Bakery Feasibility Template

8/3/2019 Bakery Feasibility Template

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Feasibility Assessment Template

Developed for: Ag Marketing Resource Center

Developed by: Phil Kenkel and Rodney Holcomb, Oklahoma State U

This templates is designed to assist you in assessing the feasibility of a projInput cells are shaded in blue.

Each sheet is currently projected allowing you to only input information in th

The template can also be modified and expanded to meet your particular situIf you choose to modify the template we would advise you to save it under an

To get started go to the "Input Page"

For comments or suggestions contact: Phil Kenkel, [email protected] 405-744-9818'


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iversity

ct

input cells.

tion by turning off the projection.other name and retain the original for reference.


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INPUT CAPITAL STRUCTURE AND INPUT PRODUCTS, INITIAL VOLEXPENSE INFORMATION ANTICIPATED SALES GROWTHPercent Financed 60.00% Product Name BreadLong Term Interest Rate 8% Units lbsLoan Term 10 Initial Volume 3,225,000

Total Plant Property & Equip $5,779,500 Sales growth 1%Loan Amount $3,467,700 Price/unit 1.30$Working Capital $1,000,000Short Term Interest Rate 6% Product Name B

Units lbs

Tax Information Initial Volume 0Property Tax as % of Prop and Plant 0.50% Sales growth 0%Insurance/Total PPE 2.00% Price/unit -$Income Tax Rate 50.00%

Payroll Information VARIABLE COST OF PRODUCTI

% of Payroll Tax to Salaries 1% Product Unit

% of Retirement Tax to Salaries 15.00% Inputs $/lb% of Employee INS Tax to Salaries 68.00% Packaging $/lbBenefits as % of Salaries 30.00% Cost #3 $Wage Inflation 1.00% Cost #4 $

Bread lbs

Utilities

Electricity/month 10,000$ Product UnitWater/month 250$ Cost #1 $Gas/month 500$ Cost #2 $Telephone/month 200$ Cost #3 $

Total Utilities 10,950$ Cost #4 $B lbs

OtherExpense Inflation Rate 1.00%Maintenance as % of Plant & Equip 3%

Insurance as % of Plant & Equip 2% There are also inputs on the "PersonnelDiscount rate for NPV calculation 8%


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ME, MARGIN PER UNIT ANDATE

Product Name CUnits lbs

Initial Volume 0

Sales growth 0%Price/unit -$

Product Name DUnits lbs

Initial Volume 0

Sales growth 0%

Price/unit -$

N PER UNIT

VC/unit Product Unit VC/unit

0.16$ Cost #1 $ -$0.12$ Cost #2 $ -$-$ Cost #3 $ -$-$ Cost #4 $ -$

0.28$ C lbs -$

VC/unit Product Unit VC/unit-$ Cost #1 $ -$-$ Cost #2 $ -$-$ Cost #3 $ -$

-$ Cost #4 $ -$-$ D lbs -$

Expense" and "Depreciation" sheets


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Depreciation Return On Investment

Quality Percent 0%

Discount Rate 0.00%


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This sheet summaries the volume and price and sales growth information from the input page. T

Sales ProjectionsYear 1 Year 2 Year 3 Year 4 Year 5

Bread lbs 3,225,000 3,257,250 3,289,823 3,322,721 3,355,948B lbs 0 0 0 0 0

C lbs 0 0 0 0 0D lbs 0 0 0 0 0

3,225,000 3,257,250 3,289,823 3,322,721 3,355,948Gross Margin Projection

Year 1 Year 2 Year 3 Year 4 Year 5BreadTotal Volume 3,225,000 3,257,250 3,289,823 3,322,721 3,355,948

Margin/Unit $1.30 $1.30 $1.30 $1.30 $1.30Gross Margin/Unit $4,192,500 $4,234,425 $4,276,769 $4,319,537 $4,362,732

BTotal Volume 3,225,000 3,257,250 3,289,823 3,322,721 3,355,948

Margin/Unit $0.000 $0.000 $0.000 $0.000 $0.000

Gross Margin/Unit $0 $0 $0 $0 $0

CTotal Volume 0 0 0 0 0

Margin/Unit $0.00 $0.00 $0.00 $0.00 $0.00


DTotal Volume 0 0 0 0 0

Margin/Unit $0.00 $0.00 $0.00 $0.00 $0.00


TOTAL GROSS MARGIN $4,192,500 $4,234,425 $4,276,769 $4,319,537 $4,362,732

Production ExpenseBread 906,225$ 915,287$ 924,440$ 933,685$ 943,021$

B -$ -$ -$ -$ -$C -$ -$ -$ -$ -$D -$ -$ -$ -$ -$TOTAL VARIABLE EXP. 906,225$ 915,287$ 924,440$ 933,685$ 943,021$


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here is no input on this page.

