will guide your decision-making process and help you create a solid financial foundation for your venture.

Create A Concept And Product Strategy

Creating a strong concept and product strategy is crucial for the success of your chocolate manufacturing business. This step involves developing a clear vision of your brand, identifying your unique selling proposition, and determining the types of products you will offer.

Firstly, you need to define your brand concept, which encompasses the overall image and values you want your chocolate company to represent. Consider what sets your chocolates apart from the competition and what kind of experience you want to create for your customers. This will help you establish a strong brand identity and connect with your target market.

Next, you should identify your unique selling proposition (USP). What makes your chocolates different and desirable? Is it high-quality ingredients, unique flavor combinations, or a special production process? Clearly defining your USP will help you stand out in the saturated chocolate market and attract customers who are looking for something distinct.

Once you have established your brand concept and USP, it's time to determine the types of products you will offer. Consider your target market's preferences and the current trends in the chocolate industry. Will you focus on artisanal bars, truffles, or bonbons? Will you offer different flavors or incorporate organic and vegan options? It's essential to create a product lineup that aligns with your brand concept and meets the demands of your target market.

Tips for creating a concept and product strategy:

• Research the market to identify gaps and opportunities
• Seek feedback from potential customers to refine your product offerings
• Consider offering limited edition or seasonal products to create excitement
• Ensure your product lineup is diverse to cater to different tastes and dietary preferences
• Keep an eye on emerging trends in the chocolate industry and adapt accordingly

By creating a strong concept and product strategy, you will be able to differentiate yourself from competitors, attract your target market, and build a successful chocolate manufacturing business.

Determine Legal And Regulatory Requirements

When starting a chocolate manufacturing business, it is crucial to be aware of and comply with the legal and regulatory requirements that govern the industry. Failing to do so can result in serious consequences, including fines, penalties, or even the closure of your business.

Here are some important steps to follow in order to determine the legal and regulatory requirements for your chocolate manufacturing business:

• Research Industry-Specific Regulations: Begin by researching the specific legal and regulatory requirements that pertain to chocolate manufacturing. This may include food safety and labeling regulations, health and safety standards, product inspection requirements, and licensing or permits.
• Contact Local Authorities: Reach out to your local health department, food and drug administration, or any other relevant regulatory bodies to get information on specific permits, licenses, and certifications required for your chocolate manufacturing business.
• Food Safety Compliance: Ensure that your manufacturing processes and facilities meet the necessary food safety standards. This may involve implementing proper hygiene practices, establishing a Hazard Analysis Critical Control Point (HACCP) system, and conducting regular inspections.
• Labeling and Packaging Requirements: Familiarize yourself with the regulations regarding proper labeling and packaging of your chocolate products. This includes accurate ingredient lists, nutrition facts, allergen warnings, and any country or region-specific labeling requirements.
• Licensing and Permits: Determine if you need any specific licenses or permits to operate your chocolate manufacturing business. This might include a business license, a food service establishment permit, or a permit for operating machinery.
• Intellectual Property: If you plan to create unique recipes or develop your own brand, consider trademarking your business name, logo, and any other intellectual property to protect your rights and prevent others from infringing upon them.
• Insurance Coverage: It is important to obtain appropriate insurance coverage for your chocolate manufacturing business. This may include general liability insurance, product liability insurance, and equipment coverage to protect against potential risks and liabilities.
• Consult with an attorney or legal advisor familiar with the food industry to ensure compliance with all applicable legal and regulatory requirements.
• Stay updated on any changes or updates to the laws and regulations governing the chocolate manufacturing industry to maintain compliance.
• Establish a system for record-keeping to track and document your compliance efforts.
• Regularly review and audit your operations to identify and address any potential legal or regulatory risks that may arise.

Develop A Marketing And Sales Plan

A well-developed marketing and sales plan is essential for the success of a chocolate manufacturing business. It helps identify target customers, create effective strategies to reach them, and ultimately drive sales. Here are some important steps to consider when developing your marketing and sales plan:

• Identify your target customers: Clearly define your target market based on demographics, preferences, and buying behaviors. This will help you tailor your marketing efforts and messaging to effectively reach and connect with your ideal customers.
• Define your unique selling proposition (USP): Determine what sets your chocolate products apart from the competition. Highlight the unique qualities, flavors, or ingredients that make your chocolates special, and use this as a key selling point in your marketing materials.
• Create a brand identity: Develop a strong and consistent brand image that aligns with your target market. This includes your brand name, logo, packaging design, and overall visual identity. Ensure that your brand conveys the quality and artisanal nature of your chocolates.
• Utilize digital marketing strategies: Leverage the power of social media platforms, such as Instagram and Facebook, to showcase your chocolates through visually appealing content. Engage with your audience by sharing behind-the-scenes footage, customer testimonials, and educational content about chocolate-making.
• Build an optimized website: Create a user-friendly and visually appealing website where customers can easily browse and purchase your chocolates. Include detailed product descriptions, high-quality images, and customer reviews to build trust and encourage conversions.
• Implement SEO strategies: Optimize your website for search engines by incorporating relevant keywords, meta tags, and descriptions. This will help improve your website's visibility in search engine results, driving organic traffic to your site.
• Develop partnerships: Collaborate with complementary businesses or influencers in the food and beverage industry to expand your reach and gain credibility. Consider partnering with local coffee shops, pastry stores, or lifestyle bloggers who can promote your chocolates to their audience.
• Offer special promotions or discounts on your website to encourage repeat purchases and customer loyalty.
• Participate in local events or food fairs to showcase your chocolates and engage with potential customers face-to-face.
• Collect customer data, such as email addresses, and use email marketing campaigns to nurture relationships and drive sales.
• Monitor and analyze your marketing efforts regularly to assess their effectiveness and make necessary adjustments to optimize results.

Outline Operational And Supply Chain Logistics

Once you have defined your business objectives and goals, it is crucial to outline the operational and supply chain logistics for your chocolate manufacturing business. This step involves determining how your production processes will be organized, identifying the equipment and resources needed, and establishing efficient supply chain management.

1. Production Processes: Start by mapping out the various stages involved in your chocolate manufacturing process. This may include sourcing quality cocoa beans, roasting and grinding, conching and refining, tempering and molding, and packaging. Consider the quantity of chocolate you plan to produce and the production capacity required to meet market demand.

2. Equipment and Resources: Identify the equipment, machinery, and tools needed to carry out each stage of the production process effectively. This may include cocoa bean grinders, conches, tempering machines, packaging equipment, and storage facilities. Ensure that your equipment is of high quality and meets industry standards.

3. Supply Chain Management: Create a detailed plan for managing your supply chain, from sourcing raw materials to delivering finished products to customers. Research and establish relationships with reliable suppliers of cocoa beans, sugar, milk, and other necessary ingredients. Consider the logistics of transporting raw materials to your manufacturing facility and distributing finished products to customers.

• Build strong relationships with suppliers to ensure a steady and reliable supply of raw materials.
• Consider alternative sourcing options to mitigate risks associated with supply chain disruptions.
• Implement robust inventory management systems to track and control your raw material and finished product inventory.
• Optimize your production process to ensure efficiency and minimize waste.
• Invest in quality control measures to maintain the consistency and quality of your chocolates.

By outlining your operational and supply chain logistics, you can ensure smooth and efficient production processes, minimize risks, and deliver high-quality chocolates to your customers. This step is essential to the overall success of your chocolate manufacturing business.

Conduct A Risk Assessment And Develop Mitigation Strategies

Conducting a risk assessment is a crucial step in ensuring the success and sustainability of your chocolate manufacturing business. By identifying potential risks and developing mitigation strategies, you can minimize the impact of unforeseen events and protect your business.

1. Identify potential risks: Start by identifying potential risks that could affect your chocolate manufacturing business. These risks could include supply chain disruptions, production delays, quality control issues, food safety and health regulations, or changes in consumer preferences.

2. Evaluate the likelihood and impact: Assess the likelihood and potential impact of each identified risk on your business operations. Rank these risks based on their severity, frequency, and the extent to which they could affect your business.

3. Develop mitigation strategies: Once you have identified and assessed the risks, develop effective mitigation strategies to minimize their impact. This could include diversifying your supplier base, implementing quality control measures, securing backup production facilities, or staying updated with regulatory requirements.

4. Implement risk management plan: Incorporate your risk mitigation strategies into your business plan and operational processes. Document your risk management plan and ensure that all relevant stakeholders are aware of their roles and responsibilities in managing risks.

Additional Tips:

• Regularly review and update your risk assessment to adapt to changing market conditions and business dynamics.
• Establish a contingency fund to address any financial impacts resulting from unforeseen events or disruptions.
• Stay informed about emerging trends, technologies, and regulations in the chocolate manufacturing industry to proactively address potential risks.
• Network and collaborate with other chocolate manufacturers and industry professionals to share best practices and gain insights into risk management strategies.

Conducting a risk assessment and developing mitigation strategies is an ongoing process that requires continuous monitoring and refinement. By proactively managing risks, you can safeguard the long-term success and growth of your chocolate manufacturing business.

Writing a business plan for chocolate manufacturing requires careful consideration of various factors, from market research to risk assessment. By following these 9 steps, you can create a comprehensive plan that will guide you through the process of setting up your chocolate manufacturing business.

Conducting market research and identifying your target market and competition will help you understand the demand and competition in the industry. Defining your business objectives and goals will give you a clear direction for your chocolate manufacturing venture.

A thorough financial analysis will enable you to determine the feasibility and profitability of your business. Creating a concept and product strategy will help you establish a unique selling proposition for your chocolates.

Understanding the legal and regulatory requirements will ensure that you comply with all the necessary guidelines and regulations. Developing a marketing and sales plan will help you promote your chocolates effectively and reach your target customers.

Outlining operational and supply chain logistics will ensure smooth production and delivery of your chocolates. Lastly, conducting a risk assessment and developing mitigation strategies will help you identify and address potential challenges and uncertainties.

By following these steps, you can lay a strong foundation for your chocolate manufacturing business and achieve success in the competitive market.

