HNY.
01.
05.
Executive Summary
Operational Plans
02. General Business Description
06. Management and Organisation
03.
07.
Products and Services
Start Up Expenses
04.
Financial Plan
08.
Marketing Plan 2
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01. Executive Summary The British honey bee population has been heavily exploited in recent years in order to satisfy growing demands for honey in the UK, with sales worth an approximate ÂŁ109.8m in 2015. This exploitation has however lead to a rapid decline in honey bee populations due to overworking and poor hive management, meaning that more and more honey is having to be sourced from outside the UK and EU. (Benjamin, A. 2015). HNY. is a business producing and selling honey that is dedicated to conserving and improving the British honey bee population through the practice of small scale, ethical beekeeping methods combined with the education of consumers. It is a Private Limited
Company which offers protection against any personal liability and adds credibility the the business, as well as allowing the opportunity for members of the company to become shareholders. The company aims to expand exponentially within it’s first few years of trade, achieving a net profit of approximately £27,000 within the first year, followed by increasing growth percentages with each year going forward. Overall, HNY. aims to achieve not only financial growth and benefits, but also has strong ambitions to help achieve a healthier, happier and thriving British honey bee population in the years to come.
This plan details the various attributes and strengths of HNY. that will lead to the successful start up of the business, as well as initial and ongoing challenges to be faced along the way. 3
Mission Statement
“The HNY. brand aims to conserve, protect and encourage the British bee population, by providing high quality honey products to its customers in both an educational and ethical manor.”
02. General Business Description Elevator Pitch At HNY. we produce delicious and high quality honey, made by healthy and happy honey bees. Unlike other similar companies, we value the education of our customers just as much as we do our bees, and believe that by educating consumers about what we do, we can help the honey bee population to thrive. Making a difference, one jar of honey at a time.
Business Philosophy Honey bees are all too often heavily exploited for their honey and wax products, resulting in declining populations and lower quality products.
At HNY. being a small scale local business allows us to pay careful attention to our honey bees and ensure that they are looked after properly, which in turn provides us with great quality honey from a happy and healthy bee population. The HNY. store provides a local hub for us to spread the word about the importance of the honey bee and ethical beekeeping on a smaller scale.
Business Goals Throughout its first year, the company aims to focus most of its development on social media, advertising and communication, as this will have a lasting effect once it is successfully managed. This communication will be vital for
building a relationship with customers and establishing a customer base. Initial business goals for HNY. are to achieve a net profit of £27,200 by the end of its first year of trade.
The company hopes to expand to perhaps more than one store, or have several concessions throughout shops in Sheffield and the Peak District.
HNY. then aims to achieve a net profit of £63,100 by the end of its second year. By the end of year 3, the company aims to be producing honey from 250 hives. In the long term the company aims to achieve a level of exponential production and profit growth, looking for the business to successfully pay off an initial start up loan of £50,000 and expand accordingly. HNY. aims to have an expanding loyal customer base, as well as developing thriving relationships with new customers on a regular basis.
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03. Products and Services The Honey The HNY. store primarily sells 8oz jars of 4 main varieties of honey, and 1oz beeswax bars.
methods, and how customers can and do make a difference to the welfare of the honey bee.
The honey comes from bees that are locally kept throughout the Peak District in areas with different plants and foliage.
This is done by either the director or a shop assistant, who will ideally have extensive knowledge of the HNY. company, and/or beekeeping in general.
This produces the different varieties of honey and helps to ensure that there will be honey production all year round, depending on which plants are in bloom at different times.
The Store
Education As the company expands, the store will become more of an educational hub or centre for anyone wanting to learn different aspects of beekeeping - serving as a place for school visits, educational talks and workshops.
The store also provides a place where information can be passed on between experts, enthusiasts and shoppers about what the company does, different ethical beekeeping
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04. Marketing Plan
ÂŁ109.8m Market Size and Worth The UK is one of the key honey markets within the European Union, and accounted for 13% of the total consumption of honey within the EU in 2009. The industry has grown both in the UK and EU since, however elements such as disease and poor weather can counteract production progress in the UK at certain points throughout the year. (Ministry of Foreign Affairs, N/A). There are many different reasons for the growth in honey sales over recent years, including promotions of the health benefits of honey as a replacement for white cane sugar and greater advertising on how honey can be used as more than just “spread for toastâ€?.