Year 6 Year 7 Year 8 Year 9 Year 103,389,507 3,423,402 3,457,637 3,492,213 3,527,135

0 0 0 0 0

0 0 0 0 00 0 0 0 0

3,389,507 3,423,402 3,457,637 3,492,213 3,527,135

Year 6 Year 7 Year 8 Year 9 Year 10

3,389,507 3,423,402 3,457,637 3,492,213 3,527,135

$1.30 $1.30 $1.30 $1.30 $1.30$4,406,360 $4,450,423 $4,494,927 $4,539,877 $4,585,276

3,389,507 3,423,402 3,457,637 3,492,213 3,527,135$0.000 $0.000 $0.000 $0.000 $0.000

$0 $0 $0 $0 $0

0 0 0 0 0$0.00 $0.00 $0.00 $0.00 $0.00

$0 $0 $0 $0 $0

0 0 0 0 0$0.00 $0.00 $0.00 $0.00 $0.00

$0 $0 $0 $0 $0

$4,406,360 $4,450,423 $4,494,927 $4,539,877 $4,585,276

952,452$ 961,976$ 971,596$ 981,312$ 991,125$

-$ -$ -$ -$ -$-$ -$ -$ -$ -$-$ -$ -$ -$ -$

952,452$ 961,976$ 971,596$ 981,312$ 991,125$


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This sheet calculates loan amortization and interest. There are no inputs on this sheet.

Total Investment $5,779,500

Long Term Interest Rate 8.00%

Percent Financed 60.00%

Loan Amount $3,467,700

Loan Term 10

Year 1 Year 2 Year 3 Year 4 Year 5

Beginning Balance $3,467,700 $3,228,326 $2,969,803 $2,690,598 $2,389,056

Interest Rate 8.00% 8.00% 8.00% 8.00% 8.00%

Interest $277,416 $258,266 $237,584 $215,248 $191,124

Annual Payment $516,790 $516,790 $516,790 $516,790 $516,790Principal $239,374 $258,523 $279,205 $301,542 $325,665

Ending Balance $3,228,326 $2,969,803 $2,690,598 $2,389,056 $2,063,391

Working Capital $1,000,000

Short Term Interest Rate 6.00%

Interest Amount $60,000

Total Interest Expense $337,416 $318,266 $297,584 $275,248 $251,124


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Year 6 Year 7 Year 8 Year 9 Year 10$2,063,391 $1,711,673 $1,331,817 $921,573 $478,509

8.00% 8.00% 8.00% 8.00% 8.00%$165,071 $136,934 $106,545 $73,726 $38,281

$516,790 $516,790 $516,790 $516,790 $516,790$351,718 $379,856 $410,244 $443,064 $478,509

$1,711,673 $1,331,817 $921,573 $478,509 $0

$225,071 $196,934 $166,545 $133,726 $98,281


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This sheet allows you to input salaries and overtime assumptions for various positions.

Benefit calculations are based on the percentage you entered on the "Input" sheet.

Occupation # Employees Salary Total Salaries Benefits Overtime%

General/ Administration 4 $153,894 $193,894 $58,168 5%

General Manager 1 $100,000 $100,000 $30,000Administrative Assistant 2 $40,000 $80,000 $24,000

Other 1 $13,894 $13,894 $4,168Transportation 1 $40,716 $40,716 $12,215 5%Customer Service 1 $55,882 $55,882 $16,764 5%

Sales/Marketing 1 $221,958 $221,958 $66,587 5%Operators 80 $2,638,876 $2,638,876 $791,663 5%

Bread Processing 60 $32,986 $1,979,157 $593,747Packaging 20 $32,986 $659,719 $197,916

Sanitation 1 $67,656 $67,656 $20,297 5%Plant Management 1 $30,782 $30,782 $9,234 5%

Total Personnel $3,209,763 $1,824,760Costs


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Overtime Total

11,730.50$ $263,793

100,993.65$ $153,92435,780.03$ $108,426

14,480.70$ $303,026133,482.88$ $3,564,022

3,382.81$ $91,3361,539.08$ $41,555

$301,390 $4,526,082


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This Sheet summaries expenses. The only input is for "supplies and miscellaneous" expenses.