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Entrepreneurship General Awareness ACKNOWLEDGEMENT I would like to express my deepest appreciation to all those who provided me with the possibility to complete this report. I would like to convey special gratitude to our teachers, whose contribution in stimulating suggestions and encouragement, helped me coordinate my project especially in writing this report. Executive Summary We are starting a business of manufacturing and delivering chocolates. Name of the company is “Choco Fix”. Our target market is whole Delhi.The location of our manufacturing plant would be Delhi. We would be targeting the consumers of all age groups. The products that we would offer are all types of chocolates. Chocolate Truffles Dark Chocolate Peanut Butter Cups Dark Chocolate Walnuts Caramel Chocolate Popcorn Raspberry Chocolate Truffle Milk Chocolate Chocolate Bar The core competencies on which our company would be competing are taste and quality of our chocolates and delivering chocolates at the time customer wants them. Our comapny would be a partnership firm. There would be 2 finance managers, 1 marketing managers, 1 accountant and delivery boys. General Company Description Our company will be in the confectionary business. Our company will be involved in manufacturing and delivering chocolates. Vision Our vision is to be the leading manufacturer of chocolates all over India. Mission We seek to produce high quality products at competitive price using modern technology and to serve the customer at his doorstep to provide highest level of satisfaction. Objectives  To manufacture and provide the customers with the quality products to the best interest of the customers.  To create Price competitive Products as part of the effect to increase the world access to high quality chocolates.  To ensure a hygiene & clean working environment as to continue to produce Safe & Tasty Products  To strive to Meet & Exceed Customer's Expectations by delivering at their doorstep so as to ensure a sustainable business relationship. About Chocolate Industry The chocolate market is estimated around 33,000 tonnes valued at approximately Rs. 8 billion. Bars of moulded chocolates like amul, milk chocolate, dairy milk, truffle, nestle premium, and nestle milky bar comprise the largest segment, accounting for 37% of the total market in terms of volume. To push sales chocolate companies have been targeting mainly adult audiences. Chocolates are being presented as snack food for the new target audiences. The chocolate segment is characterized by high volumes, huge expenses on advertising, low margins, and price sensitivity Cadbury is the leading player in the chocolate market industry with the penetration of 70% market share. The company's brands like Five Star, Gems, Éclairs, Perk, and Dairy Milk are leaders in their segments. Nestle & Amul are the other major players in chocolate industry. Indian Chocolate Industry’s Margin range between 10 and 20%, depending on the price point at which the product is placed. The input costs in India are under check owing to the 24% decline in the prices of sugar. Core Competencies The core competencies on which our company will compete are:  Taste & Quality By consuming the “Chocofix Chocolates” flavor begins to fill your mouth the moment the chocolate begins to melt on your tongue like butter and it tastes like pure chocolate rather than cocoa powder. The raw ingredients are of finest quality and also care is taken of the production process; roasting and crushing the cocoa beans and mixing the cocoa paste with sugar and other ingredients such as milk.  Convenience Customers will be able to order “Chocofix” chocolates by just a click of a button, or a tap of their phone using our website and Android application. Users will be able to select Credit Card or Cash on Delivery as a mode of payment.  Perfect Gift for Every Occasion We all know how great of a gift chocolate makes for every occasion, what makes it even more perfect is “Chocofix” ensures delivery of your gift at whatever time the occasion demands for, be it midnight birthday or 4am craving, “Chocofix” is there for it all. Ownership Our company will be a partnership firm. Mixing Chocolate With IT We all know how tiring it could be to go to a store to pick up your favourite chocolate specially at odd hours. At Chocofix we understand this and to solve this problem, we aim to have a website as well as an Android / iPhone app where a user will be presented with our wide variety of chocolate products to chose and order from. We will provide online payment options as well as cash on delivery option. 24 Hour Delivery Since there are no companies that are currently delivering chocolates round the clock, we aim to make the most out of this opportunity. Many occassions and surprizes require delivery of gift at odd hours, thus we can tap a wide market by providing just a bit extra. Competitor Analysis COMPANY Nestle Ferrero Mars Amul Hershey’s FOUNDED IN BRAND PORTFOLIO 1860s 1940s (confectionery products) Kit Kat, Smarties, Wonka Rocher, Raffaello, Kinder, Tic Tac, 1911 Mon Cheri, Nutella Bounty, Galaxy, Mars, Snickers, 1945 Milky Way, Wrigley’s, M&M’s etc Milk chocolate, Fruit & Nut 1894 chocolate Hershey’s milk chocolate, Kisses, Pot of gold, Milk duds, Reese’s, Perfetti Van 2001, when Icebreakers etc Alpenliebe, Chlormint, Melle Perfetti and Van Centerfresh, Happydent, Mentos ITC melle merged 2002(confectioner Minto and Candyman Parle y segment) 1929 Melody, mango bite, poppins, kismi toffee, mazelo, xhale, éclair, Cadbury 1948 (Indian golgappa, parlelites, orange candy Dairy Milk, Dairy Milk fruit N nut, Market) Dairy Milk Shots, Dairy Milk Roasted Almond, Dairy Milk Silk Marketing Plan Economics Total size of chocolate market is 33000 tonnes Trends in Consumer Preferences  The range and variety of chocolates available in malls seems to be growing day by day, which leads to lot of impulse sales for chocolates companies.  Chocolates which use to be unaffordable is now considered midpriced.  Branded chocolates have become more popular.  Mithai is becoming the substitute of chocolates  Instead of buying sweets on Rakhshabhandan, Diwali, people prefer to buy chocolates. Barriers to entry     Huge startup costs Ensuring good quality products to the customers High Level of competition from the well established brands To keep price of the product low, as it is a price sensitive market Overcoming the barriers to entry  To overcome the barrier of huge start up costs our machinery would be taken for lease for first few years of business.  Marketing of our products would be on the basis good quality and healthy products and 24-hour delivery to provide a competitive advantage. Product From customer’s point of view, chocolate is the product which shows their impulse buying behavior. Customers are looking for low priced chocolates and also it should have good taste. Operational Plan Production The product will be manufactured by Full Automatic Chocolate Production Line (QH200), with this system, baking the moulds, depositing, forming etc. series procedure can be achieved automatically. It's available to depositing all shape of chocolate. Such as double color filled-inside, nuts etc chocolate. Since our product are plain as well as nut are added this machine is appropriate. This machine can produce 100-300 kg chocolates per hour. It can produce chocolates in different shapes .It can help to reduce cost of chocolates mould. By Producing Chocolates in different shapes we can attract all segments of market. The production capacity is fully automated as mentioned above, so the need of personnel is comparative less than other semi-automatic machine. Manufacturing process Chocolate production is highly sophisticated computer controlled process with much of the new specialist machinery. Machines like as chocolate cooling tunnels, enrobing machines, coating machines, moulding machines. Chocolate processing: Production flow of chocolate Cleaning When seeds arrive to factory they are carefully selected and cleaned by passing through a bean cleaning machine that removes extraneous materials. Different bean varieties are blended to produce the typical flavor of chocolate of particular producer. Then the bean shells are cracked and removed. Crushed cocoa beans are called nibs. Roasting The beans are then roasted to develop the characteristic chocolate flavor of the bean in large rotary cylinders. The roasting lasts from 30 minutes to 2 hours at very high temperatures. The bean colour changes to a rich brown and the aroma of chocolate comes through. Grinding The roasted nibs are milled through a process that liquefies the cocoa butter in the nibs and forms cocoa mass (or paste). This liquid mass has dark brown colour, typical strong smell and flavor and contains about 54% of cocoa butter. Cocoa Pressing Part of cocoa mass is fed into the cocoa press which hydraulically squeezes a portion of the cocoa butter from the cocoa mass, leaving "cocoa cakes". The cocoa butter is used in the manufacture of chocolates; the remaining cakes of cocoa solids are pulverized into cocoa powders. Mixing and Refining Ingredients, like cocoa mass, sugar, cocoa butter, flavorings and powdered or condensed milk for milk chocolate are blended in mixers to a paste with the consistency of dough for refining. Chocolate refiners, a set of rollers, crush the paste into flakes that are significantly reduced in size. This step is critical in determining how smooth chocolate is when eaten. Conching Conching is a flavour development process during which the chocolate is put under constant agitation. The conching machines, called "conches", have large paddles that sweep back and forth through the refined chocolate mass anywhere from a few hours to several days. Conching reduces moisture, drives off any lingering acidic flavors and coats each particle of chocolate with a layer of cocoa butter. The resulting chocolate has a smoother, mellower flavor. Tempering and Moulding The chocolate then undergoes a tempering melting and cooling process that creates small, stable cocoa butter crystals in the fluid chocolate mass and is deposited into moulds of different forms. Properly tempered chocolate will result in a finished product that has a glossy, smooth appearance. Cooling The moulded chocolate enters controlled cooling tunnels to solidify the pieces. Depending on the size of the chocolate pieces, the cooling cycle takes between 20 minutes to two hours. From the cooling tunnels, the chocolate is packaged for delivery to retailers and ultimately into the hands of consumers. Location Our manufacturing unit will be located in Adipur. Kandla Port and Mundra Port are also near to Adipur so it also helps in future, if we want Chocolates to be exported. Labour is easily available since there are many such labour contractor available in Gandhidham. We will get skilled and unskilled labour as per our need. Technical people are also available easily to monitor the quality and consistency of our product. Legal formalities:  We could get DIN (Director Identification Number) which is printed, signed, and sent to Ministry of Corporate Affairs.  Get a TAN (Tax Account Number) for income taxes from Income Tax Department’s Assessing Office.  We must be registered Enroll with Establishment Act (State/Municipal), Shops, and Office of Inspector.  We should also get food process order certificate from ministry of food processing industries and also doing as business certificate required for our chocolate industry. Personnel The machine is fully automatic so need of personnel is less. We need skilled worker for packaging and storage of our product. There would be a need of professional for checking and maintaining the quality of product. We also need a few IT men to develop and maintain a website and applications. Also, we’ll need a team of delivery guys equipped with good bikes to ensure on time delivery. “ A Balanced Diet Is Chocolate In Both Hands”

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A Business Plan For starting Yummy Chocolate Company Submitted By: Group 7

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Manufacturing Business Plan PDF Example

• May 7, 2024
• Business Plan

Creating a comprehensive business plan is crucial for launching and running a successful manufacturing business. This plan serves as your roadmap, detailing your vision, operational strategies, and financial plan. It helps establish your manufacturing business’s identity, navigate the competitive market, and secure funding for growth.

This article not only breaks down the critical components of a manufacturing business plan, but also provides an example of a business plan to help you craft your own.

Whether you’re an experienced entrepreneur or new to the manufacturing industry, this guide, complete with a business plan example, lays the groundwork for turning your manufacturing business concept into reality. Let’s dive in!

Our manufacturing business plan covers all essential aspects necessary for a comprehensive strategy. It details operations, marketing strategy , market environment, competitors, management team, and financial forecasts.

• Executive Summary : Provides an overview of the manufacturing company’s business concept, market analysis , management, and financial strategy.
• Facilities & Equipment: Describes the facility’s capabilities, machinery, and technological advancements.
• Operations & Supply: Outlines the production processes, supply chain logistics, and inventory management.
• Key Stats: Offers data on industry size , growth trends, and market positioning.
• Key Trends: Highlights significant trends impacting the industry, such as automation and localization.
• Key Competitors : Analyzes primary competitors and differentiates the company from these rivals.
• SWOT: Analyzes strengths, weaknesses, opportunities, and threats.
• Marketing Plan : Outlines tactics for attracting new contracts and maintaining client relationships.
• Timeline : Sets out key milestones from inception through the first year of operations.
• Management: Information on the management team and their roles within the company.
• Financial Plan: Projects the company’s financial performance over the next five years, detailing revenue, profits, and anticipated expenses.

Manufacturing Business Plan

Fully editable 30+ slides Powerpoint presentation business plan template.

Download an expert-built 30+ slides Powerpoint business plan template

Executive Summary

The Executive Summary introduces your manufacturing business plan, offering a concise overview of your manufacturing facility and its products. It should detail your market positioning, the range of products manufactured, the production process, its location, size, and an outline of day-to-day operations.

This section should also explore how your manufacturing business will integrate into the local and broader markets, including the number of direct competitors within the area, identifying who they are, along with your business’s unique selling points that differentiate it from these competitors.

Furthermore, you should include information about the management and co-founding team, detailing their roles and contributions to the business’s success. Additionally, a summary of your financial projections, including revenue and profits over the next five years, should be presented here to provide a clear picture of your business’s financial plan.

Make sure to cover here _ Business Overview _ Market Overview _ Management Team _ Financial Plan

Dive deeper into Executive Summary

Business Overview

Facilities & equipment.

Describe your manufacturing facility. Highlight its design, capacity, and technology. Mention the location, emphasizing accessibility to transport routes. Discuss advantages for efficiency and cost management. Detail essential equipment and its capabilities.

Operations & Supply Chain

Detail product range. Outline your operations strategy for efficiency and scalability. Discuss supply chain management. Highlight sourcing of materials, inventory control, and logistics. Emphasize strong partnerships with suppliers and distributors.

Make sure to cover here _ Facilities & Equipment _ Operations & Supplies

Market Overview

Industry size & growth.

Start by examining the size of the manufacturing industry relevant to your products and its growth potential. This analysis is crucial for understanding the market’s scope and identifying expansion opportunities.

Key Market Trends

Proceed to discuss recent market trends , such as the increasing demand for sustainable manufacturing processes, automation, and advanced materials. For example, highlight the demand for products that utilize eco-friendly materials or energy-efficient production techniques, alongside the rising popularity of smart manufacturing.

Key Competitors

Then, consider the competitive landscape, which includes a range of manufacturers from large-scale enterprises to niche firms. For example, emphasize what makes your business distinctive, whether it’s through advanced technology, superior product quality, or specialization in certain manufacturing niches. This section will help articulate the demand for your products, the competitive environment, and how your business is positioned to thrive within this dynamic market.

Make sure to cover here _ Industry size & growth _ Key competitors _ Key market trends

Dive deeper into Key competitors

First, conduct a SWOT analysis for your manufacturing business. Highlight Strengths such as advanced production technology and a skilled workforce. Address Weaknesses, including potential supply chain vulnerabilities or high production costs. Identify Opportunities like emerging markets for your products or potential for innovation in production processes. Consider Threats such as global competition or economic downturns that may impact demand for your products.

Marketing Plan

Next, develop a marketing strategy that outlines how to attract and retain customers through targeted advertising, trade shows, digital marketing, and strategic partnerships. Emphasize the importance of showcasing product quality and technological advantages to differentiate your business in the market.

Finally, create a detailed timeline that outlines critical milestones for your manufacturing business’s launch, marketing initiatives, customer acquisition, and expansion goals. Ensure the business progresses with clear direction and purpose, setting specific dates for achieving key operational and sales targets.

Make sure to cover here _ SWOT _ Marketing Plan _ Timeline

Dive deeper into SWOT

Dive deeper into Marketing Plan

The Management section focuses on the manufacturing business’s management and their direct roles in daily operations and strategic direction. This part is crucial for understanding who is responsible for making key decisions and driving the manufacturing business toward its financial and operational goals.

For your manufacturing business plan, list the core team members, their specific responsibilities, and how their expertise supports the business.

Financial Plan

The Financial Plan section is a comprehensive analysis of your financial projections for revenue, expenses, and profitability. It lays out your manufacturing business’s approach to securing funding, managing cash flow, and achieving breakeven.

This section typically includes detailed forecasts for the first 5 years of operation, highlighting expected revenue, operating costs and capital expenditures.

For your manufacturing business plan, provide a snapshot of your financial statement (profit and loss, balance sheet, cash flow statement), as well as your key assumptions (e.g. number of customers and prices, expenses, etc.).