UK honey sales in 2015 (Salter, K. 2015)
25,000 Tonnes of honey consumed in the UK every year (de Zylva, P. N/A)
45%
This trend of using honey for its health benefits has increased over the last few years, resulting in more research being done into not only the wellbeing of consumers, but also the wellbeing of the bees producing our honey.
Increase in globally farmed honey bee colonies (de Zylva, P. N/A)
This supports the idea of generating more small scale beekeeping businesses, allowing for greater attention to be paid to the production, quality and welfare of the bees and honey they produce. (Salter, K. 2015).
5.2 million
Trends and Current Demand
Number of UK small firms in 2015 (Lord Young, 2015)
Another factor to support the small scale beekeeping industry is the rise in the number of small, independent businesses that has occurred within the UK over the last 7 years. This sector has also increased by 17% since 2010, with a record number of start ups in 2011 and a record increase in the number of small firms in early 2014. (Lord Young. 2015). Currently only 6% of honey consumed in britain is produced by British beekeeping alone each year. This is due to the rapid decline of commercial honey bee populations, which have almost halved since 2010.
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Growth Potential Starting off small is not only generally safer than trying to set up a larger business straight away in case things go wrong, but it also provides a wide range of opportunities for growth.
92%
Initially the company’s growth will be focused on establishing a growing customer base, as well as developing a strong presence on social media. Social media is a great platform for developing customer relationships, by providing somewhere for businesses to showcase their development every day and giving consumers the opportunity to easily communicate and make contact with the company whenever they like.
“Within two years, more than 50 percent of small businesses agree social media helps them increase sales; within five years, 70 percent of small businesses see ROI from a social media presence.” (Olenski, S. 2015). As the company progresses, the range of products on offer has lots of potential to diversify and expand. This includes an increase in the number of flavours and types of honey produced, as well as using the honey as an ingredient in items such as food, drink and cosmetics. The same applies for beeswax which can be used to produce a large variety of other products like shoe polish, candles and cosmetics also. However, wax and honey aren’t the only substance produced by honey bees that can be used; propolis (or “bee glue”) is a substance produced by honey bees that is widely renowned for its health benefits and antibacterial properties (King, M. 2015). This growth in the number of beehives will increase the amount of honey and
Of marketers working with small businesses (between two and 10 employees) agree or strongly agree that social media is crucial to their marketing efforts.” (Olenski, S. 2015). beeswax produced and allow for more products to sell, and is cheaper than buying in new colonies to increase this production. New colonies can also be sold as opposed to being used for harvesting. Pollen is another product of beekeeping and is a popular and healthy addition to meals, known also for it’s health benefits. (Mercola, J. 2017). All of these provide directions for the HNY. company’s product range to grow and diversify into, as the business itself expands. Education is a core element of the business and is one of the main services that the company offers. Initially this will be provided through in store advice, social media and marketing, however as the business grows this will become more of an established and integral part of how the HNY. store functions.
The store can develop to allow for educational talks and workshops to take place, as well as school trips and other events tailored to a wide range of audiences. The HNY. store aims to become more than just a place to shop for honey bee produce, but to become somewhere where people can visit to learn about the products they are buying and where they come from, how they are produced, and how the HNY. business is helping to conserve and look after the British honey bee population. Honey bee colonies naturally split anywhere unto 5 times per year and, although a percentage of these will not be successful, it naturally allows the business to expand and grow in terms of honey production by providing new hives and adequate care for the growing number of colonies each year. (Burns, D. 2007).