Labor Year 0 Year 1 Year 2 Year 3 Year 4Salaries $3,209,763 $3,241,861 $3,274,279 $3,307,022 $3,340,092

Benefits $1,824,760 $1,843,008 $1,861,438 $1,880,052 $1,898,852

Overtime $301,390 $304,404 $307,448 $310,522 $313,627

Total Labor $5,335,913 $5,389,272 $5,443,164 $5,497,596 $5,552,572

Production Expenses $906,225 $915,287 $924,440 $933,685

Utilities $131,400 $132,714 $132,714 $132,714

Total Variable $6,426,897 $6,491,166 $6,554,750 $6,618,971

FixedMaintenance 170,385$ $172,089 $173,810 $175,548

Insurance 113,590$ $114,726 $115,873 $117,032

Property Tax 115,590$ $116,746 $117,913 $119,092

Depreciation $951,110 $693,545 $509,570 $378,211

Interest $337,416 $318,266 $297,584 $275,248

Total Fixed $1,688,091 $1,415,371 $1,214,750 $1,065,131

OtherSupplies $0 $0 $0

Miscellaneous $0 $0 $0

Total Other $0 $0 $0 $0

Total Expenses $8,114,987 $7,906,537 $7,769,500 $7,684,102


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Year 5 Year 6 Year 7 Year 8 Year 9 Year 10$3,373,493 $3,407,228 $3,441,300 $3,475,713 $3,510,471 $3,545,575$1,917,841 $1,937,019 $1,956,390 $1,975,954 $1,995,713 $2,015,670

$316,764 $319,931 $323,130 $326,362 $329,625 $332,922

$5,608,098 $5,664,179 $5,720,820 $5,778,029 $5,835,809 $5,894,167

$943,021 $952,452 $961,976 $971,596 $981,312 $991,125

$132,714 $132,714 $132,714 $132,714 $132,714 $132,714

$6,683,833 $6,749,344 $6,815,511 $6,882,339 $6,949,835 $7,018,006

$177,303 $179,076 $180,867 $182,676 $184,503 $186,348

$118,202 $119,384 $120,578 $121,784 $123,002 $124,232

$120,283 $121,486 $122,701 $123,928 $125,167 $126,419

$378,579 $214,106 $50,000 $50,000 $50,000 $0

$251,124 $225,071 $196,934 $166,545 $133,726 $98,281

$1,045,493 $859,124 $671,080 $644,933 $616,397 $535,279

$0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0

$7,729,326 $7,608,468 $7,486,591 $7,527,272 $7,566,232 $7,553,285

0.00%

0.00%


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This sheet summaries income, expenses and net profit. There are no inputs on this sheet

Gross MarginsYear 0 Year 1 Year 2 Year 3 Year 4 Year 5

Bread $0 $4,192,500 $4,234,425 $4,276,769 $4,319,537 $4,362,732

B $0 $0 $0 $0 $0 $0

C $0 $0 $0 $0 $0 $0D $0 $0 $0 $0 $0 $0

Total $0 $4,192,500 $4,234,425 $4,276,769 $4,319,537 $4,362,732

ExpensesVariable $0 $6,426,897 $6,491,166 $6,554,750 $6,618,971 $6,683,833

Fixed $0 $1,688,091 $1,415,371 $1,214,750 $1,065,131 $1,045,493

Other $0 $0 $0 $0 $0 $0

Total Expenses $0 $8,114,987 $7,906,537 $7,769,500 $7,684,102 $7,729,326

Before Tax Profit $0 ($3,922,487) ($3,672,112) ($3,492,731) ($3,364,565) ($3,366,594)

Tax -$ (1,961,244)$ (1,836,056)$ (1,746,365)$ (1,682,283)$ (1,683,297)$

After Tax Profit $0 ($1,961,244) ($1,836,056) ($1,746,365) ($1,682,283) ($1,683,297)


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Year 6 Year 7 Year 8 Year 9 Year 10$4,406,360 $4,450,423 $4,494,927 $4,539,877 $4,585,276

$0 $0 $0 $0 $0

$0 $0 $0 $0 $0$0 $0 $0 $0 $0

$4,406,360 $4,450,423 $4,494,927 $4,539,877 $4,585,276

$6,749,344 $6,815,511 $6,882,339 $6,949,835 $7,018,006$859,124 $671,080 $644,933 $616,397 $535,279