Make sure to cover here _ Profit and Loss _ Cash Flow Statement _ Balance Sheet _ Use of Funds

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Business Plan for Starting a Chocolate Company

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• 1. A Business Plan For starting Yummy Chocolate Company Submitted By: Group 7 LeenaChellani (11015) NikunjGajara (11046) ChandanPahelwani (11047) Jay Pujara (11060) RinkuSalat (11068) DivyaDhawani (10029) Submitted To: Prof. SushilChaurasia Tolani Institute of Management Studies Page 1
• 2. Executive Summary We are starting a business of manufacturing chocolates. Name of the company is “Yummy Chocolate”.Our target market is whole Gujarat. The customers to whom our products will be supplied are retailers, wholesalers and traders in Gandhidham, Adipur, Rajkot, Ahmedabad, Surat and Vadodara.The location of our manufacturing plant would be GIDC, Adipur. We would be targeting the consumers of all age groups. The products that we would offer are:  Yummy Plain Chocolate  Yummy Milk Chocolate  Yummy Fruit N Nut Chocolate The core competencies on which our company would be competing are taste and quality of our chocolates. Our comapny would be a partnership firm. There would be 2 finance managers, 2 marketing managers, 1 accountant and 1 general manager as part of the organization. Tolani Institute of Management Studies Page 2
• 3. General Company Description Our company will be in the confectionary business. Our company will be involved in manufacturing of chocolates. Vision Our vision is to be the leading manufacturer of chocolates all over India. Mission We seek to produce high quality products at competitive price using modern technology to provide high satisfaction to the consumers. Objectives  To manufacture and provide the customers with the quality products to the best interest of the customers.  To create Price competitive Products as part of the effect to increase the world access to high quality chocolates.  To ensure a hygiene & clean working environment as to continue to produce Safe & Tasty Products  To strive to Meet & Exceed Customer's Expectations so as to ensure a sustainable business relationship. Tolani Institute of Management Studies Page 3
• 4. Target Market  Upper class  Middle class  Lower middle class  All age groups About Chocolate Industry The chocolate market is estimated around 33,000 tonnes valued at approximately Rs. 8 billion. Bars of moulded chocolates like amul, milk chocolate, dairy milk, truffle, nestle premium, and nestle milky bar comprise the largest segment, accounting for 37% of the total market in terms of volume. To push sales chocolate companies have been targeting mainly adult audiences. Chocolates are being presented as snack food for the new target audiences. The chocolate segment is characterized by high volumes, huge expenses on advertising, low margins, and price sensitivity Cadbury is the leading player in the chocolate market industry with the penetration of 70% market share. The company's brands like Five Star, Gems, Éclairs, Perk, and Dairy Milk are leaders in their segments. Nestle &Amul are the other major players in chocolate industry. Chocolate industry is growing at steady growth rate of 25%. Over 70% of the consumption of chocolates takes place in the urban market. It is price sensitive market. Until early 90's, Cadbury had a market share of over 80 %, but its party was spoiled when Nestle appeared on the scene. The other one has introduced its international brands in the country (Kit Kat, Lions), and now commands approximately 15% market share. The two companies operating in the segment are Gujarat Co-operative Milk Marketing Federation (GCMMF) and Central Arecanut and Cocoa Manufactures and Processors Co-operation (CAMPCO). Competition in the segment will soon get keener as overseas chocolate giants Hershey's and Mars consolidate to grab a bite of the Indian chocolate pie. Tolani Institute of Management Studies Page 4
• 5. Indian Chocolate Industry’s Margin range between 10 and 20%, depending on the price point at which the product is placed. The input costs in India are under check owing to the 24% decline in the prices of sugar. Core Competencies The core competencies on which our company will compete are:  Taste By consuming the “Yummy Chocolates” flavor begins to fill your mouth the moment the chocolate begins to melt on your tongue like butter and it tastes like pure chocolate rather than cocoa powder. At first there is so much pleasure in tasting the chocolate, it may be difficult to focus on the specifics of flavor. First perception the consumer would describe for the chocolate as “chocolaty” and “Yummy”.  Quality The raw ingredients are of finest quality and also care is taken of the production process; roasting and crushing the cocoa beans and mixing the cocoa paste with sugar and other ingredients such as milk. Yummy chocolates are high quality chocolates as they are shiny brown, breaks cleanly and is smooth. Yummy chocolates has the sufficient quantities of cocoa butter and vegetable fat so that it does not become greasy or sticky at ambient room temperature. Ownership Our company will be a partnership firm. Tolani Institute of Management Studies Page 5
• 6. Competitor Analysis COMPANY FOUNDED IN BRAND PORTFOLIO (confectionery products) Nestle 1860s Kit Kat, Smarties, Wonka Ferrero 1940s Rocher, Raffaello, Kinder, Tic Tac, Mon Cheri, Nutella Mars 1911 Bounty, Galaxy, Mars, Snickers, Milky Way, Wrigley’s, M&M’s etc Amul 1945 Milk chocolate, Fruit & Nut chocolate Hershey’s 1894 Hershey’s milk chocolate, Tolani Institute of Management Studies Page 6
• 7. Kisses, Pot of gold, Milk duds, Reese’s, Icebreakers etc Perfetti 2001, when Perfetti Alpenliebe, Van Melle and Van melle Chlormint, merged Centerfresh, Happydent, Mentos ITC 2002(confectionery Minto and segment) Candyman Parle 1929 Melody, mango bite, poppins, kismi toffee, mazelo, xhale, éclair, golgappa, parlelites, orange candy Cadbury 1948 (Indian Market) Dairy Milk, Dairy Milk fruit N nut, Dairy Milk Tolani Institute of Management Studies Page 7
• 8. Shots, Dairy Milk Roasted Almond, Dairy Milk Silk Tolani Institute of Management Studies Page 8
• 9. Our Products Our company will be dealing in the manufacturing of 3 products. They are: 1. Milk Chocolate 2. Fruit & Nut Chocolate 3. Plain Chocolate Ingredients of Milk Chocolate Sugar, Full Cream Milk Powder, Vegetable Fat, Emulsifiers, Flavors, Whole Cow’s Milk, Cocoa Butter. Recipe for milk chocolate  Take one cup of powdered sugar, one cup of milk powder.  One heaped table spoon of cocoa powder, about half table spoon of butter, and to this add the minimum quantity of water required to make a thick batter.  Place this batter on a stove and bring to a boil on a low flame.  When the batter becomes thick (shown in the clip) stop the boiling, cool.  Pour into suitable moulds, cut, cool in a fridge and it gets ready. Tolani Institute of Management Studies Page 9
• 10. Ingredients of Fruit & Nut Sugar, Full Cream Milk Powder, Raisins, Cocoa Butter, Cocoa Mass, Almonds, Vegetable Fat, Emulsifiers, Flavors. Recipe for fruit & nut chocolate  First take whatever moulds you like and grease it with butter. Set this aside for a moment.  Melt the chocolate either in double boiler method or in a microwave. Remove it and set aside.  Chop up all your nuts and dried fruits. Add it to the chocolate and mix well.  Take a spoonful of this and fill your prepared mould and put it in the deep freeze for 1 hour.  Unmould it and keep it in the fridge until serving. Ingredients of Plain Chocolate Sugar, Full Cream Milk Powder, Cocoa Butter, Cocoa Mass, Vegetable Fat, Emulsifiers, Flavors. Recipe for plain chocolate  Combine cocoa and sugar and blend until all lumps of cocoa are gone. Add water and salt and mix well.  Cook over medium heat, bringing it to a boil.  Keep boiling until thick, stirring to keep from overflowing.  Remove from heat and let cool.  When cool, add vanilla.  Then put this in your milk, just like the store bought stuff. Tolani Institute of Management Studies Page 10
• 11. Marketing Plan Economics Total size of chocolate market is 33000 tonnes Trends in Consumer Preferences  The range and variety of chocolates available in malls seems to be growing day by day, which leads to lot of impulse sales for chocolates companies.  Chocolates which use to be unaffordable is now considered mid-priced.  Branded chocolates have become more popular.  Mithai is becoming the substitute of chocolates  Instead of buying sweets on Rakhshabhandan, Diwali, people prefer to buy chocolates. Barriers to entry  Huge startup costs  Ensuring good quality products to the customers  High Level of competition from the well established brands  To keep price of the product low, as it is a price sensitive market Overcoming the barriers to entry  To overcome the barrier of huge start up costs our machinery would be taken for lease for first few years of business.  Marketing of our products would be on the basis good quality and healthy products to provide a competitive advantage. Tolani Institute of Management Studies Page 11
• 12. Product From customer’s point of view, chocolate is the product which shows their impulse buying behavior. Customers are looking for low priced chocolates and also it should have good taste. Features and benefits Milk chocolate  Milk chocolate is a stimulator, to the brain, to the emotions, thus, increases your stamina.  Milk chocolate is high in vitamins B1, B2, D and E. It also contains potassium and magnesium.  Milk chocolate contains antioxidants that boost the immune system. Fruit N Nut chocolate  Almonds help in the creation of new blood cells, hemoglobin and help in proper functioning of vital organs of the body.  Almonds also help in weight loss, lowering blood pressure, reduction in risk of recurrent coronary heart disease, solving constipation, etc.  Raisin helps in digestion problems, acidity or constipation problems.  Raisins contain considerable amount of iron  Cashew nuts provide protein and fiber to body.  Cashews have no cholesterol. Cashews contain healthy monounsaturated fat that promotes good cardiovascular health Tolani Institute of Management Studies Page 12
• 13. Plain chocolate  Chocolate contains essential trace elements and nutrients such as iron, calcium and potassium, and vitamins A. B1, C, D, and E.  Cocoa is also the highest natural source for Magnesium.  The high Magnesium content of Chocolate is beneficial for the Cardiovascular System and hypertension.  Cancer Fighter  High in Antioxidants  Cocoa contains flavones, a type of flavonoid that is only found in cocoa and chocolate. Customers (Wholesalers and Retailers) Anil Provision Store 166 Dbz-North Sector, AryaSamaj Road, ZandaChowk, Gandhidham, Gandhidham– 370201 Rajani Provision Stores Vidhyanagar Main Road, ViraniChowk, Opp. Dr. Sanjay Gadre, ViraniChowk, Rajkot - 360002 Gayatri General Provision Stores Amrut Shopping Centre, Kevdawadi Main Road, Kevdawadi, Rajkot - 360002 JatinProvision Stores 6, Nityanand Apartment, Ellisbridge, Near PritamnagarAkhada, Ellisbridge, Ahmedabad, Gujarat 380006 Tolani Institute of Management Studies Page 13
• 14. Narayan Department Store KhodiyarChowk, Ram Nagar, Sabarmati, Ahmedabad, Gujarat 380005 Madhur Super Market Zodiac Square, Bodakdev, Ahmedabad Dhirajsons Toyshop Mega Store, Near Chowpati, Athwa Gate, Athwa Gate, Surat Sahaj Super Store Jain Wadi, Surat, Gujarat 395009 Ashok Provision Store Shop No:n -16, Main Bazar, Gandhidham, Gandhidham– 370201 Pankaj Provision Store Shop No1, Lilasha Nagar, 12c Plo No: 637, Gandhidham, Gandhidham– 370201 Chamunda Provision Store Gondal Road, Hasanvadi-4, Hasanwadi, Rajkot - 360002 Tolani Institute of Management Studies Page 14
• 15. Gujarat Provision Store C-72, Main Bazaar, Gandhidham- 370201 Yogeshwar Provision Store Dbz - N -No :1, Khanna Market, Gandhidham, Gandhidham– 370201 Dairy King Plot No 117, Plaza Corner, Oslo Circle, Gandhidham, Gandhidham– 370201 Signature ZandaChowk, Gandhidham - 370201 Kavita Provision Store Maitri Road, Adipur – 370205 Tolani Institute of Management Studies Page 15
• 16. Competitors  Amul  Nestle  Cadbury  Kent Niche Our niche market would be the children and young generation as chocolate is mostly liked by children and youngsters. Marketing strategy for niche market  Attractive packing: Our Company will focus on packaging to attract children.  Good quality and healthy chocolates are the factors on which marketing will be done. Promotion  Local news paper  Local TV channel  Local radio Station  Hoardings in Adipur and Gandhidham  Through pages and account on Social Networking Sites (Facebook & Twitter) Tolani Institute of Management Studies Page 16
• 17. Distribution channels Our products would be distributed through channels like wholesalers, retailers and our own sales force. Proposed Location For our business, the proposed location would be in GIDC, Gandhidham. Tolani Institute of Management Studies Page 17
• 18. Operational Plan Production The product will be manufactured by Full Automatic Chocolate Production Line (QH200), with this system, baking the moulds, depositing, forming etc. series procedure can be achieved automatically. It's available to depositing all shape of chocolate. Such as double color filled- inside, nuts etc chocolate. Since our product are plain as well as nut are added this machine is appropriate. This machine can produce 100-300 kg chocolates per hour. It can produce chocolates in different shapes .It can help to reduce cost of chocolates mould. By Producing Chocolates in different shapes we can attract all segments of market. The production capacity is fully automated as mentioned above, so the need of personnel is comparative less than other semi-automatic machine. Manufacturing process Chocolate production is highly sophisticated computer controlled process with much of the new specialist machinery. Machines like as chocolate cooling tunnels, enrobing machines, coating machines, moulding machines. Chocolate processing: Production flow of chocolate Cleaning When seeds arrive to factory they are carefully selected and cleaned by passing through a bean cleaning machine that removes extraneous materials. Different bean varieties are blended to produce the typical flavor of chocolate of particular producer. Then the bean shells are cracked and removed. Crushed cocoa beans are called nibs. Tolani Institute of Management Studies Page 18
• 19. Roasting The beans are then roasted to develop the characteristic chocolate flavor of the bean in large rotary cylinders. The roasting lasts from 30 minutes to 2 hours at very high temperatures. The bean colour changes to a rich brown and the aroma of chocolate comes through. Grinding The roasted nibs are milled through a process that liquefies the cocoa butter in the nibs and forms cocoa mass (or paste). This liquid mass has dark brown colour, typical strong smell and flavor and contains about 54% of cocoa butter. Cocoa Pressing Part of cocoa mass is fed into the cocoa press which hydraulically squeezes a portion of the cocoa butter from the cocoa mass, leaving "cocoa cakes". The cocoa butter is used in the manufacture of chocolates; the remaining cakes of cocoa solids are pulverized into cocoa powders. Mixing and Refining Ingredients, like cocoa mass, sugar, cocoa butter, flavorings and powdered or condensed milk for milk chocolate are blended in mixers to a paste with the consistency of dough for refining. Chocolate refiners, a set of rollers, crush the paste into flakes that are significantly reduced in size. This step is critical in determining how smooth chocolate is when eaten. Conching Conching is a flavour development process during which the chocolate is put under constant agitation. The conching machines, called "conches", have large paddles that sweep back and forth through the refined chocolate mass anywhere from a few hours to several days. Conching reduces moisture, drives off any lingering acidic flavors and coats each particle of chocolate with a layer of cocoa butter. The resulting chocolate has a smoother, mellower flavor. Tolani Institute of Management Studies Page 19
• 20. Tempering and Moulding The chocolate then undergoes a tempering melting and cooling process that creates small, stable cocoa butter crystals in the fluid chocolate mass and is deposited into moulds of different forms. Properly tempered chocolate will result in a finished product that has a glossy, smooth appearance. Cooling The moulded chocolate enters controlled cooling tunnels to solidify the pieces. Depending on the size of the chocolate pieces, the cooling cycle takes between 20 minutes to two hours. From the cooling tunnels, the chocolate is packaged for delivery to retailers and ultimately into the hands of consumers. Location Our manufacturing unit will be located in Adipur. Kandla Port and Mundra Port are also near to Adipur so it also helps in future, if we want Chocolates to be exported. Labour is easily available since there are many such labour contractor available in Gandhidham. We will get skilled and unskilled labour as per our need. Technical people are also available easily to monitor the quality and consistency of our product. Tolani Institute of Management Studies Page 20
• 21. Legal formalities:  We could get DIN (Director Identification Number) which is printed, signed, and sent to Ministry of Corporate Affairs.  Get a TAN (Tax Account Number) for income taxes from Income Tax Department’s Assessing Office.  We must be registered Enroll with Establishment Act (State/Municipal), Shops, and Office of Inspector.  We should also get food process order certificate from ministry of food processing industries and also doing as business certificate required for our chocolate industry. Personnel The machine is fully automatic so need of personnel is less. We need skilled worker for packaging and storage of our product. There would be a need of professional for checking and maintaining the quality of product. Inventory The basic raw material required for making chocolate is Sugar, Full Cream Milk Powder, Cocoa Butter, Cocoa Mass, Vegetable Fat, Emulsifiers, and Flavors. Tolani Institute of Management Studies Page 21
• 22. Suppliers For Milk Powder: Aditya Enterprises Mr. Abhay Near Jain Mandir, Kolhapur, Maharashtra, India - 416118 Phone: +91-230-2481402 Fax: +91-230-2481402 Mobile: +91-9011710691 Email ID: [email protected] Web Site: http://www.adityaenterprisesindia.in Sugar S-30: Payment Terms L/C AkhilendraPratap Singh ASA PORTFOLIO PRIVATE LIMITED Place of Origin: Maharashtra Packaging: 50 KG Delivery Detail: Within 20 days from the receipt of Confirmed payment instruments Tolani Institute of Management Studies Page 22
• 23. Butter & Vegetable Fat, Vegetable oil: Company Name : BABA CASEIN INTERNATIONAL Address :108, Kabir Market, HathiKhana Main Road Vadodara Gujarat India Zip : 390006 Tel : +91- 265- 2432628 Mobile Phone : 9824048990 Fax : +91- 265- 2432628 Website : http://www.baba-group.com Contact Person : Mr. AshwinGolani Milk Powder, Whole Milk Powder, Skimmed Milk Powder, Dairy Whitener, Butter Company Name : VARSHNEY BHANDU FOODS PVT LTD Address : 388 / 3, 1st Floor, Upper Side on Pratap Ghee, Main Road, KhariBaoli New Delhi Delhi India Zip : 110006 Tel : 91- 11- 23973674 Mobile Phone : 9810120977 Fax : 91- 11- 23973674 Website : http://www.meerapremium.com Contact Person : Mr. Anoop Kumar Varshney Cocoa Powder & Soya Leicithin: Akhil Healthcare Private Limited Mr. Manoj Shah (Managing Director) No. 205/206, B. B. C. Tower, Opposite World Trade Center, Sayajigunj Vadodara - 390 020, Gujarat, India Tolani Institute of Management Studies Page 23
• 24. Management and organization Company Name: Yummy Chocolate Company Owner Partners: ChandanPahelwani LeenaChellani General Manager:ChandanPahelwani Job Description:  Increasing management's effectiveness by recruiting, selecting, orienting, training, coaching, counseling, and disciplining managers  Communicating values, strategies, and objectives; assigning accountabilities  Accomplishes subsidiary objectives by establishing plans, budgets, and results measurements; allocating resources; reviewing progress; making mid-course corrections.  Maintains quality service by establishing and enforcing organization standards.  Contributes to team effort by accomplishing related results as needed. Finance Managers: DivyaDhawani RinkuSalat Job Description:  providing and interpreting financial information;  monitoring and interpreting cash flows and predicting future trends;  developing financial management mechanisms that minimise financial risk;  conducting reviews and evaluations for cost-reduction opportunities;  managing a company's financial accounting, monitoring and reporting systems;  liaising with auditors to ensure annual monitoring is carried out;  managing budgets;  arranging new sources of finance for a company's debt facilities; Tolani Institute of Management Studies Page 24
• 25. Marketing Managers: Jay Pujara NikunjGajara Job Description:  manage and coordinate all marketing, advertising and promotional staff and activities  conduct market research to determine market requirements for existing and future products  analysis of customer research, current market conditions and competitor information  develop and implement marketing plans and projects for new and existing products  manage the productivity of the marketing plans and projects  monitor, review and report on all marketing activity and results  determine and manage the marketing budget  deliver marketing activity within agreed budget  develop pricing strategy  deal with media and advertising Accountant: RinkuSalat Job Description:  compile and analyze financial information to prepare financial statements including monthly and annual accounts  ensure financial records are maintained in compliance with accepted policies and procedures  ensure all financial reporting deadlines are met  prepare financial management reports  resolve accounting discrepancies and irregularities  monitor and support taxation issues  develop and maintain financial data bases  financial audit preparation and coordinate the audit process  ensure accurate and appropriate recording and analysis of revenues and expenses Tolani Institute of Management Studies Page 25
• 26.  analyze and advise on business operations including revenue and expenditure trends, financial commitments and future revenues  analyze financial information to recommend or develop efficient use of resources and procedures, provide strategic recommendations and maintain solutions to business and financial problems Tolani Institute of Management Studies Page 26