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Barriers to Entry
As with all businesses starting out, there will be certain elements that cause initial or ongoing set backs within the company. For HNY. these will mainly be based around the honey bees themselves, and different factors affecting the hives. Weather can have a huge impact on honey production and hive survival, with 14% of England’s honey bee colonies dying over the course of the
winter in 2015, according to a study conducted by the British Beekeeping Association. “The BBKA says winter losses remain at an “unacceptably high levels and are still in excess of what might be considered normal losses of 5-10%”. It blames poor and variable weather, bee diseases and parasites such as the varroa mite and starvation.” (Benjamin, A. 2015). Poor weather and colder temperatures in winter months often cause a lack of food which slows down and weakens the hive honey production. Over the last 10 years there have also been increased cases of the Varroa mite, a mite which takes blood from both adult bees and developing broods and shortens the lifespan of the hive. However, effective treatment of the
mites is easy and straightforward to achieve, as long as beekeepers are vigilant with looking out for signs of the mite being present and administer treatment early. (BBC South Yorkshire. 2015). Another ongoing problem with setting up a new business is competition from other similar companies and their customers. The Sheffield Honey Company is a similar beekeeping and honey business located in Sheffield, also with beehives located in the Peak District. The company practices equally ethical methods of beekeeping in order to produce high quality honey, and effectively uses social media to keep in touch and regularly update their loyal and growing customer base.
own for selling their products, but has lots of small concessions throughout Yorkshire and some further afield in England. (The Sheffield Honey Company, 2017). For HNY. having a store to sell products will be an essential element of the business, as this plays a key role in tying the educational aspect to the business in an effective way. Concessions will eventually become a part of the business as it grows, but the HNY. store is important to have not just in the beginning, but as the business develops too. It is a place that aims to become synonymous with the brand, as well as being a centre for educating consumers about ethical beekeeping and the difference to be made to the welfare of our British honey bee.
However, the Sheffield Honey Company do not have a shop of their
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The Marketing Mix A. Product Initially there will be 5 different products on sale; 4 different honey flavours and beeswax bars. The honey will be sold in 8oz hexagonal glass jars, and the beeswax in 1oz bars.
The 4 flavours all have noticeably different tastes and textures to one another, and come from plants and foliage that are more readily in bloom at different times of the year.
the range of flavours and types of honey aims to increase, expanding into soft set honeys, honeycomb and perhaps food products with honey as the main ingredient.
Customers will be able to select any number of bars to buy and these will then be wrapped in tissue paper to protect them. This method of packaging for the bars is a cheaper alternative to paying for them to be wrapped individually before reaching the store.
This means that there will always be honey production at different times throughout the year, helping to reduce the risk of honey shortages during difficult seasons such as winter. for isn’t in stock.
Honey flavours will depend on different plants in bloom near the beehives, so this variation in honey flavours will come as the number of hives increases and spreads to different locations in the Peak District.
For example, heather blossoms more readily in winter, whereas apple blossom is more prominent in spring and summer.
Locations for new hives will be chosen based on nearby foliage. Possible flavours to consider adding would be Blackberry/bramble, Dandelion and Lavender, due to their prominence in the Peak District and synonymity with the English countryside. (PEAS Health. 2017).
4 different honey flavours: - Heather Honey - Clover Honey - Apple blossom - Mixed Honey
While this is a good method for ensuring a good honey yield all year round, it does mean that there may be issues with different flavour quantities during the different seasons, and this could cause customers to shop elsewhere if the flavour of honey they are looking for isn’t available. As the business develops and grows,
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B. People HNY.’s target consumer will be the considerate shopper; someone who pays attention to where their groceries come from and how they are sourced, as well as having the money to spend £6 on a jar of honey. Beekeepers, both commercial and hobbyists, my also be attracted to the brand. The educational element of the business aims to attract those who are eager to learn more about conservation of the honey bee (not just purchase the products). These people are more likely to spend £6 on a jar of honey if they appreciate where it has come from, even if they are not of middle class status.
Higher Professionals
As the HNY. shop will be located on Ecclesall Road in Sheffield, the immediate customer base will consist mainly of people living in the surrounding area. Ecclesall road is just outside the city centre and is a popular destination for restaurants, cafes and small businesses. The area itself has a high density of affluent, professional families who tend to pay close attention to where they shop for groceries, supporting the possibility of opening a small scale local honey shop. (Beacon Dodsworth. 2014).