$0 $0 $0 $0 $0

$7,608,468 $7,486,591 $7,527,272 $7,566,232 $7,553,285

($3,202,108) ($3,036,167) ($3,032,344) ($3,026,356) ($2,968,010)

(1,601,054)$ (1,518,084)$ (1,516,172)$ (1,513,178)$ (1,484,005)$

($1,601,054) ($1,518,084) ($1,516,172) ($1,513,178) ($1,484,005)


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This sheet calculates depreciation. You enter descriptions and values for buildings, equipment

DepreciationBuildings 39 year Straight Line

Special Purpose Buildings 10 year Straight Line

Equipment and Heavy Rollin 7 Yr MACRS with half year convention

Light Trucks and Vehicles 5 Yr MACRS with half year convention

Buildings Special Purpose BDescription Value

#1 Plant 2,000,000$ #1#2 #2#3 #3#4 #4

#5 #5Total Buildings 2,000,000$ Total Special Purp

Equipment and Heavy Rolling Stock Light Trucks andDescription Value#1 Flour System 200,000$ #1#2 Bread Line 1,554,500$ #2#3 Bun Line 1,460,000$ #3#4 Bread and Bun Pans 100,000$ #4#5 Miscellaneous 365,000$ #5

Total Equip and Heavy Rolling Stock 3,679,500$ Total Light Trucks

Total Plant Property and Equipment 5,679,500$Land 100,000$Total Land, Plant Property and Equipment 5,779,500$

Annual Total Depreciation

Year 1 2 3 4Buildings $50,000 $50,000 $50,000 $50,000Special Purpose Buildings $0 $0 $0 $0Equipment and Heavy Rolling S $525,801 $901,110 $643,545 $459,570

Light Truck and Vehicles $0 $0 $0 $0

Total Depreciation $575,801 $951,110 $693,545 $509,570

Buildings 39 year Straight LineSpecial Purpose Buildings 10 year with percentage from table

Equipment and Heavy Rollin 7 year with percentage from table

Light Trucks and Vehicles 5 year with percentage from table

BuildingsCost $2,000,000Life 20


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Salvage $1,000,000Period 20Depreciation per year for 39 ye $50,000

Special Purpose BuildingsCost $0

Life 10

Year Depreciation Rate1 $0 10%2 $0 14%3 $0 14%4 $0 14%5 $0 14%

6 $0 14%7 $0 14%8 $0 14%

9 $0 14%10 $0 14%

Equipment and Heavy Rolling StockYear Depreciation Rate

1 $525,801 14.29%2 $901,110 24.49%3 $643,545 17.49%4 $459,570 12.49%5 $328,579 8.93%6 $328,211 8.92%7 $328,579 8.93%8 $164,106 4.46%

Light Trucks and VehiclesYear Depreciation Rate

1 $0 20.00%2 $0 32.00%3 $0 19.20%4 $0 11.52%5 $0 11.52%6 $0 5.76%


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and other property.

uildingsDescription Value

se Building -$

ehiclesDescription Value

and Vehicles -$

5 6 7 8 9 10$50,000 $50,000 $50,000 $50,000 $50,000 $50,000

$0 $0 $0 $0 $0 $0$328,211 $328,579 $164,106

$0

$378,211 $378,579 $214,106 $50,000 $50,000 $50,000

0.0613


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This sheet summaries the feasibility of the project. It provides net present value, benefit cost ratio and

The only input is the discount rate.

Discount Rate 12.00%

Year 0 1 2 3

Gross Margin $4,192,500 $4,234,425 $4,276,769Discount Factor 1 0.892857143 0.797193878 0.711780248PV of Income $43,862,826 $0 $3,743,304 $3,375,658 $3,044,120

Total Expense $5,779,500 $8,114,987 $8,114,987 $7,906,537

Less Depreciation and Interest $1,288,526 $1,011,811 $807,154

Cash Expenses $5,779,500 $6,826,462 $7,103,177 $7,099,383

Discount Factor 1 0.892857143 0.797193878 0.711780248

PV of Expenses $77,712,186 $5,779,500 $6,095,055 $5,662,609 $5,053,201

Benefits Less Costs ($5,779,500) ($2,633,962) ($2,868,752) ($2,822,614)

PV Benefits Less PV Costs ($5,779,500) ($2,351,752) ($2,286,951) ($2,009,081)

Total PV of Income 24558187.68

Total PV of Expenses $46,127,879

Net Present Value ($21,569,691)

Internal Rate of Return #NUM!

PV Benefit/PV Cost Ratio 0.53


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internal rate of return

Bakery Feasibility Template

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