How to Start a Chocolate Business

Crafting fine chocolate is a true art that takes mastery of candy making to the next level. Develop treats that your customers will go out of their way to purchase at a small shop or seek out for online delivery. You will be involved in packaging and marketing your sweets, and possibly running your neighborhood candy store along with the candy kitchen. Franchises for candy stores often feature products made at a distant factory, but are profitable in high foot-traffic areas and do not require candy making knowledge to operate.

Learn how to start your own Chocolate Business and whether it is the right fit for you.

Ready to form your LLC? Check out the Top LLC Formation Services .

Start a chocolate business by following these 10 steps:

• Plan your Chocolate Business
• Form your Chocolate Business into a Legal Entity
• Register your Chocolate Business for Taxes
• Open a Business Bank Account & Credit Card
• Set up Accounting for your Chocolate Business
• Get the Necessary Permits & Licenses for your Chocolate Business
• Get Chocolate Business Insurance
• Define your Chocolate Business Brand
• Create your Chocolate Business Website
• Set up your Business Phone System

We have put together this simple guide to starting your chocolate business. These steps will ensure that your new business is well planned out, registered properly and legally compliant.

Exploring your options? Check out other small business ideas .

STEP 1: Plan your business

A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:

What will you name your business?

• What are the startup and ongoing costs?
• Who is your target market?

How much can you charge customers?

Luckily we have done a lot of this research for you.

Choosing the right name is important and challenging. If you don’t already have a name in mind, visit our How to Name a Business guide or get help brainstorming a name with our Chocolate Business Name Generator

If you operate a sole proprietorship , you might want to operate under a business name other than your own name. Visit our DBA guide to learn more.

When registering a business name , we recommend researching your business name by checking:

• Your state's business records
• Federal and state trademark records
• Social media platforms
• Web domain availability .

It's very important to secure your domain name before someone else does.

Want some help naming your chocolate business?

Business name generator, what are the costs involved in opening a chocolate business.

Should you want to start your chocolate making business from the comfort of your home, you can do it for about $5,000-$10,000.  You'll need to invest in quality thermometers, a cold table, additional refrigerators and freezers for your business materials. You cannot store product for public consumption with your family's groceries.  Should you be going full-scale, a small professional stand alone candy kitchen can be built for around $50,000 with room for packaging and an office area. Should you wish to add a storefront, start-up costs can skyrocket up to $200,000 depending on location and targeted clientele.

What are the ongoing expenses for a chocolate business?

Marketing will always be part of your costs.  Paying for supplies of ingredients and maintaining your kitchen will be your other major cost, followed by payroll.

Who is the target market?

If you operate a small kitchen, your perfect customer will value fine chocolates personally crafted for their enjoyment and be willing to pay a premium for your treats. For a bigger candy kitchen, target gift shops, grocery stores, and other local retailers who would be willing to sell your product on their shelves. Gift services such as flower shops and fine food baskets may hire you to provide chocolates for their larger designs.

How does a chocolate business make money?

For the finest chocolates, it takes time to create perfection. You will charge your customers for the highest quality ingredients and the hours spent crafting your product. However, lower quality chocolate generates the most money through volume, selling lots of small bags of sweets to hungry customers. Carefully target your audience before settling on recipes and pricing structure.

A one pound box of fine chocolates can run as high as $30.  For more ordinary chocolate, expect to charge around $7 to $10 per pound.  If you add special occasion packaging, tack on an additional 10% to the price.

How much profit can a chocolate business make?

The large volume companies have a lower profit margin of around 8 to 10%, while boutique chocolatiers can enjoy margins between 55 to 75%.  Your total profit for a year will depend entirely on the volume and type of product you produce and sell.  The home-based candy kitchen can earn enough for a nice vacation, or a well-positioned boutique can bring in $1,000,000 in annual sales.

How can you make your business more profitable?

Through constant business model review, cull any recipes that do not sell from your selection. Increase profits by supplying demand for your most popular items, answering your customers' desire for all things deliciously chocolate.

Want a more guided approach? Access TRUiC's free Small Business Startup Guide - a step-by-step course for turning your business idea into reality. Get started today!

STEP 2: Form a legal entity

The most common business structure types are the sole proprietorship , partnership , limited liability company (LLC) , and corporation .

Establishing a legal business entity such as an LLC or corporation protects you from being held personally liable if your chocolate business is sued.

Form Your LLC

Read our Guide to Form Your Own LLC

Have a Professional Service Form your LLC for You

Two such reliable services:

You can form an LLC yourself and pay only the minimal state LLC costs or hire one of the Best LLC Services for a small, additional fee.

Recommended: You will need to elect a registered agent for your LLC. LLC formation packages usually include a free year of registered agent services . You can choose to hire a registered agent or act as your own.

STEP 3: Register for taxes

You will need to register for a variety of state and federal taxes before you can open for business.

In order to register for taxes you will need to apply for an EIN. It's really easy and free!

You can acquire your EIN through the IRS website . If you would like to learn more about EINs, read our article, What is an EIN?

There are specific state taxes that might apply to your business. Learn more about state sales tax and franchise taxes in our state sales tax guides.

STEP 4: Open a business bank account & credit card

Using dedicated business banking and credit accounts is essential for personal asset protection.

When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil .

Open a business bank account

Besides being a requirement when applying for business loans, opening a business bank account:

• Separates your personal assets from your company's assets, which is necessary for personal asset protection.
• Makes accounting and tax filing easier.

Recommended: Read our Best Banks for Small Business review to find the best national bank or credit union.

Get a business credit card

Getting a business credit card helps you:

• Separate personal and business expenses by putting your business' expenses all in one place.
• Build your company's credit history , which can be useful to raise money later on.

Recommended: Apply for an easy approval business credit card from BILL and build your business credit quickly.

STEP 5: Set up business accounting

Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.

Make LLC accounting easy with our LLC Expenses Cheat Sheet.

STEP 6: Obtain necessary permits and licenses

Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.

State & Local Business Licensing Requirements

Certain state permits and licenses may be needed to operate a chocolate business. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits .

Food establishments are randomly inspected by the local health department on a regular basis. These inspections will check for compliance with local health laws, typically related to prevention of food contamination. Tips for faring well on a health inspection can be found here .

Most businesses are required to collect sales tax on the goods or services they provide. To learn more about how sales tax will affect your business, read our article, Sales Tax for Small Businesses .

Certificate of Occupancy

A chocolate making business is generally run out of a storefront. Businesses operating out of a physical location typically require a Certificate of Occupancy (CO). A CO confirms that all building codes, zoning laws and government regulations have been met.

• If you plan to lease a location :
• It is generally the landlord’s responsibility to obtain a CO.
• Before leasing, confirm that your landlord has or can obtain a valid CO that is applicable to a  chocolate making business.
• After a major renovation, a new CO often needs to be issued. If your place of business will be renovated before opening, it is recommended to include language in your lease agreement stating that lease payments will not commence until a valid CO is issued.
• If you plan to purchase or build a location :
• You will be responsible for obtaining a valid CO from a local government authority.
• Review all building codes and zoning requirements for your business’ location to ensure your chocolate making business will be in compliance and able to obtain a CO.

STEP 7: Get business insurance

Just as with licenses and permits, your business needs insurance in order to operate safely and lawfully. Business Insurance protects your company’s financial wellbeing in the event of a covered loss.

There are several types of insurance policies created for different types of businesses with different risks. If you’re unsure of the types of risks that your business may face, begin with General Liability Insurance . This is the most common coverage that small businesses need, so it’s a great place to start for your business.

Another notable insurance policy that many businesses need is Workers’ Compensation Insurance . If your business will have employees, it’s a good chance that your state will require you to carry Workers' Compensation Coverage.

FInd out what types of insurance your Chocolate Business needs and how much it will cost you by reading our guide Business Insurance for Chocolate Business.

STEP 8: Define your brand

Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will help your business stand out from competitors.

If you aren't feeling confident about designing your small business logo, then check out our Design Guides for Beginners , we'll give you helpful tips and advice for creating the best unique logo for your business.

Recommended : Get a logo using Truic's free logo Generator no email or sign up required, or use a Premium Logo Maker .

If you already have a logo, you can also add it to a QR code with our Free QR Code Generator . Choose from 13 QR code types to create a code for your business cards and publications, or to help spread awareness for your new website.