Junior Professionals
The Beekeeper Initially there will be one Beekeeper (other than the director) who is hired to look after the hives and will work approximately 24 hours per week, on a wage of £10 per hour. This equates to £981.71 per month, as well as £21.71 that will be paid by the company as National Insurance. As the company expands and the number of colonies increases, the hourly contract of the beekeeper will increase to full time with a salary.
Manual Workers
The Shop Assistant There will also be one shop assistant, who’s hourly wage has been estimated at £7 per hour (approximately minimum wage for over 21 years of age). No national insurance payments are required to be made by the business.
Unemployed
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C. Positioning Working in the store will require at least an interest in beekeeping and eagerness to learn about the company and what HNY. aims to achieve.
High Cost
This will allow information to be passed on and for the store to develop its educational affiliation with the brand. Eventually more shop assistants will be needed, and more company profits will allow the hiring of staff with skills more specific and tailored to the brand. It is important for any company to have a set of core values and goals in order to successfully expand. In order to achieve this, HNY. has developed a purpose, vision and values that support the what the company aims to achieve.
Purpose: Conservation of the honey bee by practicing ethical beekeeping methods on a relatively small scale in order to provide a high quality product to the consumer, as well as educating customers about ethical beekeeping. Vision: Using education combined with a high quality product sourced from happy honey bees, to conserve and encourage the British bee population. Values: Education of as many consumers as possible, conservation of the British honey bee population and quality of products produced by well cared for bees.
Sheffield Honey Company
HNY.
Low Qualtiy
High quality
Supermarkets
Low Cost
D. Place HNY. will primarily have a store located on Ecclesall Road in Sheffield - a busy and thriving part of the city centre with an increasing number of small businesses.
to locating HNY. on Ecclesall road, including high commercial rent prices compared to other locations throughout Sheffield and a lack of on and off street parking along the road itself.
Locating HNY. here has many advantages, one being the number of small businesses that have already successfully been set up in the area, attracting shoppers from both the Ecclesall area and further afield who are likely to pay interest in a small scale and ethical beekeeping company.
There is also a large volume of students living nearby, who may be less inclined to pay interest and spend money on the product.
There is good access both by public transport, on foot and by driving. There is a wide range of commercial properties to let at any one time making it easier to select the right site to let, and most of these are the correct size for a small independent business.
However in the future, HNY. hopes to expand to include several concessions throughout Sheffield and perhaps even further afield throughout the UK. Concessions are a good way of measuring potential success in new locations, and taking steps towards opening another store in future.
There are however some disadvantages
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£6
£8
HNY.
The Sheffield Honey Company
E. Promotion Honey sales will be made in store to begin with, with a website used to showcase the story of HNY. alongside general information about the business and product information. Initially, products will only be able to be bought in store but prices and product details will all be available online. As the business expands both in terms of profit and resources an option to purchase products online will become integrated, adding a new dynamic to the sales side of the business as well as potentially attracting a new style of customer. When the HNY. store first opens, offering samples will be key in drawing in attention from consumers and allowing them to taste and experience the different types of honey on offer inside. This can be done throughout the city centre both prior to and and after opening, with the successful application of a City Centre Roaming Sampling
F. Price permit. (Sheffield City Council. 2017). This method of promotion can also be used in future at Concession stands and potential areas where a new store might be located. Social media, namely Facebook and Instagram, will play a large part in promotion and advertising especially before and shortly after the business has started. Social media is easily accessible and free to use, allowing businesses to advertise and communicate with consumers. Both a Facebook and Instagram account will be set up prior to the HNY. store opening, building up a following and gaining interest from the general public that will hopefully be reflected in the amount sold once the store is open.
“HNY. jars are lower in price and better value for money no matter what the flavour or type of honey, and the company can still make a steady profit.”
