Coffee Shop Business Plan

Topics: Venture capital, Bond, Private equity Pages: 5 (1706 words) Published: April 15, 2011
Integrative Case, HannaH page 1

Integrative Case, HannaH

By; Kimberly King-Mahaffey

Professor Toiya Evans

Finance 100

May 30, 2010

Integrative Case, HannaH page 2

Hannah Eisenstat had a business plan to own and operate a small business to sell coffee to patrons. The business started out with one owner Hannah being sole proprietorship venture. The business started out a bit weak while Hannah found once it was up and operating that the coffee did not produce the flavor she had anticipated and envisioned. A regular customer made an offer to become an investor offering an idea that would eliminate the small business into a larger company that would offer a better quality of coffee, but by doing this the owner would have to agree to add a larger machine and enhance the business by roasting their very own coffee beans. This eventually caused the operation to prosper so while growing the company HannaH actually employed more people and had larger sells of coffee going out. This investor would be an Angel Investor which is a type of Investor that lends money to help start or even expand in the growth of a business. This type of investor can help with expansion of businesses and deciding on some of how the business will operate. (, 2010) Natasha was this investor and she would lend Hannah a sum of $75,000 and in return received 40% share in the business. The investor helped in the new ideas that would be put into place in the business such as operations and the expansion of it. While the two having an impact on the operation and seeing that sells would meet expectations, while at the same time the vision they both have for future development, the business started doing extremely well

Integrative Case, HannaH page 3
So expansion became quickly as with in the next two years they both decided it was time again to expand out to five more stores to cover a larger territory. In doing this it would require them to go with bank financing this way they could leave the equity in the business for collateral on a bank loan. The type of loan they choose was a term loan which has stipulations to be paid back with in a five year term. Sense the business had shown such a quick response in growth this type of loan would be possible and the business shows the revenue needed for future sells that makes it a strong investment for both the bank and the company. Therefore as the business sells sore so does the shares in the business. Having the back bone of the business at a stable and strong point put the owner in a position to attain $100,000 for each store to start up operations. Furthermore by opening five new stores it opened 30 new jobs positions for people in the area. The two owners have done the internal audit of the business and while still making future plans decided to go even further in the venture of the business, by doing this the two did reevaluate their initial business plan and go further, realizing the popularity of the roasted bean they produced. This popular bean brought in 80% of the revenue while the beverage itself only 20%. A buyer of a local market showed high interest in the product and approached the two owners and wanted to carry this in the supermarket chain. HannaH at the capacity limit of what could be produced would cause Hannah and Natasha to rethink the business once again, and decided to reevaluate the roasting of beans and go with a farmer in Costa Rica while at the same time being able to

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monitor the quality a bit closer and provide a larger quantity of beans for the supermarket chain which would require a huge increase in the production of the beans. The need to expand would cost more money so by once again reevaluating the business plan and moving on from providing a beverage into just selling coffee beans wholesale would now be the focus, in doing this the owners decided to invest into a larger facility that offers...
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