How to promote & market a chocolate business

Taste is everything in the chocolate world. When introducing your business to potential clients, whether a distributor or individual, they will need a sample of the product they are purchasing. Consider a direct-mail sampling campaign to kick-off your success. If you are opening a single shop, make sure to hold a grand opening with lots of freebies for your guests. Target a busy holiday like Christmas, Valentine's Day or Easter for your opening, as more people will be looking to add chocolate to their shopping list.

How to keep customers coming back

During your initial year, consider holding a several sampling campaigns at malls, grocery stores or farmers markets. Create a direct mail campaign with attractive photos depicting your sweets and their gift-worthy packaging. An attractive box with festive ribbon helps to draw the eye and encourage customers to pay an additional premium. Customers will keep coming back when they eat your delicious chocolate.

STEP 9: Create your business website

After defining your brand and creating your logo the next step is to create a website for your business .

While creating a website is an essential step, some may fear that it’s out of their reach because they don’t have any website-building experience. While this may have been a reasonable fear back in 2015, web technology has seen huge advancements in the past few years that makes the lives of small business owners much simpler.

Here are the main reasons why you shouldn’t delay building your website:

• All legitimate businesses have websites - full stop. The size or industry of your business does not matter when it comes to getting your business online.
• Social media accounts like Facebook pages or LinkedIn business profiles are not a replacement for a business website that you own.
• Website builder tools like the GoDaddy Website Builder have made creating a basic website extremely simple. You don’t need to hire a web developer or designer to create a website that you can be proud of.

Recommended : Get started today using our recommended website builder or check out our review of the Best Website Builders .

Other popular website builders are: WordPress , WIX , Weebly , Squarespace , and Shopify .

STEP 10: Set up your business phone system

Getting a phone set up for your business is one of the best ways to help keep your personal life and business life separate and private. That’s not the only benefit; it also helps you make your business more automated, gives your business legitimacy, and makes it easier for potential customers to find and contact you.

There are many services available to entrepreneurs who want to set up a business phone system. We’ve reviewed the top companies and rated them based on price, features, and ease of use. Check out our review of the Best Business Phone Systems 2023 to find the best phone service for your small business.

Recommended Business Phone Service: Phone.com

Phone.com is our top choice for small business phone numbers because of all the features it offers for small businesses and it's fair pricing.

Is this Business Right For You?

If you love creating new and original chocolate treats, and enjoy spending hours every day crafting fine candies, opening your own chocolate making business might be right for you. The successful candidate will also enjoy teaching others to duplicate their recipes, manage portion control, market their products, and balance the books.

Want to know if you are cut out to be an entrepreneur?

Take our Entrepreneurship Quiz to find out!

Entrepreneurship Quiz

What happens during a typical day at a chocolate business?

When you own a chocolate making business, you can expect to complete these tasks on any given day:

• Craft fine chocolates with a keen attention to detail and consistency
• Adhere to sanitary food preparation guidelines according to your Board of Health
• Clean the kitchen
• Order supplies
• Conduct quality control tests
• Train chocolatiers in new recipes and products
• Pack candies for shipment or delivery with attention to maintaining product quality
• Market your product and business to potential customers nearby and online
• Pay invoices and collect payments
• Complete payroll for your staff
• Operate your store, if included with your business model
• Inform consumers of ingredients with complete list of potential allergens

What are some skills and experiences that will help you build a successful chocolate business?

• Good palate and appreciation of what fine chocolate tastes and looks like
• Extensive knowledge of the art of chocolate making
• Basic accounting and personnel knowledge
• Safe food handling practices that include obtaining proper certifications
• Good marketing background
• Understanding of packaging/display and how that affects your customer's perception of your product
• Knowledge of product distribution networks/shipping options

What is the growth potential for a chocolate business?

Should you create a new chocolate treat that takes your neighborhood by storm, expansion into larger candy stores, distribution to more outlets and increasing internet sales provide endless opportunities for expansion.  However, success begins with the best chocolates.

TRUiC's YouTube Channel

For fun informative videos about starting a business visit the TRUiC YouTube Channel or subscribe to view later.

Take the Next Step

Find a business mentor.

One of the greatest resources an entrepreneur can have is quality mentorship. As you start planning your business, connect with a free business resource near you to get the help you need.

Having a support network in place to turn to during tough times is a major factor of success for new business owners.

Learn from other business owners

Want to learn more about starting a business from entrepreneurs themselves? Visit Startup Savant’s startup founder series to gain entrepreneurial insights, lessons, and advice from founders themselves.

Resources to Help Women in Business

There are many resources out there specifically for women entrepreneurs. We’ve gathered necessary and useful information to help you succeed both professionally and personally:

If you’re a woman looking for some guidance in entrepreneurship, check out this great new series Women in Business created by the women of our partner Startup Savant.

What are some insider tips for jump starting a chocolate business?

Find your superstar sweet that will become your specialty.  It must stand out from the generic checkout candy and easily compete with big brand name treats found in popular mall stores. Sampling your creation helps to get consumers excited about your product who will then spread the word for you. Think about conducting sales at high-traffic events such as fairs, pop-up mall locations, and cooking trade shows.

How and when to build a team

If you are opening a large kitchen from the beginning, you will need to hire chocolatiers during your research and testing period in order to perfect your product before you sell the first unit. For the home baker, you may wish to hire a business partner when distribution starts to outpace your capacity.

Useful Links

Industry opportunities.

• Franchise Opportunity with Peterbrooke Chocolatier
• Fine Chocolate Industry Association
• Professional School of Chocolate Arts

Real World Examples

• Socola Chocolatier
• The Velvet Chocolatier
• Schakolad Chocolate Factory

Further Reading

• 7 Step to start a candy or chocolate business

Have a Question? Leave a Comment!

Start a Chocolate Business

Indulging in the Sweet Delight of Your Own Chocolate Business

CHOCOLATE BUSINESS

Related business ideas, discover your perfect domain, chocolate mini business plan, business idea: gourmet chocolate production and sales, expected percent margin:, expected earnings:, actions needed to achieve those numbers:, recipe development and production:, marketing and brand building:, sales channels:, operational costs:, not what you had in mind here are more ideas, grab your business website name, step 1: determine if starting a chocolate business is right for you, breakdown of startup expenses, breakdown of ongoing expenses, examples of ways to make money, step 2: name your chocolate business, step 3: create a business plan, executive summary, description of the business, market analysis, description of the products and services, description of the management team, financial plan, description of the legal structure of the business, step 4: obtain business licenses and permits, how to obtain licenses and permits, cost of licenses and permits, benefits of obtaining licenses and permits, step 5: secure financing, steps to secure financing, step 6: choose a location, considerations for a retail space, considerations for a production facility, considerations for an online business, considerations for a mobile business, finalizing the location, step 7: purchase equipment, cost of equipment, where to purchase equipment, financing options, step 8: market your business, online advertising, print advertising, radio advertising, direct mail, word-of-mouth, social media, step 9: monitor your business, create a system for monitoring, use technology to monitor your business, develop strategies for improvement, explore more categories, take the next steps.

Chocolate Business Plan Qualitative Research

• To find inspiration for your paper and overcome writer’s block
• As a source of information (ensure proper referencing)
• As a template for you assignment

Executive summary

This is a business plan for Ki, a start-up business that aims at becoming a high-end chocolate brand in the UK. The company sets to achieve this by serving its customers with high quality and delicious chocolate made from 100% Mexican cocoa and recipes. This business plan gives a description of the company, its mission, business objectives and business strategy.

The plan additionally includes an industry analysis of UK’s high-end chocolate market to determine its attractiveness and how it is influenced by political, environmental, social and technological factors in the UK. Other constituents of this business plan are Ki’s marketing, operational and finance plan, SWOT and business risk analysis and risk and contingency evaluation

Statement of purpose for the business plan

The statement of purpose for Ki’s business plan is “to enable Ki to successfully enter into and grow in UK’s high-end chocolate industry”.

Terms of reference

To give a practical experience of the concepts and issues involved in the preparation of a business plan

Methods and procedures

In doing an industry analysis of UK’s high-end chocolate industry this business plan uses the Porter’s five forces approach to determine the industry’s attractiveness and a PEST analysis to determine how the industry is affected by political, environmental, social and technological factors in the UK.

These are augmented with secondary research. Ki’s market plan includes discussions on market segmentation, Ki’s product, pricing and promotional strategies.

Ki’s operational plan includes discussions on location capacity and equipment, organizational structure, wages and growth plans, quality and logistics. Ki’s financial plan includes a discussion on funding, financial income statements and financial performance indicators. The SWOT and business risk analysis section includes a SWOT analysis of Ki and discussion on Ki’s internal and external auditing.

In addition, this part also includes a discussion of the risks that have been identified and addressed following the SWOT and audit analysis. The risk and contingency evaluation section discusses Ki’s approach to risk and contingency evaluation

Introduction

Ki is a start-up business with a mission of becoming a competitive high end chocolate brand in the UK. The Mayan – an indigenous Mexican community – name of the company highlights the interest of the company, its history and values. The name means “delicious”. Indeed to produce delicious chocolate the company has strategically chosen Mexico as the location in which the chocolate will be produced.

The reason for this is that Mexican Cocoa (the plant from which chocolate is produced) has international recognition for high quality. To produce a 100% Mexican product the packaging of will also be done in Mexico.

Ki’s key personnel

One of Ki’s key personnel is the managing director who will also double up as the company’s CEO. This is topmost individual in the company’s managerial hierarchy and he/she is the main decision-maker. This individual will work with Ki’s divisional managers to put together resources and to take the company’s product into the market.

His/her tasks include setting the company’s culture, strategy development and deployment, directing the company, leading divisional managers, marketing the company’s product and managing the company’s physical and financial resources. Another of Ki’s key personnel is the operations manager.

This individual will head and lead the company’s operation division and will have the responsibility of ensuring financial success in the company. His/her main task is managing the company’s relations with lending institutions, surrounding community and vendors.

Another of Ki’s key personnel is the quality control and safety manager. This individual will have the responsibility of ensuring high quality in Ki’s products and ensuring that they conform to FSA’s food safety standards and requirements. Another of Ki’s key personnel is the human resource manager.

This individual will have the responsibility of developing the company’s HR policy and ensuring there is efficient recruitment and management of the company’s human capital. Another of Ki’s key personnel is the accountant. This individual will be the company’s bookkeeper.

He/she will have the responsibility of efficiently managing the company’s cash and preparing the necessary financial documents e.g. annual financial statements and budgets. Another of Ki’s key personnel is the shipping and receiving manager.

This person will have the responsibility of receiving Ki’s imports and ensuring they safe keeping in the company’s warehouse. Another of Ki’s key personnel is the professional staff. This includes the companies IT technician, lawyer and receptionist. Such individual will play a management supportive role.

Mission statement

It is the Mission of Ki to provide UK’s high-end chocolate lovers with high-quality and delicious chocolate made from 100% Mexican cocoa and recipes. Furthermore, by achieving these, the company hopes to become a competitive high-end chocolate brand in the UK.

Business objectives

Ki’s general objective is to produce and sell high-quality chocolate in a way that supports social and environmental development. The company has a number of specific objectives. One of these specific objectives is that the company wants to optimize its use of natural resources e.g. cocoa and thus minimize wastage to negligible and acceptable levels.

Another specific objective of the company is ensuring high quality and freshness of its chocolate products. Another specific objective of the company is that it intends to make a positive impact on cocoa farming in Mexico. Another of KI’s specific objectives is to make its chocolate the preferential choice for customers.

This it intends to achieve through creating a linkage between it and its customers. Another specific objective of the company is to create high quality products that are made from 100% Mexican raw materials.

Business strategy

Ki will use a corporate business strategy. With this approach, Ki defines what it does, why it exists and what it purposes to become. In addition to this, Ki defines its operating market and business. The reason for choosing this approach is that it purposes on meeting stakeholder expectations. This is very important for a start up business like Ki.

Industry analysis

Porter’s five forces.

Companies in UK’s high-end chocolate industry face the threat of new entrants into this market as the Kingdom’s economy stabilizes from the recent global economic recession. The resiliency of the industry is during this crisis is another factor that is attracting and encouraging new entries. For instance, Nestlé’ launched its Maison Cailler premium chocolate brand this year of which the UK was a target market.

There are no legislative barriers to entry in this industry; however, its high capital is a hindering factor. Companies in UK’s high-end chocolate industry do not face the threat of counterfeit goods as the industry enjoys clearly defined intellectual property protection. The intellectual property protected includes recipes and brand elements such as names, logos and trademarks.

Supplies for UK’s high-end chocolate companies do not have much bargaining power due to their high number. However, companies face the risk of variable prices of cocoa in the international market. This is because the commodity is grown in developing countries facing potential political instability. UK’s high-end chocolate industry inherently does not suffer from increased bargaining power of customers.

The reason for this is that it deals in luxury products. There is no intense rivalry in UK’s high-end chocolate market because it has clear and dominant leaders. The conclusion from this Porter’s five forces analysis of UK’s high-end chocolate industry is that it is an attractive industry.

PEST analysis

Political factors.

According to the UK taxation policies, at the minimum companies in UK’s high-end chocolate industry make tax payments to two government entities, namely, the central government and the local government. They pay tax to the central government through corporate tax payments to HM Revenues and Customs. Calculation of this corporate tax uses a flat marginal tax rate.

The companies also make payments (or contributions) to the central government known as national insurance contributions. In addition to these they are also charged value added tax (VAT), excise tax, stamp duty, vehicle excise duty, fuel tax (or hydrocarbon oil duty ) and corporation.

To the local government the companies pay council tax, rates (property tax) and business rates. All of these taxes apply to Ki because it is a business entity and an employer.

Legislation impacting UK’s high-end chocolate industry

UK’s employment legislature defines an employee as any individual who has a “contract of service”. In this case an employer is the entity that provides the contract of service to the employee. UK’s employment legislature prohibits against age, disability, racial and sex discrimination.