The Sheffield Honey Company is HNY.’s main competitor, offering 8ox jars of honey for £8-8.95 each, and 4oz jars for £3.50-4.50 each, depending on the type of honey. HNY. also sells beeswax and plans to expand this product range, adding something extra when compared to the Sheffield Honey Company. This makes HNY. a strong competitor as it is selling the same or similar products, produced using the same ethical beekeeping methods, but for a lower price. If HNY. were to sell these products at a price lower than £6 per jar, the company would not make a sizeable enough profit to allow for growth, and could incur losses in the first year. Honey will be need to be produced before the shop opens in order to allow time for a supply to build up and be jarred for selling. This supply will be used for sampling throughout Sheffield city centre prior
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HNY.
G. Packaging to opening. Price offers and discounts may be applied to products during different seasons depending on how abundant and popular they are, however because honey has no use by date there is no need to offer it at a lower price in order to sell before a certain date. An assessment of different flavours and their selling patterns will need to be made over the first year of trade, before deciding on any items to place on offer or at a discounted price.
The HNY. brand has a mature colour scheme and logo that is recognisable throughout the whole business. A simple brand design reflects the simplicity and organic nature of honey production, while a mature colour palette appeals to the target audience. Using an image of a honey bee gives a direct reference to the company purpose, vision and values, showing how the focus is on the honey bees themselves and not just what they produce.
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HNY. SWOT Analysis Strengths - The HNY. brand will educate consumers through in store advice, information and branding, helping it to stand out amongst other honey brands by giving more than just high quality honey products. - Compared with the main competitor (Sheffield Honey Co.), HNY. sells the honey for a lower price, as well as having a more diverse range of products in comparison. - The shop provides a central hub for consumers to visit and associate the brand with, giving the company a more established image despite being new to the market. - The strong ethical approach to the business supports the sustainable market and provides a good product for those who wish to buy well informed and considered products. - By starting off selling a smaller range of products in one store, this allows plenty of room and options for expansion, both in terms of business locations and products.
Opportunities
SW analys HN
- By starting with a small variety of products, HNY. has a lot of room for expansion within the product range. Possible product expansions include beeswax cosmetics (such as lip balm), beeswax polish, candles and pollen. - Collaborations with bigger brand names to produce product ranges could allow the brand to reach wider audiences and gain new custom. - HNY. already has a big educational aspect to the company, however this could develop to include educational events for schools and for adults wanting to learn more about beekeeping and how we can all do things to help the honey bee population. - All of these developments would contribute to the overall business development and can hopefully allow the business to expand and become a franchise with more stores located across the country.
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Weaknesses - Products are sold at higher prices than other brands and regular supermarket honey, and because of this there will always be consumers who will not buy HNY. - Beekeeping and honey production is an unpredictable industry, meaning that honey yield and profit will fluctuate. There are many uncontrollable factors that can influence honey production, such as weather. - The HNY. business start up costs are high (ÂŁ50,000), in order to obtain all the equipment and hives needed to start honey production on a large enough scale. - Different honey flavours are more or less prominent throughout the year, meaning that sales of different flavours and the quantities available will change so they may not always be able to meet customer demands on certain flavours, if these are out of season. This could result in a loss of custom.
WOT sis for NY.
Threats
- The Sheffield Honey Company is the main competitor for HNY. in Sheffield and although it may sell fewer products for a higher price, there is already a well established and dedicated customer base who may be hard to sway towards trying HNY. They may also be inclined to view HNY. as a new company who is trying to drive the Sheffield Honey Company out of business. - Mass market honey brands and supermarket options will always be popular to some consumers because of their low costs and convenience. - As previously mentioned, the unpredictability of the beekeeping industry will always threaten the success of the company, as their are such a wide range of factors that can affect honey and wax production. However, steps can and have been made to reduce these risks and ensure that there is a minimum impact on the company.
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The Sheffield Honey Company SWOT Analysis Strengths - The Sheffield Honey Company is currently the only honey business of its kind and scale in Sheffield, and so already occupies a majority of HNY.’s target audience. - The company has a strong brand identity and is well recognised on social media (Facebook). They post regular updates and have a strong relationship with followers. - Because the company does not have a shop, they have a long list of stockists spread over not just Sheffield but the entire country, reaching as far as London.
