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By:

Kally Schlemko

Jenn Schmidt&

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Cupcakes & Wedding

Cakes

Vanilla Cake with Lemon Icing

Chocolate Cake with Peppermint Icing

Chocolate Cake with Peanut Butter Icing

Vanilla Cake with Vanilla Icing

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Critical Factor

Sales!

Sales!

Sales!

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138 – 1820 McOrmond Drive

University Heights Square

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Why University Heights Square?

• Surrounded by 7 neighborhoods with a combined population of 45,000+ (Source: City of Saskatoon)

• The surrounding neighborhoods have an average household income of $85,704 (Source: City of Saskatoon)

• Next to 2 high traffic streets; Attridge Drive and McOrmond DriveStreet 2009 (estimated) 2014 (projected)

McOrmond Drive 183 vehicles/hr 1117 vehicles/hr

Attridge Drive 738 vehicles/hr 1073 vehicles/hr

(Source: Stantec Consulting Ltd)

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Direct CompetitionThe Cupcake

CornerThe Cupcake Conspiracy

$3.00/ Cupcake $2.50/ Cupcake

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Indirect Competitors

Safeway

Starbucks

$ 1.50/ Cupcake $1.95/ Mini Cupcake

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Profit Margin

Price: $3.00Cost: $0.27

Profit Margin: 91%

Price: $700Cost: $104.58Profit Margin:

85%

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Customer Growth

Expected Revenues

2012 2013 2014 2015 2016

Number of Customers/Day

30 36 40 42 42

Numbers of Days/Year 350 350 350 350 350

Average Purchase/Customer

$18.00 $18.45 $18.91 $19.38 $19.87

Total Sales $189,000

$232,470 $262,110 $282,09

6$294,93

1

2012 2013 2014 2015 2016

25% 20% 10% 5% 5%

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Marketing

2012 2013 2014 2015 2016

Radio $12,090

$12,090 $9,067 $6,045 $3,022

Newspaper $4,567 $4,567 $3,425 $2,283 $1,141

Website $950 $200 $200 $200 $200

Print Ads $2,000 $2,000 $1,500 $1,000 $1,000

Signage $3,000 $3,000 $3,000 $3,000 $3,000

Yellow Pages $240 $240 $240 $240 $240

Total $22,847

$22,097

$17,432

$12,768

$8,603

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Breakeven Analysis

1 2 3 4 505

1015202530354045

30

3640 42 42

31 31 29 28 27Base CaseBreakeven

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Return on Investment

NPV: $82,891

Required Rate of Return: 25%

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