UK’s employment legislation prohibits against unfair dismissal and clearly states that an employer should give an employee’s reasonable notice before his/her dismissal.

According to this legislature, companies should consider an employee’s dismissal fair if it is out of, first, the employee’s incapability and unacceptable qualification, second, the employee’s misconduct, thirdly, a genuine redundancy, fourthly, avoidance of contravening an existing statute and fifthly, any other genuine and substantial reason.

When there is an impending dismissal a company will issue a notice to the employee(s) according to the requirements of the legislature. That is, 1 week’s notice for employees with an employment life spanning one to 24 months and for those with a longer employment life, the number of weeks for issuing the notice will be equal to the number years worked.

UK’s employment legislature defines redundancy as a business situation arising from, first, failure of the whole or part of a business, second, a shift of business location or thirdly, the ending of a business’s need for a particular kind of work. UK’s employment legislature advices employers to accord their employees with family-friendly flexible working arrangements e.g. telecommuting, job sharing, flextime etc.

UK health legislature

UK health legislature comprises of work place regulations. These support and enhance workplace safety, health and welfare. According to Act 1974 of British legislature a breach of these regulations constitutes a crime. The punishment of which is a summary conviction accompanied with an appropriate fine.

If the crime is serious as to necessitate an indictment in the kingdom’s Crown Court then there is the possibility of an imposition of an unlimited fine to the offender.

The legislature makes it clear than an offender can be either a person or corporate organization e.g. Ki. Furthermore, the legislature covers situations in which a breach of these regulations causes damage to an individual e.g. an employee of an organization such as Ki. It defines a right and cause of action for such an individual.

Trade Tariffs

According to UK’s Trade Tariff the products in UK’s high-end chocolate industry fall under its section IV (Business link, 2012).

In this section the products’ description is given under the heading number “1806” (titled “Chocolate and other food preparations containing cocoa”) of chapter 18 (titled “COCOA and COCOA PREPARATIONS”) (Business link, 2012). According to the notes on this chapter the UK has no trade restrictions on these products.

Economic factors

When measuring using nominal GDP UK’s economy is the seventh-largest national economy globally whereas when using purchasing power parity (PPP) it is the eighth-largest. There was a 0.3% drop (or contraction) of UK’s GDP by the end of 2011 and as a result the kingdom’s economic growth fell from 0.8% in the previous year to 0.7% (BBC 2012).

In 2012, the expectation is that the economy will oscillate between contraction and economic growth. In March 2012, there was a rise in the inflation rate of the consumer price index (CPI) by 0.1% whereas that of the retail price index (RPI) fell by the same amount (BBC 2012). The CPI rate currently standing at 3.5% is according to the BBC (2012) “still above the Bank of England’s target of 2%”.

Interest rates in the UK still remain at a cautious 0.5% (BBC 2012). These low interest rates are necessary as the kingdom attempts to stabilize against the effects of the recent global recession.

UK’s emergence from this recession was in the fourth quarter of 2009 when it recorded a 0.4% economic growth. According to the exchange rates on the 29th April 2012 1 pound is exchanging at 21.08 to the Mexican Peso and at 1.62 to the US dollar (Reuters, 2012)

Social factors

Health consciousness.

Consumer habits and trends in the UK suggest that the kingdom’s health consciousness has been increasing since the year 2000. This means that an increasing number of the kingdom’s populace want foods that are healthy. According to the seventh survey of UK’s Food Standard Agency (FSA) consumers in the kingdom are interested with foods of high nutritional value (Fletcher, 2007).

The FSA is the body in the UK that sees to it that food business such as those in UK’s high-end chocolate business conform to food safety and health standards (Crown, n.d.). When this organization places a red light on a food product it is sending a message to a consumer that the product contains a high levels of a nutrient that he/she should not consume in excessive amounts.

The FSA has given chocolate a red light, however, this as not had a negative impact on its sales as, as been the case with other products. Additional research by the FSA reports that hygiene is increasingly becoming a concern to UK’s consumers.

UK Population growth rate

UK’s population is increasing. The kingdom’s population growth rate is at its highest according to Office for National Statistics data. Immigration to the UK also has been on the increase in the recent past averaging at 240,000 immigrants a year (Market Oracle Ltd. 2012). The immigrants are majorly of a productive age and are highly fertile, hence the rise in UK’s population growth rate.

This rise is positive news for companies in UK’s high-end chocolate industry as it implies an increasing target market. Individuals of the ages 0 to 14 years make up 18% of UK’s population, 66.3% are individuals of the ages 15 to 64 years and 15.7% are individuals with 65 years and above.

Technological factors

One recent technological innovation that is of importance to UK’s high-end chocolate industry is in catering and packaging. Hygiene especially in catering is come out as a major concern to UK consumers. The FSA has developed SFBB packs that facilitate hygienic catering and packaging of food substances. The designing of these packs takes into account the different food business.

Secondary research

Even with increasing health consciousness there is increasing and continual growth in UK’s high-end chocolate industry. There is opportunity in it for start up business like Ki. One factor that that is driving and facilitating growth in this industry is population growth. Venturing into new markets is another factor that is driving growth in the industry since it enlarges the industry’s target market.

Product innovation is another factor that is driving growth of UK’s high-end chocolate industry. The innovation facilitates the meeting of customer demands at high levels. The rise in disposable income levels is another factor driving the growth of UK’s high-end chocolate industry. These rise means consumers have more purchasing power. Large-scale production companies have dominance in UK’s chocolate industry.

As a result SMEs focus on providing unique and special chocolate and/or chocolate products. According to Sena ” Unique chocolates may be from a region famous for a particular technique, baked on-site or offer a different take on tradition, while specialty services tend to focus on gift-packaging or delivery” (2012).

One driver of customer demand with respect to chocolate is taste. Customers love to consume chocolate that is delicious. In Great Britain 91% of its females and 87% of its males consume chocolate and its allied products. The love for tasty chocolate has spread beyond the UK and into other markets such as India and China in which disposable incomes and taste innovations are the key drivers of the industry’s growth.

Even during the recent global recession chocolate sales were strong. Surprisingly, with individuals making cuts on other items chocolate still remained to many as Sena (2012) points out an “affordable luxury”. Financial performance success in the chocolate industry is highly dependent on manufacturing efficiency, supply chain efficiency and marketing strategy effectiveness.

A concern in this industry is the variability and subsequent unpredictability in the cost of raw materials e.g. cocoa. Cocoa prices have been seen to be variable a situation which arises because it is mostly grown in developing countries with political and economic instability.

The chocolate industry has shown resiliency in the face of the recent global recession. It has also shown innovativeness when it comes to meeting emerging consumer demands driven by increasing health and production consciousness. Small companies in the industry focus more on providing the market with premium and special chocolate and its allied products.

Growth in the industry will remain as new markets open up for chocolate and its allied products and as economies recover from the recent global recession. Healthier varieties of chocolate are becoming more popular with consumers. Fair-trade arrangements are increasing in the industry to counter the human exploitation in the production of chocolate.

Size of the Industry

UK’s chocolate Consumption is the seventh highest in the world with the average Brit consuming 17.49lbs (or 7.93Kgs) of the product annually (Chocolate Devine Ltd., 2011). The size of UK’s chocolate industry by sales is £3.6billion (Chocolate Devine Ltd., 2011). According to predictions by experts chocolate sales in the UK will over the next five years increase by 17%.

This implies a corresponding increase in the size of the industry, which is dominated by international companies such as Kraft and Nestle. According to The Times 100 (2012) “UK consumers have a choice of over 5,000 chocolate lines available from 150,000 outlets”. UK’s chocolate market workforce is in its tens of thousands.

Purchase process and buying criteria

A criterion that consumers are using when purchasing high end chocolate (or luxury chocolate market) is ethics in the production process. UK consumers do not want to consume chocolate whose production disregards human welfare and proper social, economical and environmental ethics. The steady rise in demand for Fair Trade chocolate in the UK is testament to this fact.

Another criterion is environmental awareness. Globally, there is a rise in environmental awareness with consumers increasingly wanting products that show consciousness to the environment. This is no different in UK’s chocolate industry. The steady rise in the demand for organic luxury chocolate in the UK is testament to this fact.

One of the main reasons why luxury chocolate is purchased is that it makes a great gift for many individuals an attribute that is significantly enhanced by the Fair Trade and organic chocolate concepts.

These concepts, however, have a price-escalation effect on the price of luxury chocolate as they are quite costly for the producer to implement. The high price is, however, important when you consider the non-monetary gains achieved from these concepts.

Description of industry participants

There are a number of high-end chocolate brands in the UK such as Godiva, Leonidas, La Maison du Chocolat. These companies stock 150,000 outlets in the UK with over 5000 chocolate varieties (The Times 100, 2012). The major dominant brands are international and they are Kraft, Mars and Nestlé. Kraft’s share of the market is 28% whereas Mars’s and Nestlé’s share of the market is approximately 24% each (The Times 100, 2012).

All of these companies distribute their products to major retail outlets, department stores and chain stores in the UK. They ensure that they have a steady, smooth and efficient supply chain as this is effective in ensuring that customer demands are being met and on time. Such a supply chain is the end result of well calculated and designed logistic strategies.

Industry trends

Recent chocolate industry trends are driving product innovation and the growth of the industry as well. According to Sena (2012), new product releases in UK’s chocolate industry in 2010 were 16% higher than in 2009. These trends are aiming at providing chocolate consumers with healthier products. A beacon of these trends is dark chocolate, which has been bound to significantly reduce blood pressure and cholesterol.

In addition, dark chocolate is highly nutritious as it contains quite a massive amount of antioxidants. Another beacon of these trends is the Fai Trade certified chocolate. This is an arrangement between a chocolate producer and a consumer such that the latter pays premiums to the former to ensure that he/or she buys or consumes ethically produced chocolate and/or chocolate products.

Fair-trade arrangements simply ensure that production of chocolate in developing countries is free of human exploitation. These arrangements add to the sentimental value of chocolate.

Another trend in the chocolate industry is the increasing demand for premium and specialty items. The demand for these items during the recent global recession was low, however, as economies pull out and recover from this crisis the demand is raising.

On of these items is the high-end chocolate variety which is baked on the business premise and that has a secret recipe. Another item as given by Sena is the ” seasonal and boxed assorted chocolates” (2012).

Opportunities in the industry

There are franchising opportunities in the chocolate industry. The level of franchising depends on the interest of the franchiser. Gift-giving franchisees deal in delivering gift-chocolate. Bulk Candy franchisees offer a wide variety of chocolate and non-chocolate confectionaries. Premium or unique franchisees offer high-end and special chocolate that is an import from areas (or regions) with historical repute.

On-Site baking franchisees bake chocolate on order for a customer. This not only produces chocolate but gives a customer the baking experience as well. Ethical franchisees offer chocolate on a Free Trade arrangement, which guarantees quality and increase in the sentimental value of the product.

Industry outlook

The sales of high-end chocolate are expected to improve in the next three to five years as UK’s economy continues to stabilize from the recent global economic recession. This is because the stability is causing a rise in disposable incomes, which are in turn increasing the purchasing power of consumers.

Another projection is that the sales of high-end Fair Trade chocolate and organic high-end chocolate are expected to rise and as such these products have the greatest opportunity for growth.

High-end chocolate lovers want to promote ethics in its production and as such are endlessly entering into Fair Trade arrangements with producers. This concept is relatively new; however, its knowledge is spreading steadily among high-end chocolate consumers. As it spreads the sales of Fair Trade chocolate are improving by the day.

High-end chocolate lovers are increasingly becoming aware of the environment. Thus, by buying organic high-end chocolate they are demonstrating their concern and care for it (the environment).

Convectional high-end chocolate sales in the UK are projected to decline significantly over the next three to five years. This is because UK consumers are increasingly becoming health conscious and as such are demanding for healthier chocolate.

Marketing plan

Target market.

Ki’s target market is all lovers of delicious high-end (or luxury) chocolate in the UK whether it is Fair Trade or organic. UK’s demographic study shows that 18% of UK’s population are individuals of the ages between 0 to 14 years, 66.3% are individuals of the ages 15 to 64 years and 15.7% are individuals with 65 years and above.

From these statistics Ki’s specific target market will be high-end chocolate lovers in the 15 to 64 years age group and 65 years and above. There is exclusion of the 0 to 14 years age group because it is unlikely that individuals in this age bracket will be able to afford this product, which is quite expensive especially when there is introduction of the Fair Trade and organic variants.

In the 15 to 64 years age group Ki’s marketing strategy will have a special focus on high-end chocolate lovers with salary packages that accommodate disposable income. This is because Ki projects that the purchasing power of these individuals will keep raising as UK’s economy continue to stabilize. This projection is inferred from the industry research undertaken by Ki and which is presented above.

In the 65 years and above age group, Ki’s marketing strategy will focus on middle and upper class high-end chocolate lovers. This is because individuals in this age bracket most likely are able to afford high-end chocolate. Generally, Ki’s target market is any individual in the UK who loves high-end chocolate and is able to afford it.

Description of key competitors

Ki’s major competitors in the UK’s high-end chocolate market include Nestlé, Mars, Godiva and La Maison du Chocolat. Nestlé, headquartered in Switzerland, is the dominant company in UK’s high-end chocolate market owning 28% share of it. Nestlé venture into the high-end chocolate market was a strategy to counter and mitigate the effects of the recent economic downturn.

It launched its Maison Cailler brand of high-end chocolate in January this year (Dow Jones Newswires, 2012) in Switzerland and already there is strong performance of the product in the UK market. According to Broc who is the Director of the company’s Chocolate Centre of Excellence this brand aims at offering high-end chocolate consumers in the UK with the perfect personalized chocolate (Nestlé, 2012).