Opportunities
Th Sh ef Hon Com
- By developing a Sheffield Honey Company store or base, the company could provide people with a central hub for contact, product information and brand identity. - Expanding the flavours and product range available to include more than just honey could bring a larger turnover and wider audience. Beehives produce more than just honey and wax, and products including these core ingredients (such as cosmetics) are easy and low cost to manufacture. - General business expansion by gaining more beehives spread over a larger area could produce more honey and therefore more products and variety as mentioned above, and as the company is already well established and making a profit this should not be difficult to achieve.
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Weaknesses - Not having a shop is also a weakness for the Sheffield Honey Company, as this means there is no cohesive centre to the brand and means that direct contact with the company is limited to other means such as phone, email, or social media. - The Sheffield Honey Company website is visually poor and restricted in terms of what information is displayed and product information. There are no details on product purchase information such as pricing, and no background story on the brand. The entire website consists of just one page, which is quite confusing and can put people off due to lack of information.
he fi e l d ney mpany
Threats
- As a small honey company based in Sheffield, The Sheffield Honey Company faces many of the same threats as HNY. With beekeeping being such an unpredictable and ever changing industry, there are many factors that can affect the bees themselves and therefore honey and wax production. Factors such as weather variants can greatly increase or decrease production, as well as halting it altogether. - Supermarkets and companies offering mass produced, cheaper honey alternatives will always pose threat to smaller scale companies. There will always be a consumer audience who choose the cheapest option, and many people can be tough to win over into spending more on something, even if it is of better quality and more ethically sound.
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05. Operational Plans Production and Location
Legality
HNY. will have beehives located throughout various locations in the Peak District which will be used for harvesting the honey and wax. Honey filled frames are removed from the hives and replaced with empty ones, then transported back to the honey store to be processed.
Because HNY. will be using a website where consumers can contact the company via personal email address (and can potentially shop online in future), the Data Protection Act of 1998 will need to be adhered to. This regulates the holding, using and disclosing of anyones personal information that has been given to the business (Gov UK. 2017).
The HNY. store is where all processing happens in back of house, and the honey frames are placed in a honey extruder. After this the honey is poured into 8oz jars which have been washed before hand, and are then labelled after being filled. The jars are now ready to sell. Beeswax bars will be produced in a similar method, where the wax is extracted from the frames and filtered before being melted and the remaining clean wax is poured into moulds. After setting, the bars are removed from the moulds and ready to sell.
Public Liability Insurance is insurance that a business can take out for protection in the event that a member of the pubic is injured or their property is damaged as a result of the business. (Pratt, K. 2016). This has been estimated for HNY. at a cost of £50 per year, as the only aspects of the company that come into direct contact with members of the public will be when consumers visit the HNY. store, and when honey is being transported in a van from beehives to the shop.
Personnel
“The average UK annual public liability insurance premium costs £761. However, most small businesses and sole traders will pay much less than that and it can be as little as £40 a year.” (Bodenham, D. 2017).
Aside from the business owner the company will employ 2 personnel; a beekeeper and a shop assistant: The beekeeper will be contracted to work part time 24 hours per week with a wage of £10 per hour. The roles involved in being the beekeeper are tending to and collecting honey from the bees, as well as transporting it to the HNY. store for extraction. Prior experience, training and extensive knowledge will be required in order to handle the bees safely and look after them effectively. The beekeeper will be someone who has an understanding and appreciation for the business purpose, vision and values, and who puts the welfare of the honey bees first. Without this dedication, there runs a risk of undermining the ethics of the company.
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Suppliers
The shop assistant will also be contracted to work part time for 15 hours per week, with an hourly wage of ÂŁ7. The roles involved in being a shop assistant in the HNY. store involve interacting with consumers and being able to educate and advise about what the company does, different ethical beekeeping methods, and how customers can and do make a difference to the welfare of the honey bee.