Interested individuals undergo a profiling stage aimed at revealing the individuals chocolate personality or taste. After successfully completing the profiling the individual waits for the personalized chocolate (Maison Cailler chocolate) to arrive. This arrives within 48 hours so as to ensure its freshness.

The personalized chocolate is created using secret recipes only known to Maison Cailler, a chocolate company now in the ownership of Nestlé. There are twelve variants of the Maison Cailler chocolate to choose from. Nestlé’s marketing strategy for this new brand rests on the quality of the product and of the service.

The company is of the view that successful marketing is achievable mainly through giving customers a product and service of unrivalled quality. In addition to this, the company is making use of the internet platform to popularize this brand by encouraging buyers to share their experiences with the product online with their friends.

Godiva Chocolatier is another of Ki’s major competitors in the UK’s high-end chocolate market. The company manufactures high-end chocolate and other allied products. Godiva is a Turkish-owned company with Belgian roots. In North America, Europe and Asia Godiva owns and runs over 450 buying outlets, which are either boutiques or shops.

In addition, in these same regions the company’s products are sold by more than 10,000 speciality retailers. Gold Ballotin is the name for Godiva’s lucrative high-end chocolate brand. The name is French and in English means a small and elegant box of chocolates.

A package of this brand contains a collection of chocolates made from classic Belgian recipes. Each piece in the Gold Ballotin is according to FTD “an exquisitely rich, velvety chocolate with fascinating flavours and intriguing textures to delight your favourite chocolate lover”.

The package for Godiva’s Gold Ballotin chocolates is a golden box of striking beauty. Godiva believes that such a package shows not only style but sophistication as well. The Gold Ballotin is a perfect choice for gift shoppers and it comes in different sizes e.g. 8 piece, 19 piece or 36 piece.

Interested individuals can shop and order the Gold Ballotin online in which case it is delivered within the shortest time possible. Godiva’s marketing strategy for the Gold Ballotin rests heavily on the quality of the product.

The company believes that by maintaining high quality the product markets itself as its recipe is unique. Packing also plays an important role in the marketing strategy. The packaging is attractive, stylish and shows sophistication and thus can easily catch the eyes of shoppers especially those shopping for gifts.

La Maison du Chocolat is another of Ki’s major competitors in the UK’s high-end chocolate market. It is a French company located in Nantere, France and which runs about 30 stores in metropolitan areas in Europe, North America and Asia. The company is distinctively known for its work with gourmet chocolate. The head chocolatier in La Maison du Chocolat revives old classical recipes in new products.

Two luxury products that stand out at La Maison du Chocolat are the French chocolate truffles and assorted chocolate box. La Maison du Chocolat’s French chocolate truffles are delicious confectionaries that can suit any special occasion. La Maison du Chocolat’s assorted chocolate box is a collection of chocolates prepared from the freshest French ingredients. The assorted chocolate box is a good choice for shoppers shopping for gifts.

One of La Maison du Chocolat strengths is its wide variety of high-end chocolate products that live a consumer spoilt for choice. As with Godiva La Maison du Chocolat marketing strategy rests heavily on the quality of product. The company’s chocolate is unique and needs to maintain its identity to the consumer.

This can only be done by ensuring high quality in the product. Packaging is also part of the marketing strategy. The packaging is done with an emphasis on attracting the customer’s eye particularly those shopping for gifts.

Analysis of Ki’s competitive position

The main way through which Ki will realize a competitive advantage over its competitors is in the newness and uniqueness of its product. Ki’s chocolate is 100% Mexican and as such is a new variety in UK’s high-end chocolate market.

Ki is to capitalize on this advantage while knowing that, first, high-end chocolate lovers want to indulge in new and/or classic chocolate tastes and second, it is important and essential to maintain high quality in its product as this is the only effective way of maintaining and enhancing the product’s unique identity.

Another way through which Ki will realize a competitive advantage over its competitors is in the uniqueness of its retail experience. Ki wants to offer a unique retail experience to its customers, specifically, those who purchase its chocolate in its retail outlet(s). Ki’s retail experience aims at making its chocolate a valuable and special item to the consumer or any individual shopping for the perfect gift.

The other way in which Ki will realize a competitive advantage over its competitors is in its moral standing. One of Ki’s moral values is respect for the environment, customer, employees, and all those involved in the creation to selling of its chocolates.

Ki’s main supplier of chocolate, Finca Cholula, maintains a high code of ethics and completely practises organic farming. Therefore, Ki’s customers will have the comfort of enjoying a product with high regard for human life and the environment.

Poor quality in its product and retail service will put Ki in a competitive disadvantage with its competitors. Ki’s main strength is in the uniqueness of its product and service. The most effective way for Ki to maintain and enhance this strength is by ensuring top quality in its product and retail service.

Top quality is essential in building productive public relations for a company and these are in turn essential in boosting the company’s financial performance. A weak and inefficient supply chain will put Ki in a competitive disadvantage with its competitors.

From the industry overview above, one critical success factor for companies in UK’s high-end chocolate industry is a robust and efficient supply chain as this enables meeting of customer demands at advanced levels.

Inability to meet customer demands causes customer dissatisfaction which in turn causes a decline in sales and eventually undermining of a company’s financial performance. Ki will have to ensure that it has a robust logistic strategy for it to realize this critical success factor.

Poor organizational structure and culture will put Ki at a competitive disadvantage with its competitors. Poor organizational structure and culture easily frustrates employees and kills they morale and commitment to a company. As such, it can cause a compromise on the quality of products and/or services an organization offers.

Poor organizational structure and culture is one of the major causes of employee turn over. Employee turnover, especially when it is external, can have detrimental effects to a company’s future.

External employee turnover occurs when an employee abandons his/her current employer to work for a different employer. In Ki’s case, external employee turnover can lead to a situation whereby the company’s trade secrets are revealed to its competitors and as such rendering it unable to compete.

Market segmentation

UK’s high end chocolate (or luxury chocolate market) has three main market segments, namely, convectional, Fair Trade and organic chocolate. Individuals who make up the Fair Trade market segment enter into fair Trade arrangements with chocolate producers.

These arrangements serve as guarantee to them that the producer will manufacture chocolate without human exploitation and while observing a high code of social, economical and environmental ethics. Fair trade chocolate is still a new concept but its demand is rising.

Individuals that make up the organic chocolate segment are those that are environmental conscious. Organic chocolate is produced from cocoa cultivated using organic methods and hence it is seen as environment-friendly chocolate.

Organic chocolate is expensive in comparison to convectional chocolate owing to the high cost of its raw material. Demand for organic chocolate is increasing as consumers become more aware of the environment. Fair Trade and organic chocolate concepts increase the sentimental value of luxury chocolate.

Individuals who make up the convectional chocolate market segment are those who do not pay any special attention to the production and farming of chocolate. They just want to buy high-end chocolate. Convectional chocolate is traditional chocolate.

Organic and Fair Trade chocolates are derivatives of convectional chocolate. Demand for convectional chocolate is falling as environmental awareness increases and as concern grows for the welfare of cocoa farmers.

At its start, Ki will be dealing in a number of products, namely, chocolate bars, flavoured chocolate truffles, solid chocolate, spiced chocolate and swarms of chocolate. Ki’s chocolate bar is a bar form confection that has 4 main ingredients, namely, cocoa solids, coca butter, sugar and milk. All these ingredients are 100% Mexican. Ki’s hard chocolate is hard and durable chocolate that is prepared using 100% Mexican cocoa butter.

Ki’s spiced chocolate is chocolate made from 100% Mexican cocoa and which is flavoured using Mexican spices. Ki’s chocolate truffles are confectionaries prepared by coating a filling (e.g. a nut, strawberries etc.) with chocolate made from 100% Mexican cocoa.

For chocolate bars, solid and spiced chocolate customers will choose among pre-packaged boxes. The package boxes will come in three sizes and for each size there will be two colours. Truffles and swarms will be packaged in brown bags. Hot chocolate will be sold in powder form; to prepare at home and in the store ready to drink.

The production and packaging of these products will be in Mexico. The key, unique and defining characteristic in all of these products is that the cocoa for making the chocolate will be 100% Mexican. None of the chocolate or chocolate products in the UK market today boasts of such uniqueness. The Ki will work on cash on delivery terms with its major supplier of chocolate, Finca Cholula.

Ki’s choice of this supplier is mainly out of the reason that the supplier uses organic farming to cultivate cocoa. This is important in selling its product to an environment conscious target market as seen above. Production of Ki’s chocolate and subsequent packaging will also be done at the supplier’s chocolate factory.

These will be done with respect to the directives that Ki will provide. The already finished products will be transported by air Mexico to the UK as freight twice in a week. This will ensure that Ki provides its customers with fresh products.

Pricing strategy

Taking into account the relevant factors e.g. product type and cost of production and selling, Ki will initially use a penetration pricing strategy and thereafter a premium pricing strategy. With the penetration pricing strategy the price of Ki’s high-end chocolate will be relatively lower to that of its competitors.

This will be a strategic move with the aim of building customer loyalty and ensuring that Ki gains market share in the mid or long term. The penetration pricing strategy is apt for Ki in the short-term as it enables the company to deal with competition from dominant companies and to steadily gain market share. A strength of the penetration pricing strategy is that it has the potential to increase a customer’s lifetime value.

This is because customers tend to have a bond with the initial product offering so much that if there is maintenance of high quality there is incremental willingness in them to buy additional products from the company.

In the long-term and when Ki secures an acceptable market share and a substantial competitive advantage the company will switch from the penetration pricing strategy to the premium pricing strategy. The reason for this is that Ki’s chocolate is a premium (or luxury) commodity. By switching to the premium pricing strategy the price of Ki’s chocolate will be slightly higher or lower than that of its competitors.

There will be gradual transition between these pricing strategies. This is because an abrupt and unexpected rise in price can create a negative impression on customers and consequentially cause plummeting sales and poor financial performance. The transition will be spread over a period of time that is sufficient to make price increases unnoticeable to the customers.

Ki will use various promotional strategies. Sampling (or promotional products) is one of the promotional strategies that Ki will use to promote its high-end chocolate product. With this promotional strategy Ki will organize a promotional event where potential customers will sample or try its product for free. The main advantage of this strategy is that the customers will try the product without any risk.

A disadvantage of it is that the promotional event will be expensive. Ki will also undertake point-of-purchase advertising in UK’s major retail stores such as Harrods, Selfridges and Liberty in which it will display its high-end chocolate product.

Discounting is another promotional strategy that Ki will use to generate customer demand for its product. Ki will offer a quantity discount to its customers. An advantage of discounting is that it encourages potential and price sensitive customers to try out a product. A disadvantage of discounting is that it is difficult to set an accurate limit to its usage.

Product promotion

Another promotional strategy that Ki will use is follow-up with clients (or customers). Ki will keep information about its customers in a database so as to keep in touch with them as often as is necessary. This will enable Ki inform its customers about new products and events.

Ki will also undertake specialty advertising whereby it will reward its loyal customers with different items e.g. T-shirts and pens with the company’s logo and trademark on it. This will enable Ki to preserve its loyal customers and at the same time attract new customers. An advantage of specialty advertising is that it makes customers feel appreciated.

A disadvantage of specialty advertising is that it can be quite costly to implement. Ki will advertise in electronic and physical media platforms. The marketing department will develop ads to run on television, radio and major internet search engines. The marketing department will also develop magazine ads to be printed in UK’s luxury magazines such as Lusso and GQ.

Product placement is another promotional strategy that Ki is intending to use to promote its product. More specifically Ki is interested in product placement in UK movies or music videos. Ki will seek to have its high-end chocolate brand placed in movie or music video scenes.

The reason for this is that movies and music reach a far greater audience and have the potential to build customer confidence on a particular brand. Ki product placements will target scenes that portray luxury. A disadvantage of this promotional strategy is that it is quite expensive to effect.

Distribution strategy

Ki will use both direct and indirect channels to distribute its high-end chocolate product. The direct channel that Ki will use is its own retail outlet and sales via the internet. The indirect channels that Ki will use are major retail outlets in the UK e.g. Harrods, Selfridges and Liberty. Ki’s customers will be able to make purchases over the internet.

This will be made possible by the company’s website which will have a portal specifically designed for carrying out online transactions. Ki’s customers will also be able to by its product directly from the company.

This will be made possible by the company’s own retail outlet, which the company will also use to host some of its promotional events e.g. sampling and point-of-purchase advertising. Ki’s indirect distributors that are mainly major retail outlets in the UK are vital entities in the company’s distribution strategy. The reason for this is that they are well-known and easily accessible to the UK public.

Aggregate production planning activities are undertaken in business organizations to enable them achieve a balance between capacity and demand in such a way that operating and production costs are minimized. Ki will use a level approach to aggregate production planning.

That is, it will meet its customer’s quantity demands by maintaining its rate of production at a constant and manage fluctuations in these demands by varying its inventory levels. The main advantage of the level strategy is that there is stability in worker level and production. Its disadvantage is that it results in relatively high costs of labor and inventory.

Operational plan

Location capacity and equipment.

The company intends to become a competitive high end chocolate brand in the United Kingdom. Specifically Ki wants to set up base in London as it finds these a strategic environment for a number of reasons. First and foremost the city is not only the capital of the kingdom but also its largest metropolitan area. In the wider European Union (EU), London is the largest urban zone.

The city’s Gross Domestic Product (GDP) is the fifth-largest in the world. London receives the most international visits than any other place in the planet. The city’s Heathrow airport serves the highest number of international passengers compared to all other airports and thus it is the busiest airport in the world (USA Today, 2012).

According to 2010 data, with a population of 7,825,200 people London is the most populated municipality in Europe and with a population of 8,278,251 people it is the second most populated urban area in Europe. London’s metropolitan area, which has a population ranging from 12 to 14 million people, is the largest in the EU.

The city generates 17% of UK’s GDP. London is associated with financial dealings of great global prominence and as such challenges New York’s position as the world’s most important financial hub. The city has the highest number of overseas banks which is 480. London hosts major global media companies such as the BBC and CNN.

London’s port, the second largest in the UK, handles approximately 45 Million tonnes of cargo annually. Tourism in London generates an annul revenue ranging between 7 and 10 million pounds. London’s workforce of about 9 million people is the largest in Europe. Continual improvement of the city’s telecommunications and transport infrastructure ensures that there are smooth supply chains and healthy competition.

Organizational structure and culture

Ki will be a hierarchal organization meaning it will use a hierarchical organizational structure. By this organizational structure Ki will have a single top authority entity with all other entities in the company being subordinate to it. Decision-making, will hence, be done from the top coming down. There will be clear definition of procedures and roles.

Though decision-making will be at the top Ki will integrate democracy in the organization and as such the top decision-maker will have to make consultations before reaching a particular decision. This arrangement is important for Ki as it wants to ensure that its staff members appreciate the decisions made and therefore, understand what they are doing.

An advantage that Ki will enjoy from the hierarchical structure is that authority in the company will be made obvious thus making it easy for employees to figure out who to approach when a problem arises. Another advantage that Ki will enjoy from the hierarchical system is that it facilitates the hiring of managers or heads who are adequately qualified and skilled and thus improves productivity of employees.

Another advantage of the hierarchical organizational structure is that it defines a clear promotional pathway for employees and as such they are highly motivated to reach to the next level. Another advantage of the hierarchical system is that it enhances departmental loyalty through building a team spirit among employees as they work to achieve a common goal.

A detriment that Ki may suffer as a result of the hierarchical system is organizational structure inflexibility, which will make the company sluggish in taking hold of new opportunities. Another detriment that Ki may suffer as a result of the hierarchical system is prolonged decision-making. This is because decisions will have to be made at the topmost organ of the company and as such may take time.

Another detriment that Ki may suffer as a result of the hierarchical system is reduced creativity and innovation in the company, which is as a result of its top-down decision-making arrangement that can easily frustrate the actuation of new ideas.

To deal with these shortcomings Ki will integrate a normative organizational culture that will promote a high level of ethics and critical thinking in the company.

A high code of ethics will promote professionalism in the company whereas critical thinking will boost objectivity and individual decision-making. Thus, communication in the company will be enhanced and employees will be properly equipped to maneuver around the organization structure in order to improve processes.

Ki will use a time rate system for payment of employee wages. Wages will be paid on a monthly basis. Thus, the wage an employee earns will be the product of the time he/or has worked and his/her wage rate per month. The wage rate per month will vary according to the position an employee fills and as such, there will be a wage increase as you move up the organization’s hierarchy.

An advantage of this wage plan is that it is simple to calculate and easy to understand. Another advantage of this wage plan is that it is useful to an organization like Ki which uses costly raw materials to get a quality product. Another advantage of this wage plan is that employees have a guarantee that they will receive a wage at the end of the month and as such feel that they are economically secure.

This is important in improving employee concentration on their jobs and productivity as well. Another advantage of the time rate system is that it does not discriminate among employees. Most trade unions actually prefer the time rate system for payment of employee wages.

A disadvantage of the time rate system is that it is a poor approach towards improving efficiency and increasing a company’s output. This is because with the time rate system, the amount of wage is not directly proportional to the amount of work done. Another limitation of the time rate system is that it does not provide an incentive for inefficient workers to improve on their efficiency and for efficient ones to maintain their efficiency.

Another limitation of the time rate system is that it supports idle time that in turn raises production costs. Another limitation of the time rate system is that it necessitates strict supervision of employees for acceptable quality standards to be achieved.

Business growth plan

Ki’s business growth plan has four steps. The first step is doing a diagnosis of the business. At this step an assessment of Ki’s business divisions is to be done with the aim of gathering detailed information. This will enlighten the company on what to change. Owing to the enormity of this task Ki will put up a planning team that will undertake it.

Ki’s business divisions that will be targeted in this exercise are marketing, human resources, operations and finance. The second step in Ki’s business growth plan is dependent on the results of the first step. The second step is shifting focus to key divisions and setting new goals.

This step involves a series of tasks that are, doing a SWOT analysis of the business, reviewing Ki’s values, vision and mission and doing weakness assessment. Goal setting in this step will be dictated by the company’s capacity to take up extra work and by the mnemonic “SMART”. The mnemonic implies that the new goals will have to be specific, measurable, achievable, realistic and time limited.

Having set new goals the third step in Ki’s business plan will be developing business strategies directed towards achieving the goals. This step will comprise development of marketing, human resource, operational and finance strategies. Ki notes that these strategies have direct and indirect impacts to each other and as such need managing in such a way they interferences are constructive.

The fourth step in Ki’s business plan is implementation. Having developed strategies in the third step the next logical step will be implementing them. Most likely the strategies will necessitate changes in Ki’s major business divisions and as such employees will have to be informed of the growth plan.

Quality plan

Maintaining high quality in its product is of fundamental importance to Ki. Ki actually identifies high product quality has one of its business’s critical success factors. To ensure high quality in its products Ki has a quality management plan in place. The plan clearly defines the acceptable quality standards and requirements that should be met in Ki’s operational processes and products.

The plan’s quality objective is “enhancing high-quality in Ki’s products in order to improve financial performance and competitiveness”. The plan targets at improving quality in all of Ki’s products and operational processes at budget-friendly expenditure. The plan also ensures that Ki’s products and work place processes at the worst conform to FSA standards and UK legislature respectively.

The plan outlines quality control activities e.g. sampling and lab testing that determine whether indeed Ki’s products meet the acceptable quality standards. The plan also outlines quality assurance activities which ensure that production and management processes are being followed to the letter and that they are effective in enhancing quality.

The plan also outlines the roles and responsibilities of each individual in the company in ensuring that quality is observed. Finally, the plan outlines the quality tools necessary for its implementation. These quality tools are cause and effect diagram, a check sheet and exploratory data analysis graphs e.g. histograms.

A robust and efficient supply chain is one of the critical success factors currently driving UK’s high-end chocolate industry. Robust and efficient supply chains enable meeting of customer demands at advanced levels. To realize this critical success factor Ki will have to ensure that it has a robust logistic strategy or strategies. Two factors will determine the choice of logistic strategy that Ki will use at a particular time.

The first factor is the performance-effectiveness of the logistic strategy and the second is its cost-effectiveness. A logistic strategy is performance-effective when it enables a company to adapt well to the flexibility of its supply chain. A logistic strategy is cost effective when its creation and implementation results in optimal yields at reduced and necessary expenditure.

Ki’s current logistic strategy involves the hiring of a 3pl logistics company as it is unable to fulfill all the functions of its supply chain. Ki will work with DHL as its 3PL logistics company.

If the supply chain becomes weak Ki will consider the services of a 4pl logistics company, which will ensure that customers receive products on time and the quality of products is maintained. 4PL companies review a company’s supply chain to identify the problems that are causing customer dissatisfaction.

Financial data and plans

Ki’s funding will be done by the owners of the company. These individuals have through their own means raised a capital of £150,000 to fund Ki’s operations.

SWOT and business risk analysis

One of Ki’s strength is the uniqueness of its product as this will be instrumental in attracting buyers. Another of Ki’s strength is its brand approach to business. This approach will be instrumental in generating customer confidence on its product. Ki’s industry is another of its strengths. The high-end chocolate industry is resilient.

Even with the global recession hitting hard, surprisingly, consumers found high-end chocolate an affordable luxury. Another of Ki’s strengths is its time of entry into the market.

Ki is entering UK’s high-end chocolate market at a time when the kingdom’s economy is stabilizing from the recent global economic crisis and as such disposable incomes are on a rise and so is consumer purchasing power. Another of Ki’s strengths is its robust business plan. This is a comprehensive plan covering the company’s entry into the market up to its growth.

One of Ki’s outstanding weaknesses is its concentration on the UK market only. This is the age of globalization and as such Ki should venture into new markets especially the Asian market where chocolate is increasingly becoming popular.

Another of Ki’s weaknesses is its focus on high-end chocolate only. Ki should try other chocolate products and see how they fair. Another of Ki’s weaknesses is the company’s dependence on a single supplier of chocolate, Finca Cholula.

One of Ki’s opportunities for lies in innovative products. UK consumers are increasingly becoming health conscious and as such there is opportunity for healthy high-end chocolate products. Another of Ki’s opportunities lies in new markets such as Asia, where as mentioned, chocolate popularity is on a rise.

Ki’s entry into such markets at such an early stage can see it gain a huge market share in the mid or long term. Another of Ki’s opportunities lies in mergers with bigger companies such as Nestlé, Kraft or Mars. Such mergers will give Ki a much needed competitive advantage and capital boost to improve its operations.

One threat that Ki faces is potential political instability in Mexico following drug wars in the country. Such instability will most likely cause the price of cocoa to go up and as such increase Ki’s operational expenditure, which will consequentially reduce the company’s profits.

Another threat that Ki faces emanates from the increasing health consciousness in the UK, which has the potential to impact significantly and negatively on Ki’s sales. Another threat that Ki faces is the increasing complexity in supply chains.

Supply chains are becoming more complex as consumer demands change. Ki will have to make sure that it tunes itself to meet the requirements of its supply chain or else it will be unable to meet its customers’ demands.

Internal audit

Ki’s internal audit model is risk-focused. The audit begins and ends in the finance and operations divisions. The first step in the audit is the identification and understanding of specific risks associated with finance and operations.

The second step in the internal audit is formulating a definition for acceptable levels of these risks. The third step in the internal audit is the formulation of a internal audit function that comprehensively encompasses the expertise needed to sufficiently track, measure and manage these risks.

External audit

Ki’s external audit is a review of the company’s financial statements by a third party who has no affiliation whatsoever with Ki. Ki’s external audit will be done annually before 31st of each year as is required by UK legislature (Crown, n.d.). Ensuring that Ki’s financial statements are in order and giving an unbiased view of the company’s financial state will be the major functions of the company’s external auditing activity.

The audit will conclude with the preparation of an external audit report conveying the findings of the independent auditor. Any inconsistency uncovered by the independent auditor will be outlined in the external audit report.

Risk identified

One of the operational risks identified is the varying and uncertain cost of cocoa in Mexico due to potential political instability in the country arising from drug wars. Another risk identified is increasing supply chain complexity that is driven by changing customer demands. Another risk identified is poor sales as a result of increasing health consciousness in the UK.

Another operational risk identified is Ki’s dependency on a single chocolate supplier. One financial risk identified is an increase in foreign exchange rates and/or a decrease in interest rates.

Another financial risk identified is increased competition risk which can cause plummeting sales. Another financial risk identified is the tax risk. Ki will have to comply with Mexican tax laws and those of the UK. This may prove to be quite costly.

Risk addressed

The risk of supply chain complexity has been addressed by Ki’s logistic strategy, which accommodates the services of 3pl logistics companies and if needed 4pl logistics companies as well. The risk of poor sales as a result of increasing health consciousness in the UK has been addressed by the Ki’s organizational culture which promotes innovativeness.

Innovativeness in the company will also address the competition risk to a limited extent. Ki will ensure that it maintains a healthy and productive relationship with banks and other lending institutions. As such, the company will have addressed the risk arising from increases in foreign exchange rates and/or a decrease in interest rates.

Risk and contigency evaluation

Ki will use a qualitative or subjective approach towards risk evaluation. In this way the company will rely on an expert’s (e.g. internal auditor’s) opinion on the riskiness of a particular situation. The expert will also enlighten Ki on the severity of the risk if it was to occur. Risks will be prioritized as very high, high, medium or low depending on severity, that is, the extent of potential loss they can actuate if they occurred.

Table 1 in the appendix A shows Ki’s risk severity classification. Ki’s risks will also be classified according to frequency of occurrence.

This classification is shown in table 2 of appendix A. Ki’s contingency evaluation will use the expected monetary value (EMV) and will consider groups of risks and not individual high impact or priority risks. The magnitude of the expected monetary value will enlighten Ki on the level of contingency planning and funding required.

Are UK consumers becoming more health conscious , 2012. Web.

BBC 2012, Economy tracker: gdp . Web.

BBC 2012, Economy tracker: inflation . Web.

BBC 2012, Economy tracker: interest rates . Web.

Business Link 2012, UK trade tariff . Web.

Chocolate Devine Ltd 2011, Chocolate facts . Web.

Crown, About us . Web.

Crown, Audit commission act 1998 . Web.

Dow Jones Newswires 2012, Nestle launches luxury designer chocolate business to target premium consumers . Web.

Fletcher, A. 2007, Are UK consumers becoming more health conscious , viewed 29.

Market Oracle Ltd. 2012, UK population growth and immigration trend forecast 2010 to 2030 . Web.

Nestlé 2012, Nestlé’s new Maison Cailler brand creates chocolate haute couture . Web.

Reuters 2012, Currencies quote . Web.

Sena, M. 2012, Chocolate industry analysis 2012 – cost & trends . Web.

The Times 100 2012, From bean to bar – the production process . Web.

USA Today 2011, London-Overview . Web.

Table 1: Risk classification according to severity.

Table 2: Ki’s risk classification according to frequency.

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IvyPanda. (2019, June 5). Chocolate Business Plan. https://ivypanda.com/essays/chocolate-business-plan/

"Chocolate Business Plan." IvyPanda , 5 June 2019, ivypanda.com/essays/chocolate-business-plan/.

IvyPanda . (2019) 'Chocolate Business Plan'. 5 June.

IvyPanda . 2019. "Chocolate Business Plan." June 5, 2019. https://ivypanda.com/essays/chocolate-business-plan/.

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Bibliography

IvyPanda . "Chocolate Business Plan." June 5, 2019. https://ivypanda.com/essays/chocolate-business-plan/.