Suppliers have been used for the following production materials: - Beehives - Hive tools - 8oz glass jars - Cardboard boxes (for transporting honey frames) - Jar labels - Paper bags - Tissue paper (for wrapping beeswax bars) The suppliers fo these items have been detailed in the HNY. Technical Pack.
The store assistant will be someone who has a passion for ethical beekeeping, as well as an eagerness to pass on information to others.
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Management and Organisation
The Director
The Beekeeper
The Shop Assistant
The director of HNY. will be responsible for developing and guiding the business through its growth, primarily focusing on building an effective website and social media platform in year 1.
The beekeeper will work part time alongside the director to manage the honey bee colonies in the first year, before becoming full time in year 2 in order to look after the growing number of colonies.
The shop assistant will also work part time in the first year and will be responsible for building face to face relations with customers, as well have building up an extensive knowledge about HNY.’s products, what the company does and how they are helping the British bee population. They will also inform consumers about how they can and do make a difference with HNY.
The director will also be qualified to work with the honeybees, sharing responsibilities with the beekeeper and ensuring an in depth understanding and appreciation for every aspect of the business. As the company expands, these responsibilities will broaden and the focus will become more on maintaining customer relationships and ensuring successful business development.
The beekeepers primary responsibilities will include safe handling of the bees and honey, and transportation of honey from the hives to the HNY. store. They will need to be adequately trained and qualified to do this. In year 3, another beekeeper will join the company to help with the growing numbers of colonies and their honey yield, as well as allowing the director more time to focus on other aspects of the business such as expansion, product development and educating consumers.
As the company expands and develops, another shop assistant(s) will be employed to work in the HNY. store and concession stands that my be used throughout Sheffield.
HNY. will cap the number of honey producing hives at 250 by the end of year 3. This allows for one full time beekeeper and the director to still effectively manage the hives, as well as still keeping the business at a manageable yet profitable size. Any hives that naturally split after this cap can be sold, although splitting will no longer be encouraged on a regular basis. The hive number can be increased at any time, however this will depend on consumer demand.
All employees will share the same responsibilities and will focus primarily on educating the consumers and building customer relations in store.
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Start Up Expenses
Financial Plan
The total start up expenses for HNY. have been calculated as month one’s total expenditure in the companies’ financial forecast, at a total of £44,804.53. This includes the cost of all equipment and bees.
The loan of £50,000 will be mostly used to invest in equipment, beehives and bee colonies before the business begins operation. This will take 10 years to be fully paid back to the bank, at a cost of £580.54 per month..
In order to offset this expenditure, a business loan of £50,000 will be taken out an repayments will start in month 7, when the business has made sufficient income to afford this..
Once up and running, the vast majority of income will be spent on rent and utilities, as well as the beekeepers’ wages.
As of the 2nd year of trade, HNY. will have to pay VAT back on all profits made, with a total amount of £29,090 at the end of the year. Profits will increase steadily year on year, until year 4 when the number of beehives will be capped at 250 for a couple of years. This is to ensure that the colonies stay managable whilst still producing large quantities of honey, and any extra colonies that develop
will be sold. This means that profits will stay at approximately £113,500 for years 4 and 5. As the product range expands after year 5 income and expenditure will both increase, although overall this will lead to greater profits in the long term.
Closing Balance
300K
200K
Net Profit
100K
Year 1
Year 2
Year 3
Year 4
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Bibliogrpahy (BBC South Yorkshire. 2010) BBC NEWS. 2017. BBC - The honeybee and the varroa mite. [ONLINE] Available at: http://news.bbc.co.uk/ local/sheffield/hi/people_a nd_places/ newsid8_ 886000/8886387.stm. Accessed: 27 March 2017. (Beacon Dodsworth. 2014)
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Available at: https://www.theguardian. com/environment/2015/jun/25/morethan-14-of-englands-honeybe ecolonies-died-over-winter. Accessed: 27 March 2017
(deZylva, P. N/A) Ethical Consumer. Your consumer guide to honey. Helping the honey bee. Page 3. Accessed: 27 March 2017
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